117 F. Supp. 3d 98
D. Mass.2015Background
- Mallinckrodt hired AECOM to decontaminate a former CT plant site in St. Louis; Target Price was $3.7 million under a Partnered Payment Structure.
- Bid proposals and amendments incorporated AECOM’s bid and defined Target Price, target volume, and incentive structure; adjustments required written agreement.
- AECOM sought multiple budget increases beyond the Target Price due to larger-than-expected contamination and delays; Mallinckrodt refused to adjust the Target Price but authorized limited additional spending.
- Mallinckrodt terminated AECOM in May 2012 and engaged Energy Solutions to complete the project for about $5.4 million.
- Mallinckrodt alleged breach of contract and related claims; AECOM asserted 93A, misrepresentation, breach-related theories, and declaratory relief.
- Water permit violations occurred; AECOM investigated and revised procedures; dispute over liability and damages continued.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether MA 93A claims survive center-of-gravity analysis | Mallinckrodt argues MA 93A center of gravity in MA | AECOM argues center of gravity outside MA | 93A claims dismissed for not primarily in MA |
| Whether AECOM’s negligent misrepresentation claim survives | AE-COM asserts misrepresentations about volumes and costs | Mallinckrodt argues no duty or breach; statements were estimates | Granted Mallinckrodt summary judgment on negligent misrepresentation (Count 6) |
| Whether contract is void due to mutual mistake | AECOM seeks declaration that contract is void due to mutual mistake | No mutual mistake; risk allocation and unknown volumes show risk-taking | Mutual mistake inapplicable; contract stays valid |
| Whether contract terms require payment of costs plus incentive fee despite disputes | AECOM entitled to at least costs plus 3% under incentive clause | Mallinckrodt argues breaches excuse payment | Contract interpretation favors payment of cost plus minimum 3%; trial on breaches still needed |
Key Cases Cited
- Kuwaiti Danish Computer Co. v. Digital Equip. Corp., 438 Mass. 459 (Mass. 2003) (center of gravity analysis for 93A sparse and fact-intensive)
- Fishman Transducers, Inc. v. Paul, 684 F.3d 187 (1st Cir. 2012) (center-of-gravity framework for 93A)
- Craig v. Everett M. Brooks Co., 351 Mass. 497 (Mass. 1967) (estimation reliance; not controlling here)
- Nota Construction Corp. v. Keyes Associates, Inc., 45 Mass.App.Ct. 15 (Mass. App. Ct. 1998) (mutual mistake and uncertainty in subsurface quantities not actionable)
- Covich v. Chambers, 8 Mass.App.Ct. 740 (Mass. App. Ct. 1979) (mutual mistake risk allocation under Restatement framework)
- NSTAR Elec. Co. v. Dept. of Pub. Utils., 462 Mass. 381 (Mass. 2012) (incorporation of extrinsic materials requires clear incorporation language)