Paradigm Rocked With $2M Breach Of Contract Suit By Debbee Klein; Sam Gores Accused Of Using Agency As “Personal Piggy Bank”

BREAKING … Less than two weeks after Sam Gores dropped the hammer on scores of agents at Paradigm in what were termed temporary layoffs allegedly due to the asphyxiating effect of the coronavirus crisis on the industry, Debbee Klein has hit back with a seemingly devastating breach of oral contract lawsuit for “this reprehensible behavior.”

Though Gores himself isn’t actually named as a defendant in this initial version of the jury seeking complaint from the 23-year veteran packaging agent for $2 million and more, the Paradigm chairman is strewn all the paperwork. Gores is cited in the tales of unrewarded loyalty, repeated claims of “his sexual dalliances with prostitutes” hired with company money, corporate funds used as a “personal piggy bank,” a self-sabotaged big bucks deal for Paradigm to be bought by UTA and rampant sexism, among other allegations by one of his long time lieutenants.

“Despite Mr. Gores recently praising Ms. Klein was the ‘best agent’ at Paradigm, he rewarded her loyalty and consistent high-performance by terminating her employment via a phone call lasting less than one minute,” the five claim document filed last last night in Los Angeles Superior Court (read it here) proclaims for the rep who put together black-ish and its two spinoffs and much more over the years.

“This occurred less than an hour after he sent Ms. Klein a text message stating, ‘don’t know what’s going to happen, but wanted to say hi and love you,’” the packed compliant from lawyers Bryan Freedman and Sean Hardy notes of the March 20 axing, building its rather forceful narrative.

“Unfortunately for Mr. Gores and what remains of his Paradigm agency, he forgot that Paradigm had recently entered into a binding oral employment contract with Ms. Klein, under which she could only be terminated for good cause,” the Freedman + Taitleman LLP attorneys shiv the agency boss in the 14-page viscous filing for their well-connected client.

“Given this simple fact, Paradigm stands in direct breach of its employment contract with Ms. Klein, and now owes Ms. Klein the nearly $2 million remaining under the term of her contract,” the paperwork states of the late 2019 deal worked out between Klein and Paradigm. A without paperwork agreement in effect since the start of 2020, at least according to the former’s altered take-home pay.

“Sam Gores hoped to avoid scrutiny by terminating Ms. Klein in the midst of the present pandemic,” the lawsuit says additionally for context, large and small of what is called “the perfect opportunity to effectuate his long-planned, ruthless job cuts.” Among the reasons for Klein’s decades of work at the agency was that Gores was supposedly enraged by her expressed concerns over the illegality of sex workers being procured and paid through company accounts. Even though she had been on Paradigm’s top tier for years, Klein says in the lawsuit that she only found out about the sex on the expense accounts scheme in early 2020 from a pink slipped executive assistant of the boss.

Among the many other Paradigm rocks the suit appears to turn over is an alleged and ultimately unsuccessful strong arming of Klein earlier this year. The plan was to have Klein engage in a conspiracy to pay the agency $500,000 from her salary so Gores “could show Paradigm’s ‘bank’ that its income stream was consistent with his prior representations.” Didn’t go as planned, the suit makes clear.

“His gambit has failed, and Paradigm must now answer for its unlawful acts in a court of law,” the filing from the one time partner summarizes.

Of specific note here, especially under the looming and tragic shadow of the COVID-19 health crisis, Debbee Klein does not appear to have a force majeure clause in her most recent employment contract with Paradigm. Unlike many agents at the company who were cut loose last month to a reality of lost pay, no severance, and health care that now terminates in June, that means Klein isn’t held to having Paradigm’s obligations to her altered or shifted due to unforeseen conditions or circumstances beyond either parties’ control.

Which really means the talent agency that just inked a new franchise agreement with the WGA on March 23 can’t not pay her what they seemingly owe her. It means Paradigm won’t be able keep her hanging on for 90 or so days without pay but unable to seek new work. It also means if Klein was truly tossed out without good cause, she might clean Paradigm’s clock with the spotlight shining accounting and retaliation claims in the new suit too.

This could also be far from the last such suit to batter Paradigm in the coming weeks. Along with chatter of a class action being launched, now ex-motion picture lit agent Adam Kanter has also retained Freedman + Taitelman, I’ve learned – with a clear eye to bringing his own action against Gores and Paradigm in time.

But that is in the possible future. In the right now, Klein’s chief attorney tells Deadline this move is ultimately about more than just her.

“Sam Gores’ firing more than two hundred of his company’s most loyal employees while taking away the full benefit of their health insurance during a world health crisis strains credulity,” Bryan Freedman said in a statement Thursday. “However, taking this knee-jerk action prematurely without offering to reduce his compensation and while keeping his private chef and personal driver on the company payroll, is outright despicable,”noted the lawyer also currently representing Gabrielle Union in her on-going dispute with America’s Got Talent.

“Debbee Klein has taken this action not just for her own benefit, but on behalf of all those Paradigm employees in order to ensure that some measure of justice is done and Gores is made to pay for his iniquitous deeds,” Freedman concludes with little to no ambiguity in an already pretty stark and haunted COVID-19 landscape.

We reached out to Paradigm tonight for a response to the lawsuit and will update if and when we hear from them.

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