Kleiner Perkins Lawsuit Gives Inside View of Clubby Venture Capital World

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From March to October 2006, he allegedly pressured Pao to "have a sexual relationship with him" and falsely told her that his wife had left him, the suit said.

Pao "eventually succumbed to Mr. Nazre's insistence on sexual relations on two or three occasions," but in October 2006 she told him she would "no longer have a personal relationship with him," the suit says. Then, over the course of five years, Nazre "engaged in retaliation against" her, including excluding her from "numerous" business meetings and removing her from business email discussions where she had been initially been included," the court filing stated.

Pao alleges that she repeatedly complained to superiors about this treatment but was told "that she should just accept it," the suit said. She also alleges "inappropriate" behavior by other male employees.

In one example, on Valentine's Day in 2007, a senior partner came into Pao's office, the suit states. He gave her a book called "The Book of Longing" by Leonard Cohen, which contained sexual drawings and poems with "strong sexual content," and invited her to dinner, explaining that his wife would be out of town, the suit states.

Christina Lee, a Kleiner Perkins spokesperson, said in a statement about the lawsuit that the firm "regrets that the situation is being litigated publicly and had hoped the two parties could have reached resolution, particularly given Pao's 7-year history with the firm."

"Following a thorough independent investigation of the facts, the firm believes the lawsuit is without merit and intends to vigorously defend the matter," Lee said in the statement. "The Firm has been a diversity pioneer in its industry and was one of the first venture capital firms to hire women as partners. The number of women partners at the firm is one of the highest within the venture capital arena and the firm has actively supported women in all respects."

The suit said that Pao "believed that the retaliation and gender discrimination were affecting her compensation at KPCB, because women generally were not treated equivalently or promoted to Senior Partner based on their gender."

Male Junior Partners, for example, "were allowed to add multiple Boards of Director positions and investment sponsorships each year, while female Junior Partners were limited to just one," the suit described.

"This difference in treatment affected compensation, because investment sponsorships impacted board positions, outside perceptions and the ability to generate returns," according to the court filing.

Pao describes instances of gender exclusion, including all-male dinners and being disinvited from a semiannual CIO meeting after complaining about being excluded. In December 2011, Pao said a senior partner told her "that the personalities of women do not lead to success at KPCB, because women are quiet."

She also cites complaints by three administrative assistants "that they were being harassed or discriminated against by KPCB partners in May 2007."

Whereas Pao claims she was told by general partner John Doerr during her performance review that she was "the top performer of the Junior Partners and that she had the most positive internal feedback," Pao complains that the firm later retaliated against her in several ways, including in subsequent performance reviews. In August 2010, her work was described as "appreciated and coveted" but the report cited "issues" with other partners.

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