By: Paul Goldberg, Senior Correspondent | LGBT Business Finance News
LAS VEGAS, NV — (August 23, 2026) — Television personality and media entrepreneur Phil McGraw, better known as Dr. Phil, is facing a lawsuit from his longtime former publicist alleging anti-gay discrimination, wrongful termination and other employment-related claims stemming from his work across McGraw’s evolving media business.
Jerry Sharell alleges that after years of promoting and protecting the Dr. Phil brand, his treatment changed as McGraw transitioned from his long-running syndicated television operation into Dallas-based Merit Street Media and later Envoy Media.
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The allegations, which McGraw and Envoy Media strongly deny, open another legal front surrounding McGraw’s media ventures following the high-profile financial collapse of Merit Street.
Jerry Sharell Alleges He Was Excluded From Dallas Move Because He Is Gay
Sharell alleges McGraw recruited him to continue working for his organization following McGraw’s departure from CBS and development of Merit Street Media.
According to the lawsuit, approximately 20 employees relocated to Texas as the new television venture established operations in the Dallas area.
Sharell alleges he was “intentionally excluded” from that group because he is openly gay.
McGraw allegedly told Sharell he would remain in California because “you’re Hollywood.”
Sharell claims he subsequently came to believe that his sexual orientation — rather than legitimate business considerations — influenced the decision to keep him away from the company’s Dallas operations and meetings involving executives from Trinity Broadcasting Network.
Those assertions are allegations contained in Sharell’s lawsuit and have not been proven in court.
Lawsuit Describes Religious Environment at Merit Street Media
Merit Street Media launched through a partnership with Trinity Broadcasting Network, the prominent Christian television broadcaster.
According to Sharell’s complaint, employees received a handbook and were asked to sign a “Statement of Faith” expressing devotion to Jesus.
Although Sharell continued working primarily from Los Angeles, he alleges that beginning in spring 2024 he traveled approximately once a month to Merit Street’s Dallas headquarters.
During those visits, Sharell claims a man identified in the complaint as “Pastor D” visited the workplace for employee prayer and left prayer cards for employees who did not participate.
Sharell also alleges that during one visit, an IT employee saw his photograph and made a disparaging comment that Sharell interpreted as referring to gay employees.
The complaint portrays those incidents as part of a workplace environment Sharell alleges became increasingly uncomfortable because of his sexual orientation.
Sharell Accuses McGraw of Making Anti-Gay Remark
Among the most striking allegations in the lawsuit is a comment Sharell attributes directly to McGraw.
Sharell alleges that while traveling aboard a private aircraft with McGraw, Robin McGraw and others, he was occupied responding to work emails when McGraw made a disparaging remark about him being gay and not listening.
The alleged comment is now part of Sharell’s broader contention that his sexual orientation affected his treatment within McGraw’s organization.
McGraw’s representatives dispute that allegation along with Sharell’s wider discrimination claims.
Merit Street Collapse Preceded Envoy Media Transition
The employment dispute also intersects with a turbulent period for McGraw’s media business.
Merit Street Media launched as an ambitious Dallas-based television venture but entered bankruptcy protection in 2025 after operating for little more than a year.
The bankruptcy subsequently developed into its own complicated legal battle involving Merit Street and Trinity Broadcasting Network.
McGraw later established Envoy Media, where Sharell alleges he continued performing publicity duties and receiving assignments.
According to the complaint, Sharell spent approximately a decade working for McGraw, promoting his television appearances and business interests while handling media relations and securing press coverage.
But Sharell alleges his employment arrangement changed dramatically during the transition to Envoy.
Lawsuit Alleges 30% Compensation Cut and Loss of Benefits
Sharell claims he went from being treated as an employee receiving benefits to being classified as an independent contractor even though his underlying job responsibilities remained substantially unchanged.
The lawsuit alleges the change resulted in Sharell losing employment benefits, including health coverage, while his compensation was reduced by approximately 30%.
Sharell maintains that he felt compelled to accept the arrangement under considerable pressure.
According to the complaint, Envoy Media Chief Executive Ken Solomon also reminded Sharell of the importance McGraw placed on “loyalty.”
Then, in March 2026, Sharell alleges Solomon informed him that his position was being placed on “hiatus” because of financial considerations.
Sharell claims he was the only employee subjected to that treatment and alleges other workers were not similarly placed on hiatus or subjected to comparable compensation reductions.
He argues those circumstances support his contention that he was being singled out.
Dr. Phil and Envoy Media Deny Discrimination Allegations
McGraw and Envoy Media are pushing back forcefully.
Attorney Chip Babcock, representing Envoy Media, disputes Sharell’s characterization of what happened and maintains that the publicist was not terminated because of his sexual orientation.
Babcock said placing employees on hiatus can occur within media startups and contends Sharell’s discrimination allegations are false.
McGraw’s side also points to what it describes as his decades-long history of treating LGBTQ+ people with dignity and respect.
The defense additionally argues that Sharell’s lawsuit represents an attempt to circumvent a pending arbitration that Sharell had contractually agreed to.
Envoy Media and McGraw have said they intend to vigorously defend against the claims.
Lawsuit Adds LGBT Workplace Discrimination Fight to Dr. Phil Media Battles
The litigation places several significant business issues under one spotlight: sexual-orientation discrimination, employee versus independent-contractor status, compensation reductions, workplace religious practices and the treatment of employees during a financially troubled corporate restructuring.
It also arrives as McGraw continues rebuilding his media operations following Merit Street Media’s collapse.
For Sharell, the dispute centers on whether the deterioration of a decade-long professional relationship was driven by legitimate financial and business considerations — as McGraw’s representatives maintain — or whether his sexual orientation played an unlawful role in his treatment, as Sharell alleges.
That question will now move into the legal process.
For the broader media industry, the case highlights the employment risks companies can face when corporate restructuring, workplace culture and protected characteristics collide.
Stay with JRL CHARTS LGBT Business Finance News for continuing coverage of LGBTQ workplace rights, corporate litigation, media-industry business and the financial stories impacting the LGBTQ community.
