Blockchains CEO, wife face sexual harassment lawsuit from former Lake Tahoe-area nanny

Nevada News
Jeffrey Berns, founder and CEO of Blockchains, poses for a portrait at their corporate headquarters east of Reno on March 2, 2021.

Jeffrey Berns, the tech CEO asking the Nevada Legislature to let him form his own government in Storey County, has been sued by a former nanny who is accusing Berns and his wife, Mary, of trying to groom her “to participate in three-person sex” with the couple, according to court documents obtained by the Reno Gazette Journal.

The woman, 45-year-old Rebecca Eller, said the couple lured her into employment as a tutor for their daughter, offering her a high salary, medical benefits and free living accommodations on their property. It soon became clear, she alleged in the lawsuit, that the couple expected her to be a “sexual object” for them and subjected her to an environment that was “sexually pervasive, degrading and insulting.”

According to the lawsuit, when Eller refused the couple’s advances and quit, Jeff Berns attempted to use his wealth and influence to then sabotage her re-employment at the Incline Village private school they had initially recruited her from.

“Eller was subjected to work expectations not remotely suggested by the job description that she had been given, expectations of her being a sexual object to the defendants,” the lawsuit said. “Rather than plaintiff’s duties being limited to the duties of a ‘nanny,’ ‘tutor,’ and ‘personal assistant,’ it became clear that her duties included being sexually attired eye candy for the defendants in an environment pervaded by sexuality.” 

In an unsuccessful motion to dismiss the case, Kent Robison, the Berns family’s lawyer, denied the couple engaged in any inappropriate behavior with Eller.

“The Berns adamantly dispute plaintiff’s allegations and claims,” Robison wrote.

Read the Eller’s second amended complaint here: 

Berns denies the allegations amid high-profile campaign at the Legislature

In a written statement to the Reno Gazette Journal, Jeff Berns called the allegations ludicrous and offensive. 

“A former disgruntled employee has chosen to make false claims in a public forum for financial gain,” he said in a statement. “Considering this absurd lawsuit was filed nearly eight months ago, the timing of this being pushed to the media during the Nevada legislative session is not a coincidence. I will vigorously fight these attempts to extort me and malign my family.”

Berns, the CEO of Blockchains Inc., is in the middle of an expensive campaign to convince the Nevada Legislature to allow him and other tech companies to create their own local governments in the state. The proposal, dubbed the “Innovation Zone” bill, already has the backing of Gov. Steve Sisolak, who highlighted Berns and the Innovation Zone proposal in his state of the state address earlier this year.

Read the defendants’ reply supporting a motion to dismiss here: 

Eller’s lawsuit is not the first complaint brought against Berns, who told the Reno Gazette Journal he paid a settlement to a former business partner who had accused him of sexual harassment in the mid-2000s. Details of that complaint are not available.

Judge David Hardy sealed most of the records in the case

In an unusual move, the judge presiding over Eller’s lawsuit agreed Monday to Berns’ request to seal most of the documents in the case, including the entire initial complaint filed on Sept. 14, 2020.

Washoe District Court Judge David Hardy described his decision as “highly unusual,” but argued it was necessary because of the “immaterial, scandalous and impertinent” content that was filed by Eller’s lawyer, Cal Dunlap. 

“This court does not seek to protect the defendants’ privacy from allegations they will consider embarrassing, though this court must limit embarrassing content to what is legally relevant and permissible,” Hardy wrote.

Read Judge Hardy’s Order Addressing Motions to Seal and Dismiss: 

In that same order, Hardy denied Berns’ motion to dismiss the lawsuit.

Dunlap declined to comment on the case. Dunlap, who is a former Washoe County District Attorney, has represented victims of sexual assault, most notably a woman who settled with Pittsburgh Steelers quarterback Ben Roethlisberger after she accused him of raping her at a Lake Tahoe resort in 2008. Dunlap also represented former First Lady Dawn Gibbons in her 2008 divorce from then Nevada Gov. Jim Gibbons.

Despite most documents being sealed in the case, Eller’s allegations are spelled out in a second amended complaint that Hardy ordered to be slightly redacted. Information deleted from that document include Mary Berns’ former aliases and specific wording describing one of Eller’s complaints.

Lawsuit: Berns offered Eller high salary, benefits, housing to tutor daughter

Here’s what led to the lawsuit, according to court documents that weren’t sealed.

From March 2017 through July 2018, Eller, a Colorado transplant, worked as a part-time tutor and substitute teacher. With no Nevada teaching license, she couldn’t get a full-time teaching job in a public school, but she eventually got a job at a private school in Incline Village, according to the complaint. 

Eller privately tutored Incline Village students, including the daughter of Jeff and Mary Berns. Two times a week, she visited Berns’ Lakeshore Boulevard home. 

In July 2018, the Bernses began recruiting Eller to be a household “nanny,” inviting her to dinner to discuss terms of employment.

During dinner, the married couple offered Eller a full-time job as their daughter’s nanny and private teacher — and she would also be Mary Berns’ “personal assistant.”

Jeff Berns insisted that Eller move into a house at nearby Snug Harbor so she would be “close and easily accessible,” the complaint said.

The Blockchains boss asked how Eller’s husband would feel if she lived next door, according to the complaint. At the time, Eller told them she was in the process of getting a divorce. 

“This is the perfect opportunity for you!” Jeff Berns said, according to the complaint.

Eller told Berns her last salary as a Colorado teacher was $58,000. The multi-millionaire thought for a moment, the complaint said. He offered her $75,000 a year with medical benefits, and she would live next door at no cost. 

Eller signed employment letter from Blockchains Inc.

Eller accepted the offer. Jeff Berns instructed Eller to go to Blockchains’ Sparks headquarters to sign a written employment agreement.

A human resources representative from Berns’ company handed Eller an official letter offering her a position as “nanny to the Berns family,” the complaint said.

Eller would report to Mary Berns, the letter said.

The future nanny signed the letter — as well as a confidentiality and non-disclosure agreement related to the Blockchains enterprise. A separate document authorized them to investigate her.

Berns tells Eller to just do ‘whatever Mary asks you to,’ complaint said

On Aug. 1, 2018, Eller moved into Berns’ house with her two dogs. 

Jeff Berns privately told her it would be the last job she would ever need, the complaint said, “if she just did ‘whatever Mary asks you to.’”

Eller started her new career, but she soon felt the job did not match the description. She felt she was actually there to be “a sexual object,” the complaint said.

Mary Berns gave sexual compliments and demanded that Eller wear “form-fitting clothes so as to better show off her figure,” the complaint said. She suggested getting a hotel room and asked the nanny to indulge Jeff Berns “with back and shoulder rubs.” 

Jeff Berns leered at Eller, the complaint said, and at one point she was “swatted by him on one cheek of her buttocks, proclaiming, ‘You have a great figure!’”

The work environment was “sexually pervasive, degrading, and insulting, especially to a young woman whose self-image was as a schoolteacher,” the complaint said.

Complaint alleges Mary Berns harassed Eller

Then, on Oct. 8, 2018, Mary Berns sexually harassed Eller, according to the complaint. 

After a two-hour hike with Eller and her dogs, Mary Berns took the nanny to lunch at the Edgewood Golf Club. On the outdoor patio, the boss insisted they drink champagne.

Mary Berns then asked – in a serious tone, the complaint said –  if Eller had ever been with another woman. Eller became uncomfortable. 

Mary Berns became irritated, according to the complaint, and persisted: “Would you ever try it?” she said. “Occasionally, Jeff likes another woman to join us in the bedroom… I like it, too.”

When Eller didn’t appear receptive to her entreaties, Mary Berns “became condescending, distant, and hostile,” the complaint said.

Eventually, Eller couldn’t tolerate “the pervasive abuse,” the complaint said. She quit.

“I’m sorry,” she said. “I’m not the person you need for this position.”

Complaint alleges Berns tried to sabotage Eller’s next job after she quit the nanny position

Eller reached out to the head of the private school where she had previously received a job offer to be a full-time science teacher. She asked if he had any full-time openings. She was hired on the spot, the complaint said.

Soon, however, it became clear Jeff Berns talked to the principal, who questioned Eller about her departure from her job as nanny, the complaint said. Eller contends in the lawsuit that Jeff Berns misled the principal and omitted the actual reasons she left the job.

Jeff Berns was retaliating, she alleged, by attempting to use his wealth and influence at the school to sabotage her employment. Berns had told her in past conversations that he had donated over $1 million to the school, the lawsuit said. 

Eller alleged the couple sought revenge because she refused to engage in sexual acts with them. She felt “stalked” by Jeff and Mary Berns and feared the treatment would continue to her detriment, the complaint said.

The former nanny is now seeking more than $150,000 in damages, the complaint said, due to severe emotional distress, embarrassment, humiliation, pressure and shame Eller suffered after meeting the Bernses.

The lawsuit claims fraud, conspiracy, intentional and negligent infliction of emotional distress, invasion of privacy, battery (for the alleged swat on the buttocks), interference with contractual relations and stalking. Judge Hardy dismissed the claim of stalking.

Ed Komenda writes about Las Vegas for the Reno Gazette Journal and USA Today Network. Do you care about democracy? Then support local journalism by subscribing to the Reno Gazette Journal right here

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