"We are committed to: The highest ethical standards. Uncompromising honesty and integrity." —The Windermere Mission Statement "In the real estate business somebody's word is very important. If you say you're going to do something, you've got to do it." —Windermere CEO Geoff Wood's Public Affirmation

 

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WHY THE PUBLIC IS REFUSING TO BUY TICKETS TO SEATTLE PRO MUSICA'S CELTIC CHRISTMAS CONCERTS

 

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DOWNLOAD A COMPLETE PDF COPY OF THE RESPONDENT'S BRIEF HERE

 

ROBERTO RODRIGUEZ RESPONDENT'S BRIEF CONTINUED:

 

 

I. INTRODUCTION

 

            The trial court's award of reasonable attorney's fees and costs to Mr. Rodriguez was both appropriate and necessary pursuant to Washington law and its public policies. A finding otherwise would have validated a unilateral fees clause and resulted in the precise inequity the statute intends to remedy. This Court should disregard Windermere's attempt to truncate the relevant contractual language and misconstrue the law, and affirm the trial court's award of attorney's fees award to Mr. Rodriguez. Likewise, the trial court's award of prejudgment interest at 18%, as the parties had agreed was the reasonable rate of interest between them, was correct and should be affirmed.

 

II. ASSIGNMENTS OF ERROR

 

            Mr. Rodriguez assigns error to the trial court's Findings of Fact Nos. 2 and 3 of the Amended Order Awarding Attorneys' Fees and Costs:

            2.     The court withdraws the finding of fact numbered 6 [of the Order A warding Attorneys' Fees and Costs to Plaintiff, CP 397- 400].

            3.     The court expressly finds that real estate commissions, the source of which is a third party rather than the broker, do not constitute wages or salary.

CP 401-02.

            Mr. Rodriguez further assigns error to the trial court's Conclusion of Law No.1 of the amended Order Awarding Attorneys' Fees and Costs:

            1.       Mr. Rodriguez is not entitled to an award of attorneys' fees and costs under RCW 49.48.030.

 

CP 401-02.

 

III. STATEMENT OF THE CASE

 

A.         In Bad Faith and Without Reasonable Basis, Windermere

            Breached Its Termination Agreement with Mr. Rodriguez by

            Failing to Pay an Agreed Upon Commission

           

            This dispute began over a mere $16,800 listing commission that Windermere Real Estate Wall Street, Inc. ("Windermere") owed to Roberto Rodriguez on a real estate transaction. CP 5-9; TE 100.

            Mr. Rodriguez is a licensed real estate agent who worked out of Windermere's Wall Street office. CP 91. Sara Thompson was, until her death in 2010, a licensed real estate agent who also worked out of Windermere's Wall Street office. CP at 91. In May 2004, Mr. Rodriguez and Ms. Thompson formed an express oral partnership in which the two would contribute efforts to obtain property listing and sales and would split equally the commissions realized on those sales. CP 92, 95. Richard "Jake" Jacobsen is a licensed broker and is the branch manager of Windermere's Wall Street office. CP 91.

            On April 4, 2005, without explanation, Mr. Jacobsen terminated Mr. Rodriguez's agency with Windermere. CP 92. As part of the termination agreement, Mr. Jacobsen reviewed the files for five pending transactions and agreed that Mr. Rodriguez was entitled to one half of the listing commission on those transactions (the other half was to be paid to Ms. Thompson). CP at 92. Windermere and Mr. Rodriguez executed a written salesperson exit agreement that provided certain sums due Mr. Rodriguez from those five pending transactions would be paid when the transactions closed. CP at 92; TE 5. Among the amounts Windermere agreed to pay Mr. Rodriguez was $16,800 for his share of the listing commission on the sale of the Brady property. CP 92; TE 11.

            In November 2005, however, before the Brady transaction closed, Mr. Jacobsen unilaterally changed the commission disbursement form in a way that eliminated Mr. Rodriguez's share of the listing commission. CP 92; TE 14. Neither Mr. Jacobsen nor Ms. Thompson ever told Mr. Rodriguez of the change or that he would not receive his $16,800 share of the commission from the Brady transaction. CP 94.

 

B.         The Court of Appeals Rejected Windermere's Efforts to Force

            Mr. Rodriguez to Arbitrate with Windermere's Unfair Panel

            of Handpicked Arbitrators

 

            When Mr. Rodriguez learned that the Brady transaction closed, and unaware of Mr. Jacobsen's change to the commission disbursement form, Mr. Rodriguez asked to be paid his share of the listing commission that Windermere had agreed to pay. CP 240-41. Windermere either did not respond or did not engage in any meaningful dialogue about it. CP 241. When he realized that there was a dispute over his share of the commission, Mr. Rodriguez offered to arbitrate that dispute before a single neutral arbitrator. CP 241; TE 100. He did not want to use Windermere's arbitration procedures by which it alone would appoint three non-neutral Windermere employees to decide the matter. CP 241; TE 100. When Windermere refused, and indeed failed even to respond to Mr. Rodriguez's subsequent demand for neutral arbitration, Mr. Rodriguez filed suit in the King County Superior Court. CP 5-9.

            Windermere then moved to compel Mr. Rodriguez to arbitrate under Windermere's non-neutral arbitration procedures. CP.242. The trial court declined to compel arbitration because of the inherent unfairness in Windermere's arbitration procedures. CP 456-57. Windermere appealed to the Court of Appeals which affirmed the trial court's ruling. CP 458. This Court ruled that because the potential arbitrators were employees within the Windermere franchisee family, selected by Windermere, and have a known, existing and substantial relationship with the party-franchisee, the Windermere arbitration process did not satisfy the neutrality requirements of RCW 7 .04A.11 0(2). Rodriguez v. Windermere Real EstateIWall Street, Inc., 142 Wn. App. 833,841-42, 175 P.3d 604 (Div. 1), rev. denied, 164 Wn.2d 1017, 195 P.3d 89 (2008).

 

C.         In Retaliation Windermere Sought to Make the Litigation as

            Expensive and Time Consuming as Possible to Dissuade

            Mr. Rodriguez and other Agents from Asserting Claims

            against Windermere

 

            Throughout the course of this litigation, Windermere has deliberately sought to make it as expensive and time consuming as possible for Mr. Rodriguez.

            Initially, Windermere would not answer the Complaint or answer discovery requests until Mr. Rodriguez moved to compel it to do so. CP 242. Windermere resisted Mr. Rodriguez's efforts to serve Ms. Thompson, refusing to disclose her whereabouts even when her address was requested in discovery. CP 241. Even after the Court of Appeals issued its decision, Windermere rejected Mr. Rodriguez's renewed offer to arbitrate with a neutral third party arbitrator. CP 242. After the mandate issued, Windermere refused to stipulate to resetting the trial date. CP 243.

            When it finally answered the Complaint and began to participate in discovery, Windermere made discovery as expensive as possible. Windermere provided its discovery response in November 2008, two years after the case was filed and Mr. Rodriguez first served discovery requests. CP 243. At one point it refused to produce documents regarding Ms. Thompson's several other real estate listings and transactions unless Mr. Rodriguez agreed to pay hundreds of dollars for copying costs. CP 243. Not until the depositions of Mr. Jacobson and Ms. Thompson several months later did Windermere reveal that it routinely scanned completed transaction files onto DVDs, had all of the requested documents in electronic format and could have produced them at virtually no cost. CP 244.

            Despite Mr. Rodriguez's explicit request, Windermere never implemented litigation hold procedures to prevent the destruction of potentially relevant documents. CP at 244. In their depositions Mr. Jacobson and Ms. Thompson both admitted that they used email and routinely deleted or destroyed email, but that Windermere's counsel had never advised them to either search for relevant email or stop deleting potentially relevant email. CP 244.

            Windermere dragged its feet in scheduling depositions, provided late and incomplete discovery responses and at least twice forced Mr. Rodriguez to prepare and file motions to compel discovery on issues it ultimately did not challenge. CP 243-45. Rather than agreeing to stipulate to routine and procedural matters, Windermere forced Mr. Rodriguez to incur fees and costs to file motions that it never opposed, such as the motion to reset the trial schedule after the first appeal and the motion to amend the Complaint. CP 242-47.

            Mr. Rodriguez also incurred fees and costs preparing for and attending a mediation that failed due to Windermere's bad faith: Windermere refused to exchange written materials in advance; failed to bring to the mediation decision makers with authority to settle; and even failed to reply to Mr. Rodriguez's last offer as it promised to do. CP 246.

            In addition to the expected costs of litigation and trial preparation, because of Windermere's deliberate lack of cooperation, Mr. Rodriguez's counsel spent time and incurred fees for tasks intended to be shared by the parties, such as preparing and delivering copies of exhibits to the Court and preparing a joint statement of trial readiness. CP 247-48. Windermere and its counsel bore none of the costs of those efforts.

 

D.         In the Course of Discovery, Mr. Rodriguez Learned that His

            Partner Ms. Thompson Had Cheated Him Out of Other

            Commissions

 

            It was through one of Mr. Rodriguez's connections that the Mr. Rodriguez and Ms. Thompson as partners met Satwant Singh and the opportunities for their partnership flourished. CP 96. The partners listed several properties in the Kent Valley that traced to one of Mr. Rodriguez's referrals, each of which Mr. Singh or his company Skyline Construction purchased. CP 96. The connection with Mr. Singh proved to be particularly attractive and lucrative for Ms. Thompson. CP 97. As Ms. Thompson established her own contact with Mr. Singh, she cut her partner Mr. Rodriguez out from business opportunities. CP 97. She arranged to meet with clients without telling Mr. Rodriguez, something she had not done before. CP 97. She also concealed the existence of several property listing opportunities in the Kent Valley in disregard of her partnership agreement with Mr. Rodriguez. CP 97. Mr. Jacobsen knew that Ms. Thompson and Mr. Rodriguez were working the Kent Valley together as partners. CP 96. He did nothing to stop Ms. Thompson's behavior.

            Only during discovery did Mr. Rodriguez learn that Ms. Thompson cheated him and took entirely for herself the commissions on several properties in the Kent Valley that Mr. Singh or Skyline Properties purchased. CP 244. When Mr. Rodriguez learned of these transactions, he amended his complaint to add claims for the commissions Windermere paid Ms. Thompson that should have been shared with him under the partnership agreement. CP 476-83.

 

E.         The Trial Court Ruled in Favor of Mr. Rodriguez against Both

            Windermere and Ms. Thompson

 

            After a three day bench trial, the trial court ruled in favor of Mr. Rodriguez both as to his claims against Windermere for failing to pay his share of the listing commission on the Brady transaction and against Ms. Thompson for one half of the several other commissions that she took as her own. CP 90-102.

            The trial court found that the way in which Mr. Jacobsen stripped Mr. Rodriguez of his share of the listing commission on the Brady transaction was neither in good faith nor reasonable, and was in breach of the agreements between Windermere and Mr. Rodriguez. CP 94-95. The trial court also concluded that by concealing the existence of property sales that were rightly partnership opportunities, Ms. Thompson breached the partnership agreement and the fiduciary duties she owed Mr. Rodriguez. CP 100.

 

F.         The Trial Court Awarded Mr. Rodriguez Attorneys' Fees and

            Costs against Both Windermere and Ms. Thompson

 

            After trial, Mr. Rodriguez moved for an award of attorneys' fees and costs against both Windermere and Ms. Thompson. CP 108-22.

            The trial court awarded Mr. Rodriguez fees against Windermere pursuant to RCW 4.84.330 based on the unilateral contractual fee provision in the termination section of Windermere's contract. CP 397-402. Earlier Judge Washington had granted in part Mr. Rodriguez's motion for summary judgment ruling that Mr. Rodriguez would be entitled to an award of his reasonable attorneys' fees and costs pursuant to RCW 49.48.030 if he prevailed at trial. CP 484-87. Initially, in ruling on Mr. Rodriguez's post trial motion for fees, Judge Barnett confirmed that earlier ruling. CP 398. In amending her order awarding fees, however, Judge Barnett changed her mind finding that real estate commissions, the source of which is a third party rather than the broker, do not constitute wages or salary and Mr. Rodriguez was not entitled to fees based on RCW 49.48.030. CP 401-02.

            The trial court awarded Mr. Rodriguez fees against Ms. Thompson pursuant to Hsu v. Tang, 87 Wn.2d 796,557 P.2d 342 (1976) and Green v. McAllister, 103 Wn. App. 452, 14 P.3d 795 (2000), because her breach of fiduciary duty was tantamount to fraud. CP 397-402.

            The trial court included in the award both the attorney fees incurred at the trial level and the attorneys' fees that Mr. Rodriguez had incurred on Windermere's first appeal, calculated by a lodestar multiplier of 1.5 in recognition of the costs Mr. Rodriguez necessarily incurred to respond to the excessively aggressive tactics employed by Windermere, as well as "the contingent risk and delay in payment." CP 108, 402.

 

G.        Windermere Has Paid the Judgments Entered Against It and

            Ms. Thompson, But the Other Against Ms. Thompson Will

            Never be Paid

 

            The trial court entered two judgments. CP 436-438. The first was joint and several against Windermere and Ms. Thompson for Mr. Rodriguez's share of the listing commission on the Brady transaction and that portion of Mr. Rodriguez's attorneys' fees relating to those claims. Id. The second was solely against Ms. Thompson for Mr. Rodriguez's share of the several other commissions Ms. Thompson had received and the remaining portion of Mr. Rodriguez's attorneys' fees and costs. Id.

            Windermere paid Mr. Rodriguez the first judgment in the amount of $186,678.25, which included the principal amount, a portion of the attorneys' fees and costs, and pre and post judgment interest. CP 436-38.

            When Mr. Rodriguez sought to collect the second judgment against Ms. Thompson, she filed for Chapter 7 bankruptcy protection. See In re Thompson, Case No. 10-03978-PCW7 (W.D. Wash.). After Ms. Thompson died on November 2, 2010, and shortly thereafter the bankruptcy court discharged the trial court's judgments against her and dismissed Mr. Rodriguez's adversary proceeding for nondischargability of those judgments. Id.; see also Motion to Change Party Designation (filed Dec. 29, 2010). Mr. Rodriguez has no hope of ever collecting his second judgment.

 

IV. ARGUMENT

 

A.        Mr. Rodriguez Prevailed on a "Claim on the Contract" and is

            Entitled to Attorneys' Fees Pursuant to RCW 4.84.330

           

            1.         Mr. Rodriguez's Claims Arose out of an Agreement,

                        Mandating a Fee Award

 

            Mr. Rodriguez's claim arose directly from a contract that included a unilateral attorneys' fees provision. RCW 4.84.330 makes one-sided contractual fee provisions reciprocal, providing that in an action "on a contract" where a contract provision allows for awarding attorneys' fees and costs to one party, the prevailing party, "whether he is the party specified in the contract or [ ] not, shall be entitled to reasonable attorney's fees in addition to costs and necessary disbursements." RCW 4.84.330. An action is "on a contract" if it arises out of the contract and if the contract is central to the dispute. Seattle-First Nat'l Bank v. Wash. Ins. Guar. Ass'n, 116 Wn.2d 398, 413,804 P.2d 1263 (1991). Courts interpret this language broadly to effectuate the purpose of RCW 4.84.330, to include any action in which it is "alleged that a person is liable on a contract." Herzog Aluminum, Inc. v. Gen. Am. Window Corp., 39 Wn. App. 188, 197,692 P.2d 867 (1984); see also Scoccolo Constr., Inc. ex reI. Curb One, Inc. v. City of Renton, 158 Wn.2d 506, 520-21, 145 P.3d 371 (2006) (affirming award of attorney fees based on RCW 4.84.330, noting language of fees clause applies to enforcement of contract provisions); Quality Food Centers v. Mary Jewell T, LLC, 134 Wn. App. 814, 142 P.3d 206 (2006) (concluding contract allowed for fee award to either breaching party or party accused of breach by operation of RCW 4.84.330).

            Where an action arises out of a contract with a unilateral fee provision, an award of attorneys' fees to the prevailing party under RCW 4.84.330 is mandatory. The court has no discretion to decide whether fees should be allowed, only how much should be allowed. State v. Fanners Union Grain Co., 80 Wn. App. 287, 294, 908 P.2d 386 (1996). The statute says that the "prevailing party [ ] shall be entitled to reasonable attorney's fees in addition to costs and necessary disbursements." RCW 4.84.330 (emphasis added). As used in the statute, a prevailing party means the party in whose favor final judgment is rendered. RCW 4.84.330; Singleton v. Frost, 108 Wn.2d 723,727,742 P.2d 1224 (1987); see also Metro. Mortgage & Sec. Co. v. Becker, 64 Wn. App. 626, 632, 825 P.2d 360 (1992) (court's discretion is limited to deciding amount of reasonable fees).

            Because Mr. Rodriguez prevailed in his efforts to collect from Windermere a commission that it owed him—he is the prevailing party—and under RCW 4.84.330 he is entitled to an award of his attorneys' fees and costs. The trial court did not err in awarding his reasonable attorneys' fees, costs and necessary disbursements pursuant to RCW 4.84.330. Bloor v. Fritz, 143 Wn. App. 718, 745,180 P.3d 805 (2008); cf Mt. Hood Beverage Co. v. Constellation Brands, Inc., 149 Wn.2d 98, 121-22,63 P.3d 779 (2003).

 

            2. Section l3 of the Agreement Contains a Unilateral Fee Provision

           

            Mr. Rodriguez's claim for his share of the commission on the Brady transaction after termination of his agency with Windermere arose from the same contract clause providing for an award of attorneys' fees to Windermere for collection of any amounts due after termination. The sales person exit agreement that Windermere and Mr. Rodriguez executed incorporated the terms of Mr. Rodriguez's broker/sales associate agreement, and provided any commission due Mr. Rodriguez would be controlled by his broker/sales associate agreement. TE 5; TE 1. The agreement includes the following relevant portions of a termination provision:

 

            13. TERM AND TERMINATION. ...

 

            Pending Commissions and Transactions: Any commission pending (i.e. buyer and seller have reached mutual acceptance on a purchase and sale agreement, lease, listing or other similar document, but the subject transaction has not yet closed) at the time of termination shall be paid in accordance with this Agreement and shall be subject to settlement of Associate's obligations to Broker. Associate authorizes Broker to hold all commissions in Broker's account pending resolution of any disputes over division of the commission funds, or of any existing or potential legal actions.

 

            …Broker is authorized to compensate other such licenses in an amount determined by Broker in its sole discretion, and to deduct such amounts from Associate's share of the commission up to and including the full amount owed to Associate.

           

****

            Unpaid Obligations to Broker: Upon termination Associate will immediately pay all amounts due Broker. If Associate moves to another real estate brokerage, Associate hereby ... authorizes the new Broker to deduct and forward such shortfalls out of commissions earned at Associate's new brokerage to Broker until owed amounts are paid in full. Collection costs on amounts not paid, including attorney fees, shall be paid by Associate.

 

TE 1 at 4-5.

 

Although Windermere conveniently cites only the last clause,¹ when read in its entirety, Section 13 of the Agreement anticipates an accounting and resolution of all outstanding obligations between Windermere and an agent at the termination of their relationship. Section 13 specifically includes an attorneys' fees provision in favor of Windermere. [d. In a dispute over amounts owed between Windermere and a terminated agent, Windermere is entitled to its fees. Id. Significantly for the agent to collect amounts owed to him or her after

_______________________________

 

^I Indeed, Windermere's Appendix as submitted to the Court omits pages 3 and 4 of the agreement, discarding entirely the first part of Section 13.

______________________________________

 

termination, Section 13 obligates the agent to allow the broker to hold any unpaid commissions pending "resolution of any disputes regarding the commission funds, or of any existing potential legal actions." Id. Section 13 further authorizes the broker to designate other agents to close the terminated agent's pending transactions, and then "in its sole discretion" deduct the amounts from the agent's commission "up to and

including the full amount owed to Associate." Id.

            The practical effect of Section 13 in a dispute over money due between Windermere, as broker, and an agent after termination of the agent is this: Windermere is entitled to its attorneys' fees and it is allowed to hold any disputed funds. If Windermere sought to collect unpaid obligations from Mr. Rodriguez in the same way that Mr. Rodriguez pursued his unpaid commissions here, Windermere would be entitled to its attorneys' fees because of Section 13. Under Section 13, Windermere reserves for itself the right to recover its attorneys' fees in any dispute over money due after termination, but denies the agent the right to an award of fees in just the same dispute. This arrangement is at best, inequitable—at worst, predatory—but clearly is unilateral. This is precisely the situation RCW 4.84.330 intends to remedy.

 

            3.         RCW 4.84.330 is Founded on the Equitable Principle of

                        Mutuality of Remedy and is Intended to Remedy Biased

                        Fee Provisions

 

            RCW 4.84.330 incorporates the equitable principle of mutuality of remedy. See Kaintz v. PLG, Inc., 147 Wn. App. 782, 788-89, 197 P.3d 710 (2008) (discussing equitable underpinnings of RCW 4.84.330 and principle of mutuality of remedy). This doctrine provides for the enforceability of a fees provision even where a party successfully argues the invalidity of a contract containing the fee clause. Labriola v. Pollard Group, Inc., 152 Wn.2d 828,840, 100 P.3d 791 (2004) (citing Mt. Hood Beverage Co. v. Constellation Brands, Inc., 149 Wn.2d 98, 121-22, 63 P.3d 779 (2003)). Specifically, Washington courts effectuate RCW 4.84.330 and the principle of mutuality of remedy in order to ensure "no party will be deterred from bringing an action on a contract or lease for fear of triggering a one-sided fee provision." Wachovia SBA Lending, Inc. v. Kraft, 165 Wn.2d 481,489,200 P.3d 683 (2009); see also Zuver v. Airtouch Commc'ns, Inc., 153 Wn.2d 293,317-18, 103 P.3d 753 (2004) (emphasizing long history of mutuality of obligation in Washington courts); Mt. Hood Beverage Co., 149 Wn.2d at 121-22 (expanding scope of principles underlying mutuality of remedy doctrine and RCW 4.83.330 to apply to statutory awards of attorney's fees).

            These policies are especially pertinent to a case such as this. If not for RCW 4.84.330 and the mutuality of remedy doctrine, terminated agents such as Mr. Rodriguez would be deterred from attempting to collect amounts rightfully owed for fear of exactly what happened here, Windermere would deliberately run up the costs with no risk of having to pay fees if it lost, making the agent's claim economically untenable. The agent also would be deterred by the possibility of a counterclaim that could trigger an award of fees in Windermere's favor, a remedy that the agent could not obtain. By the same token, Windermere, if it did not just keep all amounts owed, could sue the terminated agent and bully the agent with the threat of an award of attorneys' fees against the agent, a remedy that Windermere seeks to deny the terminated agent. In other words, the equitable principles underlying RCW 4.84.330 and the doctrine of mutuality of remedy warrant the precise result reached by the trial court in this case. The trial court made reciprocal the award of attorneys' fees in a dispute over amounts owed between Windermere and a terminated agent.

            This concept of mutuality of remedy is especially important in the master/servant relationship. The master (whether an employer or contractor for labor services) can unilaterally adopt and change the terms and conditions of employment. See, e.g., Thompson v St. Regis Paper Co, 102 Wn.2d 219,229,685 P.2d 1081 (1984); Gaglidari v Denny's Restaurants, Inc., 117 Wn.2d 426,434,815 P.2d 1362 (1991). Washington is, "a pioneer in the protection of employee rights." Drinkwitz v. Alliant Techsystems, Inc., 140 Wn.2d 291,300,996 P.2d 582 (2000). Pursuant to these policies, Washington courts have held employment contract clauses "may be so one-sided and harsh as to render them substantively unconscionable," without a finding of procedural unconscionability. Adler v. Fred Lind Manor, 153 Wn.2d 331,346-47, 103 P.3d 773 (2004); see also Walters v. AAA Waterproofing, Inc., 151 Wn. App. 316, 321, 211 P.3d 454 (2009) (finding fees provision may be substantively unconscionable if it "effectively undermines an employee's ability to vindicate his statutory rights"); Ingle v. Circuit City Stores, Inc., 328 F.3d 1165,1173-74 (9th Cir. 2003) (concluding employer-employee contract to arbitrate creates rebuttable presumption of substantive unconscionability unless employer could prove bilateral effect).

            Windermere has taken advantage of its position as master earlier in this case when it sought to impose on Mr. Rodriguez an unconscionable arbitration agreement. It is continuing its efforts by claiming that only it can have the advantage of a fee shifting provision in its agreements with its sales agents. But Washington courts interpret contracts to render them enforceable "whenever possible." Patterson v. Bixby, 58 Wn.2d 454,459, 364 P.2d 10 (1961).

            Here, Windermere's asks this Court to read the contract in a way that would render the contract substantively unconscionable as a unilateral fees provision, which this Court should decline to do. In light of these principles, there are only two possibilities: either Windermere's fees provision may be upheld as crafted to intentionally avoid the effect of RCW 4.84.330, or the clause must have bilateral effect under Washington law.

 

 

ROBERTO RODRIGUEZ RESPONDENT'S BRIEF CONTINUED, CLICK HERE

DOWNLOAD A COMPLETE PDF COPY OF THE RESPONDENT'S BRIEF HERE

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The Windermere Real Estate Relocation Rape Case:

Court Declares that Windermere "...condoned a rape by a business colleague..."

 

Editorial Preface: The incredibly violent and insidious psychological ramifications of rape, connected through an “abusive work environment” serves as an unfortunate yet credible subtext for the way in which Windermere Real Estate treats employees and damaged customers alike: Windermere’s application of aggressive, wasteful and mendacious litigation to stall and ruin innocent consumers, serves as the coercive metaphor of corporate power and arrogance: Windermere has no concern for the social damage it has done to people or communities. It cares only about how to manipulate the law and the courts to avoid any legal responsibility.

 

(Above L to R) Windermere CEO Geoff Wood (far left) is currently listed as a Governing Person of Windermere Relocation. Peggy Scott (second from left), also a current Governing Person of Windermere Relocation, "... did not give Little any advice about going to the police, and she did not conduct an investigation of Little's complaint or any follow-up interview with Little." Windermere General Counsel, attorney Paul Drayna (third from left) is listed as the registered agent of RELO LLC, the current entity name of Windermere Relocation. Windermere Founder John W. Jacobi (fourth from left) along with Gayle Glew (far right) are listed as Governing Persons of Windermere Relocation during the Little case. Glew told Ms. Little he did not want any "clouds in the office," and subsequently, after she would not accept a pay cut, that she should clean out her desk.

All citizens who abhor such treatment of women in the workplace should recall Maureen Little v. Windermere Relocation when choosing real estate services. WindermereWatch visitors will also want to read the United States District Court of Appeals Ninth Circuit's Order and Amended Opinion from the Little case.

 

Summarized and excerpted from a decision by the U.S. Court of Appeals

 

Maureen Little was employed by Windermere Relocation Services (“Windermere”) as a Corporate Services Manager, a position that required her “to develop an ongoing business relationship and relocation contacts with corporations in order to obtain corporate clients needing relocation services for their employees.” Until she was terminated, she received only positive feedback from her supervisors. Windermere’s records confirm that during the relevant period, Little had the best transaction closure record of all corporate managers by a large margin.

Unlike the other managers, Little’s employment contract provided that Little would receive $2,000 monthly, plus a $1,000 monthly override and $250 per closed sale. The override was based on the assumption that Little would close four transactions per month, with a provision for rollover when she did not make the target. According to Windermere President Gayle Glew, the other managers had not received the $1,000 override.

One of Windermere’s clients was the Starbucks Corporation. Some time in 1997, Little performed some relocation services for Starbucks Human Resources Director, Dan Guerrero, on a contract basis, and she learned from him that Starbucks was dissatisfied with its primary relocation provider. Glew told Little that he would “do whatever it takes to get this account” and that Little should “do the best job she could.” Thus, little believed that, as part of her job, she was to build a business relationship with Guerrero to try and get the Starbucks account, and she had at least two business lunches with Guerrero toward this end.

On October 14, Little accepted Guerrero’s invitation to discuss the account at a restaurant. After eating dinner with Guerrero and having a couple of drinks, Little suddenly became ill and passed out. She awoke to find herself being raped by Guerrero in his car. She fought him off and jumped out of the car, but again she became violently ill. Guerrero put her back in the car and took her to his apartment, where he raped her again. Little fell asleep, and when she awoke he was raping her again. Afterward, he showered and drover her to her car.

Little was reluctant to tell anyone at Windermere about the rape because, in her own words, “I knew how important the Starbucks account was to Mr. Glew. Mr. Glew would ask me on a consistent basis the status of the account and I was afraid that if I told him about the rape, he would see me as an impediment to obtaining the Starbucks account.” This belief was reinforced when, a few days after the rape, Little reported the rape to Chris Delay, Director of Relocation Services (apparently not one of Little’s supervisors), and Delay advised her not to tell anyone in management. Little believed that Delay feared “what might happen to [Little] if [she] did tell.”

On October 23, about nine days after the rape, Little reported it to Peggy Scott, the Vice President of Operations, who was designated in Windermere’s Harassment Policy as a complaint-receiving manager. Little described Scott’s response:

She came out around the desk and I could tell she was upset and she just gave me a hug and said she wished there was something she could do. She didn't understand what I was going through. She asked me if I was in therapy. Then she proceeded to tell me she wouldn't say anything to [Glew] unless I proceeded to seek legal action [against Dan Guerrero].

 

Scott told Little that "[s]he thought it would be best that [Little] try to put it behind [her] and to keep working in therapy," and that she should discontinue working on the Starbucks account. She did not give Little any advice about going to the police, and she did not conduct an investigation of Little's complaint or any follow-up interview with Little. Scott testified in her deposition that, because the rape occurred outside the "working environment," she believed that it fell outside the scope of Windermere's Harassment Policy.

 

Despite Little's supposed removal from the Starbucks account, Glew continued to ask her about the status of the Starbucks account during the next six weeks. "[As of December 2,] Gayle was asking me questions about Starbucks ... a couple of times every month to see what the status was." Concerned by Glew's questions, Little told her immediate supervisor, Linda Bellisario, the Vice President of Sales and Marketing, on December 2, 1997, about the rape. Little had been reluctant to tell Bellisario because she "felt that [Bellisario] would immediately go to Gayle and Gayle would terminate my position.... I knew how much this account meant to him. He said he would do whatever it took to get this account." Bellisario told Little to inform Glew of the incident.

 

When Little told Glew of the rape, which, according to Glew, was the first he had heard of it, Glew's" immediate response was that he did not want to hear anything about it." He told Little that she would have to respond to his attorneys. Glew then informed her that he was restructuring her salary from $3,000 monthly to $2,000 monthly plus $250 per closed transaction. The pay reduction was effective immediately and non-negotiable. Bellisario, who was present at that portion of the meeting, appeared "surprised and upset" to Little.

 

Little found the pay cut unacceptable, and Glew told her to go home for two days to think it over "because he did not want any `clouds in the office.'" When Little still found the pay cut unacceptable two days later, Glew told her it would be best if she moved on and that she should clean out her desk.

 

Little brought suit against Windermere, alleging unlawful discrimination and retaliation in violation of Title VII, 42 U.S.C. § 2000e, and the Revised Code of Washington § 49.60; wrongful discharge in violation of public policy; and intentional, reckless, and/or negligent infliction of emotional distress. The district court granted summary judgment in favor of Windermere on all four claims.

 

Little appealed dismissal of her claims, and the appeals court reversed in part, and ruled:

 

In sum, taking the facts in the light most favorable to Little, because her employer effectively condoned a rape by a business colleague and its effects, Little was subjected to an abusive work environment that "detract[ed] from [her] job performance, discourage[d] [her] from remaining on the job, [and kept her] from advancing in [her] career."

 

Incredibly, Windermere asked for a rehearing, but "...the panel has voted to deny the petition for rehearing and to reject the suggestion for rehearing en banc.

 

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WINDERMERE: AMERICA'S PREDATORY REAL ESTATE ENTERPRISE

Consumer advocates, legal experts and elected lawmakers all agree that the American real estate industry demands greater regulation to protect consumers from the human disaster of real estate fraud perpetrated by unethical realtors employed at companies like Windermere Real Estate. Windermere manipulates our clogged, inundated courts and the justice system to stall, wear down and financially exhaust victimized consumers, many of whom are wiped-out by the cost of pursuing civil justice in a process where innocent victims must CHASE perpetrators of real estate fraud through the courts AFTER a fraudulent offense has been committed. Acts of fraud are so common and widespread throughout the Windermere real estate network, that the defense of real estate fraud has become has become just another bottomline expense on the Windermere balance sheet. And the litigation nightmare of real estate fraud can happen to anyone who deals with Windermere Real Estate. It could happen to you. Windermere is by far the most unethical, deceitful, and culturally toxic real estate company operating in the United States. Windermere knowingly, deliberately, and unabashedly profits on corrupt franchise owners, brokers and agents with proven histories of fraud and ethical misconduct, many of whom are profiled in the pages of WindermereWatch.com. Despite Windermere's well-documented assault on victim speech rights, more and more unconscionable cases of Windermere fraud continue emerging.

Windermere is headquartered in Seattle, at franchiser Windermere Services Company. It was founded by John W. Jacobi, and he has kept the company a private, family-owned enterprise, eluding the transparency and ethical accountability required by stockholders. For decades, Windermere has harnessed the art of positive PR, affixing itself—however superficially—to community art events, the homeless, and even an annual college rowing competition which opens Seattle's boating season—the Windermere Cup—irresponsibly promoted by, and in conjunction with, the University of Washington. But those are the disingenuous and cynical sideshows created by an adept market manipulator, shown only briefly to the public, to obscure and obfuscate Windermere's true predatory nature.

FRANCHISER WINDERMERE SERVICES' MANAGEMENT TEAM AND DESIGNATED GOVERNING PEOPLE: EXPERTS IN MARKETING FRAUD, ABUSE OF THE LEGAL PROCESS, AND AT COERCING DAMAGED WINDERMERE CLIENTS INTO SILENCE BY SUPPRESSING THEIR SPEECH RIGHTS

The shameless greed and repugnant ethics of Seattle's Jacobi family, deliberately profiting on the loss and suffering of Windermere victims through commissions on the fraudulent home deals and unlawful misconduct of dishonest Windermere agents, brokers and franchise owners. Forget human decency, commercial reputation or social responsibility—it's all about the money.

Before turning the business over to his children and son-in-law, Windermere founder John W. Jacobi (left) simply ignored any complaints of fraud from Windermere victims, sending them straight to the lawyers. Yet despite claims of retirement, Jacobi is still indeed quite active at franchiser Windermere Services Company:

In Complaint 10-2-36192-8 SEA, filed in King County Superior Court on October 12, 2010, Windermere Services Company has sued former Windermere Puyallup Canyon Road owner Joe Maxwell for default on an “Unconditional Guaranty of Payment” promissory note. The Maxwell Answer and Counterclaims state that the “Plaintiff's [Windermere Services Company] claims are barred by Plaintiff’s fraud, duress, and unclean hands,” and alleges $4,000,000 in damages and violation of Washington's Franchise Investment Protection Act; and also that "The alleged Note and Guarantee are unconscionable and unenforceable." Maxwell's Counterclaims state "6. The WPCR Operating Agreement contains a provision granting Jacobi a special veto power which among other things, states that the company shall conduct its business and manage its affairs in accordance with the directions of Jacobi and all management decisions are subject to Jacobi’s review," and "13. In early 2006, WSC and Jacobi decided to open another WSC office in the territory in which WPCR was operating, despite the objections of Maxwell. As a result of the opening of this new WSC office, WPCR lost a significant number of its real estate agents and revenue that transferred to the new office in Graham, Washington," and "14. As a direct result of these actions taken by WSC and Jacobi, WPCR was left with a large debt burden and overhead, and WPCR’s revenue was significantly reduced... 22. On September 14, 2010, Maxwell heard from a real estate agent working at WPCR that the agent had received and email from WSC notifying him WPCR’s franchise had been terminated. This notice was sent to WPCR’s real estate agents before Maxwell learned of the termination of WPCR’s franchise." Read the complete report on this case here.

Jacobi's Washington Loan Company is also currently being sued for Intentional Misrepresentation—read that report here. And the Windermere affiliated service company, Commonwealth Land Title Company of Puget Sound, has recently been found negligent by a jury who awarded the third-party plaintiffs $1,190,000. Read the Commonwealth report here.

 

Current Governing Person and Windermere Services Company CEO Geoffrey P. Wood (left) is married to John W. Jacobi's daughter, Jill Jacobi-Wood. Wood is the chief architect of Windermere marketing fraud, inducing business volume through—among other fraudulent promotion—an express warranty of "The highest ethical standards. Uncompromising honesty and integrity." When called upon to honor his company's warranty, Wood instructs Demco lawyers—led by Matthew F. Davis–to sue vocal victims for libel and defamation. Wood is also a Governing Person of Windermere Relocation, the subject enterprise of Windermere's employee rape case. He was briefly a real estate sales person in 1994, but that license was CANCELLED in 1995, and Wood currently has no real estate license of any kind that WindermereWatch can find.

 

Governing Person Jill Jacobi-Wood (left), Windermere Services President, is a licensed real estate broker in Washington State, and as such is subject to the statutory condition of RCW 18.86.030 "(d) To deal honestly and in good faith." For her part in Windermere's marketing fraud and malfeasance, Jacobi-Wood's RE license should be cancelled by the Washington State DOL's real estate division. By promoting honesty and integrity—while in reality—she is suing and coercing Windermere victims to shutup about their Windermere experience, Jacobi-Wood is hardly dealing honestly and in good faith.

 

 

Governing Person John O'Brien "OB"Jacobi (left) is General Manager of franchiser Windermere Services Company and also has many Windermere realty brokerage offices. He's a licensed real estate broker who is also called upon by statutory law to "Deal honestly and in good faith." But John "OB" Jacobi instead promotes fraudulent claims of honesty and integrity, and falsely sues victims of Windermere misconduct for libel and defamation to intimidate them and coerce their silence. Then this junior Jacobi runs away and voluntarily dismisses his own mendacious lawsuit when a victim refuses to sign Windermere's dark clause settlement agreement that has cost the victimized party so much distress and money and to defend.

 

 

Windermere Services Governing Person and attorney—WSBA# 26636—Paul Drayna (left) has even more stringent ethical requirements placed upon him through his collateral professions of Lawyer and Notary Public; and Drayna is also bound by the Model Rules of Professional Conduct. But Mr. Drayna is not just practicing marketing fraud at Windermere. As Windermere in-house counsel, Drayna oversees Windermere's legal strategy of abusing process by falsely suing victims for libel and defamation, and then attempting to intimidate and coerce those victims out of their speech rights and into Windermere's Dark Clause silence agreement. When victims WON'T sign the Windermere Dark Clause, Drayna runs away too, and voluntarily dismisses his own company's lawsuit under Civil Rule 41—but only after first costing the victim thousands to defend the phony lawsuit. Drayna is even copied on the mendacious, Demco-authored settlement documents meant to quash speech rights and be signed by Windermere victims.

 

WINDERMERE'S DEMCO LAW FIRM: ESCHEWING ETHICS and DOING WHAT OTHER LAWYERS JUST WON'T DO

 

Attorney and multi-office Windermere broker John Demco (left) is the ethically-elastic Windermere kingpin lawyer who operates Demco Law, Windermere’s in-house legal firm, whose primary job is to stall and outspend small fry consumers damaged by dishonest Windermere brokers, agents and franchise owners. When an innocent real estate consumer has the misfortune to suffer one of Windermere’s many bad apples, Demco Law Firm will refuse to settle the matter forthrightly, no matter what conspicuously unlawful or offensive conduct the agent or broker has committed. Demco and Windermere will force the aggrieved party to sue or swallow their damage and go away—standard Windermere operating procedure.

 

WindermereWatch has compiled voluminous evidence that Windermere-Demco attorney Matthew F. Davis (left), WSBA# 20939, is the kind of lawyer about which jokes are coined. Davis is franchiser Windermere Services' frontline bully—the guy in the legal trenches actually wrecking lives, making threats, and suing victims who speak out. When Shakespeare was recommending "The first thing we do, let's kill all the lawyers," in Henry the Sixth, Part 2, he was talking about egomaniacal lawyers like Matt Davis.

Attorney Matt Davis of Windermere's Demco Law Firm is so unethical, so deceitful and intimidating, that he's famous in law circles. As Windermere-Demco's lead attorney, Matthew F. Davis is renown for his dishonesty, dubious legal tactics, lack of decency and disrespect for the rules of professional conduct. He will do absolutely anything to win—without regard for truth or justice. He will lie to courts and opposing parties. He will file fallacious and erroneous documents with the court. He will email opposing parties telling them not to hire a lawyer when he has just served them a lawsuit. He will call a judge's chambers and request more time without informing the opposing party. He will file orders for a bench trial when he knows a jury trial has been demanded and paid for. He will trick, stall, coerce, menace and threaten. He will invent and extend mendacious Windermere litigation and abuse the legal process for no other reason than to exhaust an opponent’s pocketbook. If he can, he will get YOUR attorney to quit—a favorite tactic.

Windermere, Davis and Demco Law will push a $5 cat poop case all the way to the state supreme court just to avoid paying damages—because it’s all in the Windermere operating budget. And in the end, Windermere and Davis will try to coerce silence about your Windermere experience by trying to make you sign a "settlement" agreement that terminates your speech rights, so you can't ever inform the public about your Windermere debacle. What if you DON'T sign that you'll shut up, and then SPEAK UP instead? Windermere-Demco's Matt Davis will sue you for libel and defamation, then run away and dismiss his own lawsuit on the eve of trial—because after all—you're telling the truth.

Windermere's Clear and Overt Marketing Fraud:

"THE HIGHEST ETHICAL STANDARDS. UNCOMPROMISING HONESTY AND INTEGRITY."

—The Windermere Real Estate Mission Statement

Windermere widely promotes its deceptive express warranty in sales documents and on the internet which states "We are committed to... The highest ethical standards. Uncompromising honesty and integrity." In other Windermere promotion, like the Puget Sound Business Journal, Windermere CEO Geoff Wood is quoted as saying "In the real estate business somebody's word is very important. If you say you're going to do something, you've got to do it." The article goes on to say, "Geoff oversees marketing, legal, financial and internet development services throughout the Windermere network..." Mr. Wood claims absolute dominion over both Windermere legal and internet strategy, making him chief architect of Windermere marketing fraud.

Effective reportage can be harsh in recounting facts, but it must be said in consideration of all the Windermere victims profiled here who truly sought Windermere's vaunted honesty and integrity, that Windermere Services CEO Geoffrey P. Wood is simply lying when he states his company's utterly false and fraudulent commitment to honesty and integrity. He both lies and deceives again when he says that "In the real estate business somebody's word is very important. If you say you're going to do something, you've got to do it." Wood clearly doesn't do what he says he's going to do—be committed to uncompromising honesty and integrity. Wood himself is indeed IN the real estate business and his word is absolutely no good at all. He sues victims of Windermere misconduct for trade libel and defamation to shut them up, and then he tries to use the legal system to suppress victims' speech rights when they ask him to actually perform on the warranty he promotes. As this website proves, Mr. Wood does anything BUT what he says he's gonna do. Far from providing victimized Windermere customers a commitment to high ethical standards, honesty and integrity, Wood and Windermere run away and hide behind their lawyers when innocent consumers are ruined by their Windermere experience.

John W. Jacobi, Geoff Wood, his wife Jill Jacobi-Wood, and governing cohorts John O'brien "OB" Jacobi and attorney Paul Drayna have gone to the absolute ends of the earth in stonewalling, ignoring, denying and fleeing any and all responsibility for Windermere wrongdoing and misconduct. When called upon by victimized Windermere consumers to make good on its warranty of honesty and integrity, Windermere even states in legal pleadings that Windermere agents are NOT agents of Windermere at all—but independent contractors. As the legally-designated Governing People and top managers of the Windermere empire who drive policy, ethics and market promotion, it demands repeating that John W, Jacobi, Geoff Wood, Jill Jacobi-Wood, John OB Jacobi and attorney Paul Drayna are all clearly lying when they promise high ethical standards and uncompromising honesty to the public and consumers of real estate services.

Protect your life, home, family and future by cancelling or not renewing your Windermere listing. Don't risk doing business with Windermere Real Estate, the brand built on lies, fraud and ruined lives. Refuse to fund public predator Windermere Real Estate with commission from the sale of your home.

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Is WindermereWatch.com of social benefit to consumers and the public? You decide:

Windermere Real Estate is one of our country’s largest real estate companies and widely promotes a fraudulent express warranty that states “We are committed to... The highest ethical standards. Uncompromising honesty and integrity.” The definition of an express warranty from Black's Law Dictionary is: "A warranty created by the overt words or actions of the seller. • Under the UCC, an express warranty is created by any of the following: (1) an affirmation of fact or promise made by the seller to the buyer relating to the goods that becomes the basis of the bargain."

But when customers are victimized by dishonest Windermere brokers and agents, and complain in writing through legal counsel to franchiser Windermere Services Company, it is absolutely silent in the face of clear and convincing evidence, and forces the customer to sue or go away. In many cases, unsuspecting consumer lives are thrown into complete chaos through costly litigation; and also because the subject homes may actually be uninhabitable or unserviceable for reasons about which Windermere knew and had a legal obligation to disclose—but did not. For some victims, the long and expensive litigation forced upon them even results in bankruptcy and homelessness. Despite their clear evidence, many victims go on to lose in court because they can't afford attorneys or have no legal experience, and Windermere exploits those impediments to endless advantage—lives, homes, and personal finances are ruined forever. And Windermere expects those victims to just go away without their lives and homes, merely for buying a house through Windermere Real Estate, innocently.

Although such irrefutable evidence of Windermere broker/agent misconduct has been presented to franchiser Windermere Services Company, it knowingly continues collecting commissions from dishonest agents and brokers by deliberately passing them on to other unwitting consumers. Just one example is Windermere S.C.A. Redmond's Paul Stickney, who received a $522,200 court judgment for not disclosing a conflict of interest, but is still producing commissions for his Windermere SCA franchise, and Windermere Services Company. Is that the "Highest ethical standards. Uncompromising honesty and integrity?" You may want to search and visit more websites about Windermere's predatory business conduct.

When victims use the media to report their Windermere experiences honestly, Windermere sues them for libel and defamation through false lawsuits to intimidate, silence, and hush bad PR—read one of those lawsuits here. It then tries to coerce victims into signing a “dark clause settlement agreement” that permanently terminates their speech rights—read some of those "settlement" agreements here. Through an expensive and emotionally distressing roller coaster ride with Windermere's nasty Demco lawyers, a victim of Windermere fraud is told they will be taken all the way to trial on trumped-up libel and defamation charges, and if they don't sign the dark clause, their life and future will be ruined. When a victim persists in refusing to sign, Windermere voluntarily dismisses its own lawsuit under Civil Rule 41, just before trial, after costing the victim years and yet thousands more to defend against the false action. This predatory legal tactic is known as abuse of process or malicious prosecution. In one example cited below, franchiser Windermere Services Company served an outspoken victim a lawsuit for libel and defamation, and then immediately sent them an email instructing that they "...need not hire an attorney," and further stating, “…we will try to resolve this directly and outside the legal system.”

Every Windermere office in every state is legally tied to franchiser Windermere Services Company's fraudulent express warranty, false advertising, predatory conduct and policies through privity and its pecuniary franchise agreement. Some legal observers believe that Windermere's conduct has RICO and Civil Rights violation implications. If you have recently purchased a Windermere franchise without having been disclosed Windermere's falling brand value, PR decline, and its adverse website problems, click here for its duty of disclosure under Federal Trade Commission rules. Proof that Windermere Services Company knew about WindermereWatch.com in March of 2007 is in this document.

Windermere Real Estate is a textbook corporate predator who operates franchises in Washington State, Oregon, California, Arizona, Nevada, Utah, Idaho, Montana, Hawaii and British Columbia. Windermere repeatedly makes the false claim that it has offices in Wyoming, but it does not. If you’re buying or selling property through ANY Windermere office, a percentage from your transaction will be used by franchiser Windermere Services Company to silence and financially ruin innocent parties who’ve encountered Windermere fraud. Windermere won't pay legitimate damages or acknowledge wrongdoing, and will stall settlement of cases all the way to state supreme courts, a legal strategy that Windermere routinely employs to bankrupt victims and exhaust their resources.

We believe the information presented here is of profound social benefit to consumers and the community, and we are dedicated to providing it.

THROUGH FEES AND COMMISSIONS PAID TO FRANCHISER WINDERMERE SERVICES COMPANY, EVERY WINDERMERE NETWORK OFFICE IN EVERY STATE IS AN ENTHUSIASTIC PARTNER AND KNOWING ACCESSORY TO WINDERMERE MARKETING FRAUD AND ITS PREDATORY POLICIES

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