WeWork controversies
Controversies tied to this brand in public sources. A listing is not a finding of fault.
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2021
WeWork sues over Midtown lease and letter of credit
Lawsuit filed
In a complaint filed in New York State Supreme Court, WeWork claimed that the Chetrit Group threatened to draw down on a letter of credit tied to its 404 Fifth Avenue lease. WeWork also alleged that Chetrit wrongfully drew down a letter of credit for another lease the previous month. These are allegations made in the complaint; the source article reports no court determination on the claims.
Source excerpt
WeWork claims the Chetrit Group is threatening to illegally draw down on a multimillion-dollar letter of credit at its Midtown Manhattan location.
In a complaint filed in NewYork State Supreme Court, the flexible-office provider claims that its lease at 404 Fifth Avenue requires the landlord to first provide WeWork with a notice of default.
2020
WeWork sues SoftBank over terminated rescue plan
Lawsuit filed
WeWork sued SoftBank in a Delaware court, alleging that SoftBank breached its contractual obligations by withdrawing from a $3 billion rescue plan. According to the complaint, SoftBank acted after receiving most of the benefits under the deal. These are allegations reported in the source and do not constitute a court determination.
WeWork sued SoftBank in a Delaware court, claiming that SoftBank breached its contractual obligations by backing out of a $3 billion rescue plan. The complaint alleges that SoftBank acted after receiving most of the benefits under the deal; these are allegations reported in the source, not a court determination.
Source excerpt
The Special Committee is seeking specific performance requiring SoftBank to complete the tender offer or, in the alternative, compensatory damages for SoftBank’s breaches of contract and fiduciary duty.
The lawsuit is seeking a judge to either compel SoftBank to hand over the money, or at least pay a punitive breakup fee.
WeWork is suing SoftBank, its biggest VC backer, for reneging on a $3 billion tender offer of WeWork shares.
2020
WeWork special committee sues SoftBank over failed acquisition offer
Lawsuit filed
In April 2020, WeWork's special committee filed a lawsuit against SoftBank and its affiliates. The committee alleged that the defendants breached the Master Transaction Agreement by failing to complete the planned tender offer. It further alleged that the defendants breached fiduciary duties owed to WeWork's minority shareholders. The dispute centered on the acquisition offer that was not completed.
WeWork's special committee sued SoftBank and its affiliates, alleging they breached the Master Transaction Agreement by failing to complete the planned tender offer and breached fiduciary duties to WeWork's minority shareholders.
Source excerpt
In a lawsuit, WeWork accused SoftBank of putting "its own interests" first when it abandoned a plan to buy up to $3bn of shares from other investors.
A WeWork special committee, created last year to negotiate the rescue, on Tuesday accused Softbank of deliberately blocking the restructuring.
It said the Japanese investment giant's decision was a "clear breach" of its contractual obligations and called on SoftBank to complete the tender offer or pay alternative compensatory damages.
2020
WeWork committee challenges SoftBank over tender offer
Issue disclosure
WeWork’s board special committee said it was taking steps to ensure SoftBank completed its promised tender offer for employee and shareholder shares, and called failure to complete the purchase unethical. SoftBank responded that it continued to meet its agreement obligations but that conditions required for closing had not been met.
Company response
Clarification — SoftBank
软银在一份声明中回应称，它将“继续履行其在协议中的义务”，但是WeWork尚未满足达成交易所需的所有条件。
Source excerpt
WeWork的声明称:“软银已经向员工做出了无数次（收购股份）的保证，违背协议将是完全不道德的，尤其是在当前的环境下。
软银在一份声明中回应称，它将“继续履行其在协议中的义务”，但是WeWork尚未满足达成交易所需的所有条件。
2020
Lawsuit filed against WeWork alleging discrimination
Lawsuit filed
Ayesha Whyte sued WeWork, alleging gender and racial discrimination after the company demoted her and cut her pay. WeWork refuted the allegations and said it believed the claims were without merit.
Company response
Denial — WeWork
A spokeswoman for WeWork said the company refutes the allegations in the suit.
Source excerpt
A black attorney is suing WeWork for gender and racial discrimination after the company demoted her position and slashed her pay right after she was hired, according to a lawsuit filed Friday in Manhattan Supreme Court.
“At WeWork, we prioritize equal employment opportunity, including hiring, promotion and compensation, and believe these claims are wholly without merit,” spokeswoman Nicole Sizemore said in an email.
A spokeswoman for WeWork said the company refutes the allegations in the suit.
2019
Failed IPO and governance controversy
WeWork’s proposed IPO exposed large losses, extensive lease obligations, founder control, related-party transactions, and governance weaknesses. Investor criticism led to the withdrawal of the offering and Adam Neumann’s resignation as CEO.
2019
Workplace phone booths recalled over formaldehyde concerns
The company warned that approximately 1,600 phone booths in the United States and Canada might contain formaldehyde contamination after members reported irritation and strong odors; additional booths were considered for precautionary removal.
2019
Former employee files lawsuit against WeWork and SoftBank
Lawsuit filed
Former WeWork employee Natalie Sojka filed a class-action lawsuit contesting WeWork's alleged breach of workers' stock options. The suit also targets majority stakeholder SoftBank over its purchase of Adam Neumann's stock amid the cancellation of the company's IPO. WeWork stated that it believes the lawsuit is meritless.
Company response
Denial — WeWork
“WeWork believes this lawsuit is meritless,”
Source excerpt
Natalie Sojka, who according to her LinkedIn profile worked for the We Co. from September 2017 until February 2019, is also suing majority stakeholder SoftBank for buying out ousted CEO Adam Neumann’s stocks amid the IPO’s cancellation last month.
“WeWork believes this lawsuit is meritless,”
one of the company’s former employees filed a class-action lawsuit in California to contest the company’s breach of workers’ stock options.
2019
Shareholder sues over Adam Neumann exit package
Lawsuit filed
A WeWork shareholder filed a lawsuit over the nearly $1.7 billion exit package approved for former co-founder Adam Neumann. The lawsuit alleges that Neumann and SoftBank abused their control of the company to approve the deal at the expense of smaller shareholders. WeWork called the claims meritless.
A WeWork shareholder filed suit over the nearly $1.7 billion exit package approved for former co-founder Adam Neumann. The lawsuit alleges that Neumann and SoftBank abused their control of the company to approve the deal at the expense of smaller shareholders; WeWork called the claims meritless.
Company response
Denial — WeWork
WeWork called the claims "meritless".
Source excerpt
The lawsuit was filed in San Francisco Superior Court by Natalie Sojka, who worked for the company for one and a half years and received shares as part of her pay.
WeWork called the claims "meritless".
A WeWork shareholder has taken the company to court over the near-$1.7bn (£1.3bn) leaving package approved for ousted co-founder Adam Neumann.
2019
BIPA lawsuits filed against Juul and WeWork
Lawsuit filed
Juul and WeWork were named as defendants in potential class-action lawsuits in Illinois alleging violations of the Biometric Information Privacy Act's requirements for informing people about biometric-data collection, use and storage and obtaining written consent. The article says no misuse or theft of the information was alleged.
Source excerpt
A pair of companies known for their modern approaches to old behaviors and recent controversy are among the defendants in the latest batch of biometric privacy lawsuits filed in Illinois.
Like most of the multitude of suits filed this year under BIPA, both are potential class actions, and both allege that the requirements under the state’s Biometric Information Privacy Act to provide information about the collection, use and storage of biometric data from people, and obtain their written consent were violated.
As is almost always the case with BIPA suits, no misuse or theft of the information is alleged.
2019
WeWork employees express outrage over proposed Neumann payout
Public backlash
WeWork employees expressed indignation over a proposed payout to former leader Adam Neumann while employees faced the prospect of mass job cuts. The article reports employee reactions and does not establish a formal determination of wrongdoing.
Source excerpt
WeWork will narrowly avoid financial ruin and, in the process, reward its former leader, Adam Neumann, with as much as US$1.2 billion (S$1.6 billion). The reaction from his former colleagues, who are still facing the prospect of mass job cuts and a corporate crisis: "You've got to be kidding me."
Dozens of employees expressed indignation in interviews and messages to colleagues on company Slack channels that were relayed to Bloomberg.