A handful of Uber shareholders filed a lawsuit against the company and its former chief executive for what they claim is the covering up of illegal business tactics.
According to a news report in The Wall Street Journal, the lawsuit, which was filed by the Irving Firemen’s Relief & Retirement Fund, contends that Uber’s ex-CEO, Travis Kalanick, knew he was misleading investors during capital-raising efforts by not informing them that Uber may have broken laws. The lack of a disclosure, contends the Uber lawsuit, resulted in billions of dollars in losses for investors.
The fraud allegations lawsuit was filed in the U.S. District Court for the Northern District of California and seeks class-action status. The Uber investors are asking for damages that were not laid out in the suit. The fund had invested roughly $2 million in Uber in February via a Morgan Stanley fund.
“The company’s vaunted corporate culture was revealed in truth to consist of a toxic hotbed of misogyny, sexual discrimination and disregard for the law that threatened the company’s reputation, business and prospects,” the complaint read, according to The Wall Street Journal.
The fund claims Uber lost more than $18 billion in its market capitalization due to the wrongdoings. The lawsuit pointed to news reports that Uber, a private company, used software to get around regulators.
This is just the latest in a string of legal problems for the ridesharing company. Uber already faces the potential for three federal inquiries, including an initial inquiry by the Justice Department over allegations it violated the Foreign Corrupt Practices Act, according to The Wall Street Journal, who also noted that the company is cooperating with investigators. The lawsuit pointed to news reports that Uber used software to get around regulators.