The New Yorker has a fascinating new article by Ronan Farrow providing more information about some of the settlement structures used by Harvey Weinstein and his company. It is worth reading in full, but I’m including a few excerpts from the article below to give you a sense of the piece.
The short version is that in the hands of the rich and powerful, settlements can be an incredibly destructive tool — exactly in the way that Fiss described more than thirty years ago. Secret settlements of the kind that Weinstein used for years highlight the potential and substantial downsides of settlement coming from power imbalances, the lack of informed/authoritative consent, the inherent difficulties (impossibilities?) of monitoring future behavior, and the apparent prioritization of peace (by way of resolving a discrete complaint) over justice.
The story starts with Ana Gutierrez, the woman who went to the police after being groped by Weinstein. Gutierrez’s case was ultimately dropped by the district attorney.
Gutierrez said that the decision not to press charges shocked her. “We had so much proof of everything,” she recalled. “Everyone was telling me, ‘Congratulations, we stopped a monster.’ ” She began to worry about her future. “I couldn’t sleep, I couldn’t eat,” she told me. New York tabloids, including the New York Post, to which Weinstein had fed stories in the past, had been publishing lurid reports about Gutierrez that mirrored the information in K2 [a private investigation firm]’s dossier. “What did I do wrong?” Gutierrez said. “The only thing I did was exposing something bad that happened to me.”
Gutierrez spoke with attorneys, who advised her to settle. She felt “pressured” to do so and initially refused, but given that she could not take on Weinstein herself (no support from the authorities, no power/money, disparaging publicity, etc.), in 2015 she signed a settlement agreement. The non-disclosure provisions on the settlement were extensive.
Gutierrez’s settlement … bears Weinstein’s signature and orders the destruction of all copies of audio recordings of Weinstein admitting to the groping. Gutierrez agreed to give her phone and any other devices that might have contained copies of the recording to Kroll, another private-security firm retained by Weinstein. She also agreed to surrender the passwords to her e-mail account and other forms of digital communication that could have been used to spirit out copies. A sworn statement, pre-signed by Gutierrez, is attached to the agreement, to be released in the event of any breach. It states that the behavior Weinstein admits to in the audio tape never happened. “The Weinstein confidentiality agreement is perhaps the most usurious one I have seen in decades of practice,” an attorney familiar with the agreement told me.
Next, Farrow tells the settlement story of Weinstein’s former assistant, Zelda Perkins. Perkins settled with Weinstein twenty years ago and has only now started talking about the process and the substance of that agreement. Regarding the process, Perkins and her assistant (who had also been assaulted by Weinstein) first consulted with lawyers about her options.
Perkins and the assistant hired lawyers from the London-based firm Simons Muirhead & Burton. Perkins said that, in hindsight, the attorneys seemed intent on foreclosing any outcome except a settlement. The lawyers told the women that because neither had gone to the police immediately after the incident, reporting the attack at that time was “very clearly not an option.” Perkins said that she asked about reporting the incidents to Michael Eisner, the C.E.O. of Disney, which at the time owned Miramax, because she knew that Weinstein’s relationship with Eisner was under strain. The lawyers dissuaded her from that, too. “They just said, ‘No way. Disney will crush you. Miramax will crush you. They will drag you, your family, your friends, your pets through the mud and show that you are unreliable, insane. Whatever they need to do to silence you.’ ” Perkins said that she felt trapped. “I was, like, ‘Right. O.K. So, we can’t go to police because it’s too late. We can’t go to Disney ’cause they don’t give a shit. So who do we tell? Where’s the grownup? Where’s the law?’ ”
Ultimately Perkins settled. Not only did she have to sign an NDA, but anyone who might have found out about the settlement (lawyers, accountants, therapists) also had to sign one. In addition, under the agreement, she was not allowed to keep her own full copy of the settlement, so she has been piecing it together as she can.
These contract provisions sound draconian, but according to the article, this level of secrecy is typical for Weinstein, whose employees were forbidden under the NDAs in their employment contracts to talk about any of Weinstein’s “personal, social, or business activities.” Even business partners were subject to the same extensive restrictions in their contracts with Weinstein. Such far-reaching confidentiality provisions serve to stymie those who worked with Weinstein from sharing information about dysfunctional behavior.
Perkins tried to build some creative options into her settlement agreement that addressed her interests in protecting others from harassment.
The agreement mandated the appointment of three “handlers,” one an attorney, to respond to sexual-harassment allegations at Miramax. Miramax was obligated to provide proof that Weinstein was receiving counselling for three years or “as long as his therapist deems necessary.” Perkins had to approve the therapist and attend the first session. The agreement also required Miramax to report Weinstein’s behavior to Disney and fire him if a subsequent sexual-harassment settlement was reached in the following two years.
But Miramax, Perkins said, “stalled and stalled and stalled.” The company implemented the human-resources changes, but other parts of the agreement were not enforced. She pressed for months, then gave up. “I was exhausted. I was humiliated. I couldn’t work in the industry in the U.K. because the stories that were going around about what had happened made it impossible,” she said. In the end, Perkins moved to Central America. “I’d had enough,” she said.
Secret settlement creates moral hazards and ethical problems, but are legal. That said, there have been calls for reform.
[Professor] Estreicher has proposed that the Equal Employment Opportunity Commission, the government body that oversees workplace discrimination, track sexual-misconduct-related settlements and investigate employers who use them repeatedly. In addition to Congresswoman Jackie Speier’s legislation regarding congressional employees, state lawmakers in New York and California are pushing legislation to curtail the use of nondisclosure agreements in sexual-abuse cases.
Allred noted that these reforms could “limit victims’ options.” Certainly true — but when does the principle of self-determination yield to the needs of society? And how well can we assess options without fuller information?
Gutierrez, Perkins, and other women who signed agreements with Weinstein told me that they felt their consent was far from informed. Gutierrez said that she wished she had been aware that Weinstein had faced similar allegations in the past. When, after the fact, she learned that his behavior with her was part of a pattern, she was filled with guilt.
One takeaway from the article is that it’s hard to exercise your self-determination in a vacuum — what you want, vis-a-vis settlement, may be shaped by context in ways that the current settlement regime does not appreciate.