SAN FRANCISCO – A long legal battle over accusations that a prominent Silicon Valley venture capital firm demeaned women and held them to a different standard than their male colleagues became a flashpoint in the ongoing discussion about gender inequity at elite technology and venture capital firms.
Though Ellen Pao lost her lawsuit against Kleiner Perkins Caufield & Byers, Silicon Valley observers say her case and the attention it received will embolden women in the industry and continue to spur firms to examine their practices and cultures for gender bias.
“This case has been a real wake up call for the technology industry in general and the venture capital community in particular,” said Deborah Rhode, a law professor at Stanford University who teaches gender equity law.
The jury of six men and six women rejected all of Pao’s claims against Kleiner Perkins on Friday, determining the firm did not discriminate against her because she is a woman and did not retaliate against her by failing to promote her and firing her after she filed a sex discrimination complaint.
In making their case during the five-week trial, Pao’s attorneys presented a long list of alleged indignities to which their client was subjected: an all-male dinner at the home of Vice-President Al Gore; a book of erotic poetry from a partner; being asked to take notes like a secretary at a meeting; being cut out of emails and meetings by a male colleague with whom she broke off an affair; and talk about pornography aboard a private plane.
But the heart of their argument was that Pao was an accomplished junior partner who was passed over for a promotion and fired because the firm used different standards to judge men and women.
Kleiner Perkins’ attorney, Lynne Hermle, countered that Pao failed as an investor at the company and sued to get a big payout as she was being shown the door. They used emails and testimony from the firm’s partners to dispute Pao’s claims and paint her as a chronic complainer who twisted facts and circumstances in her lawsuit and had a history of conflicts with colleagues that contributed to the decision to let her go.
Rhode and other experts say Kleiner Perkins and the venture capital industry in general did not come out looking good even though they won the case.
“Venture capital firms recognize it’s not appropriate to be out in the streets celebrating,” said Freada Kapor Klein, founder of the Level Playing Field Institute, a non-profit that aims to boost minority representation in science, technology, engineering and math fields. “They don’t have the moral high ground.”
Even before the Pao trial started, a succession of employment statistics released during the past 10 months brought the technology industry’s lack of diversity into sharper focus.
Women hold just 15 per cent to 20 per cent of the technology jobs at Google, Apple, Facebook and Yahoo, according to company disclosures. The data were mortifying for an industry that has positioned itself as a meritocracy where intelligence and ingenuity are supposed to be more important than appearances or connections.
The venture capital industry is even more male-dominated, with a study released last year by Babson College in Massachusetts finding that women filled just 6 per cent of partner-level positions at 139 venture capital firms in 2013, down from 10 per cent in 1999.
Klein said before the verdict she was contacted by more than a dozen venture capital and technology companies asking how they could improve the environment as a result of the Pao case. She expects some firms will be “smug” after the verdict and do little to change for fear of being dragged through the mud while others will step up.
The attention surrounding the case makes it more likely other women who believe they have been discriminated against will go to court, said David Lewis, CEO of OperationsInc., a human resources consulting and contracting firm. Two women who formerly worked at Facebook and Twitter filed gender discrimination cases against the companies during the Pao trial. One of Pao’s attorneys, Therese Lawless, is representing the plaintiff in the Facebook lawsuit.
At the very least, Pao’s suit will prompt more women to open up about their experiences in the workplace, said Nicole Sanchez, founder of Vaya Consulting, which tries to help Silicon Valley companies increase diversity.
“I do see a trend now in the name of Ellen Pao,” Sanchez said, pointing to the Twitter hashtag, “ThankYouEllenPao” that popped up as the verdict came in. “Women in technology are telling their stories.”
Associated Press writers Michael Liedtke and Olga Rodriguez contributed to this report.