Tech

Alphabet gets two-month delay to reply to shareholder lawsuit over executive misconduct

Key Points
  • Alphabet’s board of directors has asked for a two-month extension to respond to a shareholder lawsuit.
  • It comes as the company’s hired agencies conduct an investigation into sexual misconduct among executives.
  • It is the second extension the company has asked for.
Google CEO Sundar Pichai speaks during signing ceremony committing Google to help expand information technology education at El Centro College in Dallas, Texas, October 3, 2019.
Brandon Wade | Reuters

Alphabet has requested and received a two-month extension to provide a response to a shareholder lawsuit related to executive misconduct.

The company will have until Feb. 14, 2020, to respond to claims made in a shareholder lawsuit filed earlier this year that alleges Alphabet's board of directors mishandled claims of misconduct, according to court documents viewed by CNBC.

The latest extension comes one day before the company's expected deadline of Dec. 13, which had already been extended from Nov. 8 at Alphabet's request. It also comes weeks after CNBC reported that the board formed an independent subcomittee and law firm to investigate how executives handled claims of sexual harassment and other misconduct by chief legal officer David Drummond and other execs.

Alphabet shareholders sued the board in January for allegedly covering up sexual misconduct from executives, including former Android co-founder Andy Rubin. The company paid Rubin $90 million when he left in 2014, even though an internal investigation had found credible claims of sexual misconduct with employees, according to a report in the New York Times. Rubin denied any wrongdoing in statements at the time of the report. The report of Rubin's payout set off a company-wide walkout by employees last November.

Because there were multiple related shareholder lawsuits, the judge consolidated them into one joint-suit called Alphabet, Inc. Shareholder Derivative Litigation.

Alphabet's board then formed a Special Litigation Committee and hired law firm Cravath, Swaine & Moore to assist with an investigation into the alleged misconduct.

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Why Alphabet's investigating executives over inappropriate relationships