Alphabet board sued over massive payout to Android creator, among others

Exterior of Google office building.
Enlarge/ At the November 2018 walkout, some protestors shouted, “Time is up!”
Cyrus Farivar

Alphabet’s board of directors was suedtwice in California state court on Thursday by different investors making largely the same claim: that the company breached its fiduciary duty when it allowed alleged rampant sexual misconduct by top male executives to persist.

In particular, the lawsuits called out the way that Andy Rubin, the celebrated creator of Android, was ushered out of the company in 2014. (Alphabet is Google’s parent company.)

Despite being credibly accused of sexual misconduct against a co-worker, Rubin was still given a $150 million stock grant, to be paid out over several years, along with a $90 million exit package, according to a New York Times report from last year.

Rubin was also “alleged to have engaged in human sex trafficking”: in an October 2018 lawsuit brought by his ex-wife, Rie Rubin, she claimed that Andy Rubin had multiple “ownership relationships” with several highly paid women. In text messages produced in that case, Andy Rubin allegedly claimed that he could “loan” these women as they were “kinda like… my property.”

The cases—James Martin v. Lawrence Page et al and Northern California Pipe Trades Pension Plan v. John Hennessey et al—were both filed in San Mateo County Superior Court.

These two lawsuits are known as “shareholder derivative suits” and are brought by investors against Google’s board of directors individually for allegedly mismanaging company resources. Any damages recovered would go back to Google itself and theoretically be paid back to shareholders.

Martin’s lawyers specifically described the Rubin payout as “corporate waste,” while lawyers representing the pension plan called it “wasteful and excessive.”

Andy Rubin’s attorney, Ellen Winick Stross, did not immediately respond to Ars’ request for comment late Thursday but sent a statement to Bloomberg.

“This lawsuit, like much of the recent media coverage, mischaracterizes Andy’s departure from Google and sensationalizes claims made about Andy by his ex-wife,” Stross wrote. “Andy left Google voluntarily. Andy denies any misconduct, and we will vigorously defend him against these baseless claims.’’

In the civil complaint, Martin and his lawyers also accused Google of an egregious double-standard, echoing a complaint raised by frustrated workers who led and participated in a massive worldwide walkout late last year.

“If you were a high‐level male executive at Google responsible for generating millions of dollars in revenue, Google would let you engage in sexual harassment. And if you get caught, Google would keep it quiet, let you resign, and pay you millions of dollars in severance,” the lawsuit argued. “On the other hand, if you were a low‐level employee at Google and were accused of sexual harassment or discrimination, you would be fired for cause with no severance benefits. In this way, Alphabet and the Board were able to maintain optics and superficial compliance with its code of conduct, internal rules, and laws regarding sexual harassment.”

Google did not respond to Ars’ request on Thursday evening for comment.

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