David Jones Sexual Harrassment Case Settles

By Legal Eagle

I’ve been watching the David Jones sexual harassment case involving former CEO Mark McInnes and former David Jones publicist Kristy Fraser-Kirk with interest, as frequent readers of this blog will know. The case garnered a lot of publicity because Fraser-Kirk’s allegations resulted in McInnes’ resignation, but then Fraser-Kirk proceeded to sue him on a variety of bases (misleading and deceptive conduct, breach of employment contract, breach of duty of care to provide a safe workplace, trespass on the part of McInnes, and a “Claim in Equity” that she was induced to adopt certain assumptions upon which she relied to her detriment). The particularly controversial aspect was her claim for $37M in punitive damages for tort. She also brought an action in the Human Rights and Equal Opportunity Commission for sexual harassment. McInnes publicly admitted he had behaved “in a manner unbecoming of a chief executive to a female staff member”, but denied most of Fraser-Kirk’s allegations.

Yesterday it was reported that David Jones’ and Fraser-Kirk’s lawyers were in furious discussion, and that Fraser-Kirk and her family had emerged smiling from the conciliation; today it was reported that they reached a settlement for a six figure sum (so substantially less than $37M).

Do people think that this case has been positive or negative for women who wish to bring allegations of sexual harassment? I’ve heard a vast spectrum of views, ranging from people who applaud Fraser-Kirk for her courage to people who accuse Fraser-Kirk of inflating her claims to gain as much damages as she can. Do you think it will have a positive impact on workplaces?

Update:

A report in The Age today clarifies many of the details about the settlement, along with the fascinating tidbit that McInnes personally topped up the settlement amount:

Former David Jones chief executive Mark McInnes is believed to have dipped into his own pocket to fund part of the $850,000 payout to Kristy Fraser-Kirk after the store’s directors refused to pay more than the $470,000 court award precedent for sexual harassment.

A spokeswoman for Mr McInnes, who has cashed in 250,000 shares in the company since June, refused to comment when asked about her client’s contribution to the settlement, which is still being finalised.

An expert in workplace law yesterday said he would expect that Ms Fraser-Kirk, after legal expenses, would end up with about $500,000 – considerably less than the $37 million punitive damages she had initially sought.

The junior publicist was suing the department store, its directors and Mr McInnes but at the last minute the store is understood to have reduced its offer even further.

Their view was that, with so much of the detail of the claim in the public domain, there was no need to pay hush money.

Mr McInnes is understood to have stepped in to bolster the settlement at the 11th hour, to prevent the matter from being dragged through the courts.

It is not known if [Fraser-Kirk] will donate any of the settlement to charity. She said at the news conference to launch her claim that any punitive damages would be donated to a charity ”assisting persons in the area of sexual harassment and bullying”.

Neither side has yet made a statement because they are still trying to agree on the small print that largely relates to the confidentiality deal and the amount of detail that can be made public.

It is believed that David Jones wants the deal to be transparent while Ms Fraser-Kirk is keen to keep details of her payout private.

Gerard Phillips, head of Middletons workplace relations lawyers, said: ”I am assuming after Fraser-Kirk has paid legal costs and other costs associated with the case she will probably receive around half a million dollars which, for a sexual harassment case, is not a bad result.

”Obviously if the matter is resolved for significantly less than the $37 million there will be lots of questions about the qualification of the claim in the first place.”

Update 2:

Surprise, surprise, Fraser-Kirk is not going to give her damages to charity.

Update 3:

Sensible piece by Ian McIlwraith on Fraser-Kirk’s lawyers’ strategy FAIL.

30 Comments

  1. PAUL WALTER
    Posted October 18, 2010 at 2:59 pm | Permalink

    Interesting read, the Elizabeth Knight take.

  2. kvd
    Posted October 18, 2010 at 3:04 pm | Permalink

    LE at 49 – not particularly fair because from day one she was reported as intending to pass on a portion of punitive damages, and none were awarded/agreed/settled (whatever correct word is) by the parties. So that specific issue can’t be fairly now held against her I think.

  3. Peter Patton
    Posted October 18, 2010 at 3:06 pm | Permalink

    Yes, I think kvd is correct.

  4. Posted October 18, 2010 at 5:34 pm | Permalink

    re ‘And don’t forget the saucy description of the dessert.’ comment above by PP.

    Maybe the settlement occurred because MM’s defence would ask KFK in the hearing
    “and after he said that, did you then have the f-i-t-m dessert?”

    and the answer was ‘Yes’
    so case over.

    Very recently, a young girl who was genuinely sexually harrassed while working in a Melbourne bistro, killed herself as a result.
    her parents must have been sticking pins in a KFK dolly while tortured by all the PR on this bra-strap frock-vending circus.

  5. Peter Patton
    Posted October 18, 2010 at 6:43 pm | Permalink

    And LE is also completely correct. Personally, I think David Jones itself should’ve had to pay up big time. These corporations really need to be taken to task for their culture of lying at worst, lazy misrepresentations at best.

    The way K-F went about this strategically was never going to win her a lot of fans in Australia, particularly the ‘donate to charity’ right out of the box.

  6. Peter Patton
    Posted October 18, 2010 at 6:48 pm | Permalink

    Ann

    That bistro incident was truly, truly awful. I actually use a different word about it though; sadism.

  7. Peter Patton
    Posted October 18, 2010 at 6:53 pm | Permalink

    Though, I wonder how much the expected $500,000 [net] will cover any downside she experiences professionally going forward? I’d imagine she feels adequately compensated for the ordeal of her harassment and current joblessness [that’s if she is]

  8. Posted October 18, 2010 at 7:09 pm | Permalink

    Has anyone got a linky on the ‘bistro incident?’ Enquiring minds, etc.

  9. Posted October 18, 2010 at 7:42 pm | Permalink

    Christ in a sidecar, that’s the hospitality equivalent of DD causing death. I hope they get the bloody book thrown at them.

  10. Ben R
    Posted October 18, 2010 at 9:03 pm | Permalink

    Came across this blog and thought I’d make a comment on this.

    A little while ago Fraser-Kirk’s claim was published on the Oz’s website. Her claim actually comprised of 2 items, an amount of compensatory damages (which was not specified, and we’ll probably never know what it was) and 5% of profits of DJs in the years McInnes headed it up as punitive damages to be paid to charity (which the media calculated as $37 million). Due to media ignorance and the fact that the phrase “$37 million claim” sells tabloid newspapers, this seems to have erroneously become the fact that Fraser-Kirk was asking for $37 million in compensation. That would have been ridiculous, but that’s not how it was pleaded. Whatever it may have added up to, 5% is a relatively small percentage to ask for in terms of profits of Australia’s largest department store.

    I don’t think it was an abuse of the Court’s time to make the punitive damages claim. It’s fairly novel, yes, but it seems to be the case that major corporations can get away with murder on anything they want to and nothing seems to stop them. A win by Fraser-Kirk with punitive damages would have made corporate Australia very scared indeed (and would probably have prompted changes in the law).

    $850K seems a good payout for someone in Fraser-Kirk’s type of work which I suspect would not pay that much ($50-$100K per year probably). The real winners though are DJs and McInnes – they’ve parted with next to nothing and McInnes probably got paid more than he had to pay to his victim. And who knows what he’ll do next.

  11. Peter Patton
    Posted October 18, 2010 at 9:35 pm | Permalink

    And who knows what he’ll do next.

    Indeed. Perhaps even saucy soup descriptions! [Oh. The inhumanity]

  12. JC
    Posted October 18, 2010 at 10:56 pm | Permalink

    BenR

    Why do you think 5% is not a lot of money to a firm that has shareholders looking to be get a return on their money… mostly they are pension funds accumulating wealth so we can retire.

    Also how do you say it’s erroneous that Kirk was not asking for $37 million? That was her claim against the firm and she proudly announced it so.

    Let me get this straight. You don’t think it was part of her claim because a large portion of the money was going to be directed to charity.

    Okay. Let’s try this on… can you please send $10,000 to the RCH presto. It’s not a claim I’m making against you, because after all it’s for charity.

    I’d like you to get it there over the next few days.

  13. Patrick
    Posted October 19, 2010 at 3:43 am | Permalink

    What JC said, Ben R’s comment was inane. What remotely sane link is there between anything that happened to her and 5% of DJ’s profits?

  14. desipis
    Posted October 19, 2010 at 6:49 am | Permalink

    I’ve never understood why punitive damages go to the plaintiff? Given they are more about damage to the community as a whole rather than directly to the plaintiff, wouldn’t it make more sense for them to go to some third party (trust, government, charity, etc)?

  15. desipis
    Posted October 19, 2010 at 9:13 am | Permalink

    LE, well I have filled out an application to do law next year although I’m a couple of states too far north to attend your classes.

    It’s a hard call as to exactly who gets the money. For me the most direct link would be a trust that supplies legal aid for similar cases and also provides compensation where the defendant is unable to pay. Exactly where to draw the boundaries could be a challenge though. It would also provide a mechanism for balancing the punitive damages by providing a baseline of “demand for funds” to measure damages against.

  16. Posted October 19, 2010 at 1:32 pm | Permalink

    Paul, I’m so sorry to hear about that.

    Apparently a somewhat bizarre study has found that while actually carrying out revenge on their killers may not make you happy, plotting same may be therapeutic.

    http://www.latimes.com/health/la-he-revenge-20101018,0,2305011.story

  17. Posted October 19, 2010 at 1:35 pm | Permalink

    AOD @53: Wha…? Now I think I’ve heard everything. A douchebag makes a creepy remark about your dessert, if you then eat any it disqualifies you from legal action? What does that mean? Eating the dessert is tantamount to consenting to sex? Or if she was able to eat at all she wasn’t upset enough, a la Victorian Heroine template for virtuous womanhood? Maybe I’m misreading what you wrote but I just can’t get my head around this.

  18. PAUL WALTER
    Posted October 19, 2010 at 2:01 pm | Permalink

    Thanks for kind remarks, Helen.
    I wonder myself what I would or could do if the vet’s speculations are correct and any individual was sufficiently identified.
    I suppose it helps thinking on a comment I once heard, concerning sociopaths- these are actually people who appear not to have the choice range that we have. Thinking on it, its a great blessing not to have to do things I’d be ashamed of (well,someof the time, anyway) because my wiring makes me complicit, willingly or unwillingly. What sort of life must it be, where nothing has any value or meaning, no joy bringing substantial interractivity with others such as we enjoy, validated in experience and one becomes just a reactive button-pusher, starved of any experience that we would find sustaining?
    We get pressies at Xmass.
    Is it the gift normal people love, or the underlying affirmation and inclusion it symbolises, for when when it comes down to it, we are all just battlers without road maps, trying to find our way home, as the song says?
    Helen, thank you for your gift, it’s having a powerful, healing affect on me.

  19. Posted October 19, 2010 at 7:07 pm | Permalink

    Thanks Paul!
    You know, if you were to sniff discreetly around the neighbourhood and identify who was doing the poisoning, and dob them in to the cops and the RSPCA both (with a side serve of local and perhaps state level media), it wouldn’t be the kind of revenge-y the L.A.Times article is talking about. It’d save other dogs and cats, too. Do it if you can!

  20. Posted October 19, 2010 at 8:14 pm | Permalink

    LE @59 I have eaten at Cafe Vamp (which has changed its name; surprise, surprise). Appalling behaviour.

    [email protected] That is dreadful: even more so given the connection to your mother. I am actually cat-sitting at a friend’s place at the moment: pets can be a source of great joy.

  21. Posted October 19, 2010 at 8:20 pm | Permalink

    [email protected] Informative link on revenge fantasies. I have had a few myself. This post helps explain why.

    I will now regard them as therapy 🙂

  22. PAUL WALTER
    Posted October 19, 2010 at 11:37 pm | Permalink

    Legal Eagle, a point with Ben’s comment is that it highlights the slippage between
    “David Jones” and “Mark McInnes”. W ho takes ultimate responsiility?
    Is the employer responsible for the individual’s conduct, or the hireling him/her self.
    I think the individual has suffered far worse damage than DJ’s, in the background, incidently (and fair enough ) but as someone else suggested, its interesting how its seems to have been spun out.
    Helen’s nuanced LA Times article on developments in psychology, begs a question.
    Why don’t we get that sort of journalism here?

  23. Peter Patton
    Posted October 20, 2010 at 3:18 am | Permalink

    Paul we DO get that type of journalism *here*. Just click the link and voila! Here is that type of journalism, without having to leave your Jason recliner rocking chair.

  24. PAUL WALTER
    Posted October 20, 2010 at 3:29 am | Permalink

    PP, link isn’t working for me.
    Can you just give me a couple of words to google it up?

  25. Peter Patton
    Posted October 20, 2010 at 3:50 am | Permalink

    Sure

    “Revenge may be all in the anticipation”.

    Los Angeles Times

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