K.R. v. G6 Hospitality, LLC

Background

K.R.’s second amended complaint asserted claims against Marriott relating to alleged sex trafficking at a Westin hotel. The complaint alleged that Marriott was the successor to Starwood Hotels and Resorts Worldwide, Inc., and that Starwood became a wholly owned subsidiary of Marriott in 2016, after the alleged trafficking ended. Marriott moved to dismiss.

Court’s reasoning

The court held that the complaint did not state a claim based on successor liability. Successor liability can make a company responsible for a predecessor’s acts, so the relevant factual allegations must address the predecessor’s conduct. Although the complaint alleged that Marriott was Starwood’s successor, it did not allege any facts about Starwood’s actions during the period of the alleged trafficking. Instead, it described Marriott’s actions. The court concluded that this failure meant the complaint did not adequately state a claim for relief against Marriott under that theory.

The court also gave an additional reason for dismissing K.R.’s claim under California Civil Code section 52.5. That statute allows victims to seek damages for violations of California Penal Code section 236.1, which requires an intent to obtain forced labor or services. The court had previously alerted K.R. to the missing intent allegations, but the second amended complaint still did not allege the required intent. The court also noted that K.R.’s opposition did not address Marriott’s arguments about section 52.5.

Disposition

The court granted Marriott’s motion to dismiss. It dismissed K.R.’s section 52.5 claim with prejudice. Although the court said Marriott had a reasonable argument that the federal Trafficking Victims Protection Act claim should also be dismissed with prejudice, it gave K.R. another opportunity to amend rather than imposing that result. The court stated that the failure to allege successor liability was dispositive of the motion and directed counsel to address any additional defects, including Marriott’s arguments about what a parent company must know to support a federal trafficking claim. Any amended complaint had to be filed within 21 days, with responses due 21 days after filing. Judge Vince Chhabria signed the order.