It is hard to believe but even more scandals and reports of shady, unethical; and quite probably illegal, business practices at Uber Technologies Inc. keep cropping up.
The latest crop of Uber Scandals includes:
- Uber’s president of business for Asia Eric Alexander was fired after allegations that he had obtained the medical records of an Indian woman who accused an Uber driver of rape. Alexander allegedly shared the records with Uber CEO Travis Kalanick; and Senior Vice President of Business Emil Michael, The New York Times reported. Alexander was seeking evidence that the rape allegations were part of a conspiracy to drive Uber out of India hatched by a competitor called Ola. This allegation might get Uber into hot water in the United States, because Alexander’s might violate a federal law called the Foreign Corrupt Practices Act.
- Uber fired 20 employees because of allegations about harassment, inappropriate behavior and discrimination, The New York Times reported. The firings came as a result of sexual harassment complaints by former Uber engineer Susan Fowler and allegations of a “toxic culture” at the company.
- Uber has retained former United States Attorney General Eric H. Holder Jr. and his law firm Covington & Burling, The New York Times The cover story is that Holder is conducting an “investigation into Uber’s corrupt culture.” The real reason Kalanick has hired Holder is to defend against a criminal prosecution by the United States Justice Department and an FBI investigation of Uber.
- U.S. District Judge William Alsup was so disgusted by descriptions of Uber’s conduct made by Alphabet’s (NASDAQ: GOOG) attorneys that he asked the Justice Department to investigate the company. Alphabet (NASDAQ: GOOGL) is alleging that Otto founder Anthony Levandowski stole thousands of files about self-driving car technology from its subsidiary Waymo. Uber later paid Anthony Levandowski $680 million for Otto. Levandowski has been fired by Uber; but there’s a strong possibility he might testify against Kalanick, in exchange for a reduced sentence. The Levandowski Affair is the real reason Kalanick and company need a top notch criminal defense attorney like Holder.
- Uber has been fined $98,000 for illegal lobbying practices by New York State’s Joint Commission on Public Ethics, The Journal News reported. Uber was fined for not reporting more than $6 million in lobbying expenses in the Empire State in 2015 and 2016. Uber told the Commission it spent $3.1 million on lobbying when it actually spent $9.4 million. That’s a pretty poor business model and a major waste of money.
- Dozens of Uber drivers have been terminated by the company for questionable reasons, National Public Radio (NPR) reported. Most of them received the news of termination when they were unable open the app to go to work. That sounds like a class action lawsuit waiting to happen.
- Uber is trying to fix its image by hiring larger than life Apple Music Marketing executive Bozoma Saint John as its first chief brand officer, CNET reported. Saint John will have the thankless; and possibly impossible, job of making Uber more like Airbnb which brings people together for a human transaction rather than using them. Airbnb hosts love that platform while Uber drivers hate the ride-sharing app and despise Kalanick. That sounds as if Kalanick is trying to repackage the Uber brand in order to make it easier to sell. He might soon need the money to pay his legal bills.
My take is that Uber is about to lose most of its value and possibly collapse. All it will take is a few seconds of TV news footage of FBI agents taking Kalanick away in handcuffs to destroy Uber.
When that happens; it will quickly get bought up by a private equity firm or a tech or auto industry giant. Possible buyers for Uber include; Ford (NYSE: F), General Motors (NYSE: GM), China’s Didi, Renault-Nissan, Toyota Motors (NYSE: GM), BMW, Tata Motors (NYSE: TTM), Alphabet, Volkswagen, Honda Motors (NYSE: HMC), Japan’s SoftBank Group, and China’s Tencent Holdings.