The mishandling of the medical document led to a second lawsuit from the woman this year. The Justice Department is now carrying out a
, which includes questions about how Alexander obtained the report, two people said. Alexander declined to comment through a spokesman. >criminal bribery probe at Uber
In 2015, Kalanick hired Sullivan, the former chief security officer at Facebook. Sullivan started his career as a federal prosecutor in computer hacking and intellectual property law. He’s been a quiet fixture of Silicon Valley for more than a decade, with stints at
and >PayPal before joining >EBay Inc. in 2008. >Facebook
It appears Sullivan was the keeper of some of Uber’s darkest secrets. He oversees a team formerly known as Competitive Intelligence. COIN, as it was referred to internally, was the caretaker of Hell and other opposition research, a sort of corporate spy agency. A few months after joining Uber, Sullivan shut down Hell, though other data-scraping programs continued. Another Sullivan division was called the Strategic Services Group. The SSG has hired contractors to surveil competitors and conducts extensive vetting on potential hires, two people said.
Last year, Uber hired private investigators to monitor at least one employee, three people said. They watched China strategy chief Liu Zhen, whose cousin Jean Liu is president of local ride-hailing startup Didi Chuxing, as the companies were negotiating a sale. Liu Zhen couldn’t be reached for comment.
Sullivan wasn’t just security chief at Uber. Unknown to the outside world, he also took the title of deputy general counsel, four people said. The designation could allow him to assert attorney-client privilege on his communications with colleagues and make his e-mails more difficult for a prosecutor to subpoena.
Sullivan’s work is largely a mystery to the company’s board. Bloomberg learned the board recently hired a law firm to question security staff and investigate activities under Sullivan’s watch, including COIN. Sullivan declined to comment. COIN now goes by a different but similarly obscure name: Marketplace Analytics.
As Uber became a global powerhouse, the balance between innovation and compliance took on more importance. An Uber attorney asked Kalanick during a company-wide meeting in late 2015 whether employees always needed to follow local ride-hailing laws, according to three people who attended the meeting. Kalanick repeated an old mantra, saying it depended on whether the law was being enforced.
A few hours later, Yoo sent Kalanick an email recommending “a stronger, clearer message of compliance,” according to two people who saw the message. The company needed to adhere to the law no matter what, because Uber would need to demonstrate a culture of legal compliance if it ever had to defend itself in a criminal investigation, she argued in the email.
Kalanick continued to encourage experimentation. In June 2016, Uber changed the way it calculated fares. It told customers it would estimate prices before booking but provided few details.
Using one tool, called Cascade, the company set fares for drivers using a longstanding formula of mileage, time and demand. Another tool called Firehouse let Uber charge passengers a fixed, upfront rate, relying partly on computer-generated assumptions of what people traveling on a particular route would be willing to pay.
Drivers began to notice a discrepancy, and Uber was slow to fully explain what was going on. In the background, employees were using Firehouse to run
offering discounts to some passengers but not to others. >large-scale experiments
>“Lawyers don’t realize that once they let the client cross that line, they are prisoners of each other from that point on”
While Uber’s lawyers eventually looked at the pricing software, many of the early experiments were run without direct supervision. As with Greyball and other programs, attorneys failed to ensure Firehouse was used within the parameters approved in legal review. Some cities require commercial fares to be calculated based on time and distance, and federal law prohibits price discrimination. Uber was sued in New York over pricing inconsistencies in May, and the case is seeking class-action status. The Justice Department has also opened a criminal probe into questions about pricing, two people familiar with the inquiry said.
As the summer of 2016 dragged on, Yoo became more critical of Kalanick, said three former employees. Kalanick wanted to purchase a startup called Otto to accelerate the company’s ambitions in self-driving cars. In the process, Otto co-founder Anthony Levandowski told the company he had files from his former employer, Alphabet, the people said. Yoo expressed reservations about the deal, although accounts vary on whether those were conveyed to Kalanick. He wanted to move forward anyway. Yoo and her team then determined that Uber should hire cyber-forensics firm Stroz Friedberg in an attempt to wall off any potentially misbegotten information.
Waymo sued Uber this February, claiming it benefited from stolen trade secrets. Uber’s board wasn’t aware of the Stroz report’s findings or that Levandowski allegedly had Alphabet files before the acquisition, according to testimony from Bill Gurley, a venture capitalist and former board member, as part of the Waymo litigation. The judge in that case referred the matter to U.S. Attorneys. The Justice Department is now looking into Uber’s role as part of a criminal probe, two people said.
As scandal swirled, Kalanick started preaching the virtues of following the law. Uber distributed a video to employees on March 31 in which Kalanick discussed the importance of compliance. A few weeks later, Kalanick spoke about the same topic at an all-hands meeting.
Despite their quarrels and mounting legal pressure, Kalanick told employees in May that he was promoting Yoo to chief legal officer. Kalanick’s true intention was to sideline her from daily decisions overseen by a general counsel, two employees who worked closely with them said. Kalanick wrote in a staff email that he planned to bring in Yoo’s replacement to “lead day to day direction and operation of the legal and regulatory teams.” This would leave Yoo to focus on equal-pay, workforce-diversity and culture initiatives, he wrote.
Before Kalanick could find a new general counsel, he
resigned under pressure from investors. Yoo told colleagues last month that she would leave, too, after helping Khosrowshahi find her replacement. He’s currently interviewing candidates. Yoo said she welcomed a break from the constant pressures of the job. “The idea of having dinner without my phone on the table or a day that stays unplugged certainly sounded appealing,” she wrote in an email to her team.
The next legal chief won’t be able to easily shed the weight of Uber’s past. “Lawyers don’t realize that once they let the client cross that line, they are prisoners of each other from that point on,” said Marianne Jennings, professor of legal and ethical studies in business at Arizona State University. “It’s like chalk. There’s a chalk line: It’s white; it’s bright; you can see it. But once you cross over it a few times, it gets dusted up and spread around. So it’s not clear anymore, and it just keeps moving. By the time you realize what’s happening, if you say anything, you’re complicit. So the questions start coming to you: ‘How did you let this go?’”
Watch This Next: Uber Board Said Considering Limit on Ex-CEO’s Power
Uber Board Said Considering Limit on Ex-CEO's Power
This is source I found from another site, main source you can find in last paragraph
Source : https://www.bloomberg.com/news/features/2017-10-11/uber-pushed-the-limits-of-the-law-now-comes-the-reckoning