Detroit pension fund sues Uber board over compliance failures and safety breaches

A Detroit-based pension fund has initiated a shareholder derivative lawsuit against Uber, alleging that the company’s board and executive management placed financial returns above regulatory compliance and passenger safety. The complaint, filed on Monday in the U.S. District Court for the Northern District of California, characterises Uber as a “serial compliance offender” that has knowingly cut corners, resulting in significant legal exposure for the corporation.

The filing accuses the board of breaching their fiduciary duties by ignoring repeated warnings regarding safety failures. It names Chief Executive Officer Dara Khosrowshari and claims that leadership’s decisions have exposed both the company and its shareholders to substantial risk. The plaintiffs argue that this systemic lack of compliance culture has directly harmed victims of sexual assault and harassment by drivers, customers with disabilities, and consumers subscribing to the Uber One service.

According to the complaint, the company’s operational practices have led to thousands of lawsuits from victims alleging sexual assault and harassment by drivers. The plaintiffs are seeking specific remedies, including personal compensation from leaders for alleged harm, the clawback of certain executive remuneration, and the implementation of stronger oversight and compliance measures. The suit represents a legal mechanism where shareholders sue directors on behalf of the corporation to address alleged governance failures.

Uber has firmly rejected the accusations. In an emailed statement, a spokesperson dismissed the claims as ignoring important facts and relying on misleading narratives from other meritless lawsuits that the company has already addressed in court. The technology firm maintains that the allegations do not reflect the reality of its compliance efforts or safety protocols.

This legal action follows a broader trend of similar derivative lawsuits filed against major technology companies this year, including Adobe, Apple, and Intel. These cases highlight increasing shareholder scrutiny of corporate governance and compliance cultures within the sector. The outcome of the newly filed action remains unknown as the legal process begins.