Shareholders sue Uber for hiding the illegality of their company
Those who bought shares in Uber Technologies Inc.’s IPO have sued the company for allegedly withholding information about the legality of its business model, its passenger safety record and other issues. The lawsuit represents several investors who bought stock when the company went public, a California federal court has ruled.
Common issues outweigh individual issues, including “bits of information” people associated with an institutional investor may have had, Judge Richard Seeborg of the U.S. District Court for the Northern District of California said on Tuesday.
Seeborg has approved a class definition that includes everyone who acquired the trucking company’s common stock pursuant to filings with the Securities and Exchange Commission prior to the initial public offering, with some exceptions for those who have other close ties with Uber.
The Boston Retirement System and other investors alleged that Uber “based its growth on an undisclosed and unsustainable ‘growth at all costs’ business model, placing growth above profits, the law and even passenger safety,” the investors said.
The offering documents misleadingly claimed that the company had reformed and changed its internal cultural norms, despite continuing legal, security and growth issues, according to the collective certification petition.
Uber issued and sold more than 180 million common shares during its IPO, according to the plaintiffs.
Uber shares went from $45 in the May 2019 initial public offering (IPO) to around $26 in November 2019.
Uber is doomed, as are the cities that supported it
Seeborg dismissed Uber’s argument that the issues in the case weren’t common enough for a class certification because BRS’ investment manager had employees who knew about the issues that Uber allegedly failed to address. its IPO filings.
“In a securities class action lawsuit against fellow ride-hailing operator Lyft, another court in that district rejected the claim that certain knowledge about the issues Lyft was facing regarding sexual assault overcame preemption” , Seeborg said.
In this case, as here, the plaintiffs’ knowledge goes “to awareness of a general problem, not to the magnitude of the alleged problems,” he said. BRS and four individual investors will serve as class representatives.
Seeborg appointed Labaton Sucharow LLP as class counsel. Shearman & Sterling LLP and Willkie Farr & Gallagher LLP represent Uber.
#Shareholders #sue #Uber #hiding #illegality #company #Todo #Taxi