March 28, 2015 / 3:50 AM / 4 years ago

In losing gender bias trial, Pao's lawyers denied millions in fees

SAN FRANCISCO (Reuters) - Former Kleiner, Perkins, Caufield and Byers partner Ellen Pao is not the only person who lost when a California jury rejected her claims of gender discrimination against the venture capital firm. Her lawyers also missed out on a payday that could have reached into the millions of dollars.

Ellen Pao (R) and attorney Alan Axelrod arrive at the courthouse to hear the verdict in her high profile gender discrimination lawsuit against venture capital firm Kleiner, Perkins, Caufield and Byers in San Francisco, California March 27, 2015. REUTERS/Beck Diefenbach

Pao sought about $16 million in lost wages and tens of millions more in punitive damages in a lawsuit that captivated Silicon Valley. Had Pao won on any of her claims, under California law her legal team, led by longtime San Francisco employment lawyers Alan Exelrod and Therese Lawless, could have sought all its fees from Kleiner.

Friday’s result underscores how risky trials can be for the lawyers who represent employees, who generally do not bill by the hour. They are usually paid either a percentage of any settlement, or by seeking fees from the defendant if they win at trial.

Pao’s 2012 lawsuit was just one among several that have been filed against Silicon Valley tech companies over gender, and employment lawyers watched the case particularly closely, filling the seats of the courtroom.

Earlier in March, Lawless filed a separate lawsuit against Facebook Inc over allegations an employee was sexually harassed and faced gender discrimination.

A 2013 employment trial in the same San Francisco Superior Court as the Pao case provides some guidance about how much her lawyers could have recovered had the verdict gone her way.

While the cases are different, the rules for collecting fees would have been similar in the Pao case, which ended on Friday with the jury clearing Kleiner of gender discrimination and retaliating against Pao for suing the firm.

Exelrod and Lawless were not immediately available to comment on fees.

In the 2013 case, a woman who sued a Catholic school for gender and age discrimination went to trial for more than a month in San Francisco Superior Court. Among several claims, the jury sided with her on an unpaid vacation time claim, and awarded her about $16,000 in damages.

After the verdict her attorney, John McGuinn, told the judge in court filings that he worked 1,635 hours on the case from his initial meeting with the client through verdict, and listed his rate at $750 per hour. One of his associates worked 794 hours at $395 per hour.

At those rates, the total amount for McGuinn’s team would have topped $1.5 million, though he sought less because of the narrow win. The judge ultimately awarded about $618,000 in fees and costs, and the case has been appealed.

McGuinn could not immediately be reached for comment.

Exelrod, Lawless and McGuinn all have similarly long experience as employee attorneys in San Francisco. In court filings, McGuinn said one of Exelrod’s partners has been awarded $775 per hour in another wage case.

Kleiner’s lead lawyer Lynne Hermle, of the Orrick Herrington & Sutcliffe law firm, billed about $725 per hour in 2011, according to court filings in a separate case.

The law likely would not allow the venture capital firm to seek attorneys fees from Pao, who has the right to appeal the verdict. Kleiner, however, could seek reimbursement for costs associated with the lawsuit, such as expert witness payments, deposition expenses and court filing fees.

A Kleiner spokeswoman declined to comment on whether it would seek costs from Pao.

Trials are often well produced multi-media events, with videos, slide presentations and thousands of pages of transcripts, and the Pao case was no exception.

James Brown, who represented the Catholic school at trial and was not involved in the Pao case, said costs in the Pao case could be between $100,000 and $200,000, depending on the number of depositions.

Editing by Peter Henderson and Grant McCool

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