Graduate Level Franchising and Management Contracts Course, paper needs to be 3 to 5 pages and needs to answer the question.

Essay #1 — Vicarious Liability of Franchisor —– Franchisee’s Employee Sexual Harassment —

In September 2015, a company named Surf Pizza, LLC (Surf or the franchisee), acquired an existing Domino’s pizza franchise in Southern California. The franchise agreement was signed for Surf by its sole owner, Daniel Smith (Smith). The other contracting party was Domino’s Pizza Franchising, LLC, which was related to both Domino’s Pizza, Inc., and Domino’s Pizza, LLC (collectively, Domino’s or the franchisor).

When operations began, Surf retained, as its employees, the 17 or 18 people who already staffed the store. One of them was Ray Miranda (Miranda), an adult male who held the title of assistant manager.

In November 2015, a young woman named Taylor Pace (Pace) was hired to serve customers at the Surf store. Her job soon ended due to the following circumstances.

In June 2016, Pace filed this action against Miranda, Surf, and Domino’s. She alleged the following facts: Miranda worked as a manager at the Surf store. He sexually harassed her whenever they shared the same shift. He made lewd comments and gestures, and grabbed her breasts and buttocks. After Miranda refused to stop, Pace reported the problem to her father and to Smith.

Pace’s father contacted the police. He also called Domino’s “corporate office,” and told someone in the human resources department about the sexual harassment his daughter had endured at the Surf store. Pace stayed away from work for one week, and then returned. She soon resigned. She perceived that her hours were reduced because she had reported Miranda’s misconduct to others.

Pace’s complaint stated several causes of action. The first three counts invoked the California Fair Employment and Housing Act (FEHA), and alleged sexual harassment, failure to take reasonable steps to avoid harassment, and retaliation for reporting harassment. (See Gov. Code, § 12900 et seq.) Otherwise, the complaint asserted common law counts for intentional infliction of emotional distress, assault and battery, and constructive termination against public policy under FEHA. Compensatory and punitive damages were sought.

Critical here is Pace’s portrayal of the legal relationship between Domino’s and the employees of Surf. As to all causes of action, the complaint maintained that Domino’s was the “employer” of both Pace and Miranda, and that they were the “employee[s]” of Domino’s. Each defendant was described as the agent, employee, servant and joint venture of the other defendants. At all relevant times, defendants purportedly acted within the course, scope and authority of such agency, employment and joint venture, and with the consent and permission of the other defendants. Also, it was alleged that the officers and/or managing agents of every defendant “ratified and approved” all actions of the other defendants.

Question:

Discuss the likely outcome of this lawsuit citing legal precedent. Argue from both sides – under what circumstances will franchisor, franchisee, and/or plaintiff prevail?

Paper has already been started but still needs about another page of material added.