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Chambers, et al. v. Gold Medal Bakery, Inc., et al. (Lawyers Weekly No. 10-020-13)

NOTICE:  All slip opinions and orders are subject to formal revision and are superseded by the advance sheets and bound volumes of the Official Reports.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‑11231   MICHELE LeCOMTE CHAMBERS[1] & others[2]  vs.  GOLD MEDAL BAKERY, INC. & others.[3]     Bristol.     October 4, 2012.  ‑  February 8, 2013. Present:  Ireland, C.J., Spina, Cordy, Botsford, Gants, Duffly, & Lenk, JJ.       Corporation, Board of directors, Close corporation, Derivative action, Officers and agents, Stockholder.  Privileged Communication.  Evidence, Privileged communication, Privileged record.  Practice, Civil, Subpoena.  Subpoena.  Fiduciary.  Attorney at Law, Attorney‑client relationship, Communication with represented party, Work product.       Civil action commenced in the Superior Court Department on April 3, 2009.     A motion for a protective order was heard by Frances A. McIntyre, J.   The Supreme Judicial Court granted an application for direct appellate review.     John N. Love (Anthony A. Froio with him) for the defendants. Howard M. Cooper (Heidi A. Nadel & Kimberly E. Dean with him) for the plaintiffs.     SPINA, J.  The issue presented in this appeal is whether a closely-held corporation and its corporate counsel and accountants can assert attorney-client privilege or work product protection against directors-shareholders asserting claims against the corporation and its directors.  Because there is sufficient evidence that the plaintiffs’ interests are adverse to the interests of the corporation as concerns the 2007 and present litigations, we conclude that the plaintiffs are not entitled to privileged or protected information relating to the two litigations. Background and procedure.  We recount the facts in particular detail because of their significance to the disposition of this case.  The story leading to the present appeal begins with two brothers who were in the bakery business together.  The brothers each owned fifty per cent of two closely-held companies (collectively, Gold Medal), which have grown into major suppliers of wholesale bakery products in New England. The individual parties to the present action are split along family lines, with each side of the litigation representing the legacy of one of the brothers.  On one side are Georgette LeComte and Michele LeComte Chambers, respectively widow and daughter of one of the brothers, who together own fifty per cent of Gold Medal stock.  Both joined Gold Medal’s four-seat board of directors in 2008, assuming two of the four, or fifty per cent, of the seats.  Georgette since has been replaced as director by her designee, Michael Kehoe.  These three individuals are the plaintiffs. On the other side of the […]

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Posted by Massachusetts Legal Resources - February 9, 2013 at 1:13 pm

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