Boston Business Litigation Blog

The United States Court of Appeals for the First Circuit has held that, despite never crossing state lines in the course of their duties, "last mile" delivery drivers qualify for the Federal Arbitration Act's ("FAA") exemption for transportation workers due to their sufficient engagement in interstate commerce. Accordingly, the FAA did not apply to the Plaintiff's contract, state law applied instead, and the Plaintiff's claims could proceed in court rather than via arbitration. Waithaka v. Amazon.com, Inc. et al.

Unfortunately, the emotionally charged circumstances of divorce and custody cases can create very difficult conditions for the parties and their children. On occasion, one or both parties will engage in disparaging behavior - calling the other party names in public and to third parties, making insulting comments on social media, and spreading disinformation within the community about the case and the other party.

In the recent Memorandum and Order issued in the case T-Mobile Northeast LLC v. The Town of Barnstable, the Massachusetts District Court held that the Town of Barnstable Planning Board ("the Planning Board") had violated the Telecommunications Act of 1996 ("the TCA") when it denied T-Mobile's request for a special permit and regulatory agreement that would allow T-Mobile to install and operate wireless equipment in a church steeple for the purpose of improving local cell phone service coverage. The dispute arose after the town had issued T-Mobile a building permit and after the majority of the construction on T-Mobile's proposed site had already been completed, at which time citizens of Barnstable claimed that the proposed site fell within a geographic area of Cape Cod that is subject to heightened regulatory scrutiny. After several hearings and consideration of evidence submitted by T-Mobile, the Planning Board denied T-Mobile's request.

The First Circuit Court of Appeals recently found an agreement's arbitration clause unconscionable where one party was given almost unfettered control over the selection of the arbitrators. In Trout v. Organización Mundial de Boxeo, Inc., plaintiff Austin Trout ("Trout"), a professional boxer, claimed the defendant World Boxing Organization's ("WBO") decision to move him from a weight class cost him to opportunity to pursue a world championship in that class. He brought claims under the Muhammad Ali Boxing Reform Act, as well as breach of contract, fraud, and negligence claims.

In the recent Superior Court case of Martinez v. Burlington Motor Sports, Inc., et al., a defendant auto dealership moved to dismiss a commission-based employee's claim for overtime wages pursuant to G. L. c. 151, §§ 1A and 1B, arguing that the Massachusetts Supreme Judicial Court's (SJC) 2019 ruling in Sullivan v. Sleepy's LLC did not apply to the case. See Fitch's blog post on the Sleepy's decision here. The Sleepy's decision stands for the proposition that an employee paid on commission is entitled to separate and additional wages for minimum wage and to overtime and Sunday pay.

In GE Energy Power Conversion France SAS v. Outokumpu Stainless USA, the United States Supreme Court was presented with the question whether domestic equitable estoppel doctrines that allow a non-signatory to an arbitration agreement to compel arbitration in disputes arising under such agreement conflict with the Convention on the Recognition and Enforcement of Foreign Arbitral Awards of 1958, more commonly known as the New York Convention. The Supreme Court unanimously found no conflict, paving the way for non-signatories to agreements containing international arbitration clauses to compel arbitration using domestic doctrines of equitable estoppel.

In the recent unpublished Memorandum and Order Pursuant to Rule 1:28, Manning v. Manning, the Massachusetts Appeals Court overturned a custody judgment from the Probate and Family Court awarding a couple shared legal and physical custody of their two children due to the lower court judge's failure to make required findings of fact regarding the wife's allegations of domestic abuse by the husband. At the time of their divorce trial, the wife testified that her husband had abused her on numerous occasions during the marriage, including punching her, throwing objects at her, and grabbing her by the neck in front of their child. The trial judge credited the wife's testimony, writing in the judgment that the husband "physically battered and assaulted the [w]ife throughout the entire tenure of the marriage." Despite this finding, however, the judge ordered that the parties should have shared custody of their children, with each parent exercising parenting time for one week at a time.

In United States v. McLellan, the First Circuit upheld securities and wire fraud convictions against former State Street Vice-President and head of the Department of Transitional Services Ross McLellan ("McLellan"). McLellan was convicted by a jury in the United States District Court for the District of Massachusetts on charges of securities fraud, wire fraud, and conspiracy to commit securities and wire fraud. During his tenure as head of the transitional management group, McLellan served as the overseer of State Street's transition management program which assisted large institutional investors in restructuring their portfolios as they transitioned from one asset manager to another. At trial, the prosecution presented evidence that McLellan designed a scheme to promise low commissions to potential clients, then embedded large, hidden commissions into the price of the securities when reporting the prices to his clients.

For a plaintiff to obtain an abuse prevention order, colloquially known as a "restraining order," against a defendant, the issuing court must make a finding of abuse. For the purposes of 209A, abuse is defined as a) attempting to cause or causing physical harm; b) placing another in fear of imminent serious physical harm; or c) causing another to engage involuntarily in sexual relations. In cases where no attempted or actual physical contact has occurred, the question is generally whether the defendant placed the plaintiff in fear of imminent serious physical harm. Past cases have established that such fear must be reasonable in light of the totality of the circumstances of the parties' relationship.

In the recent case of Bliss v. Boston Clear Water Company, LLC (decided April 21, 2020), the Essex Land Court found that the plaintiff, Mary Bliss, had successfully proved a claim to ownership of property on the grounds of adverse possession because her family had been using the property adversely, openly, notoriously, exclusively, and continuously for a period spanning nearly thirty years. The Bliss family's use of the disputed land began in 1985 when Mary's husband, Gerald Bliss, started tending to the grounds of property that was owned at the time by his next-door neighbor. Specifically, the Bliss family paved a portion of the neighboring land, installed a fence around a well, constructed a pitcher's mound and a hockey net, and even went so far as to hire a professional landscaping company to conduct routine maintenance on the land. In addition, the Bliss family parked their cars on the land and allowed their guests to park there, and the family's children played openly on the property.

Unfortunately, the emotionally charged circumstances of divorce and custody cases can create very difficult conditions for the parties and their children. On occasion, one or both parties will engage in disparaging behavior - calling the other party names in public and to third parties, making insulting comments on social media, and spreading disinformation within the community about the case and the other party.

In the recent decision, McDonald v. Andrade, the Massachusetts Appeals Court reversed a trial court decision, awarding an easement to a Plaintiff who had - in the same lawsuit - obtained the land to which the easement pertained by adverse possession.

The Supreme Judicial Court recently issued a decision that confirms the legality of consent-to-settle clauses in professional liability insurance policies. In Rawan v. Continental Casualty Company, the SJC held that the refusal of an insured party to settle an underlying tort claim limits the insurance company's exposure to claims of unfair claim settlement practices as long as the company operates in good faith.

The COVID-19 public health emergency has ground many activities to a halt, including the vast majority of matters at Probate and Family Courts across the Commonwealth of Massachusetts. Although the impact of court closures has been felt most strongly in the paucity of hearings, other departments, like drug testing, lawyer of the day programs, conciliation and mediation sessions, have also been impacted by the requirements of state and local orders and advisories. 

Recently in Parker v. EnerNOC, Inc., the Supreme Judicial Court held that, per the Massachusetts Wage Act, G.L. c. 149, §§ 148A, 150, an employee, who was deprived of a commission as a result of a retaliatory termination by her employer prior to the commission coming due, was entitled to treble the amount of the unpaid commission.

The Massachusetts Wage Act allows an employee to recover "wages" that have been "unreasonably retained" by an employer.  A salary is within the scope of the statute.  What else is considered "wages"?  It's not clear because the term "wages" is not defined.  The statute simply provides that the term "wages" includes holiday and vacation time but such enumeration is not exhaustive.  Courts have interpreted the term "wages" to mean wages that have been "earned," as opposed to wages that are contingent on some other fact or are discretionary.  For example, accumulated sick days are not "wages" because they are contingent on a specific fact, i.e. the employee being sick.  The same is true for bonuses since they are paid at the discretion of the employer.  Commissions, however, are generally considered "wages" if they are not discretionary and are the result of the employee's work, provided that the amount of the commission is definitely determined and due and payable. 

Different states have different rules regarding when a parent's child support obligation ends. In some states, a parent's child support obligation ends when a child turns 18 years old. In Massachusetts, a parent's child support obligation generally lasts at least until the child reaches age 18, but could continue until when the child turns 21 if the child is living with a parent and dependent upon that parent, or up until the child turns 23 if the child principally lives with a parent and is dependent upon that parent due to the child's enrollment in an educational program (excluding educational costs beyond an undergraduate degree). See M.G.L. ch. 208, §28. 

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. 

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. 

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.

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.

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. 

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. 

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. 

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. 

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.

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. 

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.