Labor / Employment, On The Job, Sexual Harassment

Can Harvey Weinstein Be Successfully Sued? (Part II)

Here's some analysis on one of the first live cases filed against Harvey Weinstein.

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Harvey Weinstein (Photo by Drew Angerer/Getty Images)

“[The Weinstein Company LLC] was aware of Weinstein’s pattern of using his power to coerce and force young actresses to engage in sexual acts with him,” claims actress Dominique Huett in her complaint filed against Harvey Weinstein’s (now former) company, The Weinstein Company. Huett’s lawsuit against the company, filed on October 24 in Los Angeles County Superior Court, alleges one count of negligence and seeks $5 million in damages. You can read the complaint here.

In sum, the complaint alleges that the company (including its board of directors) knew about Weinstein’s alleged conduct “going back to the 1990s,” and that the company “failed to institute corrective measures to protect women from coming into contact with Weinstein.” Ms. Huett also asserts that the company “often aided and abetted Weinstein in the commission of his sexual misconduct . . . [through the use of] ‘honeypots.’”

I wrote last week about whether Weinstein and the company could be successfully sued by individuals claiming Weinstein sexually harassed them. In that article, I discussed the various barriers potential plaintiffs would likely face in bringing such a lawsuit. Now that we have a live case, I thought I’d apply my analysis to the complaint that’s been filed. I’ll first discuss the procedural issues I see, followed by the substantive ones.

Procedural Issues

I think that the lawsuit will stay in state court. The complaint alleges that Ms. Huett resides in New York and that the company has its principal place of business in New York. As currently pleaded, I don’t see complete diversity between the parties required to trigger diversity jurisdiction under 28 U.S.C. § 1332, even though the amount in controversy exceeds the $75,000 minimum for diversity jurisdiction. (And with only one count of negligence pleaded at this point, federal question jurisdiction is unavailable.)

I’m not so sure, however, that the lawsuit will stay in California. I could see the company moving to dismiss the case on the grounds of forum non conveniens. If a suitable alternative forum exists (New York in this case), California courts look at several factors when considering whether a case should be dismissed and re-filed in a different forum.

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The courts consider: (1) where the parties and likely witnesses reside; (2) where evidentiary materials are located; (3) potential burdens on California courts; (4) protecting potential jurors who should not be called on to decide cases in which the local community has little concern; and (5) weighing the competing ties of California and the alternate jurisdiction to the litigation.

Based solely on what’s in the complaint as of today, I think there’s a reasonable chance that the California Superior Court would dismiss the case based on forum non conveniens if the company requests it. Ms. Huett could then re-file the lawsuit in New York.

It’s worth noting briefly that another procedural issue might be whether California or New York substantive law applies. I’m not sure that there is a relevant conflict between the laws of the two states, but, if there is, whichever court winds up with the case may also have to resolve that issue as well.

Substantive Issues

The biggest legal hurdle I see for Ms. Huett right now is overcoming the appropriate statute of limitation for personal injury negligence actions. Assuming the case stays in California, that statute of limitation is two years from the date of the injury under section 335.1 of the California Civil Procedure Code. The complaint alleges that Weinstein assaulted Ms. Huett “in or about November 2010.” California courts generally hold that the statute of limitation begins running at the time of the injury. At first glance, it thus appears that Ms. Huett’s claim was not timely filed by almost five years.

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California courts have, however, recognized an exception to this general rule called the “discovery rule.” The discovery rule prevents the statute of limitation from starting until the plaintiff has reason to at least suspect a factual basis for the elements of her claim. It appears to me that Ms. Huett will try to use the discovery rule to prevent her claim from being barred by the statute of limitations.

Ms. Huett states in her complaint that “she did not discover, and a reasonable and diligent investigation would not have disclosed, that prior to her incident [the company] was aware of numerous allegations of sexual misconduct involving Weinstein.” Ms. Huett alleges that she could not have discovered the company’s role in Weinstein’s purported conduct due to the widespread use of nondisclosure agreements and/or confidential settlements. (Check out Kathryn Rubino’s piece on this topic here.)

Based on these allegations, it appears Ms. Huett may have an argument that her claim did not accrue (and the statute of limitation did not therefore begin running) until recently, when she found out about the company’s alleged knowledge of and role in Weinstein’s purported conduct over the years as reported by various media outlets. If that argument is successful, the lawsuit would presumably have been filed timely.

Conclusion

I believe it will take many months (more likely years) to resolve the factual and legal issues in this lawsuit, assuming it’s not settled prior to resolution on its merits. I’ll continue to provide further updates later in the case as it unfolds.

evan-gibbsEvan Gibbs is an attorney at Troutman Sanders, where he primarily litigates employment cases and handles traditional labor matters. Connect with him on LinkedIn here, or e-mail him here. (The views expressed in this column are his own.)

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