- Benchmark officially dropped its lawsuit against Travis Kalanick on Thursday.
- Dropping this suit was part of the deal that sold 15% of Uber to SoftBank.
- The suit was dropped “with prejudice” meaning that Benchmark can never decide to sue Kalanick over this issue again.
- It’s a relatively happy ending between the two estranged Uber board members.
As promised and expected, Uber investor Benchmark has officially dropped its lawsuit against Uber board member and former CEO Travis Kalanick.
The suit, filed in August, accused Kalanick of fraud and attempted to wrestle away two board seats from Kalanick’s control as well as get Kalanick removed from the board, himself.
The suit was dropped on Thursday “with prejudice” meaning that a plaintiff – in this case Benchmark – cannot refile the suit at a later date and can never sue again over the same issue.
The lawsuit was dropped in conjunction with a massive financing deal Uber recently closed with Softbank. Softbank bought about 15% of the company, mostly from existing shareholders including Kalanick and Benchmark. The stipulations of that deal included a number of changes to how Uber’s board operates. These changes included eliminating shares with extra voting rights, vastly increasing the size of the board, and subjecting the two board seats controlled by Kalanick to approval by the entire board of directors.
By dropping the lawsuit, Benchmark has also dropped its formal attempt to get Kalanick kicked off the board.
But Benchmark achieved it’s goal of limiting Kalanick’s power with the Softbank deal.
Meanwhile, Kalanick is taking a victory lap, too. The lawsuit against him is over. And he’s achieved his goal of bringing Softbank in as a major investor, preventing a potential alliance between Softbank and Lyft, Uber’s main competitor in the US.
And for the first time, Kalanick sold off small chunk of his Uber shares. He retains about a 7% stake and pocketed $US1.4 billion cash from the shares he sold in the Softbank deal.