Can an employer be complicit in sexual abuse of employees?

A recent ruling cited the judgment in Brown v. USA Taekwondo (2021), which required a court to decide whether there was a special relationship or another set of circumstances giving rise to a duty of companies to protect young employees.

The two plaintiffs in the recent case sued MJJ Productions, Inc. and MJJ Ventures, Inc, two corporations wholly owned by the late Michael Jackson, who allegedly sexually abused them for many years while they were children.

Jackson allegedly formed MJJ Productions as the primary business entity holding the copyrights to his music and videos and formed MJJ Ventures partly for the purpose of employing the second plaintiff on various projects. He was allegedly president/owner and representative/agent of both corporations.

The second plaintiff’s lawsuit made the following allegations:

• Jackson and a few managing agents/employees developed and operated a sophisticated public child sexual abuse procurement and facilitation organization, designed to locate, attract, lure, and seduce victims
• He acted with the full knowledge, consent, and cooperation of the two defendant corporations
• The defendants were his co-conspirators, collaborators, facilitators, and alter egos for childhood sexual abuse
• The defendants employed individuals responsible for supervising Jackson and the minors in his charge
• The defendants, through their boards of directors and officers, conferred substantial authority upon him
• The defendants allowed Jackson to have solitary contact with the plaintiff, to let minors including the plaintiff sleep on his bed, to train and coach minors, to travel with them, and to have authority over them as an employment superior and supervisor

Read more: Archdiocese, churches move to strike child sexual abuse, negligence claims

The trial court dismissed the plaintiffs’ complaints. First, the negligence claims failed because there was no legal duty of care between the parties, the trial court found. The defendants had no ability to control Jackson who, as sole shareholder, had absolute legal control over the entities and all its employees, the trial court explained.

Second, the claim of breach of fiduciary duty failed because the defendants owed no fiduciary duty as plaintiff’s employers, the trial court said. The plaintiffs appealed and argued that the defendants had a legal duty to protect them from sexual abuse.

Employer’s duty exists

In the case of Safechuck v. MJJ Productions, Inc. et al., the California Court of Appeal for the Second District reversed the judgment of the trial court. The appellate court rejected the defendants’ argument that, since Jackson was their sole shareholder, they lacked control over him and over the plaintiffs’ welfare.

A corporation facilitating child sexual abuse by one of its employees was not excused from its affirmative duty to protect and warn those children just because the perpetrator was the corporation’s sole owner and shareholder, the appellate court ruled.

The appellate court found a special relationship between the plaintiffs and the defendants, which gave the plaintiffs the right to expect protection from Jackson, and found special circumstances, which burdened the defendants with a special obligation to offer the plaintiffs assistance.

The appellate court made the following findings:

• The defendants employed Jackson and the plaintiffs who, as young children, were vulnerable and dependent upon the adults supervising and taking care of them
• The defendants’ employees, officers, and directors had some control over and responsibility for plaintiffs’ welfare
• The defendants’ employees ran Jackson’s residences, adopted policies and operations enabling him to be alone with the plaintiffs, arranged for the plaintiffs to be guests in locations that they staffed and ran, and knew about the danger that Jackson might molest the plaintiffs

Any director, employee, or agent of the defendants who knew about or suspected abuse could have taken steps to protect the plaintiffs’ welfare, could have warned them, could have contacted police, and could have confronted Jackson, the appellate court said.

While a director or employee risked a loss of their position and compensation, removal from the board of directors, or termination of employment if they tried to protect the plaintiffs, this risk did not mean that they had an inability to act, the appellate court concluded.