Monthly Archives: September 2015

Silicon Valley gender discrimination lawsuit: the ending

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About 6 months ago, Silicon Valley VC firm Kleiner Perkins won a jury verdict in former employee Ellen Pao’s high-profile gender discrimination jury trial. (See the Law Talk discussion of the verdict here.)

A few weeks later, an interesting (and expected) follow-up issue emerged: litigation costs. Pursuant to the “American Rule” that sometimes shifts a lawsuit winner’s costs to the loser, Kleiner asked Ms. Pao to reimburse its litigation costs in the amount of $973,000. But in an unusual twist, Kleiner offered to waive its right to recover litigation costs if Ms. Pao agreed not to appeal the trial court decision. Christina Lee, a spokeswoman for Kleiner, had the following explanation in a statement quoted in several newspapers and magazines at that time: “We believe that women in technology would be best served by having all parties focus on making progress on the issues of gender diversity outside of continued litigation.” Law Talk discussed these litigation cost issues here, and concluded with the anticipatory “to be continued.”

In June, Ms. Pao proceeded with an appeal.

And just last week, Ms. Pao announced that she was dropping her appeal, and without any settlement agreeement.  According to a statement that she released to the Wall Street Journal, Kleiner offered her a settlement agreement with financial benefits (presumably forgiveness of the debt concerning court costs), but only if she refrained from “disparaging” Kleiner.  She said in her statement: “Settlement might have provided me with financial benefits, but only at the great cost of silence. I feel gratified that my actions have encouraged others to speak up about discrimination in venture capital and technology more broadly. I am encouraged that companies are taking more action to quantify and address the disparity of opportunities for women and minorities.”

Despite her refusal to “sell” her ability to speak out, she nonetheless explained her decision to drop the appeal as being financial, saying that she could no longer afford to continue.  (An article in the Huffington Post provides more details.)

It’s still not clear how much of Kleiner’s costs Ms. Pao needs to pay.  She’s reportedly paying $276,000 (down from the $973,000 requested in April), but a Fortune article analyzes several aspects of uncertainty about the final amount that she’s paying, and concludes that “this is all over. Sort of. »

So we have an incomplete dénoument or coda, depending on your preferred art form metaphor.

To be continued? Maybe, and maybe not . . .

Uber lawsuit certified a class action

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Yesterday, United Stated federal district court judge Edward Chen certified, as a class action, the widely watched case of Uber Drivers v. Uber (really known as Douglas O’Connor v. Uber Technologies).  As Law Talk explained in February, a class action lawsuit involves one or several persons suing on behalf of a larger class of persons.  The rules of civil procedure allow this only when the issues in dispute are common to all members of the class, and the members of the class are so numerous as to make it impracticable to bring them all into court.  The decision in a class action lawsuit can bind all members of the class.

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In the Uber case, the plaintiff drivers claim that they’ve been misclassified by defendant Uber as independent contractors, when they should be properly considered employees entitled by law to reimbursement of expenses like gas and vehicle maintenance.   Two California administrative agencies have already ruled that Uber drivers are employees and not independent contractors (the California Labor Commission and the California Unemployment Insurance Appeals Board), but Uber continues to maintain that several factors point to the drivers being independent contractors and not employees.

You can read yesterday’s class certification decision here.  Judge Chen had previously denied Uber’s motion for summary judgment, which you can read here. (Summary judgment is appropriate when a decision is possible without a trial, because no relevant facts are in dispute and the decision turns on pure legal analysis.)

Of course, Uber is considered the strongest of the “unicorns,” privately held firms with a market capitalization of over a billion dollars.  Reports such as this one in the Wall Street Journal cite a market cap for Uber of 50 billion dollars–yes, FIFTY billion–just 2 months ago.  Needless to say, Uber can afford an outstanding legal team!

To be continued . . .