International Brotherhood of Electrical Workers Local No. 129 Benefit Fund v. Tucci, et al. (and eight companion cases) (Lawyers Weekly No. 10-038-17)
NOTICE: All slip opinions and orders are subject to formal revision and are superseded by the advance sheets and bound volumes of the Official Reports.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-12137 International Brotherhood of Electrical Workers LOCAL NO. 129 BENEFIT FUND[1] vs. JOSEPH M. TUCCI & others[2] (and eight consolidated cases[3]). Suffolk. November 7, 2016. – March 6, 2017. Present: Gants, C.J., Botsford, Lenk, Hines, Gaziano, Lowy, & Budd, JJ. Corporation, Stockholder’s derivative suit, Merger, Sale of assets, Valuation of stock, Board of directors. Practice, Civil, Class action, Dismissal. Civil actions commenced in the Superior Court Department on October 15, October 16, October 19, October 20, October 23, October 28, and October 29, 2015. After consolidation, a motion to dismiss was heard by Edward P. Leibensperger, J. The Supreme Judicial Court granted an application for direct appellate review. Jason M. Leviton (Michael G. Capeci, of New York, & Joel A. Fleming also present) for International Brotherhood of Electrical Workers Local No. 129 Benefit Fund & others. Thomas J. Dougherty (Kurt Wm. Hemr also present) for Joseph M. Tucci & others. John Pagliaro & Martin J. Newhouse, for New England Legal Foundation, amicus curiae, submitted a brief. Ian D. Roffman & Matthew J. Connolly, for Associated Industries of Massachusetts, amicus curiae, submitted a brief. BOTSFORD, J. In these consolidated cases, shareholders of a publicly traded corporation claim that a merger transaction proposed by the board of directors will result in the effective sale of the corporation for an inadequate price. The question we consider is whether they may bring that claim directly against the board members, or must bring it as a derivative claim on behalf of the corporation. We answer that the claim must be brought derivatively.[4] Background. The plaintiffs appeal from the dismissal of their first amended class action complaint (complaint)[5] alleging breaches of fiduciary duty by the board of directors of EMC Corporation (EMC) arising from a merger between EMC and Denali Holding Inc. and Dell Inc. (collectively, Dell). At the time that they commenced these actions, the plaintiffs were shareholders of EMC; the proposed merger would result in the shareholders receiving a cash payment in exchange for their EMC stock. The plaintiffs’ complaint alleges that they bring the actions on behalf of a class consisting of “all other shareholders of EMC . . . who are or will be deprived of the opportunity to maximize the value of their shares of EMC […]
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Coghlin Electrical Contractors, Inc. v. Gilbane Building Company, et al. (Lawyers Weekly No. 10-149-15)
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-11778 COGHLIN ELECTRICAL CONTRACTORS, INC. vs. GILBANE BUILDING COMPANY & another;[1] DIVISION OF CAPITAL ASSET MANAGEMENT AND MAINTENANCE, third-party defendant. Worcester. March 2, 2015. – September 2, 2015. Present: Gants, C.J., Spina, Cordy, Botsford, Duffly, Lenk, & Hines, JJ. Contract, Public works, Construction contract, Delivery, Warranty, Indemnity. Warranty. Indemnity. Public Works, Construction management at risk. Civil action commenced in the Superior Court Department on July 17, 2013. A motion to dismiss a third-party complaint was heard by Brian A. Davis, J. The Supreme Judicial Court granted an application for direct appellate review. John W. DiNicola, II (Michael Brangwynne with him) for Gilbane Building Company. James A. Sweeney, Assistant Attorney General, for Division of Capital Asset Management and Maintenance. The following submitted briefs for amici curiae: David J. Hatem, Cheryl A. Waterhouse, & Amanda E. Mathieu for American Council of Engineering Companies of Massachusetts & another. Shannon A. Reilly for Construction Industries of Massachusetts. Joel Lewin, Robert V. Lizza, Jonathan T. Elder, & Robert T. Ferguson, Jr., for Associated General Contractors of Massachusetts, Inc. Hugh J. Gorman, III, & Jeffrey J. Pyle for Columbia Construction Company. GANTS, C.J. This case requires us to resolve three issues regarding a public construction contract that implements the construction management at risk delivery method, pursuant to G. L. c. 149A: (1) Does the owner who furnishes the plans and specifications in a public construction management at risk project give an implied warranty of their sufficiency for the purpose intended, as the owner does under our common law in traditional design-bid-build construction projects? (2) If so, did the parties to the construction management at risk contract in this case disclaim the implied warranty? (3) If they did not, did the indemnification provision in the contract prohibit the construction manager at risk (CMAR) from filing a third-party complaint against the owner in a case brought by a subcontractor seeking reimbursement of additional costs, thus requiring the CMAR to file a separate complaint against the owner to recover the additional costs caused by an insufficient or defective design under the implied warranty? We conclude: (1) under our common law, a public owner of a construction management at risk project gives an implied warranty regarding the designer’s plans and specifications, but the scope of liability arising from that implied […]