Women Workers Posed Nude, Suit Says Some Served As Topless Barmaids At Valley Firm, Ex-Employee Charges

A construction company president used some of the women on his payroll to pose nude for pictures or serve as topless barmaids, a former employee claims in a lawsuit.

Matthew Failing claims those women enjoy special perks at the office of N.A. Degerstrom, Inc., a Spokane Valley mining and construction company.

Failing says he complained about the practice to company officials and wound up getting fired last year because of it.

Now he’s suing Degerstrom for wrongful termination, sex discrimination and outrageous conduct. The lawsuit, filed last week in Spokane County Superior Court, seeks unspecified damages.

On Monday, Neal Degerstrom, president of N.A. Degerstrom, Inc., and his company issued a one-page statement denying the general allegations.

“We have been aware of the unfounded and unsubstantiated allegations of this former disgruntled employee for some time now,” the statement reads.

Failing was fired for “unsatisfactory job performance” and is now retaliating, according to the company.

Spokane attorney Keller Allen, representing the firm, has advised Degerstrom and other company officials not to talk about the case.

“The allegations are so sensational,” Allen says, “we’re not going to lend any credence to them by commenting further.”

Failing claims to have corroborating evidence, including photographs of nude women in the basement of the company offices.

“If the company wishes to expose the evidence, which includes physical evidence for public viewing, I would be happy to provide that,” says Failing’s lawyer, Greg Staeheli.

Employed by Degerstrom for 10 years, Failing, 35, of Spokane was the company’s safety engineer. It was his responsibility, he says, to look into discrimination complaints as they arose.

He was fired last Oct. 14 - two weeks after taking the last complaint to management, the lawsuit states.

For years, parties and photo sessions featuring naked women have taken place in a basement equipped with a conference room, bedroom and fully stocked bar, according to the lawsuit.

The suit names Failing’s ex-wife, a payroll clerk, as one of a few workers willing to pose in sexually revealing costumes - or nothing at all - in front of Degerstrom and other men.

On other occasions, Degerstrom’s clients gathered in the basement, judging “the anatomical parts of naked females in lewdly named contests,” according to the lawsuit.

Those women were rewarded with money, expense-paid trips, leisurely lunch breaks and “little accountability for work production,” the lawsuit states.

Failing also accused Neal Degerstrom of making sexually derogatory remarks in the office and encouraging female employees to pose nude on the company yacht and serve as topless barmaids on company fishing trips.

Failing’s ex-wife claims at least some of the allegations spring from their divorce and ongoing child-custody battle.

“His thing has been to try and embarrass his ex-wife and make life miserable for her,” says the ex-wife’s attorney, Mary Schultz. “Now he’s turning it against the company. This is just the latest chapter in a never-ending story.”

In documents filed in the divorce case, however, a woman claims she and two other female “models” posed nude for Degerstrom in the basement. It is not clear whether those women were employees.

Degerstrom paid each of them $50 to $100 for each 50-minute session, depending on how much flesh they revealed, according to the woman’s affidavit.

The woman could not be reached for comment.

The privately held company was founded by Degerstrom’s father in 1904. It originally built railroads, then moved into dam and highway construction.

As demand for those services declined, the firm moved heavily into open-pit mining operations in Western states.

Last year, the company reported revenues of more than $50 million.

, DataTimes