The Hanover Insurance Group, Inc. v. Raw Seafoods, Inc. (Lawyers Weekly No. 11-048-17)
NOTICE: All slip opinions and orders are subject to formal revision and are superseded by the advance sheets and bound volumes of the Official Reports.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 15-P-1554 Appeals Court THE HANOVER INSURANCE GROUP, INC. vs. RAW SEAFOODS, INC. No. 15-P-1554. Suffolk. September 16, 2016. – April 26, 2017. Present: Agnes, Neyman, & Henry, JJ. Insurance, General liability insurance, Coverage. Words, “Occurrence.” Civil action commenced in the Superior Court Department on September 21, 2012. The case was heard by Christine M. Roach, J., on motions for summary judgment. Michael J. Daly (Samuel P. Blatchley also present) for the defendant. Jeffrey E. Dolan (Anthony M. Campo also present) for the plaintiff. NEYMAN, J. In this case we analyze whether damage to scallops at a seafood processing facility, where the precise cause of damage is unknown, constituted an “occurrence” within the meaning of a commercial general liability (CGL) policy. A Superior Court judge concluded that the defendant-insured, Raw Seafoods, Inc. (RSI), has no reasonable expectation of proving that its claimed loss was caused by an occurrence, and granted summary judgment in favor of the plaintiff-insurer, Hanover Insurance Group, Inc. RSI appeals therefrom. We reverse. Background. 1. RSI and the damaged scallops. RSI is a seafood processing facility in Fall River. One of RSI’s customers, Atlantic Capes Fisheries, Inc. (Atlantic), sells scallops and other types of seafood around the world. Atlantic purchases fresh scallops from fishing vessels, then transports the scallops to RSI for processing, portioning, packaging, and freezing. RSI’s staff inspects the scallops for quality upon arrival, reports the results to Atlantic, and receives processing instructions from Atlantic. After processing, the scallops are transported to Arctic Cold Storage (Arctic), a third-party cold storage facility. Atlantic then ships its customers’ orders directly from Arctic’s facility. RSI handles approximately 4 million to 6 million pounds of scallops for Atlantic per year. In July, 2011, RSI-processed scallops were making their way through customs in Denmark, heading to an Atlantic customer. Upon inspection, the 37,102 pounds of scallops were found to be decomposed, exhibited a strong ammonia smell, and were deemed unacceptable for human consumption. By all accounts, something was rotten in the state of Denmark.[1] The United States Food and Drug Administration tested the scallops and confirmed that they were spoiled. The scallops were then returned to Arctic’s facility, where representatives from Atlantic and RSI jointly inspected the shipment and confirmed the damage. They also inspected another batch […]
Liberty Mutual Insurance Co. v. Peoples Best Care Chiropractic and Rehabilitation, Inc., et al. (Lawyers Weekly No. 12-047-17)
COMMONWEALTH OF MASSACHUSETTS SUFFOLK, ss. SUPERIOR COURT. 1684CV01239-BLS2 ____________________ LIBERTY MUTUAL INS. CO. v. PEOPLES BEST CARE CHIROPRACTIC AND REHABILITATION, INC.; PLEASANT VALLEY CHIROPRACTIC LLC; and RAGHUBINDER BAJWA, M.D., P.C. ____________________ MEMORANDUM AND ORDER ALLOWING PLAINTIFF’S MOTION FOR SUMMARY JUDGMENT This lawsuit concerns the rates that Liberty Mutual Insurance Company pays to chiropractic clinics under Personal Injury Protection (“PIP”) benefit provisions in personal automobile insurance policies. Liberty seeks a declaration that an Illinois court’s final judgment that approved the settlement of a nationwide class action regarding these rates is entitled to full faith and credit in Massachusetts and binds the three Defendants, who did not opt out of the Illinois proceeding and therefore are members of the plaintiff class in that case. Defendant Raghubinder Bajwa, M.D., P.C., was defaulted for failing to answer the complaint. Defendants Peoples Best Chiropractic and Rehabilitation, Inc. (“PBC”) and Pleasant Valley Chiropractic LLC (“PVC”) (collectively, the remaining “Defendants”) oppose Liberty’s request and assert counterclaims seeking to bar Liberty from implementing the settlement. The Court concludes that Liberty is entitled to summary judgment in its favor on all claims. With respect to Liberty’s affirmative claim, the Court concludes that there is an actual controversy between the parties and that the Illinois final order and judgment is entitled to full faith and credit in Massachusetts courts. In addition, Liberty is entitled to judgment as a matter of law on Defendants’ counterclaims. Defendants sought leave to conduct certain discovery before the Court decided Liberty’s summary judgment motion. The Court denies this request because none of the discovery sought by Defendants concerns any factual issue relevant to whether Liberty is entitled to summary judgment. 1. Factual Background. Liberty was the defendant in a multi-state class action filed in Illinois state court to challenge the way Liberty determines what rates it will pay to chiropractors and other medical care providers under the no-fault PIP – 2 – provisions of personal automobile insurance policies. The Illinois case was captioned Leonon Chiropractic Clinic, P.C. v. Liberty Mutual Insurance Company and docketed as Illinois Circuit Court for St. Clair County, no. 14-L-52. Liberty compares billed charges for medical treatment to a database of charges that Liberty believes are for similar services provided in the same geographic area. Since 2011 Liberty has done so using data maintained by a non-profit company called FAIR Health, Inc. Liberty generally refuses to pay rates any higher than the 80th percentile of similar charges according to the FAIR Health data. The plaintiffs in the Illinois case claimed that this practice was unlawful. The parties to the Illinois lawsuit entered into a Stipulation of Settlement in October 2014 that would resolve all claims on behalf of a proposed class. […]
In re ReWalk Robotics Ltd. Stockholder Litigation (Lawyers Weekly No. 12-048-17)
COMMONWEALTH OF MASSACHUSETTS SUFFOLK, ss. SUPERIOR COURT. 1684CV03336-BLS2 1684CV03670-BLS2 ____________________ IN RE REWALK ROBOTICS LITD. STOCKHOLDER LITIGATION ____________________ MEMORANDUM AND ORDER DENYING DEFENDANTS’ MOTION TO STAY PENDING PARALLEL FEDERAL PROCEEDINGS The named plaintiffs in these putative class actions claim that ReWalk Robotics Ltd. and thirteen other defendants are liable under §§ 11, 12(a)(2), and 15 of the federal Securities Act because ReWalk purportedly made false statements in a registration statement and prospectus concerning a public offering of securities. The first of these actions was filed on October 31, 2016. The second was filed on November 30, 2016. They were consolidated on January 9, 2017. A similar lawsuit making similar Securities Act claims against the same Defendants was filed in the United States District Court for the District of Massachusetts on January 31, 2017. That lawsuit was docketed as Deng v. ReWalk Robotics et al., no. 1:17-cv-10179-FDS, and is pending before Judge Saylor. Defendants have moved to stay these state court proceedings pending dispositive resolution of this federal lawsuit.1 A trial judge has broad discretion to grant or deny a stay of proceedings pending resolution of the same or similar claims in another forum. Travenol Laboratories, Inc. v. Zotal, Ltd., 394 Mass. 95, 97 (1985). The Court concludes, in the exercise of its discretion, that there is no good reason to stay these actions. It will therefore DENY Defendants’ motion. 1 When Defendants filed their motion to stay, they represented that a second federal class action asserting similar claims had been filed against them in the United States District Court for the Northern District of California, and that Defendants have moved to have the two federal actions consolidated in the District of Massachusetts as a single multidistrict litigation proceeding. In their reply memorandum, however, Defendants report that the California action was voluntarily dismissed on March 23, 2017. As a result, there are currently only two sets of actions asserting similar Securities Act claims against ReWalk and the other Defendants: these two actions in Massachusetts Superior Court and the Deng case filed several months later in federal court in the District of Massachusetts. – 2 – Although Defendants argue that it would be inefficient for these cases and the pending federal action to proceed at the same time, they do not muster any convincing explanation as to why they seek a stay of these actions in Massachusetts court rather than asking the federal judge to stay the later-filed federal action. The first of these consolidated actions was filed in the Massachusetts Superior Court three months before the pending federal action was filed. Furthermore, the additional factual allegations asserted in the consolidated complaint in these actions suggest that the state court plaintiffs have […]
Categories: News Tags: 1204817, Lawyers, Litigation, Ltd., ReWalk, Robotics, Stockholder, Weekly
The Gillette Company v. Provost, et al. (Lawyers Weekly No 12-040-17)
COMMONWEALTH OF MASSACHUSETTS SUFFOLK, ss. SUPERIOR COURT. 1584CV00149-BLS2 ____________________ THE GILLETTE COMPANY v. CRAIG PROVOST, JOHN GRIFFIN, WILLIAM TUCKER, DOUGLAS KOHRING, and SHAVELOGIC, INC. ____________________ MEMORANDUM AND ORDER ON CROSS-MOTIONS FOR SUMMARY JUDGMENT The Gillette Company alleges that four former employees helped ShaveLogic, Inc., develop a new disposable cartridge shaving razor using Gillette’s confidential information. Gillette claims that in so doing Defendants violated G.L. c. 93A, the individual defendants breached non-disclosure agreements with Gillette, and all five Defendants engaged in a civil conspiracy. It also claims that ShaveLogic’s patents and patent applications should be subjected to a constructive trust in favor of Gillette. Gillette does not claim that any of the individual defendants breached a covenant not to compete with Gillette. The parties previously stipulated to the dismissal with prejudice of Gillette’s trade secret claims.1 ShaveLogic claims, in turn, that Gillette intentionally interfered with prospective business relations and violated c. 93A, by threatening to bring and then filing baseless legal claims in an attempt to keep ShaveLogic from entering the market for so-called wet-shaving products. The parties have filed cross-motions for summary judgment on all remaining claims and counterclaims. The Court concludes that Defendants are entitled to summary judgment in their favor on Gillette’s remaining claims because Gillette cannot prove that Defendants misused any of Gillette’s confidential information or that the individual defendants breached any non-disclosure agreement. The Court 1 The Court (Salinger, J.) previously ordered the dismissal with prejudice of Gillette’s claims against three other defendants. It dismissed Gillette’s claims that ShaveLogic’s general counsel breached fiduciary duties that he owed as a former Gillette patent counsel and that ShaveLogic’s CEO, its president, and the other individual defendants aided and abetted that alleged breach of fiduciary duty and conspired to bring it about. – 2 – also concludes that Gillette is not entitled to summary judgment on ShaveLogic’s counterclaims because a reasonable fact finder could conclude that Gillette had deliberately brought baseless claims in an attempt to bully ShaveLogic out of the market. The Court will schedule a final pre-trial conference to discuss trial of ShaveLogic’s counterclaims. 1. Gillette’s Claims. Defendants are entitled to summary judgment in their favor on Gillette’s remaining claims because the undisputed material facts show that Gillette has “no reasonable expectation of proving” at least one element of each of its claims. See Boazava v. Safety Ins. Co., 462 Mass. 346, 350 (2012). “A nonmoving party’s failure to establish an essential element of her claim ‘renders all other facts immaterial’ and mandates summary judgment in favor of the moving party.” Roman v. Trustees of Tufts College, 461 Mass. 707, 711 (2012), quoting Kourouvacilis v. General Motors Corp., 410 Mass. 706, 711 (1991). 1.1. Unfair Competition—G.L. c. […]
CRA International, Inc. v. Painter (Lawyers Weekly No. 12-039-17)
COMMONWEALTH OF MASSACHUSETTS SUFFOLK, ss. SUPERIOR COURT. 1684CV02417-BLS2 ____________________ CRA INTERNATIONAL, INC. v. DONALD J. PAINTER ____________________ MEMORANDUM AND ORDER ALLOWING PLAINTIFF’S MOTION FOR JUDGMENT ON THE PLEADINGS AND MOTION TO DISMISS COUNTERCLAIM This lawsuit arises from CRA International, Inc.’s short-lived employment of Donald J. Painter. CRA seeks a declaration that, because Mr. Painter worked for CRA for less than a year, Painter is contractually obligated to repay his $ 30,000 signing bonus and a $ 900,000 loan, pay all interest that has accrued on that loan, and reimburse CRA for reasonable attorneys’ fees and expenses incurred to collect that loan. Painter asserts that his employment agreement and promissory note were induced by intentional fraud or negligent misrepresentations and are therefore “invalid” and unenforceable. He also asserts a counterclaim for fraud and seeks leave to amend facts alleged in his counterclaim. The Court concludes that CRA is entitled to the dismissal of Painter’s counterclaim and that Painter’s proposed amendment of his counterclaim would be futile. It also concludes that, given the facts admitted by Painter in his answer and the failure of his fraud in the inducement defense, CRA is entitled to judgment in its favor on its claim for declaratory judgment. The Court will allow CRA’s motion for judgment on the pleadings and to dismiss Painter’s counterclaim, deny Painter’s motion to amend his counterclaim, deny CRA’s motion to strike Painter’s jury demand as moot, and order the entry of a declaratory judgment in CRA’s favor. 1. CRA’s Motion to Dismiss the Counterclaim. Painter’s counterclaim for fraud fails as a matter of law because it does not allege any facts plausibly suggesting that CRA made a false statement of material fact to Painter or that CRA failed to disclose some material information that it had a duty to disclose. See generally Lopez v. Commonwealth, 463 Mass. 696, 701 (2012) (to survive a motion to dismiss under Mass. R. Civ. P. 12(b)(6), a complaint or counterclaim must allege facts that, if true, would “plausibly suggest[] … an entitlement to relief”) (quoting Iannacchino v. Ford – 2 – Motor Co., 451 Mass. 623, 636 (2008), and Bell Atl. Corp. v. Twombly, 550 U.S. 544, 557 (2007)). Painter’s proposed amendment to his counterclaim would be futile for the same reasons. 1.1. The Counterclaim Fails to Allege Any Fraud with Particularity. A claim of fraudulent inducement must be alleged with particularity in accord with Mass. R. Civ. P. 9(b). See VMS Realty Inv., Ltd. v. Keezer, 34 Mass. App. Ct. 119, 119-120 (1993). This rule “heightens the pleading requirements placed on plaintiffs who allege fraud and deceit.” Equipment & Systems for Industry, Inc. v. NorthMeadows Constr. Co., Inc., 59 Mass. App. Ct. 931, 932 […]
The Gillette Company v. Provost, et al. (Lawyers Weekly No. 12-040-17)
COMMONWEALTH OF MASSACHUSETTS SUFFOLK, ss. SUPERIOR COURT. 1584CV00149-BLS2 ____________________ THE GILLETTE COMPANY v. CRAIG PROVOST, JOHN GRIFFIN, WILLIAM TUCKER, DOUGLAS KOHRING, and SHAVELOGIC, INC. ____________________ MEMORANDUM AND ORDER ON CROSS-MOTIONS FOR SUMMARY JUDGMENT The Gillette Company alleges that four former employees helped ShaveLogic, Inc., develop a new disposable cartridge shaving razor using Gillette’s confidential information. Gillette claims that in so doing Defendants violated G.L. c. 93A, the individual defendants breached non-disclosure agreements with Gillette, and all five Defendants engaged in a civil conspiracy. It also claims that ShaveLogic’s patents and patent applications should be subjected to a constructive trust in favor of Gillette. Gillette does not claim that any of the individual defendants breached a covenant not to compete with Gillette. The parties previously stipulated to the dismissal with prejudice of Gillette’s trade secret claims.1 ShaveLogic claims, in turn, that Gillette intentionally interfered with prospective business relations and violated c. 93A, by threatening to bring and then filing baseless legal claims in an attempt to keep ShaveLogic from entering the market for so-called wet-shaving products. The parties have filed cross-motions for summary judgment on all remaining claims and counterclaims. The Court concludes that Defendants are entitled to summary judgment in their favor on Gillette’s remaining claims because Gillette cannot prove that Defendants misused any of Gillette’s confidential information or that the individual defendants breached any non-disclosure agreement. The Court 1 The Court (Salinger, J.) previously ordered the dismissal with prejudice of Gillette’s claims against three other defendants. It dismissed Gillette’s claims that ShaveLogic’s general counsel breached fiduciary duties that he owed as a former Gillette patent counsel and that ShaveLogic’s CEO, its president, and the other individual defendants aided and abetted that alleged breach of fiduciary duty and conspired to bring it about. – 2 – also concludes that Gillette is not entitled to summary judgment on ShaveLogic’s counterclaims because a reasonable fact finder could conclude that Gillette had deliberately brought baseless claims in an attempt to bully ShaveLogic out of the market. The Court will schedule a final pre-trial conference to discuss trial of ShaveLogic’s counterclaims. 1. Gillette’s Claims. Defendants are entitled to summary judgment in their favor on Gillette’s remaining claims because the undisputed material facts show that Gillette has “no reasonable expectation of proving” at least one element of each of its claims. See Boazava v. Safety Ins. Co., 462 Mass. 346, 350 (2012). “A nonmoving party’s failure to establish an essential element of her claim ‘renders all other facts immaterial’ and mandates summary judgment in favor of the moving party.” Roman v. Trustees of Tufts College, 461 Mass. 707, 711 (2012), quoting Kourouvacilis v. General Motors Corp., 410 Mass. 706, 711 (1991). 1.1. Unfair Competition—G.L. c. […]
Wright, et al. v. Balise Motor Sales Company, et al. (Lawyers Weekly No. 12-042-17)
COMMONWEALTH OF MASSACHUSETTS SUFFOLK, ss. SUPERIOR COURT. 1684CV03477-BLS2 ____________________ DEREK WRIGHT and NATHANIEL TOWSE, on behalf of themselves and all others similarly situated v. BALISE MOTOR SALES COMPANY and Others1 ____________________ MEMORANDUM AND ORDER ON DEFENDANTS’ PARTIAL MOTION TO DISMISS AND MOTION FOR A MORE DEFINITE STATEMENT Derek Wright previously sold cars at Balise Hyundai in Hyannis, Massachusetts, for Cape Hy, Inc. Nathaniel Towse sold cars in West Springfield, Massachusetts for Balise Motor Sales Company. Wright and Towse claim that they are owed unpaid overtime, Sunday premium pay, and minimum wages. They assert a variety of statutory claims as well as common law claims for breach of contract and unjust enrichment or quantum meruit. They seek to assert the same claims on behalf of a putative class of similarly situated salespeople. Defendants have moved to dismiss the four common law claims and to compel a more definite statement as to the scope of the putative class. The Court will allow the partial motion to dismiss but deny the motion for a more definite statement. The Court concludes that Defendants are entitled to dismissal of the common law claims because the facts alleged in the complaint do not plausibly suggest that Defendants entered into an implied contract to pay hourly wages of any kind. Instead, the complaint indicates that the parties understood that all salespeople would be paid commissions only. The existence of an implied contract to pay commissions bars Plaintiffs’ claims for unjust enrichment or quantum meruit. 1. Motion to Dismiss. To survive a motion to dismiss under Mass. R. Civ. P. 12(b)(6), a complaint must allege facts that, if true, would “plausibly suggest[] … an entitlement to relief.” Lopez v. Commonwealth, 463 Mass. 696, 701 (2012), quoting Iannacchino v. Ford Motor Co., 451 Mass. 623, 636 (2008), and Bell Atl. Corp. v. Twombly, 550 U.S. 544, 557 (2007). For the purpose of deciding the pending motion 1 Cape Hy, Inc.; James E. Balise, Jr.; William Peffer; Steven M. Mitus; and Allen Thomalla. – 2 – to dismiss, the Court must assume that the factual allegations in the complaint and any reasonable inferences that may be drawn in Plaintiffs’ favor from the facts alleged are true. See Golchin v. Liberty Mut. Ins. Co., 460 Mass. 222, 223 (2011). In so doing, however, it must “look beyond the conclusory allegations in the complaint and focus on whether the factual allegations plausibly suggest an entitlement to relief.” Maling v. Finnegan, Henderson, Farabow, Garrett & Dunner, LLP, 473 Mass. 336, 339 (2015), quoting Curtis v. Herb Chambers I-95, Inc., 458 Mass. 674, 676 (2011). 1.1. Implied Contract Claim. In Count VI, Plaintiffs claim that Defendants breach an implied contract with Plaintiffs by failing […]
Mirra, et al. v. Mirra, et al. (Lawyers Weekly No. 12-044-17)
COMMONWEALTH OF MASSACHUSETTS SUFFOLK, ss. SUPERIOR COURT. 1484CV03857-BLS2 ____________________ LEONARD MIRRA and SANDRA CAPO, individually and derivatively on behalf of MIRRA CO., INC. v. NORINO MIRRA; MIRRA CO., INC.; CHRISTOPHER MIRRA; NATALIE WRIGHT; and ANTHONY MIRRA, JR. ____________________ MEMORANDUM AND ORDER ALLOWING MOTION BY NORINO MIRRA AND MIRRA CO. TO COMPEL PRODUCTION OF DOCUMENTS This lawsuit concerns a dispute among shareholders in a closely-held corporation known as Mirra Co., Inc. Plaintiffs Leonard Mirra (known as Lenny) and his sister Sandra Capo are minority shareholders. Their brother Anthony Mirra, Jr., is also a minority shareholder; he is named as a defendant only because he is a necessary party with respect to Plaintiffs’ claim challenging purported transfers of stock from Norino Mirra to his children Christopher Mirra and Natalie Wright. Defendants Norino Mirra and Mirra Co. have moved to compel production of 44 emails among Lenny, Sandra, their lawyer at Posternak Blankstein & Lund, and Anthony. Defendants argue that these emails are not privileged because they were shared with Anthony, who is not represented by Posternak. Plaintiffs argue that the emails are privileged because Anthony had and still has an implied attorney-client relationship with Posternak. The Court will ALLOW the motion to compel because it concludes, based on Anthony’s sworn deposition testimony, that Anthony never had any kind of attorney-client relationship with Posternak. Absent such a relationship, any privilege in the disputed emails was waived when Plaintiffs voluntarily shared them with Anthony. In re Adoption of Sherry, 435 Mass. 331, 336 (2001). As the party asserting the attorney-client privilege, Plaintiffs have “the burden of establishing that the privilege applies to the communications at issue.” Clair v. Clair, 464 Mass. 205, 215 (2013). “Generally, the attorney-client privilege protects only ‘confidential communications between a client and its attorney undertaken for the purpose of obtaining legal advice.’ ” DaRosa v. City of New Bedford, 471 Mass. – 2 – 446, 463 (2015), quoting Suffolk Constr. Co. v. Division of Capital Asset Mgmt., 449 Mass. 444, 448 (2007). It is undisputed that Anthony never had any express attorney-client relationship with Posternak. In 2010 Lenny, Sandra, and Anthony all met with Attorney Nicholas Nesgos of Posternak to discuss ongoing disputes with the majority shareholders in Mirra Co. (Defendants do not seek disclosure of anything said at that meeting.) Thereafter Lenny and Sandra hired Posternak to represent them. Anthony did not. He never signed an engagement letter with Posternak, never paid Posternak any money, never asked Posternak to represent him, and was never told that Posternak or Attorney Negros was representing him. Plaintiffs insist that Anthony nonetheless had an implied attorney-client relationship with Posternak. In an interesting twist, Anthony does not join in that argument and does not […]
Suffolk Construction Company, Inc. v. Benchmark Mechanical Systems, Inc., et al. (Lawyers Weekly No. 12-045-17)
COMMONWEALTH OF MASSACHUSETTS SUFFOLK, ss. SUPERIOR COURT. 1384CV01463-BLS2 ____________________ SUFFOLK CONSTRUCTION COMPANY, INC. v. BENCHMARK MECHANICAL SYSTEMS, INC. and READING CO-OPERATIVE BANK ____________________ MEMORANDUM AND ORDER ALLOWING PLAINTIFF’S MOTION FOR SUMMARY JUDGMENT This case arises from Suffolk Construction Company’s mistaken payment of monies to Benchmark Mechanical Systems rather than to Benchmark’s lender, Reading Co-Operative Bank. Suffolk had hired Benchmark as a subcontractor on a large construction project. Benchmark secured a line of credit by assigning to the Bank all money that Benchmark stood to collect from Suffolk under its subcontract. Suffolk mistakenly made payments totaling $ 3,822,500.49 to Benchmark instead of to the Bank. Benchmark held and spent those monies, rather than forward them to the Bank. After Benchmark went out of business, the Bank sued Suffolk. The Supreme Judicial Court ordered Suffolk to pay the Bank the full amount it should have paid under Benchmark’s assignment. See Reading Co-Operative Bank v. Suffolk Constr. Co., 464 Mass. 543, 557 (2013). With statutory interest included, Suffolk paid the Bank a judgment totaling $ 7,640,907.45. Suffolk brought this action seeking to recover the surplus held by the Bank that was left after the Bank deducted its reasonable costs of collection and the principal and interest owed by Benchmark from the amount paid by Suffolk. In addition, Suffolk asserted common law claims against Benchmark seeking to recover the $ 3,822,500.49 in subcontract payments that Suffolk was compelled to pay a second time to the Bank. The Supreme Judicial Court recently held that Suffolk had stated viable claims against the Bank, but that its claims against Benchmark are barred by the applicable statute of limitations. See Suffolk Constr. Co. v. Benchmark Mechanical Systems, Inc., 475 Mass. 150 (2016). Suffolk now moves for summary judgment as to its right to collect the surplus of roughly $ 1.35 million being held by the Bank. The Court will ALLOW this motion. – 2 – This resolves all remaining claims. Suffolk and the Bank report that they have settled Suffolk’s claim that the Bank’s costs of collection were unreasonable, and that this settlement will take effect if the Court were to rule (as it does) that Suffolk is entitled to receive the full surplus amount that the Bank owes to Benchmark. The SJC has held that under the circumstances of this case Suffolk is entitled to equitable subrogation as against Benchmark, meaning that it may “stand in Benchmark’s shoes as to the surplus” held by the Bank. Suffolk Constr., 475 Mass. at 156. This holding is the law of the case, is binding on all parties, and may not be reconsidered now that the case has been remanded to the Superior Court. See City Coal Co. of Springfield, […]
CareOne Management, LLC, et al. v. NaviSite, Inc. (Lawyers Weekly No. 12-043-17)
COMMONWEALTH OF MASSACHUSETTS SUFFOLK, ss. SUPERIOR COURT. 1484CV00378-BLS2 1484CV00858-BLS2 ____________________ CAREONE MANAGEMENT, LLC and PARTNERS PHARMACY SERVICES, LLC v. NAVISITE, INC CONSOLIDATED WITH NAVISITE, INC v. CAREONE MANAGEMENT, LLC and PARTNERS PHARMACY SERVICES ____________________ MEMORANDUM AND ORDER ON MOTIONS FOR SUMMARY JUDGMENT These consolidated lawsuits arise from the agreement by NaviSite, Inc., to develop and provide information technology services to CareOne Management, LLC and its affiliate Partners Pharmacy Services, LLC. NaviSite first contracted to provide an array of computerized services to CareOne. Several months later NaviSite contracted to provide a much more limited set of information technology services to Partners. After difficulties and disputes regarding implementation of its contract with CareOne, NaviSite threatened to and then did terminate both contracts. CareOne and Partners asserted various claims against NaviSite, which in turn sued CareOne. (NaviSite also sued Partners, but Judge Sanders dismissed those claims.) NaviSite and CareOne both move for summary judgment; NaviSite does so on all claims while CareOne’s motion is limited to NaviSite’s claims against it. The Court concludes that CareOne is entitled to summary judgment on the claims asserted against it by NaviSite, and that NaviSite is entitled to summary judgment on all claims asserted against it by CareOne and Partners. Final judgment will enter declaring the rights of the parties, with respect to the issues in controversy that CareOne and Partners identified in their claim for declaratory judgment, and dismissing all other claims with prejudice. 1. Background. 1.1. Undisputed Material Facts. The following are undisputed facts, as demonstrated in the evidentiary materials submitted by the parties or reasonable inferences that one could draw from those facts. The Court “must … draw all reasonable inferences” from the evidence presented “in favor of the nonmoving party,” as a jury or judicial fact finder would be free to do at trial. Godfrey v. Globe Newspaper Co., Inc., 457 Mass. 113, 119 (2010). It has done so. CareOne manages dozens of nursing homes. Partners operates commercial pharmacies that serve patients at more than 500 nursing homes, including those run by CareOne. These two companies are separate legal entities, though both were founded and are run by the same person. CareOne retained NaviSite in September 2012 to develop, implement, host, and operate new computing services to be used at all of CareOne’s nursing facilities. The system design was to include “virtual desktops” through which CareOne employees could access programs, applications, and data that NaviSite would host on servers located at its facilities. It also included other computer services that would be implemented and hosted by NaviSite. NaviSite agreed that it would transition CareOne from its current IT vendor and begin providing the agreed upon services using NaviSite’s servers no later than January […]