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Doe v. Red Roof Inns, Inc.

Doe v. Red Roof Inns, Inc.

United States Court of Appeals for the Eleventh Circuit

December 22, 2021, Filed

No. 20-11764, No. 20-11769, No. 20-11771, No. 20-11770

Opinion

BRASHER, Circuit Judge:

Four sex trafficking victims, proceeding as Jane Does, filed complaints against numerous defendants within the hotel industry for violations of the Trafficking Victims Protection Reauthorization Act, specifically 18 U.S.C. § 1595(a), and Georgia state law. ] Under the TVPRA, a trafficking victim may sue a sex-trafficking perpetrator and "whoever knowingly benefits, financially or by receiving anything of value from participation in a venture which that person knew or should have known has engaged in an act in violation of [the Trafficking Victims Protection Act]." 18 U.S.C. § 1595(a). The Does alleged that they were trafficked in Atlanta-area hotels and sued the hotel operators, employees, owners, franchisees, and franchisors of those hotels.

The district court held that the Does failed to plausibly allege claims against three hotel franchisors: [*4]  Choice Hotels International, Inc., Wyndham Hotels & Resorts, Inc., and Microtel Inn & Suites Franchising, Inc. It dismissed their amended complaints as to those franchisors. And the Does appealed.

To resolve this appeal, we must answer two questions. First, we must decide a question of first impression about the elements of a TVPRA beneficiary claim. ] We hold that Section 1595(a) should be applied according to its plain meaning: that is, to state a claim for beneficiary liability under the TVPRA, a plaintiff must plausibly allege that the defendant (1) knowingly benefited (2) from taking part in a common undertaking or enterprise involving risk and potential profit, (3) that the undertaking or enterprise violated the TVPRA as to the plaintiff, and (4) that the defendant had constructive or actual knowledge that the undertaking or enterprise violated the TVPRA as to the plaintiff. Second, we must determine whether the Does have plausibly alleged facts that satisfy those elements against each of the franchisors. Here, we conclude that the Does have failed to meet that burden as to the three franchisors at issue on appeal. We likewise conclude that, as to these three defendants, the Does did not state [*5]  a plausible claim under Georgia state law. Accordingly, we affirm.

I. BACKGROUND

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2021 U.S. App. LEXIS 38060 *; 21 F.4th 714; 29 Fla. L. Weekly Fed. C 656; 2021 WL 6062493

JANE DOE #1, Plaintiff-Appellant, versus RED ROOF INNS, INC., et al., Defendants, CHOICE HOTELS INTERNATIONAL, INC., WYNDHAM HOTELS & RESORTS INC, MICROTEL INNS AND SUITES FRANCHISING, INC., Defendants-Appellees.JANE DOE #2, Plaintiff-Appellant, versus RED ROOF INNS, INC., et al., Defendants, CHOICE HOTELS INTERNATIONAL, INC., WYNDHAM HOTELS & RESORTS INC, MICROTEL INNS AND SUITES FRANCHISING, INC., VARAHI HOTEL, LLC, Defendants-Appellees.JANE DOE #3, Plaintiff-Appellant, versus RED ROOF INNS, INC., et al., Defendants, WYNDHAM HOTELS & RESORTS INC, MICROTEL INNS AND SUITES FRANCHISING, INC., ESA MANAGEMENT, LLC, ESA P PORTFOLIO, LLC, EXTENDED STAY AMERICA, INC., ESA P PORTFOLIO OPERATING LESSEE, LLC, Defendants-Appellees.JANE DOE #4, Plaintiff-Appellant, versus RED ROOF INNS, INC., et al., Defendants, CHOICE HOTELS INTERNATIONAL, INC., WYNDHAM HOTELS & RESORTS INC, MICROTEL INNS AND SUITES FRANCHISING, INC., Defendants-Appellees.

Prior History:  [*1] Appeal from the United States District Court for the Northern District of Georgia. D.C. Docket No. 1:19-cv-03840-WMR.

Appeal from the United States District Court for the Northern District of Georgia. D.C. Docket No. 1:19-cv-03841-WMR.

Appeal from the United States District Court for the Northern District of Georgia. D.C. Docket No. 1:19-cv-03843-WMR.

Appeals from the United States District Court for the Northern District of Georgia. D.C. Docket No. 1:19-cv-03845-WMR.

Doe v. Red Roof Inns, Inc., 2020 U.S. Dist. LEXIS 67141, 2020 WL 1872333 (N.D. Ga., Apr. 13, 2020)Doe v. Red Roof Inns, Inc., 2020 U.S. Dist. LEXIS 67142, 2020 WL 1872336 (N.D. Ga., Apr. 13, 2020)Doe v. Red Roof Inns, 2020 U.S. Dist. LEXIS 67140, 2020 WL 1872337 (N.D. Ga., Apr. 13, 2020)

CORE TERMS

franchisors, trafficking, hotel, venture, sex, district court, allegations, knowingly, participated, employees, enterprise, benefited, amended complaint, take part, final judgment, facilitating, franchise, complaints, rooms, just reason, franchisees, cases, racketeering activity, beneficiary's claim, prostitution, discovery, occurring, potential profit, plain meaning, Black's Law

Criminal Law & Procedure, Criminal Offenses, Crimes Against Persons, Sex Crimes, Governments, Legislation, Statutory Remedies & Rights, Civil Procedure, Appeals, Standards of Review, Abuse of Discretion, Judgments, Entry of Judgments, Multiple Claims & Parties, De Novo Review, Appellate Jurisdiction, Final Judgment Rule, Defenses, Demurrers & Objections, Motions to Dismiss, Failure to State Claim, Pleadings, Complaints, Requirements for Complaint, Interpretation, Racketeering, Racketeer Influenced & Corrupt Organizations Act, Business & Corporate Law, Distributorships & Franchises, Franchise Relationships, Actual Authority, Implied Authority, Conduct of Parties, Agency Relationships, Ratification, Proof, Scope, Express & Implied Ratification