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Bloomberg Dodges Liability for Claims of Sexual Harassment at Namesake Company

Citing Michael Bloomberg’s lack of personal participation in alleged workplace sexual harassment at his namesake company, New York’s highest court on Thursday affirmed a dismissal that keeps the billionaire off the hook for the claims of a fired Bloomberg LP employee who says a supervisor drugged and raped her.

ALBANY, N.Y. (CN) — Citing Michael Bloomberg’s lack of personal participation in alleged workplace sexual harassment at his namesake company, New York’s highest court on Thursday affirmed a dismissal that keeps the billionaire off the hook for the claims of a fired Bloomberg LP employee who says a supervisor drugged and raped her. 

In a 6-1 ruling Thursday, the New York State Court of Appeals interpreted the text of New York City’s Human Rights Law to mean that Bloomberg himself cannot be held personally accountable as an “employer.” 

“The unique provisions of the City HRL provide for broad vicarious liability for employers but that liability does not extend to individual owners, officers, employees, or agents of a business entity,” Judge Michael Garcia wrote in the panel’s 15-page affirmation of an intermediate court’s dismissal of claims against Bloomberg himself. 

The lower court found the unnamed woman behind the lawsuit had failed to allege Bloomberg personally “encouraged, condoned or approved” the alleged sexual harassment and discriminatory behavior by another Bloomberg LP employee.  

Chief Judge Janet DiFiore and Judges Leslie Stein, Eugene Fahey, Rowan Wilson and Paul Feinman joined Garcia in the majority.  

In a scathing dissenting opinion, Judge Jenny Rivera wrote the majority’s ruling is contrary to the definition New York City lawmakers intended the human rights law to employ: a “broad and flexible definition of ‘employer,’ in line with the public policy undergirding the NYCHRL.” 

“Maximizing the accountability of those at the top encourages preemptive action by captains of industry with the means to effectuate broad workplace change,” she wrote in a 30-page dissent rejecting the majority’s narrow interpretation of the law. 

“A proper definition of ‘employer’ would enforce the rule that every workplace— including those controlled by a limited partnership—is subject to the prohibitions of the NYCHRL,” Rivera added. “The NYCHRL holds owners accountable for discrimination and all employees are subject to its protections, regardless of how owners structure their businesses." 

Rivera, who signaled her dissent at oral arguments last month, also wrote, “This misguided approach—predicated on the misapplication of corporate liability to a limited partnership—makes the majority’s willingness to jettison the requirement of liberal construction in favor of discrimination plaintiffs all the more unsupportable.” 

Using the pseudonym Margaret Doe, the unnamed plaintiff said the Bloomberg marketing department hired her just out of college when she was 22.  

Although the main target of her civil complaint was Nicholas Ferris, the global business director of Bloomberg’s Brief Newsletter Division, she also accused the company’s eponymous founder of fostering a hostile work environment. 

According to her complaint, filed in Bronx County Supreme Court in December 2016, Ferris encouraged her to take pain pills while drinking alcohol during a "working dinner” in February 2013. Later that night, he allegedly offered her the guestroom at his Manhattan apartment and raped her while she was incapacitated from the mixture of drugs and alcohol. 

The woman also alleges Ferris caused her to become dependent on drugs he hid throughout the Bloomberg LP office, and that the fear of retaliation kept her from going to human resources.  

In October 2015, she was placed on medical leave following a breakdown and was fired two months later.  

In a phone interview Thursday afternoon, the woman’s attorney, Niall MacGiollabhui, said, “This is a good decision for enablers of discrimination and impunity and a bad one for victims and accountability.  

"Unfortunately, it represents a significant backward step in the development of New York City’s anti-discrimination laws," he added.

A trial court hearing the case initially dismissed the billionaire media magnate from the complaint, finding the claims did not personally involve the CEO as an individual.  

Later, however, the court found that Bloomberg could face repercussions under the New York City Human Rights Law, which holds employers liable for some acts by managers and supervisors.  

Bloomberg later had the claims tossed in a 3-2 decision from an intermediate appeals court, which said the complaint failed “to connect Mr. Bloomberg in any way to the specific discriminatory conduct allegedly committed by Mr. Ferris.” 

Seeking a reversal on appeal to the state’s highest court, MacGiollabhui argued Bloomberg was the majority owner of the company throughout the relevant timeframe, from September 2012 until October 2015. 

Bloomberg’s lack of personal involvement in the alleged harassment or of any direct connection to plaintiff is “immaterial,” the Manhattan-based attorney wrote in a court filing, “particularly, at the pleading stage of the proceedings.” 

MacGiollabhui also noted that Bloomberg was alleged to have been directly involved in addressing gender discrimination issues, both after he resumed his role as CEO in September 2014, following his final term as New York City’s mayor, as well as while serving as mayor. 

During oral arguments last month, Chief Judge DiFiore pressed MacGiollabhui on whether the city’s law could allow Bloomberg to be held vicariously liable.

“So where is the language in the city human rights law that supports the position that corporate shareholders were intended to be held strictly liable as employers for unlawful, discriminatory acts of corporate employees. Where is that?” she asked.  

“It’s not there, your honor,” MacGiollabhui admitted. 

Representatives for Bloomberg did not immediately respond to requests for comment Thursday afternoon. 

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