Uber (UBER) $200M Investor Settlement

Late claims are being considered for compensation, subject to approval.

N.D. California

Court

3:19-cv-06361

Case number

05/10/2019

Class period Start

11/05/2019

Class period End

11/20/2024

Claim deadline

Uber (UBER) agreed to pay $200M to investors to settle claims related to its IPO, including financial losses, issues with bypassing local regulations, and safety concerns.

Outline:

In 2019, Uber went public and raised over $8.1 billion. Soon after, the company faced major financial losses and several accusations. Uber was criticized for bypassing local regulations in many areas and for ignoring serious safety issues, including sexual assaults, deaths from crashes, and fatal assaults before the IPO.

Timeline:
On May 9, 2019: Uber went public and raised over $8.1 billion. 
On August 8, 2019: Uber reported a $5.24B loss and $2.87B revenue for Q2 2019. Ridesharing revenue grew just 2%, while expenses rose by $507M.
After these results, $UBER fell by over 20%.
On October 4, 2019: Uber faced a lawsuit from investors.
Background:

In May 2019, Uber's IPO raised over $8.1 billion by selling more than 180 million shares at $45 each.

In Q2 2019, the same quarter as its IPO, Uber reported a massive $5.2 billion loss, one of the largest in its history. The company said $3.9 billion of this was due to stock-based compensation for early investors, but even without that, the loss was $1.3 billion.

Then, Uber's Q2 2019 results showed slower growth than expected, with GAAP revenue up 14% and adjusted net revenue up 12%. Trips and monthly active users grew by only 35% and 30%, among the slowest in the company's history.

After that, Uber faced several accusations.

First, Uber's past and present success was based on a hidden and unsustainable business model that often involved illegal practices.

Former employee revealed that Uber’s launch strategy involved quickly setting up in new cities and bypassing local regulations. From 2017 to 2019, Uber allowed drivers in Tanzania to operate without required licenses, leading to police arrests of employees.

The employee also explained that Uber used the same illegal operating strategy in many high-growth markets, including India, Latin America, Brazil, Singapore, and China.

Second, Uber overlooked major safety issues to fuel its growth. 

In the two years before its IPO, the company reported 5,981 sexual assaults, 107 deaths from crashes, and 19 fatal assaults in the U.S.

Moreover, Uber promised investors growth now and profits later, but its "growth at any cost" approach was flawed and hid its true financial state. 

As a result, Uber faced a lawsuit from investors over disappointing financial results and misleading statements about its prospects.

What can investors expect now?

Uber has agreed to pay $200M to investors to settle claims related to this situation.

If you were damaged due to this situation, you can file for a payout and get your share of the settlement. You can check if you are eligible and other details in the FAQ section below.

Case Status

Accepting Late Claims

Alleged Offence

Mismanagement,

Misleading Statements,

Omissions

Suspected Party

Directors,

Management

Security Type

Stocks

Trade Direction

Long

Filing date

10/04/2019

Plaintiffs

Boston Retirement System

Attorneys

Cotchett Pitre & McCarthy (Burlingame, CA), Labaton Sucharow LLP (New York, NY), Levi & Korsinsky LLP (New York, NY), Robbins Geller Rudman & Dowd LLP (Melville, NY), Scott+Scott Attorneys at Law LLP (San Diego, CA)

Defendants

Dara Khosrowshahi, Nelson Chai, Glen Ceremony, Ronald Sugar, Ursula Burns, Garrett Camp, Matt Cohler, Ryan Graves, Arianna Huffington, Travis Kalanick, Wan Ling Martello, Yasir Al-Rumayyan, John Thain, and David Trujillo

Judge

Richard Seeborg

Administrator

A.B. Data Ltd

Settlement agreement date

2024-07-19

Court hearing date

12/05/2024

Exclusion deadline

11/14/2024

Objection deadline

11/14/2024

Trades matching type

FIFO

+$200,000,000

Cash Settlement Amount

Frequently Asked Questions

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Do I have to sell securities to be eligible?

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