It is standing room only in court 602 of the superior court of San Francisco, the hallways are blocked by television news crews and satellite TV trucks line the sunny streets outside.
Of those who have managed to secure a seat in the courtroom, a significant proportion have laptops out, busily transcribing every word of the proceedings straight to live blogs for the many tech websites fighting to provide the most comprehensive coverage.
San Francisco – and the rest of Silicon Valley – is gripped by proceedings behind the double doors of court 602, where former venture capitalist Ellen Pao – now interim chief executive of social news site Reddit – is suing storied venture capital firm Kleiner Perkins Caufield & Byers for $16m in a landmark sexual discrimination case. The courthouse itself is even tweeting updates of the trial.
The Silicon Valley technology cluster has long been accused of behaving as a boys’ club, with women occupying just 11% of executive positions, according to a recent diversity report by law firm Fenwick & West. But no one in the Valley can remember a senior woman ever taking a tech company or venture capital firm to court over sex discrimination.
“Everyone, everyone is talking about it – this case is putting sexism in the Valley on trial and it’s a very big deal,” says Nitasha Tiku, one of those blogging the trial for tech news site the Verge. “Sex discrimination has long been talked about, there have been lots of accusations, but any claims have always been settled out of court with NDA [non-disclosure agreements], so no one knows what happens.”
Tiku said the Pao trial also has the Valley gripped as it is revealing the inner workings of one of the world’s most secretive industries: venture capital. “It is such a private world, but here we get to see how they talk to each other, read their emails and see how they make investment decisions. It’s unprecedented.”
Pao, 45, claims she was passed over for promotion and excluded from important meetings because of her gender after she accused a senior Kleiner Perkins partner of sexual harassment.
She claimed in the packed court house that she and other women were barred from work trips on private jets and ski resorts, and not invited to an important Kleiner Perkins dinner with former US vice-president Al Gore.
“It was said that if there were women there, the conversation would be tempered and it was because women kill the buzz,” she said.
At the time of the dinner, Pao lived in the same building as Gore and said she had to explain she wasn’t going to the dinner because she was a woman. “It was pretty humiliating,” she said.
The organiser of the dinner, Chi-Hua Chien, denied saying women would “kill the buzz”, but conceded that the dinner was a male-only affair.
Pao, who studied electrical engineering at Princeton University and holds both a law degree and MBA from Harvard, said the male partners preferred to meet without women in part so they could discuss their favourite porn stars – prompting an attorney to awkwardly ask which porn stars, to the amusement of the courtroom.
Pao claims the discrimination began after she complained about harassment by married male colleague Ajit Nazre, with whom she claimed she was pressured into having an affair.
Details of the affair, including its office-based beginnings, were played out to the six men and six women of the jury and roughly 150 onlookers in court. Lynne Hermle, Kleiner Perkins’ attorney, asked Pao if the couple had kissed in the parking lot of Kleiner’s Silicon Valley headquarters on Sand Hill Road in Menlo Park. “I believe I did that once or twice,” Pao said.
On Valentine’s Day in 2007, senior Kleiner Perkins partner Randy Komisar gave Pao a signed copy of Leonard Cohen’s The Book of Longing, which she took as a sexual advance. “The problem was the book had very erotic poetry in it and Cohen’s many sketches of naked women,” the attorney said. Kosimar has said that the book was a return gift chosen by his wife.
Hermle, who, according to Silicon Valley folklore, once made an opposing lawyer vomit in court under her quick-fire questioning, pointed out that Pao had kept hold of the book for years before filing the lawsuit in 2012. “You drove around with the book of poetry in your trunk for years while you were consulting lawyers?” Hermle said. “It was in my car while I was driving, but I didn’t drive it around for years,” Pao replied.
Kleiner Perkins, which was an early investor in Google, Amazon and Uber, denies all the allegations and said Pao was fired from her $560,000 a year job at the firm in 2012 because she lacked the leadership and interpersonal skills to succeed.
The trial has revealed alleged sexual discrimination not just at Kleiner Perkins but across the tech companies of Silicon Valley, roughly 40 miles south of San Francisco. The chief executive of an unnamed tech company backed by Kleiner Perkins was said to have talked about appointing Yahoo boss Marissa Mayer to its board because she was “really hot”.
Liz Gannes, a reporter live-blogging the trial for tech news site Re/code, said the case was helping to focus minds on the lack of women in technology across the world. “It’s part of a growing crescendo of discussion about the growing lack of women in technology, and the reason that’s such a big issue is because technology is of such importance to so many people’s lives in the world right now that it matters who makes it,” she said.
“The people who provide the funding – the venture capitalists – are even more important. Within that group, only a tiny proportion of senior investment professionals are women ... the most optimistic number is 7%. It’s widely agreed it’s a terrible, terrible percentage.”
Women hold 11% of executive positions at Silicon Valley companies compared to 16% across the top 100 Standard & Poor’s firms, according to a report by law firm Fenwick & West. Silicon Valley firms boards are on average 15.7% female compared with 20.9% in the S&P 100.
Venture capital firms are even less diverse than the technology companies in which they invest. Babson College’s Diana Report, a research initiative working to increase the number of female entrepreneurs, found that the number of female partners in VC firms decreased from 10% in 1999 to 6% in 2014.
The report found that 97% of VC-funded businesses had male chief executives, and businesses with all-male teams are more than four times more likely to receive VC funding as teams with one or more women.
Pao said she was suing her former employer for such a large amount because only an eight-figure settlement would “hit their radar” and force change in the west coast technology scene’s “boys’ club”. “I wanted my payment to be enough so it was a meaningful amount to Kleiner Perkins, so they saw it would be painful to not fix problems.”
Pao’s attorney, Alan Exelrod, told the court: “Kleiner Perkins had promoted just one woman to senior investing partner by 2011, despite being in business for about 40 years.
“Kleiner Perkins used Ellen Pao’s talents for six years, but when it came time to choose the next generation of leaders at Kleiner Perkins, Kleiner only chose men.”
However, Hermle questioned whether Pao had done her bit to help women up Silicon Valley’s ladder. “Did you ever recruit a woman to a Kleiner portfolio company’s board?” Hermle asked. “I don’t believe so,” Pao replied.
The trial continues.
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