Proliferation Of Human Trafficking Lawsuits In The Hotel Industry

• Published date: 22 November 2021
• Subject Matter: Corporate/Commercial Law, Media, Telecoms, IT, Entertainment, Corporate and Company Law, Franchising, Hotels & Hospitality
• Law Firm: Pryor Cashman LLP
• Author: Mr Todd Soloway and Bryan Mohler

Over the past several years, a raft of lawsuits have been filed accusing hotel franchisors, franchisees, owners and operators of financially benefiting from human trafficking in violation of federal and state laws. According to the 2020 Federal Human Trafficking Report published by the Human Trafficking Institute, 170 federal human trafficking lawsuits were initiated against hotels in 2019 and 2020, including a series of high-profile lawsuits against some of the largest and most well-known international hotel management and franchise companies. While these lawsuits are pending in courts across the country, in 2020 the highest number of new federal civil suits were filed in the Southern District of New York, closely followed by the Eastern District of New York.

In this article, we explore the reasons for this exponential rise in human trafficking lawsuits targeting the hotel industry, the current legal developments in these actions, and consider steps hotel owners, operators and franchisors can take to protect themselves and their guests from liability.

TVPRA's Expansive Private Right of Action

The proliferation of human trafficking lawsuits against hotel entities is largely traceable to a single change in the law. On October 28, 2000, Congress passed the federal Tracking Victims Protection Reauthorization Act (TVPRA), the first federal law to criminalize human trafficking and penalizing both physical and non-physical coercion. In October 2003, Congress reauthorized the TVPRA, expanding its scope and adding a civil cause of action allowing trafficking victims to sue their traffickers for money damages in federal court through the enactment of 18 U.S.C. ' 1595. Under ' 1595, victims (or someone on their behalf) can file civil suits against their traffickers for claims involving forced labor, peonage, involuntary servitude, and/or sex trafficking, and if successful, recover actual damages, punitive damages, and reasonable attorneys' fees.

On December 23, 2008, Congress again reauthorized the TVPRA with a number of amendments. Of particular importance to the hotel industry, among the 2008 amendments included expanding the private right of action by creating a penalty for those who knowingly benefit from participation in ventures that engage in human trafficking. As amended, the TVPRA provides an avenue for victims to file civil suits not just against their actual traffickers, but also against anyone who "knowingly benefits, financially or by receiving...