Uber in Crisis: The Bro-Culture’s Titanic

Complaints about Uber are nothing new. In 2014, as Uber was besieged by a privacy scandal, Pay Pal co-founder and Lyft investor Peter Thiel called Uber the “most ethically challenged company in Silicon Valley” and the Guardian asked the question “Is Uber the worst company in Silicon Valley?”

For Uber, those were the good old days as 2017 has been one scandal after another with people increasingly tying this to the leadership of its CEO Travis Kalanick and the “bro culture” that permeates Uber.

This matter was discussed more fully on Cyber Law & Business Report. (Show Notes)

Trump Travel Ban Fallout

As President Trump implemented his first Muslim Travel Ban, Uber drew fire for seeking to profit from an one-hour taxi strike in protest of the ban and because of Kalanick’s status on the President’s business advisory counsel. Over 200,000 users delete the Uber app in response, prompting Kalanick to break with President Trump.[1]

Sexual Harassment

In February, a blog post former Uber software engineer Susan Fowler detailing her year with Uber which includes allegations that her manager approached her for sex on her first day and multiple instances of sexism and sexual assault at the company goes viral. Uber responds by hiring former Attorney General Eric Holder to conduct an urgent investigation.[2]

The Fowler fallout included:

More than 100 female employee meet with Kalanick and urge him to acknowledge that the issues were systemic and do not require further investigation. In March, Board member Ariana Huffington denied sexual harassment was a systemic problem.^[3]
A New York Times expose based on interviews with more than 30 current and former Uber employees and review of internal records

paint a picture of an often unrestrained workplace culture. Among the most egregious accusations from employees, who either witnessed or were subject to incidents and who asked to remain anonymous because of confidentiality agreements and fear of retaliation: One Uber manager groped female co-workers’ breasts at a company retreat in Las Vegas. A director shouted a homophobic slur at a subordinate during a heated confrontation in a meeting. Another manager threatened to beat an underperforming employee’s head in with a baseball bat.[4]
Inspired by Fowler, former Uber data analyst Amy Vertino posted her experienceChauvinistic, racist and homophobic attitudes were far too normal at Uber. Once in a group chat, team members referred to a new Asian American recruit asslanty eye joe. It was normal for guys to refer to other guys as fags when they didn’t participate in private parties where sex and drugs were involved. It was normal for guys to openly refer to attractive female colleagues as sluts when they refused to go out with them.
A supervisor suggested that she wear heels to emphasize her buttocks and later called her “a whiny little bitch” in front of colleagues when she disagreed with one of his ideas.[5]
The firing of 20 employees in response to a Perkins Coie investigation of 215 staff complaints going back as far as 2012. Of the 215 claims, Uber said 54 were related to discrimination, 47 related to sexual harassment, 45 to unprofessional behavior, 33 to bullying and 36 to other types of claims. Uber took action in 58 cases, no action on 100 more but the investigations are continuing.[6]

Self-Driving Technology

In attempt to catch up to Google on self-driving cars, Uber hired Anthony Levandowski who had led Google’s self-driving car efforts (which it spun off to a separate entity Waymo). In February, Waymo sued Uber claiming Google/Waymo sues Uber claiming that Levandowski stole some 14,000 documents from Waymo, and that the information became the technological basis for Uber’s self-driving cars. Uber fired Levandowski after he asserted his Fifth Amendment privilege in the litigation and refused to cooperate.[7]

A federal judge has referred the case to the U.S. Attorney for potential criminal action.[8]

Unrelated to the lawsuit, data leaked showed that Uber’s self-driving car project was way behind Waymo. On average Uber cars needed a human to take over every 0.8 miles compared to once per every 5,000 miles for Waymo.[9]

Greyball

In March, the New York Times revealed the existence of Greyball, which is an Uber tool that uses data collected from the Uber app and other techniques to identify and circumvent officials who were trying to clamp down on the ride-hailing service. Uber used these methods to evade the authorities in cities like Boston, Paris and Las Vegas, and in countries like Australia, China and South Korea. Uber admitted to using the tool to target government officials, but subsequently stated it would no longer use it going forward. It is now the subject of a federal criminal investigation.[10]

iPhone Fingerprinting

Uber was almost banned from the iPhone for the practice called “fingerprinting” in which it assigned a persistent identity to iPhones to allow it be traced even after device was erased. This was intended to address user fraud but it was prohibited by Apples terms. To avoid detection, geo-fenced Apple’s Cupertino headquarters to obfuscate its code for people in that area. Apple eventually figured it out and Tim Cook called Kalanick to his office for a scolding.[11]

A Fish Rots At the Head

With each new scandal and as top management begins to flee[12], all eyes turn to Uber CEO Kalanick.

His own behavior added to the dumpster fire these past few months. His blowup at an Uber driving upset about pricing was caught on dashcam (see below).

In addition, his efforts to get his former girlfriend to lie about a business outing to a karaoke/brothel in Seoul only led her to speak out.[13]

Mitch Kapor, founder of Lotus and the EFF and an Uber investor, penned an open letter blasting the company and its management.

We are speaking up now because we are disappointed and frustrated; we feel we have hit a dead end in trying to influence the company quietly from the inside . . . Uber’s outsize success in terms of growth of market share, revenues and valuation are impressive, but can never excuse a culture plagued by disrespect, exclusionary cliques, lack of diversity, and tolerance for bullying and harassment of every form.[14]

[1] Uber C.E.O. to Leave Trump Advisory Council After Criticism, New York Times (Feb. 3, 2017).

[2] Uber Versus Women: A Timeline, Inc. (Mar. 28, 2017).

[3] Uber Versus Women: A Timeline, Inc. (Mar. 28, 2017).

[4] Inside Uber’s Aggressive, Unrestrained Workplace Culture, New York Times (Feb. 22, 2017)

[5] I am an Uber survivor, Medium (Feb. 24, 2017).

[6] Uber fires 20 employees after harassment probe, Reuters (Jun. 6, 2017).

[7] Uber Executive Invokes Fifth Amendment, Seeking to Avoid Potential Charges, New York Times (Mar. 30, 2017); Uber fires executive accused of stealing Google’s self-driving car secrets, The Verge (May 30, 2017).

[8] Timeline: Bad news keep piling on for troubled Uber, SFGate (May 12, 2017).

[9] Uber’s bad year: The stunning string of blows that continue to upend the world’s most valuable startup, Business Insider (May 7, 2017).

[10] How Uber Deceives the Authorities Worldwide, New York Times (Mar. 3, 2017); Uber faces criminal probe over the secret ‘Greyball’ tool it used to stymie regulators, Los Angeles Times (May 5, 2017).

[11] Uber’s C.E.O. Plays With Fire, New York Times (April 23, 2017).

[12] Uber Sees an Executive Exodus as It Faces Questions of Workplace Culture, New York Times (Apr. 12, 2017).