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Scapegoat Lawsuit Risk: What It Is And How To Avoid It

By Jack McCalmon, The McCalmon Group, Inc.

Francisco Cortes, a former vice president at Fox News Latino, filed a lawsuit in a New York federal court, alleging he was scapegoated. Cortes is suing for breach of contract, fraudulent misrepresentation, conspiracy to defraud, tortious interference, and defamation. He seeks $12 million in compensatory damages and $36 million in punitive damages.

The lawsuit's origin stems from a $2.5 million settlement with Tamara Holder to resolve her sexual harassment charges against Cortes.  Oddly, Holder and Fox delivered a joint statement to The New York Times about the settlement, which Cortes alleges killed his reputation while bolstering Fox News' public message that it was "turning over a new leaf" since the recent wave of sexual harassment charges filed against the network.

Cortes also alleges he did not receive the same settlement as other personalities at Fox News, perhaps because he is Latino. Eriq Gardner "Fox Hit With 48M Lawsuit for Allegedly Scapegoating Executive In Sexual Harassment Scandal," hollywoodreporter.com (Jul. 25, 2017).

The lynchpin of Cortes' lawsuit is his allegation that Fox orchestrated his ouster with the investigating law firm, Paul Weiss.

Employers who are the subject of sexual harassment charges have an obligation to investigate the charges of sexual harassment in a timely, professional, and objective manner. Investigations, especially complicated ones, can take weeks to perform. Sometimes the findings are inconclusive.

Third-party investigations, like the one conducted by Paul Weiss, are an important tool for an employer confronted with sexual harassment charges, especially when the allegation is that a hostile work environment culture exists. The role of the investigator is to discover the facts, filter out the hyperbole, and presents the information Dragnet-style (facts only) to the employer and its agents.

A best practice is for an employer to hire a third-party investigator, usually a lawyer, whose job is to interview the complainant, witnesses, and the accused, as well as to gather documentation. This lawyer is not hired to provide legal counsel to the employer, but simply to find facts. Lawyers with the right communication skills know what questions to ask and information to gather, based on their knowledge of the law and evidence rules. Most employers do not use their own attorneys to perform the investigation because whoever investigates will have to testify in any resulting trial as to the methods and results of the investigation, creating a conflict of interest and, possibly, preventing them from acting as trial counsel.

The investigator should present a written investigation report containing the facts to the employer. The employer should review the factual findings with its legal counsel to determine an appropriate response. Those conversations, leading up to a decision, can be subject to the attorney-client privilege.

It is important keep fact-finding separate from decision-making. The charges by Cortes exemplify the risk of not doing this. The apparent conflict of interest permits allegations that the "fix was in" and that the goal of the Fox investigation was not to discover the facts, but rather to just protect the employer.

Backlash tort claims often result based on allegations the investigation was not objective, but was instead "steered" to make the accused a "patsy" or a "scapegoat".

Charges of sexual harassment, especially from multiple sources, carry exposure of great magnitude for employers, not only by accusers but also by the accused as well. The best defense to both risks is to create a wall between whoever performs the investigation and those who will make the decision on how to move forward once the facts are known.

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