State Street Corp. v. Barr

11 Mass. L. Rptr. 191
CourtMassachusetts Superior Court
DecidedFebruary 15, 2000
DocketNo. 99-4291-F
StatusPublished
Cited by1 cases

This text of 11 Mass. L. Rptr. 191 (State Street Corp. v. Barr) 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
State Street Corp. v. Barr, 11 Mass. L. Rptr. 191 (Mass. Ct. App. 2000).

Opinion

Lauriat, J.

The plaintiff, State Street Corporation (“State Street”), brought this action against defendants Dean S. Barr, Joshua Feuerman (“Feuerman”), and Richard Goldman, for breach of contract and interference with advantageous business relations arising out of the defendants’ alleged failure to comply with the terms of certain alleged non-competition, non-solicitation, and non-disclosure covenants between State Street and the defendants. In response, Feuerman has asserted counterclaims against State Street for interference with contractual and business relations with his new employer, Banker’s Trust, and abuse of process. Feuerman also seeks a declaratory judgment that the agreements between Feuerman and State Street do not bar him from working for Banker’s Trust, soliciting State Street customers, or soliciting State Street employees. State Street has now moved, pursuant to the Massachusetts anti-SLAPP statute, G.L.c. 231, §59H, to dismiss Feuerman’s counterclaims against it. For the following reasons, State Street’s motion to dismiss is denied.

BACKGROUND

State Street is a financial institution that provides a variety of commercial and consumer financial services. State Street Global Advisors (“SSGA”) is an asset management division of State Street. The defendant was employed as a principal of SSGA until September 1, 1999, when he resigned from State Street to work for Bankers’ Trust, another asset management firm.

On or about September 15, 1997, Feuerman and State Street executed a stock Award Agreement (“Award Agreement”) and a Change of Control Agreement (“Control Agreement”), and on or about October 16, 1998, Feuerman and State Street executed a Long Term Incentive Plan Agreement (“Incentive Plan”) (collectively, “the Agreements”). The Agreements granted Feuerman benefits that would vest if he remained with State Street for a specified period of time. Both the Award Agreement and Control Agreement signed by Feuerman contained covenants not to compete, not to solicit State Street principals or clients, and not to disclose State Street trade secrets or other confidential information. The non-compete covenants provided in part, that:

for a period of eighteen (18) months following termination of employment for any reason, . . . [Feuer-man] shall not engage ... in any manner or capacity as advisor, principal, agent, partner, officer, director, or employee of any of the Top Five (5) (as defined below) institutions, or their subsidiaries.

The non-compete covenants defined the “Top Five" institutions as “the five institutions with the highest value of assets under management as listed in the most recent annual rankings of either Institutional Investor or Pension and Investment magazine,” not including State Street or its subsidiaries. The non-solicitation covenants required Feuerman to refrain, for eighteen months after the termination of his employment, from soliciting business from any client of State Street on behalf of any person or entity other than State Street.

In addition, the Award Agreement and Control Agreement required the defendant to hold in a fiduciary capacity all secret or confidential information, knowledge or data obtained as a result of his employment with State Street.

On September 1, 1999, Feuerman resigned from State Street to work for Banker’s Trust. State Street [192]*192commenced this action on September 3, 1999, and immediately sought a preliminary injunction. On October 22, 1999, the court (Brassard J.) issued a Memorandum of Decision and Order enjoining the defendants from engaging in certain prescribed conduct.1 While the court determined that State Street was likely to succeed on its claim that the covenants in the Agreements existed, it also concluded that State Street was not likely to succeed on the merits of its claim that Feuerman violated the non-compete covenants, because Bankers Trust was not a “Top Five” institution within the meaning of the parties’ Agreements. As a result, the court declined to enjoin Feuer-man from working for Banker’s Trust and only enjoined him from soliciting State Street employees.

On October 12, 1999, Feuerman served his Answer and Counterclaim. Count I of the Counterclaim seeks a declaratory judgment that Banker’s Trust is not a “Top Five” financial institution as defined by the parties’ agreements, and that the restrictive covenants in the agreements are otherwise void and unenforceable. Count II alleges that State Street knew that Feuerman had an existing agreement or advantageous business relationship with Banker’s Trust, that despite that knowledge State Street interfered with that agreement, that State Street should have known that Banker’s Trust was not a Top Five financial institution, and that the interference was intentional, malicious and done with unlawful motive or means. Count III alleges an abuse of process. Feuerman asserts that State Street made numerous false allegations, including allegations that Banker’s Trust was a “Top Five” financial institution, that State Street knew or should have known that Banker’s Trust was not a “Top Five” financial institution, and that State Street brought this civil action and motion for preliminary relief for an ulterior and improper purpose, namely to cause economic harm to Feuerman and Banker’s Trust.

DISCUSSION

State Street seeks dismissal of Feuerman’s counterclaims pursuant to G.L.c. 231, §59H, asserting that his counterclaims are premised solely upon State Street’s exercise of its rights to petition to the court for redress of Feuerman’s breach of contract. Feuerman contends that this statute does not apply to the circumstances of this case.

Commonly known as the anti-SLAPP statute,2 G.L.c. 231, §59H was enacted in response to an increase in meritless actions brought primarily to discourage a parly’s valid exercise of its constitutional rights of freedom of speech and petition for the redress of grievances. Duracraft Corp. v. Holmes Products Corp., 427 Mass. 156, 161 (1998). Discussing the purpose of the statute, the Supreme Judicial Court stated that “(t]he typical mischief that the legislation intended to remedy was lawsuits directed at individual citizens of modest means for speaking publicly against development projects.” Id.3 The Court further explained that SLAPP suits target people for “reporting violations of law, writing to government officials, attending public hearings, testifying before government bodies, circulating petitions for signature, lobbying for legislation, campaigning in initiative or referendum elections, filing agency protests or appeals, being parties in law reform lawsuits, and engaging in peaceful boycotts and demonstrations." Id., quoting Pring, SLAPPs: Lawsuits Against Public Participation, 7 Pace Envtl.L.Rev. 3, 5-6, 9 (1989). None of these situations are present in this case.

The anti-SLAPP statute permits a party to bring a special motion to dismiss in a case where the nonmov-ing party asserts civil claims, counterclaims, or cross claims “based on” the moving party’s “right of petition under the constitution of the United States or of the commonwealth.” G.L.c. 231, §59H. Although the Legislature intended to enact broad protection for petitioning activities, not all suits are subject to the statute. Duracraft Corp., 427 Mass. at 162.

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Bluebook (online)
11 Mass. L. Rptr. 191, Counsel Stack Legal Research, https://law.counselstack.com/opinion/state-street-corp-v-barr-masssuperct-2000.