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NEW YORK � A mergers and acquisitions associate at Sullivan & Cromwell has sued the firm alleging a pattern of discrimination against him on the basis of sexual orientation. In a pro se complaint filed Tuesday in Manhattan Supreme Court, Aaron Charney accuses several of the firm’s top partners of discriminating against him because he is gay. He also claims the firm initiated a retaliatory campaign after he filed an internal complaint, culminating in the issuance of a fabricated performance review. In a statement e-mailed Tuesday to all Sullivan & Cromwell lawyers, Chairman H. Rodgin Cohen said the firm categorically denied Charney’s allegations. He said the associate had made similar claims in May 2006, at which time he engaged a lawyer to demand a multimillion-dollar payment from the firm. The firm had investigated Charney’s claims then, said Cohen, and rejected the demand for payment. “Sullivan & Cromwell is widely recognized as welcoming to all persons without regard to sexual orientation,” Cohen concluded. “We are proud of our record of hiring and advancement of individuals irrespective of their sexual orientation, as well as of our lawyers’ representation of organizations and individuals who protect the rights of individuals to be free from sexual orientation discrimination.” Cohen declined further comment Tuesday. In an interview Tuesday, Charney, a fourth-year associate, said he is representing himself because his lawyer had feared the “far-reaching tentacles” of Sullivan & Cromwell, one of the city’s most profitable and prestigious firms. Charney denied demanding a payment though he said his lawyer at the time did attempt to negotiate settlement terms with the firm. The complaint he filed Tuesday does not specify damages. Charney, 28, also said he did not mean to suggest in his suit that all lawyers at the firm were bigoted. Indeed, the suit describes a number of associates and one partner in particular as being sympathetic to Charney’s complaints. But he said Tuesday he believed discriminatory attitudes were perhaps more common in the M&A group in which he worked. “It’s a macho culture that allows people to feel they can get away with these things,” said Charney, a 2003 graduate of Columbia Law School. He claims partner Eric Krautheimer most directly expressed hostility toward him as a gay man, on one occasion allegedly throwing a document at the associate’s feet and making a disparaging comment about physical positions common in homosexual sex. The next day, Krautheimer allegedly made another disparaging remark about gay sex. But most of the allegations in the suit do not describe acts of outright hostility but constant insinuations by partners that Charney was involved in a relationship with another associate, Gera Grinberg. Charney says in his suit that Grinberg is not gay and the two never had a relationship, but he said several partners clearly believed otherwise. He said James Morphy, the M&A group head, told him at his semi-annual review in November 2005 that other partners had complained about seeing Grinberg and Charney eating lunch together and walking together. Morphy allegedly told Charney that “this needs to stop.” Benjamin Stapleton, a member of Sullivan & Cromwell’s management committee, also allegedly complained in a widely circulated document that the two associates worked together “too closely.” Partner Alexandra Korry allegedly told another associate she thought Grinberg and Charney were engaged in an “unnatural relationship.”
‘It’s a macho culture [in the M&A group] that allows people to feel they can get away with these things.’

AARON CHARNEY Sullivan & Cromwell

Charney claims he made an oral complaint in May 2006 to David Harms, the co-head of the firm’s general practice, of which M&A is a subgroup. Harms allegedly took little action but assured Charney he would not face retaliation for complaining about discrimination. But Charney claims Korry asked Harms to fire him, and also had his name deleted from a list of lawyers to be publicly mentioned as having worked on a major deal, the 2006 sale of most of the assets of bankrupt Adelphia Communications. Charney claims retaliation was also the reason he was dropped from a summer associate mentoring program run by Keith Pagnani. Charney also accuses an openly gay M&A partner, John O’Brien, of participating in the alleged retaliation by trying to have the associate assigned to a matter with him. The suit claims O’Brien was trying to “delegitimize” Charney’s discrimination claims and provide Sullivan & Cromwell with a potential defense. Charney claims one partner took his side. M&A partner Stephen Kotran allegedly defended both Charney and Grinberg on a number of occasions and allegedly urged Harms to investigate Charney’s claims more fully. Kotran, who did not return a call for comment Tuesday, also allegedly warned Charney that the firm was retaliating against him over his complaint to Harms. The suit claims the alleged retaliation campaign culminated in a July 2006 performance review given by Morphy and labor and employment partner Theodore Rogers. In that review, the two partners allegedly criticized work performed by Charney on a deal led by Kotran and on which Grinberg was also staffed. The review called the two associates an “M&A group management problem” and said they “run up too many hours when working together.” According to Charney, Kotran again stood up for him and disavowed the review by Morphy and Rogers. He claims Kotran wrote a second review to be submitted to Charney’s personnel file, praising both him and Grinberg as “outstanding” associates whose work had pleased the client. Kotran also allegedly thereafter praised the two associates to a number of clients. Charney, who was out of the office Tuesday but had been planning to return later in the week, said Tuesday he had been contacted by Rogers, who told him he was barred from the office pending further investigation. He said the firm also turned off his Blackberry and disabled his access to the firm’s Web site. The firm has previously been represented by Theodore Wells of Paul, Weiss, Rifkind, Wharton & Garrison. Charney said Tuesday he fully expected to be facing a similarly high-powered opponent, but he said he was confident in his case, much of which he claimed is contained in documents and in voice recordings. “They could bring in 50 lawyers and I’ll just sit there,” he said, “because I’ll have the truth.” Anthony Lin is a reporter with the New York Law Journal, a Recorder affiliate.

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