Peter Vieth//January 14, 2016
Peter Vieth//January 14, 2016//
Former LeClairRyan partner Michele Burke Craddock claims in her lawsuit that she was a victim of pervasive gender discrimination before she left the firm last year. She says the workplace hostility increased as her performance and earnings outstripped many male attorneys in the office.
The lawsuit adds claims that LeClairRyan has a history of discrimination towards its female attorneys in “compensation, leadership, selection, advancement and other terms and conditions of employment.”
Her lawsuit filed Jan. 6 in Richmond federal court demands both an order barring gender discrimination at the firm and compensatory damages to be set by a jury.
Many of her claims were unveiled last year when she filed an EEOC complaint in federal court in a procedure aimed at preserving evidence for her case.
The law firm defended its actions and its reputation in an arbitration demand filed with the American Arbitration Association on Dec. 11. The firm is represented by attorneys at the Norfolk and Richmond offices of Kaufman & Canoles PC.
LeClairRyan pointed to its inclusion on lists of top 100 law firms for diversity, top 100 law firms for women, and top 100 “Best U.S. Law Firms for Female Attorneys.”
Craddock’s lawsuit and the firm’s response center on her involvement with a headline-grabbing lawsuit that produced a $77 million settlement in 2013. It was the largest reported settlement of that year, according to Virginia Lawyers Weekly.
The case generated $23.5 million in fees over four years, the largest fee recovery in the firm’s history, according to Craddock’s suit.
Craddock’s bonus from the case was more than $1.1 million, the same as two male attorneys who worked alongside Craddock, LeClairRyan said.
But Craddock claimed she also was entitled to “origination credit” for retaining the case. She said the client, now deceased, had become “dissatisfied” with the originating partner and had fired the firm and demanded return of the file.
Craddock contends she saved the case for the firm by meeting with the client and renewing the client relationship.
The client was originally brought to the firm by the other attorney and Craddock “was not entitled to those credits under established firm policy,” LeClairRyan responds.
“Around this same time, Craddock’s billing and client origination production began to decline,” the firm continued in its arbitration demand.
Craddock describes a different performance picture.
“Craddock’s team’s efforts were key to propping the Firm’s sagging financial condition in years that it struggled to make budget,” her lawsuit said.
“The failure to promote Craddock in 2011 disregarded her fiscal year 2011 file originations of over $2.5 million, working attorney fees of over $600,000, with a 3-year average of over $1 million originations and over $550,000 working attorney fees,” the lawsuit reads.
Craddock’s dispute with firm management came to a head in late 2014. Craddock, 49, was the breadwinner for her family, had two sons in college and was struggling to qualify for the firm’s buy-in loan to become an equity partner, she said.
The firm sought to force Craddock to accept a salary reduction, she claimed. Her suit contends firm leaders resisted approval of worthy cases, urged compensation reductions and threatened her employment in retaliation for Craddock opposing gender-based discrimination and filing her EEOC claim.
“LeClairRyan adamantly denies that it discriminated or retaliated against Craddock in any way,” the firm said. “All actions taken by LeClairRyan with respect to Craddock were done for legitimate, non-discriminatory reasons,” the firm’s pleading read.
Craddock filed a class charge of discrimination with the EEOC last February, but her lawsuit filed this month does not seek class action status.
The Equal Employment Opportunity Commission issued a right-to-sue notice last month without making any findings about her allegations, according to Craddock attorney Harris D. Butler III of Richmond.
The right-to-sue letter was followed by the Dec. 11 arbitration demand from LeClairRyan.
Craddock described the demand as a “preemptive strike” aimed at depriving her of a judicial forum. Craddock said she never signed shareholder agreements containing arbitration clauses.
“Given Craddock’s refusal to accept or sign the proposed arbitration agreement, there can be no agreement,” Butler wrote in a brief.
Acknowledging she never signed, the firm nonetheless contended that Craddock expressed intent to be bound by the shareholder agreement and the arbitration clause by accepting her shares and holding herself out as a shareholder.
U.S. District Judge Henry E. Hudson recused himself from the case, citing a conflict. The case was reassigned to Judge Robert E. Payne.
No ruling has been made on Craddock’s request that the federal court halt arbitration.
An American Bar Association task force concluded in 2013 that women lawyers earn significantly less than their male colleagues. The panel’s report said research showed implicit bias – not just family responsibilities – played a significant role in the gender pay gap.
The Greenberg Traurig law firm settled a gender discrimination lawsuit in 2013 for an undisclosed amount while a class status issue was still pending.
A California federal judge recently certified class action status for a suit claiming hundreds of women lawyers suffered pay inequity as staff attorneys for Los Angeles-based Farmers Insurance.