NEW YORK: A week after Uber announced it was suing its agency for ad fraud, the beleaguered ride-hailing app is itself being sued by an ad tech company claiming it is owed millions of dollars.
Uber initially filed a lawsuit against Fetch Media, a mobile ad agency owned by Dentsu, suing for breach of contract, fraud and negligence in relation to a contract to purchase and place mobile ads which directed potential riders to Uber’s own app.
“Fetch was running a wild west of online advertising fraud, allowing Uber ads on websites we wanted nothing to do with, and fraudulently claiming credit for app downloads that happened without a customer ever clicking on an ad,” Uber said in a statement.
Fetch retorted that the allegations were “unsubstantiated, completely without merit, and purposefully inflammatory so as to draw attention away from Uber’s unprofessional behaviour and failure to pay suppliers”.
James Connelly, Chief Executive at Fetch, said the agreement with Uber had been terminated months ago “after Uber stopped paying invoices for services provided by over fifty small business suppliers”.
And now, the Wall Street Journal reported, one of those suppliers, Phunware, is claiming that Uber failed to pay Fetch for five invoices that were needed to then pay it; Phunware is seeking $3.1m plus interest in settlement of the outstanding invoices.
Uber, which is itself seeking $40m in damages from Fetch, has withheld around $7m in payments so there may well be more lawsuits to come.
Three months ago, co-founder Travis Kalanick was forced to stand down as CEO amid a blizzard of complaints about Uber's workplace culture, with reports of bullying, gender discrimination and sexual harassment.
The issue of how the company is run resurfaced a week ago when Transport for London decided it was not “fit and proper to hold a private operator licence” and would not be renewing its current licence which expires tomorrow (September 30).
Dara Khosrowshahi, the new chief executive, is challenging that assessment but has also acknowledged that Uber has not always got things right and apologised for the mistakes it has made.
Sourced from Wall Street Journal, Guardian; additional content by WARC staff