Fried chicken fast-food chain Bojangles and one of its largest franchisees are not entitled to defense coverage in an underlying civil suit alleging a restaurant manager sexually groomed and abused two minor employees in North Carolina, their insurance company said Friday.

Pennsylvania Manufacturers' Association Insurance Co. alleged in a North Carolina federal complaint that a commercial general liability policy and five workers' compensation and employers' liability policies belonging to Bojangles or its franchisee BOJ of WNC LLC do not cover the claims. The underlying suit alleges Bojangles, BOJ of WNC and unit director Michael Godey "turned a blind eye" to the abuse by the former manager, who has since been indicted on criminal sexual exploitation charges.

The insurance company argued not all the defendants are insured under the policies, which also exclude coverage for bodily injuries like those alleged in the underlying litigation. Some of the policies additionally did not take effect until after the case was filed, the insurer said.

According to the complaint, BOJ of WNC, Godey and Bojangles Opco LLC, which does business as Bojangles, were sued in Haywood County Superior Court in June by a guardian of two underage girls, identified in the suit only as Jane Doe 1 and Jane Doe 2.

The underlying suit alleges the girls worked at a Bojangles restaurant in Waynesville, North Carolina, owned by BOJ of WNC, which according to its website operates over 100 Bojangles locations across the Southeast. That suit claims the girls' manager, Dylan Sain, "openly and brazenly used his position of authority over [them] to repeatedly sexually abuse and exploit them."

The underlying suit claims that included threats and intimidation to force the girls to perform sexual acts on him and "coercive and grooming behavior," such as showing the girls preferential treatment and letting them take longer breaks.

Godey is accused of failing to act and dismissing other employees' concerns when they reported the abuse. Per the insurance company's lawsuit, the girls' guardian said Bojangles failed to protect them "from Sain's abhorrent pedophilic behavior." At least five other girls may also have been sexually abused by Sain, the underlying lawsuit claims.

Sain was indicted by a grand jury in May on charges of dissemination to a minor under the age of 16, taking indecent liberties with a child, third-degree sexual exploitation of a minor and statutory sexual offense with a person 15 years of age or younger, Pennsylvania Manufacturers' Association Insurance Co. said.

The guardian's civil suit accuses Bojangles, BOJ of WNC and Godey of failing to adequately supervise Sain, failing to train employees about reporting sexual abuse and failing to intervene when they knew about the abuse.

But the insurer said Bojangles' general liability policy insured only Bojangles' Restaurants Inc. and its subsidiaries, which do not include BOJ of WNC, or Godey, as an employee.

According to the complaint, the policies define a subsidiary as an entity in which Bojangles owns more than 50% of the business. Bojangles does not own a controlling share of BOJ of WNC, thereby excluding it from coverage, the insurance company said.

Godey is also not covered because the general liability policy excludes coverage for bodily injury to a coworker in the course of their employment, the insurer said. Per the suit, Godey allegedly allowing the sexual abuse to continue fits into that exclusion.

Pennsylvania Manufacturers' Association Insurance Co. additionally argued the exclusions apply to bodily injuries occurring in the course of the underlying plaintiffs' employment and bodily injuries that arise from "employment-related practices," including "coercion," meaning Bojangles would likewise not be entitled to coverage.

The workers' comp policies, meanwhile, list only BOJ of WNC as the named insured and do not apply to Bojangles or Godey, according to the insurer. Coverage under those policies also did not kick in until September, it said, and the underlying complaint was filed in June.

The insurance company is seeking a declaration that it is not required to defend or indemnify any of the defendants in the underlying lawsuit under the relevant policies.

Counsel for Pennsylvania Manufacturers' Association Insurance Co. and a Bojangles spokesperson did not immediately respond to requests for comment Friday.

Pennsylvania Manufacturers' Association Insurance Co. is represented by Andrew J. Santaniello of Pope Aylward Sweeney & Santaniello LLP and Brian C. Bassett of Traub Lieberman Straus & Shrewsberry LLP.

Counsel information for the defendants was not immediately available.

The case is Pennsylvania Manufacturers' Association Insurance Co. v. BOJ of WNC LLC et al., case number 1:25-cv-00395, in the U.S. District Court for the Western District of North Carolina.