Harvey Weinstein and Roger Ailes Emulated Wall Street’s Private Justice System

By Pam Martens and Russ Martens: October 9, 2017

Harvey Weinstein Accepting an Oscar for "Shakespeare in Love" at 1999 Academy Awards

Harvey Weinstein Accepting an Oscar for “Shakespeare in Love” at 1999 Academy Awards

Following a detailed investigative report that appeared on the front page of the New York Times last Friday, along with additional disturbing reports over the weekend, the powerful Hollywood producer, Harvey Weinstein, was fired yesterday by The Weinstein Company, the film studio he founded with his brother, Bob, in 2005. The two were previously the co-founders of Miramax Film Corp. It was sold to Disney in 1993.

According to the Times and other reports that followed, Weinstein is a sexual predator who has harassed his own employees in the workplace as well as actresses seeking jobs during hotel interviews.

Weinstein, like Fox News founder Roger Ailes, was said to have perpetrated his sexual misdeeds over many years without public disclosure by effectively creating his own private justice system – using private monetary settlements with gag orders for their accusers instead of public courtrooms where the claims would have been reported by the press, decided by the public jury system based on witness testimony and detailed evidence obtained in discovery. Had the nation’s court system been utilized, dozens of future female victims would have been spared the trauma and lifetime scars of these sexual predators.

What Weinstein and Ailes did was a less formalized version of Wall Street’s private justice system – where all industry workers must sign away their rights to access the public courts and agree to try all claims against the firm, and the prolific sexual assaulters and harassers that work on Wall Street, in an industry-run private justice system known officially as mandatory arbitration but more accurately as kangaroo courts. (See related article below.)

It is these private justice systems and their enablers – the lawyers who have allowed them to proliferate — that have emboldened the sexual ogres in the workplaces of America.

The plaintiffs’ lawyers who craft these private settlements and iron-clad non-disclosure agreements (gag orders) are turning their backs on the intent of the Civil Rights Acts of 1964 and 1991. These legislative acts, passed by both houses of Congress and signed into law by the President of the United States, provide civil rights protections in the workplace including anti-discrimination statutes and court remedies to stamp out sexual predators who use their position of superior rank to sexually harass colleagues.

The legislation confers on the private litigant the role of private attorney general to pursue not only her own claim but to vindicate the rights of other women to a workplace free of harassment and discrimination. The Equal Employment Opportunity Commission (EEOC), the Federal agency that enforces the civil rights acts, has filed amicus briefs with appellate courts, outlining the importance of the private litigant’s role in functioning as a private attorney general on behalf of society as a whole.

In a 2003 paper, Stanford Law Professor, Pamela Karlan, explained the critical role that these private attorneys general can perform on behalf of society. Karlan writes:

“The idea behind the ‘private attorney general’ can be stated relatively simply:  Congress can vindicate important public policy goals by empowering private individuals to bring suit…Virtually all modern civil rights statutes rely heavily on private attorneys general…Congress harnessed private plaintiffs to pursue a broader purpose of obtaining equal treatment for the public at large.”

Karlan goes on to explain that when the plaintiff is denied her day in court, the important public policy enshrined by the civil rights acts goes unvindicated, and the entire Nation suffers.

Indeed, the United States has suffered serial embarrassment and loss of credibility as an enlightened society from the claims against Weinstein and Ailes and the even more serious claims against Bill Cosby, which include rape.

An underlying concept embedded in the role of the private attorney general is that women of conscience would be bringing important cases to the courts and juries would be awarding high damage awards, and potentially punitive damages, to send a message to all would-be sexual predators that shame and loss of career will be the outcome of this behavior. The message would also be sent to the Boards of the companies that shareholders will pay a hefty price if written workplace policies to eliminate this conduct are not seriously communicated and enforced.

Similar to the Weinstein matter, the power by men on Wall Street to sexually harass with impunity has been an open, dirty secret for decades. (See Editor’s Note below.) On June 9, 1994, Margaret Jacobs, writing for the Wall Street Journal, detailed the case of  Helen L. Walters:

“Helen L. Walters says her boss called her a ‘hooker,’ a ‘bitch’ and a ‘streetwalker.’ Sometimes he brandished a riding crop in front of her and once he left condoms on her desk.

“Ms. Walters, then a trading-room secretary at a California brokerage firm, filed a complaint against him alleging sexual harassment.  In a formal hearing, he readily admitted to the whip and the condoms, and to using all of those epithets.  Her case, legal scholars agree, seems a textbook example of illegal harassment as defined by the Supreme Court: a situation in which a ‘reasonable person’ would find the work environment ‘hostile or abusive.’

“So why did Ms. Walters lose?

“Ms. Walters slammed into a little-known, but extraordinarily daunting, roadblock facing many women in the securities industry: Bias complaints, like any other employee dispute, must go through the industry’s mandatory-arbitration system.  That means victims’ complaints can’t be heard in court by judge or jury, no matter how strong their merit.”

Editor’s Note: The Editor of Wall Street On Parade, Pam Martens, was the lead named plaintiff in a high profile Federal class action lawsuit filed in 1996 which sought to overturn mandatory arbitration on Wall Street for civil rights plaintiffs and shine a bright light in the public courtroom on the egregious sexual harassment and sexual assault experienced by women on Wall Street. Martens walked away from the settlement crafted by the attorneys, which enshrined gag orders and left mandatory arbitration in place on Wall Street.

Related Article:

Wall Street’s Kangaroo Courts Perpetuate a Business Model of Fraud

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