Though California-based social media platform Pinterest is only 11 years old, it’s worth billions of dollars and has more than 1,600 employees – and it now has its very own headline-generating scandal, too.
A shareholder lawsuit filed in a California federal court accuses Pinterest co-founders Ben Silbermann and Evan Sharp and other executives of violating their fiduciary duty by taking part in or ignoring gender and racial discrimination.
The suit alleges that the co-founders, CFO Todd Morgenfeld – and the company’s board of directors – “personally engaged in, facilitated or knowingly ignored the discrimination and retaliation against those who spoke up and challenged the Company’s white, male leadership clique.”
A shareholder since June, the Employees’ Retirement System of Rhode Island filed the lawsuit.
The lawsuit claims CEO Silbermann failed to properly address racial discrimination and retaliation against a pair of Black female former executives. He’s also accused of gender discrimination by excluding former COO Françoise Brougher from board meetings and other critical company activities.
Failing fiduciary duties
The suit also says the company’s board abdicated its fiduciary duties by underpaying Brougher “relative to similarly situated male colleagues.” It also alleges that Morganfield’s performance reviews of the former COO were negative due to gender-based bias.
Pinterest’s once sterling reputation has taken several hits this year, beginning in summer when the two Black female former executives accused the company of racial bias and then Brougher filed a gender discrimination and retaliation lawsuit.
Other shareholder lawsuits
Forbes notes that shareholder lawsuits can be used to hold executives accountable for workplace toxicity. Three months ago, Google parent company Alphabet settled several lawsuits triggered by the company’s $90 million exit compensation for a former executive who had been credibly accused of sexual harassment.