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Massage Envy Chain Gropes with Client Sexual Assault Lawsuits

More than 180 women have now filed sexual assault lawsuits, police reports, and state board complaints against the massive Massage Envy franchise chain, which includes franchisees, their employees and, some cases, the billion-dollar company itself, Massage Envy Franchising, operating under the umbrella of private equity firm Roark Capital.

The lawsuits allege that Massage Envy therapists "cross the line" into the area of molestation while performing the $40 to $50 massages offered by the company. When they filed reports against the franchise location, they were mishandled or ignored by franchisees and their employees, and even by Massage Envy's corporate headquarters. Their claims were not taken seriously.

An in-depth report last Sunday by BuzzFeed News stated that one of the victims, Susan Ingram, who filed a lawsuit later testified in court that after her incident she fled to her home and called the manager of the spa. Ingram said she had been sexually assaulted by the therapist who had been "enthusiastically recommended" by the spa. The employee took no action on her complaint, nor did the franchisee. The client then called the police, and the therapist was interviewed that afternoon. "He quickly admitted to assaulting not just her but other Massage Envy clients as well," the article states. The next year the therapist pleaded guilty to sexually molesting a total of nine women while working at Massage Envy from fall 2014 to spring 2015.

When the franchisee and her manager were confronted as to why they took no action on Ingram's complaint, they said they determined that the allegations were not credible, in part because it had been made by telephone and she would not return to the spa to discuss the events in person. When later questioned by attorneys regarding employees' actions, the franchisee stated she was following the policy of Massage Envy, and therefore she thought her decision was appropriate.

System policies protect franchisor more than clients or franchisees

BuzzFeed reported, "Massage Envy, the first and by far the largest chain of massage franchises in the country, is a billion-dollar business that promises trustworthy services at an affordable price. But BuzzFeed News found that more than 180 people have filed sexual assault lawsuits . . ." While the claims only represent a sliver of the tens of millions of services Massage Envy says its franchisees have provided, lawyers for the aggrieved spa clients told BuzzFeed that there are more cases where women report abuse by massage therapists to police but no arrest is made. Massage Envy spas sometimes offer a settlement before a suit is filed, leaving no public record.

"Statistically, most victims of sexual assault don't report at all. Even Massage Envy's own orientation manual, discussing client satisfaction in general, has warned new employees that "only 4% of upset customers will tell you when there is a problem," the news report stated.

Massage Envy told BuzzFeed News it would not be appropriate to respond point-by-point to questions "because of pending litigation" and the confidential documents involved. "But overall, Melanie Hansen, general counsel of Massage Envy Franchising, said the company has worked hard to create the industry's 'most stringent, rigorous policies' for hiring, screening, training therapists. Hansen explained, "We hold franchise owners accountable to our policies, and when we say nothing is more important to us than treating clients with respect and giving them a safe, professional experience, we mean it."

BuzzFeed News said its review found the franchisor's policies on reporting improper conduct do more to protect the franchisor and its brand than to ensure customer complaints are handled appropriately or that even franchised businesses under its brand are protected. "Customers have been violated in shocking ways, and then seen their reports brushed aside, while offending therapists have been allowed to keep their professional standing with no consequences."

What is surprising is that in most states, massage facilities have no legal obligation to report sexual assault claims made on their premises. But leaders in the industry state it is massage providers' inherent duty to address the issue as fully and as expeditiously as possible. BuzzFeed explained that the American Massage Therapy Association says it "strongly believes that any massage therapist who steps over the line to inappropriate touch should face the legal consequences."

BuzzFeed News also states that Ben Benjamin, coauthor of the influential book The Ethics of Touch, puts it more bluntly: "If a person says, 'someone put their finger in my vagina,' of course you call the police."

If employees are not sure whether a client has been the victim of a crime, BuzzFeed said experts in the field say they should encourage the person to file formal charges with law enforcement or state regulatory boards. And victims' rights advocates feel facilities should prominently display their reporting policies and hire specially trained, independent consultants if criminal allegations arise.

Massage Envy Franchising doesn't require its spas to take any of those steps. BuzzFeed said, "Except in the few places where local laws might demand it, the company does not compel its franchisees to notify law enforcement or to hire qualified investigators to help determine what happened. This holds true regardless of the seriousness of the allegation, even if it involves rape." Massage Envy only tells franchisees they must conduct their own "prompt, fair and thorough" investigation on claims. The franchisor provides little guidance on how to do so.

Joint liability

The news report states that while Massage Envy Franchising leads the industry in sexual assault policies, the franchisor also argues in court filings that as a company that sells franchise agreements rather than employing individual massage therapists, it should bear no joint liability in clients' sexual assault lawsuits. But it explains it is hard to know how these cases are resolved, since they are settled under strict confidentiality clauses.

In recent years, franchisors have been flexing their muscles wanting more control over the employment conduct of a franchisee as seen in its operating manual. What franchisors do not want is joint liability for their mandates. Currently, franchise contracts displayed in the franchise disclosure documents (FDDs) typically show that franchisors want a franchisee to take all of the blame, but the franchisor wants the ability to terminate the franchise license if the franchisee doesn't follow what the franchisor tells them to do in its operating manual, which sometimes are wrong instructions or just bad system standards. That creates a problem of moral hazard where the franchisor is immune from the consequences of bad standards if a franchisor gets it wrong.

But that could now change.

Susan Ingram's case, scheduled to go to trial in January 2018, may shed new light on how complaints are handled. Eight women filed a lawsuit against a Massage Envy's West Chester spa. At the center of the allegations is that the massage therapist who assaulted Ingram had told the manager by telephone about the alleged crime committed on her immediately when she returned home from the spa. While she begged the manager to stop the perpetrator's next appointment, then in progress, the manager refused. The BuzzFeed News report said that "despite Massage Envy's claims that it plays no role in investigations of inappropriate conduct, it in fact dictates the way they are conducted and followed, and oversees their progress." The West Chester franchise had only reported one of the prior complaints to corporate headquarters, but in depositions, the spa manager said a regional supervisor approved of the way it was handled and didn't call the police.

BuzzFeed also told that a franchise consultant who had worked with Massage Envy expressed that the company was in a particularly "tricky position." The unidentified consultant summed it up this way: "There's no way to prevent issues from arising at franchisees' locations. But we're talking about people getting sexually assaulted on tables in dark rooms, in national brands. You have to be human first. You have to think if your daughter or mother or aunt or grandmother came to you with a claim, how would you react?"


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About Janet Sparks

Janet Sparks's picture

Public Profile

Janet Sparks is the former publisher of the Continental Franchise Review, an industry newsletter that covered the franchise community for over 30 years. She has also been a columnist for a leading franchise magazine for the past 13 years. Today she is an independent journalist who engages in investigative reporting, tackling complex issues that impact the franchise industry.

Janet can be reached at jsparks@bluemaumau.org or at 303-799-7398.