Ellen Pao loses sex bias case against Kleiner

Elizabeth Weise | USA TODAY

Show Caption Hide Caption Ellen Pao bias trial's end marked by confusion The jury ruled against Ellen Pao on all claims in her sex discrimination suit against Kleiner Perkins after an initial tangle of confusion about the verdict. Elizabeth Weise, reporting from San Francisco Superior Court, explains what happened.

SAN FRANCISCO — A jury ruled against Ellen Pao on Friday in her sex discrimination case against venture capital firm Kleiner Perkins Caufield & Byers.

The jury found Kleiner Perkins did not discriminate against Pao on the basis of gender, did not keep her from a promotion because of her gender, took reasonable steps to prevent gender discrimination at the firm and did not retaliate against her for complaining about gender discrimination.

As the courtroom convened to hear the verdict around 2 p.m. local time today, Silicon Valley was literally on pins and needles in anticipation of who would win the closely watched case that highlighted a gender gap in the industry. Pao, after all, was taking on the venerable venture-capital firm behind Google, Amazon.com, Genentech and scores of others.

And it was Kleiner Perkins that won on all counts.

"Today's verdict reaffirms that Ellen Pao's claims have no legal merit. We are grateful to the jury for its careful examination of the facts," Kleiner Perkins said in a statement.

"There is no question gender diversity in the workplace is an important issue," the VC firm said. "KPCB remains committed to supporting women in venture capital and technology both inside our firm and within our industry."

As the jury forewoman read out the "no" of the first part of the verdict, Pao's lawyer, Therese Lawless, reached over and squeezed her shoulder. As the list of "no's" continued, there were a few muted gasps in the room.

Next came a hiccup on the question of whether or not Pao was retaliated against because she wrote a memo about what she believed was gender discrimination at the firm or because she eventually filed a lawsuit against the firm.

The jury forewoman initially told Judge Harold Kahn the jury had found Pao was not retaliated against for speaking up about discrimination at the firm.

Kahn then polled the jury to get each juror's vote on the record. When he did, the vote on the fourth claim of retaliation was eight for no, she was not retaliated against, and four for yes, she was. In civil court, a three-quarters vote, which would be at least nine for no, is required.

The judge told the jury members to return to their deliberations. About two hours later, the jury returned with a 9-3 verdict against Pao on the retaliation claim.

One juror changed his mind between the original decision being made in the jury room and walking into the courtroom, juror Steve Sammut said during a quickly-organized news conference afterwards.

To his mind, the most compelling support for Kleiner came when the jury looked at annual reviews for several partners that were introduced into the testimony.

The "areas to improve" tended to stay the same for Pao, he said. Other staffers, both male and female, who were later promoted to senior partner tended to have areas of poor performance drop off and new ones come up, he said.

Juror Marshalette Ramsey had the opposite reaction.To her, the performance reviews showed clear sexism.

The same kinds of personality traits might be cited in the reviews, but depending on how it was worded and whether the person was male or female, "it could either propel you to promotion or termination," she said.

However she was adamant that the jury was not divided between men and women. "I was the only woman" on Pao's side, she said.

She was not bitter about the outcome. "I think Ellen Pao has opened all our eyes," to problems of sexism in the workplace, she said.

PAO'S SUIT WAS CLOSELY WATCHED

Pao's suit asked for $16 million in lost wages and future earnings, as well as a possible $144 million in punitive damages.

Pao joined Kleiner in 2005 as chief of staff to John Doerr, a highly-regarded general partner at the firm. She began to transition into a role as junior investing partner beginning in 2010.

She was fired on Oct. 1, 2012. She says that was because she had complained about gender discrimination, though Kleiner said it was because she didn't have what it took to become a senior investment partner.

In her suit, Pao accused the powerful firm of not promoting her to senior partner because she was a woman and retaliating against her after she began talking with senior staff about what she said were problems with sex discrimination beginning in December 2011.

Kleiner's stance was that Pao was part of a general "up or out" system at the firm, where many junior partners worked at the firm over the years but few were promoted to senior partner.

Even though Pao lost, the trial was a win for women, said Joan Williams, an expert on gender law and professor at the University of California Hastings College of the Law in San Francisco.

"There's no turning back," she said. "This case will have an impact on how venture capital and tech in general run their organizations, regardless."

It's remarkable the case even came to public trial, said Noreen Farrell, executive director for Equal Rights Advocates, a non-profit women's rights organization based in San Francisco. Few women stand up to this kind of discrimination in the venture capital industry because of "this fear of retaliation and the wrath of these really rich companies," she said.

"This case has already blown the lid off what's happening at this intersection of tech and finance in a very public way," she said.

After the verdict was read, Pao thanked her family, friends and legal team for their support.

"I want to thank the people all over the world who reached out to me with their stories. My story is their story," she said.

"If I've helped to level the playing field for women and minorities in venture capital, then the battle was worth it. Now," she said, "it's time for me to get back to my career."