Boston Business Litigation Blog

Massachusetts District Court Applies Precondition Test to Determine That Employees Are Not Entitled to Overtime Pay for Employee-Required Training

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In a recent Memorandum and Order, the United States District Court for the District of Massachusetts District Court granted summary judgment to a group of defendant banks after applying a "precondition" test established by the First Circuit regarding overtime pay to employees for their participation in required training programs. The case, Miller et al v. Citizens' Financial Group et al., stemmed from the plaintiff employees' claims that the banks had failed to pay them overtime compensation for time spent outside of regular working hours to study for mandatory licensing exams, and that this failure constituted a violation of both the Fair Labor Standards Act and Massachusetts and Pennsylvania state law. The District Court analyzed the summary judgment motion under controlling First Circuit precedent as established in Ballou v. General Electric Co. and Bienkowski v. Northeastern University. In both cases, the plaintiffs claimed that they were not compensated for time spent on mandatory classwork and/or training in connection with their employment and, in both cases, the First Circuit upheld summary judgment rulings against the plaintiffs. 

First Circuit Rules That Massachusetts State Wage Act Not Preempted by Federal Law

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In the recent case of Capron v. Office of Attorney Gen. of Mass., the federal First Circuit Court of Appeals issued an interesting ruling regarding the intersection of federal and state law, affirming a U.S. District Court order of dismissal providing that state wage and hour laws fully applied to foreign nationals employed as "au pairs" in Massachusetts on special visa programs promulgated by the U.S. State Department. 

Why Are Mediation and Conciliation Confidential?

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Mediation and conciliation are two of the most common methods of alternative dispute resolution ("ADR"). In each of these voluntary processes, a third party neutral with no stake in the case tries to facilitate a compromise or agreement between parties who are in dispute. The mediator, or conciliator, will spend time with the parties and work with them, and their counsel, to assess each of their goals and help them move towards an agreement that is fair and reasonable and something each of the parties can live with. 

United States Supreme Court Rejects Discovery Rule for Fair Debt Collection Practices Act, But Leaves Potential Fraud-Specific Discovery Rule for Another Day

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The United States Supreme Court has agreed with the United States Court of Appeals for the Third Circuit, and resolved a circuit split with the Fourth and Ninth Circuits, holding that the Fair Debt Collection Practices Act, 15 U.S.C. §§ 1692, et seq. ("FDCPA") does not incorporate the discovery rule into its statute of limitations. Rotkiske v. Klemm, et al. 

Merlini v. Canada: The "Commercial Activity" Exception to the Foreign Sovereign Immunities Act

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In Merlini v. Canada, the First Circuit dealt with an interesting case involving a clerical employee of the Canadian embassy who was injured on the job. After numerous twists and turns in her attempt to get worker's compensation coverage for her injury, she ultimately sued the country of Canada, asserting that because it did not have worker's compensation coverage under Massachusetts law, she could recover from it directly. Canada argued that it was immune from suit under the Foreign Sovereign Immunities Act ("FSIA"). 

What happens when a buyer and a seller of a property negotiate past the purchase and sale deadline?

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The Massachusetts Appeals Court recently issued an opinion in Ferguson v. Maxim, finding that the parties' offer agreement to purchase a property was enforceable even though the parties failed to timely execute the purchase and sale agreement (which, Defendants had argued, was a term of the offer), and the deadline to execute the purchase and sale agreement could be waived by the parties.

In Ferguson, the Plaintiff alleged that he and the Defendants had a binding agreement for the sale of the Defendants' property in Leominster. The parties executed a "Contract to Purchase Real Estate," which self-identified as a "Binding Contract" and identified the property, the purchase price and deposit terms, and the time and place of closing, and set a deadline by which the parties were to execute a purchase and sale agreement (P&S).

Through counsel, the parties began to negotiate the terms of the P&S but the first draft of the P&S was not circulated until after the deadline to execute the P&S had passed, and negotiations continued thereafter. At different times, counsel for both parties suggested extending the P&S deadline, but the record did not indicate that any extensions were ever granted or denied. At one point, counsel for the Defendants' attempted to cease negotiations on the grounds that the P&S deadline had passed, before later reviving negotiations for another week, and then once again terminating negotiations. Shortly thereafter, the Defendants sold the property to a third party.

First Circuit Holds Bank's Sustained Overdraft Fees Are Not Interest Under the National Bank Act

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The First Circuit recently affirmed the dismissal of a case in which the plaintiff alleged that Citizens Bank's "Sustained Overdraft Fees" on overdrawn checking accounts were usurious interest charges in violation of Section 85 of the National Bank Act (the "NBA"). Fawcett v. Citizens Bank, N.A. 

Is a Court Required to Consider Past Abuse in a Child Custody Modification Action?

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Recently in Malachi M. v. Quintina Q., the SJC held that:

[P]ursuant to G.L. c. 208, § 31A, the judge at a modification proceeding must consider evidence of both past and present abuse, including evidence of domestic abuse that occurred prior to the entry of the divorce judgment, and must address the applicability of the rebuttable presumption, even in the absence of evidence of abuse occurring after the divorce judgment.

U.S. Court Denies Motion to Stay in $118 Million-Dollar Venezuelan Debt Case

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The United States District Court for the Southern District of New York has denied a motion brought by Venezuelan state-owned oil company, Petróleos De Venezuela, S.A. ("PDVSA"), and PDVSA Petróleo, S.A. ("Petróleo") (together, "Defendants"), for an additional 120-day stay of the litigation in Red Tree Investments, LLC v. Petróleos De Venezuela, S.A. and PDVSA Petróleo, S.A.

The Insider Trading Landscape Changes Under Blaszczak

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The U.S. Court of Appeals for the Second Circuit's decision in U.S. v. Blaszczak may have just changed the landscape for insider trading prosecutions. In order to prove an insider trading charge under the Securities Exchange Act of 1934 (the "Exchange Act"), the government has to prove that an insider received some "personal benefit" from exchanging material, non-public information. This requirement comes from the 1983 U.S Supreme Court ruling in Dirks v. SEC

Third Circuit Confirms that TILA Recoupment or Set Off Claims Outside the Statute of Limitations Can Only Be Asserted Defensively

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The United States Court of Appeals for the Third Circuit has reaffirmed that exceptions to the statute of limitations for asserting certain claims regarding allegedly deceptive loan practices found in the Truth in Lending Act ("TILA"), apply only to assertion of those claims defensively, and not as an affirmative claim against a lender, in Gochin v. Markowitz.

A Court May Modify A Merged Provision in a Separation Agreement Regarding Children's Expenses Only When There Has Been A Material Change in Circumstances

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Divorce litigants in Massachusetts may not clearly understand the distinction between those provisions in a Separation Agreement regarding child support and those provisions regarding the payment of the child(ren)'s expenses. Both types of provisions are merged into the Judgment of Divorce, meaning that the court can modify them in appropriate cases. Generally speaking, the standard for modifying a child support order is that there must be "an inconsistency between the amount of the existing order and the amount that would result from the application of the Massachusetts child support guidelines." M. G. L. c. 208, § 28. In contrast, the standard for modifying any provisions about payment of a child's expenses is that there must have been a "material change in circumstances" since the entry of the judgment that is being modified. 

Tracking Down Documents For Legal Proceedings Abroad: Recent Decisions Broadening The Scope of Section 1782

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Section 1782 of the U.S. Code (28 U.S.C.§ 1782) is a very important discovery tool for litigants who are part of a legal proceeding outside the U.S. (particularly if access to discovery is restricted there). It allows a foreign litigant to make a request before a federal court to obtain evidence from a person within the district for "use in a foreign or international tribunal." 

First Circuit Holds that Employee's Termination Not Violative of Implied Covenant of Good Faith and Fair Dealing

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In the recent case of Suzuki v. Abiomed, Inc., the First Circuit Court of Appeals affirmed a U.S. District Court order granting summary judgment to the defendant employer, holding that the company's termination of an employee approximately fifteen months prior to the achievement of an important milestone, which would have entitled the employee to a large equity grant, did not violate the implied covenant of good faith and fair dealing in his employment contract. 

What happens if one spouse builds a house and the other spouse does not help?

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In a recent 1:28 decision, the Appeals Court of Massachusetts considered a challenge to a judge's order that real estate acquired by the Husband prior to the marriage should remain with the Husband following the divorce.

Arbitrating Against Chinese Companies: Recent Developments from the HKIAC

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When foreign companies do business with Chinese companies, international arbitration can be a key tool for dispute resolution, as it avoids either having a foreign court judgment that is unenforceable in China or having to deal with Chinese courts and home-court advantage for the Chinese company. Chinese courts have a good track record of enforcing international arbitral awards under the New York Convention. 

Protections Afforded to Homeowners by the Massachusetts Homestead Act

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The Massachusetts Homestead Act allows homeowners to shield up to $500,000 of equity in their principal place of residence from claims from unsecured creditors (i.e. credit card debt).

Appeals Court Holds that No Easement by Necessity Created in Condominium Dispute

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Earlier this year, the Massachusetts Appeals Court issued an important decision in Chamberlain v. Badaoui reversing a Superior Court judgment and holding that a condominium's master deed did not create an express easement granting to Plaintiffs' unit access through the neighboring Defendant's unit to the fire escape stairs. The Court further held that the Plaintiffs had failed to establish an easement by necessity.

Unsuccessful Challenge to FINRA Arbitration Shows Durability of Arbitral Awards

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The Massachusetts Arbitration Act ("MAA") provides for judicial review and vacation of arbitration awards, under the specific and limited circumstances enumerated at G.L. c. 251, § 12. These limitations acknowledge the public policy goals that encourage private, binding arbitration of disputes in general. "Absent fraud," the Massachusetts Supreme Judicial Court has held, "errors of law or fact are not sufficient grounds to set aside an award... An arbitrator's result may be wrong; it may appear unsupported; it may appear poorly reasoned; it may appear foolish. Yet, it may not be subject to court interference." Lynn v. Thompson.

In Breach of Contract Claim, Courts May Award Both Damages and Specific Performance

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In Motsis v. Ming's Supermarket, Inc., (Mass. App. Ct. Nov. 5, 2019), the Appeals Court affirms a judgment awarding a commercial tenant both monetary relief and specific performance.

Conclusory Allegations, Even When Admitted by the Opposing Party, Deemed Insufficient to Defeat Summary Judgment in FLSA Dispute

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Recently in Costello v. Molari, Inc. (Memo and Order, November 20, 2019), the United States District Court for the District of Massachusetts granted an employer summary judgment because the employee failed to show that the Fair Labor Standards Act ("FLSA") applied to the employer. The employee did not identify evidence that would create a dispute of material fact as to whether the employer was engaged in interstate commerce. 

CFPB Now Claims Its Structure Is Unconstitutional

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A few short months ago, I wrote a blog post about the Consumer Financial Protection Bureau surviving an attack on its constitutionality in the United States Court of Appeals for the Ninth Circuit. In that case, the plaintiff alleged that the CFPB's structure was unconstitutional because it had a single director who did not serve at the pleasure of the President. The CFPB argued that its structure was, in fact, constitutional, and it won the argument. The plaintiff sought to have the case heard by the U.S. Supreme Court. 

New Appeals Court Decision Clarifies Residency Requirement For Filing For Divorce

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In Massachusetts, the durational residency requirement for a plaintiff to file for divorce is one year G.L. c. 208, § 5 (meaning, one must be a Massachusetts resident for a year before Massachusetts has jurisdiction over their divorce), but until recently, appellate courts had yet to define the parameters of that one-year residency requirement. Earlier this month, the Massachusetts Appeals Court provided clarification in its decision in Rose v. Rose.

On What Grounds Can an International Arbitration Award Be Vacated?

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Your U.S. company and a commercial partner from a foreign nation had the foresight to designate international arbitration as the dispute resolution mechanism in your joint venture agreement. A dispute arose and you both diligently presented your claims to the arbitral panel. The arbitral panel has issued its award. What now?

Lost opportunity for considering alimony after child support is established: Appeals Court decision leaves us in the dark

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In Casey v. Sweeney, a recent decision of the Appeals Court of Massachusetts, the court declined to provide clarification on the meaning of a statutory provision that has puzzled commentators and practitioners since it came into effect on March 1st 2012. The provision at issue is M.G.L. c 208 s 53(c)(2), which reads:

What is dissipation of the marital estate and why does it matter?

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One of the most contentious issues arising in divorce proceedings will often be the division of the parties' assets. In Massachusetts, the courts follow an equitable system of division, meaning they seek to divide property "fairly," not necessarily "equally." There are cases in which the marital estate seems to have been reduced by the irresponsible or intentional conduct of one party (party A), which ostensibly has the result of diminishing the eventual share of the marital estate that each party will retain.

When will the court order a party to pay the other's attorney's fees in a family law case?

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In civil litigation, which includes cases in the Probate and Family Courts, the American rule generally dictates that each party is responsible for its own attorney's fees and expenses. However, there are some exceptions to this, and in Massachusetts some 'fee-shifting' statutes provide for one party to cover the other's legal costs, particularly in domestic relations or family proceedings.

Massachusetts Superior Court Concludes Lender Properly Foreclosed and Seized Borrower's Personal Property Following Loan Default

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A recent Massachusetts Superior Court case, Germinara v. Bakis, et al. (decided May 13, 2019), involved a plaintiff borrower who obtained a commercial loan in order to fund the purchase and operation of a gas station/convenience store, which was owned by an LLC formed by the plaintiff. The loan was secured by both the gas station property and contents and a second property that was owned by the borrower in trust. Further, the lender and the funder of the loan were granted mortgages and deeds-in-lieu of foreclosure to secure the interest on both properties owned by the borrower. When the plaintiff defaulted on the loan, the lender and the funder took title to the two properties by exercising the deeds-in-lieu of foreclosure. They sold both properties and, additionally, seized some items of the borrower's personal property that had been located at the properties, such as trucks and vehicles. Some of these items were owned by the plaintiff in his individual capacity, and not by the LLC that held title to the gas station; however, the lender held other security obligations which included the vehicles.

A Disloyal Corporate Officer, Ordered to Forfeit His Compensation To His Employer, Fails in His Attempt to Reduce The Amount of Restitution Under the Joint Tortfeasors Act

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In a case of first impression, the Business Litigation Session (Davis, J.) recently declined to reduce the amount of restitution a disloyal corporate officer had been ordered to pay to his employer in connection with a judgment against the corporate officer. In so holding, the court held that a settlement payment, received by the plaintiff employer from two co-defendants (the former employee and a competitor business), did not fall within the scope of the Joint Tortfeasors Act and, therefore, the Act could not be applied to offset any damages the former corporate officer was ordered to pay. See Element Productions, Inc. v. Editbar, LLC et al. (Suffolk Sup.Ct.).

Banking and Finance Use of International Arbitration Continues to Grow

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International arbitration has many benefits for banking and finance disputes, and parties to those disputes are increasingly recognizing those advantages. While banks and financial institutions have traditionally used courts and other judicial forums to resolve disputes, including international disputes, increasing numbers of cases are being litigated and resolved through international arbitration.

Can Student Loan Debt be Categorized as a Marital Debt?

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In Massachusetts, a judge has broad discretion with respect to the equitable division of the marital estate and may consider both economic and noneconomic contributions to the marital estate. A prenuptial agreement can clarify the responsibility for debts incurred during the marriage, as well as how payments made toward individual, pre-marital debts during a marriage, including student loans, are to be treated in the event of a divorce. Generally speaking, debt incurred during the marriage, including student loan debt, will be presumptively marital. The party challenging that presumption will typically have to present evidence that the debt at issue was intended to be an individual debt. The analysis is entirely dependent on the circumstances of the case and the determining factor will not rest on whether the challenging party's signature is on the underlying promissory note securing the original debt. In a vacuum, student loan debt incurred by one party prior to the marriage will typically be categorized as individual debt, especially in marriages of a shorter duration. However, the issue becomes more complicated where one spouse significantly pays down the other's pre-marital student loan debt. While the Court may certainly look to the intent of the parties at the time of the incurrence of the debt - in highly contested matters - evidence to that effect may be limited to the now at-odds testimony of the parties.

When Income Attribution is Appropriate

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In a recent case, Macri v. Macri, the Massachusetts Appeals Court recently cemented a trial court decision to, among other things, attribute income to Husband, who was unemployed at the time of trial. Attribution of income is often a contested topic in the Probate and Family Courts of Massachusetts, and this case provides further guidance on the issue.

Is the Non-Compete Clause in My Employment Contract Enforceable?

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Perhaps you are considering finding employment at a new company or already have a new job offer and remember that the employment agreement you have with your current or recent employer includes a non-compete clause. What is a non-compete agreement? Does this mean you cannot take the new job? Is the non-compete clause enforceable?

Alimony modification requires a showing of a material change in circumstances

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In a recent summary decision, Casey v. Sweeney, a panel of the Massachusetts Appeals Court reaffirmed that a payor's alimony obligation determined prior to the enactment of the Alimony Reform Act in March 2012 cannot be modified without a showing of a material change in circumstances (i.e., a material change affecting either the recipient's need or the payor's ability to pay.

The Singapore Mediation Convention & Its Impact on Enforcement of International Mediation Agreements

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The New York Convention has made it much easier for parties in international arbitration to seek enforcement of arbitral awards. The United Nations Convention on International Settlement Agreements Resulting from Mediation, also known as the Singapore Mediation Convention, is poised to do the same for settlement agreements arising out of international mediation.

Declaratory Judgment Is Necessary Where Guaranty Does Not Address Certain Uses of Proceeds from a Foreclosure Sale.

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In most commercial lending transactions, it is a common practice for lenders to secure the loan with a mortgage on the business property, which would permit the lender to foreclose on the mortgage securing the property if the borrower were to default on the. For closely held businesses, many lenders also require the business owners to secure the loan with a personal guaranty. A guaranty is an agreement made by a third party to secure the debt of a borrower to a lender in the event that the borrower defaults on the loan.

Zoning and the Dover Amendment: When is education the primary purpose of a residential facility?

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In a recent decision, The McLean Hospital Corporation v. Town of Lincoln & Others, the Massachusetts Supreme Judicial Court (SJC) held that a proposed residential program for adolescents is exempt from local zoning laws under the Dover Amendment.

Is a Former Spouse a "Creditor" Under the Massachusetts Uniform Fraudulent Transfer Act?

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In Foisie v. Worcester Polytechnic, Institute (September 30, 2019), the United States District Court for the District of Massachusetts allowed a Motion to Dismiss where a former wife brought claims of fraudulent transfer and/or constructive fraudulent transfer against Worcester Polytechnic Institute ("WPI") located in Massachusetts under Connecticut law. The former wife alleged that the assets donated to WPI by her former husband were hidden from her during their divorce, and that the donation was intended to defraud her.

Seeking US Discovery for Foreign Proceedings: The Second Circuit Opens US Style Discovery to the World

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Earlier this month, the Second Circuit issued a decision in In re Application of Antonio Del Valle that significantly expands the ability of parties to foreign legal proceedings to obtain discovery through United States courts. In Antonio Del Valle, the Second Circuit reached two key conclusions that work to expand the reach of discovery by U.S. courts under 28 U.S.C. § 1782. 

What Happens if the House is Sold During the Divorce?

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It is the unfortunate case that, in many divorces, the marital home is sold as part of the divorce proceedings. Sometimes, the decision is made for non-financial issues - the house is tied to too many memories and both parties decide that they are better off starting anew. More often than not, however, the financial circumstances are such that the house is simply unaffordable. Perhaps the party who wants to stay will no longer be able to afford the carrying costs; an unfortunate corollary of most divorces is that oftentimes one income or even two are insufficient to maintain two different households. Whatever the reason, often by agreement and sometimes by court order, the marital home is just ordered to be sold either during or after the divorce.

Supreme Court Holds That Federal Arbitration Act Permits Litigation of Disputes By Workers Bound by Independent Contractor Agreements

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The United States Supreme Court held in the unanimous decision of New Prime Inc. v. Oliveira earlier this year that the Federal Arbitration Act's exclusion as to contracts of employment necessitated that the parties' arbitration clause be overridden and the plaintiff be allowed to pursue his lawsuit in the Massachusetts federal courts.

Viable Retaliation Claim For An Employee Terminated Several Months After He Complained About Discrimination By His Supervisor

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In a recent unpublished decision, Bakhtiar v. Infineon Technologies Americas Corp.the Superior Court in Worcester County (Yarashus, J.) found that an employee could establish a prima facie case of retaliation under Massachusetts law (G.L.c. 151B, § 1) even though eight months passed between his complaint of discriminatory treatment by his supervisor and his termination.

Gimmick Check Not Accord and Satisfaction Under UCC Section 3-311

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The United States District Court for the Eastern District of Virginia has held that, where a debtor in bad faith tenders a check or money order for substantially less than the amount owed on a loan, the receipt and deposit of that check will not constitute an "accord and satisfaction" under the Uniform Commercial Code ("UCC"), Section 3-311. Miffin v. Selene Finance LP.

What "Counts" as Income for the Purposes of a Child Support Order?

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In Massachusetts, the amount of weekly child support to be paid by a parent is calculated by relying on the Massachusetts Child Support Guidelines, which are published by the Executive Office of the Massachusetts Trial Court and updated every three years. Although it is a simple proposition to say that child support orders are largely based on the parents' respective incomes, it is important to understand what is included as "income" by the Probate and Family Court in determining a child support obligation.  The Guidelines themselves take the broadest possible approach to defining income, stating that "income is defined as gross income from whatever source, regardless of whether that income is recognized by the Internal Revenue Code or reported to the Internal Revenue Service or state Department of Revenue or other taxing authority."  The Guidelines go on to list 29 different types of income which are presumptively included in a parent's income for child support purposes, including, among other items, salaries, wages, overtime, tips, commissions, severance pay, royalties, interest and dividends, bonuses, certain government benefits, workers' compensation, distributions from trusts, pension and annuity income, capital gains, lottery or gambling winnings, prizes and awards, and rental income.

Bankruptcy Sale of Beneficiary's Interest in Nominee Trust Sufficient to Trigger Tenant's Right of First Refusal

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"A nominee trust is 'an entity created for the purpose of holding legal title to property.'" Goodwill Enterprises, Inc. v. Kavanagh. Record title for the property held in a nominee trust is in the name of the nominee trust's trustee (not its beneficiaries), but such trustees "are often viewed as agents for the convenience of the principals (i.e., the beneficiaries)." Id. But what is the nature of a beneficial interest in a nominee trust? Is it more like an ownership share of a corporation or does it constitute a real property interest in the property held by the nominee trust?

Are Employees Paid Solely by Way of Commissions Entitled to Separate Payments for Overtime Work or Work on Sundays Under the Massachusetts Overtime and Sunday Wage Statutes?

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In Sullivan v. Sleepy's LLC, the Massachusetts Supreme Judicial Court (SJC) answered this question in the affirmative. In Sullivan, the SJC considered whether an employer satisfied its obligations to its employees under Massachusetts Overtime and Sunday wage laws, where its employees' wages were comprised entirely of commission (or draws against commission), if their total weekly income met or exceeded one and a half times their regular hourly rate or at least one and a half times the minimum wage for each hour they worked over forty. The Court concluded that those employees were entitled to a separate payment - in addition to their draws or commissions - of one and a half times their regular rate or at least one and a half times minimum wage for every hour they worked over forty. With regard to Sunday pay, the SJC affirmed that a plain reading of that statute requires a separate and distinct time and a half payment for hours worked on a Sunday pay even when an employee received commission payments in the first instance that equaled or exceeded what the employee would be entitled to per the Sunday pay statute.

Supreme Judicial Court signals that it may become more difficult for primary custodial parents to move children out of the Commonwealth

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In Massachusetts, petitions for the removal or relocation of a child from the Commonwealth are evaluated under one of two legal analyses, depending on whether one parent has sole/primary custody or the parents share physical custody. Where one parent has primary physical custody of the child(ren) a judge will determine whether there is cause shown to permit relocation by applying the "real advantage" analysis first set forth in the case of Yannas v. Frondistou-Yannas.The interests of the custodial parent weigh heavily in the real advantage test, as a custodial parent will be permitted to relocate if the move offers a genuine, recognizable advantage to that parent and is consistent with the child's best interests.

Arbitrating Technology Transfer Disputes

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Technology transfer is a critical way for innovation companies to enter into new markets and profit from the hard work that they have done in developing new technology. These agreements can take many forms, from an assignment of the intellectual property rights to a licensing agreement, to a joint venture. And unlike the sale of physical assets, with the sale or licensing of IP, there are numerous complicated issues involving exactly what is being transferred, adaptations or further development of the technology, and competition between the technology owner and the transferee.

During the heady moments when reaching a deal, everyone always seems on the same page. But months or years down the road, disputes can often arise, particularly where there are substantial royalty payments in the balance.

Federal National Mortgage Association Cannot Be Held Vicariously Liable for Acts of Agent Without Actual Authority

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The United States Court of Appeals for the First Circuit has held, in a matter of first impression, that the Federal National Mortgage Association, commonly known as Fannie Mae, cannot be held vicariously liable for the acts of its agent absent actual authority from Fannie Mae for the agent's actions. Faiella v. Federal National Mortgage Association.

Taking the Fifth: No Longer an Option When it Comes to Adultery in Massachusetts

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Pursuant to 2018 Session Laws Chapter 155, Section 2 (An Act Relative to Reproductive Health), Massachusetts's outdated law criminalizing adultery was repealed. The Governor approved the law on July 27, 2018.

2018 Session Laws Chapter 155, Section 2 specifically repealed Massachusetts General Laws Chapter 272, Section 14 (Adultery), which read:

Summer Internship Reflection: The Psychology of Law

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By Alina C. Hachigian

This summer I had the opportunity to intern with Fitch Law Partners. In addition to assisting attorneys with research and deposition preparations, over the course of the summer I was able to experience law outside the office as well. I traveled to different courts around the city and sat in on various matters ranging from criminal to family law. With each visit I began to better understand the in-court portion of litigation and the amount of intricacies that must come together within the courtroom in order to win a case. Exposure to this aspect of litigation provided me a more detailed view of the process as a whole and I found myself becoming more critical of the system itself. I questioned the purpose and effect of each dynamic I discovered in the courtroom and how such aspects affect different individuals. Overall, these experiences gave me a more nuanced view of litigation and allowed me to better consider how this type of work plays out within the framework of our society today.  

Is the knowledge of a closing attorney imputed to the mortgage company?

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This issue arose in the recent Massachusetts Appellate case Salem Five Mortgage Company, LLC v. Lester. In that case, a mortgage company lent a borrower $300,000 for the purchase of a home on Nantucket. After the mortgage company approved the loan, but before the closing date, the borrower requested that his wife be added to the deed as a tenant by the entirety. However, the wife's name was not added to the mortgage, which remained solely in the name of the borrower. As a result, the mortgage company received a security interest only in the borrower's undivided interest in the property. The closing attorney, who represented both the mortgage company and the borrower, was aware of way in which the title was worded and told the seller of the property that the borrower and his wife would take title as tenants by the entirety. The mortgage eventually went into default, at which time the mortgage company discovered the mistake and sued for reformation of either the deed or the mortgage.

The New Judgments Convention

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One of the main reasons that we at FITCH recommend that the vast majority of cross-border contracts contain international arbitration clauses is because of the New York Convention. More formally called the Convention on the Recognition and Enforcement of Foreign Arbitral Awards, the New York Convention was ratified in 1959 and currently has 159 parties. It requires states to honor and enforce arbitral awards issued in any of the other member states, and means that by selecting international arbitration as the dispute resolution mechanism, parties can get their awards enforced virtually anywhere on the planet.

What Happens at a Pre-Trial Hearing?

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If a divorce or 209C case is pending, the court, sooner or later, will schedule what is known as a pre-trial hearing. Sometimes this is also referred to as a pre-trial conference. This will happen either on the court's own initiative once a complaint has been on file long enough, or following a case management conference. At a case management conference, the parties and judge will address a timeline for the case - the appropriate timeline for a discovery deadline and a pre-trial hearing, among other matters. The parties can, by stipulation, avoid appearing at a pre-trial hearing by submitting a written agreement that specifies the specific dates for the case timeline.

When is Joint Legal Custody Inappropriate?

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Massachusetts courts recognize two distinct types of custody of children. The first, physical custody, is what most litigants mean when they refer to having "joint custody" or "primary custody" of their child. Physical custody is a term that describes the amount of time the child spends in the care of each parent. Although physical custody is often the aspect of divorce or custody litigation that is most contentious, the second type of custody - legal custody - is also a fundamental element of parental authority. Legal custody refers to the parents' rights to make "major decisions regarding the child's welfare including matters of education, medical care and emotional, moral and religious development." M. G. L. c. 208, § 31. Legal custody can be either joint, in which the parties must confer with each other and reach shared decisions on these types of matters, or sole, in which one parent has the ability to make decisions about the child's health, education, or religion, even if the other parent disagrees. Joint legal custody, at a minimum, requires "two capable parents with some degree of respect for one another's abilities as parents, together with a willingness and ability to work together to reach results on major decisions in a manner similar to the way married couples make decisions." Rolde v. Rolde

First Circuit Finds That A Notice Of Default Is Potentially Deceptive, Rendering The Foreclosure Invalid

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In Thompson v. JPMorgan Chase Bank (1st Cir. 2019), the First Circuit reversed the District Court's dismissal of the borrowers' claims against the mortgagee, finding that the notice of default did not strictly comply with the terms of the mortgage and Massachusetts law. 

Supreme Court Rules that Double Jeopardy Does Not Prevent State and Federal Prosecutions

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The Double Jeopardy Clause of the Fifth Amendment provides that "No person shall...be subject for the same offence to be twice put in jeopardy of life or limb." That clause means that no person can be prosecuted twice for the same crime. Historically, the Double Jeopardy Clause had not been held to bar separate sovereign governments from trying an individual for the same crime, a doctrine known as the separate-sovereigns doctrine. Because the federal and state governments are separate sovereignties, the Double Jeopardy Clause had historically been held not to prohibit the Federal government from prosecuting an individual for an offense for which that individual had already been tried in state court.

Practical Considerations on Electronic Disclosures in International Arbitration

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Electronically stored information ("ESI") has connected businesses in ways that were not previously possible. ESI has also become a major source of evidence in all forms of commercial disputes. Arbitration generally limits discovery in order to promote its underlying goal as a cost-effective alternative to litigation. Nonetheless, parties often request documents from each other in disputes and the prevalence of ESI makes it inevitable that these documents will continue to impact the nature of international arbitrations. 

To Be or Not to Be . . . a Debt Collector

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In Obduskey v. McCarthy & Holthus L.L.P., the Supreme Court examined whether an entity engaged in the limited purpose of enforcing a security interest in a nonjudicial foreclosure proceeding fit the definition a "debt collector," thereby subjecting it to all of the provisions of the Fair Debt Collectors Practices Act ("FDCPA"). The Supreme Court unanimously ruled that the Respondent, McCarthy & Holthus LLP ("McCarthy"), hired by Wells Fargo to enforce its security interest by acting as its agent to foreclose on a defaulting, Colorado debtor's home, in that narrow instance, was not a "debt collector" within the meaning under the FDCPA, except with regard to the confines of §1692f(6). In order to reach its decision, the Court partitioned the FDCPA's definition of a "debt collector" into two parts: (1) a 'primary' debt collector defined as "any person . . . in any business the principal purpose of which is the collection of any debt, or who regularly collects or attempts to collect, directly or in-directly, debts[;]" and (2) for the purposes of §1692f(6) of the FDCPA, a 'limited-purpose' debt collector defined as also including "any person . . . in any business the principal purpose of which is the enforcement of security interests."

Uncontested Actions To Modify A Judgment Or Order By Agreement: Supplemental Probate And Family Court Rule 412

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Since its amendment in 2013, Supplemental Probate and Family Court Rule 412 has provided litigants/parties with the ability to jointly request that the Court modify an existing judgment or order administratively and without the need for a formal hearing. While such administrative modifications can cover a myriad of provisions, including child support, actions pending under M.G.L. 209A (abuse prevention orders) are specifically excluded from the modification procedures set forth in Rule 412.

Are trust interests part of the marital estate?

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The inclusion - or non-inclusion - of beneficial trust interests in the marital estate for purposes of an asset division incident to a divorce is quite often a hotly contested issue. How does one account for a trust interest in a divorce? Did the trustee make any distributions during the marriage? Is the trust terminating anytime soon? If so, for what reason? And if it terminates, what happens to the principal? Is it - or its potential future acquisition - considered property?

United States District Courts Reach Differing Conclusions on Definition of Automated Telephone Dialing System

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The United States District Courts for the District of Massachusetts and the Northern District of Illinois recently reached different conclusions on the definition of an Automated Telephone Dialing System ("ADTS"), reinforcing a split of authority among courts across the country on the definition of such a system under the Telephone Consumer Protection Act ("TCPA), 47 U.S.C. § 227(a)(1).  The TCPA's definition of an ADTS is "Equipment that has the capacity - (A) to store or produce telephone numbers to be called, using a random or sequential number generator, and (B) to dial such numbers."