- Posts by Alison C. CaseyAssociate
Alison C. Casey is an associate in Nutter’s Litigation Department and works with clients primarily on complex intellectual property and commercial litigation as well as labor and employment matters. Clients rely on Alison’s ...
As reported here last summer, Judge Salinger denied lululemon’s motion to dismiss a summary process action brought by lululemon’s landlord, CWB Retail. Later in the litigation, CWB voluntarily dismissed the action with prejudice. lululemon then brought a motion for attorney’s fees under the parties’ lease.
A few weeks ago, the Social Law Library sponsored its annual review of the BLS. Like most events over the past year, the 2020 Year in Review was conducted virtually with Judge Kenneth Salinger and BLS practitioners logging on to discuss significant decisions as well as practice tips and court procedures during these unusual times. While the way the BLS conducts its business changed in 2020, it is evident that the court’s ability to effectively manage complex business and commercial disputes has not. Below are five key takeaways from the 2020 Year in Review program:
In Crashfund LLC v. FaZe Clan, investors in Wanderset Inc. sued successor e-gaming company, FaZe Clan. Wanderset investors claimed that their agreements with Wanderset granted them conditional rights to obtain stock proportionate to their investment upon a “change of control.” The investors also claimed that FaZe Clan refused to issue stock to them after a de facto merger with Wanderset in violation of the agreements. FaZe Clan was sued for, among other things, breach of contract. The investors alleged two theories:
- that the investors’ conditional right to stock in the event of a change of control entitled them to FaZe Clan stock after the de facto merger, or alternatively,
- that FaZe Clan, as the successor entity, was liable for consequential damages caused by Wanderset’s alleged breach of the investor agreements.
It was another eventful year at the BLS, which included Judge Green replacing Judge Kaplan in the BLS1. As 2020 concludes, check out our top five widely read posts:
- Facebook Ordered to Turn Over Internal Investigation Documents to Massachusetts Attorney General: Judge Davis of the BLS ordered Facebook to produce documents to Massachusetts Attorney General Maura Healey (AG). The AG obtained the order while investigating Facebook’s policies and protections related to user data.
- Community Health Systems Affiliate Found Subject to Personal Jurisdiction in Massachusetts: In Steward Health Care System v. CHSPSC, Judge Sanders found that CHSPSC, an affiliate of Community Health Systems (CHS), is subject to personal jurisdiction in Massachusetts for claims made under transition-services agreement (TSAs) signed along with an asset-purchase agreement (APA).
- lululemon’s Motion to Dismiss Eviction Case Denied: In CWB Retail Limited Partnership v. Lululemon USA, Inc., lululemon moved to dismiss a summary-process action brought by its landlord, CWB Retail Limited Partnership.
- Comcast Prevails in Dispute over Interpretation of Commercial Lease: Maynard Industrial Properties Associates Trust (MIPA), a commercial landlord, sued Comcast of Massachusetts III, Inc. (Comcast). The dispute focused on the amount Comcast would owe under an extension of the amended lease.
- John J. Donovan Loses Again: Court Rules that Award in Derivative Action be Distributed Based on Shareholders’ Investment to Avoid Windfall to Disloyal Fiduciary: In Brining v. Donovan, the latest blow to former MIT business professor, John J. Donovan, Judge Davis held that shareholders in Donovan’s failed internet start-up, SendItLater (SIL), could recover more than $700,000 in attorneys’ fees in addition to a December 2019 award of $1.57 million in damages.
In The Travelers Indemnity Company v. Lean & Local LLC, Travelers sought a declaration that it did not owe its insureds indemnity or a defense. Judge Green granted Travelers summary judgment. The claims asserted against the insureds in a trademark case, Judge Green ruled, did not trigger coverage under the policies’ “advertising injury” provision.
The trademark case, filed in the United States District Court for the District of Massachusetts, involved claims by Atomic Café against LeanBox and Cold Brew, the insureds under the policies. Atomic Café alleged that the defendants’ use of Atomic Café’s mark on the defendants’ website constituted trademark infringement.
As we previously blogged, Facebook and Massachusetts Attorney General Maura Healey (AG) are embroiled in a dispute over documents. After Facebook refused to produce certain information created in the course of its “App Developer Investigation,” the AG filed a petition in the BLS to compel Facebook’s compliance with her civil-investigative demand. Facebook opposed the petition, claiming that the sought-after information was work product and protected by the attorney-client privilege. Judge Davis rejected Facebook’s arguments, ordering Facebook to produce documents within 90 days of his order.
After Judge Davis handed down his order, Facebook filed a notice of appeal and moved for a stay pending appeal. The AG opposed the stay. Judge Davis denied the motion.
Judge Davis grounds his denial on two main points.
First, according to Judge Davis, the automatic-stay provision of Mass. R. Civ. P. 62(a) does not apply to the court’s prior order compelling production of documents. That prior order, Judge Davis wrote, “is most appropriately viewed as ‘an interlocutory or final judgment in an action for an injunction,’ which does not qualify for an automatic stay under Rule 62(a).”
Second, Facebook failed to convince Judge Davis that he should exercise his discretion to stay the prior order.
Recognizing that this Judge represents a difficult audience to convince that the [prior order] is erroneous, the Court—viewing the question as objectively as it reasonably can—sees nothing in Facebook’s motion papers which lead it to believe that Facebook’s pending appeal is likely to prevail. The arguments that Facebook intends to pursue on appeal all were considered and rejected by this Court . . . . The Appeals Court may see it otherwise, but this Court remains of the humble opinion that [its prior order] was correctly decided and is likely to be affirmed—rather than overturned—on appeal. For this reason alone, the Court, acting within its discretion, chooses to deny Facebook’s request for a stay of the [prior order].
The Business Litigation Session of the Massachusetts Superior Court
Docket Number: 1984CV02597-BLS1
Case Name: Attorney General v. Facebook, Inc.
Dates of Decision: March 2, 2020
Judge: Brian A. Davis
Judge Davis of the BLS ordered Facebook to produce documents to Massachusetts Attorney General Maura Healey (AG). The AG obtained the order while investigating Facebook’s policies and protections related to user data. The AG’s decision to investigate Facebook was prompted, in part, by media reports about Cambridge Analytica’s misuse of Facebook user information, including private data associated with millions of Facebook users residing in Massachusetts.
In Parker v. EnerNOC, Parker alleged that she was terminated less than one month after closing the most lucrative client contract in EnerNOC’s history in part because she complained about the amount of her commission for the contract. Although Parker prevailed on her Wage Act claim in the BLS, she appealed after the BLS judge did not treble a portion of the commissions she was owed. Parker, as discussed below, prevailed on appeal.
For the second time, sanctions have been ordered against the plaintiff in Tam v. Federal Management Co., Inc., et al.
In 2016, we blogged about Judge Leibensperger’s sanction to disqualify Siew-Mey Tam as a class representative after finding that she made materially false and misleading statements in her affidavit to the court in support of her motion for class certification. These false statements came to light during post-certification discovery, when Tam’s deposition testimony revealed inconsistencies with her affidavit and cast substantial doubt on her credibility. Judge Leibensperger also decertified the class, in part, because of Tam’s inconsistent representations.
In Steward Health Care System v. CHSPSC, Judge Sanders found that CHSPSC, an affiliate of Community Health Systems (CHS), is subject to personal jurisdiction in Massachusetts for claims made under transition-services agreement (TSAs) signed along with an asset-purchase agreement (APA).
Under the APA between Steward Health Care System LLC (Steward) and CHSPSC, Steward agreed to purchase eight hospitals outside Massachusetts. Under the TSAs between the same parties, CHSPSC agreed to provide services to facilitate the transition of the hospitals.
- Senior Editor, Co-Chair, Business Litigation Practice Group