The Unprecedented Demise of Harvey Weinstein (Part 2)

This is the second in a series of blog posts on my reflections as an employment attorney on the unprecedented demise of Harvey Weinstein. Feel free to read my first blog post “Now is the Time to Revisit Anita Hill’s Historic Testimony Following Harvey Weinstein’s Unprecedented Demise.”

What Failed in the Aftermath of Professor Anita Hill’s Historic Testimony in 1991, And What is Causing Sexually-Abusive Predators to Escape Prosecution?

During my last year of law school, in 1993, I had the honor of meeting Professor Anita Hill when she came to speak at my law school, Washington University School of Law. This was when we learned of the ongoing assault on Professor Hill’s character, attempts to derail her career, and even threats on her life that followed. Soon after meeting Professor Hill, I was offered my first job as an associate attorney in a boutique law firm. Not only was I the first female associate hired by the law firm, it was located in Las Vegas, Nevada, and exclusively represented companies, high-level executives and management employees in labor and employment-related matters. As a die-hard feminist and Anita Hill supporter, how could I represent accused harassers and their companies at all, let alone, in sin city? While the job market for lawyers in 1993 was bleak, and I, too, needed a job to pay the bills, I raised these concerns with my boss, who ultimately became my mentor throughout my career. Thankfully, my boss and male colleagues walked the walk anytime – and there were many – male clients attempted to cross the line with me and anytime the evidence strongly substantiated sexual harassment claims against our clients. #metoo.

Top Five Reasons this Litany of Sexually-Abusive Predators have Escaped Prosecution and Punishment:

After I met my husband and moved to Los Angeles, California in 1995, I not only continued to represent employers and management in the workplace at a large and small law firm, and in-house, at a multi-million dollar company, but sexual harassment claims became my forte so I have witnessed first-hand what has failed in the aftermath of Professor Hill’s testimony. Here are my top five:

Frivolous Claims and Minimal Recovery on Meritorious Claims:

Although the number of sexual harassment claims increased initially after Professor Hill’s testimony, the sobering truth is that 80-90% of the sexual harassment/abuse claims that my colleagues and I have handled in the last twenty-six years, are patently frivolous. Either the allegations themselves were not sexual in nature at all, the alleged conduct was provably false, or the complainant initiated, welcomed and/or actively participated in the offensive conduct s/he complained about. Of the 10-20% of meritorious claims, a large percentage of the victims’ recovery is often minimal, because their damages are either insignificant, and/or they had to endure costly, protracted, emotionally-debilitating litigation. In any lawsuit, even if the accused has violated the law, the complainant must always prove damages. Unlike a car accident, if there is no physical injury, emotional distress damages are more difficult to quantify, such that if the employee does not seek psychological treatment related to the alleged unlawful conduct, or does seek treatment, but other personal issues unrelated to the alleged conduct contributed to the emotional distress, a minimal recovery will often result.

Attorneys typically represent employee complainants on a contingency basis which means the attorneys recover a percentage of the employee’s total gross recovery. In California, if the employee complainant is the prevailing party on a sexual harassment, discrimination and/or retaliation claim, the employment laws award the attorneys (not the complainant) their reasonable attorneys’ fees so the timing and settlement amount are driven by these attorneys’ fees. While most employment-related claims ultimately settle before trial, after the costs and attorneys’ cut are subtracted from the gross settlement, the victim’s recovery after years of prolonged litigation is often insignificant.

The good news is that digital evidence has leveled the playing field because all it takes is one e-mail, text or other electronically-stored communication to expose unlawful conduct. The audio recording released by the New Yorker of the chilling exchange between Mr. Weinstein and a young model in which he aggressively pressured her to come to his hotel and admitted to groping her in a previous encounter, was the nail in Mr. Weinstein’s coffin. It is important to point out that the model was wired by New York police, such that the taping was lawful. If the model had secretly taped Mr. Weinstein on her smartphone, for example, it is likely that she violated California Penal Code §632, which prohibits taping confidential communications, without first seeking permission of the other party. Not only is violation of Penal Code §632 punishable by fine and/or imprisonment for a first offense, the recordings would not be admissible in a civil lawsuit in California.

Substantiated claims of sexual harassment and abuse should be quickly resolved by counsel, but often times the bullying behavior of the accused is carried out by the attorneys retained by the accused and the Company further victimizing the complainant,sending a strong message to the entire workforce who are afraid to testify truthfully, let alone, complain of any unlawful conduct that they, too, have experienced.

Training, When Provided, is Ineffective:

While the state of California mandates certain training on various laws, most affected Companies elect inexpensive generic on-line training courses that the participants treat like on-line traffic school — doing whatever it takes to game the computer to print out a certificate of completion. As it stands now, California law only requires employers with 50 or more employees to provide two hours of unlawful harassment training to supervisors and provide ongoing prevention training every two years. In 2016, as a compromise to the plaintiff’s employment bar, the California legislature added bullying to the list of subjects to train supervisors, even though bullying is still not against the law. Therefore, Mr. Weinstein’s documented non-sexual bullying of The Weinstein Company employees is not a violation of employment laws. Although The Fair Employment and Housing Commission passed several amendments to the Fair Employment and Housing Act (FEHA) in April 2016 expanding employers’ training obligations, they continue to fall short by still allowing webinars and on-line courses. The latest amendment, SB 396, only added gender identity, gender expression and sexual orientation to the subjects that require training and displaying a poster on transgender rights prominently in the workplace, but nothing more will be required for 2018.

Complaints are Not Promptly and Thoroughly Investigated by a Trained Independent Investigator Resulting in Appropriate Remedial Action:

California employers are required to promptly conduct a thorough, independent investigation of all claims of harassment, discrimination and retaliation raised by applicants, employees and even third parties in the workplace. If the conduct is more likely than not to have occurred, the Company must take appropriate remedial action to stop it, and ensure that the complainant, and any persons participating in the investigation, are subject to any form of retaliation. This is where Companies continually fall short.

Here, Mr. Weinstein was not terminated because of his unlawful conduct, or following a prompt, thorough investigation of the allegations. Mr. Weinstein was terminated in a nanosecond because of the legal exposure to The Weinstein Company when his known unlawful conduct was exposed. If, as the media has reported, Mr. Weinstein’s contract permitted him to simply repay The Weinstein Company for any payouts by the Company for his behavior, then obviously they were not only aware of his unlawful behavior, but repayment was all that was required of him to continue his employment. This alone directly violates the Weinstein Company’s legal obligation to prevent discrimination, harassment and retaliation.

The Company and/or the Accused Rarely, if Ever, Pay the Price for Unlawful Conduct:

California employers are strictly liable for unlawful discriminatory, harassing or retaliatory conduct by its supervisors. In other words, it does not matter if the employer knew or should have known of the alleged unlawful conduct. If the supervisor engaged in unlawful conduct, the employer is automatically liable for this conduct. While both the Company and the supervisor are named as parties in employment-related lawsuits, the vast majority of these cases are resolved by settlement, with the employer (and/or insurer) — not the accused — paying the settlement/judgment and costs of defense.

In California, the employer has a duty to defend and indemnify its employees as to acts engaged in during the course and scope of their employment. When the accused denies he or she engaged in the allegations, the employer is required to assume the costs of defense, unless proven otherwise. Since harassment, discrimination and retaliation are acts outside the course and scope of employment, the employer is legally entitled to recoup the costs from the accused, but rarely does this ever occur in practice.

Mr. Weinstein’s net worth is reportedly estimated between $240 million and $300 million and The Weinstein Company estimated value is close to a billion dollars. If, as the media reports, the settlements were in the range of $80,000 and $150,000 (ridiculously low recoveries for sexual assault), the settlement amounts are the equivalent of the rest of us putting a quarter in the swear jar, so neither the Company or the accused pay the price of any unlawful actions.

Binding Arbitration and Confidentiality Agreements Conceal Any Unlawful Conduct:

While social media is buzzing with the lack of reporting and fear of retaliation, which are important driving forces here, not enough attention has been spent on the processes and agreements that conceal unlawful conduct.

Applicants, employees and others who engage in business relationships with companies are typically required to sign agreements that contain binding arbitration provisions. So long as the signed arbitration agreement requires that all disputes by either party will be resolved by binding arbitration, the employer agrees to pays the costs of arbitration with its employees, and both parties waive their rights to jury trial, the arbitration provision is likely to be enforced by a Court. Who do you think benefits from waiving jury trial and confining all the dirty laundry in a private confidential setting before an arbitrator? Settlement agreements always contain confidentiality provisions contractually prohibiting the victim, from sharing anything regarding the alleged unlawful conduct, other than, stating at most, that the matter has been resolved, and if violated, will result in additional legal action against the complainant, including, return of the settlement amount.

In my next blog post, I will address what must be done in the aftermath of Harvey Weinstein’s demise.

For more information on sexual harassment in the workplace, feel free to contact Lisa Sherman at (424) 249 -3631 or email her at Lisa@sherm-law.com.

The Unprecedented Demise of Harvey Weinstein (Part 4)?

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The Unprecedented Demise of Harvey Weinstein (Part 2)

What Failed in the Aftermath of Professor Anita Hill’s Historic Testimony in 1991, And What is Causing Sexually-Abusive Predators to Escape Prosecution?

Top Five Reasons this Litany of Sexually-Abusive Predators have Escaped Prosecution and Punishment:

For more information on sexual harassment in the workplace, feel free to contact Lisa Sherman at (424) 249 -3631 or email her at Lisa@sherm-law.com.

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