clients. For instance, Mr. Deiter signed documentation acknowledging that he was prohibited
from engaging in such inappropriate conduct while performing his duties at the West Chester
Spa. 53 Massage Envy Spa Code of Conduct, attached as Exhibit 3.

At the time Mr. Deiter allegedly improperly touched Plaintiff. Spa Dogs had notified
MEF that another client had lodged a complaint against Mr. Deiter on February 6, 2014 arising
out of a massage occurring on November 26, 2014. Ex. 1 (Hansen Aff.) at 1 106, Exhibit 
(Incident Reports), Spa Dogs. however, reported that it had conducted a thorough investigation,
which included interviewing Mr. Deiter, making several attempts to interview the complainant,
and suspending Mr. Deiter until a determination could be made. EX. 1 (Hansen Aff.) at 11 107,
Exhibit (Incident Reports). Spa Dogs represented to MEF that, based on its interactions
with the complainant, the complainant was not being truthful and therefore made the
determination to continue Mr. Deiter's employment. Ex. 1 (Hansen A3.) at 1| 108, Exhibit 
(Incident Reports). MEF did not participate in that investigation or determination with respect to
Mr. Deiter's continued employment. Ex. 1 (Hansen Atr) at '1 109. MEF was not aware of any
other allegations of inappropriate conduct being lodged against Mr. Deiter at the time Mr. Deiter
allegedly improperly touched Plaintiff. EX. 1 (Hansen Aff.) atll 110.

After this lawsuit was filed, MEF learned that Spa Dogs had been made aware of another
client lodging a complaint against Mr. Dcitcr in April 2015 arising out of a December 2014
massage. Ex. 1 (Hansen Aff.) at 1 l. Spit Dogs did not notify MEF ofthe allegations. and its
failure to do so constituted a Violation of one of the mandatory System Standards. EX, 1 (Hansen
Aff.) at ll 1 12. As mentioned above, MEF's rights with respect to the Violation were restricted to
those rights granted to it by the Franchise Agreement. Ex. 1 (Hansen Aff.) at 113. Accordingly,
MEF took the required steps to terminate the Agreement. Ex. 1 (Hansen Aff.) at 11

114, Exhibit D.

LEGAL STANDARD

A court should grant summary judgment "if, afier the completion of discovery rclevant to

the motion, including the production of expert reports, an adverse party who will bear the burden

Case ID: 150703385

39mm