Disney's legal troubles escalate in equal pay lawsuit after class certification

Disney Parks, Elena of Avalor, the first Latin-inspired Disney princess, 2016.

Matt Strohchan/Disney Bulletin Getty Images

In 2014, Nancy Dolan—Disney’s director of creative music marketing—was denied a promotion to director over the objections of her supervisor, head of music Mitchell Lieb, who said she was “worth her weight in gold.” He called on senior officials to reconsider the decision.

“Nancy has served as executive vice president and has held the full VP position for more than three years at a fraction of the cost, which is invaluable to me,” Mitchell wrote in an email to Sean Bailey, president of Walt Disney Studios Motion Picture Productions. According to newly unsealed court filings in a pay bias lawsuit against the company.

Pointing to the “terrible results” in an employee satisfaction survey among women frustrated with career advancement opportunities, Mitchell added: “You only have to look at Nancy to see the inequality.” He stressed that he “had a hard time believing that my impression of what was intended for Nancy only could be so skewed from reality” and objected to HR “controlling the company line.”

Dolan, nine years later, still holds the same senior manager position that was offered to her at the time rather than a promotion to principal. She is now part of a group of nine women leading a growing class of nearly 9,000 workers who are suing Disney over discrimination against female workers, who they say are paid less than their male counterparts.

The letter regarding Dolan’s compensation and ownership in the company — part of a trove of nearly 200 court records unsealed Tuesday and reviewed by Hollywood Reporter – Challenge arguments made by Disney that it pays women and men equal salaries. In another email, Vice President of Compensation Nashon Bacon admits in 2020 there is an “equity pay nightmare.”

In 2019, Disney was subjected to a lawsuit accusing it of “rampant wage discrimination.” The case cleared a major hurdle on December 8 when a judge certified a diverse class of employees, who work across the company’s film production arm, record labels, theme parks and home distribution subsidiaries, among various other units including broadcast and R&D . It is believed to be one of the largest classes ever sued under an Equal Pay Act claim. The group includes women who were employed at Disney between April 2015 and three months before the trial, which is scheduled to begin in October next year, below the level of vice president.

The class certification was appealed by Disney. She said the lawsuit should not proceed as a class action because the company employs too many workers whose jobs cannot be compared to each other.

“They work in completely different industries, and they pay completely different wages,” said Felicia Davis, an attorney representing Disney, according to a transcript of the hearing. “They work in cruise lines, technology, theme parks, marketing, television, human resources, film, hotels, retail, finance, restaurants, legal. If you name a job, it’s part of this lawsuit.”

“Confirming this case, Your Honor, would be unprecedented,” Davis stressed. No discrimination or equal pay category like this has ever been ratified.

Los Angeles Superior Court Judge Elihu Pearl was unconvinced. She sided with Lori Andrews, the attorney representing the class, who said there was “strong evidence of Disney’s centralization and standardization of its practices.”

“The definition of the category and subcategory is clear and objective,” Pearl said. “Furthermore, there is no reasonable dispute that Defendants’ records contain all information necessary to identify potential class members.”

To proceed as a class action, there must be common issues of law and fact among a verifiable class represented by specific plaintiffs typical of that group. Pearl concluded that this was the case for the class suing under an EPA claim but not for the class of more than 12,000 women suing under a violation of the Fair Employment Housing Act.

This claim largely revolved around arguments that Disney relied on hiring candidates’ salaries at their previous jobs, which resulted in women being underpaid because raises were based on salary percentages, with the pay gap growing every year. The policy was changed in 2017, after California passed a law prohibiting employers from asking about wage history. Contrary to the EPA’s claim, Pearl concluded that there was no “common policy” binding the chapter together.

The lawsuit initially estimated damages at $150 million when it was filed, although Andrus said that number has changed. With the judge’s order certifying the dismissal, you will now pursue discovery to get to the heart of the discrimination allegations in the lawsuit. With no timetable for additional mediations to discuss settlement, the case is scheduled to go to trial in October.

“We are disappointed in the court’s ruling regarding our Equal Pay Act claims and are considering our options,” Disney said in a statement.