A Delaware judge ruled Wednesday that an investor lawsuit[1] targeting Uber Technologies' former CEO must be moved to private arbitration.
The judge granted former CEO Travis Kalanick's[2] request to put the lawsuit on hold while an arbitrator considers claims raised by venture capital firm Benchmark Capital Partners.
The ruling came one day after Uber[3] confirmed in a note to employees of the San Francisco-based ride-hailing company that former Expedia CEO Dara Khosrowshahi had agreed to become Uber's new chief executive[4]. Uber's board voted unanimously to offer him the job on Sunday.
Benchmark, which holds more than a third of Uber's preferred stock voting power, claims Kalanick concealed material information regarding internal problems and external litigation threats facing the company last year when investors granted him authority to fill three new board seats.
Kalanick has said the lawsuit is a baseless attempt[5] to slander him with false allegations, and that Benchmark's claims are subject to mandatory arbitration.
Kalanick resigned under pressure in June[6] but quickly appointed himself to one of the three board seats. Benchmark, which says Kalanick is attempting to entrench himself on Uber's board and increase his power over the company "for his own selfish ends," is trying to prevent him from filling the two other seats.
"I think what we have here is a political battle that belongs in the boardroom, not the courtroom," Donald Wolfe Jr., an attorney representing Kalanick, told Vice Chancellor Sam Glasscock III at Wednesday's hearing.
The dispute involves Kalanick's successful effort last year to expand Uber's board from eight members to 11 members, with authority given to him to designate the individuals who would fill the three...