Commonwealth v. Wiggins (and 28 companion cases) (Lawyers Weekly No. 10-146-17)

NOTICE:  All slip opinions and orders are subject to formal revision and are superseded by the advance sheets and bound volumes of the Official Reports.  If you find a typographical error or other formal error, please notify the Reporter of Decisions, Supreme Judicial Court, John Adams Courthouse, 1 Pemberton Square, Suite 2500, Boston, MA, 02108-1750; (617) 557-1030; SJCReporter@sjc.state.ma.us

SJC-10975

COMMONWEALTH  vs.  MAXWELL WIGGINS, JR.
(and twenty-eight companion cases[1]).

Hampden.     February 10, 2017. – September 6, 2017.

Present:  Gants, C.J., Hines, Lowy, & Budd, JJ.[2]

Homicide.  Home Invasion.  Robbery.  Evidence, Identification, Cross-examination by codefendant’s counsel, Relevancy and materiality, Photograph.  Identification.  Deoxyribonucleic Acid.  Practice, Criminal, Capital case, Identification of defendant in courtroom, Severance, Mistrial, Argument by prosecutor, Sentence.  Constitutional Law, Sentence. read more

Posted by Stephen Sandberg - September 6, 2017 at 2:52 pm

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German v. Rubin, et al. (Lawyers Weekly No. 12-117-17)

David Lopes Ca 1 rdozo and President & Fellows of Harvard College
COMMONWEALTH OF MASSACHUSETTS
MIDDLESEX, ss. SUPERIOR COURT
CIVIL ACTION
NO. 16-01640
GUSTAVO GERMAN
vs.
LEE L. RUBIN & others1
MEMORANDUM OF DECISION AND ORDER ON PRESIDENT & FELLOWS OF
HARVARD COLLEGE’S MOTION FOR RECONSIDERATION OF ITS REQUEST
FOR A STAY PENDING APPEAL
INTRODUCTION
On May 31, 2017, this court issued an order allowing the pro se plaintiff, Gustavo German’s
(“German”), motion to add President & Fellows of Harvard College (“Harvard”) as a party and
directing Harvard to comply with this court’s December 5, 2016 order.
On June 19, 2017, this court issued an amended Revised Order directing Harvard to provide
German with “full access” to “the Bauer Building (located in the basement of the Sherman-Fairchild
Building where the Rubin Lab is located)” and to “the BRI facility inside the Bio Lab Building”
where German houses and conducts research with a specialized mouse colony. Counsel for Harvard
sought a stay of the court’s orders pending appeal in open court, which was denied. This court stated
that it would reconsider its ruling if Harvard submitted evidence concerning the laws and regulations
governing animal research at Harvard. Harvard filed a notice of appeal on June 21, 2017, seeking
appellate review of this court’s May 31, 2017 order and its June 19, 2017 Revised Amended Order.
2
Before this court is Harvard’s Motion for Reconsideration of its Request for a Stay of both
orders pending appeal (“Motion”). After hearing and careful review of the submissions of the
parties, the Motion is ALLOWED in part and DENIED in part.
Before this court is Harvard’s Motion for Reconsideration of its Request for a Stay of both
orders pending appeal (“Motion”). After hearing and careful review of the submissions of the
parties, the Motion is ALLOWED in part and DENIED in part.
BACKGROUND
On June 20, 2017, following this court’s invitation to submit additional evidence, Harvard
submitted the affidavit of Steven Niemi, which addressed various federal and local regulations
governing animal research at Harvard. The affidavit also explained that because German has been
withdrawn as a graduate student at Harvard, he is no longer eligible to use or access any regulated
animals located in any Harvard facility for any purpose.
On June 29, 2017, this court conducted an evidentiary hearing where Harvard offered the
testimony of Dr. Ara Tahmassian, its Chief Research Compliance Officer, concerning the role of
Harvard’s Institutional Animal Care and Use Committee (“IACUC”), which revoked German’s
access to the BRI facility. Dr. Tahmassian guided this court through the federal regulations that
establish the IACUC as an oversight body that is independent of Harvard. He explained that under
those regulations Harvard cannot overrule the IACUC in the event of a negative decision concerning
animal testing and research, including its decision to revoke German’s access because he is no longer
a person “affiliated” with the university. Dr. Tahmassian explained that the IACUC undertook
review, and ultimate revocation, of German’s access to the animal testing facilities based upon
German’s “change of status,” which was communicated to the IACUC by Harvard’s Office of
3
General Counsel following its withdrawal of German from the university. Dr. Tahmassian also
explained that German is now prohibited by the applicable regulations from accessing any regulated
animals at Harvard facilities because he is no longer affiliated with the university. He further
testified that the only way for German to regain access is if his affiliation with the university is
restored, either through readmission as a student or through qualifying employment with the
university. This court credits Dr. Tahmassian’s testimony and explanation of the applicable federal
and local laws and regulations.
DISCUSSION
“An appellant seeking a stay pending appeal must ordinarily meet four tests: (1) the
likelihood of appellant’s success on the merits; (2) the likelihood of irreparable harm to appellant
if the court denies the stay; (3) the absence of substantial harm to other parties if the stay issues; and
(4) the absence of harm to the public interest from granting the stay.” C.E. v. J.E., 472 Mass. 1016,
1017 (2015), quoting J.W. Smith & H.B. Zobel, Rules Practice § 62.3, at 409 (2d ed. 2007).
Upon consideration of the additional evidence Harvard provided, and in particular the
testimony of Dr. Tahmassian, this court finds that even though the revocation of German’s access
to the BRI facility is a direct result of Harvard’s questionable withdrawal of him as a student, there
would be irreparable harm to Harvard if this court enforced its June 19, 2017 order against it as
concerns access to the BRI facility. To comply, Harvard would be forced to violate federal and local
laws governing animal testing thereby subjecting Harvard to the severe consequences provided by
those same laws. The court finds that substantial harm will unfortunately be visited upon German
by granting this limited stay because he will be unable to conduct his research while he remains
“unaffiliated” with the university. However, the repercussions of forcing Harvard to violate federal
4
and local animal testing laws outweigh the harm to German, which this court expects will be
temporary.
ORDER
It is, therefore, ORDERED that the Motion for Reconsideration is ALLOWED in part. The
Court’s June 19, 2017 order, as it concerns German’s access to the BRI facility, is stayed pending
appeal, or until such time as German’s status as a researcher “affiliated” with Harvard is restored,
whichever is shorter. As to all other relief requested, the Motion is DENIED.
_________________________
Elizabeth Fahey
Justice of the Superior Court
DATED: July ____, 2017 read more

Posted by Stephen Sandberg - September 6, 2017 at 4:08 am

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German v. Rubin, et al. (Lawyers Weekly No. 12-118-17)

COMMONWEALTH OF MASSACHUSETTS
MIDDLESEX, ss. SUPERIOR COURT
CIVIL ACTION
NO. 16-01640
GUSTAVO GERMAN
vs.
LEE L. RUBIN & others1
MEMORANDUM OF DECISION AND ORDER ON PLAINTIFF’S EMERGENCY
MOTION FOR AN ORDER DISALLOWING ADMINISTRATIVE PROCEEDINGS
INTRODUCTION
The pro se plaintiff, Gustavo German (“German”), obtained a harassment prevention order,
pursuant to G.L. c. 258E, on August 25, 2016. The most recent revision of that order was issued on
December 5, 2016. See Paper No. 78.
Before this court is German’s Emergency Motion for an Order Disallowing Lee L. Rubin
and/or Any Employee at Harvard Corporation to Initiate Administrative Proceedings Against
Plaintiff without Leave of Court (“Motion”). For the reasons below, the Motion is ALLOWED
nunc pro tunc to May 4, 2017.
PROCEDURAL BACKGROUND
The Motion was filed on an emergency basis on May 4, 2017, after German was put on notice
that administrative proceedings were underway, which could lead to his ultimate removal from
Harvard as a Ph.D. candidate. President & Fellows of Harvard College (“Harvard”) and Lee L.
Rubin (“Rubin”) filed a response and opposition to the Motion on May 11, 2017. Harvard filed a
written request for hearing, but did not call the court to obtain a hearing on an expedited basis. A
flurry of additional motions and oppositions were filed in the two weeks following May 10, 2017 read more

Posted by Stephen Sandberg - September 6, 2017 at 12:33 am

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German v. Rubin, et al. (Lawyers Weekly No. 12-119-17)

David Lopes Ca 1 rdozo and President & Fellows of Harvard College
COMMONWEALTH OF MASSACHUSETTS
MIDDLESEX, ss. SUPERIOR COURT
CIVIL ACTION
NO. 16-01640
GUSTAVO GERMAN
vs.
LEE L. RUBIN & others1
MEMORANDUM OF DECISION AND ORDER ON DEFENDANTS RUBIN AND
PRESIDENT & FELLOWS OF HARVARD COLLEGE’S MOTIONS TO DISMISS
INTRODUCTION
Pursuant to Mass. R. Civ. P. 65.3, the pro se plaintiff, Gustavo German (“German”) then
a fifth-year doctoral candidate at Harvard, filed a Verified Complaint for Civil Contempt
(“Complaint”) on June 14, 2017. German previously obtained a harassment prevention order
issued pursuant to G.L. c. 258E against Dr. Lee L. Rubin (“Rubin”) on August 25, 2016, in
which this court directed that German be fully restored to the position he occupied in Rubin’s lab
(“the Rubin Lab”) as of March 10, 2016, before the harassment began. That order was amended
on September 9, October 4 and14, and December 5, 2016, after repeated requests by defendants
Rubin and President & Fellows of Harvard College (“Harvard,” together with Rubin, “the
defendants” ).
German’s Complaint alleges, generally, that the defendants violated several directives
contained in the most recent Revised Order dated December 5, 2016 (“Order”), and as a result (1)
The harassment included, among other things, that German was forcibly seized 2 and hospitalized for a mental health
evaluation on June 4, 2016, based upon fabricated concerns about German’s mental health that Rubin provided to
Dr. Ayse A. Atasoylu, a physician from Harvard University Health Services.
2
German has not yet been restored to the position he was in prior to the harassment, (2) he has
been prevented from completing his research and thesis, and (3) he has now been forcibly
withdrawn as a student.
Before the court are Rubin’s and Harvard’s separate motions to dismiss the Complaint.
After hearing and careful review of the parties’ submissions, both motions are ALLOWED in
part and DENIED in part.
PROCEDURAL HISTORY
On August 25, 2016, German obtained a harassment prevention2 order against Rubin
following German’s report of Rubin’s research misconduct, i.e., his knowing publication of
fabricated data. Rubin is a tenured professor at Harvard and the primary investigator (“P.I.”) of
the Rubin Lab, the facility in which German works while pursuing his Ph.D. The resulting
August 25, 2016 harassment prevention order consisted of two directives. First, Rubin was to
stay at least 100 feet away from German and have no contact, direct or indirect, with him.
Second, German was “to immediately be fully restored to his position and research in the Rubin
Lab with all the assistance, equipment, and supplies he had on March 10, 2016.” See Paper No.
19, p. 27.
Both Rubin and Harvard filed motions seeking to vacate or modify the Order citing the
impracticalities of implementation in both the academic and lab environments. See Paper Nos.
22, 31, 47, 51, 55, 62, 63, and 114. These motions led to several hearings before this court in the
fall of 2016 and an interlocutory appeal, which resulted in some modification of the original
See Paper No. 33 (“During the hearing on September 6, 2016, this c 3 ourt learned that plaintiff has not yet been fully
restored to his position as of [sic] March 2016. Should that still be the case by September 16, 2016, the plaintiff may
request a further hearing . . . at which [Rubin] and Harvard will submit a pleading/affidavit as to what efforts have
been made to fully restore plaintiff to the position he was in in March 2016 and why that has not yet occurred.”);
Paper No. 50 (“Until plaintiff has completed his research to his satisfaction, including a thesis he is willing to submit
for publication, plaintiff is not to be transferred from the [lab] without plaintiff’s consent or court order.”); Id.
(“Harvard agrees that it will work with German and do everything it can to be sure that he promptly has the
necessary equipment for his research.”); Paper No. 58 (Prior court orders were “issued to restore Plaintiff to a lab at
Harvard where he had been banned by Harvard since June 6, 2016, so he may complete his research and achieve his
Ph.D.”).
3
August 25, 2016 Order. As the court stated in its October 17, 2016 Memorandum and Order, it
“made substantial efforts to fashion an order that appropriately satisfied Defendant Rubin for the
harm he caused Plaintiff and to restore Plaintiff as much as possible to the position he was in at
the Rubin Lab. . . .” See Paper No. 58, p. 1. Throughout the parties’ interactions with this court,
this court’s oft repeated goal remained clear and unchanged: to return German to the status quo
he enjoyed as of March 10, 2016, and allow him to complete his research, thesis, and his Ph.D.3
The last Revised Order was issued on December 5, 2016, and states “[p]laintiff be
immediately and fully restored to and remain in his position in the Rubin Lab, with all the
assistance, equipment, and supplies he had on March 10, 2016” and that “Mr. German shall
remain working in the Rubin Lab, supervised by the [sic] Dr. Rubin, though all physical meetings
shall include a third party. . . .” It states, further “[w]ithin 48 hours, defendant Rubin is to release
to Harvard . . . whatever funds are necessary to provide plaintiff with the same resources he had
on March 10, 2016, i.e., two . . . research assistants he had been approved for and then had, and
the S.M.A. mice . . . necessary for his research.” It also directs that “[p]laintiff’s key card access
to the Rubin Lab is not to be disturbed or withdrawn and is to remain in full force and effect.”
The Order also provides guidelines for the limited meetings between Rubin and German
4
that the parties previously explained were necessary. The Order states “all physical meetings
shall include a third party, which shall be one of those listed by German, all of whom Harvard
accepts and [Rubin] does not oppose. As no meeting between German and Rubin occurred
between 10/14/16-11/30/16, their meetings are not to occur more than every six weeks, absent
any emergency or good cause. Besides this physical contact in the presence of a third party, all
other contact between German and Rubin shall be by email, text messages or Lab meetings as
described above.”
BACKGROUND
When deciding a motion to dismiss pursuant to Mass. R. Civ. P. 12(b)(6), the court
reviews the motion in accordance with the principles articulated in Iannacchino v. Ford Motor
Co., 451 Mass. 623, 636 (2008). As such, the court accepts the allegations of the Complaint as
true. Spinner v. Nutt, 417 Mass. 549, 550 (1985). German’s Complaint alleges that Harvard and
Rubin have violated the terms of the Order, as follows.
I. Harvard’s Alleged Conduct
German alleges that Harvard took actions to contravene the Order’s directive that German
be “immediately” and “fully restored to and remain in his position and research in the Rubin lab .
. . ,” by (1) revoking his key card access to certain research facilities; (2) instituting
administrative proceedings against German for failing to attend his Dissertation Advisory
Committee (“DAC”) meeting; and (3) withdrawing him as a graduate student at Harvard based
upon the same refusal to attend the DAC meeting without leave of court. Compl., at pars. 42, 55,
62.
Concerning his academic suspension and withdrawal from the Ph.D. program, German
5
alleges the following. On March 2, 2017, German’s program advisors requested that German
hold a DAC meeting. Id. at par. 16. On March 3, 2017, German agreed to attend the DAC
meeting scheduled for March 30, 2017, on the condition that Sheila Thomas, whom Harvard had
designated as German’s interim thesis advisor even though her field appears very different from
German’s, not attend as German believed the Order required Rubin to be his thesis advisor. Id.
at par. 17. On March 6, 2017, the program administrators informed German “as a condition for
the DAC meeting that German accept to have a new thesis advisor in Rubin’s stead.” Id. at par.
18. German rejected the condition and refused to attend the DAC meeting, stating it would
violate the Order that he was to be “supervised by Dr. Rubin.” Id. at par. 19. On March 10,
2017, German emailed his DAC, the program advisors, and Rubin (through counsel), objecting
to the requirement that Rubin be replaced as his thesis advisor and expressing his concern that it
violated the court’s Order. Id. at par. 20. German further alleges that he was concerned that
replacing his thesis advisor may have altered the already approved schedule for completing his
research. Even if the new thesis advisor were not acting in bad faith, “he or she may have a
different scientific understanding (or misunderstanding) than the one German agreed [to] with
Rubin and his DAC.” Id. at pars. 25-27.
In response, the defendants both denied that the court ordered Rubin to be German’s
thesis advisor. Id. at par. 31. German alleges he was then threatened with administrative
proceedings by Dean Garth McCavana if he would not agree to hold the DAC and replace his
thesis advisor. Id. at par. 32. On March 30, 2017, German again emailed his program advisors
and Dean McCavana stating his objection to holding the DAC meeting “to assign German a new
thesis advisor” and his belief that doing so would violate the Order. Id. at pars. 31-32.
German also alleges that beginning on June 1, 2017, Harvard po 4 sted security guards at the Rubin Lab and that
German was intimidated by the “extraordinary presence” of a security guard, who “turned his body to face German
straight while staring at him until German looked away.” Id. at pars. 50-51. As German does not allege how the
presence of these guards violated the Order, or impaired his ability to do his research, he has not alleged sufficient
facts to claim civil contempt for Harvard’s use of security guards. However, such conduct appears very different
than the “status quo” of March 10, 2016, to which this court has made frequent reference.
6
On April 6, 2017, Harvard, through Dean McCavana, initiated administrative proceedings
against German and threatened him with academic probation. Id. at par. 34. On April 25, 2017,
Harvard placed German on academic probation. Id. at par. 35.
On May 4, 2017, German filed an Emergency Motion for an Order Disallowing Lee L.
Rubin and/or Any Employee at Harvard Corporation to Initiate Administrative Proceedings
Against Plaintiff Unless Prior Leave is Granted by the Court. Id. at Par. 37. See Paper No. 105.
On May 10, 2017, Harvard filed a written request for hearing with this court, requesting a hearing
“at the earliest practicable time.” See Paper No. 107.2. German alleges that Harvard’s counsel
intentionally did not call the clerk’s office, as is customary, to schedule a hearing on an
emergency basis. Compl. at pars. 39-41. No hearing was held on German’s emergency motion
until May 31, 2017.
On May 16, 2017, without waiting for the court to schedule a hearing on German’s
emergency motion, Harvard withdrew German from his graduate program and disaffiliated him
from the university. Id. at par. 42. Once Harvard withdrew German from the program, it notified
the Department of Homeland Security of German’s disaffiliation, as German’s legal presence in
the United States is solely based on his student visa, which was rendered inoperable by
Harvard’s having withdrawn him. Although Harvard has invited German to reapply, Harvard
and its faculty have told German that he is no longer a student at Harvard and have denied him
access to the facilities he needs for his research, his mouse colony, and the animal testing facility.
Id. at pars. 58, 59, 64, 68, 69, and 73.4
The parties have used the terms “thesis advisor,” “academic ad 5 visor,” and “dissertation supervisor” at various
times in submissions and in court. This court treats these terms as interchangeable. This court is cognizant of the
argument Rubin makes in his Motion to Dismiss distinguishing between his role “as the Primary Investigator at his
lab” and his role as German’s “thesis advisor.”
6 To the best of this court’s knowledge, at no time prior to December 5, 2016 was any mention made of the BRI or
the Bauer Lab that German needs and had used to complete his research. It is undisputed that until Harvard
“withdrew” plaintiff, he had access to Bauer, BRI and the Rubin Lab. Pursuant to this court’s Order dated June 19,
2017, Harvard has restored German’s access to the Bauer Lab in the Sherman-Fairfield building, in which the Rubin
Lab is also located.
7
II. Rubin’s Alleged Conduct
German alleges that Rubin has failed to fully restore him to his position at the Rubin Lab
or supervise his work, and as a result, he has been unable to continue and complete his research.
Specifically, Rubin has held lab meetings without including German, as contemplated in the
Order. Id. at par. 79. Rubin refuses to supervise German, act as German’s “thesis advisor,”5 and
attend his DAC meetings. Id. at par. 78. Finally, Rubin has not released any of the funds he was
ordered to release to Harvard “to provide plaintiff with the same resources he had on March 10,
2016.” Id. at par. 77.
III. Allegations against the Defendants Concerning Key Card Access
German also alleges that Rubin has ignored German’s requests to recover key card access
and assistance, thus denying him access to the facilities he uses for his research.6 Id. at par. 76.
Since June 1, 2017, German has been denied access to the Biology Research Infrastructure
(“BRI”) facility at Harvard where he performs research on a highly specialized mouse colony.
German has provided video of his key card being refused at that site. Since June 2, 2017,
German has also been denied access to Rooms B03 and B07, which he states are “in the Rubin
Lab,” where he performs his research work. German has provided video of his key card being
refused at those rooms. German further alleges that Rubin, as the head of his lab, “is the person
Following a show cause hearing on June 19, 2017, this 7 court ordered that German’s access be restored to the
Sherman-Fairfield Building where the Rubin Lab is located, including the basement rooms B03 and B07, and the
BRI (animal testing) facility so that he could continue his research despite his forced withdrawal from Harvard.
Harvard’s counsel reported in open court on June 26, 2017 that his access was restored, with the exception of the
BRI facility, which is governed by an independent regulatory body over which Harvard has limited control. The
issues surrounding access to the BRI facility are the subject of a pending Motion for Reconsideration by Harvard and
are addressed in a separate decision.
8
who has the right and sole discretion, by custom, to authorize anyone to receive key card access
to the lab. …” Id. at para. 76.7
IV. Allegations against the Defendants Concerning Failure to Provide
Research Assistants
The Order provides that German was to be provided funding for the resources he had as
of March 10, 2016, including “two (part-time 15-20 hours each) research assistants he had been
approved for. …” German alleges he has not been provided any research assistants over the ten
months since the initial Order issued. German alleges that Rubin could comply with the Order
by assigning time from the research assistants currently employed in his lab. Id. at par. 76.
DISCUSSION
I. Standard of Review
The purpose of Mass. Rule Civ. P.12(b)(6) is to permit prompt resolution of a case where
the allegations in the complaint clearly demonstrate that the plaintiff’s claim is legally
insufficient. The Harvard Crimson, Inc. v. President & Fellows of Harvard College, 445 Mass.
745, 748 (2006). Such a motion calls upon the court to determine whether the factual
allegations of the complaint, taken as true, as well as all reasonable inferences drawn therefrom
in favor of the claimant, are sufficient to warrant relief. See Marram v. Kobrick Offshore Fund
Ltd., 442 Mass. 43, 45 (2004); Spinner, 417 Mass. at 550. Conclusory allegations without
factual support are to be disregarded. See Quincy City Hosp. v. Labor Relations Comm’n, 400
Mass. 745, 750 (1987); Daddarie v. Cape Cod Comm’n, 56 Mass. App. Ct. 764, 773-774 (2002).
9
A complaint need not, however, cite evidence in support of factual allegations; it need only give
notice of the facts on which the claim is based. See Conley v. Gibson, 355 U.S. 41, 46-48
(1957); The Harvard Crimson, Inc., 445 Mass. at 748-749.
“To hold a party in contempt, ‘there must be a clear and unequivocal command and an
equally clear and undoubted disobedience.’” Newell v. Department of Mental Retardation, 446
Mass. 286, 305 (2006), quoting Nickerson v. Dowd, 342 Mass. 462, 464 (1961). The order
should be “sufficiently clear, so that the party to be bound is provided with adequate notice of the
required or prohibited activity.” Mohamad v. Kavlakian, 69 Mass. App. Ct. 261, 263 (2007),
quoting Demoulas v. Demoulas Super Mkts., Inc., 424 Mass. 501, 566 (1997). “Where the order
is ambiguous or the disobedience is doubtful, there cannot be a finding of contempt.” Judge
Rotenburg Educ. Ctr. v. Commissioner of Dept. of Mental Retardation, 424 Mass. 430, 443
(1997).
German’s Complaint contains several alleged violations of the Order by each party. This
court addresses each alleged violation seriatim.
II. Analysis
a. Rubin’s Failure to “Supervise”
German asserts that Rubin has violated the Order by refusing to “supervise” him,
including his refusal to fulfill his role as German’s thesis advisor. The Order contains two
provisions related to this allegation. First, it states that “[p]laintiff is to immediately be fully
restored to and remain in his position and research in the Rubin Lab with all the assistance,
equipment, and supplies he had on March 10, 2016.” Second, it states that “German shall remain
working in the Rubin Lab, supervised by the [sic] Dr. Rubin. …” See Paper No. 19, p. 27.
10
Rubin argues that he is in full compliance with the court’s Order. Rubin does not dispute
that he has not supervised German nor served as his thesis advisor since the date of the Order,
but claims the language of the Order absolves him of any such advisory role, or is at best
ambiguous. See Paper No. 134.1, pp. 4-5.
It is not contested that prior to March 10, 2016, German was “supervised” by Rubin as a
graduate student in the Rubin Lab. As Rubin has previously stated to this court, “[n]ormally, the
[P.I.] of the lab in which a graduate student is pursuing research also serves as the student’s
dissertation advisor, directing the student’s research and helping to determine when the student is
ready to prepare and defend his or her dissertation.” Fourth Aff. of Lee L. Rubin, Paper No. 126,
at par. 7. In his first Affidavit, filed July 6, 2016, at paragraph 6 Rubin, under oath, stated: “I
am the thesis advisor of each graduate student working in my lab. This means I must mentor the
students and approve each thesis.” In paragraph 7, Rubin stated: “As PI, I am responsible for
approving, directing and supervising all of the work performed by members of the lab, . . .” Dr.
William Lensch, Executive Director of the Harvard Stem Cell and Regenerative Biology
(“HSCRB”) stated on September 5, 2016, under the pains and penalties of perjury: “Under the
federal rules and regulations governing the federal grants provided to the Rubin Lab, Dr. Rubin,
as Principal Investigator, is personally responsible for supervising and directing all of the
research conducted under those grants . . . . everyone performing research at the Rubin Lab
reports (and is required to report) directly to Dr. Rubin.” There is no dispute that, prior to the
harassment, Rubin was the P.I. of the lab and German’s supervisor and dissertation advisor.
Despite arguments and proposals in the fall of 2016 by Harvard and Rubin seeking to have
German’s research moved to another lab under another supervisor, that did not work out.
In his motion, Rubin cites to statements made by this court during hearings 8 in May 2017. These transcript
excerpts do not have any effect on what the Order clearly states. Furthermore, at the time of the hearing, this court
did not have the benefit of recently reviewing the past submissions of the parties, as it has now had the chance to do.
11
Harvard then suggested on October 11, 2016, as a way to keep the Rubin lab open and
functioning for both Rubin and German, that Rubin “supervise” German at the Rubin Lab.
German and this court initially were hesitant but later agreed. This court in its December 5, 2016
Order, clearly stated that German was to be “supervised by [sic] Dr. Rubin” without further
qualification, and to have all of the “assistance” with his “research” that was in place prior to
March 10, 2016. No one then or later ever questioned the court of the meaning of “supervise,”
which language Harvard had specifically requested.
The Order makes no distinction between different categories of supervision, as Rubin
argues. It makes a clear statement concerning German being restored to the same place “in his
position and research” he was in as of March 10, 2016. That would necessarily include Rubin’s
required supervision of that research. The Order is also clear that German is to be “supervised by
Dr. Rubin.” Rubin’s arguments that the Order, as written, obviates his prior role as German’s
supervisor and thesis advisor strains the limits of credulity.8 Rubin now claims that he was only
required to “supervise the lab,” which this court never mentioned.
As the Order is clear as to Rubin’s supervision of German and his research, German’s
allegations that Rubin has failed to supervise German, refused to participate as his thesis advisor,
or even communicate with German since the Order, are sufficient to survive a Rule 12(b)(6)
challenge.
b. Rubin’s Failure to “Release Funds”
German alleges that Rubin has not released any of the funds he was ordered to release to
12
Harvard “to provide plaintiff with the same resources he had on March 10, 2016.” Rubin argues
that it is undisputed that Harvard has made the financial resources available to German, negating
his obligation to provide “necessary” funds. Rubin also argues that this issue was previously
decided on a prior motion to dismiss an earlier contempt complaint in favor of Rubin.
This court finds that the issue has been previously decided and, in any event, Harvard has
made clear its provision of funds for German’s research assistants and research supplies (mice).
As such, German’s Complaint fails to state a claim for Rubin’s failure to “release funds.”
c. Rubin’s Failure to Invite German to Lab Meetings
The Order was revised to permit Rubin to have contact with German at “Lab meetings.”
Rubin’s opposition does not specifically address the allegations concerning “lab meetings.” But,
in his Fourth Affidavit at paragraph 18, Rubin admits that prior to German being restored to the
Rubin Lab on August 25, 2016, Rubin “conducted periodic general lab meetings, during which
all members of the Rubin Lab would meet to discuss their research with one another and with
me.” He states in paragraph 20 that since German was restored, he has not held any such
meetings but has instead met either individually or “conducted project meetings. . . .” German
alleges that Rubin has “mislabeled” the meetings he now holds with lab students and no longer
holds meetings for all graduate students working in the Rubin Lab. While this court thinks it is
highly unlikely that Rubin has successfully operated his lab without any general lab meetings
with his supervised graduate students and employees for the past seven months, the Order does
not compel that such meetings be held. Further, German has not alleged facts that by not holding
general lab meetings, Rubin has impacted German’s research or his position in the Rubin Lab.
For these reasons, the Complaint does not support a claim for contempt for failure to hold “lab
That Harvard required a second Order to effect the second lab access 9 that German had on March 10, 2016 can be
a factor in determining any punishment appropriate as to Harvard during the contempt trial.
13
meetings.”
d. German’s Denial of Access to Research Facilities
German alleges that beginning on June 1, 2017, he was denied access to two rooms that
he had previously used for his research at the Rubin Lab. German also alleges he has been
denied access to the BRI animal testing facility where his mouse colony is kept. Rubin argues
that he has no control over the granting or removal of key card access to Harvard facilities.
Harvard argues that German’s denial of access to certain Harvard facilities was a natural
consequence of his withdrawal from the university, and that it has no authority to restore his
access to the BRI facility.
It is uncontested that German’s access to the two rooms, B03 and B07, has been restored
pursuant to this court’s June 19, 2017 Order. As a claim of civil contempt is “a remedy to
compel compliance with a court order,” Karellas v. Karellas, 54 Mass. App. Ct. 469, 473 (2002),
and compliance, at least as to those two rooms, has been achieved, there is no longer any factual
basis that can support a claim for contempt on those grounds.9
German remains unable to access the BRI where his mouse colony is kept, leaving him
effectively stymied in his research. Harvard and Rubin each contend that Rubin has no control
over key card access to Harvard facilities. German alleges that it is the P.I. of each lab who
customarily controls who has access to lab facilities, and has supported this allegation with an
affidavit. If true, Rubin may have had some affirmative obligation to use his authority to make
sure German’s access remained undisturbed, as the Order dictates. This court need not resolve
This court conducted an evidentiary hearing on June 29, 2017, 10 where Harvard offered the testimony of Dr. Ara
Tahmassian, its Chief Research Compliance Officer, concerning the role of the IACUC. This court credits Dr.
Tahmassian’s testimony, but finds it only tangentially relevant to the issues presented in Harvard’s motion to dismiss.
Incredibly, one of Harvard’s attorneys in its General Counsel’s office advised the court at this hearing that, knowing
of this court’s December 5, 2016 Order, she sent notice to IACUC of Harvard’s withdrawal of German. This court
accepts that, when she did so, she knew that it would cause German to lose access to the BRI facility.
14
what is a clear disputed issue of fact concerning the role of a P.I. in granting or revoking access
to lab facilities in deciding a Rule 12 motion. This court finds that German’s allegation that
Rubin ignored his requests to restore access to all facilities used in his research may constitute a
basis for contempt.
Harvard argues that it has limited control over access to the BRI facility. Federal law
requires that the Institutional Animal Care and Use Committee (“IACUC”) ensure Harvard’s
compliance with federal and local laws concerning animal testing.10
Notwithstanding the role of the IACUC, it is clear that the only reason German is being
refused access to the BRI facility is because of Harvard’s withdrawal of him as a graduate student
for refusing to accept a different thesis advisor, one whose qualifications and competence to
advise German remain unclear to this court. As explained to this court at the June 29, 2017
evidentiary hearing, only affiliated individuals (e.g., students, employees, visiting scholars) are
permitted access to animal testing facilities under federal law. German’s allegations support the
reasonable inference that it was solely the withdrawal action of Harvard, which changed his
status from “affiliated” to “unaffiliated,” that caused the IACUC to revoke German’s access.
The Order makes clear that German “is to immediately be fully restored to and remain in
his position and research in the Rubin Lab with all of the assistance, equipment, and supplies”
he previously had. Harvard’s disaffiliation of German from the university has denied him the
ability to continue his research, and removed German from the equipment and assistance to
which he previously had access. This court finds that such facts are sufficient to state a claim for
15
contempt.
e. Harvard’s Administrative Proceedings and Withdrawal of German
German contends that Harvard violated the Order by instituting administrative
proceedings against German for failure to attend his Dissertation Advisory Committee (“DAC”)
meeting, and subsequently withdrawing him as a graduate student at Harvard based upon the
same refusal to attend a meeting of his DAC without leave of court. German also alleges that he
informed Harvard that his only reason for not attending the meetings was Harvard’s unilateral
insistence that German change his academic or “thesis” advisor, and the potential negative effects
that such a change would have on German. As a result, German claims he is precluded from
completing his research or submitting it for publication, as he is not affiliated with any academic
institution. In response, Harvard argues (a) that it was not subject to the Order until May 31,
2017, and the offending actions took place prior to that date, and (b) nothing in the Order
absolved German from compliance with Harvard’s internal rules concerning student discipline or
academic achievement.
Harvard has been a participant in this case since September 6, 2016, one week after this
court’s original harassment order issued, stating that German was to be allowed to continue and
complete his research and thesis. Harvard’s contention that it was a non-party, unaware that it
had obligations under the court’s orders concerning German is untenable on this record.
Regardless, Harvard is still bound by the orders because it (1) was a participant in the
proceedings, making suggestions to achieve its goal of keeping the Rubin Lab open and German
able to function there, (2) made express agreements to perform certain tasks that were codified in
the orders, and (3) worked in concert with Rubin throughout this action to comply, or perhaps
Notwithstanding this court’s original Order, that German be immediately 11 restored to the Rubin Lab, he did not
get key card access for two months.
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avoid compliance,11 with the court’s original order, as amended.
This court is mindful of past decisions warning against court interference with academic
and disciplinary decisions made by private colleges and universities. See Schaer v. Brandies
Univ., 432 Mass. 474, 482 (2000); Russell v. Salve Regina Coll., 890 F.2d 484, 489 (1st Cir.
1989), rev’d on other grounds, 499 U.S. 225 (1991). Unfortunately, Harvard, by its actions, has
left this court with little choice but to find its administrative withdrawal of German under these
circumstances, as alleged, sufficient to state a violation of the Order.
The December 5, 2016 Order is clear and unequivocal that German was to be restored to
his research position so as to complete his research, thesis, and Ph.D. Such restoration
necessarily includes the academic supervision he enjoyed prior to the harassment. Harvard’s
alleged insistence that it could unilaterally change German’s thesis advisor is sufficient to state a
violation of the clear language of the Order.
Given the history before this court, if changing German’s academic advisor had become a
point of contention, it is concerning that Harvard did not petition this court to effectuate a change
to the Order. The amount of time that past between Harvard’s notice to German of possible
administrative action (March 20, 2017) and its decision to withdraw him from the university
(May 16, 2017), during which Harvard decided not to seek clarification from this court, is
suspect. These facts, as well as German’s allegation that Harvard’s failure to seek a hearing
before this court prior to acting to withdraw German was intentional, are sufficient to state a
claim for violation of the Order.
There is little doubt that withdrawing German from Harvard violated the Order’s
17
direction that he be “fully restored” and “remain in his position and research.” If Harvard felt
compelled to violate that portion of the Order, for cause, it had ample opportunity to seek review
and modification of the Order by this court. Without such modification, however, the facts as
pled may entitle German to relief for Harvard’s violation of paragraphs 2 and 3 of the Order.
f. Failure to Provide Research Assistants
Concerning the failure to provide German with the research assistants described in the
Order, Harvard claims that it hired a full-time research assistant for German, but German refused
to meet with her to allow her to begin work. Id. at pp. 19-20. German claims he only did so as
Harvard had imposed time constraints; why spend the time training an assistant if an
unreasonably short period of employment is all that is permitted. Rubin argues that since
Harvard agreed to make funds available to hire German a new research assistant, the Order’s
direction for him to release “necessary” funds to Harvard has not been triggered.
The portion in the Order pertaining to providing research assistants is linked to the Order
for Rubin to “release … whatever funds are necessary” to obtain for German the resources he had
on March 10, 2016. This court finds it troubling that German has yet, ten months since the initial
Order, to be provided with the described research assistants. All parties agree that Harvard has
made those funds available; thus, as stated above, Rubin’s obligation to release funds has not
been triggered. Given the factual dispute between Harvard and German as to the reason no
research assistance has been provided in the past ten months, this is an issue to be determined
during the contempt trial.
ORDER
It is, therefore, ORDERED that both Rubin’s Motion to Dismiss (Paper No. 134) and
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Harvard’s Motion to Dismiss (Paper No. 136) are ALLOWED in part and DENIED in part. As
toGerman’s claims for contempt for Rubin’s failure to turn over funds, Rubin’s failure to hold
“lab meetings,” Harvard’s use of security guards, and Harvard and Rubin’s alleged denial of
access to Rooms B03 and B05, the motions are ALLOWED. As to the other alleged claims, that
Rubin has failed to supervise German’s research and dissertation, that Harvard’s administrative
proceedings and eventual withdrawal of German violated the Order, Harvard’s failure to provide
research assistants and that defendants have denied German access to resources and equipment
needed for his research, the motions are DENIED.
The contempt trial remains scheduled for 2:00 P.M. on July 11, 2017, though witnesses
need not be present.
_________________________
Elizabeth Fahey
Justice of the Superior Court
DATED: July ____, 2017 read more

Posted by Stephen Sandberg - September 5, 2017 at 8:58 pm

Categories: News   Tags: , , , ,

A.P. v. M.T. (Lawyers Weekly No. 11-113-17)

NOTICE:  All slip opinions and orders are subject to formal revision and are superseded by the advance sheets and bound volumes of the Official Reports.  If you find a typographical error or other formal error, please notify the Reporter of Decisions, Supreme Judicial Court, John Adams Courthouse, 1 Pemberton Square, Suite 2500, Boston, MA, 02108-1750; (617) 557-1030; SJCReporter@sjc.state.ma.us

16-P-202                                        Appeals Court

A.P.  vs.  M.T.

No. 16-P-202.

Essex.     January 6, 2017. – September 1, 2017.

Present:  Kafker, C.J., Hanlon, & Agnes, JJ.[1]

Civil Harassment.  Harassment PreventionEvidence, Cross-examination, Identification.  Identification.

Complaint for protection from harassment filed in the Essex County Division of the Juvenile Court Department on October 30, 2015.

The case was heard by Mark Newman, J. read more

Posted by Stephen Sandberg - September 1, 2017 at 4:48 pm

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O’Connor Constructors, Inc. v. HVAC Compensation Corporation, et al. (Lawyers Weekly No. 12-099-17)

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COMMONWEALTH OF MASSACHUSETTS
SUFFOLK, ss. SUPERIOR COURT
CIVIL ACTION
NO. 15-0205-BLS1
O’CONNOR CONSTRUCTORS, INC.
vs.
HVAC COMPENSATION CORPORATION and others1
MEMORANDUM OF DECISION AND ORDER ON
DEFENDANTS’ MOTION FOR SUMMARY JUDGMENT
In this action, the plaintiff, O’Connor Constructors, Inc. (O’Connor), seeks to recover sums paid by the defendant HVAC Compensation Corporation (HVAC), a non-profit corporation established as a workers compensation self-insurance group or SIG, to purchase a loss portfolio transfer (LPT) insurance policy. O’Connor withdrew from HVAC at the end of 2009. It asserts that a substantial portion of the surplus that HVAC used to purchase the LPT policy should have been distributed to it as dividend. O’Connor also seeks to set aside an assessment that HVAC issued against O’Connor for additional funds to cover a liquidity deficit created by the purchase of the LPT policy. The additional defendants are the trustee/directors of HVAC (hereafter referred to as the Directors), each of whom are representatives of the companies that comprise the SIG, as well as the member companies themselves. While O’Connor’s complaint initially pled seven counts, four were previously dismissed. Three counts remain: breach of contract (Count I), breach of fiduciary duty (Count VI), and violation of G.L. c. 93A (Count VII). The
1 (i) Richardd Donohoe, William J. Lynch, Kevin R. Gill, James Morgan, Paul M. Level, Jr., and Shane B. Hamel, each sued individually and as Trustee/Director of HVAC, and (ii) Harrington Bros. Corporation, William V. Lynch Co., Inc., McCusker-Gill co., Inc., Worcester Air Conditioning, LLC, Le Bel, Inc., and Hamel & McAlister, Inc.
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case is now before the court on the defendants’ motion for summary judgment. For the following reasons, the motion is DENIED as to Counts I and VI and ALLOWED as to Count VII.
FACTS
The following facts are either undisputed or viewed in the light most favorable to O’Connor, the non-moving party.
In 1992, HVAC was organized to operate as a workers’ compensation SIG pursuant to G.L. c. 152, §§25E – 25U. Its members were companies principally engaged in the heating, ventilation, and air conditioning trades in Massachusetts. While a SIG is permitted to organize itself in various forms, HVAC was organized as a not-for-profit corporation under G.L. c. 180, § 4(n). Each HVAC member is required to enter into an Application and Indemnity Agreement (Indemnity Agreement) and is bound by HVAC’s by laws. Material to this case is a provision in G.L. c. 180, § 3 which provides that not-for-profit corporations, like HVAC, may not through their articles of organization or bylaws eliminate the personal liability of its directors “ (i) for any breach of the . . . director’s duty of loyalty to the corporation or its members, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, or (iii) for any transaction from which the . . . director derived an improper personal benefit.” HVAC’s organizational documents do not purport to limit its Director’s liabilities in a manner inconsistent with this statutory requirement.
The Board of Directors of HVAC directs the management of its affairs including determining the contributions ( i.e., premiums) to be paid by the members each year for their workers’ compensation coverage in accordance with rates established by the Division of Insurance, administering and managing HVAC’s funds, including its reserves, and, of note in this
3
case, purchasing insurance and reinsurance. In practice, the Board retained a professional, third-party administrator, FutureComp, to manage its business and affairs.
Of importance to this case is the manner in which HVAC distributed its surplus, i.e., funds maintained by HVAC in excess of the reserves that its actuaries determined would be needed to pay claims that have been asserted by covered employees, as well as claims that are estimated to be asserted for incidents occurring during a “fund year” but which have not yet been reported, so-called IBNR. To the extent that premiums collected from members for a given year exceed claims paid and actuarially estimated claims that will have to be paid in the future, plus expenses incurred in operating the SIG, that year has a surplus. If claims paid and estimated to be paid and operating expenses with respect to a fund year exceed the premium collected, that year is running a deficit. According to Section 12 of the Indemnity Agreement (as amended),
Any Positive Balance of the Group resulting from overall loss experience may be available as a policyholder dividend . . . or used as a reserve in accordance with a Positive Balance Provisions Plan as set forth in Schedule 3 or as adopted and amended from time to time by the Board of Directors of the Group in its sole discretion. In accordance with Section 25P of Chapter 152 of the Massachusetts General Laws, a refund for any Fund Year shall be paid only to those employers who remain participants in the group until December 31st of the Fund year. Payment of a refund based on a previous Fund Year shall not be contingent on continued membership in the group after that Fund Year.
The Division of Insurance has issued regulations that create a formula pursuant to which a SIG may distribute surplus from any fund year to its members. In general, it permits the surplus to be distributed ratably in four installments over five years with the first distribution made two years after the close of the fund year. For a fund year with a surplus, each HVAC member receives a percentage of the surplus determined by the amount of the premium that it paid that year multiplied by that member’s loss ratio for that year—this is referred to as the member’s “combined ratio.” In consequence, the amount, if any, that any member receives for a surplus year is dependent on that member’s own premium amount and loss experience for that year.
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If a fund year has a deficit, HVAC assesses the deficit to its members for that year using the same statutory formula that is used to calculate distributions. As with distributions, deficits begin to be collected two years after the close of a fund year. Once a year, usually in November or December, HVAC members who are in a negative position receive an invoice for payment due; members who have a net surplus are issued a dividend check in January. The amount of surplus or deficit for any given fund year may change from year to year as claims develop and are paid and IBNR recalculated. Surplus calculations vary most in the first two years following the end of the fund year, but they may continue to change in subsequent years.
HVAC has always calculated and paid dividends or assessed deficits based on individual fund year results. As noted above, a former member is entitled to the distribution of surplus for any year in which it was a member, if there is surplus available to distribute. Similarly, a former member could be required to contribute additional amounts to cover a deficit with respect to any period in which it was a member of the SIG. HVAC has also purchased reinsurance and charged its costs to its members on a fund year by fund year basis.
O’Connor became a member of HVAC in 1993, at that point HVAC had six members. By 2004, it had increased to ten members. Effective December 31, 2009, O’Connor withdrew from HVAC, at which point HVAC had only seven members. For the last several years that O’Connor was a member of HVAC, it paid significantly higher premiums than any other member. For example, in 2009 when HVAC had eight members, O’Connor’s premium was almost four times that of the next highest premium and amounted to approximately 44% of all premiums paid that year. After 2009, O’Connor no longer had a representative on the HVAC Board of Directors and, therefore, no vote on any matter affecting HVAC’s management or affairs.
In the years 2007 through 2010, O’Connor was required to pay substantial deficit
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assessments in respect of earlier years, approximately $ 1 million in the aggregate. Thereafter, its accounts moved to surplus status, and it received a dividend in January, 2012. An internal memorandum prepared in May, 2012 suggested that O’Connor was in a surplus position of $ 450,000, a number which is, in effect, a snapshot of surplus at a given moment and was principally based on favorable development for 2008 and 2009, although these fund years were not then fully available for distribution under the formula described above. At the same time, the 2010 and 2011 fund years were developing adversely to the continuing HVAC members such that they reflected deficits of nearly $ 400,000 and $ 261,000, respectively, as of the end of 2011.
O’Connor’s departure and the deficits for 2010 and 2011 placed HVAC in a difficult situation in which its continuing viability was at issue. In consequence, it began to explore the option of purchasing an LPT to insure all additional claim exposure for HVAC. Quotes were received from Safety National Casualty Corporation (Safety) to purchase LPT for various years. “Option 1” sold off fund years 1992 through 2009. The cost of this policy was $ 1,899,104. HVAC, however, was holding reserves for those years only in the amount of $ 1,433,120. Therefore, this LPT would cost $ 465,984 in excess of the reserves determined by its actuaries as necessary to cover anticipated claims for those years. An analysis was done that determined the cost of the LPT for each fund year being sold, the amount by which that cost exceeded the reserves for that year, and then assigned a percentage of that cost to each member based on a fraction, the numerator of which was that member’s premium for that year and the denominator was the aggregate premiums collected for that year. The surplus for any year was left untouched and therefore available for distribution as dividends. One Director expressed concern that this approach would be very costly, essentially causing HVAC to incur an immediate expense of $ 465,984 (the cost of the LPT in excess of reserves for the years sold off) without addressing the
6
deficits that existed for fund years 2010 and 2011. FutureComp then requested additional quotes for LPTs that covered 2010 and 2011.
At a September, 2012 HVAC Board meeting, FutureComp presented the additional quotes and a new method for paying for the LPT policy. Under this payment approach, all of the surplus held in HVAC’s accounts would be used to purchase the policy, without regard to the fund year in which the surplus was accrued. Because this would effectively eliminate nearly all of HVAC’s assets, all members and former members for the years “sold off” would be assessed a liquidity deficit. No consideration was given to the fact that operating costs and payment of current claims would be with respect to years in which members who terminated prior to January 1, 2011 had no possible liability, as all of the years in which they had been members had been sold off. FutureComp referred to this method of purchasing the LPT policy as the “All Assets” approach, to be distinguished from the approach that looked at the costs of purchasing the LPT policy on a year by year and member by member basis, which it called the “Strict Assessment” approach.
On November 14, 2012, the Directors voted to purchase an LPT from Safety selling off fund years 1992 to 2010 using the “All Assets” approach, the policy to cover all claim payments due in respect of those years after July 27, 2012. The cost of the LPT was $ 1,855,938. Because this transaction was financed with surplus funds, it created a liquidity deficit of $ 164,750 for fund years 2011 and 2012 (which had not been sold). The Directors therefore assessed a liquidity deficit pro rata to members and former members. O’Connor’s assessment was $ 55,931. Because the LPT covered all claims paid after July 27, 2012 for fund years 1992-2010 and the policy could not be made operational until May 22, 2013, the LPT carrier refunded to HVAC $ 504,332 for claims that HVAC paid during that period in respect of claims now covered by the LPT.
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O’Connor received no credit for that refund.
On January 13, 2013, the Division of Insurance approved the transaction. O’Connor was not informed about the transaction prior to its closing and was not given the opportunity to present its position to the Division concerning the inclusion of fund year 2010 in the LPT or the use of the All Asset method to purchase it. But for the purchase of the LPT, O’Connor would have been due a dividend of $ 185,647 in January, 2013 closing out all fund years through 2007, 50% of its surplus for 2008 and 33% of its surplus for 2009. If the LPT had been purchased using the Strict Assessment Approach, O’Connor would have been entitled to $ 290,000 return of its surplus, net of assessments for the cost of the LPT in excess of reserves for the years in which it had been a HVAC member. Conversely, in December, 2012, continuing HVAC members would have been assessed deficits because fund year 2010 was, as noted above, in a substantial deficit position. Following the transaction, an employee of FutureComp wrote in an email: “Overall, there is still a great story. The members were going to assess themselves anyway, with the end result of O’Connor getting a large dividend. This way, they are only assessing themselves to meet the payment of the LPT to get rid of all the ‘bad years.’”
DISCUSSION
Breach of Contract
O’Connor argues that while the By Laws authorized the Board to purchase insurance, and it concedes that the LPT is a form of insurance, the Indemnity Agreement effectively required that the cost of that insurance be charged to members on a fund year by fund year basis, which is the way reinsurance had been purchased by HVAC in the past. Furthermore, when the concept of purchasing the LPT was first investigated, the cost to each member was actually calculated
8
using the “Strict Assessment” method, i.e., year-by-year and member-by-member. It was only when one Director questioned the value of the proposed LPT to HVAC and his company that FutureComp asked for quotes that covered the “bad years” and came up with the “All Asset” option. O’Connor contends that use of the All Asset approach, and using those assets to purchase LPT for a year in which O’Connor was not a member, breached the Indemnity Agreement.
At oral argument on this motion, the court asked counsel for O’Connor to identify the contract provision that HVAC breached in purchasing the LPT using the All Asset approach. O’Connor pointed to Section 12 of the Indemnity Agreement (quoted above) and Schedule 3 appended to it. Schedule 3 states, in relevant part,
The Board of Directors of HVAC . . . will, after the end of each Fund Year, determine the Positive Balance available for distribution to the Members as a return of premium . . . . The Positive Balance shall be determined after appropriate allowance is made for contingency reserves.
The Positive Balance shall be distributed to Members based upon each Member’s combined ratio (losses and expenses/earned premium).
According to O’Connor, the Directors voted on the amount of surplus to be distributed for fund years through 2009, and were therefore contractually obligated to pay that surplus to O’Connor, when they decided to use the surplus to purchase the LTP, without regard to the cost of the LPT for each year being sold off. O’Connor argued that the language in Section 12 of the Indemnity Agreement that expressly stated that “Any Positive Balance of the Group resulting from overall loss experience may be available as a policyholder dividend, . . . or used as a reserve in accordance with a Positive Balance Provisions Plan as set forth I Schedule 3 or as adopted and amended from time to time by the [Directors] in its sole discretion,” did not authorize the Directors to decide to use surplus from one fund year to cover claim expenses with respect to another year, when the Directors had previously voted to distribute that surplus to the members
9
according to each member’s combined ratio. (emphasis added)
The court finds that the Indemnity Agreement and By Laws, which constitute the contract among the members, is ambiguous with respect to the question presented. See Citation Ins. Co. v. Gomez, 426 Mass. 379, 381 (1998). In particular, it is ambiguous when applied to the circumstances presented by this case in which LPT insurance was purchased in late 2012 with respect to all of HVAC’s years of operation through 2010. See, e.g., Nelson v. Cambridge Mut. Fire Ins. Co., 30 Mass. App. Ct. 671, 673-674 (1991) (Where the court noted that words that are otherwise clear may be ambiguous as applied to certain subject matter.) For example, it may be that the Directors have the authority to use all available surplus to respond to a catastrophic loss, but not to take surplus from one year to pay claims associated with another year that are not out of the ordinary. In this case, the purchase of the LPT created a substantial expense for HVAC, but it was the result of a business decision not, as this court understands the facts, a unique and unanticipated loss. While the court doubts that evidence exists as to the intention of the members when the Indemnity Agreement was drafted, evidence of the manner in which these provisions of the Indemnity Agreement were applied in the past or are being applied in a manner which is consistent with industry practices might elucidate contract meaning. See Browning-Ferris Ind. Inc., v Casella Waste Management of Mass., Inc. 70 Mass. App. Ct. 300, 309 (2011) (“There is no surer way to find out what the parties meant, than to see what they have done”).
Moreover, while the question of whether HVAC’s purchase of the LPT using the All Assets method constitutes a breach of contract is a very close question, as discussed below, the claim for breach of fiduciary duty clearly involves disputed questions of fact and must proceed to trial. The evidence to be presented on this breach of contract claim is very much the same as that which will be presented on the breach of fiduciary duty claim. The court finds that while
10
questions of law rather than fact are more predominant and central to this breach of contract claim, it is better resolved after the court has had the benefit of a trial addressing questions of how the Directors came to choose this approach to resolving the issues confronting HVAC by O’Connor’s decision to withdraw from the SIG.
Breach of Fiduciary Duty
As noted, HVAC is a not-for-profit corporation organized under Chapter 180 of the General Laws and, therefore, each Director may be liable to a member “ (i) for any breach of the . . . director’s duty of loyalty to the corporation or its members, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, or (iii) for any transaction from which the . . . director derived an improper personal benefit.” Although, effective December 31, 2009, O’Connor ceased to be a member of HVAC, the Directors still controlled funds in which O’Connor had an interest under Section 12 of the Indemnity Agreement. (“Payment of a refund based on a previous Fund Year shall not be contingent on continued membership in the group after that Fund Year.”) Additionally, their management of HVAC had the capacity to cause O’Connor to incur additional liabilities with respect to matters relating to fund years in which O’Connor was a member. (“A member of a group, . . . , who elects to terminate its membership . . . shall remain jointly and severally liable for the workers’ compensation obligations of the group and its members which were incurred during the . . . terminated member’s period of membership;” and, “[a] group member is not relieved of its workers’ compensation liabilities incurred during its period of membership except through payment by the group or the member of required workers’ compensation benefits.” G.L. c. 152, § 25K (3) and (4).) In consequence, the Directors continue to owe fiduciary duties of loyalty to a
11
departed member and an obligation not to take action to benefit their own interests at the expense of terminated member, to the extent their actions implicate the former member’s interest in surplus or the creation of additional liabilities for the former member.2
Whether, in this case, the course of action adopted by the Directors breached their fiduciary obligations to O’Connor involve a number of disputed issues of fact. Certainly, Directors owe fiduciary duties to all members and HVAC, as well as O’Connor. They may adopt a course of action, in good faith, which is a reasonable approach to a business problem and in the best interests of the enterprise and its members, generally. See, e.g., Wilkes v. Springside Nursing Home, Inc., 370 Mass. 842, 851-852 (1976). Whether they did that in this case when they purchased the LPT using the All Assets approach, and included fund year 2010 in the liabilities sold off, involves a number of disputed issues of fact that can only be resolved after trial.3
Chapter 93A
It has long been recognized that intra-enterprise disputes will not support claims of violation of Chapter 93A. See Linkage Corp. v. Trustees of Boston University, 425 Mass. 1 n.33, cert. denied 522 U.S. 1015 (1997) and cases there cited. This case involves quintessentially intra-corporate action. It does not arise out of an arms-length commercial transaction between O’Connor and HVAC or its Directors. Rather, the issue is whether HVAC’s decision to purchase an LPT policy using the All Assets method constituted a breach of its internal, organizational documents or a breach of fiduciary duty on the part of the Directors to treat O’Connor fairly. See
2 Indeed, in this case the purchase of the LPT led to the assessment of a liquidity assessment against O’Connor.
3 For example, for reasons that are not well explained, it seems that the LPT covering 2010 was less expensive than that which ended with 2009. This could be because the quote for the 2009 LPT was received well before the quote for the LPT that was purchased and might have cost much less (claims are constantly being paid and reducing the exposure to the insurer issuing the LPT policy) if the quotes were as of the same date. Issues such as these require factually development.
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Ray-Tek Services, Inc. v. Parker, 64 Mass. App. Ct. 165, 170-171 (2005). In consequence, the claim for violation of Chapter 93A must be dismissed.4
ORDER
For the foregoing reasons, HVAC’s motion for summary judgment is ALLOWED, in part, and DENIED, in part. Count VII is dismissed; Counts I and VI shall proceed to trial.
_______________________
Mitchell H. Kaplan
Justice of the Superior Court
Dated: July 27, 2017
4 HVAC argues that the claims asserted against it should be dismissed because the Division of Insurance approved the transaction. There is, however, no indication that the Division gave any thought to whether the transaction was fair to all members or former members or breached a contractual obligation among the members. There is no suggestion that it had statutory authority to do that. Presumably, the Division was only concerned with whether HVAC would be financially able to meet its workers’ compensation benefit obligations following the transaction. The court finds that the Division’s approval of the transaction is not relevant to the claims asserted by O’Connor against HVAC or the Directors. read more

Posted by Stephen Sandberg - August 31, 2017 at 10:56 pm

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Mooney, et al. v. Diversified Business Communications, et al. (Lawyers Weekly No. 12-116-17)

COMMONWEALTH OF MASSACHUSETTS

SUFFOLK, ss.                                                                                   SUPERIOR COURT

                                                                                                             SUCV2016-3726-BLS2

            JOHNJ. MOONEY and MORGAN D. WHEELOCK,

Plaintiffs

vs.

 

DIVERSIFIED BUSINESS COMMUNICATIONS, DBC PRI-MED, LLC,

THEODORE WIRTH, KATHY WILLING, and OAKLEY DYER

Defendants

MEMORANDUM OF DECISION AND ORDER

ON REMAING ISSUES RELATED TO

 PLAINTIFFS’ MOTION TO COMPEL

 

After a hearing on July 11, 2017, this Court allowed that part of the plaintiffs’ Motion to Compel which concerned the production of certain Board of Directors minutes of the defendant Diversified Communications. See Memorandum of Decision and Order on Plaintiffs’ Motion to Compel, dated July 20, 2017.    As to the remainder of the motion,  this Court concluded that the  defendants  could withhold certain documents based on a claim of privilege, provided that the privilege had been properly asserted as to those documents actually withheld (represented by both sides to be a couple of dozen); that  determination would be made by the Court after it reviewed  those documents in camera.   The Court also allowed the defendants time to respond to a last-minute assertion by the plaintiffs that any claim of privilege had been waived.  After a flurry of additional briefing and after conducting an in camera review, this Court concludes that the defendants need not to produce any additional documents and that the plaintiffs must return to the defendants those  documents that had been produced inadvertently. read more

Posted by Stephen Sandberg - August 31, 2017 at 7:21 pm

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Cort v. Majors (Lawyers Weekly No. 11-112-17)

NOTICE:  All slip opinions and orders are subject to formal revision and are superseded by the advance sheets and bound volumes of the Official Reports.  If you find a typographical error or other formal error, please notify the Reporter of Decisions, Supreme Judicial Court, John Adams Courthouse, 1 Pemberton Square, Suite 2500, Boston, MA, 02108-1750; (617) 557-1030; SJCReporter@sjc.state.ma.us

16-P-694                                        Appeals Court

TCHAD CORT  vs.  ALVER MAJORS.

No. 16-P-694.

Suffolk.     May 10, 2017. – August 31, 2017.

Present:  Milkey, Sullivan, & Henry, JJ.

Summary Process.  Practice, Civil, Summary process, Jury trial, Waiver of trial by jury.  Constitutional Law, Trial by jury, Waiver of constitutional rights.

Summary Process.  Complaint filed in the Boston Division of the Housing Court Department on September 2, 2015. read more

Posted by Stephen Sandberg - August 31, 2017 at 3:45 pm

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Valente v. TB Bank, N.A. (Lawyers Weekly No. 11-117-17)

NOTICE:  All slip opinions and orders are subject to formal revision and are superseded by the advance sheets and bound volumes of the Official Reports.  If you find a typographical error or other formal error, please notify the Reporter of Decisions, Supreme Judicial Court, John Adams Courthouse, 1 Pemberton Square, Suite 2500, Boston, MA, 02108-1750; (617) 557-1030; SJCReporter@sjc.state.ma.us

16-P-1119                                       Appeals Court

GERALD VALENTE, executor,[1] and trustee,[2]  vs.  TD BANK, N.A.[3]

No. 16-P-1119.

Worcester.     March 3, 2017. – August 30, 2017.

Present:  Agnes, Kinder, & Shin, JJ.

Bank.  Negligence, Bank.  Notice, Timeliness.  Uniform Commercial Code, Bank, Notice, Payment on negotiable instrument.  Negotiable Instruments, Payment.

Civil action commenced in the Superior Court Department on October 25, 2011. read more

Posted by Stephen Sandberg - August 30, 2017 at 2:43 pm

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Commonwealth v. Villagran (Lawyers Weekly No. 10-145-17)

NOTICE:  All slip opinions and orders are subject to formal revision and are superseded by the advance sheets and bound volumes of the Official Reports.  If you find a typographical error or other formal error, please notify the Reporter of Decisions, Supreme Judicial Court, John Adams Courthouse, 1 Pemberton Square, Suite 2500, Boston, MA 02108-1750; (617) 557-1030; SJCReporter@sjc.state.ma.us

SJC-12239

COMMONWEALTH  vs.  JONATHAN VILLAGRAN.

Norfolk.     March 7, 2017. – August 29, 2017.

Present:  Gants, C.J., Lenk, Hines, Gaziano, Lowy, & Budd, JJ.[1]

Firearms.  Controlled Substances.  Disturbing the Peace.  Constitutional Law, Search and seizure, Reasonable suspicion, Probable cause.  Search and Seizure, Reasonable suspicion, Protective frisk, Probable cause.  Probable Cause.

Complaint received and sworn to in the Quincy Division of the District Court Department on March 26, 2015. read more

Posted by Stephen Sandberg - August 29, 2017 at 5:15 pm

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