When a powerful male lawyer at Goldman Sachs was found to be sexually harassing a female subordinate, the wealthy investment bank didn’t take action against him — it tried to sweep the incident under the rug.
That is the allegation lodged by former deputy counsel at the bank, Marla Crawford. Crawford claimed in a lawsuit that she faced retaliation, including losing her job, when she complained about the handling of the matter, in which the bank’s Global Head of Litigation Darrell Cafasso “used his position to romantically prey” on a young woman.
Now the bank is working even harder to muzzle Crawford. In court filings, the bank has argued that the case shouldn’t be brought to court, and instead should be heard in a confidential arbitration. The former deputy counsel is fighting back, though, and trying not to keep her claims from being forced behind closed doors. A judge has yet to rule on whether the case will be dismissed and moved to arbitration.
“I am asking that Goldman change its disposition towards employees who raise internal complaints — rather than treat us as ‘the enemy,’ we should be treated as courageous employees whose interests align not conflict with the bank,” Crawford said in an open letter to Goldman Sachs’ top executives and board members.
“I have received many messages of support from current and former Goldman employees who applaud my efforts and are cheering my attempts at transparency,” she continued, asking the company to “relieve me and all other employees from confidential arbitration and non-disclosure agreements” which “only protect wrongdoers at the bank.”
This is hardly the first time an employer has sought to conceal its dirty laundry behind confidentiality and arbitration agreements rather than address problem employees and behaviors. A wealth advisor at Morgan Stanley has been trying to reinstate a workplace harassment lawsuit, arguing earlier this month that she did not forgo her right to sue merely by clicking “agree” on an email containing an arbitration disclosure.
These incidents of employers invoking arbitration clauses when faced with sexual harassment claims are still happening despite state laws that were passed in the wake of #MeToo, specifically prohibiting those types of claims from being forced into arbitration. The problem is that the state laws conflict with the Federal Arbitration Act, which requires that those provisions in contracts shall generally be upheld by courts.
In Crawford’s case, she alleged that senior legal counsel at Goldman Sachs perpetuated an environment where “sexual harassment is covered up and the powerful are cloaked with immunity.” When she attempted to speak up about misconduct, “the result was a broadside attack on her performance and then terminating her after more than 10 years of exemplary performance,” according to her suit, filed in New York state court.
The former deputy counsel said she was the “confidant” of the young female employee targeted by Cafasso. The senior litigation lawyer apparently confessed unrequited strong feelings for the young woman, who was his employee, and promised her job benefits if she would “return the favor,” Crawford alleged. According to the suit, the bank eventually learned of the conduct and retained an outside law firm to conduct a probe but never disciplined Cafasso. The young woman, however, ended up leaving her job.
At the time the probe was conducted, according to Crawford, the bank’s general counsel called it a “sticky situation,” and told a colleague: “Let’s try to put this genie back in the bottle.”
If you're worried about losing your job for reporting sexual harassment or fear that your employer will retaliate against you by cutting your hours, demoting you, or making your work life difficult, speak to our experienced attorneys today. It's critical that you file sexual harassment claims as soon as possible. Depending on where you live, you may have as little as six months to file a claim.
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