Shortly after a group of Uber shareholders asked Benchmark to relinquish its spot on Uber’s board of directors, Sherpa Capital’s Shervin Pishevar is petitioning Benchmark via Change.org to remove itself from Uber’s board. The petition also asks Benchmark to sell at least 75 percent of its stock so that the firm no longer has rights to appoint members to Uber’s board of directors.
“We have investors ready to acquire these shares as soon as we receive communication from Benchmark that they are willing to withdraw their lawsuit and sell a minimum of 75% of their holdings,” the petition states.
Benchmark is suing former Uber CEO Travis Kalanick, alleging violation of fiduciary duty and fraud by seeking to “increase his power over Uber for his own selfish ends.” Benchmark’s lawsuit ultimately seeks to remove Kalanick from the board. Since filing the lawsuit, the tables have turned, and a group of shareholders is now asking Benchmark to remove itself from the board.
Uber’s board of directors has also spoken out against the lawsuit, saying it’s “disappointed that a disagreement between shareholders has resulted in litigation.”
Now back to the petition. At the time of publication, Pishevar’s petition had just 41 supporters. Change.org will deliver the petition to Benchmark once it hits 100 supporters. A source says Pishevar has sent the petition to some fellow Uber investors, asking them to get on board.
Why Pishevar thinks Change.org will be more effective, I’m not sure. I’ve reached out to him and will update this story if I hear back.
Here’s the full petition:
As a group of shareholders of Uber Technologies, Inc. (the “Company”) we were surprised and distressed to learn through the media of the lawsuit brought by your firm against the Company, and its founder and former Chief Executive Officer Travis Kalanick.
Naturally, we share your concerns about the problems that the Company has confronted in recent months, but we are greatly concerned about the tactics employed by Benchmark to address them, which strike us as ethically dubious and, critically, value-destructive rather than value enhancing.
Specifically, we do not feel it was either prudent or necessary from the standpoint of shareholder value, to hold the company hostage to a public relations disaster by demanding 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.
Accordingly, we would request that Benchmark help the Company realize its full potential by allowing the necessary work to be done in the Board Room rather than the Courtroom. To this end, at this point, in light of your suit against the Company, we believe it would be best, and hereby request, that Benchmark remove its representative from the Company’s Board and move promptly to divest itself of enough shares in the Company so as to cease to have Board appointment rights. We have investors ready to acquire these shares as soon as we receive communication from Benchmark that they are willing to withdraw their lawsuit and sell a minimum of 75% of their holdings.
We are also asking for a symbolic Board of Directors vote on this matter at today’s Board meeting to show how the Board of Directors stands on this lawsuit brought against the company, its founder and the 15,000 employees of Uber who have all worked so hard in concert to create the fastest growing company in history.
Many other shareholders share our views and will be adding their names in the days ahead.
Personal Investor, Advisor and Former Uber Board Observer (2011-2015) Coordinator, Uber Shareholder Alliance