Ellen Pao refuses settlement but drops discrimination lawsuit vs. Silicon Valley firm

Ellen Pao

AN ASIAN/AMERICAN woman's historic lawsuit that exposed Silicon Valley's dark underbelly is over.

In a statement released yesterday (Sept. 10) to Re/Code, Ellen Pao said she would not pursue an appeal against her former employer, the storied venture capital firm of Kleiner Perkins Caufield & Byers. Her suit claimed gender discrimination and retaliation from her bosses.

Pao lost the case in a jury trial in San Francisco earlier this year and was weighing her next steps.

“I think I brought these important issues to the forefront of the conversation, but the online aggression has had a toll on me and my family,” she said. “That so many people heard what I had to say, against all that was brought to bear against me, is a testament to the depth of the problem related to women and tech … [But] I have gone as far as I can go and cannot commit the resources and time that would be needed to continue.”

Pao's full statement.

As part of the end of the lawsuit, Pao said she would pay Kleiner Perkins close to $276,000 in legal fees, which carried a 10 percent annual interest. But Kleiner had previously said it would waive those fees if she dropped the appeal, so it is not clear if Pao will be on the hook for those costs that included witness fees.

Pao did not settle with Kleiner Perkins because she didn’t want to be prevented from speaking about the case, she said. "Settlement might have provided me with financial benefits, but only at the great cost of silence," Pao said. "I refuse to be silent on these important issues."

That means she’s still liable for $276,000 in legal fees, though Kleiner previously said the firm would waive the fees if Pao dropped her appeal.

Still, Pao underscored that the court system in California is stacked against her and others who claim discrimination against their employers. In California, plaintiffs must prove intent, a very difficult process, especially if the discriminatory processes are institutionalized as the way of doing business. 

RELATED: Three Asian/American women challenge Silicon Valley bias

“I think it is wrong that employees have to pay in this situation, but I simply cannot afford the risks of more costs to fight a firm with massive PR and legal resources,” she said. “The court system is not set up to create an even playing field.”

Kleiner has asserted since it won the trial earlier this year that Pao had no grounds for appeal, which Pao did not agree with. In a statement, she said: “To be clear, Kleiner and I have not reached any agreement to settle this matter. Settlement might have provided me with financial benefits, but only at the great cost of silence.”

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Kleiner Perkins issued this statement: “We are glad to put this trial behind us. There is no question diversity in the workplace is an important issue. KPCB remains committed to supporting women and minorities in venture capital and technology both inside our firm and within our industry.”

The high tech industry's problem with diversity has been a hot topic in boardrooms since they released their workforce numbers a few years ago. What the records of their hiring practices showed was an overall lack of Latinos and African/Americans and the small number of high-level Asian/American executives and managers even though Asian/Americans make up a large portion of their workforce. 

"I have a request for all companies: Please don’t try to silence employees who raise discrimination and harassment concerns," Pao wrote in her op-ed. "Instead allow balanced and complete perspectives to come out publicly so we can all learn and improve. I and many others are eager to hear more stories being shared by women and minorities. I turned down offers to settle so I can keep telling mine. We need to keep telling our stories and educating people on how it can be that women and minorities form such a small fraction of our investor base, our tech workforce and our leadership."

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