Alphabet settles shareholders lawsuits over sexual misconduct claims

Google’s parent company Alphabet has pledged a slew of measures, including a commitment of $310 million, to settle lawsuits by shareholders over its alleged mishandling of sexual misconduct by executives.

As part of the settlement, Alphabet said it will ensure that $310 million in funding goes toward diversity, equity and inclusion initiatives and over the next decade.

According to a report in Ars Technica on Saturday, Alphabet has even agreed to allow its board to assume more oversight roles in allegations of misconduct.

“We’re building on our current practice of prohibiting severance for anyone terminated for any form of misconduct, and expanding the prohibition to anyone who is the subject of a pending investigation for sexual misconduct or retaliation,” Eileen Naughton, Google’s Vice President of People Operations, wrote in an email to employees.

“Managers will also receive guidance instructing them on how misconduct should impact an employee’s performance evaluation, compensation decisions, and promotion outcomes,” Naughton said.

If there are allegations against any executives, a specialist team will be assigned and the results of any case will be reported to the Board’s Audit Committee.

Alphabet agreed to the settlement after investor groups filed lawsuits against the company in California in 2018.

They alleged that Alphabet breached its fiduciary duty to shareholders by giving a handsome severance package to senior executives accused of engaging in sexual misconduct.

The lawsuits were filed after reports emerged that several Google executives accused of sexual misconduct received heavy severance packages and got to leave the company quietly.

Among them was Android creator Andy Rubin was given a $90 million severance package, among other benefits, in 2014 even though Google found a sexual misconduct allegation against him was credible, according to a report in The New York Times.

Protesting the compensations Google gave Rubin and others, thousands of the company’s employees staged a walkout in 2018.

The new settlement with shareholders was filed on Friday in California Superior Court.