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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Ellen Pao steps down from Reddit, are the trolls winning?

Ellen Pao leaves Reddit

REDDIT calls itself, "the front page of the Internet." For Ellen Pao, it was a rabbit hole into a world that got curiouser and curiouser. 

"The Internet started as a bastion for free expression. It encouraged broad engagement and a diversity of ideas," Pao wrote in the Washington Post. "Over time, however, that openness has enabled the harassment of people for their views, experiences, appearances or demographic backgrounds. Balancing free expression with privacy and the protection of participants has always been a challenge for open-content platforms on the Internet. But that balancing act is getting harder. The trolls are winning."

It has not been a good year for Pao, who earlier lost a sexism lawsuit vs. a former employer, venture capitalist firm Kleiner Perkins Caufield & Byers; and then, three weeks ago, she lost her job as Interim CEO of Reddit.

Since her departure - she resigned, not fired - the Reddit universe has been in turmoil. Some say she was set up to fail.

The freedom given to Reddit's unpaid moderators to monitor the communities, or "subreddits," also gave rise to racist and sexist sites under the guise of freedom of speech. The hate and venom on these sites are the main reason Reddit has had difficulty win advertisers, an Internet platform's lifeblood.

Pao was tasked to rid the platform of those subreddits. Along the way, she released a popular employee, Victoria Taylor. Even though one other bosses asked to her fire Taylor, the redditors blamed her. The backlash came back a hundred fold.

Pam's critics claimed censorship. In protest, some of the moderators shut down their sites. An online petition circulated and reportedly collected 200,000 signatures calling for Pao's firing.

However, there may be something more behind all that hate and venom hurled at Pao that shows the dark side of the Internet.

Pao, a lawyer and businesswoman who has a resume centered in Silicon Valley, inspired much controversy and vitriol from numerous Reddit users when she decided first to ban several popular subreddits dedicated to racist, sexist, and fat-shaming posts; and then to fire popular employee Victoria Taylor, administrator for the site's popular "Ask Me Anything" (AMA) subreddit where celebrities and other notable personalities field questions from users.

Pao was hired eight months ago to replace previous CEO Yishan Wong, who stepped down amidst another bout of controversy surrounding, among other things, his public conflict with a former employee. 

In her own post on Reddit, Pao reaffirmed the sentiment behind both her closing of the aforementioned subreddits and her reaction to vitriol on the site following both unpopular decisions:

"I just want to remind everyone that I am just another human; I have a family, and I have feelings. Everyone attacked on reddit is just another person like you and me. When people make something up to attack me or someone else, it spreads, and we eventually will see it. And we will feel bad, not just about what was said. Also because it undercuts the authenticity of reddit and shakes our faith in humanity."

Pao will be replaced by site co-founder Steve Huffman.

Last week, Reddit's chief engineer, Bethane Blount, announced her resignation after just two months on the job.

Although she claims her departure is not related to Pao's resignation, Blount also said she believed Pao’s exit was an indirect consequence of gender discrimination, and that Pao had been placed on a “glass cliff.” It is a term used to describe women being set up for failure by being put in leadership roles during crises. According to Re/code: 

“Victoria wasn’t on a glass cliff. But it’s hard for me to see it any other way than Ellen was,” Blount said. However, she added that “I wouldn’t say my decision to leave was directly related to my gender.”

Being named "Interim" CEO weakened her authority and made her an easy target for long-time Reddit regulars.

Reddit co-founder Steve Huffman, who is replacing Pao, added that he thought some of the messaging around Pao had gotten extremely ugly. “I don’t think Ellen has been in a position to defend herself,” he said. “It’s okay for redditors to be angry, but I thought some users crossed the line when it became personal.”

Board head Sam Altman described the vile — and some have described as misogynistic — criticisms of Pao in his memo to the site.
“It was sickening to see some of the things redditors wrote about Ellen. The reduction in compassion that happens when we’re all behind computer screens is not good for the world. People are still people even if there is Internet between you,” he wrote. 

We can't ignore that 75 percent of Reddit users are males who have claimed the Internet as their playground and they don't want some outsider - especially a woman - interjecting herself in their exclusive game.

Seen from afar, Reddit is not about creating a virtual community, its about the giving an individual a sense of power, whether they deserve it or not, and whether the redditor uses it for good or evil is not considered. That internal struggle to define Reddit is what claimed Pao as collateral damage.

Pao isn't the first woman to be bullied by the Internet. Writer Jessica Valenti of the Guardian writes if she could start over, she might prefer to be completely anonymous on the Internet. “I don’t know that I would do it under my real name,” she tells young women who are interested in writing about feminism. It’s “not just the physical safety concerns but the emotional ramifications” of constant, round-the-clock abuse.

“If the Reddit community cannot learn to balance authenticity and compassion, it may be a great website but it will never be a truly great community,” wrote Altman.

But, there's a silver lining in this dark story. As the Reddit story played out into its third week, the tide began to turn. Huffman swore that he would continue to purge Reddit of its hate-filled content.

So let's let Ellen Pao have the last word:

"So it’s left to all of us to figure it out, to call out abuse when we see it. As the trolls on Reddit grew louder and more harassing in recent weeks, another group of users became more vocal. First a few sent positive messages," said Pao in an oped in the Washington Post published over the weekend. "Then a few more. Soon, I was receiving hundreds of messages a day, and at one point thousands. These messages were thoughtful, well-written and heartfelt, in stark contrast to the trolling messages, which were usually made up of little more than four-letter words."

The battle continues. And ... the body count keeps rising.

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3 Asian women challenge culture of Silicon Valley

Ellen Pao entering the courtroom in San Francisco.

THE IMAGE of a bustling Silicon Valley that prizes drive, entrepreneurship and innovation as harbingers of our future economy is being challenged by ... three ... Asian ... women. 

Since March is Women's History Month, it is fitting that we bring your attention to these three women who are turning the high-tech industry inside out with their allegations of gender discrimination.

The mythic Horatio Alger-story of a bunch of guys tinkering in their garage then becoming billionaires also carries with it the negative image of a closed society of rich, socially inept, immature ol' boys club where women are viewed as trophies and routinely passed over for promotion because they don't fit into that mold. 

Facebook, Twitter and the influential venture capital company, Kleiner Perkins Caulfield & Byers, are facing lawsuits for gender discrimination.

Ellen Pao may have lost her lawsuit against the influential venture capital firm of Kleiner Perkins Caulfield & Byers today, March 27 but she inspired others to file their lawsuits against their former employers. Tina Huang, former Twitter employee, and Chia Hong, formerly of Facebook, filed their suits within a week of each other as the world awaited the outcome of jury deliberations in Pao's lawsuit.

All of their former employers deny the charges. Their cases sheds light on the dark side of the high tech industry that has long been criticized for its lack of diversity.

Based on statistics gathered from the companies themselves, white males make up about 70 percent of the high tech workforce. I am assuming that that percentage is even greater in the upper echelon levels.

The arguments in Ellen Pao's case vs. Kleiner Perkins Caulfied & Byers concluded March 25 and we're holding our breath awaiting the decision the jury of six men and six women.

During the trial, the inner workings of one of the best known venture capital firms was exposed and their behavior - even if Pao's allegations are exaggerated or misinterpreted - doesn't paint a pretty picture: men's only meetings and outings, asking high-level women executives to act as secretaries during meetings, innuendos and the assumptions that the women are there for window dressing.

Kleiner Perkins lawyers' strategy of attempting to blame the victim is similar to the way some defense lawyers attack allegations of rape; blame the victim, question their qualifications, paint her as a disgruntled rejected woman.

Pao's attorney's closing statement said she was as qualified if not more so, than her male peers who received promotions. 

It is a reflection of our society that an aggressive woman is seen as "presumptuous" while an aggressive man is praised as "having balls."

A New York Times article wrote that Pao was told, “she didn’t speak up enough and was too passive — but also that she spoke up too much and was pushy and entitled.” 

According to Fortune magazine, only 4% of senior venture capitalists are women. So, I guess one can argue that the Pao's experience is not reflective of the venture capitalists  because there are not enough women in high-level positions. Uh ... isn't that part of the problem, guys? Many firms don't even have women in management positions.

The suits vs. Twitter and Facebook, address the hardware and software segments of the industry where the stats also seem to indicate that the industry of the future, which prides itself on innovation and being ahead of the curve, was following the same model of other older businesses - read, "good-ol'-(white)-boys" club.

The San Francisco Chronicle wrote in an editorial: "Ellen Pao's loss is anything but a win for Silicon Valley's status quo. The challenges she raised about the male-dominated culture that controls the heart of the innovation economy can't be dismissed."

Silicon Valley cannot - must not - go back to the way it was before the trial. The culture that fed upon itself by stealing each others employees and hiring people who had an affinity for T-shirts and hoodies knows it's time is past and it needs to diversify in order to keep its business viable and relevant. In other words, its good for business to diversify its workforce. 

Because of the lawsuits by the three Asian women, the hiring practices of tech firms are in the glare of the spotlight. 

As the news of Pao's trial verdict spread throughout the restaurants, bars and coffee shops of the valley, almost lost in the hubbub were the stories below; 

RELATED: 
Asians hit a bamboo ceiling in Silicon Valley
Google hires woman CFO and made her the highest paid woman in the tech world.
eBay puts two more women on its board of directors

Diversification starts at the top. Let's hope that message trickles all the way down throughout the companies' office culture.

By the way, once and for all: can we dump that tired old stereotype of Asian women being demure, obedient, submissive, walk-3-paces-behind-the-man, sex slaves? Shift-alt-delete!

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