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tv   With All Due Respect  Bloomberg  March 27, 2015 5:00pm-5:31pm EDT

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>> this is a special edition of bloomberg news regarding the ellen pao case in san francisco. cory johnson is standing outside of the san francisco jury court as we await a jury finding in the sexual discrimination suit against kleiner perkins. i am pimm fox along with alix steel. we understand that they work through lunch time in order to present a verdict and that they will be doing so shortly. the verdict could go either way. potential claims of about 100
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$50 million against kleiner perkins. this is a landmark case, most likely to be appealed which way the verdict goes and highlights not only the working conditions at kleiner perkins but also combines a quality that many people may even described as being a soap opera. the interconnectedness of the venture capital world and of the finance world. alix: we are looking at for accounts that we want to hear a verdict on. first of all is the overall this nation. -- we're looking for four counts that we will hear the verdict on. second, the rays that she should have had or promotion the cut she was a woman. the fourth one is that the firm did not protect her against discrimination. those counts are what we are looking for. as you mentioned, $60 million
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that she is claiming in lost wages. this has really captivated not only silicon valley but in general because it opens up a whole host of bees if you will about how women are perceived in the workforce, in particular in the venture capital world. about 20% of kleiner perkins partners are women. women in the d.c. landscape had been declining. the question is why. pimm: for all viewers that are looking for "with all due respect," that can be streaming online and will be on at 8 p.m.. corey -- cory is standing outside the courthouse. with the men that did not testify, apparently he and ellen pao had a consensual sexual
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relationship while she was working at kleiner perkins. he never testified. is there anything to indicate what the jury was specifically looking at when it looked at the behavior of the various people? she worked at the company five months after she found the lawsuit. cory: so, the middle to competency. the retaliation charges. she was saying that two of the reasons that she was doing, she was retaliated against as she was retaliating against the sexual arrest meant. only after she made the complaint. the reason it is important is because there is a lot of testimony in the trial that came
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up that china perkins, she had a mixed record that kleiner perkins that brought up that she only complained after she was passed up. the policies did not work, they were not rewritten until after she had found her complaints. the notion is that kleiner perkins is scrambling to cover their butts. one of the reasons that they look so bad is that you have a senior partner that had a sexual affair even though he was married. he lied about whether or not he was separated. pimm: john doerr arranged for
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her to go to the aspen institute. she hooked up with his friend, buddy fletcher. perhaps in the popular press known as the individual at the dakota apartments in new york who sued because they were not allowed to have another department. cory: the also had a hedge fund that spectacularly burned down. all of that information was kept away from the jury. that was kept at this trial. the history of her husband as well as the history of other lawsuits that they had fouled over time.
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she was his chief of staff before she was a partner at the firm. she was the one that worked most closely with him. quite often, on the phone, she would be the person that would respond. she is someone who really knew how it he worked rather closely. alix: in your experience researching this and being in silicon valley, who has more to lose in this? is it ellen pao or kleiner perkins or is the damage either way already done? cory: it is going to be incredibly hard for a woman who is been sexually harassed in any way small or large or real or perceived to come out and make that an issue. it will have to be a horrible thing and i cannot imagine what that means for them professionally as well as
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personally. in terms of who has more to lose financially, that is perfectly evident who has the most dollar amount. china perkins would be out at least $100 million and it could hurt the reputation. pimm: we actually got a headline, we did get a headline out of the trial. the decision not to promote pao wasn't gender-based. also we are getting more news out here, the firing wasn't based on gender. that is what the jury was saying. reading what we are hearing from this verdict. what is your reaction, that the decision wasn't gender-based? cory: two of the complaints are that she did not advance further because of the complaint. what that suggests even if they
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find against kleiner for some of the facts in the case. if they think that she was not going to advance in the firm, the hundreds of millions of dollars of future earnings would be significantly lessened. that is one of the issues that they would face. alix: kleiner perkins failure to promote pao wasn't a retaliation. a lack of emotion wasn't gender-based and it was not a retaliation. -- the lack of promotion wasn't gender-based. cory: we will hear that claim of promotion and advancement. we are going to hear the same thing about the money, whether or not she was given a raise. they would find the same on both counts.
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pimm: i want to bring in bill from can. he has been following this case. u.s. spoken to us yesterday and said that this would be an uphill battle. based on what you have heard, the two of the counts so far about retaliation having to do with potential promotion. >> that is a bad sign for her. if you are discriminated against, you have to prove that you are discriminated against. if you are retaliated against you have to have the basis that you are cheating. pimm: we want to bring you the headlines. alix: kleiner perkins fights off partner alix: ellen pao's claims.
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kleiner perkins is able to fight off ellen pao's gender bias claim. pimm: there are four counts, for issues. none of them have to do with sexual harassment. they have to do with promotion and retaliation because of relationships that might or might not exist inside of kleiner perkins with ellen pao. bill from can, a little bit more from you, the idea that this is going to be more difficult for ellen pao to prevail. bill: you don't have to be correct in terms of your allegations, you just have to have the bases to make them. it is actually two went on retaliation. -- it is actually easier on retaliation. this does not bode well that she was correctly making the
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complaints. it doesn't sound to me that she is going to do particularly well. what cory said is correct. if the failure to promote her was not due to her retaliated against then she will not be getting any lost earnings as a result. that is significantly effective. if you look down to the road to preventive damages, you cannot get to them unless you are successful in the underlying claims. those signs are basically negative and i would not be surprised if it is the way. alix: let's recap the headlines kleiner perkins is successfully fighting off ellen pao's gender bias claims. the failure to promote ellen pao was not due to retaliation. once you have heard these decisions from the jury, what don't we know yet, what is still
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outstanding? bill: they can show that she was discriminated against. she is ultimately meeting that she was in sexual harassment. the jury is not buying into this whole concept. as i've said before, i will not be surprised that this is a total loss for her. pimm: there were several junior partners that were promoted at the time that she found out that she was not to be promoted. she fouled a lawsuit and worked for geithner perkins for an additional five months. she noted her firing on a
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website even though she continued to head up various middies at kleiner perkins. -- she final the lawsuit and worked for kleiner perkins for an additional five months. bill: it is a smart play by the employer. if you foul a lawsuit and shortly after she was terminated or they make her life miserable by taking her off committees hurting her in the pocketbook etc., it would be obvious. once an employee complains, they become radioactive. you really cannot touch them even if you want to. how long after you complained were you hurt the cause the longer you go after the complaint, the less likely the complaint is. it is the abcs of defense for unemployed lawyer to tell their
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client, she was protected activity. that is not going to be good. it is to basically hand is off. her performance evaluation suffered, etc. etc. that led to them pulling the trigger later. it is not unusual -- pimm: hang on because we want to bring in the attorney janeen yancey who joins us by the telephone. she's an expert in such cases. what can you tell a space on the headlines you know about the case. >> given that the jury returned a defense verdict, it is clear, as i said just the other day, you have the same facts and the defendants are giving you one version and the other, they clearly felt like the defendants
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story was the more credible story. alix: what kind of appeals can we expect in a case like this? >> you will get an appeal from the plaintiff. alix: what is the process for that? what might an appeal be when we are looking at kleiner perkins fighting off a gender discrimination bias? >> the process is a lengthy one. they will start to look at the whole record, the trial record and identify issues that are appealable issues. you're looking at a couple of years at least to see the appeal through. pimm: cory johnson, i know that you are standing outside of san francisco superior court. cory: outside of the courtroom
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is upstairs. we are outside of the building. the photographers have run up to try to get reaction. one of the things that kleiner perkins attorney brought up at the beginning of the trial was that kleiner perkins absolutely has the right to fire the person just because they don't like her and don't like having her around. she tried to set the bar very low. just being unlikable is fair enough i must they can prove dissemination was the cause. -- unless they can prove discrimination was the charge. people don't have a right to a job as long as they are not discriminated against. pimm: mary meeker testified as one of them. what were the councils looking for to learn what, about how women are excepted are not accepted in silicon valley culture?
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cory: they had a woman who was once one of the most junior analysts of morgan stanley and scorned with abusive from all of the traders back in the 80's and early 90's when she recommended crummy tech stocks. she knows how bad wall street can treat women. when she goes to a place like kleiner perkins, she had a very different experience and she was able to say when she sat in the superior court, she was able to say that working at kleiner perkins is one of the best jobs in the industry. and having worked right on wall street, she can see what the worst in the industry is in terms of treatment for women. having that perspective from a kleiner perkins senior partner who is able to say that at least one of the trips that ellen pao was excluded from, actually, i was invited to that trip.
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i didn't want to go. it countered the narrative that women were saluted and men were not. alix: the video you're watching is ellen pao entering the courthouse earlier today. she was awaiting the verdict. i want to bring in brad stone also joining us from san francisco. as you go over the headlines that continue to come out, where in the trial do you think you help clean this decision, what was the missing link? brad: they failed on the law. a had to show that gender was a substantial motivating factor in her failure to be promoted. kleiner attorneys did a very good job showing there were other factors at work. cory mentioned pao's on
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likability from colleagues. they showed her investment record was questioned by partners. there were some really unpleasant facts for ellen and her team. the fact that she had entered into a can sexual -- a consensual sexual relationship with a partner. they fail to prove that gender was a substantial motivating factor. she a compass one of her goals, she brought a lot of attention to the lack of diversity in silicon valley in general and venture capital in particular. -- she accomplished one of her goals. brad: what can you tell us about her track record? she went to princeton. she is a harvard grad who got her mba. brad: right now, she is ceo of reddit. one of the most popular websites
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in the country. she has had an operating role that is temporary. she can have it longer. she is seeing as a hero by a lot of people for going it alone, for doing that the solitary walk from the parking garage to the courthouse for five weeks. even though this jury of 12 found that her claims did not meet the standard for gender dissemination, she did reveal something about bias in silicon valley. maybe, in some weird way, that she does not get the financial damages, she might have helped her profile and her career. alix: what kind of appeal process do you foresee and how long might that end up taking? brad: i am not a lawyer. to be contrary, maybe she won't appeal this.
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maybe she is accomplished some of her goals to bring attention to the case. she lost on the merits. maybe she declares victory and goes home. i think it was much more likely as kleiner lost that they would have appealed and some of the other circumstances about her financial status should have been allowed by the judge. maybe she saves time and money and doesn't do it. i don't know. of course, she could appeal it. i have a feeling that a lot of the players are happy to put it behind them right now. pimm: you have spoken with there is people in silicon valley in executive positions about this case. they have even you the thoughts perhaps without naming names. can you talk about the lawsuit and what ellen pao alleged? brad: you would be surprised how
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much sympathy and support that has been. i think people identify the fact that she found herself a woman in a man's world, the fact that she alleges that there was this forms of subconscious bias that she had to deal with, not being invited to parties, being asked to sit on the periphery of meetings. whether or not you believe that she should have won her case people identified with this. the numbers of diversity in silicon valley are really bad. a lot of sympathy and some fear. that companies of the venture capital firms are going to be held accountable for their gender diversity workforce, the way they treat women and minorities. overall, a lot of interest and some sympathy and identification with alan. alix: not just in silicon valley, here as well. there is -- it is ethical to
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prove motivation, especially when it comes to sexual discrimination. >> yes, although i have to point out that the kleiner defense team did an amazing job. they have some bad fax to work with and typically with those bad fax walking into a san francisco jury is a really tough spot to be end. i think that kleiner perkins should be thanking their defense counsel, their team. pimm: it turns out that the bad facts continue because the jury has been sent back to continue their deliberation on one of the four counts. i beg your pardon, go ahead. >> can you update me on which count they're going back? pimm: we don't know the specifics on which count but go ahead, continue with your thoughts about what this would mean for any future sort of
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employment law or any kind of corporate human relations guidelines that companies would have to set in place. >> more than anything else, what this shows, kleiner perkins could have saved themselves millions of dollars just on their legal fees. they are probably into it for-five million dollars on the defensive fees as well as three years of a headache. have they had a little bit more guidance in 2010, 2011 when they determined that she was not somebody that they wanted to have in their boat with them, they could have acted in a way so that they would have avoided probably this whole lawsuit. alix: this is coming from -- the judge saying that 8-4 is not a sufficient majority on claim four the retaliation claim.
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can you tell us a little bit more about this claim that they are struggling to find a verdict on? cory johnson, are you there? the judge is saying that 8-4 is not a sufficient majority on claim four, the retaliation by determination -- by termination lane. can you give us a background of what this was. cory: this is about what the firm did to her. she worked for the company for five months afterwards. she knows how these things work. what she did over that time, that was a big issue. she was gathering evidence of everything that happened to her indeed before she fouled the
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suit, collecting e-mails, e-mailing with a friend that worked at another tech company on how to best gather that information and document the worst of the behaviors at kleiner perkins said that she could use it in a suit if indeed in a trial. the jury was not unanimous in their decision about this and the judge is pressing them to agree with each other. it is not over until it is over. alix: i know you are not a lawyer but talking about a majority of 8-4, i am wondering what the goal is. what kind of deliberations do they need to see in order to feel ok about that verdict? cory: it is not clear to me if they have announced all four counts, that they have announced what they've done in those matters.
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there might be a lot more deciding to do. it will affect the calculations of the damages and whether or not the jury believes that she can continue to work there later. when growth happen so fast, the notion of what a long-term career might look like when you are partnered and the value is calculated is nearly impossible. the jury would be tasked for that. they conclude that she would not have worked there regardless. pimm: her relationship with buddy fletcher, that does not mean that it is not part of the ongoing coverage of the case.
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they were profiled in "vanity fair," magazine as well as "the new yorker" how does that sit with silicon valley? cory: "fortune" magazine did a great story about this. all of the documents are not out yet. at the end of her testimony, mary meeker had a question for the judge, wanting to know when all of the documents will be released. it will interesting to see the minutia of the documents that were part of the discovery and the evidence, when the court's record is finally published, that we will be able to see everything about what the partners had to say, about conversations they had that the company they were invested in, people they hired, didn't hire and what they thought of certain partners. imagine you are thinking about investing and kleiner and you
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are working with one of the partners that they might have dumped on. their business could be significantly affected in the aftermath of this trial. alix: what is the biggest question that you have now? >> might biggest question is how they will respond to this fourth claim. alix: what did you make of that fact that the judge had to send them back to deliberate again? >> just that the jury was not following what they needed to do so they needed to convince one more person to turn back a no verdict on that. alix: thanks so much. we have cory johnson outside of the courthouse and breast on was joining us in san francisco. we have a lot to cover. -- we have cory johnson outside
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of the courthouse and brad stone joining us in san francisco. we have a lot to cover. stay with us, a lot more to come on the kleiner perkins trial. pimm: this is a bloomberg news special. pimm: this is a special report on the gender discrimination suit. the jury has found for he willen p.o.w. -- for kleiner perkins against ellen pao. kleiner perkins fending off a gender discrimination suit filed by ellen pao. a former employee. of kleiner perkins. oik you mentioned we're waiting -- ake you mentioned we're -- alix: you mentioned we're waiting for the claim. that really deals with the fact that she continued to -- ellen pao continued to


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