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Pierce & Mandell’s SJC Victory Could Have Lasting Impact on Trust and Estates Law in Massachusetts

Tuesday, November 14, 2017
Pierce Mandell - SJC Victory

The SJC’s recent decision in Ajemian v. Yahoo, overturning the grant of summary judgment against Pierce & Mandell’s clients, continues to reverberate in the legal community. A link to the Lawyer’s Weekly article entitled “SJC Ruling Could Have Significant Implications for T&E Law” can be found here.

SJC Ruling Provides New Remedies for Shareholders of Deadlocked Corporations

Monday, November 13, 2017

Sam Hoff, Pierce & Mandell, P.C.By Sam Hoff

In its recent ruling in Koshy v. Sachdev, the Massachusetts Supreme Judicial Court issued an early holiday gift to any shareholder of a deadlocked Massachusetts corporation. Thanks to the SJC’s ruling, such shareholders now have available to them several alternative forms of relief which may allow them to regain control of their corporation, as opposed to taking the “extreme” measure of dissolving their corporation.

The facts in Koshy are all too familiar to any shareholder who has experienced the frustration of corporate deadlock before. Two friends, Koshy and Sachdev, co-founded a corporation which provided computer aided design services. They split the corporation’s shares 50/50 and served as its only two directors. After some initial growth and success, Koshy’s and Sachdev’s relationship began to deteriorate. They differed in opinion on a variety of issues including strategic business decisions, the amount and frequency of distributions, and managerial hiring. Their inability to compromise with one another on these issues eventually caused business to grind to a halt. Koshy and Sachdev each attempted to buy the other out and, as a last resort to get out of business with Sachdev, Koshy brought suit claiming that the corporation was deadlocked and must be dissolved. A Superior Court judge found that no deadlock existed, and Koshy appealed the finding.

Koshy is the first case in which the SJC has been called to interpret Section 14.30 of the Massachusetts Business Act (the “Act”). The Act allows any shareholder who holds 40% of the combined voting power of a corporation’s outstanding stock to petition the Superior Court to dissolve the corporation in the event that its directors are deadlocked. The SJC determined that the Act applies only in cases of “true deadlock” and set forth four factors which are relevant in determining whether true deadlock exists:

(1)Whether irreconcilable differences have resulted in a “corporate paralysis,” which is defined as a stalemate between the directors concerning a primary function of management (e.g., payroll, client services, hiring and retention of employees, and/or corporate strategy).

(2)The size of the corporation at issue, with deadlock more likely to occur in a small or closely held corporation, particularly one where ownership is divided on an even basis between two shareholder-directors.

(3)Any indication that a party to a lawsuit has manufactured a dispute in order to engineer a true deadlock.

(4)The degree and extent of distrust and antipathy between the directors.

Where true deadlock exists, relief is available under the Act so long as the shareholders cannot work around the deadlocked directors and irreparable injury is threatened to or being suffered by the corporation as a result of the true deadlock. The SJC found this to be the case in Koshy. Further, the SJC found that the relief available to shareholders of a deadlocked corporation is not limited to the “extreme” measure of dissolution, but includes alternative remedies such as a court-ordered buyout of one shareholder by another or the sale of the corporation to a third-party buyer. The appropriate remedy must be determined by the Superior Court on a case-by-case basis.

From a legal standpoint, the SJC’s ruling in Koshy is a major break from the prior understanding of the Act, as it opens the door for alternative equitable forms of relief. The key takeaway for shareholders of Massachusetts corporations is that they need not resign themselves to the dissolution of their corporation should it become truly deadlocked. This is especially good news for shareholders of small or closely-held Massachusetts corporations, many of whom have built their business from scratch and are personally invested in the goodwill and future success of the corporation. It is understandable that any such shareholder may be reluctant to dissolve his or her corporation. In light of the SJC’s ruling in Koshy, they may now bring suit and argue before the Superior Court that they should be allowed to regain control of their corporation and continue business by buying out their fellow shareholder(s).

Being a shareholder of a deadlocked corporation can be stressful and harmful to your bottom-line. If you find yourself in this situation, please contact the experienced business litigation attorneys at Pierce & Mandell to learn more about your rights and secure the future of your corporation.

Pierce & Mandell Lawyers Secure Landmark Supreme Judicial Court Victory

Wednesday, October 25, 2017

Pierce and Mandell LawyersBy Robert L. Kirby, Jr. and Thomas E. Kenney

The Massachusetts Supreme Judicial Court (“SJC”) recently issued a landmark ruling in a case of first impression, overturning a probate court judgment against Pierce & Mandell’s clients. Robert L. Kirby, Jr. argued the case before the six-justice panel, and Thomas E. Kenney assisted in preparing the appellate briefs.

The case concerned the efforts by Pierce & Mandell’s clients, personal representatives of their deceased brother’s estate, to secure access to the content of their brother’s email account with Yahoo! Yahoo! refused to provide the email content to the personal representatives asserting, among other defenses, that the federal Stored Communications Act (“SCA”) prohibited it from disclosing the email communications. The Norfolk County Probate Court entered summary judgment in Yahoo!’s favor, ruling that the SCA did prohibit such disclosure.

After Pierce & Mandell filed an appeal on its clients’ behalf, the SJC on its own initiative granted direct appellate review. Following oral argument, the SJC reversed the decision of the Norfolk Probate Court and vacated the judgment entered against Pierce & Mandell’s clients, unanimously holding that the SCA did not prohibit Yahoo! from disclosing the email communications to the personal representatives.

The issue before the SJC was whether any of the statutory exceptions to the SCA’s prohibition of disclosure of the email communications applied. Acknowledging that the issue was one of first impression – no appellate court had previously decided whether the SCA barred disclosure of the decedent’s email communications to estate representatives – the SJC held that the SCA’s exception for disclosure “with the lawful consent of the originator or an addressee or intended recipient” of the electronic communications applied to permit Yahoo! to disclose the contents of the email communications to the personal representatives.

In so holding, the SJC rejected Yahoo!’s argument that “lawful consent” under the SCA must be the actual consent of the user of the email account. The Court reasoned that “interpreting lawful consent in such a manner would preclude personal representatives from accessing a decedent’s stored communications and thereby result in the preemption of State probate and common law.” Because nothing in the statutory language or legislative history of the SCA indicates Congress’ intent to preempt state probate law, and because there is a presumption against preemption in areas of traditional state regulation such as family law, the SJC ruled that the only reasonable interpretation of the “lawful consent” exception is that it permits personal representatives to consent to disclosure on behalf of the decedent in connection with their duties to the probate estate.

The SJC further stated that requiring the actual consent to disclosure of the account user “would significantly curtail the ability of personal representatives to perform their duties under State probate and common law.” Additionally, and “[m]ost significantly, this interpretation would result in the creation of a class of digital assets – stored communications –that could not be marshalled.” Thus, “since e-mail accounts often contain billing and other financial information, which was once readily available in paper form, an inability to access e-mail accounts could interfere with the management of a decedent’s estate.”

As a result of its decision, the SJC remanded the case to the Norfolk County Probate Court for a determination as to whether Yahoo!’s terms of service are binding on the personal representatives and, if so, whether those terms of service would permit Yahoo! to delete the contents of the email account rather than turn it over to the personal representatives.

Pierce & Mandell attorneys Robert L. Kirby, Jr., and Thomas E. Kenney regularly litigate in state and federal courts throughout Massachusetts. They handle a variety of cases including probate court litigation, business disputes and intellectual property matters.

A full copy of the opinion can be found here.

The New Massachusetts Pregnant Workers Fairness Act

Tuesday, October 03, 2017

Pierce & Mandell, P.C.By: Lena J. Finnerty

On July 27, 2017, Governor Baker signed into law the Massachusetts Pregnant Workers Fairness Act (the “MPWFA”) which extends the protections afforded pregnant workers in Massachusetts beyond those currently provided under federal law. The Act, which will go into effect April 1, 2018, will amend the current anti-discrimination statute in Massachusetts, to prohibit workplace and hiring discrimination related to pregnancy, nursing, and other pregnancy-related conditions.

Current federal law protects pregnant and new mothers from discrimination in the workplace under the Americans with Disabilities Act and Title VII of the Civil Rights Act, as amended by the Pregnancy Discrimination Act. If an employee is temporarily unable to perform their job due to a medical condition related to pregnancy or childbirth, the employer must treat that employee in the same way it treats other temporarily disabled employees. However, the ADA does not consider pregnancy itself a “disability.” Rather, only conditions or impairments resulting from pregnancy may be considered covered disabilities.

Massachusetts has expanded these protections under the new MPWFA to provide all pregnant and nursing employees with reasonable accommodations without having to establish that they have a covered medical condition. The language of the MPWFA will be codified with the current Massachusetts anti-discrimination statute, M.G.L. c. 151B, stating that it is an unlawful practice for employers to discriminate based on “pregnancy or a condition related to said pregnancy, including, but not limited to, lactation, or the need to express breast milk for a nursing child . . .”, and to deny a reasonable accommodation for an employee’s pregnancy or any condition related to the employee’s pregnancy, unless the employer can show that the accommodation would impose an undue hardship that requires significant difficulty or expense on the employer’s program, enterprise or business.

Requirements under the MPWFA

(1.) Engage in the Interactive Process

The employer and employee must engage in a timely and good-faith interactive process to determine effective reasonable accommodations to enable the employee to perform the essential functions of their job.

(2.) Reasonable Accommodation

Examples of reasonable accommodation under the MPWFA include:

  • More frequent or longer paid or unpaid breaks;
  • Time off to recover from childbirth with or without pay;
  • Acquisition or modification of equipment or seating;
  • Temporary transfer to a less strenuous or hazardous position; and
  • Private non-bathroom space for expressing breast milk.

(3.) Documentation

An employer may request documentation from an appropriate health care or rehabilitation professional about the need for a reasonable accommodation, unless the request is for the following pregnancy accommodations: (1) more frequent restroom, food or water breaks; (2) seating; (3) limits on lifting over 20 pounds; and (4) private non-bathroom space for expressing breast milk.

(4.) Notice

Covered employers must provide written notice to all employees of their rights under the MPWFA in the form of a handbook, pamphlet, or other written means, including the right to be free from discrimination based on pregnancy and related conditions, and the right to reasonable accommodations. Written notice must be provided to:

  • New employees at or prior to the start of employment;
  • Existing employees by April 1, 2018; and
  • Within ten (10) days of the date an employee informs the employer of their pregnancy or related condition.

Who is Covered

  • Employers with six (6) or more employees; and
  • All employees, regardless of sex or gender.

What Employers Should do Now

  • Provide written notice to all current employees by April 1, 2018; to new hires upon the date of hire; and within ten (10) days to any employee who informs employer of pregnancy or related condition;
  • Review and amend employee handbooks and policies to reflect compliance with requirements of MPWFA;
  • Train human resources personnel, managers, and staff about the requirements of the MPWFA; and
  • Consult counsel with any legal compliance questions regarding the MPWFA.

If you are an employer with questions on how to best comply with the new MPWFA and other statutory obligations, or an employee that believes their employment rights have been violated, contact the experienced employment law attorneys at Pierce & Mandell.

Pierce & Mandell Partner Dennis Lindgren Featured in Lawyers Weekly Profile

Friday, August 04, 2017
Dennis Lindgren

Pierce & Mandell Partner Dennis Lindgren shared his legal insights and tips in Lawyers Weekly Profile. Read more...

 

 

 

Pierce & Mandell Attorneys Help Merge Golf Associations

Tuesday, August 01, 2017

Pierce & Mandell, P.C., Hannah S. SpinelliBy Hannah S. Spinelli

In a historic move, on May 10, 2017 The Women’s Golf Association of Massachusetts, Inc. (“WGAM”) and Massachusetts Golf Association, Inc. (“MGA”) signed a merger agreement turning the two non-profit organizations into one golf association effective January 1, 2018. The interests of both groups will be united and efforts combined to promote the game to all members, male or female. The merged organization will retain the “MGA” name.

Pierce & Mandell, P.C., led by Bob Pierce, Bill Mandell, and Hannah Schindler Spinelli, represented WGAM in the merger and worked to ensure that WGAM’s mission and events (both competitive tournaments and instructional clinics) would be maintained for women within the newly merged MGA. In the official merger announcement, Cathleen Beach, WGAM’s Executive Director, championed the news, stating, “[t]his is an important moment for golf in Massachusetts. Together we will be stronger, more efficient and will reach even more golfers across the state.”

Merger of the two organizations creates an opportunity to maximize resources available to all Massachusetts golfers. MGA President Tom Bagley stated in the merger announcement: “After years of collaborating informally, it became clear to both Associations that we could better utilize all our resources – staff, volunteers and finances – if we work together.” As Tom further indicated, the goal moving forward will be for the merged association to serve all golfers in the Commonwealth. In other prior public remarks, the MGA’s Executive Director, Jesse Menachem, added, “[t]he MGA will greatly benefit from having women even more active in all facets of the organization.” On behalf of WGAM, President Leslie Logan stated, “We are confident that women's golf in Massachusetts will thrive under the new structure. Our membership, championships, events and scholarship programs will be better served by our two organizations coming together.”

By way of background, the MGA came into existence in 1903 and, throughout its time, has grown to include over 360 member clubs, annually sponsors 12 championships, and currently has more than 87,000 member golfers, growing into one of the larger golf associations in the country. MGA’s primary focus has been promoting the game to its member clubs, its individual members, and the general golfing public in the Commonwealth, as well as encouraging the growth of amateur golf.

The Women’s Golf Association of Boston was formed in 1900, before changing its name to WGAM in 1929, with the goal of fostering and promoting interest in women’s golf, and that it did: WGAM currently organizes 24 competitions throughout the year, offers scholarships for junior female golfers, and encourages women of all ages to participate in the sport.

Effective January 1, 2018, the MGA will preserve the traditions of each separate association and continue to grow through collaborative efforts promoting the game of golf. The two organizations initially announced plans to merge after signing a “Letter of Intent to Merge” on November 7, 2016 and each organization formally approved the merger in April, 2017.

Pierce & Mandell, P.C.’s business and real estate attorneys are skilled in all aspects of mergers and acquisitions, and can guide businesses, large or small, for profit or non, through the process to ensure a smooth and successful transaction.

The Wage Act – Are Commissions Considered Wages?

Tuesday, July 18, 2017

Pierce & Mandell, P.C., Boston, MABy Curtis Dooling

The Massachusetts Wage Act, G. L. c. 149, § 148, requires that employees pay their employees’ wages within six days of the end of the applicable pay period. The law includes harsh penalties for failure to pay wages, including the mandatory award of triple damages and attorneys’ fees. An employer that violates the Wage Act can also be subject to criminal penalties and corporate officers and directors can be held personally liable for Wage Act violations.

While the payment of hourly wages and salaries is generally straightforward, the payment of commissions can be decidedly less so. Employers often refuse to pay commissions to employees upon termination, even when the employee has earned the commission.

The Wage Act applies to commissions and the failure to pay earned commissions subjects employers to the same harsh penalties as the failure to pay hourly wages. The Wage Act states, in relevant part,

This section shall apply, so far as apt, to the payment of commissions when the amount of such commissions, less allowable or authorized deductions, has been definitely determined and has become due and payable to such employee, and commissions so determined and due such employees shall be subject to the provisions of section one hundred and fifty.

In other words, if the commission can be calculated and is due under the terms of an employment contract, the employer must pay it, or be subject to the penalties set forth in the Wage Act.

Even if the commissions are discretionary, that doesn’t necessarily mean they don’t fall under the guise of the Wage Act. Even when employers have wide discretion in making calculations and determinations as to the amount of commissions, an employee can still bring a Wage Act claim and can be awarded damages if the employee can show that the commissions were due and payable and definitively determined.

Pierce & Mandell’s litigation attorneys are well-versed in all aspects of the Wage Act and can guide both employers and employees through the process of filing and defending a Wage Act claim.

Pierce & Mandell Probate Lawyers Secure Appeals Court Victory In Case Involving Interpretation Of A Will

Thursday, June 22, 2017

Scott Zanolli, Pierce & MandelMichael Fee, Pierce & MandelBy: Michael C. Fee and Scott M. Zanolli

The Massachusetts Appeals Court recently affirmed a decision by Judge Virginia Ward, of the Suffolk County Probate Court, granting summary judgment to Pierce & Mandell’s client in a lawsuit seeking a declaration regarding the interpretation of a will. Michael C. Fee argued the case before the three-justice panel, and Scott M. Zanolli and Curtis B. Dooling assisted in drafting the brief.

The will at issue was prepared on behalf of the testatrix by her long-time companion at a time when she was suffering from terminal illness. The will made specific bequests of personal and real property, but omitted her interest as tenant in common with her brother in the family home. After her death, and her brother’s subsequent death, disputes arose regarding ownership of the real estate, and Pierce & Mandell’s probate litigators took the case to court in Boston.

After Pierce & Mandell secured summary judgment in its client’s favor, opposing counsel sought further review before the Appeals Court. The sole issue on appeal was whether the will’s residuary clause requiring a bequest of “any monies remaining in [testatrix’s] estate,” included by implication her one-half interest in real property. The clause at issue read specifically as follows:

“B. Residuary estate

“I direct that any monies remaining in my estate be given to my partner . . . , and, upon his death, to the . . . Center for the Creative Arts . . . ”

Michael C. Fee argued that the term “monies” in the will was not sufficient to devise real estate, and the Appeals Court agreed. The Court held:

Our case law has also eschewed the broader meaning [of monies] . . .. In our view, the rule of thumb in these circumstances is that “money” should be construed as commonly understood, unless “a reading of the whole will produces a conviction that the testator must necessarily have intended” the broader meaning. Metcalf v. First Parish in Framingham, 128 Mass. 370, 374 (1880). Nothing in the language or context of [the testatrix’s] will supports the broader interpretation.

Moreover, the Court expressly rejected the opposition’s argument that the caption “Residuary estate,” supported a broad interpretation of the word “monies” because, “[a]s English professors and writers, [the testatrix] would have selected a title that described in concise fashion what Article 2B was about.” Specifically, the Court stated:

One might equally expect English professors and writers to be precise in their choice of words, and not to have written “monies” if they meant “anything else.” See Strunk & White, The Elements of Style 21 (4th ed. 2000) (“If those who have studied the art of writing are in accord on any one point, it is on this: the surest way to arouse and hold the reader's attention is by being specific, definite, and concrete”).

Finally, the Court acknowledged that in interpreting wills under Massachusetts law there is generally a presumption against intestacy, and that “’a construction of a will resulting in intestacy is not to be adopted unless plainly required; and it is to be presumed that when a will is made the testator intended a disposition of all [her] property and did not intend to leave an intestate estate.’ Lyman v. Sohier, 266 Mass. 4, 8 (1929).” However, in this instance, nothing in the will’s language and the circumstances surrounding the execution of the will, demonstrated the testatrix’s intent with respect to her interest in the real estate.

Pierce & Mandell attorneys Michael C. Fee and Scott M. Zanolli regularly litigate in Probate Court in Boston, and throughout Massachusetts. Together they handle a variety of probate litigation and trust litigation cases including petitions for formal appointment of a personal representative, petitions for probate of wills, will contests, undue influence cases, contested accountings by personal representatives, trust petitions for allowance of accounts, contested trust accountings, and petitions for removal of trustees.

A full copy of the opinion can be found at Roth v. Newpol, 91 Mass. App. Ct. 609 (2017).

Pierce & Mandell Partners Recognized as Super Lawyers - Boston, MA

Wednesday, May 24, 2017

Pierce & Mandell, P.C. is proud to announce that partners Bob Pierce, Bill Mandell, Thomas E. Kenney, Michael Fee, Bob Kirby and Dennis Lindgren have been selected for inclusion in the 2017 Massachusetts Super Lawyers.

Bob Pierce was recognized as a Super Lawyer in the practice of Civil Litigation Defense, Bill Mandell in Health Care Law, Dennis Lindgren in Personal Injury General: Plaintiff and Tom Kenney, Michael Fee and Bob Kirby in Business Litigation.

Super Lawyers is a rating service of outstanding lawyers from more than 70 practice areas who have attained a high-degree of peer recognition and professional achievement. The selection process is multi-phased and includes independent research, peer nominations, and peer evaluations. Rising Stars are those attorneys under the age of 40 who have been nominated by peers for excellence in their chosen practice area. Candidates are then evaluated utilizing twelve indicators of peer recognition and professional achievement. No more than 3 percent of eligible lawyers in Massachusetts are named to the Rising Star list each year.

The Super Lawyers supplement will be published in the November, 2017 issue of Boston Magazine and is widely distributed in regional publications and across the country.

For information or assistance from Pierce & Mandell, P.C., contact us.

Bill Mandell was Quoted in the April 2017 Emergency Department Legal Letter Article

Thursday, April 06, 2017

Pierce & Mandell, Curtis DoolingBill Mandell was quoted in the April 2017 Emergency Department Legal Letter article on visitors and guns in hospital emergency departments and suggested a useful policies for hospitals to consider.



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