Uber Technologies is facing a lawsuit from shareholders for allegedly allowing the company to cut corners on compliance, resulting in a surge of sexual assault and harassment lawsuits. The lawsuit, filed in San Francisco federal court by shareholders led by a Detroit pension fund, claims that Uber’s board turned a blind eye to warnings about the company’s failure to address sexual abuse by drivers.
The shareholders also pointed out that Uber’s oversight failures played a role in two federal lawsuits from last year. One lawsuit accused Uber of discriminating against disabled passengers by refusing to serve them, while the other alleged deceptive billing practices in the Uber One subscription service.
According to the complaint, Uber has gained a reputation as a “serial compliance offender” and has suffered irreparable damage due to negative media coverage. In response, a spokesperson for Uber dismissed the lawsuit as misleading and based on false narratives from previous lawsuits that have already been addressed.
The lawsuit, known as a derivative lawsuit, seeks to hold directors accountable for breaching fiduciary duties and violating securities laws, with any financial recoveries benefiting shareholders. CEO Dara Khosrowshahi is named as one of the defendants, with shareholders criticizing his approach to regulatory compliance.
Uber is currently facing 3,571 lawsuits related to drivers’ alleged sexual misconduct in San Francisco court. Shareholders highlighted that less than 40 percent of users believe the company takes safety seriously. Additionally, Uber and Lyft recently filed a lawsuit against New York City to challenge a new law aimed at preventing them from removing drivers who jeopardize passenger safety.
Since reaching its peak on September 22, Uber’s stock price has dropped by over 25 percent.
