Doe v. McAdam Fin. Grp.

• Decision Date: 03 August 2022
• Docket Number: 22-CV-00113 (GHW)(SN)
• Parties: JANE DOE 1, Plaintiff, v. MCADAM FINANCIAL GROUP LLC, et al., Defendants.
• Court: U.S. District Court — Southern District of New York

JANE DOE 1, Plaintiff,
v.
MCADAM FINANCIAL GROUP LLC, et al., Defendants.

No. 22-CV-00113 (GHW)(SN)

United States District Court, S.D. New York

August 3, 2022

HONORABLE GREGORY H. WOODS

REPORT & RECOMMENDATION

Sarah Netburn United States Magistrate Judge

Jane Doe 1 (“Doe”) sued McAdam Financial Group LLC (“McAdam Financial”) and its former employee Charles Norfleet (“Norfleet”) after Norfleet raped her the night after a company-sponsored outing at local bars in Boston, Massachusetts. Both Defendants move to dismiss Doe's complaint for lack of personal jurisdiction, improper venue, and failure to state a claim. Alternatively, Defendants move that the case be transferred to the District of Massachusetts. I recommend that the Court transfer the case to the District of Massachusetts. If the Court disagrees with my conclusion, I request that this matter be remanded to me for further consideration of Defendants' other arguments.

BACKGROUND

McAdam Financial is a financial advisory firm with offices in four states that serves over 5,000 clients and has over $829 million of assets under management. ECF No. 6 (Compl.) ¶¶ 2425. Doe, who resides in New York, started work at McAdam Financial as a financial advisor in June 2020 after graduating college. Id. ¶¶ 21, 34. Norfleet, a Lead Senior Manager, worked in a

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supervisory position above employees like Doe and ran regular meetings for entry-level financial advisors at McAdam Financial. Id. ¶ 37. Doe interacted with him on a weekly basis, especially in connection with the meetings that he ran. Id. She also worked with Norfleet in other contexts; among other things, he helped Doe learn sales techniques and attract clients. Id. ¶¶ 37, 56. Norfleet worked from McAdam Financial's Boston office at all times during his employment, along with District Manager Aaron Swenson (to whom Doe reported), Senior Manager Ian Helmus, and District Manager Davis Wilson. Id. ¶¶ 36, 38-39.

Because Doe started work at McAdam Financial during the COVID-19 pandemic, she worked remotely at first, but she got to know her coworkers over video and group calls. Id. ¶ 40. She learned from other female employees in the McAdam Financial Boston office who had worked with Norfleet in person that he had a reputation for inappropriate behavior towards women. Id. ¶¶ 40-42. He made sexualized comments to subordinate female employees, inappropriately grabbed and physically touched female employees while out at events, and groped a female coworker. Id. ¶¶ 42, 44. Nothing was done to remediate his conduct. Id. ¶ 47. Other male managers also engaged in inappropriate conduct: Norfleet, Swenson, Helmus, and Wilson had a group chat in which they often discussed and bantered about the appearances of their female coworkers. Id. ¶¶ 48-49. All of the managers at McAdam Financial who trained entry-level advisors like Doe were men. Id. ¶ 54. At the Boston office, some male managers frequently discussed their female coworkers' appearances. Id. Doe also noticed that most successful managers at the company were men, but did not raise the issue of gender disparity among managers because doing so would make professional advancement more difficult. Id. ¶¶ 54-55. Doe describes other sexualized behavior towards women at McAdam Financial; management was aware but took no remedial action. Id. ¶¶ 49-51, 58-61.

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On June 25, 2021, Doe traveled from New York to Boston to visit the McAdam Financial office and meet some of her coworkers in person for the first time. Id. ¶¶ 63-64. That day, McAdam Financial hosted an after-work social event at a bar in Boston called Flight Club because the company had achieved some internal goals. Id. ¶ 64. Specifically, Swenson (Doe's direct manager) organized the outing to celebrate receiving a company bonus based on the numbers achieved by junior employees, including Doe. Id. He said that he would use some of the bonus money to pay for everyone's drinks. Id.

At around 4:00 p.m. that day, about 18 McAdam Financial employees-including Doe- went to Flight Club. Id. ¶ 65. As the night progressed, Norfleet gave her multiple drinks. Id. ¶ 66. The group of employees eventually left Flight Club and went to another bar called Publico. Id. ¶ 67. Once there, Doe felt dramatically more intoxicated, to the point where she believes that she may have been drugged or supplied and urged to consume so much alcohol by Norfleet that she entered into a “blackout” state. Id. Doe's coworkers later informed her that, while the group was at Publico, they saw Norfleet making out with her at the bar while she was in an obviously intoxicated state, although she was unable to understand or appreciate what was happening and has no memory of doing so. Id. ¶¶ 68-69. Multiple McAdam Financial employees, some of whom had supervisory authority over Doe, personally observed Norfleet making out with her, then leaving the bar with her, and did not intervene. Id. ¶¶ 70-71. At least four current employees who saw her leave with him have since expressed their regret to Doe for not stepping in. Id. ¶ 72.

The next morning, Doe woke up naked in an unfamiliar bed. Id. ¶ 73. It was clear to her that Norfleet had raped her while she was either unconscious or unable to consent. Id. While she was trying to figure out where she was, Norfleet climbed on top of Doe and again raped her. Id. ¶ 75. Paralyzed by fear and helplessness, Doe was frozen and unable to respond; Norfleet stayed

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completely silent during the rape. Id. ¶¶ 76-77. After the assault, Doe got up but could not find her clothes. Id. ¶ 78. Norfleet knew where they were and retrieved them. Id.

When Doe left to go to her sister's apartment, she began to fear for her employment status at McAdam Financial because Norfleet was her supervisor and could impact her ability to make money in her commission-based role. Id. ¶¶ 80-81. To protect herself and gauge Norfleet's disposition, Doe engaged in casual text conversation with him so that he would not take any negative employment action against her. Id. ¶ 84.

That day, June 26, 2021, Doe took a train back to New York. Id. ¶ 82. Once she arrived, she took Plan B, a form of emergency contraception. Id. ¶ 83.

Three days later, on June 29, 2021, she disclosed the sexual assault to Swenson, her direct supervisor, who told her that he could not handle the report and that she would need to speak to a vice president. Id. ¶¶ 85-86. Doe then related the events again to Vice President Joseph MacDonald. Id. ¶ 88. It was apparent to her during that second conversation that others had told MacDonald she had “gone home with” Norfleet. Id. MacDonald then told Doe that, whenever she was ready, she could discuss the assault with Jack McAdam, Chief Operating Officer and brother of McAdam Financial's founder. Id. ¶¶ 90-91.

Also on June 29, 2021, Doe participated in a video call with several female coworkers who expressed their regret about what had happened. Id. ¶ 94. Two women told her that Norfleet had touched them inappropriately the night she was assaulted. Id. Doe also learned that until about a month before the assault, Norfleet was in a committed relationship but regularly made comments about how annoying his girlfriend was. Id. ¶ 95. On one occasion, he said to another female employee at McAdam Financial (“Doe 2”) that he had always been interested in her. Id. About two weeks before he raped Doe, Norfleet and Doe 2 had been among a number of

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McAdam Financial employees who participated in a company-sponsored kickball game, then went out to a bar. Id. ¶ 96. At the bar, Norfleet touched Doe 2 in a way that made her uncomfortable, grabbing her waist and touching her back. Id. Supervisory employees saw Norfleet touching Doe 2 and another female employee in this manner. Id. ¶¶ 96-98. That night, Doe 2 had an experience almost identical to Doe's: she did not remember part of the night or going home with Norfleet, but recalled waking up naked in an unfamiliar bed and Norfleet climbing on top of her and raping her again once she had woken up. Id. ¶ 100. It is unclear whether other employees at McAdam Financial knew about Norfleet's assault of Doe 2 before this call. Id. ¶ 102.

Multiple supervisory employees at McAdam Financial were generally aware of Norfleet's conduct towards female employees, but the company failed to take any remedial action or conduct any investigation into his behavior before June 25, 2021, that might have prevented his rape of Doe. Id. ¶ 99.

On June 30, 2021, Doe called Jack McAdam to report Norfleet's assault. Id. ¶ 104. A couple of days later, she began seeing a therapist, id. ¶ 105, and a week later, on July 6, 2021, Jack McAdam told her that the company had not yet come to a resolution but would by July 9, 2021, id. ¶ 106. He offered for the company to pay for her therapy sessions. Id. ¶ 107. Also on July 6, 2021, Norfleet communicated through a coworker to ask Doe if she would speak with him, and she refused. Id. ¶ 108. On July 12, 2021, Jack McAdam informed Doe that Norfleet was no longer employed by McAdam Financial. Id. ¶ 109.

Doe continued to seek therapy as a result of her assault, but McAdam Financial did not follow through with its promise to pay for the costs of her therapy. Id. ¶¶ 111-12. After receiving notice that Doe had hired counsel, McAdam Financial accused Doe of certain licensing non-

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compliance, which Doe claims was retaliation for her reporting Norfleet's conduct. Id. ¶ 113. The details of Doe's assault were known throughout the Boston office, and some employees were upset that Norfleet had been fired because he was a top sales manager who had helped many entry-level advisors gain clients. Id. ¶¶ 115-16. Doe believes that employees blamed her for his firing. Id. Under the circumstances, Doe resigned from McAdam Financial. Id. ¶ 117. She subsequently reported the rape by Norfleet to the Boston Police Department. Id. ¶ 118.

On January...