Uber Investors Fighting Benchmark Lawsuit Against Former CEO

Uber investors are trying to fight a lawsuit by shareholder Benchmark Capital against former CEO Travis Kalanick.

Reuters reported Shervin Pishevar, a venture capitalist with Sherpa Capital who is an Uber investor, sent a letter to the company’s board of directors to inform them he was seeking to intervene in the lawsuit filed on August 10. He said Benchmark’s effort to remove Kalanick from Uber’s board was aimed at gaining control of the company.

“If Benchmark insists on trying to use the courts to try to take over this company, we are committed to doing everything we can to try to stop this abuse,” Pishevar wrote in the letter sent Thursday.

At issue is a change to the board structure last year that expanded the number of voting directors by three, with Kalanick having the sole right to fill those seats. Benchmark accused Kalanick of hiding a number of misdeeds when he asked Uber’s board to give him those extra seats. Kalanick was forced to resign his position as CEO in June, but he remains on the board and is involved in the company’s search for a new CEO.

Kalanick has called the Benchmark lawsuit a “public and personal attack” without merit.

Benchmark owns 13 percent of Uber and controls 20 percent of the voting power, while Kalanick holds approximately 10 percent of Uber stock and about 16 percent of its voting power. The lawsuit could determine who is in power at Uber as the company tries to hire a new CEO, recover from a series of scandals and turn into a profitable business.

Pishevar and fellow Uber investor Stephen Russell have come to Kalanick’s defense. In their motion to intervene in the lawsuit, Pishevar and Russell blasted Benchmark’s “dirty tactics” and “public smear campaign” against Kalanick. In the document, they called Benchmark’s lawsuit a “transparent” effort “to unscrupulously gain control of Uber’s board of directors.”

Pishevar had already called on Benchmark Capital to step down from the board and sell the majority of its Uber stake. Benchmark, an early Uber investor, has a seat on the company’s board, while Pishevar’s firm does not.