Former Silicon Valley Venture Capital Partner Wants 'Justice' in Sex Discrimination Suit

PHOTO: Ellen Pao outside Menlo Park, Calif., in this April 4, 2006 file photo.

A former partner of a venture capital firm who filed a sex discrimination lawsuit wants "justice to be served" in court, exposing what she says is the exclusive, often male-dominated world of Silicon Valley finance at Kleiner Perkins Caufield and Byers.

Ellen Pao, 43, a former investment partner with Kleiner Perkins Caufield and Byers, filed a lawsuit against the company in May 2012, alleging the firm engaged in sex discrimination against her and other female employees. She said she faced retaliation when she complained of multiple instances of sexual harassment, which included being pressured by a junior partner to have a sexual relationship and being given a book that had "sexual drawings" and poems with "strong sexual content."

"Kleiner Perkins has been really dragging its feet," Pao told ABC News. "It has lost twice in Superior Court and has been delaying and extending the date for every single step of the process. I'm excited to move forward and have my day in court and for justice to be served."

She seeks unspecified compensatory damages, punitive damages, and other forms of relief.

Kleiner Perkins, based in Menlo Park, Calif., is seven miles away from Facebook's headquarters, one of the many tech firms in which it has invested in its 40-year history. Google, Zynga and Groupon are among other beneficiaries of Kleiner Perkins' investments, which range from $100,000 to $50 million, the suit states.

Pao, of San Francisco, was hired by Kleiner Perkins in June 2005 as a junior partner after working at several other technology firms and one law firm. She studied electrical engineering at Princeton and went to Harvard Law School and Harvard Business School.

She was fired in October and currently works at social media site Reddit.

In a statement to ABC News, Kleiner Perkins Caufield and Byers, which has denied Pao's allegations, said the matter should be resolved through arbitration.

On Wednesday, a lawyer for the venture capital firm argued before California state court appellate justices that the firm preferred arbitration to avoid disclosing the relative compensation of Kleiner's partners and to spare embarrassment to Pao. The justices have up to 90 days to make a decision, as first reported by the San Jose Mercury News.

"The issues Pao is litigating involve economics of the funds she was involved with, including carry, investment decisions, appointments to boards, voting rights among others," the firm said in its statement to ABC News. "All of those economic issues are governed by the Managing LLC agreements, which require that disputes be resolved through arbitration."

In 2012, the California Superior Court ruled that the case should go to trial and not arbitration. Kleiner appealed the decision.

Teresa Nelson, a professor at Simmons School of Management in Boston and faculty affiliate at the Center for Gender in Organizations, said women are as rare as partners in venture capital firms as they are recipients of venture capital funding.

Without commenting specifically about Pao's case, Nelson said professional partnerships like those of venture capital firms have a distinct organizational style than corporations, which are large and run by a board of directors.

"How decisions get made, how people participate, how they're recruited" are usually through a "tight funnel" in the world of venture capital, she said.

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