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We’ve entered the thrilling now-we-wait portion of the Ellen Pao gender discrimination trial. A few questions keep coming up.
Though we’ve extensively watched both “Scandal” and “Ally McBeal” and spent the better part of 24 days going through metal detectors to enter the San Francisco Civic Center courthouse, neither of us technically has a law degree. (Objection! Liz denies watching these shows, but Nellie overrules that as impossible.)
So we’ve asked real lawyers a lot of questions about this case, and here’s what we can report back in response to some of the repeat questions we’re getting about the trial on Twitter, in email and from our own brains.
Who is expected to win?
While the arc of the broader media narrative has been focusing on the allegations against Kleiner Perkins Caufield & Byers and the details Pao has dredged up (billionaires, office affairs, the Playboy mansion, Al Gore), this case has no slam dunk or smoking gun.
Pao is tying together a number of different issues — double standards in performance reviews, a male-dominated history at Kleiner Perkins, incidents where women were excluded or treated differently and upset about it — and an absence of human resources people, policies and training at a very well-established company. She definitely scored some hits.
Meanwhile, Kleiner Perkins partners didn’t always present themselves well on the stand, but they also brought context that helped fill out these incidents in ways that seemed less discriminatory.
Interestingly, John Doerr is the crux here, for both sides. He was clearly Pao’s mentor and helped guide and support her through the organization for many years. He offered to fire the guy Pao had an affair with, Ajit Nazre, because Nazre lied to her — and Pao fought for Nazre to stay. Those are big points for Kleiner Perkins.
But Doerr is also the guy who wrote in an email to his partners during 2011, the crucial year before Pao was fired: “I’m concerned with inequities in our partnership inconsistent among our practices with regard to ‘up and out.’” (He’s talking about how Kleiner Perkins handles promotions and departures for people who don’t get promoted to the highest level.)
Doerr continued, “I don’t know how a junior partner could have a better year than Ellen did, measuring results, profits, increase in value — except for her clash with Randy [Komisar over a portfolio company called RPX they both worked on]. And honestly I think they both behaved badly.” That’s one of the strongest articulations of her case.
Pao’s side is at its best when it ties into the larger narrative of winning for all women, and her lawyer Therese Lawless went out with a bang yesterday.
What does Ellen Pao have to prove?
Pao is suing on four counts, two of discrimination and two of retaliation: 1) Kleiner Perkins discriminated against Pao based on gender, 2) Kleiner Perkins retaliated against her after she complained, 3) Kleiner Perkins failed to take all reasonable steps to prevent that discrimination (she can only win this one if she’s already won No. 1), and 4) Kleiner Perkins retaliated by firing her.
Her strongest and easiest argument, many lawyers tell us, is No. 4: She complained about discrimination and filed a lawsuit, and then was fired. Companies really aren’t supposed to fire people who have already sued them.
But for Pao to win that retaliation claim wouldn’t be a larger statement about gender — just about how Kleiner Perkins botched a particular personnel complaint.
What does this mean for other similar cases?
Even without Pao winning her case, a couple of very similar lawsuits have cropped up just in the past week. A former Facebook product manager sued the company for discrimination, harassment and retaliation based on her gender, using one of the same law firms as Pao, Lawless & Lawless. And a former Twitter software engineer filed a gender discrimination lawsuit over Twitter’s promotion process. Many in the technology industry have noted that both lawsuits were filed by women who are Asian-American, just like Pao.
Is there a legal precedent for this case? Could it set a legal precedent?
Yes, the most relevant Supreme Court case is Price Waterhouse v. Hopkins from 1989, about whether a partnership could withhold promotion from a woman, Ann Hopkins, whose personality didn’t fit in but who was a high performer. It established how courts should balance motivations and evaluate evidence in these kind of cases. Hopkins won.
As for how important this case is, it would have to make it to an appeals court to set any kind of precedent, but perhaps the two issues that stick out, lawyers have told us, are 1) notions about implicit bias and coded language and what that means and how to prove it, and 2) the wonky topic of how to consider carried interest — that is, how Kleiner Perkins shares profits with partners over the 10-year life of its funds. Judge Harold Kahn has said he can’t find any relevant precedents on carried interest.
Does the jury have to be unanimous?
No, the standard in a California civil case is three quarters of the jury, or nine of 12.
Will both sides appeal?
Kleiner Perkins clearly wants to protect its image or it wouldn’t have put itself through this trial, so we’d expect its default would be to appeal. Pao seems happy to have provoked a larger public discussion with her trial, so we would think she’d want to see it through. But the reality is, we don’t know and they probably don’t know until we all see how the jury decides.
Who decides the damages?
The jury decides with the judge’s final approval, but it doesn’t have the full information yet. Some testimony about damages was withheld at the trial until the verdict establishes whether it’s necessary. If the trial keeps going, there will be a more detailed discussion of two forms of stock-based compensation: Kleiner Perkins’ carried interest (which is complicated, as described above) and Reddit stock options (which the company where Pao is now interim CEO very much wants to keep private).
If the jury finds that damages are deserved, we’ll come back for a “phase two” of the trial of a day or two, and hear about those.
How are damages calculated?
Like many people, we’ve been using the estimate from pretrial discussions that Pao is suing for something like $16 million in damages, much of this from lost wages if she had stayed at Kleiner Perkins and been promoted. The precise number hasn’t been brought up in court yet.
Judge Kahn had considered stripping out punitive damages from the trial, because they have a higher standard of proof that he doubted Pao’s side had met, but he ended up leaving them in.
The rule of thumb for punitive damages is that they are up to nine times the regular damages, so in this case, $144 million. Combined with the $16 million in damages, that would give Pao a maximum payout of $160 million.
However, the judge has leeway to reduce the punitive damages when he interprets the verdict into the judgment of the court.
Who pays whose legal fees?
If Pao wins, Kleiner Perkins pays her legal fees. We’re told that holds whether or not she has a mixed or a complete victory. If Kleiner Perkins wins, Pao will be expected to pay the firm’s expert witness costs, but not its legal team’s fees. That would still add up to hundreds of thousands of dollars.
This article originally appeared on Recode.net.
