Uber Shareholder Group Wants Benchmark Off Board (axios.com)

Dan Primack, reporting for Axios: A group of Uber investors has asked that venture capital firm Benchmark step down from the company's board of directors, Axios has learned. It also wants Benchmark to divest enough shares so as to no longer have board appointment rights. The move comes one day after Benchmark sued former Uber CEO Travis Kalanick for fraud, in an attempt to have him removed from the board. From the letter: Mr. Kalanick's resignation, along with other concessions, on a few hours' notice and within weeks of a personal tragedy, under threat of public scandal. Even less so your escalation of this fratricidal course -- notwithstanding Mr. Kalanick's resignation -- through your recent lawsuit, which we fear will cost the company public goodwill, interfere with fundraising and impede the critical search for a new, world-class Chief Executive Officer. Benchmark has used false allegations from lawsuits like Waymo as a matter of fact and this and many actions has crossed the fiduciary line. Benchmark's investment of $27M is worth $8.4 billion today and you are suing the founder, the company and the employees who worked so hard to create such unprecedented value. We ask you to please consider the lives of these employees and allow them to continue to grow this company in peace and make it thrive. These actions do the opposite.

Comments

It's about control of the Board of Directors

[Fencepost]

"The suit revolves around the June 2016 decision to expand the size of Uber's board of voting directors from eight to 11, with Kalanick having the sole right to designate those seats. Kalanick would later name himself to one of those seats following his resignation, since his prior board seat was reserved for the company's CEO. The other two seats remain unfilled." and "Benchmark alleges that Kalanick pledged in writing -- as part of his resignation agreement -- that the two empty board seats would be independent and subject to approval by the entire board (something Benchmark says was the reason it didn't sue for fraud at the time). But, according to the complaint, Kalanick has not been willing to codify those changes via an amended voting agreement."

Basically Kalanick PERSONALLY (not as Chairman, CEO or anything else) has the potential to control 3/11ths of the board, and if he can convince 3 more board members to go along then he can control the board even if the remaining 5 original board seats disagree. Benchmark regards this as way too risky considering all the other crap he's pulled in the past.