The suit, by shareholder James Martin, stems from revelations a year ago that the company awarded a $90 million (roughly Rs. 630 crores) exit package to executive Andy Rubin, the creator of the Android operating system, even as Rubin was being pushed out over sexual misconduct.
Reuters reported that in two lawsuits that were filed by investors this week, they claimed that the board of Alphabet failed in its duties by not tackling sexual harassment within the firm, approving massive payouts and acting to cover up the allegations.
Commenting on Martin's lawsuit, some of the staff involved in organizing the October walkout released a statement Thursday, slamming the Google board for not having the employees' "best interests at heart".
According to the plaintiff, the lawsuits seek to force Google to change its governance and stop future misconducts.
The suit says the board found the harassment allegations to be credible, but allowed Rubin to resign quietly with the $90 million severance package to "ensure his silence" and avoid a wrongful termination lawsuit that would have resulted in negative publicity about alleged harassment within the company. "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".
A lawsuit filed this week in California sees an Alphabet shareholder suing Alphabet. It eventually prompted Google to amend its workplace policies and give employees the option to directly approach courts for sexual conduct-related issues.
Google CEO Sundar Pichai was forced to apologize a year ago to employees over how the company handled sexual misconduct claims. It was not clear at that time exactly how much the board of directors knew about the allegations or Google's decision to make the payment to Rubin.
Given CEO Sundar Pichai has already announced that there will be no more forced arbitrations, that last point may not be too necessary, and it may reach another sticking block on different ambitious aim: asking executives to return their exit packages.
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 past year. "Andy left Google voluntarily and, in the severance negotiations there was no mention of a harassment complaint". "And fallout from the purported scandal led to billions of dollars in losses to Alphabet's value in the stock market, lawyer Frank Bottini said at a press conference in San Francisco".