CSC Generation Lawsuit: Allegations, Response, and Outcome

The most prominent CSC Generation lawsuit was a 2020 pregnancy discrimination case filed by two One Kings Lane employees who alleged they were furloughed because they were pregnant and about to take maternity leave. The case settled in April 2021 on undisclosed terms and was dismissed with prejudice. CSC Generation denied the allegations throughout.

Who Sued and Why

On August 27, 2020, Katherine Marinaro and Whitney van der Does filed suit against One Kings Lane, CSC Generation Holdings, and CEO Justin Yoshimura in the U.S. District Court for the Southern District of New York, docketed as Marinaro et al. v. CSC Generation Holdings, Inc. et al., No. 1:20-cv-06939.¹ A parallel complaint went to the EEOC in New York.²

Marinaro worked as a director of integrated marketing. Van der Does was an interior designer. Both were in their third trimester when CSC Generation completed its acquisition of One Kings Lane from Bed Bath & Beyond in April 2020. According to the complaint, about a week after the deal closed, both were furloughed indefinitely and without warning, and both were the only employees selected from their respective teams. The complaint described the colleagues who kept their jobs as lower-performing and lower-earning.²

The Core Allegations

The suit brought claims of pregnancy discrimination, gender discrimination, interference with rights under the Family and Medical Leave Act, and retaliation.³ The plaintiffs alleged that after the acquisition, CSC Generation told them their eligibility for maternity leave and FMLA protections had been “cut off by the change in corporate structure.” Under Bed Bath & Beyond, One Kings Lane had offered up to 14 weeks of paid maternity leave.²

When Marinaro asked HR about her benefits, the complaint said, a representative consulted the executive board and then told her the company “would not pay for maternity leave period.” The complaint alleged the representative laughed during the exchange.⁴ Marinaro also alleged she had been passed over for a promotion to senior marketing director in December 2019 because leadership believed “work-life balance” was less of a priority for a different candidate, framing the comment as evidence of bias against a pregnant employee with children.²

The plaintiffs alleged the furloughs were carried out under the “false pretext” of a COVID-19 downsizing and were actually intended as permanent terminations tied to their pregnancies and upcoming leaves.⁵

The Reinstatement Offers

After the plaintiffs retained counsel and raised discrimination complaints, CSC Generation offered to bring them back. The complaint characterized those offers as tactical. Van der Does was told on Saturday, June 27, 2020, to return the following Monday. Marinaro was told on a Wednesday to report the next day. Both women had recently given birth and were caring for newborns.⁴ The reinstatement offers also allegedly came with fewer weeks of leave and lower pay than the women had originally been promised.⁵

What CSC Generation Said

The company denied the discrimination allegations. General Counsel Preetam Shingavi and One Kings Lane President Mo Afzal said 30 employees across the company had been furloughed because of the operational disruption caused by the pandemic, and that the decisions were driven by the financial impact of COVID-19 rather than any employee’s pregnancy status.²

How the Case Ended

The case resolved roughly eight months after it was filed. On April 16, 2021, Judge Paul G. Gardephe signed an order of discontinuance noting that all claims had been settled, and the action was dismissed with prejudice and without costs.⁶ Financial terms were not publicly disclosed.⁷

Other Legal Matters Involving CSC Generation

The Marinaro case is the most prominent lawsuit publicly tied to CSC Generation, but the company’s acquisition-heavy model has produced other legal friction worth knowing about.

The DirectBuy Franchise Dispute

In Buy Direct, LLC v. DirectBuy, Inc. (No. 2:15-CV-344, N.D. Ind.), a successor entity that had changed its name from CSC Generation, Inc. to DirectBuy Home Improvement, Inc. was named as a counterclaim defendant in a long-running franchise dispute. On September 6, 2024, the court granted the motion to dismiss, ruling that the successor entities could not be held liable under the applicable successor liability theories for conduct related to franchise and asset purchase agreements dating to 2014.⁸

Rejected Takeover Bids for Bassett and Flexsteel

In late 2022, CSC Generation drew industry attention for two aggressive public takeover attempts aimed at publicly traded furniture manufacturers. After privately approaching Bassett Furniture three times between June and October 2022, CSC went public with an all-cash offer of $21 per share, or roughly $191 million, a 27 percent premium over Bassett’s recent closing price. Bassett’s board, led by chairman and CEO Robert H. Spilman Jr., rejected all three proposals, calling them “highly opportunistic” and arguing they “substantially undervalue the company.”⁹

SEC records show CSC had filed a Schedule 13G in June 2022 disclosing a 7.4 percent stake in Bassett, amounting to 761,443 shares. The filing certified that the shares “were not acquired and are not held for the purpose of or with the effect of changing or influencing the control of the issuer,” though CSC later pursued its public bid. Yoshimura held sole power to direct the vote and disposition of those shares.¹⁰ CSC sold the majority of its Bassett shares shortly after the failed bid.⁹

CSC made a similar unsolicited offer for Flexsteel Industries at $20.80 per share, which that company’s board also rejected. Trade publications labeled Yoshimura a “buyout bully.” He defended the approach, arguing that certain boards operate as “fiefdoms” rather than acting in shareholders’ best interests.¹¹ Neither bid produced a proxy fight or formal legal action, according to available reporting.¹²

1
Law360. One Kings Lane Workers Allege Pregnancy Bias in New Suit
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Business Insider. One Kings Lane Employees Allege Pregnancy Discrimination Against CSC Generation
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HR Dive. One Kings Lane Workers Allege Furloughs Were Based on Pregnancy
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LegalReader. One Kings Lane, CSC Generation Hit With Lawsuit Alleging Pregnancy Discrimination
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Wigdor LLP. One Kings Lane CSC Generation Pregnancy Discrimination Lawsuit
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UniCourt. Marinaro et al v. CSC Generation Holdings, Inc. et al
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Law360. Interior Design Co. Employees Settle Pregnancy Bias Suit
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CaseMine. Buy Direct, LLC v. DirectBuy, Inc.
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Furniture Today. Bassett Furniture Rejects CSC’s Buyout Proposal
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StreetInsider. Form SC 13G – Bassett Furniture Industries Filed by CSC Generation Holdings
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Business of Home. CSC Generation Is a Billion-Dollar Home Brand. Why Haven’t You Heard of It?
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Business of Home. CSC Generation Attempts Takeover of Bassett Furniture