Trump Campaign ChairPaul Manafort has stepped down. The unexpected resignation comes after the Campaign Announced a major shakeup, the second leadership reshuffle in two months. Manafort had also come under increasing scrutiny due to his past consulting for the former prorussian president of ukraine. Trump said in a statement he expected the resignation. The death toll from the terror attack in the french resort town of nice is now 86. The latest victim had been at a hospital, and died from injuries sustained during the july 14 massacre. He is the second hospitalized person to die in the attack. Dozens more were injured when a tunisian living in france drove a truck into a crowd of people celebrating bastille day. Islamic state claimed responsibility. Global news 24 hours a day, powered by 2600 journalists in more than 120 countries. I am Ramy Inocencio. Emily i am emily chang, and this is bloomberg west. A disappointment in court for uber after a california judge rejected a settlement with drivers. Does it open the door to a trial . Are there any Silver Linings . We will discuss. And it could be the biggest leak at the nsa since the 2013 revelations of Edward Snowden. We will introduce you to the shadow brokers. And signs that xiaomis grip on the chinese Smartphone Market is slipping. We will hear from Vice President of Global Operations hugo barra about the outlook at home and abroad. First to our lede. Lyft fails to find a buyer, according to the new york times. They have been said to approach several parties about a sale. Apple, google, amazon, uber, and didi, although the most serious conversation happened with general motors. Although they are not in immediate danger of closing, one source said they are unprofitable but they had a cash cushion of 1. 4 billion. This comes after a report that lyft rebuffed a takeover offer from gm. We are here with brad stone and joel rosenblatt. I want to start with you, brad. What is your analysis of lyft, trying and failing to sell itself, to a lot of different companies, including the archrival . Brad not a great report for lyft, but it has been a great month for uber. They did deal in china with didi, and this week they announced the rollout of the Autonomous Vehicle program in pittsburgh. Lyft is challenged. Theres a lot of ambiguity around its business. Can it be a profitable number two in the u. S. . What does the market look like when companies have to get into profitability and they cant keep sinking money into discounts . It is not surprising that with all the uncertainty around the real strength of the business, buyers would be a little hesitant right now. Emily lyft did have a Global Alliance with didi in other places. Brad its a great level of uncertainty. The ceo of didi now sits on ubers board. So lots of questions about whether lyft, if that alliance is still in play and if it will impact the business. Emily lets talk more about the lawsuit. We got the news yesterday, but we are trying to digest what this means for uber. A judge, joel, has rejected a 100 million settlement that uber struck with drivers over a classaction suit in california. How big of a blow is this to uber . Joel it is not a blow, because in fact, theres some indications to me that uber was agitating for this to happen. The reason it is not a blow is because, after they made the settlement, the ninth circuit agreed to hear ubers arguments that its arbitration clause should apply to its drivers, so now they can bet on this ruling, which seems to be forthcoming, its not a sure thing, but they are betting the ninth circuit will uphold the arbitration clause, pushing all these drivers into private oneonone arbitrations and decimating the classaction. Let me add to that. The big legal story, as i understand it, is this probably decadeslong trend in the u. S. Courts to limit the rights of workers to organize and sue companies as class actions, and what companies have been doing is establishing arbitration clauses with not only employees, but also customers, and saying if you have a complaint, you have to take it up with the company in private arbitration. Courts over and over have been applauding these rules, and the reason, my sense is the reason that the drivers attorneys settled was that the ninth circuit here in san francisco, the federal court of appeals, was indicating they were going to basically dissolve the classaction, in which case you dont have 400,000 drivers, you have Something Like a thousand people, drivers savvy enough to opt out and not sign the arbitration clause. So the settlement falls apart, but uber, like all the companies, still holds the upper hand, because its ambiguous whether drivers are even allowed to sue them in this way. Jill, tell me if you think thats right. Joel i think thats right. I think there is a little wrinkle in this case that poses potentially a very big threat for uber, which is that whatever the ninth circuit rules doesnt apply to lawsuits in state court under a special law, unique to california, in which they, the drivers could bring substantial penalties, very big penalties under labor laws. So, the supreme court, if they were to take this out, that would apply to these drivers, but the ninth circuit ruling does not do the job for uber. This settlement falling apart opens the box, kind of rips the lid off of a bunch of lawsuits in state courts, where the cases can go forward and cause a problem. Emily so the best Case Scenario for uber, this means drivers cannot sue as a class action, and would have to sue them oneonone . Joel we are not there yet, but thats the best Case Scenario. Emily the worst case for uber, the settlement is billions and billions of dollars, because the reason the judge rejected the lawsuit, he said the amount you would have to pay in reality is far greater than this. Joel and then the Appeals Court somehow does not overturn the District Courts ruling that the drivers can band together, and the new have this potential multibilliondollar settlement. But history is not on the side of the drivers. These class actions have been overturned again and again. Even in the case of federal express, which joel might have a better understanding, it went through this with its drivers which are also classified as contractors, and the plaintiff attorneys won that case but there was not much in the way of change. They changed a few things. Fedex drivers are still contractors. Not much changed. Emily they certainly dont get tips. Thank you. Brad stone, you will join me a little later in the show. Joel rosenblatt, our legal reporter, thank you so much for breaking down this very complex story. More about uber, making plenty of other news this week. On thursday it launched an Autonomous Car pilot in pittsburgh, beating out the automakers and major tech players like google and apple. We will hear from one investor who has had a long relationship with uber. David cohen was part of ubers angel round before they had a single car on the road. Carolyn caught up with him. Caroline the start of accelerator and Development Program has been here in berlin for more than a year now. David cohen, the founder, was stopping to the city and told us some wise words he tells to entrepreneurs in germany, and also about a very savvy investment he made years ago. That was being one of the first in uber. David i was talking to the companies. Several of them were practicing their pitch, talking about what they do, very germanspecific. I tell them, you are a player on the world stage, you know. This may be where you are starting, but you need to Frame Division as a global vision. Frame and the vision as a global vision. What you are doing matters. You are not just competing in one local market, one local language. So they will probably say, it is website dot de, but i say it is just website. Its a mentality that you are in the environment in germany all the time, and thats what you are thinking about, but in order to be truly competitive, we teach them to think more globally. Thats one thing that i noticed. Caroline is that relevant within the United States . David the u. S. Is a big market, so a lot of people, by comparison, it is more reach. So people assume, when they hear a pitch in the u. S. , that it is a Global Company to begin with. When i first heard the uber pitch, where i am a super early investor, it was focused on san francisco, but you knew that the aspiration was always global. It is sort of in the language, and you hear it in subtle ways, and here it is the opposite. Maybe sometimes you have too much market focus on one country, one language, one region, and you try to coach that out of them. Caroline you say the hottest deal is not always the best deal. Is uber still a great investment . David if you are investing today, no idea. If you were investing when i did in the angel round, good deal. You never know, but so far, so good. It was not a hot deal when i invested in it. Ryan graves, who i met early on, the first employee, was mentoring at techstars and they did not have any cars on the road, it was just an idea, but you were excited by the people and the vision. It didnt seem any better than any of the other investments are made the day i made them, so i was just fortunate to be involved. Caroline when you look at how uber is trying to navigate these markets, the regulatory environment, what can europe do . Is europe listening . Is the regulation playing ball . They are already in berlin, and having some pushback against uber, against airbnb. David when i came here, i ended up in a taxi, but it was an uber taxi, so at least they are on the platform. Therefore, its a little more challenging to get around here. I think, you know that some of the customs for us, coming here even as an example, we have spent more on dealing with the customs and the legal then we have anywhere else in the world. We are in a lot of places in the world. So just the processes in place. I dont think its intentional. It is just an artifact of how the systems developed, but it sure feels some things could be simplified to support business that wants to be here. Caroline does that take the businesses, as uber is, as other local companies are, going out and speaking and lobbying . David that ends up happening. One of the reasons it over one of the reasons uber has raised so much money is it is able to go out and convince people that this is safer, this is better, and anyone who has used the Service Knows it is. Its a Great Innovation to have the ability to do it on demand like that. But i think you will be able to see a lot of money poured into convincing the world this is a good thing. Caroline should go public this year . Should uber go public this year . David i doubt it will. Who am i to say what it should do . It would be nice to have some liquidity from getting so lucky with the early investment. Im sure a lot of people feel that way. Its a very substantial company now, but a lot of people feel it still has upside, and obviously a lot of money is being poured into it. Caroline what was one company you wish you had had as a techstar company or are the proudest that it has been a techstar companies . David there are so Many Companies you are excited to be associated with, companies that will hopefully eventually the multibilliondollar public companies. Digital ocean, class pass, theres just so many. Bb8 in the star wars movie, that came out of techstars. Huge growth. Would have been great if uber went through our accelerator. We were able to invest in it through our early venture fund, but we are just thrilled to be involved with so many Great Companies that change the world and make it a better place. Emily caroline hyde, speaking with techstars cofounder david cohen. Uber has been exceptional for a few reasons. The mega valuations. But after didis takeover of the companys china operations, they now share a investor with their biggest rival. That is a rare phenomenon, as investors generally do not back competing startups. Lets take a look. Ride hailing has seen explosive growth in recent years, making it one of the most lucrative segments in the tech startup space. Together, the five biggest ride halos are valued at 115 billion dollars. By now, all kinds of backers have a slice of the ride hailing pie, even nontraditional investors like toyota, general motors, and apple. But a small group of 15 investors are in really deep with not one, but several stakes in the biggest ride hailers. Softbank has invested in india, southeast asia, and the leading ride hailer in china. Another hedge fund has stakes in didi and lyft. And didi now has been interest in every major ride hailer, including its biggest competition, uber. Some of this was an attempt to fight back against the dominance of uber, who operate in 76 countries, lending firepower to rivals in regional markets. Why does it matter . We know the recent sale of ubers business in china was first explored by investors who wanted a truce with didi in that market, and now after that multibilliondollar deal, the Global Dynamics of the ride hailing market are in flux, and investors could see competing interests clash and there could be more consolidation. Can uber still win big if it is sharing investors with its rivals . Emily coming up, it could be the biggest, most dangerous nsa leak since Edward Snowdens massive disclosure in 2013. We go to washington next. This is bloomberg. Emily it could be the National Security agencys most significant leak of secret since Edward Snowden blew the lid off of their surveillance tactics in 2013. This Group Calling themselves shadow brokers posted two major files online, one is a freeforall of tools and techniques the nsa compiled to break past Computer System firewalls, including at Companies Like cisco and juniper. The other, according to the group, is an advanced set of Cyber Weapons that is encrypted and available to the highest bidder. There is still a lot we dont know about the leak and motivations behind it, but the information now out there could have serious repercussions for the companies that build the security infrastructure that the nsa apparently knows how to disarm. Our correspondent joins us from washington to explain. Theres a lot we dont know here. Most importantly, just how this information was obtained. Was it in inside job, an outside job . Some combination of inside and outside . Its true. Its very different than three years ago, when we found it about the snowden leaks. That was very easy. He came forward, and we knew how it happened. But theres a lot we dont know about this whodunit. First of all, it is really hard to hack into the nsa directly, so thats ruled out by a lot of analysts and security firms we spoke with. Theres a lot of theories floating around. One could be that an nsa hacker left this toolkit of really prized code in a server they had been into, and maybe did not cover their tracks well enough, and an outside group was able to go in and get that. Will another theory is, maybe even more nefarious, some but he had a usb drive and took it out physically from the nsa. These are a couple theories floating around, but we dont have anything for sure. The nsa has not confirmed. But its most likely not a direct hack into the nsa. Emily now, Edward Snowden has been tweeting about this, and of course we know that authorities have traced the hack of the dnc back to russian hackers. There is a suggestion that this could be russias way of warning the United States not to do anything further or retaliate, because russia potentially thinks we have meddled in russian elections. Snowden tweeted, why did they do it, no one knows. This may be in the calculus of how to respond to the dnc attacks, especially if they are targeting elections. Can you explain what snowden is trying to say here . Nafeesa we know snowden is currently in exile in russia. He came out with a series of tweets after the disclosure of these tools that were posted online by this group called shadow brokers, and he is perhaps insinuating that russia may be behind this week, because of it being linked to recent hacks on, say, the Democratic National committee, Hillary Clintons campaign. Because of that, he speculates it could be russia. In addition to that, we had analysts tell us as well, the countries and nation states that have this ability to do this level of hack and have the motivation to publicize it, kind of narrows down the list to russia and china. One analyst told me, the money is on russia but theres no hard evidence yet. If you look at motivation, look at the past track record, with russia being linked to some of the recent hacks we have seen that have been directly involved in the u. S. , thats what people are speculating it could be russia. But we still have a direct link yet. But at the same time, we have seen, we have seen russia being blamed for a lot of recent hacks, and there has been tension, hearing from highlevel u. S. Security officials who made a lot of public statements recently about russia, and there is tension with how putin is dealing with a lot of foreignpolicy issues. So we see that, and any time i talked to any Senior Security officials, they always say on the record, russia is among the top Cyber Security nationstate threats to the u. S. Emily a lot of questions still remaining about that data that is now up for auction, and just how dangerous the Cyber Weapons could be. Bloombergs Nafeesa Syeed in washington, thank you. We will be right back. Emily a story we are watching, a texas man who said the a