Shut Your Mouth

Big-Bucks Bloomy buys corporate silence in six sex and race cases

The problem with Mike Bloomberg's money isn't limited to the $175 million he'll soon have officially spent in two campaigns to tell us what he wants us to know about him. It's the untold millions he and his company have paid in secret settlements and other deals to make sure we never learn his whole story. The Voicehas tracked a half-dozen ex-employees of Bloomberg's closely held communications company who have wound up in nasty disputes with him-—on allegations ranging from maternity discrimination to sexual harassment to racial comments—and who will not discuss his conduct, often because of confidentiality agreements they have signed. These cases, which go beyond typical corporate fodder, raise questions about a side of him unseen since he became mayor. While some of these complaints have been resolved during his mayoralty, no new ones like them have emerged involving public employees. However, the timing and substance of the cases suggest that Bloomberg might never have become mayor had all the facts surfaced during the 2001 election. The silencing of these former staffers merits scrutiny before this election. Here's the list:

Sekiko Garrison: While her case of gender discrimination got a great deal of attention in 2001, culminating in a shrill television commercial aired by Democrat Mark Green, Bloomberg brushed past it by issuing a public denial of its core charge. One of several women who alleged in court documents that they'd "lost lucrative portions of their sales territory, were denied business opportunities and received inferior bonuses" once they got married or had children, Garrison claimed that Bloomberg told her twice to "kill it" when she informed him she was pregnant. He also added, according to Garrison: "Great! Number 16," a reference to the number of company women on maternity leave.

Garrison's attorney, Neal Brickman, would not even acknowledge that the case was settled, only that it was "resolved" in the early fall of 2000 and that he was not permitted to discuss it. He said Garrison, who now lives in Seattle, wouldn't discuss it either. Asked if he thought the case might have ended because Bloomberg was simultaneously announcing his interest in a possible 2001 mayoral race, Brickman told the Voice: "It certainly may have been, though it was never mentioned. This case went from one that was remarkably hotly contested to not hotly contested overnight." News reports in 2001 indicated that Bloomberg personally settled the case for a "substantial" sum pegged at "six figures."

Bloomberg was deposed in the case but his testimony has never become fully public due to the settlement. While his lawyers disputed the comments Garrison attributed to him, she retained a tape of a message he left for her both apologizing for the remarks and denying he made them. Had the case gone to trial, the bizarre recording would've been played in court. Bloomberg conceded during his deposition that he had used the expression "I'd do her" about Garrison, though he insisted that what he meant by the expression was that he would have a personal relationship with her. He reportedly tried to walk out of the deposition when asked if the Debbie who "did" Dallas in the infamous porn movie had a "personal relationship" with the entire city.


Mary Ann Olszewski: Her rape charge against a top Bloomberg L.P. executive was even more explosive than the Garrison allegations, and it too surfaced in part during the 2001 campaign. As the Voice revealed then, Bloomberg testified in the case that he would not believe the allegation was "genuine" unless there was "an unimpeachable third-party witness," adding that "there are times when three people are together." While Olszewski's attorney David Mair threw me out of his office in 2001 when I asked him if there was a settlement in the case, and Olszewski refused to comment, every indication is that Bloomberg "resolved" this time-bomb case as well.

His 272-page, 1998 deposition—in which he also said "my own morals would require" corroboration in rape cases generally and "I don't have an opinion" about whether false rape claims "are common"—would have never become public had not the Voice obtained it from a confidential source. Asked if he'd said he would like to "do that piece of meat" or that he'd "do her in a second," he only partially corrected the quotation: "I don't recall ever using the term 'meat' at all," he testified.

What has become clear since 2001 is that Olszewski, who was described by her attorney as unable to pay $14,769 in court costs, leased a new blue convertible BMW in Florida on February 19, 2001, the day before the case was finally dismissed in Manhattan federal court. She also moved into a $5,000-a-month Miami luxury condo on February 26, and on March 1 incorporated her own hedge fund, which she operated out of the unit. A year later, she paid $750,000 to buy another apartment in the same building. She still has the BMW.

At the final hearing in the case in October 2000, Judge Robert Patterson raised the question of a settlement, saying he was "sure the parties have discussed it from time to time," though he said he had no "insight" into "why, at this stage, there would be any hope" of one. The judge expressed concern that "there be justice here and not be some technicality standing in the way of justice"—an apparent reference to the fact that he'd dismissed the case once already because Olszewski's prior lawyer had not filed response papers on time. Also speaking sorrowfully about "any possible injustice" to Olszewski, Patterson issued a December 12 ruling giving her 28 days to file papers vacating his dismissal. Incredibly, after trying for a year to overturn Patterson's default judgment, Olszewski's new attorney Mair never filed the motion, even when Patterson extended the deadline. Mair refused again recently to discuss why, presumably because it would have required him to answer questions about a settlement.

Bloomberg made his first political speech at a GOP event on February 14, just as Patterson's deadline expired, and hired media whiz David Garth, who'd elected Ed Koch and Rudy Giuliani, the same day Patterson dismissed the case. Bloomberg took a leave from his company to run two weeks later. Had Mair filed for and won the vacate order, the case would've gone forward throughout the mayoral campaign, highlighting revelations that Bloomberg's company had conducted a lengthy investigation of Olszewski's sex life while simultaneously launching a joint defense with the accused rapist and even getting him a lawyer. The absence of any sex harassment procedures at the company until after the Garrison and Olszewski cases were filed would've added to the political embarrassment.

While the company denies it paid any settlement to Olszewski, the testimony of one Bloomberg-tied attorney in a related 2002 disciplinary proceeding was carefully parsed to leave open the possibility that Bloomberg, or an entity acting in his name, settled it. The Bloomberg campaign declined to answer questions about it.


Alan Feltoon:The best evidence that Olszewski won a bonanza was that Feltoon, who wound up settling two suits involving Bloomberg L.P., dropped the lawyers who'd been representing him for two years and hired Mair a month after the Voice story about his handling of the Olszewski case appeared. An architectural contractor who did major work for Bloomberg for five years, Feltoon was fighting a Bloomberg lawsuit charging that he'd defrauded the company. Soon after Feltoon switched to Mair in November 2001, the federal judge in the case ordered a deposition of Bloomberg for January 11, 2002, just days after he was inaugurated.

A few hours before the scheduled deposition, Bloomberg L.P. settled the case on terms both parties refused to reveal. Then, in September 2002, Mair resurrected the issues by suing another Bloomberg architectural firm, contending that it had conspired with the mayor's company to illegally copy millions of dollars' worth of Feltoon's work. While Bloomberg L.P. wasn't named in the second suit, a New York Observer story cited experts and evidence predicting that Bloomberg would again face the witness stand. The Observer reported that Bloomberg's company was not named because the settlement of the earlier case barred Mair and Feltoon from suing it directly. Feltoon recently e-mailed the Voice that he "settled" this case in late 2003 "and was satisfied with the resolution," refusing to spell out the details.

Pointing to the damaging impact of Bloomberg's testimony in the rape case, news stories in 2002 noted that "a deposition of Bloomberg would seek to lay bare in intricate detail the inner workings of the top echelons" of his company. The stories added that he might also have been asked about the sexual harassment charges of a former employee sued in the same case, Diane Winger, who claimed that Bloomberg had made explicit comments about her body and encouraged her to spend time alone with him. Winger's husband, Joseph Menno, another Bloomberg executive named in the civil suit, wound up pleading guilty to criminal charges of defrauding the company.

However, testimony in the Olszewski case, available to Mair, revealed that Winger was fired after she filed her harassment complaint and that Bloomberg then personally ordered the internal probe of Menno's work that eventually led to his prosecution. When Menno pled guilty, Bloomberg L.P. settled its suit against him and Winger.


Susan Friedlander Calzone: The witness whose Olszewski deposition detailed the sequence of events in the Winger case, Calzone was one of the highest-ranking female executives at Bloomberg L.P. for years, in charge of administration. By her own testimony, she orchestrated the company's handling of these three and other sexual harassment cases, personally participating in the initial debriefing of Olszewski's alleged rapist and managing the corporate handling of Garrison and Winger. She testified about Olszewski wearing "a sheer white blouse without a bra" to work, stated that she had "no reason not to believe" the executive charged with raping Olszewski, and offered an extraordinary account of the voice mail message she heard Bloomberg leave for Garrison: "He may have said sorry. I can't remember the words. You know, blah, blah, blah, blah, come see me." Ironically, Bloomberg's campaign spokesman Stu Loeser says that Calzone is now in charge of Women for Bloomberg, which has hosted several highly successful events for the mayor in 2005. Yet two sources told the Voice that Calzone herself went to a lawyer to discuss a possible suit against Bloomberg L.P., charging that when she returned to the company after a maternity leave in 2001, she was displaced by a male executive and not given her full portfolio of responsibilities. Since Bloomberg was on leave and only intermittently involved with the company in 2001, his role in these decisions is unclear.

Calzone did not sue, worked for months at campaign headquarters, and was then seen repeatedly at City Hall, sparking news stories that she might become a deputy mayor. She was even paid $9,000 by Bloomberg's committee in December 2001 to help with the transition. Instead, she returned to the company and remained there until early this year, when news stories again noted that she was leaving it to join the campaign.

But just how Bloomberg has kept this high-six-figure executive with young twins happy is a financial mystery. She appears three times on the 2005 filings of Bloomberg's committee for a skimpy total of $1,099, all as reimbursements for expenses she advanced the campaign, starting in June. One of her close friends, ex–Bloomberg executive Susette Franklin, says she has met and talked with Calzone a few times this year, even attending a Women for Bloomberg event. "I would've assumed she was paid by the campaign," Franklin says. Calls to Bloomberg's main headquarters connect to her voice mail, but Loeser could not explain how she was paid.


Elizabeth DeMarse: Marketing director at the company, DeMarse hit the headlines in 2001 when she confirmed that she'd compiled a 32-page pamphlet of offensive Bloomberg quotes given to him on his 50th birthday. She told New York magazine that Bloomberg "says this stuff"—a collection of sex and race gags—"to customers and new hires and anyone who comes into the office. These are his lines. Everything in there I've heard him say many times. I sat next to him for seven years." One quip was that "if women wanted to be appreciated for their brains, they'd go to the library instead of to Bloomingdale's."

But then Bloomberg lawyers called her and told her not to "answer any questions about the company or Bloomberg himself." According to news accounts at the time, she said she was restricted by a confidentiality agreement she signed as part of a severance package. Bloomberg said his lawyers were doing "what they're supposed to do" and told reporters not "to waste your time asking" that he allow DeMarse to speak out. In fact, the heat got so intense DeMarse left town for Florida during the general election campaign, sources said. The concern was not just the racy booklet, but that DeMarse had reportedly been a witness to the "kill it" comment in the Garrison case, as well as to Bloomberg's conflicting voice mail call.


Burton Waddy: A top black executive at the company until June 2005, he left deeply disturbed about comments he regarded as racial that were allegedly made by Bloomberg. Three people who have talked to him about these comments say that he reached an apparent settlement with the firm not to discuss the remarks. Peter Noel, a former Voice reporter who is now a freelance writer and radio host, says that he conducted taped interviews "three years ago" with Waddy and Harold Doley III, a high-ranking black employee of the 2001 Bloomberg campaign. Noel says that they told him "damaging" stories about Bloomberg, but that he could not discuss the specifics because Waddy had subsequently asked him not to.

Doley confirmed that he and Waddy had talked to Noel on tape, but Waddy referred the Voice to his attorney, Denise Bonnaig, who would not answer any questions. Doley said Waddy was "bellicose" about these Bloomberg comments until this April, when he was "shut down." While two of these sources did indicate what some of these comments were, neither would go on the record about them for fear of hurting Waddy. That's why the Voice will not print any of these alleged remarks.


The six sagas here are both unsettling and incomplete. The confidentiality blanket that covers them gives each episode a powerfully suggestive aura short of definitive fact, but the cumulative picture that emerges is one of a corporate Bloomberg awash in unusual personnel problems either connected to his own unhinged repartee or his company's insensitive policies.

As mayor and candidate, Bloomberg often lays claim to the company's progressive initiatives, telling gay groups, for example, about its enlightened health care coverage for unmarried spouses. In the same spirit, he has to accept responsibility for its dark side, depicted in the handling of these individuals. He created Bloomberg L.P., still owns 72 percent of it, and is said to periodically involve himself, ever so discreetly, in its big business decisions. It remains a window into his inner world, however clouded, and part of the portrait of him every voter should know.


Research assistance: Jessica Bennett, K. Emily Bond, Ben James, Lee Norsworthy, Xana O'Neill, and Nicholas Powers

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