A Detroit pension fund has filed a lawsuit against Uber's board of directors, accusing them of prioritizing profits over regulatory compliance and passenger safety. The legal action, filed on Monday in the U.S. District Court for the Northern District of California, alleges that Uber is a serial compliance offender that knowingly cut corners, exposing the company and shareholders to thousands of lawsuits from victims of sexual assault and harassment by drivers.
Pension fund leads derivative suit over board negligence
According to the complaint, the Detroit pension fund is acting on behalf of Uber, seeking that board members and CEO Dara Khosrowshahi personally compensate the company for damages. The plaintiffs claim that management ignored repeated warnings about deficiencies in compliance and safety systems, leading to thousands of legal proceedings for sexual assault and harassment, as well as discrimination against customers with disabilities and issues with the Uber One subscription service. The lawsuit argues that the lack of a compliance culture exposed the company to enormous risks, with legal and reputational costs borne by shareholders.
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Uber labeled a serial compliance offender by plaintiffs
The complaint describes Uber as a company lacking a true compliance culture, calling it a serial compliance offender. This lack has allegedly resulted in thousands of lawsuits, including those filed by victims of sexual violence. The plaintiffs assert that the board and executives deliberately ignored red flags, continuing to prioritize growth and profits. The victims of this lack of compliance culture include sexual assault and harassment victims, customers with disabilities, and unwary consumers looking to subscribe to Uber One, the document states. The lawsuit highlights how Uber has accumulated an staggering number of legal cases, with costs reaching billions of dollars, and that the board should have intervened much earlier.
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Plaintiffs demands and Uber's response
The plaintiffs are asking that Uber leaders personally compensate the company for damages, return part of their compensation, and implement stricter oversight and compliance measures. Specifically, they want the board to adopt more stringent compliance policies and create independent oversight structures. Uber has pushed back, calling the lawsuit based on misleading, false narratives from other meritless lawsuits that we have already addressed publicly and in the courtroom. A spokesperson stated that the lawsuit ignores important facts and that Uber has already implemented significant improvements in passenger safety. However, plaintiffs argue these improvements are insufficient and overdue.
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Implications for corporate governance and the tech sector
Derivative lawsuits, where a shareholder sues directors on behalf of the corporation, are not uncommon for companies like Uber. This year, shareholders have filed similar lawsuits against Adobe, Apple, and Intel. The Uber case could have significant implications for corporate governance, pushing other companies to strengthen their compliance systems. For further details on the legal dynamics, see our previous article on Uber sued by shareholders. Additionally, a broader analysis of board responsibilities can be found on Wikipedia. The case is set to become a benchmark for board accountability in technology companies.
Source: https://techcrunch.com/2026/06/22/shareholders-sue-ubers-board-over-sexual-assaults-other-incidents
