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Ellen Pao arrives at San Francisco Superior Court in San Francisco
Ellen Pao at San Francisco Superior Court on March 3, 2015. Photograph by Robert Galbraith — Reuters

Ellen Pao’s finances will not be considered in Kleiner Perkins sexism trial

Mar 12, 2015

Venture capital firm Kleiner Perkins had hoped to portray Ellen Pao, the former employee suing it for $16 million for alleged sexism, as hoping to cash in with the case as way to solve her family's financial problems. But a judge ruled against that idea Thursday, saying it would "create an unseemly sideshow."

The decision by San Francisco Superior Court Judge Harold Kahn means that the jury will not hear about Pao's financial state, or perhaps more importantly, that of her husband, Alphonse "Buddy" Fletcher Jr., an investor who is under investigation by federal authorities after overseeing a hedge fund that went bankrupt.

Lynne Hermle, an attorney representing Kleiner Perkins, had hoped the judge would reverse a pre-trial ruling to bar the evidence. By prohibiting it, the judge has eliminated one potential point of vulnerability for Pao, who has insisted that she sued only to publicly expose the firm's discrimination..

Judge Kahn read over written arguments yesterday from both sides in the case about whether to allow discussion of Pao financial state. After weighing the issue, he ultimately decided that it was irrelevant to the case.

In 2012, Pao filed a lawsuit against Kleiner Perkins where she worked for seven years, alleging the firm refused to promote her because of her gender and retaliated against her for complaining about its sexist culture. Kleiner has denied the accusations and argued that Pao's personality was unsuited to being a venture capitalist.

Pao married Fletcher in late 2007, four months after meeting through a fellowship program at the Aspen Institute. Fletcher ran a hedge fund in New York City, and was once on Forbes' list of the richest African-Americans.

However, in 2011, Fletcher sued his apartment building, the famed Dakota in New York City, for turning down his application to buy a fourth apartment, for $5.7 million. He claimed he was rejected because he was black. Fletcher's lawsuit over the apartment ultimately led to the bankruptcy of one of Fletcher's funds and investigations by the Justice Department and the Securities and Exchange Commission.

Since taking the stand Monday, Pao has tried to paint her former employer as a boys club that repeatedly ignored complaints of harassment and hostility. She also revealed earlier this week that at one point she asked Kleiner for an exit package of at least $10 million.

“I wanted Kleiner Perkins to have some type of accountability for their lack of action in all of these different events when they should have taken action and did nothing,” Pao said on the stand today, echoing her previous statements. Kleiner refused to pay.

Hermle has probed Pao about her compensation at Kleiner and at Reddit, the online bulletin board where she is now interim CEO, in an effort to show that's she's taken a severe pay cut.

Pao concluded the first leg of her testimony this afternoon, and will resume after former Kleiner COO Eric Keller finishes on the witness stand.

During Keller's testimony, Hermle's questions painted Pao as unwilling to cooperate with the firm's efforts to investigate and resolve her complaints about sexism. He also talked about Pao's angling for an exit package as being financially-motivated, and a calculated move on her part.

"The damages to me and my reputation have been very, very significant," Keller recalled Pao saying. Confused about what she meant, he asked Pao to be more specific, which she did by detailing the big payout she hoped to get.

"Eight figures," she said.

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