- Peter R. Pendergast won a $24 million FINRA arbitration
decision on behalf of firm clients. In January 2012, the FINRA (Financial Industry Regulatory
Authority) arbitration panel fined Citigroup for alleged breach of
contract. Prince Lobel’s clients, two financial advisers and their assistant, were
recruited by Citigroup and brought with them all of their clients and their
clients’ assets. The advisers were paid by commission as a percentage of
revenue generated from their clients’ transactions. While Citigroup paid them
in part on the first few transactions, our clients were subsequently cut out of
future transactions. The $24 million award includes compensatory damages,
sanctions, and interest.
- Joseph S. Sano and Thomas M. Elcock obtained summary judgment in Mutual Insurance Co. Ltd. v. The Honorable Ernest B. Murphy in favor of Mutual in an important bad faith declaratory judgment action against former Massachusetts Superior Court Judge Ernest B. Murphy. Mutual brought the action preemptively in federal court 30 days after Judge Murphy sent a demand letter under Massachusetts General Laws c. 93A and c. 176D. After Judge Murphy prevailed in his defamation action against Boston Herald, Inc. and recovered a $3.4 million judgment, he demanded an additional $6.8 million from Mutual, the Herald’s media liability insurer, alleging that Mutual engaged in unfair and deceptive acts and settlement practices by failing to settle when liability was reasonably clear.
Judge Saris of the United States District Court for the District of Massachusetts granted our Motion for Summary Judgment concluding, as a matter of law, that because Mutual did not have exclusive control over the Herald’s defense or settlement of the defamation action, Mutual had no duty to Judge Murphy to effectuate a settlement of that action under Massachusetts G.L. c. 93A or c. 176D. This ruling has broad significance in cases involving media liability, errors and omissions, and other insurance policies where the insured controls defense and settlement to protect its reputational interests. The decision is also important for excess insurers and reinsurers who exercise association rights, but do not control the insured's defense.
As a result, Mutual does not have to pay Murphy $6.8 million, and insurers who do not control defense and settlement of claims against their insured should be free from bad faith claims for failing to settle.
- Prince Lobel attorneys defended their client and ten male supervisors against claims by six female former employees, each of whom claimed that she was subjected to gender discrimination and retaliation. Among their claims, the women contended that they received inferior equipment and were subjected to greater discipline than male bus drivers who worked for the company. The plaintiffs sought compensatory and punitive damages against the company, in addition to attorney fees and costs. Prince Lobel's attorneys proved that, with the right facts, juries can get beyond first impressions created by "me too" evidence. After a five-week trial, the jury returned a take-nothing verdict in favor Prince Lobel's client and the ten male supervisors.
- Thomas M. Elcock and William A. Worth won a significant victory before the Supreme Judicial Court of Massachusetts in a wrongful death action, Afarian v. Massachusetts Electric Company, et al. This action arose from a motor vehicle accident in which a passenger was killed when the car in which he was riding, driven by an intoxicated underage driver, crashed into a utility pole jointly owned by the electric company and the telephone company. The decedent’s estate claimed that the defendant utilities owed a duty of reasonable care in the placement of their utility poles and that this duty was breached by the placement of the pole too near the street and on the outside of a curve. The decedent’s estate claimed that the utility companies were therefore responsible for the passenger’s death. The Massachusetts Superior Court granted summary judgment to the utility defendants and the plaintiffs appealed. The Supreme Judicial Court, adopting the Restatement 2d of Torts, section 368 for the first time in Massachusetts, held that the utility defendants owed no duty to the plaintiffs because the driver was underage and intoxicated, he did not deviate from the road in “the ordinary course of travel” and his collision with the utility pole was therefore not foreseeable. The court adopted section 368 of the Restatement of Torts, holding that a contrary decision would effectively impose strict liability on utility companies for all collisions with poles by drunk drivers.
- After nearly three years of litigation, plaintiffs suing our client, Fox Television, dropped their defamation claims with no payment of any kind. Joseph D. Steinfield and a team of Prince Lobel lawyers defended WFXT Fox-25 in suits brought by leaders of the Islamic Society of Boston and by the Islamic Society itself, alleging that a series of broadcasts investigating the ISB and its leaders were defamatory and that Fox and other defendants had violated their civil rights and conspired to prevent the completion of a new mosque in Boston. After extensive written discovery, and just as depositions were about to begin, the plaintiffs withdrew their lawsuits for no consideration. This case has received extensive publicity, including an article entitled "Be Careful What You Sue For," published in The Wall Street Journal on June 6, 2007.
- Joseph D. Steinfield has handled a succession of federal cases in Puerto Rico, including a civil rights action on behalf of a San Juan insurance executive against the Commissioner of Insurance. On June 12, 2007, the Court of Appeals for the First Circuit issued a decision in Guillemard v. Contreras, a Puerto Rico case in which Joe Steinfield and Jeffrey J. Pyle represented a San Juan businessman, his wife and their insurance agency in a civil rights suit against the former and present Insurance Commissioners of Puerto Rico. The case included constitutional claims for violation of First Amendment rights, including a retaliation claim and a political discrimination claim; violation of the right of due process; denial of equal protection; and defamation under Puerto Rico law. The federal district awarded summary judgment holding that defendants' failure to provide a hearing before suspending licenses violated our clients right to due process, and the Court of Appeals ruled that the defendants are not entitled to immunity on that claim. In December 2005, the First Circuit Court of Appeals denied the Commissioner's claim of qualified immunity. In January 2006, the district court issued a summary judgment ruling in favor of our client, holding that the Commissioner violated his constitutional right of due process. The case is Guillemard-Ginorio v. Contreras, 2006 U.S. Dist. LEXIS 640 (D.P.R. Jan. 10, 2006).
- Two firm partners successfully resolved a complex licensing dispute by obtaining a significant settlement for our client, a counterclaim plaintiff, in an action involving whether the use of the client’s trademark and logo on its own outsourced e-commerce website violated the exclusivity clause of a license agreement. Our client, a large U.S. corporation that has developed significant goodwill and brand name recognition associated with its name, logo and trademarks, licensed its name and logo for use by a licensee for a particular product line. The license agreement contained a limited exclusivity clause with our client agreeing that it would not grant another license in connection with the licensee’s product line. After the license was granted, our client outsourced its e-commerce sales and entered into a services agreement with a vendor to design and operate the client’s e-commerce website. The new website became operational and it principally sold the client’s products. The site also offered complementary products manufactured by third parties, including products in the licensee’s product line.
In its complaint, filed in the U.S. District Court for the District of Massachusetts, the licensee alleged a breach of the exclusivity clause of the license agreement because our client offered third-party products for sale on its website that were the same kind of products manufactured by the licensee. The licensee further claimed that the services agreement between the client and the website operator constituted a license because it gave permission to the website operator to use the client’s name and logo in connection with e-commerce sales of the third party products. On behalf of our client, we asserted counterclaims arising from the licensee’s failure to make guaranteed minimum royalty payments. After extensive discovery and the filing of cross-motions for summary judgment, a settlement was consummated whereby the licensee made a substantial payment to our client and the parties agreed to terminate the license agreement.
- John F. Bradley represented the largest holder of interests in a Massachusetts Business Trust. John worked with the client in connection with the sale of its manufacturing company subsidiary, its Tunisian indirect subsidiary, and two affiliated real estate trusts for a total of more than $60 million, as well as the simultaneous redemption of our client's interest in those Trusts. As a result of John's successful negotiations, our client was not subject to the escrow established in the purchase documents, nor was the client liable for potential claims for indemnification or breach of contract by the Buyer against the Business Trust or the other holders.
- John F. Bradley completed the sale of our client's aviation business to a multinational competitor. Our attorneys effectively negotiated the terms of the sale and also established a multiphase "earn-out," which provided our client with an opportunity to increase its earnings on the sale by up to 60 percent. The team successfully persuaded opposing counsel that various elements of the original proposal would create unnecessary risks and liabilities, and thereby guided both the buyer and seller to a more favorable result.
- John F. Bradley, assisted a client, who has multiple U.S. locations, establish a new office in London, its first overseas location. John worked with the client to create an appropriate "assignment letter" for the professional staff of the new office, including provisions for guaranteed round-trip flights home each year, health insurance, tax adjustments, and moving expenses to keep the employees "whole." Plans for a second overseas office - in Singapore - are now underway.
- On behalf of his client, a leading provider of prepaid phone cards, Richard Briansky obtained a preliminary injunction in federal court prohibiting a large public telecom company from producing, distributing, and selling prepaid telephone cards that infringed upon the copyrights of his clients. At issue were several successful prepaid telephone calling cards which formed a critical component of the client's business which was being harmed by the telecom company's infringing actions. The large telecom company, which had ignored demands of both the client and its prior counsel to cease and desist using the copyrighted cards, claimed that it owned the rights in the cards and sued the client seeking to collect millions of dollars.
Briansky assessed the situation, secured the necessary evidence, and filed and obtained an injunction immediately stopping the illegal distribution of the client's prepaid cards, protecting the client's copyrights and critical business interests.
- Richard Briansky secured a dismissal on behalf of a general contractor client on claims filed by the owner arising out of a $26 million residential development. The owner alleged that the general contractor had submitted fraudulent bills and had received in excess of $1.1 million to which it was not entitled. The owner filed suit, obtained an injunction effectively terminating the general contractor's contract, and precluding the general contractor from recovering over $300,000 in equipment. Rich investigated the claims, collected documents and developed a creative legal strategy which resulted in the dissolution of the injunction, the recovery of the general contractor's equipment, and the dismissal of the case.
- Jeffrey J. Pyle represented a client that finances the leasing of medical equipment in a controversy over one of its equipment leases. Our client entered into a finance lease agreement with an eye doctor. The lease provided that the doctor would choose two lasers for eye-correction surgery, and that our client would lease the lasers to him. However, the lasers that the doctor chose -- worth over $500,000 -- did not have FDA approval. Unable to use the equipment, the doctor sued our client, asking that the leases be rescinded on the ground that they were "illegal." The doctor also stopped making lease payments. The court awarded summary judgment in our client's favor, both on the doctor's claim that the leases should be rescinded, and on our client's counterclaim for the balance due.
- Litigation partner Daniel S. Tarlow won a victory in the Massachusetts Appeals Court on behalf of a client in a real estate case that involved a right of first refusal agreement. In 1977, the parties entered into an "Agreement of First Refusal" whereby the plaintiff had a right of first refusal should the defendant, who was represented by our firm, ever choose to sell the premises. Upon receiving notice of the intent to sell the premises to a third party, the plaintiff would have ten days to approve or reject the third party's offer. In 2002, the 25-year-old first refusal agreement came into sharp relief as a third-party offer was made and accepted on the property. The third-party offer was a $1.2 million, all cash deal. The plaintiff was given prompt notice of the offer and at first tried to exercise the right by offering $1.2 million with a mortgage contingency. Our client rejected the attempted exercise because of the mortgage contingency. Then, on the eleventh day, the plaintiff removed the mortgage contingency from its offer. Given the 10-day deadline in the agreement, our client rejected this second attempt as untimely. The Appeals Court rejected plaintiff’s arguments that its attempted exercises were valid. The court stated that “a notice of acceptance that is in any respect conditional ... is not an operative notice of acceptance.” The court also rejected the second, eleventh day, attempted exercise: “The Agreement provided that [plaintiff] had ten days from receipt of notice … to exercise his rights. [Plaintiff]’s August 6 letter was dated eleven days after he received such notice.” In the end, the court found in favor of the firm's client. Rights of first refusal have been a source of much litigation, and can be a trap for the unwary legal practitioner. This decision helps establish clear rules of the road in exercising a right of first refusal: a party’s exercise cannot be even a day late and cannot be conditional in any sense. The Court of Appeals decision, establishing and re-affirming these clear and important principles, should help parties avoid litigation in the future.
- In Kelley v. Kelley, 64 Mass App. Ct. 733 (2005), the Massachusetts Appeals Court held that a reduction in alimony based on an earning capacity theory was erroneous where a former wife continued to be the primary caregiver of the party’s three minor children and to work as a part-time artist. In reversing the alimony reduction, the court reaffirmed the traditional concepts of alimony and expressed the court’s long-established reluctance to attribute income to a primary caregiver, declaring that “individuals are often capable of earning more money than they presently do, but career choices are influenced by a number of factors, including family, education, training, and personal interests …” Attorneys Donald G. Tye and Peter A. Kuperstein also successfully argued that the trial court erred in failing to award the former wife her costs and counsel fees she incurred in response to her former husband's attempt not only to misrepresent his income, but also to transfer income-producing assets to another family member. Our client ultimately was awarded costs and counsel fees on both the trial and appellate levels.
- In an age discrimination case brought by a former marketing manager challenging his termination in a large-scale layoff, our firm was able to achieve summary judgment in the United States District Court by showing the court that our client had a detailed layoff selection process that the plaintiff’s manager followed, and that it was not for the court to second-guess the wisdom of the manager’s application of the selection criteria.
- Walter B. Prince, counsel to the Suffolk County Sheriff's Department, helped to clear Sheriff Andrea Cabral of any potential criminal charges from a federal investigation that started in mid 2003 as a result of the sheriff's department barring a contract employee from entering the facility for failing to perform the requirements of her position. The employee filed a civil suit against the sheriff’s department claiming that she was barred from the jail for assisting the FBI with its investigation of inmate abuse at the facility and not because of her job performance. On October 6, 2005, the United States Attorney for the District of Massachusetts announced that the pending two year grand jury investigation of the sheriff’s department was officially closed.