Ellen Pao recently asked KPCB for $2.7M in order not to appeal, nearly 3X what she was offered as a settlement before the case went to trial
& claim Pao also negotiated for an addt'l $2.7M payment. Kara Swisher / @karaswisher : Why did Ellen Pao file to appeal? Follow the legal fees. http://recode.net/... via @LizGannes
Context & Ripple Effects
The fee fight has become the real second act of the Pao-KPCB case. After her March loss, Kleiner Perkins dangled a way out: per WSJ filings, it offered to waive nearly $1M in legal fees tied to the roughly $965K settlement floated before trial — an exit that would have ended the matter quietly.
Instead, Pao filed a notice of appeal in early June, and Re/code now reports she had asked KPCB for $2.7M to skip the appeal — nearly three times the pre-trial number — plus negotiations over another $2.7M payment. Kara Swisher's framing is blunt: follow the legal fees. The judge has since cut KPCB's ask down to size, tentatively setting costs at $275K.
First-order effects
- Pao's appeal is now publicly legible as a financial negotiation: she priced dropping it at $2.7M against KPCB's earlier nearly-$1M fee-waive offer, leaving KPCB facing appellate costs and continued coverage instead of closure.
- KPCB's immediate exposure shifts from the verdict itself to the money trail — its own filings put the pre-trial settlement figure on record, giving reporters and opposing counsel a concrete baseline for every future counteroffer.
Second-order effects
- The judge's tentative roughly $276K cost award — less than a third of what KPCB wanted — weakens KPCB's fee leverage, since the gap between its $972K claim and the ruling becomes ammunition in any renewed settlement talks.
- Both sides' legal bills are now the de facto bargaining chip: with Pao liable for a comparatively small amount but facing appeal economics, the negotiation centers on who absorbs which fees rather than on retrial risk alone.
Third-order effects
- If the pattern holds, high-profile employment cases against venture firms will be resolved through legal-fee arithmetic as much as verdicts — firms using fee waivers as settlement currency, plaintiffs pricing appeals against their own litigation costs.
- That dynamic cuts both ways structurally: deep-pocketed firms can make non-appeal offers expensive enough to deter challenges, while judges trimming fee awards can blunt that leverage — making court cost rulings a quiet lever in how discrimination claims against the industry actually end.
The trend: Silicon Valley's marquee employment disputes are increasingly settled in the shadow of legal-fee economics, where waiver offers and cost rulings shape outcomes as much as jury verdicts do.