Illustration: Eniola Odetunde/Axios
Adam Neumann, founder and former CEO of WeWork, yesterday filed suit against SoftBank, alleging breaches of contract and fiduciary duty related to SoftBank's decision to walk away from a $3 billion tender for WeWork shares.
Why it matters: Because when a special committee of WeWork's board filed a similar lawsuit last month, SoftBank responded by questioning its standing to represent minority shareholders who could have participated in the tender offer. Neumann is unquestionably a minority shareholder.
Primary source: Read the lawsuit
What SoftBank is saying: “SoftBank will vigorously defend itself against these meritless claims. Under the terms of our agreement, which Adam Neumann signed, SoftBank had no obligation to complete the tender offer in which Mr. Neumann – the biggest beneficiary – sought to sell nearly $1 billion in stock.”
The bottom line: The most damning allegation in Neumann's complaint is that SoftBank unilaterally amended its agreement with WeWork late last year, reversing the sequencing of new debt financing and the stock tender. Neumann claims that SoftBank tried to negotiate the amendment with him but, when unable to reach agreement, SoftBank "simply removed Plaintiffs’ signature block from the document."