N.Y. Landmark Pays $2M to Settle Sex Claims

June 3, 2008 — -- One of New York City's most famous restaurants will pay $2.2 million to settle a lawsuit over sexual harassment and racism allegations.

Tavern on the Green, the 74-year-old café overlooking Manhattan's Central Park, is accused of "severe and pervasive harassment," including one manager's grabbing of an employee's breasts and buttocks and his repeated use of racial slurs and lewd sexual references.

The U.S. Equal Employment Opportunity Commission filed a lawsuit against the restaurant in September 2007. The EEOC announced the settlement on Tuesday.

EEOC lawyer Kam S. Wong said that some 50 former and current employees will be eligible for compensation from the settlement.

"Even a high-end establishment is not an exception to the world of harassment and retaliation, unfortunately," Wong, a senior trial attorney with the EEOC, told ABC News. "A settlement as significant as this one should send a message to all employers that EEOC takes seriously and will strenuously enforce the laws against discrimination in the workplace."

The settlement also requires the restaurant to adopt an anti-discrimination policy and provide anti-discrimination training to its employees. According to a court document, the settlement is not an admission of wrongdoing.

In a statement e-mailed to ABC News, the restaurant said it was "pleased this long-pending matter has been amicably settled" and maintained that "Tavern on the Green always has been and will continue to be committed to providing a safe, non-discriminatory and non-retaliatory work environment for its employees."

According to the statement, the management staff cited in the lawsuit "have not been associated with the restaurant for years."

The complaint filed against Tavern on the Green revolved largely around allegations against Leon Drogy, the restaurant's former director of operations. According to the complaint, Drogy engaged in "repeated sexual touching" of restaurant hostess Martha Nyakim Gatkuoth, including grabbing her breasts and buttocks.

Drogy also allegedly made comments about Gatkouth's private parts and demanded that she perform oral sex and engage in other sexual acts with him.

Other allegations against Drogy include: sexual harassment of other female employees; the use of racial epithets against black employees; and the harassment of Hispanic employees with slurs and phrases such as "ignorant immigrant."

In a short statement e-mailed to ABC News yesterday, Drogy's lawyer, Brian S. Kaplan, said that any allegations against his client in the lawsuit are "a fiction."

"[A]ccordingly, Mr. Drogy has repeatedly and categorically denied them," Kaplan wrote.

Drogy declined to speak directly to ABC News.

Drogy left Tavern on the Green in 2005. That year, he was arrested on misdemeanor charges of sexual abuse and forceable touching, according to Barbara Thompson, a spokeswoman for the Manhattan District Attorney's Office. Wong said the charges were filed by Gatkouth and another individual.

In 2007, a lawyer representing Tavern on the Green told The New York Times that Gatkouth had been the one to file criminal charges against Drogy and that the charges were dropped because Gatkuoth was not credible and that there was not evidence to support her allegations.

Thompson confirmed that the charges had been dropped but said that she could not provide further detail because the case had been sealed.

Wong said that the 2005 criminal case had no bearing on how the EEOC viewed Gatkouth's claims.

"We would not have filed a lawsuit on behalf of Ms. Gatkouth and on behalf of other victims if we did not believe there was this pattern and practice of harassment and retaliation," she said.

Under the terms of the settlement agreement, Gatkouth, 25, quit Tavern on the Green last week after working there for four years.

In an interview with ABC News yesterday, Gatkouth said she was happy with the settlement and that she hoped it would help raise awareness of harassment in the workplace.

She said she wanted others who have experienced harassment "to know that you're not alone and there's a lot of people out there that will help you."

ABC News' Melissa Lenderman contributed to this story.