Top K Street firm rocked by sexism claims

Last updated on June 9, 2024

The story of how Shanti Stanton and Steve Elmendorf formed a decades-long work partnership is a classic Washington tale.

It started on Capitol Hill in 1995: Stanton was a recent college grad and Elmendorf was a top aide to Richard Gephardt, then the Democratic leader in the House. Elmendorf brought her on board and served as her boss and mentor.

Then it moved to K Street: When Elmendorf opened his own lobbying shop in 2007, Stanton became one of his early hires. She worked for him for more than 15 years.

Last year, however, their professional relationship imploded when Stanton and another female senior executive were abruptly fired in what they were told was a cost-cutting move. Stanton and her colleague, Audrey Chang, prepared to sue the firm for gender discrimination and a hostile work environment, among other accusations.

The two women claimed they had been terminated despite being top performers at the firm, then called Subject Matter. The firm declined to comment on its reasoning for the dismissals.

In a draft complaint, they alleged a litany of bad behavior. Elmendorf, a prominent lobbyist and Democratic donor, and Paul Frick, another one of the firm’s founding partners, were named as defendants in the draft lawsuit.

“As one of the first employees of Subject Matter, I watched the firm grow quickly, making tens of millions [of dollars] by marketing their access to senior female and progressive leaders,” Stanton said in a statement to POLITICO prior to settling with the firm. “Yet, women at Subject Matter were never made or viewed as partners in this journey. By contrast, there was widespread discrimination in a boys’ club culture that intimidated and discarded us.”

Steve Elmendorf, a co-founder of Subject Matter, is a well-known Democratic lobbyist and donor.

In her own statement before the settlement, Chang said: “I’ve worked at a number of public relations and public affairs firms in D.C. over the course of 30 years — with many white male leaders — but it wasn’t until I got to Subject Matter that I saw first-hand, and was subjected to, consistent, top to bottom disdain and lack of respect for women, our voices and our contributions.”

Although the two sides settled before a lawsuit was filed, the situation has put a firm that helps big-name clients manage their reputations and advocate for their causes in the uncomfortable position of having to defend its own actions.

The clash is a rare instance of female executives taking on the alleged misconduct of their former employers, and it could signal a cultural shift in the male-dominated world of Washington lobbying. Following her departure, Stanton said that roughly two dozen women detailed to her their “similarly distressing experiences” at the firm, prompting her to speak out.

Still, all but a few former employees of the firm were granted anonymity to speak for this story, fearing retaliation.

A lawsuit threat, then a settlement

POLITICO obtained the 46-page draft lawsuit before last year’s settlement, the terms of which were not disclosed. Though not all of the draft’s claims could be corroborated, interviews with about three dozen former employees of the firm show that Stanton and Chang weren’t alone in their experiences. Twenty-eight of the former employees reported experiencing or witnessing some sexist treatment while at the firm.

Among the complaints from the departed employees: receiving unwanted comments about their appearance, being berated or yelled at by their bosses, having their ideas shut down, and seeing credit for their work taken by men. Some men were advocates for women, but many others “failed upward,” in the words of several former employees.

CEO Nicole Cornish said in a statement that the overarching allegation made by former employees that Subject Matter was a poor workplace for women is “inconsistent with the facts of who we are and the firm we have built.”

“Since 2018, 80 percent of all promotions at the firm have been women,” she said. “Our chief executive officer, chief operating officer, head of talent, 40 percent of our partners and 52 percent of the senior leadership team, are all women. We may be male founded, but we are female led.”

Cornish added in an interview that employees who feel they don’t have a path for advancement, or that their ideas are not taken seriously, “are very real things.”

But she said that experience is not exclusive to women. “I’m not trying to suggest that every single person is going to walk away from Subject Matter having a positive experience,” she said. “I’m simply suggesting that that’s not specific to gender.”

The firm declined to answer other questions for this story.

Subject Matter, which rebranded to Avoq in January, is a one-stop-shop for clients in need of advocacy, advertising, public relations and event services. It’s become a major player in D.C.’s lobbying and PR world, counting blue-chip companies including Amazon, Boeing, Meta and Pfizer as its clients.

In 2022, private equity firm Coral Tree Partners acquired a portion of the firm, and Subject Matter merged with public affairs firm Kivvit last May. The combined firm, Avoq, has nearly $100 million in client fees, according to the industry publication PRovoke Media.

Although Cornish became Subject Matter’s COO in 2017 and CEO in 2021, the firm has been largely managed by the four male partners. In January, Avoq promoted 14 people to partner, including six women.

A breaking point

A majority of women who spoke with POLITICO said the firm’s male leaders have had disproportionate sway and decision-making power, compared to women at senior levels. One of the men is co-founder Frick, who was frequently named in both the draft lawsuit and the interviews for allegedly mistreating women.

One former employee recalled that Frick belittled her female boss during a presentation for a prospective client. That employee, Annie Plotkin, said Frick had pitched the potential client on a public affairs campaign. But the data she and the head of the digital team, Hastie Afkhami, conducted did not support the narrative he’d sold the client.

Even after Plotkin and Afkhami tried to make the research fit what Frick wanted, Plotkin said, Frick “called [Afkhami] out in front of the client,” claiming the data was incorrect.

“I knew that she wasn’t wrong because I had worked on the material that she was talking about,” Plotkin said of Afkhami. “I read it as a breaking point in their relationship because she left pretty soon after that. It definitely turned me off to Paul and working there — that did not feel good.”

Paul Frick, a co-founder of Subject Matter, was named in a draft complaint by two former female executives alleging gender discrimination at the firm.

“What I experienced” at the firm, Plotkin added, “is seeing account managers who are women who are breaking their backs and being regularly reprimanded by Paul. There were men in more senior positions that were celebrated and prioritized and taken more seriously, even when it did not appear to me that they were working anywhere near as hard.”

Afkhami confirmed the anecdote but declined to comment further.

“The second Paul had an opinion about you, it never changed,” a second former employee said of Frick. “So if you messed up on one thing, that was your scarlet letter for the rest of your life there. If you messed up one time, you are more likely to be automatically dismissed for any subsequent thing, even if it’s not even related.”

Frick did not respond to a request for comment.

‘So they wouldn’t see me cry’

In the fall of 2019, Subject Matter conducted a “culture assessment” that measured how employees felt about working at the firm.

According to a slide deck of the results obtained by POLITICO, only 9 percent of women described themselves as “promoters” of the firm. Nearly half the women who responded were “detractors” and the remainder called themselves “passive.” Men at the firm were roughly equally split between being promoters, detractors and passive.

A third former employee said that subsequent surveys were more infrequent and vague in their wording about worker sentiment, making year-to-year comparisons difficult.

The vast majority of complaints POLITICO heard from ex-employees were from people who had experience with Subject Matter’s communications side, run by Frick and Dan Sallick, who did not respond to a request for comment.

One former worker who had a mostly positive experience at Subject Matter still said she noticed a disparity in how men and women were treated. Men were given multiple chances to succeed: If they didn’t work out on a particular client, they would be moved around to another opportunity. Women, in her experience, were not afforded such second chances.

More than a dozen people recounted that men on the public affairs side of the firm were routinely given more opportunities to advance than their female counterparts — while women shouldered much of the work.

“The majority of entry-level employees are young women. To build a firm on the labor and creativity and ideas of young women who then don’t see a clear path for themselves at that firm, to then ultimately prop up the four white male partners — that is what stood out to me most as an unfortunate culture,” one of the former employees said.

Three other former employees said it wasn’t uncommon to see female colleagues crying in the office. One of them said she would see people go into partners’ offices and “would see them leave in tears … it just wasn’t a good situation.”

In one employee’s final review before she left the firm several years ago, she was told by Frick that she was “too vanilla” and that “we have buyer’s remorse from hiring you,” according to two contemporaneous text messages she sent to a colleague and a friend. “I ran out of the room as quick as I could so that they wouldn’t see me cry,” the person said in one of the texts.

This former Subject Matter employee said her lawyer received three calls from a lawyer for Avoq in mid-April telling her that the firm knew she was speaking to POLITICO to give unflattering information about the firm, outreach that she viewed as intimidation.

Chang, in the draft lawsuit, said that men in leadership would push ideas during meetings “regardless of whether they were on track strategically, helped advance goals, or were realistic within client parameters.”

For instance, Kevin Richards, the firm’s chief creative officer, was “often dismissive of women’s expertise, ideas, questions, and contributions,” Chang asserted.

Plotkin described Richards as “a big ideas guy” who would “sit at the table and put his hands behind his head” to talk about how things should be done. “Meanwhile, the female account managers are sitting there trying to think about how that is going to realistically be executed.”

Richards, who was among those promoted to partner earlier this year, did not respond to a request for comment.

‘I trusted you and this is what you do?’

Stanton and Chang wrote in their draft claim that they were terminated despite being among the firm’s top performers.

Stanton alleged that Subject Matter handled her firing in a way that deprived her of equity, compensation and bonuses she had been promised.

She also said Elmendorf pulled a bait and switch, first by convincing her to sell off her shares in Subject Matter amid an investment by private equity firm Coral Tree Partners, with the assurance that she would get equity in the new firm.

In pressuring her to sign the purchase agreement, Stanton claimed Elmendorf said the deal would fall through if she didn’t, adding: “We’re all going to make a lot of money. Please just sign them. We have to get this deal through before Nancy Pelosi isn’t Speaker anymore…”

After she signed the document, Elmendorf made repeated mentions of her future at the firm, she said, including saying he would find ways for her to earn more money.

However, Stanton said the mood shifted in January 2023, shortly after she had renewed all her client contracts. In March, she was called into a meeting and notified she was being let go, following “pressure” from the private equity firm to reduce costs.

She was the only person terminated from the government affairs side of the firm, despite her positive performance reviews and long tenure. “You told me everything was going to be OK,” she said when she confronted Elmendorf, per the draft lawsuit. “I trusted you and this is what you do?”

In the draft claim, she said Elmendorf responded “under his breath” that there had been a “draw out clause” in the purchase agreement she’d signed. Stanton was given nine days’ notice before she had to leave the firm on March 31.

Elmendorf did not respond to a request for comment.

A title bump rebuffed

Chang had a shorter but still substantial history at the firm. She joined Subject Matter in 2018 to launch its strategic communications practice, given the title of senior vice president.

In the draft complaint, she said that she began raising the issue of a lack of gender and racial diversity even before she was hired — pointing out that the four partners running the firm were men and most of the other senior leadership was also male. Chang, who is Asian American, also alleged in the complaint that the firm engaged in racially discriminatory behavior.

Though she claimed that she did not receive a performance review until three years into the job, she said Frick, her boss, gave her high marks. Her team won multiple awards for their work, including one for a campaign created for the 9/11 Memorial and Museum.

But when she asked for a title bump to executive vice president in her 2021 and 2022 performance reviews to reflect the level of work she was doing — and bring her in line with male colleagues — she was rebuffed. Chang was told to wait until the transaction with Coral Tree Partners had been completed, though at least one other man was promoted to executive vice president during this time, she said.

In May 2023, Chang believed that Subject Matter had come to view her as an ally of Stanton and a potential witness to her initial allegations of discrimination.

The following month, Chang and her entire team — one of the most diverse at the firm — were laid off. It came days after she’d pointed out a lack of diversity on a call with Subject Matter and Kivvit leaders, and not long after Stanton sent her demand letter to the firm.

Several former employees told POLITICO they were assured their jobs would be safe following the merger with Kivvit. The team had only been given a week’s notice before they were out of a job, they said.

Some positive marks

Four of the women POLITICO contacted for this story disputed that Subject Matter was a poor place for women to work.

Being a woman did not pose any problems for them to succeed at the firm, they said. One who was on an all-women team said she had a very good experience at Subject Matter. Another said that she didn’t observe women being treated differently in the office, while a third said she left because she didn’t want to work at an agency, not because of any discrimination based on her gender.

“My short time (3 years) there was nothing but positive,” Lisa Cullen, who worked for Subject Matter and a predecessor firm as an account manager from 2014 to 2016, said in a text message. “The company always looked for ways to grow me professionally. I always felt supported by Dan [Sallick] and Paul [Frick], who I have known for more than 20 years.”

But the predominant sentiment among former female employees who spoke to POLITICO — and a few men as well — went in the other direction.

“In this type of work environment, it’s easier to try to avoid the bad actors, look the other way and keep the blinders on, but that is how this mistreatment is allowed to continue,” Chang said before the settlement. “There is tremendous pressure to stay silent. But I also know that it’s not just me, that there are dozens of talented women who have been driven out of Subject Matter.”