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Protecting A Family's Reputation By Preventing Sexual Harassment

Celebrity chef Mike Isabella blames his loss of business and his Chapter 11 bankruptcy on the fact the media reported that a sexual harassment lawsuit had been filed against him.

Mike Isabella Concepts once owned 12 restaurants, several Nationals baseball park stands, and a 41,000-square-foot food hall in the Washington, D.C. area. However, in March 2018, a manager at one of Isabella's restaurants filed a sexual harassment and retaliation lawsuit against the chef and several other executives, and business began to suffer.

A Vox Media entity, Eater, which reviews and discusses news in the restaurant and food world, removed Isabella's establishments on its lists and maps. Sales at his restaurants declined immediately, and the Nationals ended their business relationship with him, although the Nationals' spokesperson stated that two of the chef's three ballpark restaurants were slated for closure before the sexual harassment allegations arose. The chef's food hall closed less than nine months after opening, and the chef closed three other restaurants before filing for Chapter 11 bankruptcy.

Isabella hopes that bankruptcy will allow him to "stop the bleeding," restructure his finances, and rebuild his business. Isabella and his executive team will retain control of Mike Isabella Concepts.

The chef says that articles written on the sexual harassment lawsuit have also scared away good workers. Tim Carman and Maura Judkis "Celebrity chef Mike Isabella declares bankruptcy in wake of sexual harassment lawsuit" washingtonpost.com (Sep. 06, 2018).


Commentary and Checklist

Lawsuits are public records. One lawsuit, particularly a sexual harassment lawsuit, can damage the reputation of a family. Therefore, family employers must take strong measures to prevent sexual misconduct in the workplace.

Family employers must stress that staff respect the boundaries of other staff or of anyone who interacts with the family office.

Make sure your staff is trained on promptly reporting sexual misconduct, and supply several reporting mechanisms to use to report sexual harassment.

If a member of your staff reports wrongdoing, immediately arrange for an investigation and protect the reporter from retaliation to prevent a lawsuit. Every report should be investigated and responded to appropriately.

Here is some additional information regarding workplace investigations:
 

  • Clearly define the investigator's role. Consider using a third party to manage staff complaint investigations, especially for high-risk matters.
  • Select a trained investigator. Make sure the investigator has the ability to be objective, calm, courteous, and professional.
  • A thorough investigation of the complaint can avoid critical information or facts coming to light after the investigation is completed. If this happens, you must cause another investigation to ensue or any defense you base upon the first, incomplete investigation will lack credibility.
  • Manage the investigation with discretion, but do not promise complete confidentiality to the parties involved because certain disclosures may need to be made to complete the investigation.
  • Document all interviews and subsequent actions. Notes from all interviews should be recorded at the time or shortly after the interview and reviewed with the interviewee for accuracy.
  • Unless there is a reason why information cannot be shared, such as criminal conduct, be sure to communicate the final resolution to all those involved.
  • If you believe that an investigation was done poorly, appoint someone to review the investigation and, if necessary, perform a second investigation.
  • If the investigation shows that, more likely than not, wrongdoing occurred, discipline the perpetrator. If the offense is of a serious nature, termination is the best choice to prevent future wrongdoing.
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