Was Paul Weiss an Appropriate Law Firm to Investigate Sex Charges Against Roger Ailes?

By Pam Martens and Russ Martens: August 24, 2016

Andrea Tantaros of Fox News Brings New Charges

Andrea Tantaros of Fox News Brings New Charges

On Monday, Andrea Tantaros, a Fox News host, became the latest in a growing drumbeat of voices charging Fox News with tolerating and condoning a hostile work environment for women that “operates like a sex-fueled, Playboy Mansion-like cult, steeped in intimidation, indecency, and misogyny,” according to the lawsuit Tantaros filed in New York State Supreme Court.

Tantaros charges in the lawsuit that she was sexually harassed by Roger Ailes, who recently stepped down as Fox News CEO, while he ran an intimidation campaign against her through his public relations department. This is the second lawsuit to be filed against Ailes by Fox News women in as many months. In July, Gretchen Carlson went public with similar charges against Ailes in a high-profile lawsuit. According to the Washington Post, Carlson’s lawyers have received reports from more than 20 women that “they were harassed by Ailes during his long career in television, dating as far back as the mid-1960s.”

One of those women, Laurie Luhn, went on the record with Gabriel Sherman of New York Magazine. Luhn told Sherman that “she had been harassed by Ailes for more than 20 years, that executives at Fox News had known about it and helped cover it up, and that it had ruined her life.” Sherman reported that he was able to independently corroborate key details in Luhn’s account as well as viewing a $3.15 million severance agreement that was paid to Luhn in exchange for “iron-clad nondisclosure provisions.”

“Iron-clad nondisclosure provisions” is the stock and trade of Wall Street powerhouse law firm, Paul, Weiss, Rifkind, Wharton & Garrison, which has been handling fraud charges against the serially charged Wall Street bank, Citigroup, for decades. (See our previous report on Paul Weiss here.) Paul Weiss was brought into the Ailes matter to conduct an internal investigation by Fox News parent, 21st Century Fox.

Paul Weiss also has a history of being charged with corporate bias in the way it conducts those internal investigations of sexual assault and/or sexual harassment claims. Two such charges have already emerged against Paul Weiss in the Ailes/Fox News matter. On August 2, Lloyd Grove of The Daily Beast reported that an attorney for former Fox News anchor Laurie Dhue had released a statement criticizing Paul Weiss over its internal investigation. The attorney, Bruce Schaeffer, stated the following:

“[I]n light of recent news stories revealing, among other things, that former FNC employee Laurie Luhn had to approach Paul, Weiss about her relationship with Roger Ailes (rather than Paul, Weiss approaching her) we wanted to let you know that Paul, Weiss has thus far not contacted us as part of its investigation, which fairly questions the credibility of its investigative process.”

In the lawsuit that Tantaros filed on Monday, she too has raised questions about the Paul Weiss investigation. The complaint reads:

“Although a respected law firm, Paul, Weiss, Rifkind, Wharton & Garrison LLP (‘Paul Weiss’) has been hired to conduct an internal investigation of Fox News, the results of Paul Weiss’s investigation will not, according to published reports, be made public. Worse still, according to a published report, Paul Weiss has ceased questioning Fox News female employees at the offices of Fox News out of fear that the interviews are being bugged;

“There has been no effort to interview Tantaros or, on information and belief, former Fox News employees who surely have pertinent information; and

“Most importantly, the Murdochs have actually rewarded Ailes’s coconspirators by not terminating their employment, and, most egregiously, elevating [William] Shine to the position of Co-President of Fox News.”

Ailes has stepped down from his post as CEO of Fox News but the Tantaros lawsuit questions that outcome as follows:

“In any responsible company, Ailes’s employment agreement (unless it has a provision permitting him to harass women) would have been terminated for cause, with no further compensation. Instead, on information and belief, the Murdochs gave Ailes a $40 million going-away present.”

Paul Weiss was also hired to assist a Special Committee of the Board of Trustees of Syracuse University to investigate the actions of Syracuse University in 2005 when Bobby Davis reported that he had been sexually molested while a minor by Bernie Fine when Davis was a ballboy for the University’s men’s basketball team and Fine was an Assistant Coach. Prominent attorney, Gloria Allred, was the attorney representing Davis in 2012 when the Paul Weiss-assisted findings were released by the Special Committee of the Trustees. Allred called the report “a complete whitewash, is self serving, suffers from a lack of transparency and raises more questions than it answers…”

In her 9-page statement eviscerating the findings, Allred pointed out two particularly glaring problems:

“The Report acknowledges that law enforcement should have been notified and that the Board of Trustees should have been notified, about Bobby Davis’ allegations but concludes that there was no effort to sweep this under the rug.

“This conclusion does not pass ‘the laugh test’ and appears to us to be preposterous on its face.”

Allred writes further:

“Despite spending nearly 8 months purporting to merely investigate the underlying 2005 putative investigation (which itself lasted less than 3 months) the University has failed to produce the underlying notes and files that were examined or described with any specifics describing how long and what was discussed in its interviews which were done with litigation counsel present.”

Paul Weiss represented Wall Street investment firm Smith Barney from 1996 to 2001 over charges brought in Federal Court that the firm had created a work environment so hostile that women were sexually assaulted during the workday without reports to the police and with the assaulters keeping their jobs if they were high-producing brokers. (See editor’s note below for the role the co-author of this article played in that lawsuit.) The suit also sought to bring an end to Wall Street’s private justice system, known as mandatory arbitration, which functions as a protection racket for the perpetuation of these crimes in the workplace.

In a Memorandum of Law filed by Ailes in the Carlson lawsuit, he attempted to invoke a similar mandatory arbitration clause to move Carlson’s claim out of an open court proceeding and into a secret tribunal. The clause reads as follows:

“Any controversy, claim or dispute arising out of or relating to this Agreement or Performer’s [Plaintiff’s] employment shall be brought before a mutually selected three-member arbitration panel and held in New York City in accordance with the rules of the American Arbitration Association [‘AAA’] then in effect…Such arbitration, all filings, evidence and testimony connected with the arbitration, and all relevant allegations and events leading up to the arbitration, shall be held in strict confidence.”

The Paul Weiss settlement in the Smith Barney case came under withering criticism in the press. It was revealed that while the case was pending before Judge Constance Baker Motley, the Paul Weiss law firm made job offers to two of the Judge’s law clerks assigned to the case. The New York Post revealed that the sexual harassment hotline that was ostensibly set up by Smith Barney to help women make complaints wasn’t working. The lead lawyer for Paul Weiss in the case, Mark Belnick, moved on to become General Counsel at Tyco International and was indicted for grand larceny and securities fraud. He was acquitted at trial but only after he had inked a retention agreement that guaranteed Belnick a payment of at least $10.6 million should he commit a felony and be fired before October 2003. Any disputes arising out of the retention agreement matter were to be handled in arbitration under the rules of the – wait for it – American Arbitration Association.

The National Organization for Women of New York State was so appalled by the terms of the Smith Barney settlement that its President, Lois Shapiro-Canter, an attorney, filed an Amicus brief with the court asking the Judge to reject the settlement. Shapiro-Canter wrote on behalf of NOW-NYS:

“Employers are increasingly using tactics to limit their own liability under federal and state laws to limit access of their employees to civil rights laws. The securities industry requirement that all employee disputes including allegations of sexual harassment and assault must go before employer-selected mandatory arbitration or mandatory alternative dispute resolution panels has created a hostile work environment for women in the securities industry.

“Closed door proceedings and arbiters of justice chosen in part by Defendant Employer confers the appearance of impropriety and does not reflect the open door access to the judiciary of Title VII and other civil rights laws. If in fact Defendant Employer intends in good faith to proceed wholeheartedly with the diversity plans outlined in the agreement, why does it need a mandatory arbitration process a/k/a mandatory alternative dispute resolution system which denies women and minorities their constitutional right to access the courts to ensure freedom from discrimination and sexual harassment?”

The women of Fox News might want to put on their news researcher hats and dig much deeper into what exactly is going on behind the scenes in the Ailes matter.

Editor’s Note:

Pam Martens, the co-author of the above article and Editor of Wall Street On Parade, worked for two major Wall Street firms for 21 years. During that time, from 1996 through 2001, Martens challenged Wall Street’s mandatory arbitration system and the sexual assaults and sexual harassment of women facilitated under that system in the U.S. District Court for the Southern District of New York and at the 2nd Circuit Court of Appeals in a case titled Martens v Smith Barney in which she originally served as lead plaintiff. The settlement fashioned by plaintiffs’ attorneys and Paul Weiss was deemed so conflicted by Martens that she withdrew from the settlement and never profited, by even a dollar, from the settlement or any subsequent payment from the parties.

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