Silicon Alley And Sexual Harassment
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By Renee Kaplan | 01/17/00 | The New York Observer
David Jaroslawicz is an aspiring scourge of the internet. As the lawyer who is leading a new charge against the city’s expanding Net businesses, he has identified a niche, one that is likely to be discovered by other lawyers very soon: Silicon Alley sexual harassment.
Right now, Silicon Alley is particularly vulnerable. Its denizens tend to work in an informal, nonhierarchical environment. It is a boys’ club, flush with new wealth and the sense of entitlement that goes along with it. By and large, there is no mature human-resources combine, which in big companies can help educate employees and inoculate their bosses (or vice versa).
“You have these young executives who are thrown into these big-shot positions and they have no management skills,” said one Silicon Alley veteran. “They are learning by making just horrendous errors.”
Enter Mr. Jaroslawicz, a frail, diminutive 52-year-old contingency lawyer and partner at Jaroslawicz & Jaros. He has suddenly become something of an evangelist on the subject of the dot-com workplace and the abuses that go on there.
“They got a whole new crop coming every year, straight out of college, from all over the world, wanting to get into the Internet business, wanting to do it in New York,” he said. “You complain, and they fire you, because they know they can replace you-fungible females.”
Mr. Jaroslawicz is representing the plaintiffs in three recent multimillion-dollar sexual harassment lawsuits against two prominent Manhattan Internet companies, Juno Online Services Inc. and Pseudo Programs Inc. Lisa Bongiorno and Lori Park, former employees of Juno, have each filed a $10 Million sexual harassment and discrimination suit against the Internet service provider, which has a market capitalization of $1.58 Billion.
On Jan. 5, Kelly Alfieri filed a $3 Million suit against her former employer, Pseudo, an internet TV network, alleging harassment, a hostile work environment and sexual discrimination. Pseudo’s founder and chairman, Josh Harris, was also the founder of Jupiter Communications (his Jupiter holdings are presently worth $30 Million), and he has made headlines more recently for his attempt at creating a multiday millennial happening in two warehouse buildings in TriBeCa.
“Pseudo or psycho,” Mr. Jaroslawicz snorted. He was sitting in his office in a gray fake-leather chair. “Sometimes they can’t tell the difference between reality and virtual reality. You know, they had a receptionist at that place and her main job was to dress in provocative clothing and go-go dance for clients and potential clients, in the office and at parties.”
Mr. Jaroslawicz has been practicing law in New York for 28 years. Three years ago, he served as counsel to Shannon Marketic, a former Miss USA, in her famous attempt to sue the Sultan of Brunei for allegedly holding her captive and forcing her into prostitution. The lawyer was unfortunately foiled by the Sultan’s immunity as a head of state. Incidentally, had Mr. Jaroslawicz won the suit against the Sultan, then reputedly the richest man in the world, he and the beauty queen stood to reap a potential $90 Million in damages. He also represented Milanese Fashion Cafe owner Giorgio Santambrogio in a countersuit against models Elle Macpherson and Christy Turlington. He sued Penthouse magazine on behalf of two guys who claimed to own the rights to nude photos of former Miss America Vanessa Williams. There have also been plenty of securities class action suits and some libel suits.
Mr. Jaroslawicz is a contingency man, a jack-of-all-litigation who said he has no interest in specializing at all. “I try not to limit myself to one area, I’d probably go crazy from boredom.” But he seems to have found, at least for now, an interesting new line as the Internet sexual harassment suit guy. He has said that he knows of several other Silicon Alley women who are eager to take legal action. The Juno and Pseudo cases are “the tip of the iceberg,” he recently told the Silicon Alley Reporter.
Until recently, the Internet had seemed like the ultimate anticorporate, worker-friendly culture, free of the machismo and chauvinism of Wall Street. But the Internet industry, thanks to a pervasive lack of company policy and increasingly deeper pockets, may now be the target of the next wave of sexual harassment litigation.
These Internet company suits aren’t major class actions, and the companies aren’t massive blue-chip institutions like Salomon Smith Barney Inc., Merrill Lynch & Company or Morgan Stanley Dean Witter & Company. Mr. Jaroslawicz insists that there’s nothing special about these particular sexual discrimination cases, and he estimates that about 50 discrimination suits get filed every day in New York: “If I filed the same lawsuit against a hospital or some law firm or General Motors, there wouldn’t be any press on it,” he said.
Lisa Bongiorno was a 26-year-old account executive at Juno when Jordan Birnbaum, a 25-year-old vice president, began asking her to go out with him. She claimed she wasn’t interested, but just a few weeks after she was hired in February 1997, she ended up dating him, anyway. “My dating Jordan,” Ms. Bongiorno told The Observer , “was not something that I was volunteering to do. I turned him down several times, and he made it clear to me that if I wanted to make it at Juno, I wouldn’t have that attitude.” In her complaint against Juno and Mr. Birnbaum, filed in State Supreme Court in Manhattan in August, she alleges that she slept with Mr. Birnbaum out of fear of losing her job, that he harassed her and abused her verbally, and that the work environment at Juno was hostile, with male managers treating women as sexual objects.
“Women were referred to in two categories,” said Mr. Jaroslawicz. “Those I have slept with, those I will sleep with. Those I want to sleep with, those I don’t want to sleep with.” Mr. Birnbaum was sleeping with Ms. Bongiorno, until she broke up with him one month before she was fired in February 1999.
According to Gerald McKelvey, Juno’s spokesman at the public relations firm Rubenstein Associates, Ms. Bongiorno’s claim was dismissed. Mr. Jaroslawicz claims it was dismissed merely on a technicality. In any case, the judge is now considering a motion by Mr. Jaroslawicz to hear the claim on its merits.
In November, Ms. Parks, 25, filed her suit against Juno and another senior executive, Matthew Battles, 26. The complaint is very similar to Ms. Bongiorno’s, except that her relationship with the senior vice president was initially consensual, and Ms. Parks ended up leaving the company of her own accord in August 1999, after having, like Ms. Bongiorno, allegedly complained to human resources and received no help. Mr. McKelvey has said that Juno considers both Ms. Bongiorno’s and Ms. Park’s claims to be without merit.
Kelly Alfieri’s complaint against Pseudo, filed on Jan. 5, makes similar claims against Pseudo and various male managers. (It also contains more of Mr. Jaroslawicz’s grammar and spelling mistakes; a stickler for diction and detail our contingency man is not.) The complaint describes a hostile environment where women were called names and asked to perform menial tasks. Ms. Alfieri claims she was ultimately fired for complaining about the discrimination and harassment under the pretext that her skills were inadequate.
In Mr. Jaroslawicz’s view, these Internet companies are roguish endeavors run by horny kids: “You’ve got a bunch of young people, where their hormones are raging, where they’re usually very bright and just out of college, where there’s this little frat-boy and sorority atmosphere. They work long hours and under close conditions. You don’t have the formality. People don’t wear the suit and tie, so it leads to a looser relationship.” What’s more, Mr. Jaroslawicz said, these lawless businesses are typically founded by a bunch of young guys with a post-college dork complex. “A lot of these guys who are running these Internet companies are not the captain of the football team who got the girls in college. And over here now, everyone knows who he is. And if they went public, everyone knows he’s got $20 Million in his pocket, and he buys the new Porsche, and he feels like the master of the universe.”
Like the Juno happy hours that, with a dash of melodrama, he likens to “Roman orgies” (“my lawyers chose this language,” said Ms. Park, somewhat embarrassed), Mr. Jaroslawicz’s vision of the Internet industry errs toward caricature. But other harassment and discrimination experts agree that the Internet industry is currently a prime target for sexual harassment suits. “[Internet companies] are largely staffed by very young people making a tremendous amount of money,” said Philip Berkowitz, head of the employment law practice at Salans, Hertzfeld, Heilbronn, Christy & Viener. “The founders are often young. They’re not necessarily the most sophisticated in terms of understanding what their responsibilities might be. They have all the problems of start-up companies who have grown tremendously. Human resources is often not their No. 1 priority.”
Mr. Harris refused to comment on the actual lawsuit, but did agree that those were not the concerns of an Internet company trying to get off the ground: “You can’t afford a human resources person. Simple as that. I never heard of any company start-up in the first year or two that had a human resources person.” He pointed out that currently Pseudo has at least two full-time human resources people, “and that’s all they do all day.” He also said, “Companies that I work with and around make a special effort to hire and retain the best people that we can find, the implication being that we don’t retain the people that are not the best at what they do.”
What a lot of these Internet companies have failed to do so far-and what these lawsuits may prompt them to do-is to behave like big businesses, like any big business with its workplace responsibilities, and to create work environments that have policies to protect people, that offer victims someone to speak to who is not the best college buddy of the person they’re sleeping with. And it may take a few verdicts to convince Internet companies to assume company responsibilities.
“A casual work environment does not exempt them from Federal law,” said sexual harassment lawyer Hillary Richard, who represented Staci Bonner in an infamous sexual harassment suit against Spin magazine. “The law is the same whether you’re a magazine or a brewery or a brokerage house.”
“Had there been more institutionalized measures,” Ms. Richard said, “then such drastic measures [as a lawsuit] wouldn’t have been taken.”
Juno argues that the company has always had institutionalized measures in place, and Pseudo claims that theirs are better than ever. But a lot of other Internet companies may prove good targets: “They are great defendants from the point of view of plaintiffs. They are young, they haven’t necessarily adopted the policies that they should be adopting,” said Mr. Berkowitz.
And now they have a lot of money. Addressing the question of money matters and Mr. Jaroslawicz’s interest in the Juno harassment suits, Mr. McKelvey commented rather pointedly, “We have made it clear in our court filing that we find it of more than passing interest.” Mr. Jaroslawicz claims that the $10 Million cap to damages that he cites in Ms. Bongiorno’s and Ms. Park’s lawsuits is “arbitrary, whatever the secretary types in”-just as long as it has enough zeros. The number indicates the maximum damages award that the plaintiffs would seek to obtain from a jury, “so you put in some high absurd number, because you can always take less,” Mr. Jaroslawicz explained.
“I think he’s shooting for the moon here,” Mr. Berkowitz said, “and courts in New York have typically taken a pretty dim view of excessive awards.”
So how long can Mr. Jaroslawicz ride this Silicon Alley sex-suit wave? “They’re too smart, the people who run these companies, to let this get in their way,” he said. “As soon as a few of these suits get filed and get popular, they’re going to put an end to it. I wouldn’t say that it’s a particularly lucrative niche for a lawyer.”
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