Wafra Wins Dismissal of Age Discrimination Suit

Paul, Weiss achieved a major victory for investment management firm Wafra Inc. when it secured the dismissal of a $45 million age discrimination case pending in the U.S. District Court for the Southern District of New York.

In May 2018, Wafra terminated Frank Lively, its former head of Real Estate, following a complaint by his direct report that he had sexually harassed and discriminated against her. Wafra conducted an internal investigation and concluded, based on ample documentary and other evidence, that Lively should be terminated for cause for violating its policies and procedures against workplace harassment. After the direct report filed and settled claims against Wafra and Lively, Lively sued Wafra, alleging that Wafra used the harassment complaint as pretext to improperly terminate him on the basis of his age, thereby denying him millions of dollars in unearned salary and carried interest compensation. Lively also alleged that Wafra retaliated against him for supposedly reporting an age-related comment made to him by Wafra’s CEO. Notably, Lively failed even to mention in his complaint the sexual harassment allegations made against him or the investigation that preceded his termination.

Rather than file a Rule 12(b) motion to dismiss, given that such motions are rarely granted in employment discrimination cases, Paul, Weiss filed an answer on behalf of Wafra that described the harassment complaint and investigation, and attached documentary evidence of Lively’s harassment—much of which had been authored by Lively himself. Paul, Weiss then filed a Rule 12(c) motion for judgment on the pleadings.

In his opinion and order, Judge Oetken granted Wafra’s motion for judgment on the pleadings on all claims and denied Lively’s motion to amend his complaint. Judge Oetken considered the evidence attached to Wafra’s answer because it “contradict[ed] the allegations made in Lively’s complaint,” Lively “had notice” of those documents because he authored, sent or received them, and Lively’s “desire to avoid their disclosure may not serve as a means of forestalling th[e] Court’s decision.” Based on the pleadings taken together, Judge Oetken held that the complaint was “devoid of facts plausibly alleging but-for causation” because the only non-conclusory allegation of discrimination, the purported age-related comment, was made six months before Lively was terminated, while the “far more plausible cause of Lively’s termination,” the sexual harassment complaint, immediately preceded Lively’s termination. Judge Oetken also held that Lively failed to plead a causal nexus between his alleged reporting of the age-related comment and his termination, which was fatal to his retaliation claim, and declined to exercise jurisdiction over Lively's state law claims.

The Paul, Weiss team included litigation of counsel Martin Flumenbaum and partner Brette Tannenbaum.