Legal and Management

Recording Academy & Suspended CEO Deborah Dugan Begin Settlement Negotiations

Deborah Dugan
Courtesy Photo

Deborah Dugan

The two parties entered mediation on Thursday after Dugan was placed on administrative leave on Jan. 16.

The Recording Academy and its suspended CEO, Deborah Dugan, entered mediation on Thursday (Feb. 20) to negotiate a settlement, sources tell Billboard.

Dugan, who worked as CEO for roughly six months, filed a discrimination complaint with the Equal Employment Opportunity Commission (EEOC) on Jan. 21 against the academy, after she was placed on administrative leave on Jan. 16 -- just 10 days before the 62nd annual Grammy Awards -- amid allegations of workplace bullying.

Dugan and the Recording Academy initially tried to settle their dispute quietly. The Recording Academy alleged that talks broke down after Dugan reportedly asked for $22 million. The academy countered with a multimillion-dollar offer -- around $8 million -- two sources tell Billboard, but Dugan turned it down. Talks continued after she was placed on leave, sources say, but no resolution could be found.

"They are definitely trying to mediate it as they probably should have from the beginning to avoid all this," a source tells Billboard. Another source says Dugan's attorney initiated the mediation talks.

In Dugan's EEOC complaint, she said she sent an email to the academy's managing director Shonda Grant on Dec. 22 alleging sexual harassment, "egregious conflicts of interest, improper self-dealing by Board members and voting irregularities with respect to nominations for Grammy Awards." She said the behavior was made possible by the organization's "boys' club mentality and approach." The Recording Academy has refuted her accusations, particularly those pertaining to alleged voting irregularities.

Dugan also alleged that she has been subjected to sexual harassment by Joel Katz, the academy's outside general counsel and a former member and chair (1995-97) of the academy's board of trustees. Katz has denied the claims. She also says in May she was asked by outgoing board chair John Poppo to hire former academy CEO Neil Portnow as a consultant at a $750,000 annual salary -- a request Dugan denied. She also said that although she had been asked to take over Portnow's position, she was being paid substantially less than her two male predecessors, Portnow and Mike Greene. (Sources with knowledge of her deal tell Billboard that to arrive at her starting salary, the organization took Portnow's beginning salary of $500,000 and indexed it to today's dollars, approximately $720,000.)

Last month, Dugan asked the Recording Academy to release her from the arbitration agreement she signed when she joined the nonprofit organization in August 2019. But the Recording Academy denied Dugan's request. The Recording Academy was, however, willing to waive its confidentiality provision -- meaning the process could play out publicly.

Employment lawyer Victor George, who is not affiliated with the case, says Dugan brought her discrimination claims first to the EEOC because California law requires one "exhaust all administrative remedies" before filing a civil lawsuit. However, George says EEOC investigations are typically "very, very slow" and it is not unusual that during the process for the other side to reach out and suggest mediation with a neutral party. George says if a settlement is reached the language would typically include a clause that would ask that Dugan move to withdraw her EEOC complaint.

"If you are the plaintiff, you are always in control of the destiny of the complaint," George adds. "So if you decide you don't want to pursue the EEOC complaint anymore, you simply just let them know."

Neither the Recording Academy nor Dugan's reps responded to request for comment.

Additional reporting by Melinda Newman.