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Supreme Judicial Court of Massachusetts
January 6, 2021, Argued; April 9, 2021, Decided
[**420] Wendlandt, J. Over the course of more than two decades representing clients in asbestos litigation, the plaintiff Governo Law Firm LLC (GLF) systematically created the contents of a research library, a treasure trove of materials amassed from GLF's own matters as well as other sources, that gave it a competitive edge in attracting and providing legal services to clients in this specialized field. GLF also built electronic databases to render the library readily searchable, facilitating retrieval of the information. In the fall of 2016, these proprietary [***2] materials were taken by a group of nonequity employees at GLF (attorney defendants) as they prepared to start a new law firm, the defendant CMBG3 Law LLC (CMBG3), in case their planned purchase of GLF proved unfruitful. The attorney defendants took turns secretly downloading the library and databases, as well as GLF's employee handbook, other administrative materials, and client lists, onto high-capacity “thumb drives”;2 the attorneys then surreptitiously removed these materials from GLF's offices. They subsequently made an offer to GLF's sole owner, David Governo, to buy GLF, stating that they would resign if the offer were not accepted that day. Governo rejected the offer that same day and locked the attorney defendants out of GLF's computer systems. The next day, the attorney defendants opened for business under the previously incorporated CMBG3, where they used the stolen materials and derived profits therefrom.
GLF filed a complaint in the Superior Court asserting claims against its former employees and CMBG3. A jury found some or all of the defendants liable on the [**421] claims for conversion, breach [*190] of the duty of loyalty, and conspiracy,3 and none of the defendants liable for unfair [***3] or deceptive trade practices in violation of G. L. c. 93A, § 11. The jury awarded GLF $900,000 in damages, calculated based on the defendants' net profits. The judge then issued a permanent injunction enjoining the defendants from using the library and databases, and ordering those materials removed from the defendants' computers.
In GLF's appeal from certain of the judge's instructions at trial, as well as his posttrial rulings, we first address the question whether the attorney defendants, who misappropriated proprietary materials from their employer during their employment, and subsequently used those materials to compete, may be liable for unfair or deceptive trade practices pursuant to G. L. c. 93A, § 11, for actions that were, in part, taken while still employed by GLF. We conclude that that they, and their new firm, may be. Because the judge erroneously instructed the jury that the defendants' preseparation conduct was not relevant to GLF's claim under G. L. c. 93A, § 11, and because GLF has shown that its rights were affected thereby, the matter must be remanded for a new trial on the G. L. c. 93A, § 11, claim. We next address the scope of the permanent injunction. Although the jury found that the defendants were liable for conversion of GLF's proprietary [***4] materials, the judge issued a permanent injunction precluding the defendants' use of only a subset of these materials. We conclude that the judge abused his discretion. Finally, we consider GLF's claims with respect to pre- and postjudgment interest. We conclude that prejudgment interest was not required under G. L. c. 231, § 6H, but that GLF is entitled to postjudgment interest.
Full case includes Shepard's, Headnotes, Legal Analytics from Lex Machina, and more.
487 Mass. 188 *; 166 N.E.3d 416 **; 2021 Mass. LEXIS 207 ***; 2021 WL 1324147
Governo Law Firm LLC vs. Kendra Ann Bergeron & others.1
Prior History: [***1] Suffolk. Civil action commenced in the Superior Court Department on December 27, 2016.
The case was tried before Kenneth W. Salinger, J., an amended judgment was entered by him, a motion to deposit funds into court to satisfy a money judgment was considered by him, and a motion to modify a permanent injunction was also considered by him.
The Supreme Judicial Court granted an application for direct appellate review.
Governo Law Firm, LLC v. CMBG3 Law, LLC, 2019 Mass. Super. LEXIS 488 (Mass. Super. Ct., Sept. 4, 2019)
prejudgment interest, defendants', damages, profits, postjudgment interest, copied, databases, files, permanent injunction, deposit, deceptive, unfair, funds, research library, monetary award, proprietary, asbestos, commerce, misappropriated, compensatory, compensate, conversion, employees, accrue
Civil Procedure, Appeals, Appellate Jurisdiction, Final Judgment Rule, Reviewability of Lower Court Decisions, Timing of Appeals, Notice of Appeal, Jury Trials, Jury Instructions, Objections, Antitrust & Trade Law, Regulated Practices, Private Actions, State Regulation, Consumer Protection, Deceptive & Unfair Trade Practices, Trade Practices & Unfair Competition, State Regulation, Scope, Labor & Employment Law, Employment Relationships, At Will Employment, Definition of Employees, Standards of Review, Abuse of Discretion, Remedies, Injunctions, Permanent Injunctions, Judicial Officers, Judges, Discretionary Powers, Preliminary Considerations, Equity, Relief, Evidence, Privileges, Trade Secrets, Damages, Compensatory Damages, Judgment Interest, Prejudgment Interest, Torts, Types of Damages, De Novo Review, Post Judgment Interest, Postjudgment Interest, Deposits in Court