McCarthy v. Ground Round, Inc.

9 Mass. L. Rptr. 195
CourtMassachusetts Superior Court
DecidedOctober 15, 1998
DocketNo. 942805
StatusPublished

This text of 9 Mass. L. Rptr. 195 (McCarthy v. Ground Round, 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
McCarthy v. Ground Round, Inc., 9 Mass. L. Rptr. 195 (Mass. Ct. App. 1998).

Opinion

Gants, J.

The plaintiffs have each obtained a substantial jury verdict on their claims of age discrimination in violation of G.L.c. 15 IB, §4. The jury awarded actual damages to each plaintiff for back pay, front pay, and emotional distress, and then found that the actual damages should be multiplied by 2.535 based on its finding that the defendant Ground Round, Inc. (“Ground Round”) knew or had reason to know that its conduct violated the law’s prohibition against age discrimination. I requested a memorandum of law from all parties regarding the appropriateness and, if so, the calculation of prejudgment interest on this judgment.

There is no dispute that pre-judgment interest should not be awarded for damages that represent front pay, since these damages were not yet suffered at the time of the verdict. Conway v. Electro Switch Co., 402 Mass. 385, 391 (1988). Nor is there any dispute that pre-judgment interest should not be awarded on the multiple of 2.535 in punitive damages. Fontaine v. Ebtec Corp., 415 Mass. 309, 326-27 (1993).

Four issues remain in dispute. First, the plaintiffs maintain that pre-judgment interest on compensatory damages for back pay and benefits and emotional distress should be awarded to the plaintiffs David Halligan and Robert Whitelaw from November 18, 1993, when they first filed their age discrimination complaint against Ground Round in the United States District Court for the District of Massachusetts, rather than November 30, 1995, when they filed this action in Norfolk County Superior Court. Although the case was properly filed in federal court and jurisdiction was appropriate there, Halligan and Whitelaw voluntarily dismissed their federal case in favor of re-filing in state court. I agree that the date of commencement of this action should be the date the action is commenced in any court, not necessarily in the Massachusetts Superior Court.

Under G.L.c. 231, §6H:
In any action in which damages are awarded, but in which interest on said damages is not otherwise provided by law, there shall be added by the clerk of court to the amount of damages interest thereon at the rate provided by Section six B to be determined from the date of commencement of the action

The rate provided by §6B is “twelve per cent per annum from the date of commencement of the action.”

The issue is whether the term “commencement of the action” under §6H means the commencement of the action in a Massachusetts court or simply the commencement of the action in any court. Courts are commonly faced with decisions as to where a case should best be litigated, regardless of where it was first filed, such as motions to remand an action, or to transfer a case to a more convenient forum, or, as in this case, to accept the voluntary dismissal of a case in favor of it being filed in another court. These decisions are best made when they are focused solely on issues of jurisdiction, venue, and convenience, and are not burdened by the prospect that they will adversely affect the amount of a judgment that a party would be entitled to if it were to prevail. If the term “commencement of the action” under §6H means the commencement of the action only in a Massachusetts court, then a plaintiff will lose pre-judgment interest whenever it commences an action in one forum and that action is subsequently transferred to a Massachusetts state court. In contrast, if the term “commencement of the action” under §6H means the commencement of the action in any court, then the transfer or re-filing of a case will have no substantive consequence on the amount of the ultimate judgment, and decisions as to the most appropriate judicial forum will be unburdened by such a consequence. I believe that this latter course is both wiser and more consistent with the statutoiy purpose. Consequently, I conclude that, when a case, as here, is filed in a federal court and voluntarily dismissed for the purpose of re-filing essentially the same action in a Massachusetts court, then the action should be deemed to have commenced on the date it was filed in federal court.

I note that, while I can find no Massachusetts case directly on point, this conclusion is supported by controlling case law in an analogous context. Under G.L.c. 260, §32, if an action that is timely commenced is dismissed “for any matter of form,” the plaintiff may commence a new action for the same cause within one year after the dismissal of the original action. In Liberace v. Conway, an action initially brought in federal court was dismissed and the plaintiff sought to bring the same action in Massachusetts state court within one year of the dismissal but after the statute of limitations had otherwise expired. 31 Mass.App.Ct. 40 (1991). The Appeals Court found that §32 applied with equal force to a case dismissed from federal court and later filed in a Massachusetts state court as it did to a case originally brought in a Massachusetts state court. Id. at 42-43. The Appeals Court declared:

Federal courts, in considering whether to dismiss pendent claims based on State law, have generally been reluctant so to do if the consequence were that the pendent claim would be barred in the State court by operation of a statute of limitations . .. The basis of those decisions is that the discretion reposing in a Federal judge not to adjudicate the State claim should be exercised in the interest of justice and in a fashion that will not prejudice the parties ... It would surely be anomalous to adopt a construction of §32 which deprived pendent claims of the statute’s benefit and thereby pressed on the Federal courts retention of jurisdiction over those claims.

[197]*197Id. at 43 (citations omitted). Just as a federal court should not be pressed to retain a case for fear that the plaintiff will be time-barred from filing the same claim in state court, so, too, should that federal court not be pressed to retain it for fear that the plaintiff will lose a substantial amount in prejudgment interest.

Second, Ground Round contends that prejudgment interest should not be awarded on the full amount of back pay. It observes, correctly, that for all but one plaintiff, as a result of the consultant fees and severance paid to the plaintiffs by Ground Round in 1993 following their termination, damages for back pay did not begin to accrue until early 1994 and then these damages accrued in roughly equal amounts each year up through the jury’s verdict in September 1998. Ground Round argues that, if prejudgment interest on the entire amount of back pay is paid from November 18, 1993 (for plaintiffs Halligan and Whitelaw) and from December 29, 1994 (for plaintiffs McCarthy and Stasiowski), it would provide a windfall to the plaintiffs, because it would essentially deem all back pay to have been earned and eligible to earn interest from that date when, in fact, back pay here did not even begin to accrue until early 1994 and then only accrued in weekly intervals up through the date of the verdict.

As a matter of principle, Ground Round is correct: the Supreme Judicial Court has declared it to be a “fundamental proposition that interest is awarded to compensate a damaged party for the loss of use or the unlawful detention of money.” Conway v. Electro Switch Corp., 402 Mass. at 390. It is for this reason that §6H “cannot reasonably be said to apply to an award of damages based upon lost earnings and benefits occurring after the date of judgment.” Id. at 391.

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Related

Charles D. Bonanno Linen Service, Inc. v. McCarthy
550 F. Supp. 231 (D. Massachusetts, 1982)
Fontaine v. Ebtec Corp.
613 N.E.2d 881 (Massachusetts Supreme Judicial Court, 1993)
Conway v. Electro Switch Corp.
523 N.E.2d 255 (Massachusetts Supreme Judicial Court, 1988)
Liberace v. Conway
574 N.E.2d 1010 (Massachusetts Appeals Court, 1991)

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Bluebook (online)
9 Mass. L. Rptr. 195, Counsel Stack Legal Research, https://law.counselstack.com/opinion/mccarthy-v-ground-round-inc-masssuperct-1998.