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Google board sued for hushing misconduct claims about Rubin

Mark Bergen, Joel Rosenblatt and Kartikay Mehrotra

Bloomberg

 /  Fri, January 11, 2019  /  06:01 pm
Google board sued for hushing misconduct claims about Rubin

Andy Rubin created Android, now the world’s most popular operating system, and ran the powerful mobile division at Google for years before leaving the company in 2014. (Bloomberg/File)

Alphabet Inc.’s board of directors was sued by a shareholder for “quietly” approving a $90 million exit payment to Andy Rubin, the creator of the Android mobile software, and protecting other executives accused of sexual harassment.

The investor claims the Google parent’s board failed in its duties by allowing the harassment to occur and covering up Rubin’s behavior, as did the company’s top executives and committee members, including co-founders Larry Page and Sergey Brin, venture capitalist John Doerr, investor Ram Shriram and Alphabet Chief Legal Officer David Drummond, among others.

“Rubin was allowed to quietly resign by defendants Larry Page and Sergey Brin after an internal investigation found the allegations of sexual harassment by Rubin to be credible,” according to the complaint filed Thursday in California state court. “While at Google, Rubin is also alleged to have engaged in human sex trafficking -- paying hundreds of thousands of dollars to women to be, in Rubin’s own words, ‘owned’ by him.”

Rubin created Android, now the world’s most popular operating system, and ran the powerful mobile division at Google for years before leaving the company in 2014. In October, The New York Times reported that Google executives approved a four-year, $90 million pay package for Rubin after an employee accused the executive of sexual harassment.

Read also: Google says fired 48 for sexual harassment over two years

Employee walkout

The findings about Rubin reverberated inside the technology giant. In November, thousands of Google employees staged a work walkout to protest the company’s approach to workplace sexual misconduct, prompting management to change its policies to make arbitration optional for harassment and sexual assault claims, and giving the workers the option to instead seek redress through the courts.

The shareholder suit is the first critique aimed directly at the Alphabet board. The New York Times reported that members of Google’s board approved Rubin’s stock grant in 2014 after an inquiry into the allegations against him began.

Google is also accused of handling the resignation of executive Amit Singhal in a similar fashion, allowing him to “quietly resign” in 2016 amid sexual harassment claims. Google never disclosed the reason for his departure, according to the complaint, though he was also paid millions in severance.

Singhal was fired from Uber Technologies Inc. in 2017 for failing to disclose the allegations he faced at the Mountain View, California-based company, where he was the longtime head of the powerful search division.

Read also: Google workers walk out in global protest over harassment

‘Credible’ allegations

The board’s audit and compensation committees, comprising nine members, along with Page, Brin and Schmidt, reviewed the findings of an investigation into allegations against Rubin in 2014. All nine directors were informed that ”the allegations were credible,” according to the complaint.

”The conduct of Rubin and other executives was disgusting, illegal, immoral, degrading to women, and contrary to every principle that Google claims it abides by,” according to the complaint.

A representative for Rubin, who has disputed the harassment claims, didn’t respond to a request for comment. Singhal didn’t respond to a request for comment.

Google told staff in October that it dismissed 48 people for sexual harassment in the past two years without exit packages.

Representatives of Google and John Doerr declined to comment. John Hennessy, the board chairman, and board members Ann Mather, Roger Ferguson and Diane Greene didn’t respond to requests for comment.

The lawsuit was filed Louise Renne, a one-time San Francisco City Attorney and former member of the city and county’s Board of Supervisors who’s now in private practice. Her co-counsel, Ann Ravel, was a commissioner for the Federal Election Commission under the Obama administration.

The complaint is a derivative case filed on behalf of the company against its board of directors, which means any damages recovered by the plaintiff would go back to Google. The goal of the suit is to improve corporate governance, according to Renne.