Spitzer Announces Settlement With Wall Street Firms In Major Discrimination Case
Attorney General Spitzer today announced the settlement of a major sex and race discrimination suit against two affiliated Wall Street brokerage houses. The settlement resolves extraordinary charges of sexual harassment and racism at the firms of Garban LLC and Garvin Guy Butler.
"This case should send a strong message to all of Wall Street that we will not tolerate an old boys’ club or frat house atmosphere in the work place. It is wrong, it is discriminatory and it is illegal," said Spitzer.
"The settlement represents an important step toward ensuring that women and minorities are treated equally on Wall Street. In addition, it provides an avenue of compensation for those brokers who were subjected to discrimination."
The lawsuit, brought in New York Supreme Court, alleged that female employees at Garban had often been harassed, with the knowledge and participation of supervisors.
Specifically, the complaint described a work atmosphere in which male brokers made inappropriate sexual remarks to female coworkers, hired strippers to perform at work functions, circulated pornographic magazines and pictures in the office, and entertained clients at strip clubs.
The complaint also alleged that minority employees were subject to racial epithets in the workplace. The suit charged that when employees complained about the harassment, they were often threatened or fired.
The complaint further alleged that female and minority employees were not treated equally in terms of compensation, benefits, and promotional opportunities.
The settlement is unique in that it affords broad relief to current and former brokers whose claims might otherwise be barred by the statute of limitations. Pursuant to the settlement, brokers who were employed by Garban during September, 1996 through September, 1998 are entitled to adjudicate their sex and/or race discrimination and retaliation claims through a dispute resolution procedure, which includes both mediation and arbitration.
The settlement requires that the entire dispute resolution procedure be administered by JAMS/Endispute, a leading national private dispute resolution provider. Claimants who prevail in the dispute resolution procedure are entitled to recover any lost wages and benefits, damages for emotional distress, and attorneys’ fees.
It’s believed that dozens of current and former Garban employees are eligible for the procedure. The dispute resolution process is expected to be completed within a year.
Under the terms of the settlement, Garban has undertaken a variety of personnel policy changes designed to prevent sex and race discrimination in the workplace, including:
- Implementing and posting an extensive non-discrimination policy;
- Establishing an internal and external complaint procedure;
- Providing its employees with extensive and frequent training on bias issues; and
- Modifying existing personnel policies to ensure equal treatment.
For the three-year term of the settlement order, Garban is required to report bias complaints to the Attorney General’s Office and cannot modify any equal opportunity policy without first obtaining approval from the Attorney General.
The settlement also requires Garban to pay the sum of $200,000 to the State for attorneys’ fees and damages.
"We’re very pleased to have brought this case to a successful resolution," said Spitzer. "Not only do we provide a way for past and current employees to be compensated for their hardship, but we will now strictly monitor the company to ensure that it doesn’t allow its employees to repeat any of this reprehensible behavior, now or in the future."
Spitzer commended his predecessor, Attorney General Dennis Vacco, for initiating the case against Garban in 1998.
Assistant Attorneys General Carrie H. Cohen, Lisa Landau, and Tanya Washington worked on this matter under the direction of Civil Rights Bureau Chief Andrew G. Celli, Jr. and Deputy Bureau Chief Mark G. Peters.