ICN Chairman Settles Harassment Suit
ICN Pharmaceuticals Inc. and controversial chairman Milan Panic have settled a high-profile lawsuit by a former employee who alleged that Panic had demanded sex from her and fathered her child, a company spokesman said Monday.
The settlement comes less than three years after Panic and the company settled another case filed by a former female employee who alleged that she was the target of advances by the chief executive of the Costa Mesa drug maker. In both cases, the company and Panic said they had done nothing wrong. Terms of both settlements were not disclosed.
David Watt, the drug company’s general counsel, said the recent case, brought by a former secretary, Debra Levy, is “resolved to the satisfaction of both parties.” Panic, who is traveling in Europe, couldn’t be reached for comment.
ICN is one of many companies grappling with employees’ claims that they have been sexually harassed by top-level executives.
Many companies attempt to settle cases regardless of their merits before they reach open court, both out of fear of bad publicity and possible costly judgments, say experts. Lars Jentsch, managing editor of a Costa Mesa-based newsletter that tracks sexual harassment cases, notes that the legal fees alone average about $250,000 when a harassment case goes to trial.
“Companies are willing to pay money to make these go away quickly,” he says.
Watt refused to say why ICN settled the Levy case. Birch E. Bayh Jr., a company director and former U.S. senator, stated that ICN doesn’t condone sexual harassment and that the board considered Levy’s charges “serious.”
He said, however, that the majority of the company’s directors don’t believe Levy’s claims. “Frankly, most all of us thought they were without merit,” Bayh said.
Last year, Levy claimed in a suit filed in Orange County Superior Court that Panic began making unwanted advances when she became his secretary.
Panic also asked her to go on a business trip to Eastern cities that involved meeting with investment bankers and other potential investors, she contended in the suit.
She stated that she was needed to organize presentations and arrange business activities for the trip--and Panic told her that going on the trip would “teach her a lot about the business.”
While on the trip, her suit stated, Panic again sought sex with her. When he became more insistent, she complied. After returning from the trip, she alleges, Panic continued to have sex with her, and she became pregnant, giving birth to a son in 1987.
Three years later, she filed a paternity action against Panic. The case hasn’t been resolved, but Panic began making child support payments to her, Levy claimed in the sexual harassment lawsuit.
In July 1992, Panic went to his native Yugoslavia, where he served as the country’s prime minister until the following March. After he returned to the United States, Levy claims Panic began seeking sex with her again, but she refused. She left the company in October 1994.
When the harassment suit first was filed in January 1995, ICN attorneys accused Levy of retaliating against the company, which had filed a suit accusing her of fraudulently using a company credit card to ring up more than $20,000 in bills before she resigned. The ICN suit against Levy also has been settled, but no details were disclosed, court documents show.
In September 1994, Levy asked the court to declare that Panic is the father of her son and that he should pay support. When the court papers were served, Levy claims that Panic removed her from his office area, she was given no more meaningful assignments, and was terminated a month later.
Levy sought punitive and other damages against the company, as well as an injunction that would require ICN to take “all reasonable steps,” including terminating Panic, to prevent him from harassing female employees.
Watt wouldn’t comment on terms of the settlement, but did say he expected Panic to remain as the company’s top executive. In an interview last week, the ICN attorney said that ICN has a “responsible” corporate policy for handling allegations of sexual, racial or age-related harassment of employees.
For about six years, he added, the company has run a training program for supervisors on the handling of such issues. He wouldn’t elaborate on how the company responded to the sexual harassment claims against Panic. ICN doesn’t comment on “internal” matters, Watt said.
In 1993, former employee Colleen James filed suit alleging that Panic repeatedly made physical advances and lewd remarks, then fired her after she resisted and complained to her supervisor. James started with an ICN subsidiary in 1979 as a $12,000-a-year secretary and eventually advanced to a position of $51,000-a-year trade show manager.
James also claimed that in May that year, Panic came into her office, feigned that her job was in jeopardy, and said that he needed to help her keep it. She alleges that without her consent he grabbed and pulled her against him.
ICN settled with James in 1993.
Both Levy and James claimed in their lawsuits that other female employees had been sexually harassed by Panic. Watt refused to comment on those allegations.
Experts say companies have taken a variety of approaches to handling sexual harassment claims against their executives.
For instance, Dan Wassong, the chief executive of Long Island, N.Y.-based Del Laboratories accused of sexual harassment by 15 female employees, remains in his post. Last summer, the company agreed to pay $1.2 million to settle the complaints. The company has called the charges baseless and said the settlement doesn’t include an admission of guilt.
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Panic’s Problems
1993
* May 25: Colleen James, a former employee, files suit against ICN and Chairman Milan Panic, claiming Panic sexually harassed her verbally and physically. She also charges Panic fired her after she threatened to make trouble over his unwanted advances. Through his attorney, Panic denies he ever harassed James, asserting she is a disgruntled employee trying to coerce money from the company.
* Nov. 19: ICN discloses James’ suit was settled out of court in August; settlement terms not revealed.
1995
* Jan. 31: Another former employee, Debra Levy, sues Panic and ICN, claiming Panic pressured her into sex and fathered her child before forcing her from her job. Panic denies the paternity and harassment charges. ICN attorney suggests Levy suit is retaliation for a suit filed by ICN a day earlier, alleging Levy used company credit card to ring up $20,000 in fraudulent charges before resigning.
1996
* July 1: Levy’s suit settled out of court; terms not disclosed.
Source: Times reports; Researched by JANICE L. JONES / Los Angeles Times
