At the prestigious law firm McCarthy Tétrault, a junior partner named Diane LaCalamita watched as less-experienced male attorneys were promoted above her. She complained, got fired, and is now suing the firm for $12 million. Her supporters say the old boys’ club is still preventing women from getting ahead. Her critics dismiss her as a mediocre lawyer who couldn’t hack it in the big leagues. The story behind the case that’s dividing Bay Street
Every weekday evening, when the bell rings and the markets close, dozens of suits from the financial district pour down into Ki, a Japanese restaurant smart enough to be located at King and Bay. Outstretched arms, clad in sombre Canali, eagerly pass corporate credit cards to the bartenders, who then hand back a steady stream of vodka sodas, Jäger shots and goblets of merlot. Bankers, brokers and lawyers come here to mingle and gossip with colleagues and clients. On many nights last year, the most talked-about subject at Ki was Diane LaCalamita’s $12-million gender discrimination suit against McCarthy Tétrault, the fourth largest law firm in the country and one of the storied Bay Street outfits known colloquially as the Seven Sisters. LaCalamita’s story is set out in a statement of claim that stretches 66 pages. The day it became available, it was photocopied and eagerly passed around the financial district like the latest potboiler.
It’s not just the law firms that are fixated, but other institutions, as well—the banks and brokerage houses, the accounting and engineering firms. All have a stake in how the case gets resolved. It’s being watched—nervously or excitedly, depending on your rank and status—on both sides of the border. Never before has a partnership of McCarthys’ size and stature come so close to having its doors blown open and its pay scales and promotion methodology exposed for all the world to see.
Not surprisingly, McCarthys, in its statement of defence, denies LaCalamita’s allegations, which remain unproven, and vaunts its own efforts to promote women in the profession. The firm claims she was simply not up to the job.
On this, Bay Street is divided. For some—mainly men, but some women, too—it’s the story of a bitter, mediocre lawyer who couldn’t cut it among the top-flight litigators at an elite firm. For others—mostly women, but some men, as well—it’s the kind of case that will finally bring to light the subtle forms of discrimination and stereotyping that linger, like some insidious mould, among the offices and boardrooms.
Diane LaCalamita could not have known that she would one day be at the centre of a gender war on Bay Street. She’s the daughter of a pharmacist and a photographer. Her parents taught her not to think along traditional gender lines, and their choice of professions would influence her own decision, 18 years ago, to pursue the burgeoning field of intellectual property law. She attended Havergal College, the elite private school in north Toronto, before pursuing an undergrad degree in life sciences, followed by a law degree at U of T. She was called to the bar in 1992 and earned a master of laws degree from the University of London a year later. She then embarked on a career in a niche area of law.
Through the ’80s and ’90s, IP law was the exclusive domain of a few boutique firms in the city. The emergence of the highly litigious tech industry—including biotech, pharma and life sciences, where patent infringement can lead to lengthy multimillion-dollar lawsuits—was a boon for lawyers.
By 2000 or so, McCarthys and the other Seven Sisters firms were in a hurry to get in on the IP game. LaCalamita, then an associate with Deeth, Williams, Wall, and her fellow boutique lawyers were suddenly in high demand. Bill Richardson, a successful litigator then in his 40s, was one of the senior partners building McCarthys’ IP litigation group. He first met with LaCalamita in 2001, and their personality differences must have been obvious from the start: Richardson is charming and gregarious, an outsize character at the firm; LaCalamita, while friendly and personable, is serious and sometimes quiet to the point of diffidence. Though she was intrigued by the prospect of working at McCarthys, she opted to follow Don Cameron, a former colleague and one of the premier IP practitioners in the city, to the smaller law firm Aird and Berlis. According to LaCalamita, when she declined Richardson’s offer, he told her the door would always be open at McCarthys, and that she should get back in touch in six months, if only to confirm that she’d made the right choice.
A year later, the IP litigation group at McCarthys was starting to take off. It would soon become one of the most profitable departments in the firm, bringing in millions of dollars a year. The group’s focus was pharmaceutical cases—the most lucrative type of litigation in the country—and it had recently landed Merck as a client. Richardson and his co-chair, Andy Reddon, had created a department very much in their likenesses. Richardson was the rainmaker; he spent most of his time out schmoozing with clients and wooing new business. The more cerebral but no less charming Reddon did the heavy lifting, overseeing files along with a junior partner named Steve Mason. The IP crew—especially the handsome duo of Reddon and Mason—were the firm’s golden boys. There were jokes about Reddon’s ability to charm judges during trials. The group was also extremely busy, so they decided to bring in another lawyer to help with the caseload. Through the legal recruitment firm ZSA, they were reconnected with LaCalamita.
For her, the call to join McCarthys came at the perfect time. She was in her late 30s, single, well established in her field and, after 10 years as an associate, in pursuit of a partnership position. Her friends say she was married to her work. She ran a full-service practice, covering a broad range of IP law and litigation—typical of a lawyer from a boutique firm background. LaCalamita welcomed the interest of McCarthys but had several reservations about joining the firm. At the core of her claim is a disagreement over what Richardson and Reddon did or didn’t promise her during the course of negotiations.
LaCalamita claims she made it clear that she wanted to continue the full scope of her IP practice, not just litigation, and that Richardson and Reddon told her she could, though she’d be classified as a litigator in her employment contract (for budgetary reasons). She also wanted a title that was commensurate with her experience, something on par with her future colleagues, and she wanted assurance that if she were to commit to McCarthys for the long-term, she would eventually be made a partner. At the time, she had offers from other firms: Heenan Blaikie, Faskin Martineau DuMoulin, and Ogilvy Renault, where her former IP colleagues at Aird and Berlis had recently moved and where she had been offered income partnership with the possibility of equity partnership within one year. (An income partner is a junior partner—one with the seniority of partnership but without a share in the firm’s profits.) She says she was told that, as a rule, McCarthys didn’t offer equity or income partner status to new hires, but that as a senior lateral hire, she would be given the title of “counsel,” which would not only reflect her experience but also shorten her path to equity partnership—an eventuality that was more or less guaranteed since the board would be relying on their recommendations.
With her experience and expertise in the niche drug regulatory field, LaCalamita expected to play a leading role in managing the firm’s existing pharmaceutical litigation files, as well as broaden the practice into non-pharmaceutical work that would put McCarthys on the map in the IP world. McCarthys offered her a starting salary of $200,000, plus bonuses. The opportunity was too good to refuse. She signed on as counsel on February 17, 2003, and started at the firm on March 10.
All of Bay Street has a stake in how the case gets resolved. Never before has a firm the size and stature of McCarthys come so close to having its doors blown open and its pay scales and promotion methodology exposed for all the world to see
Litigators, at least at the elite firms, are the surgeons of the law profession: they are predominantly male, and they perpetuate a cocky cowboy culture. LaCalamita’s immediate colleagues, though relatively equal to her on paper (Reddon was a couple of years ahead, Mason two years behind), had less technical expertise than her in many of the specialized IP areas the firm was now covering—expertise she claims they made good use of behind the scenes. At the same time, she felt she was being sidelined by what one former employee dubbed the “Andy and Steve road show.” They began excluding her from drug regulatory and biotech files, which had been her specialty. She regularly provided senior level advice on files while also carrying out junior work. She was the only litigator in the group asked to play this type of supporting role.
This did not sit well with LaCalamita, whom one former colleague describes as “quietly mulish.” After a while, when she was asked to do research for her peers, she began to push back in a passive-aggressive way that further alienated her from the guys.
And yet, despite her growing uneasiness about her prospects at the firm, she continued to hold out hope for partnership. She thought an official validation of her seniority would give her some leverage within her department and things would improve. That first summer, she was asked to complete an application for admission to income partnership. LaCalamita had been expecting to skip that step and apply for equity partnership, so she went to Richardson and Reddon for an explanation. She claims they told her she should complete the income partnership application as requested, lest she be considered ungrateful.
LaCalamita submitted her application in October—the same time, she would later learn, that Steve Mason was asked to apply for equity partnership. By January 2004, she was made an income partner, while Mason was made an equity partner. Her salary increased only marginally (in line with that of a six- to nine-year associate on the firm’s compensation grid) and was fixed for the year without a review. Then she saw a group of lateral hires—all men—join the firm. Four of them were admitted as either income or equity partners. It dawned on LaCalamita that her situation might have something to do with the fact that she’s a woman.
Let’s recap, shall we? It’s been about 50 years since women first truly arrived on Bay Street. After those early trailblazers joined the corporate mainstream in the ’60s, young women flooded the universities, got professional degrees and, over the next three decades, followed their fathers into what seemed like exciting and rewarding careers. They became traders and analysts, money managers and accountants, engineers and lawyers. They became doctors and professors and politicians. By the mid-’90s, women constituted nearly half the work force, and as they made their way up through the ranks, they earned the same as their male colleagues (sort of), and they were engaged in the same types of work. Women had finally made it, had come a long way, were doing and having it all.
And then, just when it seemed like they were on course for the corner office, they stalled. A decade or so went by and they remained stuck at the midpoint. Where were all the women executives? Where were the female CEOs and board directors? When it finally occurred to everyone that despite all the change not much had really changed, it fell to those few women sitting in management positions to organize committees and commission reports and launch task forces to try to figure out what the hell was going on.
So now the reports are all in, and the results aren’t pretty. Women make up a mere 17 per cent of leadership positions in the country’s 500 biggest companies. They account for only 14 per cent of corporate boards, 22 per cent of Parliament and 25 per cent of tenured positions in academia. In the legal profession, more than half of all law school graduates are women, yet only 19 per cent are firm partners. Something needed to be done.
Next thing you know, an entire industry dedicated to analyzing and promoting the advancement of women springs to life. A whole lot of meetings are held and entire forests felled in the printing of the results of those meetings. And at this very moment, in banks and investment companies, law firms and law associations and all sorts of consultancies and NGOs, well-intentioned people are working really hard to find ways for companies to “accommodate” women—women who want to have children, women who want more flexibility in their work, women who simply want a fair shot at the C-suite. But in all the talk about the various things holding women back, about maternity leaves and mentorship programs, flex time and work-life balance, there is no mention of what is actually and obviously in the most blinding way the crux of the problem: men.
LaCalamita didn’t have kids and was free to work late and attend to the after-hours client commitments that are part of the job. Still, she felt excluded from the boys’ club that surrounded her
A firm like McCarthys, which is extremely old (155 years) and extremely large (close to 700 lawyers), is a difficult thing to change. And, until recently, the big Bay Street firms were all so focused on nationalizing their companies in order to compete globally that they may not have seen change was a-comin’. As they grew and merged and grew some more, they faced a flood of new associates, many of whom were female and/or non-white. It suddenly seemed hasty, not to mention unprofitable, to make them partners after only five or six years. So they decided to make the path to partnership a little bit longer, say seven to 10 years. Senior associates would now spend a year or two as “income” partners or “counsel,” which meant you could say you were a partner, though you didn’t have a financial stake in the firm or share in the profits; you were just a salaried employee. An employee who really needed to prove herself.
By LaCalamita’s second year at the firm—her first as an income partner—her relationship with Andy Reddon and Steve Mason was deteriorating. She was uncomfortable taking direction from them—especially from Mason, whom she considered her junior. She started complaining to the senior partners about her status within the department and her compensation, and about the ongoing discrepancy between what she thought she’d been hired to do and the work she was actually doing.
In October 2004, she met with Malcolm Mercer, the co-head of the litigation department. Mercer is well regarded at the firm, a fair-minded and empathetic supervisor. He’s also extremely logical—the type of guy who’s hard-wired to think that people will always behave rationally and not resort to backstabbing or other devious behaviour in order to get ahead, even in a hyper-competitive firm like McCarthys. At the meeting, LaCalamita told Mercer that she wanted to “get back on track.” She also told him that she’d been given a commitment with respect to equity partnership, and that she wanted that commitment honoured. She then provided him with names of other lawyers in the extended IP group with whom she’d worked who could vouch for her performance. Mercer told her he would respond to her concerns at her performance review.
At the end of the year, as usual, the firm began its annual review process. LaCalamita, still an income partner, was excluded, apparently due to, among other things, discrepancies in the recording of her docketed hours—a situation she had hoped to address in her review. Though she waited through most of January, neither Mercer nor anyone else in senior management met with her. During that time, her billing rate was raised to $525 an hour—which, it turned out, was $25 less than Steve Mason’s, with whom she thought she’d been in lockstep. When LaCalamita complained, the firm raised her rate to $550, without changing her compensation. Finally, on January 28, she was told she would receive a 17 per cent bonus, a signal that she had hit her billing targets for 2004. The bonus went some way toward acknowledging her contributions and led her to believe she was in good standing after all.
That February, Richardson created a new national life sciences and biotech industry group—an entity that LaCalamita, despite being one of the only lawyers with federal court experience in IP law, was not invited to join. Exasperated, she wrote Mercer to ask about the status of the issues they’d discussed. Soon after, she was called into a meeting with him and Richardson, the tone and nature of which caught her off guard. On the table before Richardson was a memo containing what LaCalamita calls “vague and impressionistic allegations” attacking her character and personality and suggesting that she wasn’t cut out for equity partnership. LaCalamita says that it was the first time she had heard such complaints. She asked Richardson if she could see the memo, but, according to her version of events, he sidestepped the question. She asked if it would be placed in her personnel file, and again he was evasive. She left the meeting stunned.
By the fall of 2005, LaCalamita was feeling desperate and sent a memo to Mercer and Kirby Chown, a female senior partner with the firm. Chown was a 25-year veteran of McCarthys, having started there as an articling student before working her way up to regional managing partner for Ontario. A mother of twin boys, she was regarded as a woman who’d managed to do it all. She was chair of McCarthys’ diversity task force and its women’s committee, and for all appearances was dedicated to promoting women in the firm. She had recently commissioned Catalyst, a non-profit consultancy that advises companies on the retention and advancement of women, to conduct a study into gender issues at the firm. Chown was often trotted out by McCarthys—along with another senior partner, Barbara Boake—whenever the firm needed to show that women can succeed there.
LaCalamita’s memo was thorough. It was part review submission, part application for equity partnership (though none had been requested) and partly an attempt to address the outstanding allegations against her. She provided supporting documents countering the claims regarding her character and performance and outlining her contributions to the firm. (As Mercer would later tell her, it “had the appearance of a pleading.”) She was hoping to set the record straight, or at least provide her side of the story. Chown was her last resort.
For every token female executive, there are thousands of women who have had to resort to all sorts of bizarre and unnatural behaviour in order to succeed.
They met in early November. Chown refused to talk about Mercer’s report and LaCalamita’s response to it. According to LaCalamita, Chown dismissed the correspondence as simply “that lawyer thing we do” and instead steered the conversation to what she called the “human side” of the matter. She told LaCalamita that her future was in the hands of Richardson and Reddon, and that she should do her best to try to win them over. She also suggested that if in her next review with Mercer she got the impression she would not be asked to apply for equity partnership before January 2007, and if by then the “human side” of her situation had not improved, then she should think seriously about her partnership and career goals lest she find herself “batting her head against a wall or door that’s not going to open.” And with that, Chown ended the meeting.
Women leave the legal profession at twice to three times the rate of men. The response of the firms has been, by and large, to empower their female employees to organize themselves into a self-supporting and self-promoting club. In many cases, the men at the company have had little or no involvement, creating a lobby of women mostly talking to themselves—in other words, more balkanization.
Many associates find the initiatives instituted by firms—women’s lunches or other mentoring exercises—to be hollow or, as one woman put it, “glorified referral services” in which the senior partners dole out advice on how to outsource your life: who can tutor your kids or make your dinners or pick up your dry cleaning. One lawyer recalled sitting through one such lunch, after which her colleague turned to her and said, “Great—so who do I pay to fuck my husband?” A former McCarthys lawyer told me that there are senior women at the firm who have two nannies: a day nanny who works from 7 to 5 and a night nanny who works from 5 till 11. “And people say, ‘Look, she’s making it work,’ ” she says. “In my view, the dad who leaves at 5:30 to pick up the kids from school, helps them with their homework, then does his own work from 9 to 11 is making it work far more than the mom with two nannies.”
Even if the women’s lunches were deemed a success as a bonding exercise, their effect on a company was next to nil. Julie Hannaford, a family lawyer who left Borden Ladner Gervais to start her own firm four years ago, says, “The committees started to look like the women’s auxiliary at the church or the ladies’ dining room in the old private men’s clubs. And that eventually evolved into tokenism.”
There are certainly token female executives, trailblazers in their field who found a way onto an otherwise all-male leadership team. But for every token female executive, there are thousands of women who have had to resort to all sorts of bizarre and unnatural behaviour in order to succeed. There are the she-males, those who clawed their way up the corporate ladder, making sacrifices along the way, and are now coaching their young female underlings on how to behave more like men. The perception among the younger generation is that these women had to work so hard to get to where they are that they’ve become blind to the fact that their struggle was unfair to begin with.
Other mid-level and senior women resort to pandering or other disingenuous tactics in order to get to a senior position. “You have to be perky and a cheerleader and do everything they say,” one lawyer told me. “And if they suggest you should be researching down a particular line, you do it even when you know it’s counterproductive.” At the junior and mid-level, you’ll find the handmaidens—women who, thanks to a perverse twist on male mentorship, become the perennial junior to some great man and never reach their potential. The handmaiden problem is endemic to big firms, where women are often perceived as detail oriented and not able to grasp the big picture. They’re great as juniors when they’re still cheap and can put in lots of hours. As they progress, they become too expensive to do the tedious work, and yet the senior guys don’t want to introduce them to clients or give them big files or bring them in on important meetings. “So that’s where you see all the women leaving,” one senior partner tells me. “Everybody thinks they’re great the first three years, then their billing rate creeps up and clients start to complain and so there’s no more work for them to do because no one wants to turn them into really good corporate lawyers.”
And then there are the misunderstood media darlings known as the Opt-Outs. The Opt-Outs take great pains to tell you that they left their practice or their position because they wanted to, not because they couldn’t hack it. Most of them have children and are married to other professionals. You can’t talk about how to keep women in big jobs without seguing into the subject of maternity leaves. The two seem intertwined. Even childless women acknowledge that the hint of a notion of a possibility that a woman may one day bear children affects the way she is perceived within a company. If she does have a baby, reaction ranges from the relatively innocent impulse to not overburden the new and obviously busy working mom, to the more damaging conclusion that she’s no longer up to the job. A lot of women feel that companies are putting too much emphasis on the importance of maternity leaves, which gives employees the false impression that the lack of women in top jobs is being addressed, and has the uncomfortable side effect of positioning women as primarily reproductive and therefore less committed to their careers.
Firms are cliquey by nature, and partners will simply give work to the lawyers they like. One young associate, a refugee from a Seven Sisters firm, saw the cliquishness devolve into outright discrimination when she asked to be put on a high-profile case. She was told that the client wanted someone more senior. An hour later, she was back in her office when an associate of the same rank came in complaining that he had too much work, having just been handed the file she’d asked for. “When it came down to really high-profile work,” she says, “they didn’t want a female associate on it.” She went to her contact in HR to talk about the incident, only to be told that she was imagining men were being favoured. So she left the firm.
Though most women will say that any attempt by their company to address gender issues is better than none, few think their firms understand the profoundly pro-male structures that govern their institutions. It’s particularly challenging for women in the middle ranks, where there’s a lot of politics and jockeying for position. Few managers are adept at handling and recognizing the personality issues and different work and leadership styles of their employees—all the nuances and complexities of the modern and ultra-competitive workplace. The much simpler solution, it seems, is to ask women to organize mentoring programs and networking events for themselves—as if they didn’t have enough work already.
In January 2006, LaCalamita had her long-awaited review with Mercer. To her surprise, he told her that he had no intention of discussing her October memo. Instead, he was only prepared to talk about two things that day: first, that LaCalamita had no future in pharmaceutical litigation at the firm, and second, that she should focus instead on building a drug regulatory practice. LaCalamita must have found this galling, since she’d started out with a drug regulatory practice, and rebuilding one would take another four or five years. Mercer also confirmed that he would not be considering her for equity partner that year.
LaCalamita hovered in a kind of limbo, haunting the office despite not having much in the way of work. No one would talk to her, and none of her colleagues outside the small litigation group knew what was going on. Finally, the standoff was broken when McCarthys handed her a letter of termination
And so began the long, drawn-out war of attrition that’s waged when a firm refuses to fire someone it no longer wants and that someone refuses to leave. LaCalamita hovered in a kind of limbo, haunting the office despite not having much in the way of work. No one would speak to her, and none of her colleagues outside the small litigation team knew what was going on. Finally, on April 25, the standoff was broken when McCarthys handed her a letter stating that her employment would be terminated at the end of June.
But it wasn’t over yet. Summer stretched into fall and fall into winter as LaCalamita tried to negotiate a better settlement package. The two sides eventually hired a mediator, to no avail. Finally, she decided to sue.
This isn’t the first time McCarthys has been accused of sidelining its female lawyers. The Catalyst report prepared for Kirby Chown and McCarthys back in 2004 evaluated firm data from 1999 to 2003 and spoke with lawyers there at all levels. The report stated that, among other things, women voluntarily exited the firm at twice the rate of men; that male income partners were admitted to equity partnership at twice the rate of their female counterparts; and that over those four years, only male lateral hires were admitted directly into equity partnership. Qualitatively, the report found that while many lawyers believed the firm environment was characterized by great people and great work, a majority of women felt marginalized by subtle stereotypes, that they perceived “male” and “female” types of work, and that they felt excluded by “boys’ clubs.” More generally, it revealed that employees found the criteria for admission to partnership unclear. The report concluded by commending McCarthy Tétrault for being among the first elite law firms to recognize gender diversity as a business issue, something that could help the firm gain a competitive advantage. It advised that change would come only from a steady, measured approach—a common refrain among advocates for women’s advancement.
A couple of years later, McCarthys’ women’s task force, headed by Chown, completed an internal study following the assessments in the Catalyst report. It found that in 2006, although women made up 51 per cent of the senior associates at the firm, they comprised only 29 per cent of income partners, 18 per cent of equity partners and 15 per cent of the leadership roles.
In McCarthys’ statement of defence in the LaCalamita case, the firm insists there is no culture of discrimination. McCarthys says it only ever offered her a position as a litigator, that it has strict selection criteria for partnership admission, and that LaCalamita simply failed to meet them. She was unable to meet deadlines and the minimum expectation for billable hours, the company maintains, and she showed poor judgment as a litigator, to the point that her colleagues “didn’t trust her instincts.” When McCarthys attempted to help her by offering her professional coaching for performance issues, she declined. The statement of defence also notes that LaCalamita never complained of discrimination of any kind while she was employed there, “despite being aware of the formal complaints process in place to address such allegations.” It says that LaCalamita was one of the highest paid income partners at the firm, and yet her billable contributions were among the lowest. The retention of women in senior positions is a profession-wide challenge, McCarthys insists, and it points to the Catalyst report as evidence of the firm’s efforts to promote talented female lawyers.
Joy Casey knows first-hand what Diane LaCalamita is going through. She sued her former employer, Blake Cassels and Graydon, in 1998 for $1.1 million. Hers was the first gender discrimination lawsuit brought against a Seven Sisters firm. The case was settled in 2003, and although the terms of the settlement are confidential, the claim was essentially the same as LaCalamita’s: it was based on denial of partnership and an alleged misrepresentation of partnership prospects. She acted for herself in the suit and has since represented another female plaintiff who was denied partnership at one of the major firms—a suit that was settled quickly and quietly. “Everyone tells you not to sue, that it will affect your reputation and that you’ll never get hired by a big firm again,” she says. “But litigation makes people sit up and take notice.” Casey now runs her own commercial litigation and employment law practice, and recently launched an organization called A Call to Action Canada, which encourages corporate in-house counsel to push for more diversity in their supplier law firms.
Groups like Casey’s walk a fine line: they must court the male execs at the big firms, encourage participation and gently nudge them toward a new way of doing things. For their part, the execs have to be prepared to admit to real systemic problems. The irony for McCarthys is that in its attempt to address gender issues through the Catalyst study, the firm left itself vulnerable to the type of lawsuit it’s now fighting.
LaCalamita is being represented by Malcolm MacKillop, an employment lawyer at a boutique labour firm, and Mary Eberts, a well-known equality lawyer who started the women and law course at U of T. McCarthys is represented by a 60-something commercial litigator named Terrence O’Sullivan. The two sides expect to go to trial in the next year. That is, of course, unless they reach a settlement. They have to be working hard at it. No one at the firm wants the confidential compensation and billing information they were recently forced to produce to be exposed at trial. Then again, LaCalamita may decide to hold out, roll the dice and see what the court has to say.
At the moment, she’s also trying to get a job. According to friends, she’s living with her parents and recently wrote the British bar exams in the hope that she might find work overseas. She figures she’ll never be hired in this town again.