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How does tech industry treat women? Discrimination case could expose details.

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Marcio Jose Sanchez/AP/File

(Read caption) In this 2006 photo, Kleiner Perkins Caulfield & Byers senior partner John Doerr poses for a portrait with partner Ellen Pao outside their office in Menlo Park, Calif. A jury is hearing opening arguments in a multimillion-dollar sexual harassment lawsuit filed by Ms. Pao, interim CEO of the news and social media site Reddit, against the prominent Silicon Valley venture capital firm.

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Opening statements were being held Tuesday in a high-profile case that is expected to expose details of how the tech industry treats women.

The case pits Kleiner Perkins Caufield & Byers, an influential investment firm that has backed big tech companies such as Google and Amazon, against a former junior partner, Ellen Pao. Ms. Pao, who is now the interim chief executive officer of the social media company Reddit, accuses the firm of gender discrimination and says she was denied a promotion after she complained about harassment by a male partner.

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By now it is widely accepted that tech companies have a gender problem. Only about 30 percent of employees at big technology companies are female, and a Newsweek article last month described the culture in Silicon Valley as “savagely misogynistic.” Now the question is whether this case will make employers in the industry rethink the way women are treated in the workplace or whether it will do little to change the status quo.

“The proceedings could resonate widely: A finding of liability will be seen as a vindication of women’s complaints about the high-tech world; failure of the suit might supply ammunition to those who feel gender issues are being overplayed,” writes David Streitfeld in The New York Times.

Some are hoping that the case will be a wake-up call for companies in the tech industry. Anything that gets people talking about the issues is important, says David Leighton, president of Women in Technology International (WITI), a Los Angeles-based organization that supports women in the tech sector.

Kleiner Perkins Caufield & Byers "has been one of the top firms in Silicon Valley. If they really get it and start to make changes, that could make a difference,” Mr. Leighton says.

The attempts that tech firms have made for more inclusiveness in the workplace haven't always been well received, he notes.

“All of these companies are investing suddenly in diversity, giving managers incentives to hire women, but it alienates everyone when you approach it in a numbers-driven way. Why would a woman want to be hired because the man will get a bonus to hire her? It creates a bad environment," Leighton says. "Companies need to begin to leverage gender differences in the workplace and realize that hiring women is good for business.”

Still, while the issues are being battled in court, women are leaving the tech industry, points out the leadership at WITI. A 2014 report from the Diana Project, a research effort on female entrepreneurs, found that the total share of female partners at venture capital firms had declined to 6 percent from 10 percent in 1999. "So far, no [tech] company has found a solution for retaining women," writes Tracey Lien in a Los Angeles Times article.

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In court filings, Pao said that her status at the firm deteriorated after she ended an affair that she had been pressured into with a married partner who has since also left the firm. She said she was denied raises and a promotion after he and the firm began retaliating against her, according to Reuters, which cited the court filings.

The company says that Pao’s performance did not merit a promotion and that there was no discrimination involved in the decision not to promote her.

In court filings, the firm signaled it would portray Pao as one caught up in office drama. "For some reason, there's always some team controversy swirling around Ellen," one of her annual reviews stated, according to the filings, as reported by the Associated Press.

The trial, which is taking place in San Francisco Superior Court, is expected to last a month.

The case has already brought widespread attention to the gender issue in Silicon Valley and trailblazed a path for other lawsuits. After Pao filed her suit in 2012, female employees at several other venture firms filed similar cases that were eventually settled. 

Now, many say that Pao’s suit could be a big deal.

“I think it could have a huge impact,” said Traci Hinden, a San Francisco attorney who represents employees in discrimination cases. A half century after passage of the federal Civil Rights Act, and six years after Congress passed the Lilly Ledbetter act to help women sue for wage discrimination, “equal pay and equal advancement for women are not being shown,” Ms. Hinden told the San Francisco Chronicle.