A.B. Fischer hit his former agency, The Shuman Co., with a suit claiming the “reckless” decision to hire a talent agent who had been accused of sexual misconduct sent the company into a “death spiral” — and hastened his departure.

Fischer, who is being sued by Shuman for breach of contract, filed a counterclaim in state Superior Court demanding back wages, damages and legal fees.

At issue was founder Larry Shuman’s decision to hire Erik Horine, a well-connected agent in ICM Partners’ television lit department who departed from the agency amid reports that he ran afoul of the agency’s zero-tolerance policy on sexual harassment. Fischer’s complaint alleges Horine’s reputation for making inappropriate sexual advances toward female employees was an “open secret” in the entertainment industry.

“For months, Mr. Fischer implored Mr. Shuman not to hire Mr. Horine because Mr. Horine’s employment by the company would make the company’s other employees, particularly the female employees and clients, uncomfortable and because the company’s association with Mr. Horine would damage the company’s reputation,” Fischer claims in the suit filed last week (read it here). “For reasons only Mr. Shuman could explain (but never did), Mr. Shuman ignored Mr. Fischer’s warnings.”

Fischer called Shuman’s decision to hire Horine in August 2017, a period of gathering awareness about the problem of sexual harassment following the Fox News allegations, “a giant and destructive error.”

“Mr. Shuman removed the only female manager at the company from her office and gave that office to Mr. Horine,” Fischer said in his filing, further underscoring his misgivings about the hiring decision. “Mr. Shuman now compounded by giving Mr. Horine priority over a female manager.”

Fischer said spent months dealing with unhappy employees, including one female who said she did not feel safe at the company or comfortable talking with Shuman about it, the suit charges.

In November, Fischer said he became aware of a Variety story about sexual harassment in talent agencies — one that would detail Horine’s alleged misconduct. That article, published on Nov. 3, 2017, cited multiple sources describing unwanted and persistent sexual advances.

“For the first time, in a purely self-interested way, Mr. Shuman suddenly became concerned about the company’s association with Mr. Horine,” Fischer alleged in the suit.

Horine and The Shuman Co. parted ways a day before the article’s publication, in which he was quoted as saying, in part, “I am regretful every day for any pain I have caused.”

“The damage was done. Morale and trust at the company were poisoned. Mr. Fischer lost confidence in Mr. Shuman’s judgment, integrity and concern for the well-being of the company’s employees and clients,” Fischer says in the filing. “The working conditions became intolerable. Any reasonable person in Mr. Fischer’s position would have seen no responsible alternative but to move on.”

Shuman held a companywide meeting, where he repeatedly described Horine as a “mensch” with whom he enjoyed a great working relationship. The founder did not apologize to female employees about the uncomfortable work environment, according to the suit.

On Nov. 13, Fischer said he “came to the inescapable conclusion” that he could no longer remain with the company. He told Shuman he was leaving to form his own management company, Literate. He said Shuman had promised to pay Fischer the salary and commissions owed under the employment agreement.

The Shuman Co. sued Fischer in March, claiming breach of contract,  and claiming Fischer is not entitled to derive income from work Fischer negotiated before leaving his old firm.