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ERIC J. AMDURSKY (S.B. #180288)

eamdursky@omm.com
RYAN W. RUTLEDGE (S.B. #222642)
rrutledge@omm.com
ASHLEY BROWN (S.B. #292870)
abrown@omm.com
OMELVENY & MYERS LLP
2765 Sand Hill Road
Menlo Park, California 94025
Telephone:
(650) 473-2600
Facsimile:
(650) 473-2601
Attorneys for Defendant and Cross-Complainant
Renhui (Maria) Zhang

SUPERIOR COURT OF THE STATE OF CALIFORNIA

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COUNTY OF SANTA CLARA

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NAN SHI,
Plaintiff,

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CROSS-COMPLAINT FOR
DEFAMATION AND INTENTIONAL
INFLICTION OF EMOTIONAL
DISTRESS

v.
Maria Zhang, Yahoo! Inc., and DOES 1
through 10,

[DEMAND FOR JURY TRIAL]

Defendant.

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Case No. 1-14-CV-267855

MARIA ZHANG,
Cross-Complainant,
v.
NAN SHI,
Cross-Defendant.

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-0CROSS-COMPLAINT FOR DEFAMATION AND INTENTIONAL INFLICTION OF EMOTIONAL DISTRESS

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PRELIMINARY STATEMENT
1. The Complaint filed in this action by Nan Shi (Shi or Plaintiff) contains
outrageously false allegations of sexual harassment. Making such extreme false accusations with
the sole intention of causing undue harm is simply inhumane. They destroy the lives of the
people who are wrongfully accused. They not only place unnecessary burden, emotional and
physical distress on the victim, but also on the victims family and friends. Making such false and
outrageous allegations is so unimaginable it raises the question of why anyone would resort to
such extreme measure. In Shis case, the answer is simple: financial gain. Shi made false claims
that Renhui (Maria) Zhang (Zhang or Defendant) coerced her into having sex so that Shi
could extort Yahoo! Inc. (Yahoo) for money. Zhang submits this Cross-Complaint for
defamation and intentional infliction of emotional distress (Cross-Complaint) to redress the
harm caused by Shis attempt to ruin Zhangs professional and personal life for Shis own
financial gain.

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PARTIES AND JURISDICTION

2. At all relevant times, Plaintiff Shi is and was a resident of Santa Clara County,
California. Plaintiff currently resides in Sunnyvale, California.
3. This Cross-Complaint asserts causes of action that Defendant Zhang may properly
bring pursuant to California Code of Civil Procedure section 428.10(a).

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BACKGROUND FACTS
4. Zhang is the founder of a Seattle-based start-up company called Alike. Through Alike,
Zhang created a mobile app for smartphone users that recommends nearby venues that are
similar to ones that users have designated as their favorites. As of February 2013, Alike had five
employees, including Shi.
5. In February 2013, co-defendant Yahoo acquired Alike.
6. As a part of the acquisition, Zhang secured employment offers for herself and her
subordinates at Alike, including Shi, which included significant increases in compensation for Shi
and the other employees of Alike.

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7. Shi began employment with Yahoo in February 2013 as a Principal Software

Development Engineer, at what Yahoo classifies as the IC5 level (which is a senior level
technical position) in the Mobile & Emerging Products division of Yahoos engineering
department.

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8. As a Principal Software Development Engineer, Shi reported on a dotted line to

Zhang but worked on a day-to-day basis under technical leads on Zhangs team.

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9. Zhang, who is employed by Yahoo as Senior Director of Engineering, is in charge of a

large team in the Mobile & Emerging Products division. Zhang supervises the technical leads
under whom Shi worked.

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SHI ATTEMPTS TO SAVE HER JOB BY MAKING FALSE REPORTS

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10. Shi struggled to perform up to company expectations as a Principal Software

Development Engineer at the IC5 level. Shi received negative performance feedback in the third
quarter of 2013 while working under a technical lead, Ben Xing (Xing).

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11. After receiving the negative performance feedback, Shi asked Zhang if she could work
under someone other than Xing. Zhang wanted to give Shi a fresh start so she approved Shis
request and assigned Qichu Lu (Lu) to be Shis technical lead starting in the fourth quarter of
2013.
12. In the first quarter of 2014, Shi continued to struggle with her performance. For
example, Shi had difficulty keeping up with the work load and her low level of productivity was
alarming to Lu. On February 28, 2014, Lu met with Shi to discuss her lack of progress on
assigned tasks.
13. By March 2014, it became obvious to Shi that her job was in serious jeopardy. She
had already received negative performance feedback from one technical lead, Xing, in the third
quarter of 2013 and her new technical lead, Lu, had raised serious concerns with her performance
in the first quarter of 2014.
14. Realizing that consistent negative performance feedback would likely lead to the
termination of her employment and the loss of unvested stock worth potentially hundreds of

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thousands of dollars, Shi attempted to save her job by making complaints to Yahoos Human
Resources department.
15. Shis first attempt was carefully investigated but Yahoo found her claims to be
unsubstantiated. In March 2014, Shi approached Yahoos Human Resources department. She
complained that she did not like being told what to do by Lu. She also complained that Zhang
was a demanding manager. She also stated that Zhang threatened her job.
16. Significantly, however, Shi did not claim during her March 2014 meeting with
Yahoos Human Resources department that she had ever been sexually harassed.
17. Yahoos Human Resources department promptly conducted a thorough investigation
into Shis allegations and found no evidence to support them. Yahoo reported to Shi that its
investigation was closed.
18. As she had done after receiving her initial negative performance feedback, Shi again
requested that Zhang transfer her to a different technical lead.
19. At that point, however, Shi had received poor feedback on her performance under two
technical leads. It was clear that Shi was the problemnot her technical leads.
20. Zhang denied Shis request for a transfer to another technical lead.
21. When Zhang denied Shis request and Yahoo rejected her work-related complaints
after finding no reasonable basis for them, Shi realized that she would not receive another chance
and her termination of employment was likely to be imminent.
22. Shi took drastic measures to ward off her termination. On April 14, 2014, Shi made a
claim to Yahoos Human Resources department that she was forced by Zhang to have sex in
exchange for receiving favorable treatment at Yahooa false allegation of extreme sexual
harassment that never happened.
23. Shi and Zhang never had sex. They never had a sexual relationship, neither forced nor
consensual. Zhang never promised Shi any favorable treatment at Yahoo if Shi engaged in any
sexual activities with Zhang. And Zhang never threatened Shi with any negative job
consequences at Yahoo if Shi did not engage in sexual activities with Zhang. Shi made the entire

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story up in an attempt to save her job and avoid losing hundreds of thousands of dollars in
unvested Yahoo stock. Shi fabricated that lie with absolutely no regard for the truth or the harm
Zhang would suffer as a result of her false allegations. Based on information and belief, Zhang
alleges that Shi has falsely accused Zhang of sexual harassment to numerous third parties.

YAHOOS INVESTIGATION FOUND NO BASIS FOR SHIS FALSE CLAIMS

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24. As soon as Shi reported the claim to Yahoos Human Resources department, Yahoo
immediately initiated a thorough investigation into the allegations that Zhang forced Shi to have
sex with her.

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25. Yahoo interviewed Shi and asked her to provide any support she had for her claims.
Shi was unable to provide a single piece of evidence.

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26. Shi did not have a single witness to support her allegations of an alleged sexual
relationship whether forced or consensual between her and Zhang. Shi claimed to have had a
sexual relationship with Zhang for several months in early 2013, but not a single person who
interacted with them ever observed even the slightest hint of any sexual relationship between
them.
27. Shi did not have a single e-mail, text message, letter, or any other type of
communication to support her allegations of an alleged sexual relationship between her and
Zhang. Despite innumerable communications between Zhang and Shi for more than a year after
the alleged sexual relationship began, not a single communication referenced any alleged sexual
relationship.
28. Shi did not have a single photograph to support her allegations of an alleged sexual
relationship between her and Zhang. Shi claimed to have one, but after being given an
opportunity to produce it, Shi said that she no longer had it.
29. In short, Shi did not have any piece of testimonial or physical evidence to corroborate
her allegations.
30. After careful investigation, Yahoo concluded there was no support for Shis assertion
that there was ever any sexual relationship between her and Zhangmuch less that there was a

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non-consensual sexual relationship. After giving Shi every opportunity to substantiate her
outrageous allegations, and after receiving no substantiation in return, Yahoo closed its
investigation.

SHI BENEFITTED FROM HER FALSE CLAIM; ZHANG WAS HARMED BY IT

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31. Shi received negative performance feedback for the third quarter of 2013 and the first
quarter of 2014.

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32. Ordinarily, Yahoo would have immediately terminated Shi as a result of her consistent
negative performance feedback.

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33. Because Shi raised such serious allegations of sexual harassment and it was important
to fully investigate the matter, Yahoo temporarily refrained from terminating Shi and instead
placed her on paid administrative leave.

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34. Shi continued to receive her salary until June 2014, and to vest stock through July 11,
2014. If it were not for the investigation into her allegations, Shi would have been terminated
much sooner. Yahoo refrained from terminating Shi during its investigation, however, so Shi was
successful in obtaining additional money as a result of her complaint to Yahoo.

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35. On July 11, 2014, Yahoo finally terminated Shis employment.

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36. As a result of making false sexual harassment claims to Yahoo, Shi has already
received hundreds of thousands of dollars that she otherwise would not have received.

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37. In contrast to the windfall Shi received by making false claims of sexual harassment,
Zhang has suffered severe hardship by being falsely accused of coercing Shi into having sex with
her.
38. As a result of Shis false statements, Zhang has suffered injury to her professional
reputation.
39. As a result of Shis false statements, Zhang has also suffered severe emotional distress.
40. Zhang brings this Cross-Complaint to remedy the deliberate harm that Shi inflicted on
Zhang by making false and egregious statements about Zhang for Shis own financial gain.

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-5CROSS-COMPLAINT FOR DEFAMATION AND INTENTIONAL INFLICTION OF EMOTIONAL DISTRESS

FIRST CAUSE OF ACTION

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(Defamation)
41. Zhang realleges and incorporates herein by reference Paragraph 1 through 40,
inclusive, of this Cross-Complaint.
42. Shi harmed Zhang by making numerous false statements regarding Zhang (the
Offending Statements) for the purpose of delaying or preventing the termination of her
employment, including statements:

that Defendant allegedly had oral sex with Plaintiff;

that Defendant allegedly had digital sex with Plaintiff;

that Defendant allegedly had sex with Plaintiff many times;

that Defendant allegedly had a sexual relationship with Plaintiff;

that Defendant allegedly coerced Plaintiff into having a sexual relationship;

that Defendant allegedly promised Plaintiff employment benefits in exchange for a

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sexual relationship; and

that Defendant allegedly threatened Plaintiff with adverse employment actions if

she refused to engage in a sexual relationship.

43. The Offending Statements are false and defamatory. Zhang never had sex or a sexual
relationship of any kind with Shi. Zhang never even attempted to have such a relationship at all
much less promise or threaten anything as part of such an attempt.
44. The Offending Statements are not privileged. Shi did not make the Offending
Statements for any legitimate purpose. Instead, she made the Offending Statements for the
purposes of delaying or preventing her termination and obtaining additional money.
45. The Offending Statements are defamatory on their face. Allegations of sexual
harassment and coerced sexual relations with a subordinate in a work environment directly injure
Zhangs reputation, injure her in her profession, and impugn her character.

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46. The Offending Statements would cause a reasonable listener to believe that Zhang
subjected Plaintiff to sexual harassment, if the statements were true. Thus, they are reasonably
susceptible of a defamatory meaning.

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47. The Offending Statements were published to Zhangs employer, Yahoo, with the
knowledge and intent that Yahoo could take adverse actions against Zhang based upon them.

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48. Shi acted with actual malice and with the intent to cause injury to Zhang, which
entitles Zhang to an award of exemplary or punitive damages. Shi made the Offending
Statements with actual knowledge of their falsity. Shi is well aware that she never engaged in any
sexual activities or a sexual relationship of any kind with Zhang. Shi knew the Offending
Statements were false and would cause severe injury to Zhang. Shi nevertheless made the
Offending Statements for her own financial gain. Shis conduct is despicable and was done with
a willful and knowing disregard of Zhangs rights, subjected Zhang to cruel and unjust hardship,
and misrepresented material facts with the intent to grievously harm Zhang.

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49. As a direct and proximate of Plaintiffs false and defamatory statements, Zhang has
suffered damages in an amount not yet precisely attainable, but which Zhang will establish at
trial.

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SECOND CAUSE OF ACTION

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(Intentional Infliction of Emotional Distress)

50. Zhang realleges and incorporates by reference Paragraphs 1 through 49, inclusive, of
this Cross-Complaint.
51. Shi engaged in extreme and outrageous conduct by falsely accusing Zhang of sexually
harassing her and telling Zhangs employer that Zhang coerced her into having a sexual
relationship. Shis false allegations against Zhang are extremely serious. To fabricate such
claims is truly outrageous. Such false claims are devastating for their victims, like Zhang.
52. Shis false reports to Yahoo were done with the intention of causing emotional distress
to Zhang, or with reckless disregard of the probability of causing emotional distress to Zhang.

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Any reasonable person would know that making false allegations of a coerced sexual relationship
would cause emotional distress to the subject of those false accusations.

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53. As a direct and proximate result of Plaintiffs outrageous conduct, Zhang has suffered
and/or continues to suffer severe shock, humiliation, anxiety, loss of reputation, discomfort,
worry, embarrassment, mental anguish, and other severe emotional and mental distress. Zhang
has suffered damages in an amount not yet precisely attainable, but which Zhang will establish at
trial.
54. Plaintiffs acts were willful, wanton, malicious and oppressive, and justify the award
of exemplary and punitive damages against Plaintiff.

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PRAYER FOR RELIEF

WHEREFORE, Zhang prays as follows:
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For costs of suit and damages in an amount to be proven at trial including

(without limitation) general, exemplary and punitive damages, and for such other and further
relief as the Court may find just and proper; and
2.

An award of reasonable attorneys fees incurred by Zhang due to the frivolous and

meritless Complaint filed by Shi pursuant to California Code of Civil Procedure section 128.5.

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Zhang demands a trial by jury.

<<

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Dated: July 16<, 2014>

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<OMELVENY & MYERS LLP

ERIC J. AMDURSKY
RYAN W. RUTLEDGE>
ASHLEY BROWN

By:
<Eric J. Amdursky>
Attorneys for Defendant and CrossComplainant<> Renhui (Maria) Zhang <>>>

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