The latest revelation in the Harvey Weinstein scandal seems to show that the Hollywood mogul may have been fired illegally by The Weinstein Company. Why? Because Harvey's contract allowed him to be sued multiple times for sexual harassment as long as he paid for the lawsuits the production company was fine with it.
According to Weinstein's 2015 employment contract basically stipulated that he could be sued for sexual harassment or any other "misconduct" that resulted from a settlement or judgment against TWC as long he repaid the Weinstein Company whatever they were out.
The contract specifically allows for Weinstein's abuse, "treated someone improperly in violation of the company's Code of Conduct," he must reimburse TWC for settlements or judgments. Additionally, "You [Weinstein] will pay the company liquidated damages of $250,000 for the first such instance, $500,000 for the second such instance, $750,000 for the third such instance, and $1,000,000 for each additional instance."
The contract also said that the Board of Directors can fire Weinstein if he is indicted or convicted of a crime, neither which have happened.. yet. The only other stipulation for firing is "the perpetuation by you [Weinstein] of a material fraud against the company." The problem is there is no fraud that has occurred either so Weinstein's firing is looking more and more like it was not legal, in the technical sense of the word only, obviously, his behavior should be punished but in the eyes of the law, the contract is legally binding.
When pressed on the issue, another source said the company had a right to fire Weinstein if he didn't notify the Board of Directors of settlements. But no such settlements have occurred since the signing of the contract. How will The Weinstein Company justify their firing of one of its founders? My guess is we will see formal charges brought against the Hollywood Mogul which would give The Weinstein Company the legal basis they need to make the firing stick.
The New Yorker did an investigative article which uncovered there are three women have claimed Weinstein raped them and the NYPD is looking into an investigation that could bring charges. The article also published a secret recording by a police sting which recorded Weinstein admitting to groping a woman.
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But no such settlements have occurred since the signing of the contract
The Weinstein Company the legal basis they need to make the firing stick