2 dads say teachers at a New York school blamed their gay son for the ‘horrific’ homophobic bullying he endured and now they are suing for ‘justice’

Jason Cianciotto and his son (pixelated)
Jason Cianciotto, pictured, began the foster-to-adopt process in 2017.

  • A gay couple said New York school failed to deal with the homophobic bullying their son endured.
  • Their child was repeatedly called homophobic slurs and physically attacked, his father told Insider.
  • Jason Cianciotto, one of the child’s fathers, is accusing the school of breaking New York’s anti-bullying laws.
  • See more stories on Insider’s business page.

When Jason Cianciotto and his husband signed up their newly adopted son for the Albert Shanker School for the Visual Performing Arts, they thought it seemed like the perfect fit for him.

“Shortly after coming home with us, he came out to us as gay,” Cianciotto told Insider. “So we thought that there was also a good chance that a school that focused on the performing arts might also have other students who were out or, at the very least, it would be a safe and welcoming environment for kids like my son.”

They were mistaken.

What followed, Cianciatto said, was two “horrific” years of homophobic bullying and physical attacks by students and victim-blaming from senior staff at the school.

Now, Cianciotto, who is the senior managing director at a global non-profit, and his husband are seeking “justice” by suing the New York City Department of Education (DoE), the Board of Education (BoE) for New York City Public Schools, and several employees at the school their adopted son attended between 2017 and 2019.

‘His dream of being adopted… was finally coming true’

Cianciotto and his husband began the foster-to-adopt process with their son, who will be referred to as “Daniel,” to protect his privacy in 2017.

Daniel had a troubled start to life, according to legal documents seen by Insider. His biological parents were addicted to drugs and alcohol, and domestic abuse was commonplace in their home. He was placed into the child protection system at 7-years-old.

Read more: Trans women say Instagram removed their Pride month posts over false hate speech reports

Daniel struggled with diagnoses of PTSD, Generalised Anxiety Disorder, and epilepsy, as well as several learning disabilities resulting from a brain tumor, and was repeatedly abandoned by foster parents.

But when Cianciotto and his husband, who asked not to be named, came along, things started to look up for the 11-year-old boy.

“His dream of being adopted and having a forever family and, on top of that, having a family of two dads that were so welcoming and accepting of him was finally coming true,” Cianciotto said.

Daniel’s new parents deliberated over which school to send him to, hoping to find an environment that he could “learn and grow… free from fear and abuse.” They chose to enroll him in sixth grade at Intermediate School 126 (I.S. 126), better known as the Albert Shanker School for Visual and Performing Arts, in Long Island City in September 2017.

Daniel was blamed for bringing the homophobic abuse on himself

Cianciotto said the school was a “hostile and dangerous environment” for their son from the get-go. “He came out to his classmates and teachers shortly after the school year began, and right away the bullying, harassment based on his sexual orientation, and perceived gender identity began,” he added.

A 45-page lawsuit filed in a New York district court cites many examples of homophobic abuse directed at Daniel while at the Long Island City public school.

He was allegedly called several homophobic slurs, including “faggot ass,” “gay boy,” and “pussy dick sucking face.” He was ridiculed and was told that he was “damned to hell by God because of his lifestyle,” the complaint continued.

He was also physically assaulted on several occasions, according to Cianciotto.

Read more: 5 LA preschool consultants to know to get your child into a prestigious program

The bullying had a profound impact on Daniel’s mental health, his father added.

“He started, for example, self-harming behavior, where he would bite himself, he would hit his head with his hand or hit his hand against a desk or a locker at school. He would poke his fingers in his eyes,” he said. “Eventually, that self-harming turned into saying that he wanted to die by suicide.”

The parents tried to speak to the school about the bullying but a meeting with the sixth-grade dean allegedly resulted in Daniel being blamed for bringing the homophobic abuse on himself.

“We were shocked and horrified to hear her say that talking about homosexuality in middle school is not appropriate and that if my son just stopped talking about his sexual orientation or that he was getting adopted by two gay dads, then it wouldn’t be a problem,” Cianciotto said.

‘They accused him of fabricating the harassment’

Daniel and his parents alerted school administrators to the homophobic bullying but, according to the complaint, the school staff repeatedly flouted their legal obligation to document and investigate several reports of harassment.

Under New York State’s Dignity for All Students Act, the Board of Education mandates that school employees who witness or learn about harassment, bullying, or discrimination must report it to administrators. If “substantiated,” these reports must then be investigated and appropriate action must be taken to remedy them.

Cianciotto said that the school found excuses not to investigate several incidents of bullying and discrimination.

“They accused him of fabricating the harassment, blamed him for bringing the bullying on himself by being open about his sexuality, and excused his bullies’ pronouncements that LGBT people are destined to burn in hell as a mere ‘difference of opinion’ that [Daniel] should learn to respect,” the complaint reads.

“There’s a very clear difference between helping young people learn and understand and respect various religious beliefs and traditions and allowing there to be religious-based bullying and harassment,” Cianciotto added.

Albert Shanker School in New York
The Albert Shanker School for Visual and Performing Arts in Long island City, New York was a “dangerous and hostile” environment, according to Jason Cianciotto.

Another incident, in which Daniel was called a homophobic slur, wasn’t considered substantiated enough to be investigated because it was decided that a student knew no better, according to the complaint.

“Even though it was confirmed that a student called him a faggot, the dean investigating it said that it wasn’t actually a bias incident because the students who said it didn’t have the contextual understanding to go to know what that meant,” Cianciatto said.

The father told Insider that other homophobic attacks were overlooked because teachers claimed they could not corroborate the information.

‘We needed to find a safer school for him’

In May 2019, an incident was deemed to be substantial enough for the school to log. Daniel received notes in class. One called him a “gay bitch,” and the other said: “Because you don’t love Jesus your [sic] an asshole . . . you [sic] going to hell you white idiot.”

A dean notified Cianciotto of the incident by email. However, according to the complaint, the school took no action beyond sending letters to the parents of all those involved.

On May 22, 2019. Cianciotto and his husband arranged to speak to the school principal, Alexander Enguiera, who turned down Insider’s recent request for an interview. In a meeting also attended by the assistant principal and the seventh-grade dean, Daniel’s parents said they were left deeply disappointed.

Read more: As a teacher, I see the Republican Florida law requiring students and staff to expose their political beliefs as a gross government overreach

“Not only did they say that they couldn’t put him in a different class or reasonably ensure that the bullying would stop, they also confronted me, saying that the parents of kids who had bullied him were putting pressure on the school and ask why it was that my son was getting ‘special attention,'” said Cianciotto.

The meeting made it clear that they needed to find a safer school for their son. Daniel was pulled out of school and an emergency transfer to a new school was approved.

“These allegations are deeply troubling and there is absolutely zero tolerance for bullying or harassment of any kind in our schools,” a spokesperson for the New York City DoE told Insider in an email statement. “Every student deserves to feel safe, welcomed, and affirmed in their school and we have invested in training and support to reform classroom culture, with a focus on inclusive policies and effective strategies to prevent bullying,” the statement continued.

“The safety of our students is our number one priority and we will review the complaint and immediately investigate the claims,” the spokesperson added.

The school had bullying rates significantly above the district average

Cianciotto and his attorneys are now seeking to hold the Albert Shanker school and the DoE and BoE accountable for the bullying Daniel experienced.

“We want to do everything we can to make sure that other kids like my son don’t experience this kind of bullying,” Cianciotto said.

Daniel, who is now 14, is at a middle school in the same district. “The difference is night and day,” his father said.

The complaint highlights that the Albert Shanker school had bullying rates significantly above the district average while Daniel attended it, according to the Department of Education’s School Quality Surveys.

The 2018-2019 survey outlines that 42% of respondents said that students harass, bully or intimidate each other based on gender, gender identity, gender expression, or sexual orientation, compared to 24% elsewhere in the district.

This highlights the school’s notable failings, according to the complaint.

“What that really highlighted for us is that it’s very possible and actually is safe in some schools for kids where bullying is addressed quickly and stopped, and the law is followed,” Cianciotto reflected.

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Scarlett Johansson’s “Black Widow” paycheck is tied to box office performance. She’s reportedly suing Disney for releasing it on streaming.

black widow
“Black Widow.”

  • “Black Widow” actress Scarlett Johansson is reportedly suing Disney over the movie’s dual-release.
  • The lawsuit argues that Disney violated her contract by debuting the film online and in theatres.
  • A source said the move cost her up to $50 million since her salary is largely based on box office performance.
  • See more stories on Insider’s business page.

Actress Scarlett Johansson is suing Disney after the company simultaneously released her film “Black Widow” on its Disney+ streaming platform and in theatres, according to The Wall Street Journal.

Johansson argues that Disney violated her contract, potentially bilking her out of significant income, because her salary was largely based on box office performance. A source told the paper the actress could be missing out on an estimated $50 million.

According to the report, Johansson was concerned about the movie being released in part on Disney+. Her representatives contacted Marvel to ensure that the movie would solely be released in theatres. Per the report, Marvel’s chief counsel said they would speak with her if those plans changed.

“Black Widow” raked in $158 million in its global box office opening, while Disney saw $60 million in sales from at-home viewing purchases.

“Disney intentionally induced Marvel’s breach of the agreement, without justification, in order to prevent Ms. Johansson from realizing the full benefit of her bargain with Marvel,” reads the lawsuit, according to the WSJ.

Disney did not immediately respond to a request for comment. Representatives for Johansson did not immediately respond to a request for comment. Case information was not immediately available on the court’s website.

Disney+ and other streaming services took the unprecedented step and debuted movies at the same time online and in theatres in 2020 due to the pandemic. For example, Disney’s live-action Mulan remake saw a dual release, as did “Wonder Woman 1984” And “Zack Snyder’s Justice League” on Warner Bros.’ HBO Max.

But the move prompted backlash from the filmmaking world, including from directors Christopher Nolan and Patty Jenkins, who helmed the “Wonder woman 1984″ project.” Many speculated how traditional filmmaking could be impacted by releasing high-budget, high-quality movies online.

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Airbnb deals with thousands of sexual-assault allegations every year, but manages to keep many out of the public eye, report says

A key in a door lock.
  • Ex-Airbnb employees told Bloomberg the company faces thousands of sexual-assault claims annually.
  • Bloomberg’s investigation revealed Airbnb has kept many of those cases out of the public eye.
  • Payouts, arbitration, and NDAs have helped Airbnb avoid scrutiny on safety issues, Bloomberg found.
  • See more stories on Insider’s business page.

Former Airbnb employees said that the company deals with thousands of sexual-assault allegations every year, and that the vast majority of them never make it into the public eye, Bloomberg reported this week.

Its investigation disclosed new details about how Airbnb has used a combination of monetary settlements and legal tactics – such as mandatory arbitration clauses and nondisclosure agreements – to avoid lawsuits and negative press dealing with a variety of safety problems.

The result, Bloomberg found, is that regulators, researchers, and the public have had little visibility into the scope of safety incidents involving Airbnb and that courts haven’t had the opportunity to determine who should be held legally liable.

Airbnb spends about $50 million a year trying to make things right for guests and hosts who’ve had bad experiences. One woman received a $7 million settlement after she said she was raped, Bloomberg reported.

The company told Bloomberg fewer than 0.1% of stays involve safety issues, that most payouts deal with claims of property damage, and that six-figure payouts are “exceptionally rare.” But with 193 million nights booked in 2020, that could mean that some 193,000 Airbnb stays could’ve involved safety incidents, by the company’s accounting.

Airbnb has dealt with a number of high-profile incidents over the years, including its first major scandal in 2011 after guests trashed a host’s home and a fatal shooting in Orinda, California, in 2019 that forced the company to crack down on party houses and ramp up efforts to keep guests and hosts safe.

Bloomberg’s reporting showed that Airbnb avoided scrutiny for serious incidents involving its guests, hosts, and listings, including numerous claims of sexual assault and a murder case.

Airbnb used to include a nondisclosure agreement in every case it settled, which prevented people from talking about their experiences, asking for more money, or suing the company, Bloomberg reported, adding that the company stopped the practice in 2017 as the #MeToo movement highlighted how NDAs often silence survivors of sexual assault.

An Airbnb spokesman, Ben Breit, told Insider that to the company’s knowledge, “There are no settlement agreements related to sexual assaults at listings prior to 2017.” (The $7 million settlement with the woman who was sexually assaulted was reached in 2017, after Airbnb stopped pursuing settlements with NDAs that prevent survivors from discussing details of their experiences, Bloomberg reported).

Airbnb has avoided lawsuits and public scrutiny over safety by including a mandatory arbitration clause in its terms of service. Such clauses prevent Airbnb guests and hosts from suing the company in court, where records are made public, instead forcing them to bring disputes through an arbitration system that’s funded by, and often favors, companies – and where proceedings are kept confidential.

That apparently led to only one sexual-assault case being filed against Airbnb, which the courts allowed to proceed because, they said, the company hadn’t done a thorough background check on the host, who had previously been accused of assault, Bloomberg found.

Airbnb declined to comment on its use of arbitration clauses.

Airbnb’s ability to reach settlements and avoid lawsuits, either dealing with sexual assault or other safety issues, has prevented courts from determining when and to what extent short-term rental-booking sites should be held liable for crimes involving its users or listings, Bloomberg reported.

Many cities have introduced regulations aimed at Airbnb and its competitors in recent years, and Airbnb has devoted additional resources to keeping users safe. But, Bloomberg said, as with Uber, Lyft, and other “platform” companies that initially skirted regulations as they grew rapidly, being able to obscure the extent of safety issues from public view has left regulators lagging far behind.

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Mike Lindell’s lawyer has left his law firm, after being accused of filing a suit against Smartmatic and Dominion without authorization

MyPillow CEO Mike Lindell
Mike Lindell.

  • Alec Beck, the lawyer representing MyPillow CEO Mike Lindell, has parted ways with his law firm.
  • The move comes a day after he filed a new lawsuit against Smartmatic and Dominion Voting Systems.
  • According to Beck’s former employer, the lawsuit was filed without any authorization.
  • See more stories on Insider’s business page.

Alec Beck, the lawyer representing MyPillow’s CEO, Mike Lindell, has left his law firm a day after filing a new lawsuit against Smartmatic and Dominion, according to Bloomberg.

Barnes & Thornburg, Beck’s former employer, said he filed the suit without its authorization.

The company issued a statement on Twitter on Friday night: “Late last night, firm management became aware that a Minneapolis firm lawyer filed a complaint, as local counsel, in federal district court without receiving firm authorization pursuant to internal firm approval procedures,” it said.

Lindell’s new lawsuit, filed in federal court in Minnesota, accuses both voting-machine companies of “weaponizing the litigation process to silence political dissent and suppress evidence showing voting machines were manipulated to affect outcomes in the November 2020 general election.”

As previously reported by Insider’s Grace Dean, Lindell stands to lose $2 billion over the legal battle.

Lindell’s latest complaint featured references to dystopian novels and William Shakespeare. One of the included quotes is attributed to Ray Bradbury’s “Fahrenheit 451”: “But you can’t make people listen. They have to come round in their own time, wondering what happened and why the world blew up around them. It can’t last.” Another quote is from George Orwell’s classic novel “1984.”

Legal experts have spoken out about Lindell’s latest filing. These included attorney Akiva Cohen, who described it as “craptastic” and “half-assed” in a series of tweets.

In its Friday statement, Barnes & Thornburg added: “Firm management took action immediately. The firm has withdrawn as local counsel in this matter and has ended the client relationship. The attorney representing the client in this matter is no longer with the firm.”

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Grubhub is facing 14 lawsuits from angry investors who say it misled them about its $7.3 billion takeover by Just Eat Takeaway

grubhub
GrubHub CEO Matt Maloney (C) applauds after ringing the opening bell before the company’s IPO on the floor of the New York Stock Exchange in New York April 4, 2014. Shares of GrubHub Inc, the biggest U.S. online food-delivery service, rose as much as 57 percent in its market debut as investors scrambled for a piece of the fast-growing consumer internet company.

  • Grubhub said it faces 14 lawsuits alleging it misled investors about its Just Eat Takeaway merger.
  • The lawsuits claim Grubhub withheld key financial protections and executives’ conflicts of interest.
  • Investors want the court to invalidate the merger until Grubhub secures a better deal for them.
  • See more stories on Insider’s business page.

Grubhub disclosed in a regulatory filing Thursday that it’s facing 14 lawsuits from investors who say the company misled them about its plans to be acquired by Dutch food delivery giant Just Eat Takeaway.

The investors alleged that Grubhub executives and board members failed to disclose key financial details and massive payouts that they stood to receive as part of the merger, and that they failed to secure the highest possible price for Grubhub’s public shareholders, harming them financially as a result.

Frank Ferreiro, the lead plaintiff in the case, said in a lawsuit filed in New York last month that when Grubhub publicly announced the proposed merger, it withheld underlying financial data it had used to make assumptions about the companies’ future performance, as well as well as “golden parachutes,” job offers, and other lucrative perks guaranteed to Grubhub executives and directors.

Ferreiro’s lawsuit alleged that investors like himself – who would get roughly 0.67 share of Just Eat stock for each of their Grubhub shares regardless of either company’s stock price when the merger closes – lack the information to determine whether they’re getting a raw deal.

“Grubhub insiders are the primary beneficiaries of the Proposed Transaction, not the Company’s public stockholders,” the lawsuit stated.

Ferrerio also said that GrubHub didn’t try hard enough to get the best deal for public investors.

His lawsuit asks the court to invalidate the proposed merger agreement and force Grubhub to seek the “highest possible price” for any sale.

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‘Apple is eating our lunch’: Google employees admit in lawsuit that the company made it nearly impossible for users to keep their location private

Google New York Office
Google in Manhattan.

Newly unredacted documents in a lawsuit against Google reveal that the company’s own executives and engineers knew just how difficult the company had made it for smartphone users to keep their location data private.

Google continued collecting location data even when users turned off various location-sharing settings, made popular privacy settings harder to find, and even pressured LG and other phone makers into hiding settings precisely because users liked them, according to the documents.

Jack Menzel, a former vice president overseeing Google Maps, admitted during a deposition that the only way Google wouldn’t be able to figure out a user’s home and work locations is if that person intentionally threw Google off the trail by setting their home and work addresses as some other random locations.

Jen Chai, a Google senior product manager in charge of location services, didn’t know how the company’s complex web of privacy settings interacted with each other, according to the documents.

Google and LG did not respond to requests for comment on this story.

The documents are part of a lawsuit brought against Google by the Arizona attorney general’s office last year, which accused the company of illegally collecting location data from smartphone users even after they opted out.

A judge ordered new sections of the documents to be unredacted last week in response to a request by trade groups Digital Content Next and News Media Alliance, which argued that it was in the public’s interest to know and that Google was using its legal resources to suppress scrutiny of its data collection practices.

The unsealed versions of the documents paint an even more detailed picture of how Google obscured its data collection techniques, confusing not just its users but also its own employees.

Google uses a variety of avenues to collect user location data, according to the documents, including WiFi and even third-party apps not affiliated with Google, forcing users to share their data in order to use those apps or, in some cases, even connect their phones to WiFi.

“So there is no way to give a third party app your location and not Google?” one employee said, according to the documents, adding: “This doesn’t sound like something we would want on the front page of the [New York Times].”

When Google tested versions of its Android operating system that made privacy settings easier to find, users took advantage of them, which Google viewed as a “problem,” according to the documents. To solve that problem, Google then sought to bury those settings deeper within the settings menu.

Google also tried to convince smartphone makers to hide location settings “through active misrepresentations and/or concealment, suppression, or omission of facts” – that is, data Google had showing that users were using those settings – “in order to assuage [manufacturers’] privacy concerns.”

Google employees appeared to recognize that users were frustrated by the company’s aggressive data collection practices, potentially hurting its business.

“Fail #2: *I* should be able to get *my* location on *my* phone without sharing that information with Google,” one employee said.

“This may be how Apple is eating our lunch,” they added, saying Apple was “much more likely” to let users take advantage of location-based apps and services on their phones without sharing the data with Apple.

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Amazon hit with 5 lawsuits from warehouse and corporate employees alleging discrimination and retaliation

FILE PHOTO: An Amazon worker delivers packages amid the coronavirus disease (COVID-19) outbreak in Denver, Colorado, U.S., April 22, 2020. Picture taken April 22, 2020. REUTERS/Kevin Mohatt/File Photo
FILE PHOTO: An Amazon worker delivers packages.

Amazon is facing a wave of five new lawsuits filed Wednesday by employees across its workforce who say they faced illegal discrimination and retaliation on the job, primarily from white male managers.

The lawsuits were filed by current and former Amazon corporate and warehouse employees in Arizona, California, Pennsylvania, and Washington state. They accuse Amazon managers and HR employees of racial, ethnic, and gender discrimination, as well as sexual harassment, and allege systemic biases in hirings, promotions, and firings at Amazon based on race and gender.

Four of the employees claim they were retaliated against after raising complaints, three of which were fired, and attorneys for the employees said Amazon’s top executives and HR department “routinely protected and abetted” abusive managers

“Women and employees of color at all levels of Amazon have had their complaints of harassment and discrimination brushed under the rug and met with retaliation for years,” Lawrence Pearson and Jeanne Christensen, attorneys at the law firm Wigdor who are representing the five employees, said in a statement.

“Amazon can no longer dismiss abusive behavior and retaliation by white managers as mere anecdotes. These are systemic problems, entrenched deep within the company and perpetuated by a human resources organization that treats employees who raise concerns as the problem,” the attorneys added.

In a statement to Insider, an Amazon spokesperson said: “We are conducting thorough investigations for each of these unrelated cases, as we do with any reported incidents, and we have found no evidence to support the allegations.”

“Amazon works hard to foster a diverse, equitable, and inclusive culture. We do not tolerate discrimination or harassment in any form, and employees are encouraged to raise concerns to any member of management or through an anonymous ethics hotline with no risk of retaliation,” the spokesperson added.

The lawsuits come ahead of Amazon’s annual shareholder meeting, where investors are set to vote on a proposal introduced by the New York Common Retirement Fund that would require Amazon to undergo an independent racial equity audit. Amazon unsuccessfully tried to get the proposal tossed out.

The National Labor Relations Board has accused Amazon of illegally firing multiple workers who protested the company’s working conditions, and Recode recently reported that internal Amazon data shows Black employees are hired and promoted at disproportionate rates than their white counterparts.

Chris Smalls, an Amazon employee fired in March 2020 after protesting working conditions, also filed a lawsuit in November accusing the company of violating civil rights laws by failing to protect Black, Brown, and immigrant warehouse workers from COVID-19 while looking out for its mostly white managers.

The latest wave of lawsuits were filed by:

  • Tiffany Gordwin, a Black female senior HR specialist in Avondale, Arizona, who accused Amazon of tricking her into applying for a lower role than what she qualified and interviewed for, and who works for a white manager who is working on his master’s degree even though she completed her MBA degree seven years ago;
  • Diana Cuervo, a Latinx female warehouse manager in Everett, Washington, who claimed her Amazon supervisor made comments such as “Latins suck,” and said she was fired weeks after complaining about the harassment she faced as well as a gas leak in the facility;
  • Cindy Warner, a gay female Amazon Web Services executive in Irvine, California, who accused the company of falsely saying it didn’t hire internally for a position she was qualified for, and claimed a male coworker called her a “b—” and “idiot” in front of other coworkers and then fired her after complaining and retaining an attorney;
  • Emily Sousa, an Asian-American female warehouse manager in Harleysville, Pennsylvania, who claimed a male manager compared her to an adult film star, and that she was demoted after complaining about sexual and racial harassment by another male manager;
  • Pearl Thomas, a Black female HR employee in Washington state, who claimed her supervisor called her the “n-word” and that when she complained about racial discrimination, her own HR representative dismissed her concerns by suggesting she was emotional because of Derek Chauvin’s trial.
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Tesla ordered by judge to turn over documents related to Elon Musk’s $55 billion compensation plan

Elon Musk
  • A judge on Monday ordered Tesla to turn over documents concerning Elon Musk’s compensation plan.
  • Shareholders sued Tesla in 2018, arguing its board wronged investors by awarding Musk such a lucrative package.
  • The judge told Tesla to turn over communications between Musk and its top lawyers ahead of the board’s approval of the plan.
  • See more stories on Insider’s business page.

A Delaware judge on Monday ordered lawyers representing Tesla’s board of directors to turn over certain communications that CEO Elon Musk may have shared with the company’s top in-house attorneys before the board approved a compensation plan in 2018 that could net Musk more than $50 billion.

The ruling by Vice Chancellor Joseph Slights Jr. came in response to a motion to compel filed on behalf of shareholders who have accused Musk and Tesla’s board of directors of breaching their fiduciary duties to the company and its stockholders, granting unjust enrichment to Musk and wasting corporate assets.

While granting the plaintiffs access to certain documents that Musk either sent or received, Slights denied access to a broader range of other documents that defense attorneys have argued are similarly protected by attorney-client privilege.

Slights said documents that Musk shared with Tesla general counsel Todd Maron or deputy general counsel Jonathan Chang before the board signed off on the compensation plan should be provided to the shareholder plaintiffs.

The plaintiffs have argued that Chang and Maron, who was Musk’s former divorce attorney, worked to advance Musk’s interests and negotiated on his behalf against the board’s compensation committee.

“Leveraging his control, close personal relationships, and reputation for retribution, Musk co-opted Maron and Chang to help him structure the plan free from committee involvement,” plaintiffs’ attorneys wrote in asking Slights to force the company to turn over documents.

“Musk and his agents handed the committee a fully-baked plan,” they added.

While Slights agreed that communications directly involving Musk should be disclosed, he refused to order defense attorneys to turn over other communications among board members, Chang and Maron, and an outside law firm.

The judge said there was no basis for him to order the production of documents that may be protected by attorney-client privilege when the information might be available from other sources. He noted that Musk, Maron, Chang and compensation committee chair Ira Ehrenpreis have yet to be deposed in the case.

The plaintiffs argued in their motion to compel that Tesla was improperly shielding hundreds of documents that Maron or Chang shared with the compensation committee and its advisers.

Attorney Gregory Varallo told Slights on Monday that the plaintiffs in the lawsuit, which was filed in 2018, still don’t have an answer to a simple question: “Whose idea was the largest compensation plan ever designed?”

“If you read the record to date, no one seems to know,” said Varallo.

“There was quite a lot of sausage-making taking place before this was even a twinkle in the eye of the compensation committee,” he added.

Vanessa Lavely, an attorney representing the Tesla directors, told Slights that the board followed “a robust process” to develop and approve the compensation plan.

“There was absolutely no rubber-stamping here, and the defendants look forward to the opportunity to present this record to the court,” she said.

In 2019, Slights refused to dismiss the breach-of-duty claims against Musk and Tesla directors, and an unjust enrichment claim against Musk.

Under Delaware’s “business judgment” rule, courts typically give strong deference to a corporate board’s decision-making unless there is evidence that directors had conflicts or acted in bad faith. If a plaintiff is able to overcome the business judgment rule’s presumption, the board’s action is then subject to an “entire fairness” analysis, which shifts the burden to the corporation to show that the deal involved both fair dealing and fair price.

Slights said that because the plaintiffs had adequately pleaded that Musk was a controlling shareholder and had a conflict of interest, the case lent itself to “heightened judicial suspicion.”

Under the plan, Musk stands to reap billions if the electric car and solar panel maker hits ambitious market capitalization and operational milestones. For each of 12 milestones the company achieves, Musk, who already owned more than 20% of Tesla when the plan was approved, would get stock equal to 1% of outstanding shares at the time of the grant.

Each milestone includes growing Tesla’s market capitalization by $50 billion and meeting aggressive revenue and pretax profit growth targets. Musk would receive the full benefit of the pay plan, $55.8 billion, only if he leads Tesla to a market capitalization of $650 billion and unprecedented revenues and earnings within a decade.

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MyPillow CEO Mike Lindell claimed in a lawsuit against the Daily Mail that churches are disassociating with him because the tabloid reported he had a secret romance with Jane Krakowski

lindell krakowski mypillow
  • The Daily Mail reported in January that Mike Lindell had a “secret nine month romance” with Jane Krakowski.
  • Both Lindell and Krakowski denied the alleged relationship in the report. Lindell later sued the British tabloid for defamation.
  • He revised the lawsuit Tuesday to add that his nonprofit’s relationships with churches has been impacted as a result of the report.
  • See more stories on Insider’s business page.

MyPillow CEO Mike Lindell revised his lawsuit against the Daily Mail Tuesday, adding a claim that churches are disassociating with him because of the British tabloid’s claims about an alleged romance with actress Jane Krakowski.

The Daily Mail published a report in late January 2021 claiming that the MyPillow founder had a “secret nine-month romance” with the “30 Rock” star. Both Lindell and Krakowski denied the report.

“Jane has never met Mr. Lindell. She is not and has never been in any relationship with him, romantic or otherwise,” a publicist for Krakowski said in a statement at the time. Lindell said he had “never even heard” of the actress before.

In the week after the report was published, Lindell filed a lawsuit against the Daily Mail for defamation, claiming the article had caused him “tremendous harm to his personal and professional reputation and prospective economic opportunities, as well as causing him significant humiliation and emotional distress.”

The Daily Mail did not immediately respond to a request for comment.

According to court documents, Lindell specifically cites the report’s claim that he gifted alcohol to Krakowski during their alleged relationship.

“As a recovering addict and alcoholic who frequently writes and speaks publicly about his spiritual triumphs over substance abuse, Mr. Lindell is horrified by the Defendants’ fabricated and very public accusations,” the lawsuit read.

On Tuesday, Lindell revised the lawsuit against the British tabloid, adding an amendment about how the report impacted the associations with the Lindell Recovery Network, a “faith-based” nonprofit founded in 2019 that “provides services for various forms of addiction, mostly substance, and behavioral addiction, along with co-morbidities such as anxiety and addiction,” according to the lawsuit.

“Mr. Lindell’s name is attached to the network and his personal story as a Christian who came back from his addiction to become a success is emphasized,” the lawsuit read.

Lindell claimed that the organization has only been able to partner with “a handful of churches,” and the lawsuit said churches “may be pulling out because of Defendants’ allegations about Mr. Lindell.”

It was not immediately clear as to why the report may have impacted the LRN’s affiliations with Christian networks and churches, and Insider reached out to MyPillow and to Lindell for more information.

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Roger Stone sued by federal government for nearly $2 million in unpaid taxes and interest

Roger Stone, longtime political ally of U.S. President Donald Trump, arrives for a status hearing in the criminal case against him brought by Special Counsel Robert Mueller at U.S. District Court in Washington, U.S., April 30, 2019. REUTERS/Joshua Robertsle
Roger Stone.

  • GOP strategist and Trump ally Roger Stone and his wife were sued by the federal government for $2 million in unpaid taxes.
  • The complaint accused the couple of using their company to avoid paying personal income tax.
  • Stone was indicted in 2019 on several charges connected to the Mueller investigation on Russian interference in the 2020 election. He was later pardoned by Trump.
  • See more stories on Insider’s business page.

Former GOP strategist Roger Stone was sued Friday by the federal government for nearly $2 million in unpaid taxes, interest, and penalties.

The complaint was filed Friday against Stone and his wife Nydia Stone to collect unpaid federal income tax liabilities for nearly $1.6 million between the years 2007 through 2011, as well as more than $400,000 in 2018, according to court documents.

The suit, which is not an accusation of criminality, was filed in the US District Court for the Southern District of Florida.

Stone was indicted on several felonies in January 2019 – including making false statements to Congress, obstruction of justice, and witness tampering – in connection with the special counsel Robert Mueller’s investigation on Russian interference in the 2016 election.

Former President Donald Trump commuted Stone’s 40-month prison sentence in July last year, then later granted Stone a full pardon on the felony charges in December 2020.

According to the complaint, the Stones used a company they owned called Drake Ventures to pay their federal taxes. After Stone was indicted in January 2019, they opened a trust through the company to help them purchase their residence in Florida, which has no state income taxes.

“Although they used funds held in Drake Ventures accounts to pay some of their taxes, the Stones’ use of Drake Ventures to hold their funds allowed them to shield their personal income from enforced collection and fund a lavish lifestyle despite owing nearly $2 million in unpaid taxes, interest, and penalties,” the complaint read.

The Stones failed to pay their $20,000 monthly installment payment to the IRS in March 2019, according to the complaint, causing the agency to terminate its installment agreement, according to the lawsuit.

“The Stones intended to defraud the United States by maintaining their assets in Drake Ventures’ accounts, which they completely controlled, and using these assets to purchase the Stone Residence in the name of the Bertran Trust,” according to the complaint.

In a statement to CNN, Stone called the complaint “preposterous.”

“They are well aware that my two-year struggle against the epically corrupt Mueller investigation has left my wife and I on the verge of bankruptcy,” Stone said in the statement. “I have continued to eke out a living through my company Drake Ventures.”

“To describe my current lifestyle as ‘lavish’ will be proved to be ridiculous in court. The political motivation of the DOJ Will be abundantly clear at trial,” he continued.

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