Win or lose, discrimination suit is having an effect on Silicon Valley

Ellen Pao, left, leaves court with her attorney Therese Lawless during a lunch break from her trial. She is suing her former employer, Silicon Valley venture capital firm Kleiner Perkins Caufield & Byers.

March 25, 2015 5:05 PM PT

reporting from san francisco — She was a junior partner at one of Silicon Valley’s most powerful venture capital firms. But was Ellen Pao a greedy underperformer? Or was she a victim of a sexist corporate culture?

That’s the choice confronting a jury in a trial that has riveted an industry struggling to attract and keep talented women in the workforce.

Ellen Pao vs. Kleiner Perkins Caufield & Byers wrapped up Wednesday after weeks of testimony exposed salacious details of workplace trysts, all-male outings, porn talk and alleged routine harassment. Jurors must decide whether the firm discriminated against Pao, 45, because she is a woman, and then fired her in retaliation after she sued in 2012.

“Even before there’s a verdict in this case, and regardless of what the verdict is, people in Silicon Valley are now talking,” said Kelly Dermody, managing partner at Lieff Cabraser Heimann & Bernstein, who chairs the San Francisco law firm’s employment practice group.

“People are second-guessing and questioning whether there are exclusionary practices [and] everyday subtle acts of exclusion that collectively limit women’s ability to succeed or even to compete for the best opportunities. And that’s an incredibly positive impact.”

Women in tech have long complained about an uneven playing field — lower pay for equal work, being passed over for promotions and a hostile “brogrammer” culture — and have waited for a catalyst to finally overhaul the status quo.

This trial — pitting a disgruntled, multimillionaire former junior partner against a powerful Menlo Park, Calif., venture capital firm — was far from the open-and-shut case that many women had hoped for. And Pao, portrayed as an uncooperative and conflict-ridden worker “with sharp elbows,” makes a less-than-ideal test case for gender bias in Silicon Valley.

“She’s not the most likable person in the world, but the kinds of evidence she’s alleged does track some of these long-documented patterns of both subtle stereotyping and blatant boys club activity,” said Joan C. Williams, a professor at UC Hastings College of the Law.

More gender discrimination suits against big tech firms are expected to follow; some already have, including lawsuits against Facebook Inc. and Twitter Inc.

The monthlong trial in San Francisco County Superior Court uncovered the inner workings of the highly successful venture capital firm, which has invested in companies including Google Inc., Snapchat Inc., Twitter, Spotify and Uber. It also revealed sordid tidbits about alleged behind-the-scenes antics.

Pao claimed that after inquiring about why women weren’t invited to a dinner with Al Gore, she was told that they “kill the buzz.” She testified that she had received a book that contained sexual poetry from a married male partner and had been subjected to colleagues’ discussion of pornography on a private plane.

Another female former partner testified that a male colleague had touched her with his leg under a table and appeared at her hotel room one night in a bathrobe and slippers.

The jury is now deliberating over four claims: that Kleiner Perkins willfully discriminated against Pao because of gender; that it retaliated against her by failing to promote her when she spoke up; that it failed to take reasonable steps to prevent gender discrimination against her; and that it retaliated by terminating her employment.

Pao is seeking $16 million in lost wages and bonuses, and punitive damages that could raise her total award to as much as $160 million. The jury will decide how much, if any, compensatory damages to award. If punitive damages are awarded, that amount will “be an issue decided later,” according to Judge Harold Kahn’s jury instructions.

In closing arguments, Pao’s attorney Alan Exelrod alleged that Kleiner Perkins cultivated a misogynistic culture that fast-tracked men at the expense of more-deserving women.

“Men were judged by one standard and women by another,” Exelrod said to the jury. “The leaders of Kleiner Perkins are the ones responsible for this double standard.”

When it was her turn, Lynne Hermle, Kleiner Perkins’ attorney, slammed Pao as greedy and unqualified. Pao is now interim chief executive of Reddit Inc.

“Neither her gender nor any complaints was the driver in any of the events at issue here. Like so many other misplaced accusations … these claims are simply a continuation of Ellen Pao’s attempts to blame others for her own failings,” Hermle said. “The complaints of Ellen Pao were made for only one purpose: a huge payout for Team Ellen.”

That strategy — to attack Pao’s character and to make her experience at the firm a one-off situation of her own making — could hurt her claim that a history of widespread discrimination existed at the firm, said Amy Oppenheimer, a workplace investigator who works with clients in Silicon Valley.

“Whether it’s correct or not, the defense has been able to focus on her shortcomings,” Oppenheimer said. “So it’s been much more about this individual than about the pattern of bias.”

Pao’s legal team has accused Kleiner Perkins of leading a smear campaign to discredit Pao and distract jurors. During closing arguments, attorney Therese Lawless sought to dispel criticism of her personality Wednesday.

“For the men, it didn’t hurt them getting promoted. But it hurt her,” Lawless said.

The case has spurred heated debate within Silicon Valley among male and female tech workers.

“Whether she wins or loses, the impact of the case has already been felt,” said Wayne Sutton, a tech entrepreneur and general partner at San Francisco accelerator BuildUp. “People know the problems are bigger than this.”

For some women, tales of alleged harassment at Kleiner Perkins reminded them of their own struggles in the tech world.

Divya Manian, a product manager at a Silicon Valley software firm, said she empathized with Pao.

“Ellen Pao’s conflict around the way her co-workers treated her — that’s something we’ve heard many times before,” the 31-year-old said. “It’s something I’ve experienced at conferences and it was something I didn’t speak up about.”

Manian noted that a lot of positive changes have been taking place in the valley as women have become more outspoken about unequal treatment: Diversity is “taking center stage” in recruitment conversations and more women have been hired as a result, she said.

So win or lose, many expect Pao’s trial will force further change.

“It’s going to open the floodgates for women who have gone through worse,” Manian said.

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