WeWork co-founder Adam Neumann accuses SoftBank of abusing its energy in fresh lawsuit

WeWork co-founder Adam Neumann accused SoftBank Community of abusing its energy in a fresh lawsuit filed Monday that alleges breach of contract and breach of fiduciary duty for pulling a $3 billion gentle provide for WeWork shares.
The lawsuit, filed in Delaware Court docket of Chancery, included a movement to consolidate his case with a lawsuit filed final month by a Special Committee of WeWork’s board. Every complaints level of curiosity on SoftBank Community and its Vision Fund’s decision to again out of a deal to recall shares of the co-working firm.
SoftBank Community pulled its $3 billion gentle provide for WeWork shares April 1, citing COVID-19’s affect on the industrial but additionally closing stipulations not being met. Namely, it pointed to outstanding regulatory investigations, a rising body of litigation against the firm and the failure to restructure a joint venture in China as reasons to torpedo the agreement.
“SoftBank will vigorously defend itself against these meritless claims,” Have interaction Townsend, senior vp and chief officer at SoftBank, said in an announcement. “Below the terms of our agreement, which Adam Neumann signed, SoftBank had no responsibility to total the gentle provide by which Mr. Neumann – the supreme beneficiary – sought to sell virtually $1 billion in stock.”
A deal used to be struck in October 2019 to recall out likely the main equity held by Neumann, to boot to the venture capital Benchmark Capital and quite quite a bit of individual firm workers. Neumann used to be situation to receive nearly $1 billion for his shares.
WeWork and Neumann gave retain an eye on of the firm to SoftBank, which elevated its possession at a vastly reduced value, based totally totally on the criticism.
“SoftBank has abused its set of energy to “renege on its promise to pay [Neumann, shareholders, and hundreds of employees] for the advantages it already got,” the criticism said. The lawsuit claims that SoftBank used to be “secretly taking actions to undermine it” by pressuring traders now to not waive optimistic rights and combating the China roll-up transaction from closing.
The lawsuit extra alleges that SoftBank’s monetary condition influenced the firm’s decision to end the gentle provide.
The lawsuit alleges that SoftBank “abused its energy” after WeWork’s particular committee filed a lawsuit by insisting that handiest the board, which is controlled by SoftBank, might per chance presumably buy factual action.
“In true time, SoftBank Community and SoftBank Vision Fund are abusing their retain an eye on of WeWork so that you just can cease the Special Committee’s meritorious lawsuit from being heard,” the criticism reads.

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