Shareholders are suing eXp for allegedly mishandling sexual assault cases

Shareholders at eXp World Holdingsthe parent company of eXp Real Estateare dissatisfied with the recent wave of lawsuits and media coverage the company has received regarding allegations of sexual assault and harassment.

Wednesday has the Los Angeles City Employees’ Retirement System (LACERS) and the Building Trades Pension Fund of Western Pennsylvania Glenn Sanford, Jason Gesing and five other board members for eXp World Holdings sued and accused of mishandling sexual abuse allegations uncovered by a an expose from The New York Times and a series of lawsuits.

LACERS has been a shareholder in eXp since 2019, while the Pennsylvania pension fund joined in 2021.

In the lawsuit, the shareholder plaintiffs allege that Sanford and the other board members breached their fiduciary duty by failing to ensure that eXp had “reasonable reporting and information systems” that would allow employees and agents to inform leaders about sexual assault and misconduct.

Additionally, the filing alleges that Sanford and eXp’s board created a “culture of fear and retaliation” because they blocked efforts to improve the company’s reporting and response systems for employees and agents who experienced sexual assault and intimidation.

According to the filing, the company’s diversity director, who would handle the complaints, “confirmed that he was never allowed to learn about the anonymous email process. He was able to poke holes in the company’s policies, and every time he questioned a policy he was told he didn’t understand the real estate industry.”

“Every time he tried to get a policy approved, he faced pushback and was told that this was not the way things were done at eXp,” the complaint said.

The shareholder lawsuit focuses on three lawsuits known as Roberts, Acevedo and Carter. In all three lawsuits, eXp agents and recruiters are accused of sexual harassment and assault. The Carter lawsuit was dismissed in June 2024.

The plaintiffs in the Roberts and Acevedo cases allege that former eXp agents and recruiters Michael Bjorkman and David Golden gave them substances at recruiting events that caused them to black out. The women claim they were abused unconscious by Golden and Bjorkman. Sanford and eXp are named as defendants in both lawsuits.

In an amended complaint, plaintiff Anya Roberts alleges that eXp “at worst knew of, encouraged, and permitted abhorrent conduct; or at least recklessly ignored and willfully turning a blind eye to “things that are on the wrong side of the law.”

The plaintiffs in these two cases allege that the brokerage firm’s inaction regarding their complaints about Bjorkman and Golden was due to the money the men brought in through eXp’s revenue sharing program. The program offers agents a cut of company revenue for every successfully completed transaction by an agent in their downline stream.

The shareholders point out that Sanford, Gesing and board member Eugene Frederick benefit most from the revenue share program. According to the filing, Sanford and Fredrick earned bonuses of $1.5 million and $3.9 million, respectively, in 2020, while Gesing received a bonus of $545,506 in 2021.

The filing also noted that Sanford recently “ceased formally participating” in the revenue sharing program. But filings with the Securities and Exchange Commission (SEC) show that Sanford’s compensation package has been updated to include a cash bonus that reflects the difference between his salary and what he received through the revenue sharing program.

The shareholders allege that the defendants “prioritized their bonuses and boys’ club over the basic safety of the company’s employees and compliance with the law. Their bonuses are calculated based on the revenue share income generated by the influencers in their downline and can be very significant as the company generates approximately $28 million per month in revenue share income.”

“A top influencer leaving the company would be catastrophic for Sanford, Frederick and Gesing’s revenue share, as it would jeopardize the revenue share revenue generated by that influencer and all agents in their downline,” the filing said.

“Defendants chose to cover up this sexual misconduct, allowing it to continue and jeopardizing the safety of the real estate agents who are the lifeblood of the company. The board ignored these reports and officers’ pleas for redress. Instead, the defendants orchestrated a cover-up to protect the attackers, prioritizing the profits that inflated executive bonuses over officer safety and compliance with the law — and basic human decency,” the filing said.

In addition, the shareholders stated that Sanford and the board, by failing to fulfill their fiduciary duty, caused the company to suffer “significant harm” to its reputation and monetary value.

The shareholder plaintiffs are asking Sanford, Gesing and the other defendants to return the profits, benefits and other compensation they paid during the alleged abuse. In addition to damages and costs associated with the lawsuit, they also want the company to establish a viable sexual assault and harassment reporting system.

In response by email to HousingWirea spokesperson for eXp World Holdings wrote that the company takes its “responsibility to promote a safe and inclusive environment very seriously.”

“eXp Realty has zero tolerance for abuse, harassment or misconduct of any kind – including by the independent real estate agents who use our services,” the spokesperson wrote. “The claims in this case arise from alleged attacks by independent brokers – which we have handled with seriousness and deep respect, in accordance with our company values, policies and procedures.

“The company will continue to do its best to ensure we create a safe environment that provides our employees and agents the opportunity to succeed.”