This was easy.
If an errored element has a parent called .custom-select, then insert after the custom select wrapper. Otherwise, proceed as usual.
$form.validate
errorPlacement: (error, element) ->
inserted = false
if <a href="http://element.is">element.is</a>('select')
customSelect = element.closest('.custom-select')
if customSelect.length > 0
error.insertAfter(customSelect)
inserted = true
if not inserted
error.insertAfter(element)