Employment discrimination suits can be the source of significant embarrassment and potentially reputational harm for hedge fund managers, even if the allegations are not proven to be true. Furthermore, such suits can sap the morale of firm personnel (particularly those who may be similarly situated to the complainant) and harm the firm’s employee recruiting efforts. It is therefore imperative that fund managers take seriously and proactively address any concerns about discrimination before they reach the courts, which occurred recently when a global private equity fund of funds manager and several of its employees were sued by a former principal/senior employee for discrimination, wrongful termination and defamation. This article discusses the factual background, allegations and requested relief in the complaint. Additionally, the article provides some best practices for fund managers designed to assist them in proactively minimizing risks and damage from employment discrimination lawsuits.