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Ellen Pao Loses Gender Discrimination Lawsuit Against Silicon Valley VC Firm Kleiner Perkins

Reddit CEO Ellen Pao leaves a San Francisco courtroom on February 24, 2015. (KGO screen grab)

Reddit CEO Ellen Pao leaves a San Francisco courtroom on February 24, 2015. (KGO screen grab)

A prominent Silicon Valley venture capital firm triumphed on Friday over a former junior partner who sued claiming she was discriminated against because of her gender.

The San Jose Mercury News reports a San Francisco jury of six men and six women sided with Kleiner Perkins Caufield & Byers over Ellen Pao in the most high-profile Silicon Valley gender discrimination case to date.

Pao’s suit, which sought $16 million in damages, accused Kleiner of passing her over for promotion because of her gender, retaliating against her when she complained about her treatment, and firing her in 2012 for her complaints. It also charged the company with failing to prevent gender discrimination.

The jury reached its verdict on its third day of deliberation, finding that Kleiner did not discriminate against Pao when company executives did not promote her and then terminated her employment after a tumultuous seven-year career. The jurors decided that Pao’s gender had not been a significant factor in the firm’s actions.

Shortly after the verdict was read, however, the presiding judge sent the jurors back to deliberate on one of Pao’s claims, which had resulted in an 8-4 vote in Kleiner’s favor. Nine votes are required for a decision to be valid.

In mostly siding with Kleiner, the jury validated the firm’s argument, put forth by Kleiner attorney Lynne Hermle, that Pao’s failure to gain promotion was due to the fact she was difficult to work with and lacked the skills to succeed as an investor, despite receiving a mentorship and ample opportunity to improve. Hermle also argued Pao did not seem interested in following advice that could have helped her improve at her job.

“She did not come close,” Hermle asserted, adding that Pao “lacked the ability to lead others, build consensus and be a team player, which is crucial to a successful career as a venture capital senior investing partner.”

While Kleiner may have prevailed over Pao, many observers claim the prestigious firm is a loser despite the verdict because the trial shined a light on the rampant sexism pervasive in the heavily male-dominated venture capital and technology industries. According to research conducted by Babson College, only six percent of venture capitalists are women, down from 10 percent in 1999. This dearth of women inevitably leads to discrimination, critics claim.

Silicon Valley is rife with systemic discrimination and rampant sexism. Lately there are nearly constant accusations and revelations of tech industry men behaving badly—sometimes incredibly so—toward women, often with impunity. After a series of shockingly sexist emails from Snapchat CEO Evan Spiegel emerged last year, he still had no trouble securing $10 billion in new funding. Among the new investors was Kleiner Perkins Caufield & Byers.

In addition to the low number of female venture capitalists, the number of women studying computer sciences is also pitifully small, and in many cases only two to four percent of engineers at tech companies are female. Many women feel intimidated by the “brogrammer” culture at too many tech firms. Julie Ann Horvath, formerly an engineer at GitHub, quit in disgust last year.

“My only regret is not leaving or being fired sooner,” Horvath tweeted after her departure. “What I endured as an employee of GitHub was unacceptable and went unnoticed by most.”

“I had a really hard time getting used to the culture, the aggressive communication on pull requests and how little the men I worked with respected and valued my opinion,” she told TechCrunch. Horvath says she was once left “shaking in horror” after a company founder’s wife intimidated her at her work station after she complained about the firm’s deeply entrenched sexism.

Kate Losse, an early Facebook employee and author of The Boy Kings: A Journey Into the Heart of the Social Network, told the Los Angeles Times that despite the overall progress of women in recent decades, much remains as it was during bygone days when sexism and misogyny barely and rarely raised eyebrows or ire.

“At a time when the technology industry is becoming increasingly important, I think it’s important to focus on what hasn’t changed and what is still very traditional about this world, what isn’t so revolutionary and so progressive,” said Losse.

Valley-watchers now have eyes on the cases of Tina Huang and Chia Hong, respectively former employees of Twitter and Facebook, who have filed gender discrimination, and in the case of Hong, sexual harassment and racial discrimination, lawsuits against the social media giants.

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