Recently fired Paradigm agent Debbee Klein has filed a $2 million lawsuit accusing the talent agency and CEO Sam Gores of, among other things, breach of oral contract and whistleblower retaliation.
The bombshell suit, filed in the Superior Court of California on Wednesday, lands less than two weeks after more than 100 Paradigm employees, including longtime agent Klein, were hit by the company’s “temporary layoffs” amid the coronavirus pandemic. The suit accuses Gores of amassing “vast personal gains by running Paradigm as his personal piggybank” and says he used “Paradigm’s expense account as a slush fund to pay for his sexual dalliances with prostitutes.”
The suit accuses Gores of “tone deaf” handling of the coronavirus pandemic’s effect on the business, saying that he maintained his full salary and kept his personal driver and chef on the payroll even as the agency let scores of longtime employees go — particularly “employees whom Mr. Gores personally felt were being ‘overpaid.'”
“Sam Gores chose to kick these individuals to the curb,” the suit says. “He did so without even offering continued health insurance past April, only to extend this meager offer to June after facing scathing criticism in the press.”
The suit also accuses Gores of “financial mismanagement of Paradigm, especially his disastrous negotiations with United Talent Agency, which singlehandedly torpedoed the planned 2019 merger between the two agencies.” Last June, Gores announced that he had “shut down” talks of a merger with UTA CEO Jeremy Zimmer.
But according to the suit, Gores bungled the merger when he “failed to inform his business partners at X-Ray Touring and Coda Agency, two London-based powerhouse music agencies, about the planned UTA merger” until 48 hours before the deal was set to close. Gores was privately in favor of the $250 million UTA deal, even signing a “document agreeing to the merger subject to certain conditions,” the suit says, but Gores’ partners vetoed the proposal and he subsequently misinformed “the public and Paradigm’s line agents, claiming he made the decision to call off the merger.”
Klein’s suit also accuses Gores of “repugnant and outdated sexism and demeaning treatment of women,” including requiring female employees to listen to his “disgusting and lascivious comments about his sex life.” The 23-year Paradigm veteran also says “less qualified male agents” were promoted ahead of her.
Klein is seeking damages in the amount subject to proof at trial, but that she believes to be in excess of $1.8 million for Paradigm’s alleged breach of contract alone. She is also suing for failure to timely pay wages, for accounting, for breach of the implied covenant of good faith and fair dealing and for retaliation in violation of labor code.
Representatives for Paradigm did not immediately respond to TheWrap’s request for comment on the lawsuit.
Paradigm Talent Agency has “temporarily” laid off more than 100 of at least 600 employees at the agency over the last few weeks, including some senior agents within the movie, TV literature and music departments of the organization. Those who remain at the company have seen a reduction in payroll, all due to the cancellations and shutdowns caused by the COVID-19 outbreak.
In a statement provided to TheWrap on March 25, a spokesperson said that the agency is working on bringing back people as quickly as possible and, in some cases, have already begun to do so.
“The COVID-19 crisis has brought much of the entertainment industry to a virtual standstill, and Paradigm, like many companies, has had to take immediate steps to ensure continuity of our operations,” the statement read. “Last week, we made the extraordinarily difficult decision to temporarily lay off many colleagues and to enact salary cuts across the company. It is our hope and plan to bring these colleagues back as quickly as possible, and today, we have already begun to do so. While it is impossible to know the depth and duration of this crisis, we remain proud of the determination and resilience of our Paradigm team to weather the storm and do our job representing artists.”
Pamela Chelin contributed to this report.