Company funds used for prostitutes, alleges ex-partner at Paradigm Talent Agency

An ex-partner of Paradigm Talent Agency is alleging in a lawsuit that she was fired by the company after she raised questions about the company’s accounting practices and inappropriate conduct by its CEO Sam Gores.

Debbee Klein, a former agent and partner at Paradigm who worked at the agency for more than 23 years, on Thursday sued her former employer for breach of contract in Los Angeles County Superior Court.

Klein alleges in a complaint submitted to the court that she was ousted from the Beverly Hills agency after she confronted Gores about questionable accounting practices, including the use of company funds to allegedly pay for prostitutes and other personal expenses.

“Plaintiff learned that Mr. Gores had forced his executive assistant to hire prostitutes to service him and others, and that Mr. Gores had directed his executive assistant to pay for these prostitutes through Paradigm’s bank account,” the suit states.

Klein also said in her lawsuit that Gores asked her to loan him $500,000 so that Paradigm’s financial books would look better for its bank and offered to pay her back. Klein said she refused.

She contends that Paradigm broke her contract by firing her without cause, and is seeking more than $1.8 million in damages.

Paradigm’s attorney Dale Kinsella called Klein’s complaint “littered with false, frivolous and scurrilous allegations.”

“Both Paradigm and Mr. Gores expect to be 100% vindicated, and our intention is to respond further in court filings,” Kinsella said in a statement.

Klein was among 250 staffers laid off last month, as Paradigm and other talent agencies responded to the novel coronavirus that has devastated the entertainment industry.

Paradigm said it would temporarily lay off employees, with hopes of rehiring them no more than six months later. At the time of Paradigm‘s announcement, people close to the company said the number of layoffs was more than 100; after former employees pushed back, Paradigm revealed that the layoffs totaled 250 people.

Former employees were angry that the company at first said it would only pay their insurance through April. Following complaints, the company agreed to extend their health insurance to June.

In an interview with the L.A. Times last week, Gores said that the 250 people affected by the layoffs did not receive severance because they were not terminated. The company has used a force majeure provision in its employee contracts, citing the coronavirus as a reason for suspending compensation while the employees are laid off.

In her lawsuit, Klein says Gores kept his private chef and personal driver on the company’s payroll after he laid off hundreds of employees.

She also accused Gores of lying to the agency’s business partners about other aspects of the company.

Last year United Talent Agency attempted to buy Paradigm, but the deal fizzled. Klein says in her lawsuit that Gores did not inform business partners X-Ray Touring and Coda Agency about selling Paradigm to UTA until June 7, 48 hours before the deal with UTA was set to close. Gores had already signed a document agreeing to the merger subject to certain conditions, the lawsuit said.

Klein has represented clients such as Marc Cherry, creator of the series “Desperate Housewives” and Eric Tuchman, executive producer of the Hulu drama “The Handmaid’s Tale.”