A Secret Report About a CEO’s Sexual Misconduct Was Just Made Public by Congress

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décembre 22, 2022

Last week, after Zia Chishti filed a defamation lawsuit against the woman whose wrenching Congressional testimony about alleged sexual abuse cost Chishti his job as CEO of the unicorn AI firm Afiniti, Chishti explained himself by saying that “at this stage, I have nothing to lose.”

He may have spoken too soon.

On Saturday, a day after this column reported on the formerly high-flying Washington business figure’s unusual legal move against an ex-employee who testified under oath, the House Judiciary Committee entered a sharply critical 2019 arbitration tribunal ruling about Chishti’s workplace behavior into the Congressional Record — instantaneously turning the heretofore secret report into a publicly-available document.

The release, quietly added to the record of an unrelated hearing on a late-December weekend afternoon, amounts to a tidy Washington-procedural way of saying: Don’t mess with our witness.

As it happens, the document appears utterly devastating for Chishti, a man who not long ago operated from an office a block from the White House and was able to attract politics and government A-listers like former British Prime Minister David Cameron, former French Prime Minister François Fillon and former U.S. Joint Chiefs of Staff Chairman Michael Mullen to Afiniti’s advisory board.

Though Chishti’s federal lawsuit alleges that former Afiniti staffer Tatiana Spottiswoode had “weaponized” a “consensual love affair” by “deliberately lying and misleading Congress under oath,” the report by independent arbitrator Ronald G. Birch reached the opposite conclusion, declaring that Chishti, now 51, had repeatedly sexually harassed an employee half his age, groped her in front of colleagues, insulted her for rejecting advances, brutally beaten her during a business-trip sexual encounter, and lied about it.

The arbitrator awarded Spottiswoode over $5 million, calling Chishti’s conduct “outrageous in character and extreme in degree, going beyond all possible bounds of decency.” The payments, assessed both to Chishti individually and to the company, were made after the ruling was issued.

More relevant to the lawsuit, the ruling also tracks with Spottiswoode’s testimony before the committee last November, during a hearing designed to examine the practice of companies requiring employees to take sexual misconduct complaints to private arbitration instead of the legal system. In part because of Spottiswoode’s testimony, the practice has since been banned.

During that appearance in the Capitol, Spottiswoode presented prepared testimony — later included in Chishti’s lawsuit — that told legislators about a traumatic sexual encounter with the CEO that left her with a black eye, bruises around the neck, cuts all over her body, and symptoms of a concussion. But, she testified, she hadn’t been able to speak out due to the mandatory arbitration requirement in her employment contract.

The testimony led to a rapid exodus of prominent names from Afiniti’s advisory board, and, soon afterwards, to the ouster of Chishti, a former People magazine top bachelor who had previously made a fortune as the founder of the firm behind Invisalign dental braces. Late last month, it led to the lawsuit by Chishti, who forcefully denied the claims.

Now the new revelations have the potential to not just raise questions about Chishti but to cause significant embarrassment in the politics-meets-business ecosystem that incubated many of his VIP investors and supporters — at least some of whom had reason to know about the situation well before Spottiswoode’s testimony.

Suing over allegations made under oath at a Congressional hearing is highly unusual. When we spoke last week, Chishti said his suit against Spottiswoode, her attorneys and several others involved in the testimony was necessary since members of Congress weren’t interested in asking skeptical questions that might have allowed him to tell his side of the story. But critics told me that they worry the suit represents an ominous trend in which the legal system could be used to bully witnesses, yet another disincentive to speaking out against powerful, deep-pocketed people.

What neither side appeared to contemplate, though, was that the act of suing could wind up blowing up on Chishti — adding even more unsavory accusations to the public record of someone whose alleged sexual battery had already been described in graphic detail under oath before Congress.

That’s basically what the arbitrator’s report does — a fact that was surely not lost on outgoing Committee Chair Jerrold Nadler before he inserted it into one of the waning legislative session’s last remaining open hearing records.

“This is retaliation by Mr. Nadler for my challenging the fairness of his proceedings,” Chishti said in an email this week. “One year later, he is once again abusing his power as Chairman of the Judiciary Committee to bully and silence a private citizen without providing any right of response or ability to provide evidence.”

But the arbitrator — following the process mandated by the company Chishti ran — did review copious amounts of evidence and emerged with a remarkably tough document, especially when you consider that forced arbitration is generally seen as more favorable to management than open court. Among other things, the report reveals that Spottiswoode is actually not the only younger female Afiniti employee who received a settlement as a result of similar complaints against the CEO. “While the company settled those claims, which involved some conduct similar to that alleged by Ms. Spottiswoode, it took no steps after that incident to prevent a recurrence of similar conduct in the future,” the report says. “It did not reprimand Mr. Chishti or provide him with any sexual harassment training or coaching of any sort.”

The report also includes a variety of other troubling details that seem to undercut Chishti’s assertion that the relationship between himself and Spottiswoode, the daughter of a longtime business associate, was a true-blue romance that was being mischaracterized in order to hurt him. “It was my impression that Mr. Chishti often created such alternative narratives, and may have come to believe them,” the arbitrator wrote, deeming the CEO a non-credible witness.

Chishti declined this week to address the report. “Unlike my accuser and her attorneys, I will respect my legal obligations around confidentiality and will not comment on the arbitration,” he said by email. (Spottiswoode has not commented on the release.)

Nancy Erika Smith, the attorney who represented Spottiswoode when she testified — and is also a defendant in Chishti’s lawsuit — hailed the release. “The audacity of filing a defamation case knowing that his chosen judge and jury has ruled against him on every single point that he thinks he’s making,” she said this week. “It’s ludicrous.”

Smith, whose previous clients have included Gretchen Carlson in her action against Fox News and Roger Ailes, said the release shows how powerful a tool NDAs and mandatory arbitration are when it comes to insulating corner-office abusers: “This case is an incredible example of how secrecy protects the Weinsteins, the Aileses, the Cosbys.”

Back in Washington, the release of the report is interesting for reasons that go beyond Chishti or even the legal strategies of #MeToo litigation.

During his time atop Afiniti, which uses artificial intelligence technology to power call centers around the world, Chishti cut an interesting figure in the capital, in part because he was an exotic rarity: the Beltway business bigwig who had made his money in the actual private sector, not in some familiar government-adjacent sector like federal contracting. He flew by corporate jet, was introduced around Davos by Britain’s Princess Beatrice, and counted former New Hampshire Senator John Sununu, former U.S. Treasury Secretary John Snow, and former Spanish Prime Minister Jose Maria Aznar as members of Afiniti’s board of directors. Washington Post publisher and CEO Fred Ryan was an early investor.

Then there was the advisory board, run by Cameron and filled with global muckety-mucks able to make introductions and otherwise fly the corporate flag.

It was a neat trade-off, and a familiar one in the capital: The political bigwigs got to be part of something exciting and entrepreneurial; the company got to show off its global reach and connections. But the arbitrator’s report has the potential to be a significant embarrassment — a reminder that retired political types who lend their reputation to a business can take a hit if things go wrong.

“Afiniti did not adequately monitor sexual harassment within the company generally and did not monitor Mr. Chishti’s conduct after Ms. Spottiswoode reported … or even after Mr. Chishti was charged with and settled a sexual harassment claim from another young female Afiniti employee,” the report concludes. “In short, Afiniti negligently abdicated its duty to adequately supervise Mr. Chishti, allowing him unimpeded to place Ms. Spottiswoode in the precarious position she found herself in.” The firm was assessed its own fine of $1 million.

A spokeswoman for Afiniti said this week that the firm, now led by former Verizon President Lawrence Babbio, has undergone major changes since Chishti’s ouster. A former top Justice Department prosecutor was brought in to recommend management changes and examine what had happened. There’s been a lot of turnover.

“The behavior described in the arbitration is intolerable and does not reflect the values of Afiniti today,” the spokesperson said. “In November 2021, we severed all ties with our former CEO. He has had no role at the company since. This is a different company under new leadership. To ensure the safety and welfare of all our employees, we immediately made significant changes, including ending mandatory arbitration for sexual misconduct, strengthening our HR and compliance functions, and improving our reporting mechanisms.”

Another change happened more quietly: After Chishti’s departure, the advisory board was shut down.

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