How Uber's Legal Department Can Improve Its Board Relationship
With the hiring of former Expedia Inc. CEO Dara Khosrowshahi, Uber Technologies Inc. has taken an important first step in engineering a turnaround.…
September 05, 2017 at 07:26 PM
5 minute read
The original version of this story was published on Law.com
With the hiring of former Expedia Inc. CEO Dara Khosrowshahi, Uber Technologies Inc. has taken an important first step in engineering a turnaround. Critical next moves for Khosrowshahi seem to be managing his relationship with the company's board of directors—which still includes ex-CEO Travis Kalanick—and filling vacancies in the executive ranks, including the general counsel spot.
But it isn't just Khosrowshahi who needs to think about how to interact with the board. The relationships between board members and the company's in-house attorneys, particularly Salle Yoo, Uber's chief legal officer, as well as the company's yet-to-be-named general counsel, will become all the more relevant as the company works on repairing recent damage, according to attorneys who do not have direct knowledge about Uber.
One area where the board will likely play a role is in the search for a new general counsel at Uber. The company, which has been without a GC since Yoo was promoted to CLO in May, did not respond to a request for comment about the legal department's interactions with the board.
William Ide, a partner at Dentons and former senior vice president and GC of Monsanto Co., said that management will likely “run the process” in the selection of the incoming general counsel, but the board will have final approval. He said in a typical situation, a search firm and the human resources department might be involved and “the board would be informed” by their work.
Ide explained, “The thoughtful approach would be to get a short list and then have key board members involved with interviews before final decisions are made, but often you'll see management sort of take the whole process and then come to the board [and say]: Here's the person we'd like to hire.”
Ide said, though it is uncommon, when a company is in crisis and the board has assumed more responsibilities, “they might be more active in selecting the GC if they think there's a particular need where there's been a problem” and the directors feel like “we've got to make sure we've got the right general counsel.”
Carrie Hightman, executive vice president and chief legal officer at utility company NiSource Inc., recalled that when she was hired roughly a decade ago, while the CEO took the lead in the selection process, the board was certainly involved in the ultimate decision. “I actually was flown out to meet the chairman of the board before I was officially hired,” she said.
Hightman said that, generally, the chance of the chairman rejecting a hire is miniscule. “It's really just about respect and authority and making sure that, you know, everyone's in the loop,” she noted.
When Yoo was promoted to CLO, an internal email from then-CEO Kalanick indicated that an external search would begin for a general counsel to “lead day to day direction and operation of the legal and regulatory teams” at the company. At least as of several months ago, then, the legal department's future included both a chief legal officer and a general counsel.
A legal function with both roles may mean that the new GC will not interact as frequently with Uber's board as is typical, some of the attorneys reached for this story said. They explained that the direct line of contact would most likely go to the CLO in this situation.
Whoever in the legal department takes on the primary role in interacting with the board, be it Yoo or the GC, it's important to establish a relationship of “trust and transparency,” Hightman said. The most senior legal officer should make it known to the board that they are on hand to respond to any crises and help create a culture in the boardroom where people feel comfortable speaking up, she explained.
“And I think it's about becoming a really good, trusted business partner,” said Hightman, adding that for the most senior legal exec, this is broader than just advising on what's legally appropriate and what's not. “This is much more about all of the other advising and consulting and partnering that he or she will do with the board,” she said.
Hightman added: “The more you do it rigidly as a lawyer, I think, the less effective you are with the board, generally.”
Michael Fricklas, former longtime general counsel of Viacom Inc., agreed that relationships with the board will be key for the incoming Uber GC. He said that “as a general counsel that's been in situations where there's a lot of conflict … the No. 1 thing they're going to have to do is establish [the] trust of the players.”
He admitted that this may be hard, but “the issue the company has right now is a series of trust issues and you have to address those, I think pretty loudly, but it's very hard to regain confidence that gets lost.”
“Fixing a messed up reputation is always tougher than keeping your reputation in the first place,” Fricklas said. “I envision that they're going to have to pretty quickly take some very strong steps to reassure the public and the management of their commitment to behaving like a responsible company.”
Stephanie Forshee can be contacted at [email protected]. Jennifer Williams-Alvarez can be contacted at [email protected].
This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.
To view this content, please continue to their sites.
Not a Lexis Subscriber?
Subscribe Now
Not a Bloomberg Law Subscriber?
Subscribe Now
NOT FOR REPRINT
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
You Might Like
View AllTrump Likely to Keep Up Antitrust Enforcement, but Dial Back the Antagonism
5 minute readFTC Sues Cash-Advance Fintech Dave, Says It Deceives the 'Financially Vulnerable'
Policy Wonks' Obsession: What Will Tuesday's Election Mean for FTC Firebrand Khan?
6 minute readTrending Stories
- 1Infant Formula Judge Sanctions Kirkland's Jim Hurst: 'Overtly Crossed the Lines'
- 2Trump's Return to the White House: The Legal Industry Reacts
- 3Election 2024: Nationwide Judicial Races and Ballot Measures to Watch
- 4Climate Disputes, International Arbitration, and State Court Limitations for Global Issues
- 5Judicial Face-Off: Navigating the Ethical and Efficient Use of AI in Legal Practice [CLE Pending]
- 6How Much Does the Frequency of Retirement Withdrawals Matter?
Who Got The Work
Michael G. Bongiorno, Andrew Scott Dulberg and Elizabeth E. Driscoll from Wilmer Cutler Pickering Hale and Dorr have stepped in to represent Symbotic Inc., an A.I.-enabled technology platform that focuses on increasing supply chain efficiency, and other defendants in a pending shareholder derivative lawsuit. The case, filed Oct. 2 in Massachusetts District Court by the Brown Law Firm on behalf of Stephen Austen, accuses certain officers and directors of misleading investors in regard to Symbotic's potential for margin growth by failing to disclose that the company was not equipped to timely deploy its systems or manage expenses through project delays. The case, assigned to U.S. District Judge Nathaniel M. Gorton, is 1:24-cv-12522, Austen v. Cohen et al.
Who Got The Work
Edmund Polubinski and Marie Killmond of Davis Polk & Wardwell have entered appearances for data platform software development company MongoDB and other defendants in a pending shareholder derivative lawsuit. The action, filed Oct. 7 in New York Southern District Court by the Brown Law Firm, accuses the company's directors and/or officers of falsely expressing confidence in the company’s restructuring of its sales incentive plan and downplaying the severity of decreases in its upfront commitments. The case is 1:24-cv-07594, Roy v. Ittycheria et al.
Who Got The Work
Amy O. Bruchs and Kurt F. Ellison of Michael Best & Friedrich have entered appearances for Epic Systems Corp. in a pending employment discrimination lawsuit. The suit was filed Sept. 7 in Wisconsin Western District Court by Levine Eisberner LLC and Siri & Glimstad on behalf of a project manager who claims that he was wrongfully terminated after applying for a religious exemption to the defendant's COVID-19 vaccine mandate. The case, assigned to U.S. Magistrate Judge Anita Marie Boor, is 3:24-cv-00630, Secker, Nathan v. Epic Systems Corporation.
Who Got The Work
David X. Sullivan, Thomas J. Finn and Gregory A. Hall from McCarter & English have entered appearances for Sunrun Installation Services in a pending civil rights lawsuit. The complaint was filed Sept. 4 in Connecticut District Court by attorney Robert M. Berke on behalf of former employee George Edward Steins, who was arrested and charged with employing an unregistered home improvement salesperson. The complaint alleges that had Sunrun informed the Connecticut Department of Consumer Protection that the plaintiff's employment had ended in 2017 and that he no longer held Sunrun's home improvement contractor license, he would not have been hit with charges, which were dismissed in May 2024. The case, assigned to U.S. District Judge Jeffrey A. Meyer, is 3:24-cv-01423, Steins v. Sunrun, Inc. et al.
Who Got The Work
Greenberg Traurig shareholder Joshua L. Raskin has entered an appearance for boohoo.com UK Ltd. in a pending patent infringement lawsuit. The suit, filed Sept. 3 in Texas Eastern District Court by Rozier Hardt McDonough on behalf of Alto Dynamics, asserts five patents related to an online shopping platform. The case, assigned to U.S. District Judge Rodney Gilstrap, is 2:24-cv-00719, Alto Dynamics, LLC v. boohoo.com UK Limited.
Featured Firms
Law Offices of Gary Martin Hays & Associates, P.C.
(470) 294-1674
Law Offices of Mark E. Salomone
(857) 444-6468
Smith & Hassler
(713) 739-1250