Assault claim shifts to Sanford's 'control' over eXp agents

Assault claim shifts to Sanford’s ‘control’ over eXp agents

Time Stamp: March 1, 2024 3:21 PM
Source Node: 2501249

After largely beating back an attempt to get their claims tossed out of court, four female real estate agents have bolstered their complaint accusing eXp Realty and its founder and CEO Glenn Sanford of looking the other way as two male eXp agents allegedly lured women to industry and company events with the promise of career advancement, only to then drug and sexually assault them.

The amended complaint paints a picture of recruiting tactics that lean heavily on displays of success, allegedly at the instruction of eXp and Sanford. According to the complaint, such displays included top male recruiters boosting their status by drugging women to make it appear that the women were attracted to them. In a statement, eXp denied the latest allegations, emphasizing the agents’ independent contractor status.

On Feb. 28, Fabiola Acevedo and two agents previously known as Jane Doe 1 and Jane Doe 2 — now named as Tami Sims and Christiana Lundy, respectively — as well as another woman referred to as Jane Doe 3, filed a second amended complaint against eXp World Holdings, eXp Realty, Sanford, suspended eXp agent David Golden, now-former eXp agent Michael Bjorkman and eXp agent Brent Gove.

The complaint is similar to the plaintiffs’ first amended complaint and alleges the defendants violated a federal sex trafficking law by turning a blind eye or participating in assaults against the female agents by Golden and Bjorkman.

Golden and Bjorkman’s agent recruiting allegedly brought in substantial income through eXp’s revenue share program for Sanford and Gove, which allegedly led to eXp, Sanford and Gove allowing Golden and Bjorkman’s “behavior to go unchecked for years simply so they could continue to reap the financial benefits.”

Both complaints allege “Defendant eXp Realty attempted to cover up the criminal conduct of Defendants Bjorkman and Golden through the attempted use of Non-Disclosure Agreements.”

Inman reached out to Golden, Bjorkman and Gove for comment. We will update this story if and when responses are received.

In a statement, eXp spokesperson Jennifer Zimmerman told Inman that Bjorkman and Golden were never eXp employees.

“We take our responsibility to foster a safe and inclusive environment very seriously,” Zimmerman said.

“EXp Realty has zero tolerance for abuse, harassment, or misconduct of any kind — including by the independent real estate agents who use our services. The claims in this case stem from alleged assaults by independent real estate agents who were never eXp employees— which we handled with speed, seriousness and deep respect as soon as the accusers brought it to our attention, in line with our values and with the law.

“eXp hopes and trusts the court will give a full and fair hearing to the plaintiffs as they pursue claims against the individuals who allegedly assaulted them. However, the claims against eXp and its leadership have no basis in fact or law, and to which eXp vehemently denies. The court has dismissed some claims and we are prepared to present and defend our position on the others.”

The case, brought in the U.S. District Court for the Central District of California, is progressing under a backdrop of rising protests against sexual harassment in the real estate industry as well as a call for the National Association of Realtors to release women who have come forward with sexual harassment allegations from non-disclosure agreements (NDAs) prohibiting them from talking about their experiences.

By contrast to its predecessor, the second amended complaint adds details about eXp’s revenue share program and the degree to which Sanford and eXp exerted control over Golden and Bjorkman.

This is in response to an 85-page Jan. 29 ruling in which Judge André Birotte Jr. said the plaintiffs had “plausibly demonstrated a cover up” and mostly denied the defendants’ motions to dismiss the case. Some claims barred by Nevada’s two-year statute of limitations were tossed and a single claim against Sanford and eXp was also dismissed, but Birotte said the plaintiffs could amend and re-file their claim, which they did in a second amended complaint.

The claim accuses Sanford and eXp of negligent hiring, retention and supervision of Bjorkman and Golden, but Birotte said the plaintiffs had failed to provide specific facts plausibly showing that Bjorkman and Golden were Sanford’s employees, rather than independent contractors.

The second amended complaint attempts to address this deficiency by laying out Sanford and eXp Realty’s roles in eXp’s revenue share program, which the filing alleges is “a multi-level-marketing pyramid scheme which financially rewards the participants for recruitment of new agents, not for selling real estate” and requires the “continuous recruitment of new agents … without which it will collapse.”

The complaint alleges Gove, Sanford and eXp “instructed, required, and provided” Bjorkman and Golden with the “scripts, tools, and training” on how to entice agents to join the revenue share program.

“Defendant eXp requires all of its agents, including Defendant Bjorkman and Defendant Golden, to follow the eXp Agent Attraction Best Practices Guide, the eXp Agent Attraction Success Strategy, and eXp Realty’s Policies and Procedures; Defendant eXp Realty controls all of its agents with respect to recruitment,” the complaint says.

“Defendant eXp Realty, Defendant Sanford and Defendant Gove exercised considerable control over Defendant Bjorkman and Defendant Golden by giving them the means and methods to recruit agents to eXp,” the complaint adds.

According to the complaint, Gove, Sanford and eXp taught Golden and Bjorkman that the key to agent recruitment “is to project an image of success — both personally and professionally” and that eXp touted the wealth of its top recruiters to encourage more agents to hang their shingle at eXp.

“Defendant eXp Realty went to great lengths to showcase the success and wealth of its top influencers in order to convince others to join the pyramid and to attain the same level of prosperity,” the complaint says.

“This tactic repeatedly shows top agents sharing pictures of their yachts, airplanes, vacation properties, moves to Puerto Rico to the Compound for tax purposes and generally showcasing [how] much money they make each month due to their participation in the pyramid.”

The complaint alleges eXp invited agents to events “at beautiful, exotic locations” where they would be able to “rub shoulders” with top recruiters “with whom they were encouraged to develop relationships, as well as to be trained on how to utilize and to parrot the well-oiled recruitment techniques perfected by higher-ups at eXp Realty.”

“Both prospective eXp Realty agents and agents wanting to grow their downline believed that in order for them to develop their professional networks and become successful eXp Realty agents like Defendants Gove, Bjorkman and Golden, they had to be ‘in the room where it happens’, rubbing shoulders with the agent influencers that Defendant eXp Realty often put on stage, promoted in online videos, highlighted in their eXp Life magazine, or otherwise promoted visibly and regularly,” the complaint says.

The plaintiffs allege Gove “recommended, and still recommends to this day, that agents ‘share hotel rooms’ and encourages attendance at parties where he praises the fact that they have bars stocked with copious amounts of alcohol.”

According to the complaint, Bjorkman and Golden ensured [the availability of] “alcohol and drugs, including GHB, which is commonly referred to as a date-rape drug,” and that they would then “surreptitiously slip attendees intoxicants, or fraudulently induce them to take intoxicants, which would cause them to appear and to act as if they were attracted to” Bjorkman, Golden and their friends – “thereby elevating Defendants Golden and Bjorkman’s status at eXp – all in the name of appearing successful and consequently better recruiters for eXp Realty.”

Golden and Bjorkman allegedly shared videos and pictures of the women they had drugged and Gove “was keenly aware of the methods” they used at their recruiting events, according to the complaint.

“Because the success of Defendants Golden and Bjorkman directly impacted Defendant Gove, Defendant Sanford and Defendant eXp Realty, they routinely assisted Defendants Golden and Bjorkman in cultivating their image of success,” the complaint says.

“Defendant Gove, Defendant Sanford and Defendant eXp Realty maintained and controlled Defendant Bjorkman and Defendant Golden’s recruitment activities sufficient to establish vicarious or agency liability under the [Trafficking Victims Protection Reauthorization Act] TVPRA.”

EXp is also facing another lawsuit from a female agent who claims Golden and Bjorkman drugged and sexually assaulted her, as well as a third suit accusing eXp and team leader Chris Nevada of sexual harassment and retaliation.

An investigation from The New York Times, published in December, found that eXp leadership attempted to silence those who alleged they were assaulted. At the end of January, the New York State Comptroller called on eXp to formally investigate the alleged pattern of sexual assault and sexual harassment against women at its recruiting events.

Read the second amended complaint:

Email Andrea V. Brambila.

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