| SAN FRANCISCO, June 26
SAN FRANCISCO, June 26 A high-profile Silicon
Valley sex discrimination lawsuit moved closer to a trial after
a panel of justices ruled that venture capital firm Kleiner
Perkins Caufield & Byers cannot take a former partner's claims
The suit, which pits former partner Ellen Pao against one of
Silicon Valley's most storied venture firms, alleges harassment,
discrimination and retaliation. It became the talk of the Valley
last year with its references to an affair and its allegations -
denied by the firm - of sexual advances and sexist behavior.
The firm had argued that Pao's suit, filed in May 2012,
should move to the private process of arbitration because Pao
signed operating agreements with mandatory arbitration clauses
for the funds she was involved in.
Pao's lawyer, Alan Exelrod, argued that the clauses did not
apply because Pao was suing Kleiner itself - not its funds. Pao
never signed any arbitration agreements with the firm itself,
On Wednesday, a panel of justices at the California Court of
Appeal in San Franciso agreed.
"Pao's claims have their origin or genesis in the offer
letter, which does not contain an arbitration clause," they
wrote, referring to the firm's original offer of employment to
Pao. "Pao is not bound to arbitrate her complaint against KPCB."
Pao did not immediately respond to a request for comment.
Kleiner Perkins said it had no comment beyond a statement last
week in which it argued that arbitration was appropriate because
Pao's case involved compensation, which was linked to fund
"The issues Pao is litigating involve economics of the
funds she was involved with," the firm said in that statement,
issued after a hearing on the matter. "All of those economic
issues are governed by the Managing LLC agreements which require
that disputes be resolved through arbitration."
Kleiner has 40 days to decide whether to appeal against the
The lawsuit has inspired debate especially in the Bay Area
on its specific merits as well as the broader issue of sexism in
the technology sector.
Until Pao's lawsuit, issues surrounding gender had largely
been brushed under the rug in the clubby world of venture
capital. Since the lawsuit was filed, female employees at
Pantheon and CMEA have also filed lawsuits alleging
discrimination, but the firms have a lower profile than Kleiner.
The firm is known for backing companies such as Netscape,
Amazon.com Inc and Google Inc.