Investigator in Silicon Valley sex bias case gives inside view of Kleiner Perkins

March 7, 2015, 1:57 AM UTC
Ellen Pao, Therese Lawless
Ellen Pao, center, leaves the Civic Center Courthouse along with her attorney, Therese Lawless, left, during a lunch break in her trial Tuesday, Feb. 24, 2015, in San Francisco. A jury heard opening arguments Tuesday in a multi-million dollar sexual harassment lawsuit filed by the current interim chief of the news and social media site Reddit against a prominent Silicon Valley venture capital firm. Pau is seeking $16 milion in her suit against Kleiner Perkins Caulfield and Byers, alleging she was sexually harassed by male officials. (AP Photo/Eric Risberg)
Photograph by Eric Risberg — AP

A female venture capitalist suing prestigious venture capital firm Kleiner Perkins for sex discrimination told an investigator she was pressured into a “non-consensual” and “unwelcome” sexual relationship by a colleague.

But Ellen Pao, who has sued the firm for allegedly retaliating against her after complaining about the relationship and the old boys club behavior by fellow partners, couldn’t provide more than two examples of inappropriate behavior, said Stephen Hirschfeld, the investigator hired by Kleiner Perkins to check out her story.

His testimony in San Francisco Superior Court Friday comes after he concluded in his investigation that Pao’s accusations were groundless. He established that her relationship with Nazre was consensual, despite what she claimed, and that she suffered no retaliation.

Still, an unflattering portrait of Kleiner Perkins emerges from interviews he conducted with the women who worked there. One, Trae Vassallo, a partner, had calculated the investment profits generated by men and women at the firm and found that women had better results. But the investigator never reported that finding back to Kleiner Perkins management.

“I felt that it wasn’t important,” Hirschfeld told Pao’s attorney. “I felt that there was sufficient information in my report already.”

Pao, who was fired from her job at Kleiner Perkins and is currently interim CEO at online bulletin board Reddit, claims that was unable to get a promotion after ending her relationship with co-worker Ajit Nazre. Meanwhile three male junior partners who had been at the company for a shorter time were promoted. Kleiner Perkins argues that Pao, whose performance reviews are peppered with words like “territorial” wasn’t a team player and did not have the skills to succeed in venture capital.

Hirschfeld’s testimony has been damaging for Kleiner Perkins as well as Pao. He often fills in details that managing partners say they can’t recall, including confirming that legendary investor John Doerr told him that Pao had a “female chip” on her shoulder. Doerr said that Pao tended to blame others for failed relationships.

Hirschfeld’s testimony and interviews with Pao depict her as someone who is brilliant, but prickly, while contradicting some of her allegations. He could find no evidence about an alleged trip during which partners visited strip clubs and could not get Pao to offer any detail beyond a complaint about partners discussing porn stars.

Hirschfeld also said Pao couldn’t explain how her relationship with Nazre had started. She said that they had sex four or five times and it had been “terrible.” When interviewed, Nazre told Hirschfeld that he had promised Pao that he would leave his wife. But he didn’t and the fighting escalated.

One dispute came after Pao and Nazre spent the weekend at a Ritz Carleton in a seaside town near San Francisco. Shortly after, Nazre returned to spend another weekend there with his wife and kids. When Pao found out, she went crazy, Nazre told the investigator. Hirschfeld also said that he found Nazre’s credibility dubious.

At the same time, Hirschfeld painted a picture of Kleiner Perkins as a firm that women working there found “tough” and not nurturing. One woman explained the way to cope was to deal with it or leave. Another told him it was hard to get a word in edgewise and that she couldn’t get the “time of day” and was “cut down” by managing partners.

Vassallo, who had also complained about sexual advances by Nazre, said “males have a lot more bravado” and “don’t hesitate to sell themselves to the partnership.” Hirschfeld’s investigation substantiated Vassallo’s complaint about Nazre, who was ultimately fired.

When he interviewed employees, Hirschfeld repeatedly heard about the importance of being mentored by a managing partner. Yet most managing partners were male and tended to mentor other males they identified with. No one was very clear on what it took to get promoted at Kleiner—the crux of the matter being argued at court.

“Both males and females were unclear about the path to promotion at Kleiner Perkins,” Hirschfeld testified.

Next week, Pao is expected to take the stand.


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