The Frame

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How Harvey Weinstein's 'open secret' was enabled for decades

by John Horn and Monica Bushman | The Frame

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Harvey Weinstein had every employee of his company sign a non-disclosure agreement, which is a violation of federal labor laws. Bryan Bedder/Getty Images for National Geographic

New allegations against film mogul Harvey Weinstein came to light Tuesday in an investigation posted by The New Yorker magazine.

Thirteen women said that Weinstein had sexually harassed or assaulted them, including three women who allege that Weinstein raped them. 

The New Yorker investigation, like The New York Times reporting before it, also highlighted how nondisclosure agreements and confidentiality agreements helped keep Weinstein’s alleged behavior under wraps for so long.

Weinstein’s behavior has often been referred to as an “open secret” in Hollywood. The New Yorker article reported that several executives and assistants at The Weinstein Company were well aware of what was going on and, in some cases, helped to enable it.

In a statement on Tuesday, Weinstein's spokeswoman said: “Any allegations of non-consensual sex are unequivocally denied by Mr. Weinstein. Mr. Weinstein has further confirmed that there were never any acts of retaliation against any women for refusing his advances. He will not be available for further comments, as he is taking the time to focus on his family, on getting counseling and rebuilding his life.”

One senior executive of The Weinstein Company mentioned in The New Yorker story is Irwin Reiter. The story quotes from LinkedIn messages he exchanged with a former employee, Emily Nestor, who was allegedly harassed by Weinstein.

Reiter is bound by The Weinstein Company’s non-disclosure agreement so he is unable to speak openly. His lawyer Debra Katz, a partner in a firm that represents plaintiffs in sexual harassment cases, spoke with John Horn about some of the legal issues around the Weinstein case.

How did Irwin Reiter end up being mentioned in The New Yorker article?

Irwin is executive vice president of accounting and he was thrust into the public domain and in The New Yorker article because one of the women who was sexually harassed by Harvey Weinstein turned over a set of LinkedIn messages between them where Mr. Reiter expressed great concern about her well-being. I can confirm that he did make repeated efforts to get The Weinstein Company to address this serious problems of sexual harassment.

The New Yorker article quotes a message that Reiter sent to Emily Nestor that says, "I fought [Weinstein] " three weeks before the incident with you. I even wrote him an email that got me labeled by him as 'sex police.' The fight I had with him about you was epic. I told him if you were my daughter he would have not made out so well."

That line about [Reiter] being labeled by "sex police" goes to the idea that there is retaliation for people who are reporting on what they believe to be inappropriate or unlawful behavior. There's a penalty. And that's what I think a lot of the actresses and young women who worked either with or near Harvey Weinstein reported, that they were afraid that if they said something there would be a penalty to their careers. Is that something that you think is an issue inside The Weinstein Company and Miramax?

Well, unfortunately, it's an issue everywhere. It's exactly why people don't come forward and don't stick their necks out, because they're afraid of career derailing retaliation. And there's been enough in the public reporting [to indicate] that when people did reject Weinstein's sexual advances, they weren't offered parts. We also know from the reporting that people who objected were given nominal settlements and they were managed out [of the company]. So this is not unique to The Weinstein Company. It's why sexual harassment is so pervasive and continues. When people with less power raise concerns or file complaints against powerful people — people who are perceived to be the rainmakers, the revenue generators, the creative geniuses — they're expendable, but the rainmakers are not.

What can you recommend to the whistleblowers, to the people who see and notice this kind of behavior, they may not be the actual victims but they know that it's happening, like you client? How do you make sure they have the ability to speak out and not lose their jobs because they are willing to take a stand?

Well, you've raised an important issue here. Until people who are not just the targets of harassment are willing to stick their necks out and report what they've seen and support people in the workplace who are being subjected to this kind of harassment, it typically becomes ahe said, she said [situation]. And, typically, HR departments purport to investigate these issues and come up with an inability to substantiate allegations, even in instances where there are recidivist harassers. So it is very important to build a culture where people are told that if you see something, you will not be retaliated against, and you will in fact be rewarded if you report these things in the form of increased esteem with the leadership of your company, your institution. But the tone has to be set at the top.

Harvey Weinstein has said earlier this week that all of these accusations are false. Isn't that de facto saying that these women are lying and isn't that a disparagement?

Yeah, it's a defamation and Harvey Weinstein is going to get himself in far further liability if he defames these women and suggests that they're liars. Because for people whose claims ran 20 and 30 years ago, if he's suggesting that they're lying—  making this up now because they have alcohol problems or mental health problems or whatever — he is going to be stepping from a place of having no legal risk for the actual harassment, but new legal risk for the defamation.

In an essay for the Vox website, University of Chicago assistant law professor Daniel Hemel asked whether the confidentiality agreements that shielded Harvey Weinstein for years should be legal.

In fact, Hemel says, at least one type of confidentiality agreement that’s widely used by employers actually violates federal labor law. But employers often use it anyway, as did the Weinstein Company for every employee. And confidentiality agreements were part of the eight settlements that Weinstein reportedly paid to his apparent victims.

Hemel spoke with John Horn to explain nondisclosure agreements and explore the question of their legality.

What are confidentiality clauses or agreements?

Confidentiality clauses come in two flavors. We have one type of confidentiality clause that an employer will force employees to sign upon the beginning of the contractual relationship [that] all employees need to sign. And that might say something like, as in the Weinstein case, I won't speak publicly or privately in a way that might disparage or damage the reputation of the company or any of its employees.

A second type of confidentiality clause appears in the context of settlement agreements. This is after an employee or ex-employee brings a sexual harassment claim, the employer will say, We'll settle it, we'll give you a monetary payment, as long as you promise not to speak about it.

Can these types of confidential agreements sometimes benefit victims?

There are a few potential benefits. One, the victim might value confidentiality herself or himself. She might not want to be accused of money-grubbing by others, she might not want this to perhaps make a future employer uneasy about hiring her. Another potential benefit to the victim of the confidentiality clause is that usually they're two-sided — so they're going to prevent Weinstein from spreading false stories about his interaction between him and his employee or ex-employee. And third, she might be able to extract a larger payment from Weinstein with a confidentiality clause. So he might say, Hey, I'll pay you $100,000 to walk away, but $1 million to walk away and stay silent about it.

Is there a way to argue that these agreements perpetuate bad, potentially illegal, behavior because they keep the information from getting out?

I think there is a very strong argument for states acting to prohibit these confidentiality clauses in settlement agreements, but to my knowledge no state has passed a blanket prohibition on confidentiality clauses in contracts settling sexual harassment claims.

So confidentiality clauses are legal?

They are generally illegal in the context of blanket waivers when you enter an employment relationship [and agree] not to say anything critical about your employer. The National Labor Relations Board interprets The Wagner Act of 1935 as prohibiting those [except in the case of domestic workers, independent contractors, or supervisors]. The National Labor Relations Board does not interpret the Wagner Act of 1935 as prohibiting confidentiality clauses in settlement agreements.

Is the Harvey Weinstein case evidence that confidentiality agreements are being abused?

I think we had a lot of evidence of the abuse of confidentiality clauses in sexual harassment settlements before the Weinstein case. We saw this in the Fox News case. Fox News used confidentiality clauses to allow Roger Ailes to allegedly continue harassing employees for decades. We saw these in the Herman Cain case that came to light during Cain's presidential bid. So I don't think we've learned anything dramatically new about confidentiality clauses from the Weinstein case, but this underscores just how disturbing these clauses are. And hopefully it will mobilize legislative action at the state level to stop the enforcement of these confidentiality clauses. 

To listen to John Horn's interviews with Daniel Hemel and Debra Katz, click on the player above.

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