Why Lyft/Uber Settled Without Taking Money

The legal dispute between Uber and Lyft — complete with accusations of spying flung back and forth and a reported hack by a former employee — ended in a settlement last week.

However, the settlement reportedly happened without either side actually forking over any money, according to a Reuters report that cited sources said to have knowledge of the matter.

This case involved top executives from both Uber and Lyft, which have now avoided going to trial as part of a litigation settlement. But there’s likely a good reason why.

This settlement came at the same time that reports came out that Lyft was working with Qatalyst Partners to make business deals, which could have even been discussions about a possible sale, Reuters reported. Agreeing to settle, in this case, could be one indication that Lyft is trying to make a major deal, since litigation could be a red flag for potential suitors.

This litigation involved former Lyft COO Travis VanderZanden in California; Lyft alleged that he broke confidentiality pledges when going to work for Uber. In the Uber case, the company withdrew a subpoena over a data breach incident that reportedly had been attached to an internet address for Lyft’s CTO, according to court filings.

This breach was first reported in May 2014 when it came to light that the DOJ was conducting a criminal investigation determining if Lyft employees were involved in the breach. Lyft itself said it could not find any evidence that its employees were connected, but as a Reuters article points out, there could be civil action taken.

VanderZanden had served as Lyft’s COO until Aug. 2014, when he expressed issues with the leadership and asked to take over as CEO. Instead, Lyft’s cofounders only accepted his resignation, and he became VP of international growth for Uber. As a result, he was sued by Lyft. Eventually, Lyft dropped the case against VanderZanden.