First Major #MeToo Lawsuit In Securities Industry Headed to Court

Sara Tirschwell, an investor who had been hired by TCW in 2016 to raise and run a new distressed debt fund for the giant asset-management firm, suddenly found herself without a job on December 14, 2017. She had been called into a meeting with the firm’s chief compliance officer and general counsel and informed that she had unethically told an employee in another department about a potential deal. According to TCW, it was Tirschwell’s fifth violation in 18 months and grounds for termination.

Tirschwell said the firm’s chief executive offered her a $500,000 severance package on the condition that she sign an agreement promising not to sue the firm. Tirschwell did not take the deal because she didn’t think her termination had anything to do with compliance – she claims it was retaliation.

Nine days before this meeting, Tirschwell had sent an email to the head of human resources, saying that her boss, Jess Ravich, had pressured her into having sex with him several times since she started working for the firm and that he had groped her in the office. When she put a stop to it, he allegedly sabotaged her job by refusing to support her fund. The general counsel and head of HR interviewed Tirschwell about her complaint and promised to investigate. Instead, she claims she was fired in retaliation for bringing harassment claims to the attention of management. The company claimed that she knew she was about to be fired for poor performance and simply created grounds to claim retaliation especially given the many holes in her story and gaps in her memory and failure to meet performance and money raising goals.

Tirschwell lost no time, filing her discrimination lawsuit against TCW in January of 2018. Her lawsuit named the firm, Ravich, and the general counsel for gender discrimination, retaliation, and breach of contract. Because the firm’s allegedly false accusations have the potential to ruin Tirschwell’s entire career, her lawsuit is claiming $30 million in damages.

All the defendants deny the allegations and Ravich released a statement saying that, because he had been a seed investor in the distressed fund, sabotaging it would have worked against his own financial interests. He also denies having had any role in firing her.

Although most Wall Street firms tend to settle these kinds of lawsuits fairly quickly, TCW has refused to do so, and more than a year later, the case is still working its way through the court system. According to the firm, Tirschwell was a difficult employee who didn’t perform well, saw that her job was in jeopardy, and filed the sexual harassment complaint before the company could fire her. The firm also claims that Tirschwell and Ravich had known each other since 1994 and had dated for about a year until 2013, three years before she joined TCW.

TCW, like many companies, has a strict policy against intimate relationships between employees and their managers. The firm knew about the history between the two when Tirschwell started working for them, but they both promised to keep things professional. But according to Tirschwell, Ravich had already been pressuring her to have sex with him.

When a reporter from The New York Times interviewed Tirschwell about her relations with Ravich, she was fuzzy on a lot of the details, which is common in instances of sexual harassment and assault – most survivors feel sullied and humiliated by the experience, so they don’t want to remember it. Unfortunately, their inability to remember concrete details often makes them sound unreliable.

While Tirschwell told the reporter she couldn’t remember if she had told anyone about any of her dalliances with Ravich, at least two people remember hearing about it at the time it was happening and that Tirschwell felt that Ravich wouldn’t support her professionally unless she had sex with him.

Tirschwell had been hired to manage the fund on the condition that it reaches $100 million in assets by the end of her first year with the company, a goal that proved ambitious. While she, Ravich, and others at the firm invested millions into the fund, and outside investors added approximately $20 million to the pot, she was still nowhere near reaching the agreed-upon goal and was reportedly looking for other employment opportunities a few months before she was fired. Ravich claims he informed Tirschwell her contract was unlikely to be renewed just a few days before she filed her sexual harassment complaint.

The general counsel, Meredith Jackson, said she was suspicious that Tirschwell didn’t seem to remember any of the details and wondered why she hadn’t said anything earlier until she knew she was about to be fired– excuses commonly used to discredit sexual harassment survivors, even though they are both known common effects of the shame induced by such experiences.

While the case is still in the discovery process, nothing has been said about negotiating a settlement, which means this could very well be the first major #MeToo case from Wall Street to actually go to trial. As big and influential as the movement has been, it has not had many days in court, especially when it comes to Wall Street, which usually prefers to handle these cases in private.

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