On October 6, 2023, Arbitrator William Ricci announced that the North American Motors Inns, now known as the Philly Inn & Suites, and owner Ramara, Inc., which previously owned the West Philadelphia hotel when the trafficking occurred, as well as its former present Richard Melius, must pay sex trafficking victims, T.E., K.C. and V.S. $37.5 million. T.E. was awarded $13 million, K.C. was awarded $12 million and V.S. was awarded $12.5 million. The parties were mediating since August 1st and this is the first case in the United States to end up with a win in arbitration.
The Defendants, Melius and Ramara, previously filed motions for summary judgment, arguing that they owed no duty of care to the victims because they had been out-of-possession landlords during the time of the trafficking. The Defendants eventually agreed to arbitration which resulted in this multimillion-dollar award.
Nadeem Bezar and Emily Marks of Kline & Specter, PC, represented the survivors in this civil case. “Oh my God, finally, more than a decade after these horrible assaults, these women’s cries for justice were heard,” Bezar said. Bezar mentioned that the remaining defendants in this case, Ritz Hotel Group and Days Inn, have settled with the victims or resolved the allegations. “I’m happy for our clients. Despite being through so much in their young lives, they were able to persevere through his nightmare. It was important for them to tell their stories so that they could help other girls,” Marks said. Both Bezar and Marks stated that they think the verdict sends a message to other entities that they intend to litigate these cases and pursue full recovery for all victims of sex trafficking.
The three survivors were trafficked as minors in 2012 when they were only 16, 15 and 14. A man lured them in on social media by pretending to be a woman offering a chance to make money. The survivors were kept at the hotel for up to four months and manipulated mentally and threatened physically. Their trafficker was convicted and sentenced to prison.
Kline & Specter filed these civil suits in 2020 and 2021 to hold the hotel accountable for ignoring obvious and clear signs of sex trafficking. The hotel knew or should have known about the trafficking of these women and cited many examples, such as interactions between front desk staff, security guards and housekeepers, as evidence. Kline & Specter raised numerous counts against the hotel including negligence, negligent infliction of emotional distress, negligent training, hiring and supervision.
Kline & Specter have secured both verdicts and settlements for survivors of sexual abuse and sex trafficking. Most recently, in February 2023, Bezar and Marks won a $24 million settlement for eight women sex trafficked at the Days Inn. A ring of sex traffickers forced the women, who were minors at the time, to have sex for money at the motel.
“These cases give us an idea of the parameters again where these cases may be evaluated by arbitrators or juries and how they may determine the value of each case,” Bezar said. “But each case is an individual case, so although it gives us some idea, it’s just a benchmark.” Bezar commented that many factors determine whether a case ends in settlement or arbitration. These factors include: the extent of the trafficking involved; the length of trafficking; the age of the survivors; the different hotels’ liability; and the duration of the trafficking.
Kline & Specter filed another case in June against Motel 6, Ecno Lodge and Knights Inn and their respective owners, including Wyndham Resorts, for ignoring sex trafficking at their hotels and failing to implement policies to combat sex trafficking. The victim, S.W., alleges she was a victim of sex trafficking at the hotels when she was a minor and the hotels ignored the obvious signs of sex trafficking including large amounts of cash and condoms in the room, high foot traffic to the rooms, housekeeping being turned away and women staying in the rooms without leaving. The complaint states, “Due to the overall complacency of the hospitality industry on addressing the issues, hotels are the venue of choice for sex-trafficking as traffickers and buyers capitalize on the hotel industry’s general refusal to adopt and enforce company-wide anti-trafficking policies, from corporate to property level, train staff on what to look for, and how to respond, establish safe and secure reporting mechanisms for those at the point of sale”. S.W.’s trafficker, Daiquan Davis, pled guilty of sex trafficking in 2016 and was sentenced to twenty two years in prison.
The CSE Institute notes that hotels and motels are among the most common venues for facilitating and financially benefitting from sex trafficking. These venues provide both easy entry and financial secrecy for sex buyers. The Trafficking Victim’s Protection Act provides means to hold hotels both criminally accountable and civilly liable for sex trafficking.
The CSE Institute urges the hospitality industry to take ownership of this problem and confront it with tangible solutions. These solutions could include mandatory trainings for all management and employees to help them recognize the signs of sex trafficking in hotels and what to do if they suspect trafficking. The CSE Institute also urges the industry to stop turning a blind eye to the commercial sexual exploitation happening within their hotels. Instead, hotels and motels should become a leading force in stopping this exploitation altogether. The CSE Institute recognizes the need for legislation that would require these types of trainings, policies, and procedures to be implemented in every hotel and motel across the country.
The CSE Institute applauds the work of the attorneys in this civil matter. Most importantly, the CSE Institute applauds the bravery of the survivors in this case. After all, it is irrefutable that survivor voices will be the force of change in the sex trafficking narrative.