Silicon Valley's most fabled venture capital firm says it's ready to do battle with a former partner who's filed a sex-discrimination lawsuit.

Kleiner Perkins Caufield and Byers had hoped to compel Ellen Pao to take the case to binding arbitration, keeping the suit's scandalous accusations -- and the firm's inner financial workings -- out of the public eye.

But with the California Supreme Court on Wednesday having turned aside that request, a spokeswoman said the firm will "vigorously defend the matter" and is "confident we will prevail."

Kleiner spokeswoman Christina Lee also echoed the firm's earlier contention that Pao's complaint is "wholly without merit."

Meanwhile, Pao's lawyer told this newspaper that he's preparing to add a wrongful termination claim to the lawsuit, which has rocked Silicon Valley's staid tech-investing world.

This past October -- five months after filing the suit -- Pao was pushed out of the firm, which has seeded such tech giants as Google (GOOG), Amazon and Genentech.

Kleiner said then that Pao was asked to leave "because of long-standing issues having no relationship or bearing on the litigation." The firm in court filings has argued that Pao, a Princeton and Harvard graduate, performed poorly as a venture capitalist and that her failure to advance in the firm was due to those struggles, not to a hostile workplace environment.

Pao's lawsuit contends that she was pressured into sex by a former colleague and, when she complained to the firm's senior management, was punished and excluded from lucrative financial opportunities.

A San Francisco Superior Court judge in July 2012 ruled that Pao's employment agreements with the firm did not compel her to submit to arbitration, and a state appeals court agreed this past June. The state Supreme Court this week refused to take up the case, and Kleiner Perkins opted not to appeal to the U.S. Supreme Court, which legal experts say would have been extremely unlikely to intervene.

Pao's lawyer, San Francisco-based Alan Exelrod, said he's been unable to add the wrongful termination claim to the suit while the case was under appeal. The lawsuit already asserts that Pao's punishment while employed at the firm cheated her out of millions of dollars.

"The next step is then starting with discovery, doing the depositions that are necessary, gathering the documents," Exelrod said.

While he declined to estimate when a trial date might actually be set -- or comment on whether the two sides may pursue an out-of-court settlement -- several legal experts said it could be a year until jury selection occurs.

Contact Peter Delevett at 408-271-3638. Follow him at Twitter.com/mercwiretap.