Doe v. Grand Co.
| Decision Date | 18 February 2020 |
| Docket Number | Case No. 18-cv-13123 |
| Parties | JANE K.K. DOE, Plaintiff, v. THE GRAND COMPANY, LLC, ZAHER MANAGEMENT COMPANY, LLC, ZAHER INVESTMENT GROUP, LLC, LIONS GATE DEVELOPMENTS, LLC, RAJI ZAHER, JOSEPH ZAHER, & RABI ZAHER, Defendants. |
| Court | U.S. District Court — Eastern District of Michigan |
In this case, Plaintiff Jane K.K. Doe,1 a nineteen-year-old college student home for the summer, found herself working for the family business of one of her parents' gym acquaintances, Defendant Raji "RJ" Zaher. In the course of Doe's summer working the front desk at The Grand, an apartment complex that the Zahers owned and managed through a complex web of LLCs, she alleges that she wassexually harassed. (See generally, ECF No. 4, Amended Complaint, PgID 40-61.) Specifically, she alleges that RJ and his brother, Defendant Rabi Zaher, subjected her to inappropriate and sexual comments, and that on two separate occasions, RJ pressured her into going to a strip club with him on her lunch break, where RJ and a dancer at the club removed her clothing and touched her in an unwelcome and sexual manner. (Id.) Based on these experiences, she filed this suit against RJ, Rabi, their father Joseph Zaher, Doe's supervisor and the apparent head of the family business, and four of the Zaher family's LLCs—The Grand Company, LLC; Zaher Management Company, LLC; Zaher Investment Group, LLC; and Lions Gate Developments, LLC. (Id.)
Doe brings one claim of harassment and hostile work environment against all of the defendants under Title VII of the Civil Rights Act of 1964, as well as a parallel sexual harassment and hostile work environment discrimination claim under the Michigan Elliot-Larsen Civil Rights Act (ELCRA) against all the defendants, one claim of negligent supervision and one claim of negligent failure to train against The Grand Company, LLC and Zaher Management Company, LLC, one claim of assault and battery and one claim of invasion of privacy against RJ, and one claim of intentional infliction of emotional distress against The Grand Company, LLC, ZaherManagement Company, LLC and RJ.2 (Id.) Defendants have collectively filed a Motion for Partial Summary Judgment, seeking to dismiss all of Plaintiff's claims except for her assault and battery, invasion of privacy, and intentional infliction of emotional distress claims against RJ. (ECF No. 42.)
For the reasons detailed below, the Court grants summary judgment on Plaintiff's Title VII claim against all defendants (Count I), on Plaintiff's negligent supervision, negligent failure to train and intentional infliction of emotional distress claims against Zaher Management and The Grand Company (Counts V, VI, and IX in part), and on Plaintiff's ECLRA claim against Zaher Investment Group, LLC and Lions Gate Development, LLC (Count II in part). The Court denies Defendants' Motion for Summary Judgment on Plaintiff's ELCRA claim against RJ, Rabi, Joseph, Zaher Management, and The Grand Company (Count II in part). Plaintiff's assault and battery, invasion of privacy, and intentional infliction of emotional distress charges against RJ (Counts VII, VIII, & IX in part) were not at issue in the motion and are unaffected by this Opinion and Order.
Although the remaining claims are all matters of Michigan state law, the Court exercises supplemental jurisdiction on these claims because this Court is well versedin the complex facts of this case, which has proceeded to an advanced stage of litigation. See 28 U.S.C. § 1367(c).
Because this is a Motion for Summary Judgment, the following facts are recounted in the light most favorable to the non-moving party—here, Plaintiff Jane Doe. See Moran v. Al Basit LLC, 788 F.3d 201, 204 (6th Cir. 2015).
Defendant Joseph Zaher and his sons, RJ and Rabi, are in the property development business. They operate through several different LLCs that Joseph, for the most part, owns. (See, e.g., ECF No. 53-7, Joseph Dep., PgID 957-63.) Some of these LLCs are used solely for the purpose of holding the title to the properties that they are developing. One of Joseph's businesses, Zaher Holding Group, LLC, holds title to several lots in residential areas, at least two of which have homes being built upon on them. (Id. at PgID 956-57.) Another of Joseph's companies, Zaher-Davison/Irish LLC, holds four condominium units in a subdivision called Lions Gate. (Id. at PgID 960; see also ECF No. 53-19, Zaher-Davison LLC Docs., PgID 1230-32.) Rabi Zaher lives in one of the units while the other three are rented out. (ECF No. 53-7, Joseph Dep., PgID 960.) Finally, The Grand Company, LLC holds title to The Grand, a housing and apartment complex containing 102 rental units. (Id. at PgID 958; see also ECF No. 53-20, The Grand Co. LLC Docs, PgID 1235-41.)According to the Zahers, The Grand Company, LLC and Zaher Holding Group, LLC simply exist to hold title to the properties—The Grand Company does not even have a checking account. (ECF No. 53-6, RJ Dep., PgID 888.) The Grand Company is a defendant.3
The Zahers manage their rental units at The Grand and in the Lions Gate development through Zaher Management Company, LLC. (Id. at PgID 961; see e.g., ECF No. 53-12, Rabi Dep., PgID 1126-27 (describing being called to several properties in his capacity as the maintenance man for Zaher Management).) Unlike the other LLCs discussed so far, Joseph is not listed as the resident agent of Zaher Management, instead, it is organized under the name of his wife, Odette. (ECF No. 53-17, Zaher Management LLC Docs., PgID 1219-21; see also ECF No. 53-7, Joseph Dep., PgID 961 ("[I]t's in the name—my wife's name on the corporation.").) Joseph, however, signed Zaher Management's annual statements in at least 2016, 2017, and 2018, as either the owner or the president. (ECF No. 53-17, Zaher Management LLC Docs., PgID 1222-24.) RJ identified Joseph as the owner of Zaher Management and Rabi testified that his mother never really performed substantive work for Zaher Management. (ECF No. 53-6, RJ Dep., PgID 887-88; ECF No. 53-12, Rabi Dep., PgID 1123-24.) So, despite the fact that the LLC istechnically in Odette's name, Joseph, who handles much of the day-to-day work of Zaher Management, is the de facto owner of Zaher Management. (See ECF No. 53-6, RJ Dep., PgID 893-99 (RJ describing Joseph directing the operation of Zaher Management).) Zaher Management, which was the entity that officially employed Doe, is a defendant in this case. (ECF No. 53-7, Joseph Dep., PgID 977.)
RJ and Rabi each own or have owned their own LLCs, which have also been engaged in real estate development in connection with their father's companies. RJ had a company called Lions Gate Development, LLC. (ECF No. 53-6, RJ Dep., PgID 882.) RJ, through Lions Gate Development, LLC, partnered with his father, Joseph, to purchase over hundred acres of empty property and develop it into the Lions Gate subdivision. (Id.) He focused on building the "apartment side" of the development, while Joseph, through one of his various LLCs, built the "condominium side" of Lions Gate. (Id.) Lions Gate Development, LLC built 200 apartment units, but then RJ lost them through foreclosure sometime between 2011 and 2013. (Id. at PgID 883.) RJ has not engaged in any business through Lions Gate Development, LLC since the foreclosure, and has not, in fact, been formally employed or held any property in his own name since that time. (Id. at 884-86.)
Joseph still owns the four condominium units that he built in Lions Gate through Zaher-Davison/Irish, LLC. (ECF No. 53-7, Joseph Dep., PgID 960.) He also, through Zaher-Davison/Irish, owns additional land in the Lions Gatesubdivision on which additional condos are being built. (ECF No. 53-12, Rabi Dep., PgID 1111, 1120.) Lions Gate Development, LLC is a defendant in this case, though Plaintiff has indicated that she intended to sue the entity that holds the condominiums in the Lions Gate subdivision, which is Zaher-Davison/Irish, LLC. (See ECF No. 56, Response, PgID 1269 n. 10.) Plaintiff has requested "the right to amend" in order to substitute Zaher-Davison/Irish for Lions Gate Development. (Id.)4
Rabi, who is formally employed by Zaher Management, owns his own LLC, called West Coast Development. (ECF No. 53-12, Rabi Dep., PgID 1118-19.) Rabi, through West Coast, is building condominiums in the Lions Gate subdivision. (Id. at PgID 1120-21.) Joseph provided Rabi with a personal loan to fund construction of the first condominium that West Coast built in Lions Gate and Joseph continues to own the Lions Gate property that West Coast is developing. (Id. at PgID 1111, 1120.) West Coast is not a defendant.
Despite the technical separation of the various parts of the Zaher family real estate development and management business, Joseph, RJ and Rabi all live off of Zaher Management income. Rabi lives in one of the condominiums at Lions Gate rent-free, he drives a truck leased by Zaher Management, he goes on family vacations paid for by Zaher Management, and uses a Zaher Management credit cardfor meals, travel, luggage, and work clothing. (ECF No. 53-12, Rabi Dep., PgID 1122-23.) Joseph pays for everything for RJ, who is technically unemployed. (ECF No. 53-6, RJ Dep., PgID 885.) Joseph pays for RJ's credit card, on which he spends $2,000-3,000 a month, pays private school tuition for RJ's children, pays for RJ and his wife to lease a 2017 Cadillac Escalade and a 2016 Mercedes respectively, and has furnished RJ and his family with a 6,000-7,000 square foot home. (Id. at PgID 885-86, 889.) Zaher Management is also paying the legal bills for all of the defendants. (ECF No. 53-7, Joseph Dep., PgID 971-72.)
Rabi is formally on Zaher Management's payroll for his job in performing maintenance on all of the properties Zaher...
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