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The Gay Flannel Suit

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A day or so later, John O’Brien, a gay partner in the M&A group, offered Charney a way out of the mess, telling him, “It’s time we work together.” It was one way to defuse the situation, by getting off the deal he and Grinberg were working on (Kodak’s quest to unload its health-care imaging unit) and onto another project. But Charney smelled a rat. “They were trying to move the chess pieces and lay the groundwork to get rid of me,” he says. “He could write me a bad review and then they could flip it around by saying, ‘It can’t be discrimination because a gay partner is saying bad things about a gay associate.’ ”

On May 10, he got another lifeline. Charney says David Harms walked into his office at 5 p.m. and said that although Krautheimer and Korry had denied everything, Harms had made it clear to them that any bad behavior should stop. If Charney considered the matter resolved and didn’t press his complaint further, he’d have no problems going forward: “You will have no retaliation,” he said. Charney was relieved: “I went home that night thrilled.”

But the next day, he claims, the firm’s machinery started gearing up against him. Charney was shocked to discover that he hadn’t been included on the list of associates who would mentor the incoming class of summer associates. Some say it’s laughable to take offense at this. “I was well regarded over there, and I wasn’t picked as a summer mentor for a couple of years,” says one lawyer. “It’s completely random.” But Charney had spent the last two years zealously recruiting for the firm at law schools; now he felt he was being singled out as a problem child. “Someone who you wanted as the face of the firm—and now you’re removing me from any involvement in any activity in the firm?” he says.

That same day, Charney learned that his discrimination claim was the talk of the department. Steve Kotran, his supervisor on the Kodak deal, allegedly told him that several partners had asked if Charney and Grinberg were sleeping together; some even accused Kotran of enabling the relationship by assigning them to the same deals. There are those who believe Kotran would warn Charney this way; he was known for looking out for younger employees. When Charney went to Harms to complain about the mentor list, Harms reiterated that he should drop his complaint, “let bygones be bygones,” and “move on.” According to Charney, he meant this literally, suggesting a relocation to one of Sullivan & Cromwell’s foreign offices. To Charney, this was the bolt slamming shut on the now-closed door of the firm.

Charney hired a lawyer, and that lawyer, according to a knowledgeable source, suggested a $5 million settlement in a phone call that was promptly reported to the firm’s management committee and then turned down. To this, Charney issues only a partial denial: “There was never anything written to them asking for money,” he says, adding that he fired that lawyer soon after.

Then came the dénouement: On July 6, Charney claims, he had a scathing semi-annual review. He suspected, based on a conversation with Kotran, that the firm was preparing a defense against his discrimination claim that painted Charney as a “management problem.” And here was the beginning of the paper trail. The report claimed that Charney and Grinberg were “running up too many hours when working together,” and “are only willing to be staffed on transactions if they can come on as a packaged deal.” Their “joint-work approach,” the report continued, protects them from blame for any bad work they might do. Charney’s closeness to Grinberg, they said, could be grounds to “drive them out of the firm.” (Grinberg is currently on paid leave.)

Charney decided to file a lawsuit. He started drafting the complaint before Thanksgiving but wanted to wait until the Kodak deal closed before taking action. When the deal was finally done, on January 15, he hadn’t slept in four days. The next day, he filed his complaint with the state court. “My focus was on putting together a document that makes very clear what happened,” he says. “I never spent much time opining about what would happen the day after.”

That seems a bit disingenuous, since he was calculating enough to send copies of the complaint to blogs like Greedy Associates and Above the Law, and Gawker too, ensuring that every lawyer in town could download and dish about it. In fact, it’s striking how far out of his way Charney went to expose everyone involved to public view—even his friends. He named Grinberg in his complaint, when he might easily have redacted his name or called him, say, Associate A. He included an e-mail from Kotran, another purported ally, in which he impolitically says that billing complaints by Kodak are “par for the course.” Charney even included the firm’s partnership agreement in the appendix, a confidential document that reveals, among other things, how much the partners earn after retirement ($255,000 a year).


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