CASE STUDY: SEXUAL HARASSMENT CASE
The Problem
Our client (“the Company”) was a small, closely-held business in the home furnishings industry; ownership was not active in the management of the Company, which had been left entirely in the hands of the General Manager. The Company had no internal harassment complaint or investigation procedures. A lawsuit was filed against the Company in state court by five former employees, alleging that they had been sexually harassed by the General Manager. The aggregate settlement demand was in excess of $1,000,000.
The Resolution
We reviewed the five harassment claims and found that, while four of the claims were insignificant in themselves, the four plaintiffs involved were in a position to be very damaging witnesses in the fifth case, which was viable and had the potential to cost our client a great deal of money. We negotiated a very inexpensive settlement with the first four defendants that imposed confidentiality requirements that would discourage them from appearing as witnesses in the fifth case. Then we turned our attention to the fifth case. By this time it had become apparent that the General Manager was a true rogue employee, as it had come to light that he had embezzled money from the Company. We filed a motion to dismiss in the fifth case, contending that the Company had no “actual or constructive knowledge” of the actions of its rogue General Manager. We effectively argued that such “knowledge” would be required under state law for liability to be assessed against our client. The case was dismissed, reducing our client’s expense from seven figures to five figures, including settlement and legal costs.
Case studies are provided by Greenwald Doherty for informational purposes only. They do not contain legal advice, nor are they to be used as a substitute for legal advice. Fact patterns vary tremendously from one case to another, and potential outcomes depend on the particular elements and details present in each individual case. No result in any future action can be guaranteed, regardless of any superficial resemblance to any case described in a Greenwald Dohertycase study.