Kayak: New IPO, same conflict of interests

Yesterday I delved into the IPO filing of online travel company Kayak, and why its worries about the ITA/Google merger are well-founded (from a financial perspective).

One thing I failed to address, however, was the continuing oddity of General Catalyst partner Joel Cutler serving as a board member of both Kayak and ITA. I first wrote about the beyond-obvious conflict last month, and how Kayak's non-response response was as follows:

"KAYAK is an independent company with an obligation to do what is in its best interests. Mere common ownership interest by a VC is not a conflict. The two companies share only one common director, and to the extent that director has a conflict, he has an independent obligation to fulfill his fiduciary duties. He is one of 7 directors at KAYAK."

Actually, a real non-response came from General Catalyst, which never returned my calls (and here I thought we were all Boston buds -- maybe they just don't want me to ask about the firm being added as a defendent to that Cash4Gold-related lawsuit).

Let's be clear: There is no reasonable way for Cutler to fully honor his fiduciary duties to both Kayak and ITA. Not only is he a Kayak board member, but he also chairs the company's audit and compensation committees. Does he just leave the room every time ITA comes up as an issue? And, if ITA is as big a deal as Kayak says it is, then isn't Cutler spending more time with the vending machine than with his fellow board members?

It's time to make a choice, and I'm surprised Kayak didn't force the issue before filing its IPO. Of course, I'm also surprised that it didn't wait until the ITA/Google situation gets resolved…