Ellen Pao avoids public airing of family finances

Elizabeth Weise | USA TODAY

SAN FRANCISCO — The judge in Ellen Pao's $16 million gender discrimination lawsuit against venture capital firm Kleiner Perkins has ruled that her financial situation isn't relevant to the case and that bringing it into court would "create an unseemly sideshow."

Kleiner's lawyer, Lynne Hermle, had tried to get Judge Harold Kahn to overturn his pretrial ruling and allow Pao's financial difficulties to be discussed in court.

That would presumably have included the financial troubles of Pao's husband, Alphonse "Buddy" Fletcher Jr.

A hedge fund run by Fletcher has filed for bankruptcy, and he has been accused of fraud. According to Kleiner's brief, tax liens on the sale of the couple's condominium in San Francisco have been served on Pao's Kleiner partnership interests.

However, Kahn quashed the idea in a ruling posted to the San Francisco Superior Court website Thursday.

Kahn said that Pao's motivations weren't relevant and that any relevance was outweighed by "the substantial danger of undue prejudice to Ms. Pao and confusion of issues, as well as undue consumption of time."

In addition, Kahn said that the information about Pao and her husband's financial situation was "protected by Ms. Pao's and Mr. Fletcher's rights of privacy."

He cited a Tennessee ruling that found that anyone who "stands to gain financially has a motive to sue, whether or not they are in financial distress."

That takes one potentially explosive issue off the table: whether Pao is suing the venture capital firm for gender discrimination to make a point — or to raise cash.

On the stand, Pao has said she wants $16 million from the Silicon Valley firm because it would take an eight-figure number to "hit their radar" and cause the firm to make changes in how women are treated.

Kleiner tried to make the argument before trial started that she's doing it because her family needs the money.

If money's the motive, she could have sued for more, suggested one human resources expert.

"She's only asking for $16 million. That's nothing," said Janine Yancey, CEO of Emtrain.com, a human resources and compliance training site.

Last year, federal jurors in San Diego awarded Rosario Juarez almost $186 million because AutoZone told her a pregnant woman couldn't handle the job of store manager and fired her.

"And that was for a single plaintiff," Yancey said.

That flight, Pao's exit voicemail

Pao spent most of Thursday on the stand, being questioned first by Hermle and then by her own attorney, Therese Lawless.

Hermle spent the time trying to dismantle the story Pao's lawyers have sought to tell. It is one of a bright, hard-driving employee foiled in her upward trajectory by a working culture that didn't value women and allowed them to be harassed and retaliated against when they complained.

Lawless then took her time to buttress that view of Pao's seven years at the firm.

One example was a much-discussed private plane trip to a business meeting in New York, during which Pao has said she was subjected to inappropriate discussion of porn stars, older men dating younger women, meetings at the Playboy Mansion and the "hotness" of a Silicon Valley luminary.

On the stand, Hermle pushed Pao to admit that the sexual portion of the discussion only lasted about ten minutes.

Later in the day, when Lawless was again questioning Pao, she came back to the six-hour plane flight.

Weren't there other portions of that flight that you deemed inappropriate, she asked?

"Yes," said Pao. "Another ten or 20 minutes."

Another example was the outgoing message Pao put on her Kleiner voice mail the day she was fired in 2012.

Hermle played this portion of it in court: "This is Ellen Pao. I have been terminated from employment at Kleiner Perkins Caufield & Byers."

Intimating that this was very unprofessional, Hermle said, "you knew this would likely be disruptive to any business callers you called you."

When Lawless came back to Pao, she asked for "the whole" message to be played.

It was then the jury heard that Pao went on to give another Kleiner staffer's email address for callers looking to do business with the firm and as well as her home email for those trying to reach her personally.

Qualified?

At the heart of all these discussions is the question of qualifications. What the case finally comes down to is whether Pao was qualified to be a senior partner at the firm, said James Ryan, a partner at Cullen and Dykman in Garden City, NY.

Pao says she was kept from the position because she was a woman.

That's going to be difficult to prove in the rarified world of venture capital. It's one thing to show that someone wasn't promoted in a position where the requirements for promotion are clear, said Ryan.

In a case like that, the plaintiff only has to show that they met the criteria, applied for the job and wasn't given it because they belonged to a class of people protected by anti-discrimination laws.

It's much harder at a place like Kleiner because there the criteria are highly subjective--and that subjectivity is perfectly legal, said Ryan, who practices employment law.

At one firm, a very shy, laid-back type of person might be perfect to be a senior partner, but at another firm that same person might be completely unqualified because of the aggressive culture of the company, said Ryan.

For Pao to win, her lawyers are going to have to convince the jury that she was qualified--and her qualifications were overlooked because of her gender.