Lawyers Pull Out Stops in Pao Trial Closing Arguments

Attorneys on Wednesday advanced their closing arguments in the US$16 million gender discrimination suit brought by Ellen Pao against her former employer, Silicon Valley venture capital firm Kleiner Perkins Caufield & Byers.

Final arguments in the trial, which has been ongoing in the Superior Court in San Francisco for about a month, began Tuesday with Pao’s attorney, Alan Exelrod, laying out his client’s case to a jury of six men and six women.

Exelrod argued that Pao was fired from KPCB in 2012 after she submitted a memo to management about bias at the firm and filed a gender discrimination lawsuit against it.

While Pao’s advancement in the firm was hampered by her gender, her salary wasn’t, Exelrod acknowledged. Her $400,000 salary was greater than that of some of her male peers.

However one KPCB partner, Ted Schlein, wrote a fraudulent performance review on Pao in 2011, he said, arguing that Schlein wanted Pao removed from the firm because she was a woman.

‘Twisting Facts’

If the jury believes either fraud or malice were involved in Pao’s termination, they can — thanks to a decision by the trial judge over the weekend — impose punitive damages on KPCB, which could amount to $100 million or more.

Following Exelrod’s remarks, Lynne Hermle, KPCB’s attorney, presented the venture firm’s side of the case. She argued that neither gender nor retaliation had anything to do with Pao’s dimissal from KPCB.

Pao has been “twisting facts” in anticipation of filing a discrimination lawsuit since 2011, when she failed to receive a promotion she thought she deserved, Hermle said.

Pao’s complaints to management about discrimination never were intended to help other women at the firm but were meant to set the groundwork for a big payday for Pao through future litigation, she alleged.

Showing photos to the jury of women at KPCB, Hermle noted that there may be gender discrimination in the venture industry as a whole, but there is none at Kleiner Perkins, where strong women continue to succeed.

Hermle is expected to complete her closing Wednesday, followed by a rebuttal by Pao attorney Therese Lawless.

Odds Favor Pao

“I think the case is going quite well for her,” Tom Spiggle, an employment attorney with The Spiggle Law Firm, said of Pao.

“She’s been a credible witness, has told a powerful story, and has had some good expert testimony on her behalf,” he told the E-Commerce Times.

“It’s far from a slam dunk, because the defense has this narrative that she was treated just like every other employee, and it was part of her personality that she could not be satisfied. Defendants have had success with those kinds of arguments in the past,” Spiggle pointed out.

“A jury is always a bit of a crapshoot,” he added. “It’s always a bit a black box.”

An indication of just how strong Pao’s case may be can be found in Judge Harold Kahn’s decision to allow the jury to consider punitive damages during its deliberations.

“It bodes well for Pao that that was left before the jury,” Spiggle said. “If it were a weak case, the judge would have taken that issue off the table.”

Of all Pao’s allegations, retaliation is her strong suit, he noted. “A plaintiff can actually lose an underlying discrimination case and still win retaliation. All you have to do is show they complained about wrongful conduct — either rightfully or wrongfully — and something bad happened to them.”

Wake-up Call

Win or lose, Pao’s lawsuit could have repercussions throughout the technology industry.

“I think it’s a real wake-up call to the VC industry in particular and the tech community in general,” said Stanford Law School Professor Deborah L. Rhode.

The “evidence presented in the Pao case is emblematic of typical patterns in Silicon Valley,” she told the E-Commerce Times.

Whether that connection between Pao’s treatment at a venture firm and the tech industry as a whole will be made in the aftermath of her trial, however, remains to be seen.

“The venture capital world is a small world within Silicon Valley culture,” said Charles King, principal analyst at Pund-IT.

“It’s likely that the gender discrimination cases pending against Twitter and Facebook are potentially more damaging, because they would affect a larger of number of people,” he told the E-Commerce Times.

Earlier this month, Chia Hong filed a lawsuit against Facebook, charging that discrimination, harassment and retaliation led to her firing. Tina Huang filed one against Twitter claiming gender discrimination in the company’s promotion process.

John Mello is a freelance technology writer and contributor to Chief Security Officer magazine. You can connect with him on Google+.

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