Schneider v. OSG, LLC

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SPENCER LEE SCHNEIDER, Plaintiff, v. OSG, LLC, d/b/a Odyssey Study Group, LORRAINE IMLAY, individually and as a fiduciary of the Estate of Sharon Gans Horn, MINERVA TAYLOR, individually and as a fiduciary of the Estate of Sharon Gans Horn, and GREGORY KOCH, Defendants.

No. 22-CV-7686 (AMD) (VMS)

United States District Court, E.D. New York

March 27, 2024

MEMORANDUM DECISION AND ORDER

ANN M DONNELLY UNITED STATES DISTRICT JUDGE

For more than 23 years, the plaintiff was a member of the Odyssey Study Group (“OSG”), which he alleges was “a cult” in which the organization and its leaders coerced him into “perform[ing] thousands of hours of unpaid labor and services by instilling in him a fear that if he did not perform such labor and services, he would endure serious harm.” (ECF No. 1 ¶ 1.) He alleges violations of forced labor and trafficking laws. The defendants move to dismiss the complaint pursuant to Federal Rule of Civil Procedure 12(b)(6). For the following reasons the motion is denied.^[1]

BACKGROUND

The following facts are drawn from the complaint and assumed to be true, with all reasonable interferences drawn in the plaintiff's favor. See Peretti v. Authentic Brands Group LLC, 33 F.4th 131, 137 (2d Cir. 2022).

I. The Odyssey Study Group

Sharon Gans Horn and her husband, Alex Horn, founded the Odyssey Study Group (“OSG”) in about 1980. (ECF No. 1 ¶¶ 12, 13.) Gans Horn was OSG's head “teacher” until her death in 2021. (Id. ¶ 16.) She led the organization with an “inner circle” of trusted “lieutenants,” including defendants Lorraine Imlay, Minerva Taylor, and Gregory Koch. (Id. ¶ 17.)

OSG “operated in secret” as an “esoteric school” that promoted the teachings of a “philosopher” named George Gurdjieff and one of his students, Peter Ouspensky, “purport[ing] to provide [OSG] ‘students' . . . tools to enrich the Students' lives, [and] to improve the Students' psychological well-being and to achieve overall success.” (Id. ¶¶ 12, 58.) OSG focused its student recruitment efforts on young professionals who were unhappy or dissatisfied with their lives and “searching for answers, meaning[,] and help.” (Id. ¶ 44.) OSG students paid tuition and attended semi-weekly classes and “numerous other activities and ‘retreats.'” (Id. ¶ 23.) Some of the charges included:

• $300 to $400 monthly tuition for class,

• $1200 tuition for annual retreat,

• $100 annual fee for Gans Horn's retirement fund,

• $10 weekly towards an “orphanage fund,”

• a $50 monthly maintenance fee for rent and other expenses of the facilities in which classes were held,

• $1,000 or more annually for “property taxes and upkeep on a ranch in Montana . . . of which Gans Horn was the beneficial owner and sole resident,”

• $200 or more annually for Christmas parties and birthday parties, • $200 annually for Christmas and birthday gifts for Gans Horn and the members of the inner circle, and

• $200 to attend “country retreats” at a “compound” in Pawling, New York.

(Id. ¶ 27.) OSG and its leadership derived millions of dollars in revenue from its students' financial contributions. (Id. ¶ 28.)

Students were also required to perform free labor for OSG's benefit-“to keep [the organization] functioning and maintained in all respects”-which OSG and its members called the “Third Line of Work.” (Id. ¶¶ 29-30.)

The defendants expected students to follow a rigid set of rules, including mandated secrecy, complete obedience to Gans Horn's and other teachers' instructions-which covered every aspect of the students' personal lives-and ostracizing anyone who left the organization. (See id. ¶¶ 31-41.) The students were also taught that sleep deprivation was beneficial, “that sleep was harmful to their ‘evolution,'” and that they “needed no more than a few hours of sleep at night.” (Id. ¶¶ 97-98.)

Gans Horn “encouraged adultery among students;” for example, she “directed one student, a married woman, to have sex with another student after Class.” (Id. ¶¶ 112-13.)

If a student broke a rule, “including by failing to adhere to one of Sharon Gans Horn's directives, Gans Horn disclosed personal and sensitive information” about that student to others. (Id. ¶ 111.) For example, after two students left OSG, Gans Horn “told the respective spouses of these two Students” that they had “cheated on their spouses.” (Id. ¶ 115.)

II. The Plaintiff's Time as a Student

The plaintiff was an OSG student for 23 years. (Id. ¶ 68.) Someone invited the plaintiff to join the group in 1989, when the plaintiff was a 29-year-old lawyer in New York City. (Id. ¶ 55.) He was mourning the loss of his father “who had died suddenly four years earlier and contending with a growing sense of loneliness that stemmed from . . . many of his friends mov[ing] away from New York City to start families while he was still single.” (Id. ¶ 56).

The plaintiff alleges that defendant Minerva Taylor greeted him at his first class and told him that she hoped OSG would be a “rich and wonderful experience” for him, “and then suggested to him that he might meet his ‘soulmate' at the School.” (Id. ¶ 60.) After that class, someone assigned to be the plaintiff's “sustainer” called the plaintiff and enticed him to remain in OSG. (Id. ¶¶ 63-64.)

A few weeks after he joined OSG, the plaintiff lost his law firm job and decided to start his own law firm as a solo practitioner. (Id. ¶ 66.) OSG's inner circle supported the decision and told the plaintiff that his success depended on his continued participation in OSG. (Id.) With OSG's encouragement and approval, another student (“Student #2”) became the plaintiff's primary client. (Id. ¶ 82.)

During his 23 years in OSG, the plaintiff attended class “twice a week, for several hours each night.” (Id. ¶ 130.) In 1990, “approximately one year after [the plaintiff] began to attend Classes, Sharon Gans Horn started to make appearances at Classes.” (Id. ¶ 67.) “At the first Class in which Gans Horn spoke, she discussed seven ‘levels of man' and stated that she was ‘very close' to the seventh level, which she described as being immortal and equated to ‘Christ, Mohammed, Moses and the Buddha,' and that she hoped to reach the seventh level soon.” (Id.) “In that same Class, Gans Horn told the Students that sex affected their ability to succeed and directed the Students to ‘use your sex' to promote the School and the Students' ‘evolution,' i.e., achievement of higher success in life.” (Id.)

During one class, Gans Horn directed students to reveal a childhood trauma. (Id. ¶ 114.) The plaintiff told Gans Horn and the other class members that a camp counselor sexually abused him when he was 14 years old. (Id.) Gans Horn told him that he “had been ‘experimenting' rather than abused.” (Id.) Following the plaintiff's revelation, Gans Horn frequently questioned the plaintiff's sexuality and implied that the abuse was his fault. (Id.)

The plaintiff was “so afraid that he would be publicly chastised if he missed even a single Class that he showed up no matter how sick he was.” (Id. ¶ 133.) “One time [the plaintiff] attended Class despite severe abdominal pain. When Class was over, [he] went directly to the emergency room, where he had immediate surgery to remove his gallbladder.” (Id.)

Gans Horn and her inner circle discouraged the plaintiff and other students from maintaining contact with their families, so the plaintiff “distanced himself” from his mother, brother, and old friends. (See id. ¶¶ 75-77, 123.) He developed close friendships with other OSG students. (See id.)

In the mid to late-1990s, Gans Horn and Taylor told the plaintiff not to propose to his girlfriend, who was not a student of OSG, so he did not. (Id. ¶ 123.) He dated and eventually got engaged to another OSG student, but “broke off the relationship after Gans Horn told him that she did not believe the relationship would work and directed him to end it.” (Id. ¶ 119.)

Shortly thereafter, the plaintiff started dating another student (“Student #1”). (Id.) The plaintiff married her “within a few months,” with Gans Horn's encouragement and approval. (Id.) “When Gans Horn learned that [the plaintiff] and Student #1 wanted to get pregnant, Gans Horn called [the plaintiff] and strongly suggested to [him] that Student #1 was too old to have a healthy child and instead told him to have a child with Student #1's 19-year-old daughter (i.e., [the plaintiff's] step-daughter).” (Id.) The plaintiff “rejected the idea and, fortunately, Gans Horn did not further pursue the matter.” (Id.) The plaintiff and Student #1 had a child together, but eventually decided to separate in 2010. (Id. ¶ 120.) Gans Horn told the plaintiff that he should let Student #1 have custody of their child. (Id.) The plaintiff did not follow her instruction and he and Student #1 share joint custody of the child. (Id.)

Consistent with OSG's doctrine, Gans Horn and the inner circle “induce[d]” the plaintiff to perform free labor they said it was necessary for his “evolution” in life and continued membership in the organization. (Id. ¶¶ 124-28.) The labor included recruiting other students, giving students career advice, setting up and cleaning up classrooms, planning and staffing OSG events, and maintaining and renovating the organization's facilities in New York and Montana. (Id. ¶¶ 124-28, 142-47, 154-57, 159-163.) The plaintiff also provided free labor to Gans Horn personally; he cooked meals for her, chauffeured her, and took care of her husband after he contracted lung cancer. (Id. at ¶¶ 124-28, 138-141, 149-152.) According to the complaint,

[the plaintiff] performed such labor and services because he feared that if he did not, the Organization and the Inner Circle would (a) publicly reprimand him, leaving him humiliated; (b) tell him to he could

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