By Kevin Peters
The Massachusetts Superior Court Business Litigation Session published an opinion this afternoon in the matter of Governo Law Firm LLC v. CMBG3 LLC that is interesting in several respects. The case involved allegations that departing law partners stole client files and administrative material from the firm and used them to start a new practice. The case was tried to a jury who awarded Governo $900,000 based on the defendants’ “conversion” and “breach of loyalty.” The trial court, in its discretion, also submitted the M.G.L. c. 93A § 11 claim to the jury who rejected it. The matter was appealed and remanded for retrial on the 93A claim. This time, the judge exercised his discretion and kept the claim rather than retry it to a new jury. The court concluded that although the defendants acted unfairly and deceptively in violation of M.G.L. c. 93A § 11, there was no liability because Governo suffered no damages. The reasoning, and the nuisances in the law that reasoning turns on, is what makes this decision interesting.
First, I have to profess my long-held view that claims under M.G.L. c. 93A § 11 should not be tried to a jury, at least not without expert testimony. I appreciate that juries are capable of very nuanced analyses, and that thorny questions are often submitted to them for determination. However, the case law under M.G.L. c. 93A § 11 analyzing what constitutes unfair and deceptive acts and practices has developed in subtle ways that I believe is difficult for 14 people to parse – that is, to apply in making moral judgments. I don’t think that it is particularly controversial to suggest that many practitioners use M.G.L. c. 93A § 11 as a kind of industrial spackle to fill the holes in their other legal theories. There’s nothing particularly wrong with that. But allowing a lawyer to argue industrial “unfairness” generically too easily leads to the kind of moral judgment that can be at odds with the industry or business practice under the microscope. In other words, to quote Judge Kass’s dogeared formulation, it is only conduct that is reprehensible enough that it “would raise an eyebrow of someone inured to the rough and tumble of the world of commerce” that violates M.G.L. c. 93A § 11. Levings v. Forbes & Wallace, Inc., 8 Mass. App. Ct. 498 , 504 (1979). Critically, it is not conduct that some jury thinks should raise their eyebrows.
That said, there is no doubt in my mind that the court got it right when it retried the case without a jury. Fundamentally, the court found that although documents were taken improperly in violation of M.G.L. c. 93A § 11, many were not used, and those that were belong to Governo’s clients and therefore could not be used by their new lawyers improperly. Consequently, the court determined, Governo was not harmed by the use of documents he had no right to keep and belonged to his former client.
To reach out to Kevin, fill out this form:
Finally, and importantly, the opinion reminds us that no one likes an angry witness. One of the reasons Governo lost was because he had a large, oversharp, and obvious ax to grind, and that influenced his credibility. The court noted this in detail and in crucial ways found Governo’s testimony to be untrustworthy. I tell my clients, as I’m sure many of you do, that testimony needs to be at roughly room temperature. With rare exception, what I call high-velocity testimony is risky in business cases. The fact is, no juror will ever care about your cases as much as you and your clients do, and many people are suspicious of loudmouths. Governo learned that the hard way.
To see an earlier post on this case written by Lee Gesmer on MassLawBlog click here.
Click below to read more about Kevin Peters:
Check out some of our latest publications.
- Lee Gesmer posted “Will The Supreme Court Decide Oracle v. Google on a Technicality?
- Lee Gesmer posted “Section 230 Supreme Court Argument in Gonzalez v. Google: Keep An Eye on Justice Thomas”
- Lee Gesmer posted “Final Thoughts On Google v. Oracle”
- Lee posted “Trump v. Facebook, Twitter and Google”
- Lee Gesmer posted “Biden Administration Signals Reversal Of Delrahim Position on Standard Essential Patents”
- Lee Gesmer posted “Lanier v. Harvard: ‘Do The Right Thing’”
- Lee Gesmer posted “The FTC: Non-Compete Agreements Must Go”
- Lee Gesmer posted “ChatGPT, Please Prepare a Software License Agreement”
- Lee Gesmer posted “Generative AI Images Struggle for Copyright Protection”