130 F. Supp. 3d 488
D. Mass.2015Background
- This is a diversity-based contract dispute arising from Scriven's termination as a former employee of the Reiser Company.
- Reiser Company sues for breach of contract, conversion, and breach of the implied covenant of good faith and fair dealing; Scriven counterclaims include fraud, breach, usury, undue influence, unconscionability, fiduciary duty, and retaliation.
- Reiser moved to dismiss seven of Scriven's eight counterclaims and for judgment on the pleadings on all Reiser claims; the court partially grants and partially denies both motions.
- Roger Reiser, as CEO, allegedly presided over a board-driven succession plan urging Roger's retirement; Scriven was recruited in 2013 to take a senior role with an at-will employment arrangement and potential long-term incentives.
- Scriven accepted the offer, resigned from Weber, Inc., and joined Reiser in July 2013; relocation loans were provided, including a $300,000 house loan and later a $400,000 loan used for a Massachusetts townhouse.
- Scriven was terminated on February 2, 2015; after termination, he faced demands for a general release and a deed transfer of property, and there were disputes over severance pay and a promissory note.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Is Count One (intentional misrepresentation) pled with particularity? | Reiser argues Scriven fails to plead facts showing a false representation, falsity, and damages with specificity. | Scriven contends there were misrepresentations about the succession plan, the long-term incentive plan, and loan documents. | Count One dismissed for failure to plead with particularity and injury. |
| Whether Counts Four–Six (usury, undue influence, unconscionability) survive without an executed note? | Reiser contends no contract was formed regarding the proposed note, so claims fail. | Scriven argues the proposed note and terms create a basis for those claims. | Counts Four–Six dismissed due to lack of execution/contract. |
| Whether Count Seven (breach of fiduciary duty) can proceed? | Reiser argues the claim is not properly pleadable and lacks a theory. | Scriven seeks leave to amend to add parties and theories. | Count Seven dismissed without prejudice to amendment. |
| Whether Count Three (breach of implied covenant) can proceed, and to what extent? | Reiser contends at-will status bars implied covenant claims not grounded in contract terms. | Scriven relies on multiple theories including severance and policy violations. | Count Three denied as to severance-based theory; otherwise denied. |
| Whether Count Eight (retaliation) survives | Reiser argues lack of protected activity causation or statutory basis. | Scriven alleges protected activity (overtime concerns and over-billing) led to termination. | Count Eight survives; prima facie showing of retaliation under MA law allowed to proceed. |
Key Cases Cited
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (pleading standard; plausibility required)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) (plausibility standard for pleading)
- Eureka Broadband Corp. v. Wentworth Leasing Corp., 400 F.3d 62 (1st Cir. 2005) (fraud elements and reliance standard)
- Kenda Corp., Inc. v. Pot O’Gold Money Leagues, Inc., 329 F.3d 216 (1st Cir. 2003) (statements of present intention may support fraud claims if misrepresented)
- UNO Restaurants, Inc. v. Boston Kenmore Realty Corp., 441 Mass. 376 (2004) (implied covenant scope and limitations)
- AccuSoft Corp. v. Palo, 237 F.3d 31 (1st Cir. 2001) (contract-based good faith interpretation)
- Smith v. Winter Place LLC, 447 Mass. 363 (2006) (statutory protection under wage laws; public policy context)
- Radio v. R.J. Reynolds Tobacco Co., 416 F. Supp. 2d 224 (D. Mass. 2006) (bad-faith termination and earned wages doctrine)
- Harrison v. NetCentric Corp., 433 Mass. 465 (2001) (at-will employment; public policy exceptions)
- Jackson v. Action for Boston Community Dev., Inc., 403 Mass. 8 (1988) (public policy and employment termination standards)