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Backroom Compensation Deals Keep Women Down, Suit Alleges

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By Casey C. Sullivan, Esq. on January 25, 2016 9:58 AM

Despite bringing in $24 million dollars in business and generating nearly $8 million in revenue, former LeClairRyan partner Michele Burke Craddock says her success was devalued and diminished -- not because it wasn't enough, but because Craddock wasn't a man.

Indeed, sometimes credit for her accomplishments was stolen right out from under her, Craddock alleges in a new lawsuit against her former firm. Having started her own practice, she's now suing LeClairRyan, claiming that compensation schemes that were "cloaked in secrecy" discriminated against her as a woman.

Back Office Boys Club

Craddock's suit, which alleges violations of Title VII of the Civil Rights Act, focuses on the "gender-based selective treatment and the adverse gender based impact" of LeClairRyan's compensation and promotion policies.

Despite billing as many hours and bringing in as much revenue as the firm's top male attorneys, Craddock was paid almost half of what similar men made, her suit alleges. That disparity, the lawsuit claims, was largely a result of backroom compensation and governance decisions overseen by former firm chair Gary LeClair and other male firm leaders.

While the firm claims to have a transparent compensation policy, leaked information, Craddock claims, shows a "subjective application of firm compensation policy, including unreported back-office deals favoring the firm's male shareholders, including the subjective origination credits practice."

Eat What You Kill, Unless Someone Else Steals It

Her complaints may seem familiar to some lawyers: having other partners take credit for her work, having her ideas diminished or dismissed, and being passed over for important work.

For example, Craddock claims that she saved a client who had threatened to leave because they disliked a partner. Craddock got them to stay and kept more than $20 million in fees within the firm, but she was was denied both origination credit and a significant bonus. In fact, though the firm collected $4.7 million from her work on that case alone, the firm tried to get Craddock to accept a salary reduction, according to her complaint.

Under the firm's origination system, originating lawyers pick which attorneys to work on the matter. Male partners retain male attorneys, who bill at higher rates, while "the lowest rates are assigned to female attorneys." That leaves women lawyers with more work to do to meet their income goals and less opportunity to originate their own business. That both exacerbates and reinforces gender disparities, according to the suit.

Of course, LeClairRyan denies Craddock's claim. In a public statement, the firm said that it is "proud of the opportunities that women have at the firm," and notes that the firm has been listed as one of the top 100 law firms for women.

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