Posted October 6th, 2011.
Proskauer Rose has been hit with a $10 million gender discrimination suit by its former chief financial officer, Elly Rosenthal, who alleges the firm marginalized her and eventually fired her after she took leave for breast cancer treatment.
In Rosenthal v. Proskauer Rose, 111343-11, filed yesterday in Manhattan Supreme Court, Ms. Rosenthal, 57, accuses the firm, which has more 650 attorneys in 12 offices, of demoting her after her medical leave, denying her pay increases and eventually replacing her with a man who was less qualified, despite her 16 years of excellent performance.
“As the web site of law firm Proskauer Rose proudly proclaims, for more than 70 years the Firm has been ‘synonymous with labor law’—on the side of the country’s ‘largest employers,'” the complaint said. “Unfortunately for Elly Rosenthal, Proskauer’s CFO and one of its longest-serving employees, this management-side experience has served the Firm all too well.”
The complaint also noted that women are “conspicuously absent” from Proskauer’s leadership, comprising less than 15 percent of its partners and almost none of its top administrative positions.
Proskauer hired Ms. Rosenthal, a certified public accountant, as its CFO in 1992, according to the complaint. She had previously worked as director of finance at Stroock & Stroock & Lavan, director of finance and administration at Morrison Cohen and controller at Finley Kumble, according to the complaint.
During Ms. Rosenthal\’s tenure as CFO, Proskauer experienced “unprecedented growth” and earned more than $675 million annually, with profits per partner increasing by 40 percent during her last five years, according to the complaint. She claims she was often praised by supervisors, partners and other administrative employees.
In 2007, Ms. Rosenthal was diagnosed with breast cancer and took medical leave for treatment, including two surgeries. In March 2008, shortly after the end of her treatment, she returned to work, but decided after a few weeks to take another three months of leave to recover.
Before taking leave, Ms. Rosenthal said she asked firm chairman Allen Fagin how the absence might affect her career, but was assured that there “would always be a place” for her at the firm.
During her leave, her supervisor, Chief Operating Officer Arthur T. Gurwitz, told her that the firm would be reorganizing its administrative staff and that she would be given a new position. When she returned, she found she had been put in the newly created position of chief administrative financial officer, in which she was paid less and given less responsibility, her lawsuit claims.
Initially, she agreed to a reduced salary because she was working four days a week, but her salary was never restored when she resumed working five days, according to the complaint. She also said that she did not receive merit raises or bonuses during her remaining time at the firm.
Mr. Gurwitz promoted James Barbaria, Proskauer’s manager of financial analytics, to the post of chief financial officer. Ms. Rosenthal alleges that Mr. Barbaria, who was not a certified public accountant and had not led a financial department, was hired as her subordinate in 2007, and had been trying to undermine her authority. Ms. Rosenthal claims Mr. Gurwitz had ignored her complaints about Mr. Barbaria.
Despite what she called efforts by Mr. Gurwitz and other male administrators to marginalize her, Ms. Rosenthal alleges that she continued to develop ideas to save the firm money, including automated billing and package tracking. These ideas were either ignored or, in one case, credited to a male colleague, she alleges.
In early 2011, Proskauer moved to a new building near Times Square, but Ms. Rosenthal was relegated to a satellite office eight blocks away, according to the complaint. Shortly after the move, she was fired and given three days’ notice to vacate her office. She claims that before the day she was fired, she had never received a negative performance review.
Ms. Rosenthal is seeking $10 million in compensatory and punitive damages, along with attorney’s fees. Her suit asserts claims under New York state and New York City Human Rights Laws, which, unlike the federal Civil Rights Act, do not limit compensatory damages.
David Sanford of Sanford Wittels & Heisler, counsel to Ms. Rosenthal, said that the complaint would likely be amended to ask for back pay and lost future pay in addition to the compensatory and punitive damages.
“Filing this suit was a last resort, not a first resort,” Mr. Sanford said. “We did try to resolve this amicably with Poskauer.”
Proskauer spokesman Josh Epstein did not return a call for comment.