The San Juan Daily Star
November 20-22, 2020
11
Second Epstein investigation begins at Victoria’s Secret, but what’s changed? By SAPNA MAHESHWARI, KATHERINE ROSMAN, JESSICA SILVER-GREENBERG and JAMES B. STEWART
I
t has been more than a year since L Brands, owner of Victoria’s Secret, said it was hiring a law firm to investigate its billionaire founder Leslie Wexner’s close ties to the convicted sex criminal Jeffrey Epstein, but no findings have been made public and the review has seemed to fade from view. Maybe a new law firm will fare better. After Epstein’s July 2019 arrest, revelations about his sweeping power over the retail magnate’s fortune and how he may have used his link to the lingerie giant to prey on women prompted the company to swiftly declare that it had hired lawyers to conduct a “thorough review” of the matter. The company enlisted Davis Polk & Wardwell, the whiteshoe law firm that it had relied on for legal counsel for years, and which once employed Wexner’s wife, Abigail. But nothing about the scope of the investigation has been released since, and many former Victoria’s Secret employees, including two who had interacted with Epstein, said they were never contacted by lawyers. Now, a second inquiry has begun at the company. A shareholder lawsuit filed in May suggested Davis Polk was too close to L Brands to be truly independent. The shareholder said they asked the board in February to replace Davis Polk or hire another firm as a “check” for its review of Wexner and Epstein’s relationship. Last month, at least five current and former Victoria’s Secret employees were surprised to hear from a new lawyer with no affiliation to Davis Polk. Sarah Eddy, a partner in the litiga- A boarded-up Victoria’s Secret store in New York on July 29, 2020. Victoria’s Secret was set to be sold to a tion department of Wachtell, Lipton, Rosen & Katz, said she was private-equity firm this year before the pandemic scuttled those plans. commencing a separate investigation on behalf of two independent L Brands board members: Sarah Nash, who became its on its management and the board of L Brands, which also owns tion to address the company’s workplace culture. Bath & Body Works. In February, L Brands announced a plan to sell a majorichairwoman this year, and Anne Sheehan. Wexner, 83, has sought to distance himself from Epstein, ty stake in Victoria’s Secret to the private-equity firm Sycamore In an email obtained by The New York Times, Eddy said her firm was investigating “allegations raised in shareholder who died in prison last August in what was ruled a suicide. But Partners, whittling the public company down to Bath & Body demand letters and civil complaints concerning, among other L Brands has also faced intense scrutiny about its workplace en- Works. Once the sale closed, Wexner planned to step down as things, connections between L Brands and Jeffrey Epstein.” The vironment. An article by The Times in February showed that CEO and chairman of L Brands but remain on its board. Then the pandemic hit, dealing an outsize blow to mall former employees, who spoke on the condition of anonymity Wexner and his former chief marketing officer, Ed Razek, prechains, especially apparel sellers, and Sycamore backed out of sided over an entrenched culture of misogyny, bullying and haciting fear of retribution, all said they had received similar calls the deal after some legal wrangling. In May, there was a marassment at L Brands and Victoria’s Secret. and emails. Shareholder complaints have also raised concerns Wexner stepped down as CEO and chairman of L Brands nagement shuffle at Victoria’s Secret and Bath & Body Works, about allegations of misconduct and a culture of harassment and misogyny at L Brands and its lingerie powerhouse, suggesting in May, but nearly all of Victoria’s Secret’s remaining top leaders which are still being run as separate companies within the publiare men he hired or promoted, including the brand’s interim cly traded L Brands, and Nash replaced Wexner as board chair. that the new investigation could be looking into those issues. Nash, a former executive at JPMorgan Chase and CEO of CEO, who was appointed to that role despite an extramarital Wexner and his wife remain on the board but three directors Novagard Solutions, and Sheehan, an expert in corporate gover- affair with a subordinate that became widely known inside the retired, including a former Ohio State president as well as two nance, joined the L Brands board last year after an activist inves- company. The scarcity of women in the highest ranks of the who had served for more than three decades. Morale has been low in a difficult year that has included tor pushed for more diversity and fewer directors with business company has frustrated some employees. hundreds of layoffs in New York and Columbus, Ohio tied to “This year, we have amended our board governance, made and social ties to the Wexners. the pandemic. significant policy changes, initiated a robust diversity and incluEddy declined to comment. A representative for Davis While L Brands’ shares soared 92% this year through sion strategy, and greatly enhanced associate communication,” Polk did not respond to requests for comment. The new investigation is the latest jolt for L Brands and Nash said in a statement. “It’s truly a new day for L Brands and Monday, they remained 64% below a 2015 peak. On Wednesday, L Brands reported net sales for the quarter Victoria’s Secret, and comes months after the pandemic foiled a I’m excited about the progress we continue to make for our assothat ended Oct. 31 had increased 14% to $3 billion, driven by ciates, customers and communities we serve around the world.” plan to sell the lingerie brand to a private-equity firm. Even befothe performance of Bath & Body Works. The company swung to She said she was proud that half its board was now women. re the revelations about Epstein, Victoria’s Secret was battling a a net profit of $331 million in the period, compared with a $252 Two current employees said they were cautiously optimisdecline while facing criticism that its lingerie-clad models were million loss a year earlier. tic that Wachtell’s independence could allow the new investigaout of step with current views of beauty. That put fresh attention