548 F.Supp.3d 244
D. Mass.2021Background
- Sensitech (Delaware corp; principal place in Massachusetts) contracted with LimeStone (Dubai distributor) under a Distributor Agreement (exclusive rights in UAE/Saudi Arabia), executed c.2015 and extended through Dec. 2018.
- LimeStone allegedly owes Sensitech ≈ $115,000 and failed to return confidential information required to be returned at contract end; Sensitech alleges further misdeeds including improper sales and disclosure of confidential materials.
- Plaintiff alleges Alwash (LimeStone’s owner/Managing Director, resident of Amsterdam) posted a secretly recorded conversation and defamatory LinkedIn posts about Sensitech.
- Sensitech sued in Massachusetts state court; defendants removed to federal court. Court granted a preliminary injunction and later modified it; Alwash moved to dismiss for lack of personal jurisdiction.
- Defendants filed 12 counterclaims largely mirroring plaintiff’s claims (breach of contract, tortious interference, trade-secret misappropriation, Chapter 93A, Lanham Act, Sherman Act, abuse of process, etc.).
- Court resolved (1) Alwash’s personal-jurisdiction challenge and (2) Sensitech’s motion to dismiss the counterclaims under Fed. R. Civ. P. 12(b)(6).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Personal jurisdiction over Alwash (general) | Alwash signed the Agreement as LimeStone’s officer and thus is subject to Massachusetts forum clause and jurisdiction | Alwash never resided in or traveled to MA, has no MA contacts or property; timely challenged jurisdiction | Dismissed as to Alwash: officer status alone and signing in official capacity insufficient; no independent in‑forum contacts shown |
| Jurisdiction based on alleged LinkedIn defamation | Posts targeted Sensitech (MA company) and caused injury in MA, supporting specific jurisdiction | Posts were not purposefully aimed at Massachusetts; no intent to have MA‑specific effect | Relatedness satisfied but purposeful availment lacking; jurisdiction over Alwash declined |
| Counterclaim: Breach of contract & implied covenant | LimeStone alleges Sensitech sold recycled/unsuitable monitors, appointed competing distributor, and wrongfully terminated contract | Sensitech moves to dismiss for failure to state plausible breach | Survived: allegations (e.g., appointment of competing UAE distributor) plausibly state breach and breach of implied covenant |
| Counterclaim: Tortious interference | LimeStone alleges Sensitech interfered with LimeStone’s downstream contracts and opportunities | Sensitech argues allegations are conclusory and fail to identify specific lost contracts or malice | Dismissed: plaintiffs failed to identify specific contracts/opportunities or intentional improper means/malice |
| Counterclaim: Chapter 93A (unfair or deceptive acts) | LimeStone alleges knowing sales of recycled goods, blocking orders, wrongful termination, and direct dealing with LimeStone’s customers | Sensitech contends mere breach of contract insufficient for 93A | Survived: factual allegations plausibly state an unscrupulous commercial wrong (knowing breach to secure benefit) |
| Counterclaim: Sherman Act (antitrust) | LimeStone alleges anticompetitive conduct harming its business in Middle East | Sensitech invokes FTAIA to bar Sherman Act extraterritorial reach | Dismissed: FTAIA bars Sherman Act claims for conduct affecting only foreign commerce without a direct domestic effect |
| Counterclaim: Trade-secret misappropriation (MA law & DTSA) | LimeStone alleges Sensitech stole LimeStone’s confidential information | Sensitech argues allegations lack specificity about the trade secrets, protective measures, and improper means | Dismissed: allegations are conclusory and do not identify particular trade secrets or reasonable secrecy measures |
| Counterclaim: Lanham Act (false designation/advertising) | LimeStone alleges Sensitech marketed products as new/properly tested but sold recycled/defective goods, harming LimeStone’s reputation and sales | Sensitech moves to dismiss for failure to plead deception and injury | Survived: allegations plausibly allege deceptive commercial advertising and resulting economic/reputational injury |
| Counterclaim: Malicious abuse of process | LimeStone contends Sensitech brought suit to silence and coerce LimeStone beyond litigation purposes | Sensitech says suit sought legitimate relief (injunction) and lacks ulterior purpose | Dismissed: no plausible allegation that Sensitech sought a collateral advantage beyond the suit’s aims |
Key Cases Cited
- Cossart v. United Excel Corp., 804 F.3d 13 (1st Cir. 2015) (prima facie burden for personal jurisdiction)
- Swiss Am. Bank, Ltd. v. United States, 274 F.3d 610 (1st Cir. 2001) (jurisdictional principles)
- A Corp. v. All Am. Plumbing, Inc., 812 F.3d 54 (1st Cir. 2016) (prima facie standard requiring evidentiary proffers)
- Astro‑Med, Inc. v. Nihon Kohden Am., Inc., 591 F.3d 1 (1st Cir. 2009) (relatedness, purposeful availment, reasonableness test for specific jurisdiction)
- Burger King Corp. v. Rudzewicz, 471 U.S. 462 (1985) (purposeful availment and foreseeability)
- Calder v. Jones, 465 U.S. 783 (1984) (effects/aiming test for jurisdiction in intentional torts)
- Hugel v. McNell, 886 F.2d 1 (1st Cir. 1989) (defamation and jurisdiction; effect alone insufficient)
- F. Hoffmann‑La Roche Ltd. v. Empagran S.A., 542 U.S. 155 (2004) (FTAIA limits Sherman Act extraterritorial reach)
- Lexmark Int'l, Inc. v. Static Control Components, Inc., 572 U.S. 118 (2014) (standing and injury under Lanham Act)
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (plausibility pleading standard)