Lorenc v. Be Free, Inc.

16 Mass. L. Rptr. 638
CourtMassachusetts Superior Court
DecidedAugust 25, 2003
DocketNo. 200004470
StatusPublished

This text of 16 Mass. L. Rptr. 638 (Lorenc v. Be Free, Inc.) is published on Counsel Stack Legal Research, covering Massachusetts Superior Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Lorenc v. Be Free, Inc., 16 Mass. L. Rptr. 638 (Mass. Ct. App. 2003).

Opinion

Gershengorn, J.

The plaintiff, Joseph Lorenc (“Lorenc”) brought this action in Middlesex Superior Court against his former employer, the defendant Be Free, Inc. (“Be Free”), and two of Be Free’s executives, the defendants Gordon Hoffstein (“Hoffstein”) and Stephen Joseph (“Joseph”). The Counts contained in Lorenc’s Verified Complaint are as follows:

Count I: Breach of Stock Option Contract
Count II: Breach of Fiduciary Duty (asserted against Hoffstein and Joseph)
Count III: Breach of Contract, Wrongful Discharge
Count IV: Breach of Contract, Failure to Maintain Harassment-Free Workplace as Set Forth in Employment Handbook
Count V: Breach of Implied Covenant of Good Faith and Fair Dealing
Count VI: Violation of Title I of the Americans With Disabilities Act
Count VII: Violation of the Massachusetts Civil Rights Act (asserted against Be Free and Hoffstein)
Count VIII: Loss of Consortium (brought by plaintiff Laurie Lorenc against all defendants)

The defendants removed this action to the United States District Court for the District of Massachusetts, and on January 31, 2003 Judge Gertner granted Be Free’s motion for summary judgment as to Count VI of the Complaint, and remanded the case to this Court for further proceedings. This matter is before the Court on the defendants’ motion for summary judgment as to all of the plaintiffs’ remaining claims, and on Lorenc’s cross motion for summary judgment as to Count I. For the reasons set forth below, the defendants’ motion for summary judgment is ALLOWED as to Counts I, II, IV, V, VII, and VIII, and DENIED as to Count III. Lorenc’s cross motion for summary judgment as to Count I is DENIED.

I. BACKGROUND

Pursuant to the summary judgment record, the undisputed material facts and the disputed facts viewed in the light most favorable to the non-moving party are as follows.

In late 1997, Be Free was a small internet start-up company specializing in on-line affiliate marketing. The founders of the company, Sam and Thomas Gerace, began to search for a management team that would encourage venture capital firms to invest in their company. To this end, the Geraces retained Hoffstein as Be Free’s Chief Executive Officer, and they also hired Joseph to serve as Be Free’s Chief Financial Officer. Hoffstein and Joseph had previously worked together at another technology company, PCs Com-pleat.

During the summer of 1998, Hoffstein began to contact other former PCs Compleat employees with whom he had worked to see if they were interested in working at Be Free. One such person was Lorenc, who had worked with Hoffstein for approximately six years at PCs Compleat.3 Although Lorenc did not report directly to Hoffstein during their time together at PCs Compleat, Hoffstein was familiar with Lorenc and regarded him as a competent manager based upon his performance managing the sales department at PCs Compleat. In late August 1998, Hoffstein called Lorenc and invited him to a meeting to discuss the possibility of an employment opportunity at Be Free. Lorenc accepted this invitation, and a few days later he met with Hoffstein and Joseph for dinner.

At the dinner meeting, Hoffstein described the role in which he envisioned Lorenc as follows: “He [Hoffst-ein] described it as the department would be client services. It would be the most people-intensive department, meaning the largest department in the company, and that I would be responsible for building, managing, growing, leading the department.” (Lorenc Depo., p. 23.) Hoffstein then discussed the compensation package that Lorenc would receive if he decided to accept the position at Be Free. The package included a salary of $110,000 per year, an annual bonus of $25,000, and 1.5% stock ownership in Be Free, subject to a vesting period that had yet to be determined. As to the vesting period of the 1.5% share in Be Free, Lorenc testified as follows:

[640]*640Q: What exactly did Mr. Hoffstein say to you about the 1.5 percent ownership in the company? To the best of your recollection, what did he say to you?
A: To the best of my recollection, he said that I would receive 1.5 percent ownership of the company that would be my stake . . . [a]nd that there would be some schedule that had yet to be determined.
Q: Some schedule of what type?
A: There was no definitive plan, vesting plan.
Q: It was your understanding, at least from what Mr. Hoffstein said, was that there was going to be some stock plan put into effect?
A: Right. And he said it would be a year and a half, two years tops.
Q: When you say a year and a half to two years tops, what do you mean?
A: He [Hoffstein] defined the process, he defined Be Free as a quick hit, and this would be one and a half to two years tops, which my understanding was would be one and a half to two years forthat I’d either be there or to reap the full rewards of the package he was presenting to me . . .
Q: Did you ask Mr. Hoffstein to be any more specific than that about the stock plan that would be put into effect?
A: Other than, you know, when he said that, it was still to be determined, and it would be a year and a half, two years tops, and all of those plans had to be worked out, I understood that it was to be worked out.

(Lorenc Depo., pp. 32-34.)

With regard to the proposed duration of Lorenc’s employment, Lorenc testified:

Q: And what did Mr. Hoffstein say about promising you employment until the stock vested?
A: He implied that we would work together as a team, that it would be a great ride, and how he looked forward to working with me throughout that time period. Promises made or implied, I would have to say, in layman’s terms.
Q: Other, than that, did he say anything else about promising you employment until the stock vested that you recall?
A: Implied.
Q: But did he say anything else, is what I’m asking you, Mr. Lorenc?
A: Anything else. Not that I recall. . .
Q: At the dinner meeting did you ask Mr. Hoffstein under what circumstances your employment could be terminated?
A: No.

(Lorenc Depo., pp. 37, 41.) After Hoffstein discussed the terms of the proposal, he took out a piece of paper, wrote down “110 YR., 25 BONUS, 1.5%,” and asked Lorenc if he was on board. Lorenc accepted Hoffstein’s offer, and he commenced his employment at Be Free at the end of August 1998.

As Vice President of Client Services at Be Free, Lorenc was responsible for the development and oversight of the Client Services Department (the “Department”). The Department’s goal was to ensure 100% client satisfaction.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Lewis v. Chase
505 N.E.2d 211 (Massachusetts Appeals Court, 1987)
Pederson v. Time, Inc.
532 N.E.2d 1211 (Massachusetts Supreme Judicial Court, 1989)
Fortune v. National Cash Register Co.
364 N.E.2d 1251 (Massachusetts Supreme Judicial Court, 1977)
Donahue v. Rodd Electrotype Co. of New England, Inc.
328 N.E.2d 505 (Massachusetts Supreme Judicial Court, 1975)
Smith v. Commissioner of Mental Retardation
567 N.E.2d 924 (Massachusetts Supreme Judicial Court, 1991)
Kourouvacilis v. General Motors Corp.
575 N.E.2d 734 (Massachusetts Supreme Judicial Court, 1991)
Mouradian v. General Electric Co.
503 N.E.2d 1318 (Massachusetts Appeals Court, 1987)
Sena v. Commonwealth
629 N.E.2d 986 (Massachusetts Supreme Judicial Court, 1994)
Caron v. Silvia
588 N.E.2d 711 (Massachusetts Appeals Court, 1992)
Jackson v. Action for Boston Community Development, Inc.
525 N.E.2d 411 (Massachusetts Supreme Judicial Court, 1988)
Kravetz v. Merchants Distributors, Inc.
440 N.E.2d 1278 (Massachusetts Supreme Judicial Court, 1982)
Riblet Products Corp. v. Nagy
683 A.2d 37 (Supreme Court of Delaware, 1996)
Maynard v. Royal Worcester Corset Co.
85 N.E. 877 (Massachusetts Supreme Judicial Court, 1908)
Hunt v. Bassett
269 Mass. 298 (Massachusetts Supreme Judicial Court, 1929)
Beal v. Board of Selectmen
646 N.E.2d 131 (Massachusetts Supreme Judicial Court, 1995)
O'Brien v. New England Telephone & Telegraph Co.
664 N.E.2d 843 (Massachusetts Supreme Judicial Court, 1996)
Harrison v. NetCentric Corp.
744 N.E.2d 622 (Massachusetts Supreme Judicial Court, 2001)
Ng Bros. Construction, Inc. v. Cranney
766 N.E.2d 864 (Massachusetts Supreme Judicial Court, 2002)
USTrust v. Henley & Warren Management, Inc.
663 N.E.2d 1238 (Massachusetts Appeals Court, 1996)

Cite This Page — Counsel Stack

Bluebook (online)
16 Mass. L. Rptr. 638, Counsel Stack Legal Research, https://law.counselstack.com/opinion/lorenc-v-be-free-inc-masssuperct-2003.