After a upheaval and conflict, OutFest has been sued by its former exec director for defamation, harassment and discrimination.

Damien Navarro, in a lawsuit filed on Friday in Los Angeles Superior Court, claims he warned Outfest’s board of directors, several of whom blamed him for its collapse, of the organization’s dire financial situation but that it refused to take action. He alleges that some board members engaged in a campaign to discredit and remove him as the head of the film festival in retaliation for raising concerns of discrimination.

 

“As the first person of color to lead Outfest, I expected a place of belonging and shared values,” Navarro says. “Instead, I encountered systemic racism, self-dealing, and retaliation that undermined my leadership and the very mission of the organization.”

Outfest denied the “baseless and malicious claims.” It added, “Unfortunately, during Mr. Navarro’s leadership, the Outfest Board decided that it was in the organization’s best interest to bring in new exec director. We remain committed to this decision as the best course of action for the organization and look forward to resolving this matter in legal proceedings.”

It postponed the Legacy Awards, its marquee gala fundraiser that typically saw high profile Hollywood talent honored. This coincided with Navarro, whose contract was not renewed last year, stepping aside for leave of absence, which he says was to allow for “full, unbiased investigation” of concerns of discrimination and harassment that he was allegedly subjected to by board members.

In an email to donors sent in October, Outfest directors said the situation is “dire” while hinting at mismanagement.

“Recently the Board of Directors was forced to take over day to day operations of the organization and we discovered huge amounts of undisclosed debt hidden from the Board,” the message said. “Outfest is in serious financial jeopardy and urgently needs to raise $750,000.”

Navarro inherited an organization with over $250,000 in debt and years of declining membership and ticket sales, which was exacerbated by several unforeseen factors, including the COVID-19 pandemic, increased costs due to new California labor laws and rising venue expenses. Within his first 18 months as head of Outfest, Navarro eliminated the debt and substantially increased revenue, he claims. Still, the organization faced a looming budget deficit ($300,000 by March 2023) and cash flow issues that would necessitate staff layoffs.

But the board elected to “undertake no action despite increasingly dire financial reports,” Navarro alleges. He points to leadership’s refusal to reduce the staff, allegedly to “avoid negative publicity” during the writers and actors strikes. Navarro emphasized the budget crunch with reserves sufficient to cover payroll through May only to be ignored. In a letter to the board he wrote, “Outfest needs to manage its expenses carefully to meet its financial obligations.”

Board members’ duties to the organization include raising or donating at least $10,000 annually to Outfest. Navarro alleges the majority of the board “consistently failed” to meet this threshold, with board member Alexis Fish allegedly refusing to fundraise. Over the past two years, only 30 percent of the board met the minimum requirement, resulting in a budget shortfall of roughly $500,000, the lawsuit claims.

Also are allegations of self-dealing by board members. Navarro says Fish repeatedly attempted to secure exhibitions of films she was directly involved with and had a financial stake in at Outfest, including a documentary about Susan Feniger despite her allegedly being employed as director of business development for the chef. In 2022, Stadler approached him to show a movie in which she was an executive producer at the opening night of Outfest. In response to the overtures, Navarro raised concerns about conflicts of interest.

Executive Director Christopher Racster is the only employee of the organization.

In December, the Los Angeles Times reported that Outfest’s collapse was due to mismanagement by Navarro. Sources that he arranged without the board’s approval for the organization to pay for actor John Waters’ star on the Hollywood Walk of Fame, Navarro says that there was “never an unauthorized deal” and that the agreement was made “transparently with the board’s knowledge.”