Benchmark Capital sues Uber ex-CEO Travis Kalanick for alleged fraud

Last Updated Aug 10, 2017 5:35 PM EDT

Benchmark Capital, one of Uber's biggest investors, is suing former CEO Travis Kalanick for alleged fraud. 

The venture capital firm was one of the first investors in the ride-hailing service and was key in removing Kalanick from his post as CEO earlier this year. 

The complaint, filed Thursday in Delaware Chancery Court, accuses Kalanick of fraud, breach of contract and breach of fiduciary duty. Benchmark's lawsuit alleges the entrepreneur "intentionally concealed and failed to disclose his gross mismanagement" of the company while trying to pack the company's board with his allies.

That purported mismanagement includes the alleged theft of a rape victim's medical records; Uber's acquisition of the startup Ottomotto, which allegedly included "stolen trade secrets"; and the company's "pervasive culture of gender discrimination and sexual harassment." 

According to the suit, Kalanick, knowing that his behavior would eventually get him fired as CEO, moved to expand the board and gain control of it as a way to "entrench himself on Uber's Board of Directors and increase his power over Uber for his own selfish ends." His ultimate objective, the VC firm alleges, is to reinstate himself at the head of the firm.

A spokesman for Kalanick called the lawsuit "completely without merit and riddled with lies and false allegations," according to media reports. He said Benchmark was making a "transparent attempt to deprive Travis Kalanick of his rights as a founder and shareholder."

Benchmark is seeking to cut the board by three seats, which would remove Kalanick from the board of directors and effectively cut him off from the search for a new CEO.

Uber has been without a chief executive after Kalanick stepped down in June under pressure from the board. The departure took place after investigations by outside law firms uncovered widespread sexual harassment at the company.  

Axios first reported the lawsuit.

Earlier on Thursday, Ryan Graves, Uber's first employee, said he was leaving his role as head of global operations.