New York State Comptroller Thomas DiNapoli is looking on eXp Realty shareholders to dam the corporate’s plan to move its state of incorporation from Delaware to Texas, arguing that the brokerage ought to handle inner tradition points slightly than search a extra favorable dwelling base.
The pushback comes after allegations of sexual assault and associated shareholder litigation put the cloud-based brokerage below intense scrutiny, in keeping with the New York Times. DiNapoli framed the brokerage’s transfer as an try and sidestep accountability.
eXp, one of many largest residential brokerages within the nation, has confronted three separate lawsuits tied to convention and recruiting-event conduct. Two filed in California in 2023 and one other filed in Florida final 12 months noticed girls allege the corporate enabled a sample of drugging and rape round these occasions.
The allegations largely middle on two former brokers — Michael Bjorkman and David Golden — who had been reportedly excessive earners producing important income for the agency. The lawsuits allege the corporate allowed them to stay affiliated with eXp properly after management was alerted to complaints about them.
The controversy spilled into company governance when two shareholder pension funds filed swimsuit in Delaware, the place eXp’s mum or dad firm is included. The criticism accuses the corporate of risking investor worth by way of a “purposeful choice to disregard studies of felony abuse.”
After a choose allowed that case to go ahead, eXp founder and chief govt officer Glenn Sanford introduced the corporate would reincorporate in Texas, which is broadly considered as a friendlier jurisdiction for firms going through shareholder challenges than Delaware, lengthy the default for company domiciles.
In a press release urging shareholders to vote down the transfer, DiNapoli stated traders have an obligation to carry eXp accountable. That features the New York State Widespread Retirement Fund, which held practically 27,000 shares of eXp’s mum or dad firm finally look.
Responding to the missive, an eXp govt stated in a press release that the Texas reincorporation dates again months earlier than Sanford’s announcement and claimed an outdoor investigation “didn’t substantiate the claims that firm management was conscious of and didn’t act on allegations of assault.”
A vote on the reincorporation is about for the tip of subsequent week on the firm’s annual assembly. A majority of shareholders would want to approve the transfer.
Learn extra
eXp plans “Dexit” to Texas from Delaware after court revives “rape culture” claims
Former eXp broker files sexual assault lawsuit against the firm
Glenn Sanford back in the CEO saddle at eXp
