Uber Board and CEO Sued Over Sexual Assault Safety Failures

Detroit’s Police and Fire Retirement System has filed a lawsuit in California federal court against Uber’s board and CEO Dara Khosrowshahi. The shareholder complaint alleges the company ignored sexual assault risks and cut compliance corners to prioritize growth and maintain its independent contractor business model.

Why is Uber being sued by its own shareholders?

The lawsuit, filed by the minority investor Detroit’s Police and Fire Retirement System, claims Uber’s leadership failed to address thousands of sexual assault claims involving passengers and drivers. The complaint alleges that the company “knowingly cut compliance corners in the name of growing the company.”

The filing specifically targets CEO Dara Khosrowshahi and members of the board of directors. It claims Khosrowshahi, who took over from Travis Kalanick in 2017, implemented only “cosmetic changes” to workplace culture and compliance practices.

According to the complaint, Uber’s culture prioritized cost-cutting, which led the company to skimp on compliance or attempt to “tamp down on complaints.”

Did You Know? Around 2017, Uber studied the addition of in-car cameras and found the plan feasible and cost-effective, yet the company declined to implement the technology.

How did Uber’s business model impact safety decisions?

The lawsuit alleges Uber rejected or delayed safety initiatives to protect its gig-work model. Specifically, the complaint points to in-car cameras, more rigorous background checks, and programs to match women riders with women drivers.

Uber faces lawsuit over sexual assault complaints

The complaint states Uber declined the cameras because doing so would mean “exercising greater control over drivers’ activities.” This control could have weakened Uber’s legal argument that drivers are independent contractors rather than employees who receive benefits like healthcare.

An Uber spokesperson disputed these claims, stating the lawsuit is based on “misleading, false narratives from other meritless lawsuits.” The company maintains that safety incidents are “exceptionally rare” and that it works constantly to improve trip safety.

Expert Insight: Samantha Carter notes that this case highlights the fundamental tension between the gig-economy’s reliance on independent contractors and the corporate liability that arises when safety oversight is minimized to maintain that specific employment classification.

What are the potential consequences for Uber?

The plaintiffs argue that the board’s alleged “unlawful conduct” has left the company vulnerable. The complaint notes that Uber faces “hundreds of millions of dollars at stake” and significant liability in defending ongoing suits.

Beyond financial losses, the lawsuit claims Uber’s reputation has been “irredeemably damaged” by media coverage of the misconduct. The company may face continued regulatory scrutiny and high litigation costs if the court finds the board provided inadequate oversight.

Frequently Asked Questions

Who filed the shareholder lawsuit against Uber?
The lawsuit was filed by Detroit’s Police and Fire Retirement System, a minority investor in the company.

What specific safety measures did Uber allegedly reject?
The complaint alleges Uber rejected or delayed the use of in-car cameras, more rigorous background checks, and programs to match women riders with women drivers.

How has Uber responded to the allegations?
An Uber spokesperson stated the lawsuit ignores important facts and relies on “misleading, false narratives” from “meritless lawsuits.”

How should companies balance the flexibility of the gig economy with passenger safety requirements?