137
&20021:($/7+ 2) 0$66$&+86(776 6835(0( -8',&,$/ &2857 12 6-& $8720,/( +2/',1*6 //& et al., 3ODLQWLIIV$SSHOOHHV Y 0$77+(: 0&*29(51 DQG 0&*29(51 $872 *5283 &253 6(59,&(6 ,1& 'HIHQGDQWV$SSHOODQWV 21 $33($/ )520 $ -8'*0(17 2) 7+( 68))2/. 683(5,25 &2857 %86,1(66 /,7,*$7,21 6(66,21 &$ 12 &9 %5,() 2) $33(//$176 0$77+(: 0&*29(51 $1' 0&*29(51 $872 *5283 &253 6(59,&(6 ,1& REDACTED %HQMDPLQ 0 0F*RYHUQ 1R 'DYLG - 6DQWHXVDQLR 1R 5REHUW 0 6KDZ 1R +2//$1' .1,*+7 //3 6DLQW -DPHV $YH %RVWRQ 0$ 7HO 'DWH )HEUXDU\ Supreme Judicial Court for the Commonwealth Full Court: SJC-12740 Filed: 5/20/2019 5:36 PM

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Page 1: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

et al.,

REDACTED

Supreme Judicial Court for the Commonwealth Full Court: SJC-12740 Filed: 5/20/2019 5:36 PM

Page 2: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv
Page 3: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

ALLSTAINLESS

All Stainless

Page 4: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

Wells

Page 5: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

A-Copy, Inc. v. Michaleson

Alexander & Alexander, Inc. v. Danahy

All Stainless, Inc. v. Colby

Atlantech, Inc. v. Am. Panel Corp.

Boulanger v. Dunkin’ Donutspassim

Chan v. Chen

EMC Corp. (“EMC”) v. Arturipassim

EMC Corp. v. Arturi

Felix A. Marino Co., Inc. v. Anderson

Hill Med. Corp. v. Wycoff

Kroeger v. Stop & Shop Cos., Inc.

Lightlab Imaging v. Axsun and Technologies Inc.

Makrigiannis v. Nintendo of Am.

Page 6: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

McFarland v. Scheider

Middlesex Neurological Assocs., Inc. v. Cohen

Nat’l Hearing Aid Ctrs., Inc. v. Avers

New England Canteen Serv., Inc. v. Ashley

Oxford Global Resources, LLC v. Hernandez

Perroncello v. Donahue

Rohm and Haas Elec. Materials, LLC v. Elec. Circuits Supplies, Inc.

Shiel v. Rowell

TAL Fin. Corp. v. CSC Consulting, Inc.

Tobin v. Cody

U.S. Bank Nat’l Ass’n v. Schumacher

Wells v. Wellspassim

Whitinsville Plaza, Inc. v. Kotseas

Page 7: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv
Page 8: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv
Page 9: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv
Page 10: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

infra

Id.

A:[Volume Number].[Page Number(s)]

Page 11: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv
Page 12: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

Add.[Page Number]

Page 13: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

Id

Page 14: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

Id.

Page 15: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

i.e.,

Page 16: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv
Page 17: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv
Page 18: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

supra

i.e.,

Id

Page 19: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv
Page 20: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv
Page 21: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv
Page 22: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

Id

Page 23: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv
Page 24: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

See infra.

Page 25: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

See infra.

See

infra

See Makrigiannis v. Nintendo of Am.

Page 26: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

see U.S. Bank Nat’l Ass’n

v. Schumacher

See Chan v. Chen

de novo

See EMC Corp. (“EMC”) v. Arturi

Id.

Page 27: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

All Stainless, Inc. v. Colby

See

Id.

Id.

See id.

All-Stainless

Page 28: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

Id. see also id.

All Stainless

Felix A. Marino Co., Inc.

v. Anderson

See

Middlesex Neurological Assocs.,

Inc. v. Cohen

See

Boulanger v. Dunkin’ Donuts

Page 29: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

All Stainless

A-Copy, Inc. v. Michaleson

All Stainless

see also id.

EMC Corp. v. Arturi

A-Copy

Seeaccord Nat’l Hearing Aid Ctrs., Inc. v. Avers

Page 30: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

See EMC

All Stainless

EMC

All Stainless EMC

See

Page 31: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

See EMC

All Stainless

All Stainless

All Stainless

Lightlab Imaging

See

Page 32: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

See id.

Id.

Lightlab Imaging

All Stainless

Lightlab Imaging

All Stainless. See Shiel v. Rowell

All Stainless

Page 33: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

See All-Stainless, Inc.

see also EMC

A-Copy All Stainless....

infra

All Stainless

TAL Fin. Corp. v. CSC Consulting, Inc.

All Stainless

Page 34: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

See A-Copy, Inc. All Stainless

EMC Corp.

EMC

See

Page 35: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

See New England

Canteen Serv., Inc. v. Ashley

Atlantech, Inc. v.

Am. Panel Corp. citing to Sanford v.

Boston Edison Co.

See

Page 36: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

Id

Page 37: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

See Perroncello v. Donahue

Id.

Page 38: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

See Boulanger v. Dunkin’ Donuts

New England Canteen Service

Page 39: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

see also Oxford Global Resources, LLC v. Hernandez

See New England Canteen Servs., Inc.

see also Whitinsville Plaza, Inc. v. Kotseas

Page 40: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

New England Canteen Service

Page 41: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

Boulanger see also New England Canteen

Serv., Inc.

Page 42: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv
Page 43: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

See, e.g., Kroeger v. Stop & Shop Cos., Inc.

i.e.

Page 44: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

See Rohm and Haas Elec. Materials, LLC v. Elec. Circuits Supplies,

Inc.

Wells

Wells v. Wells

Wells

Wells

Page 45: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

Boulanger

See Boulanger

Id.

Id.

Boulanger

See

also McFarland v. Scheider

Wells

Page 46: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

See

Wells

Wells

Wells

See Alexander & Alexander, Inc. v.

Danahy see also Wells

Page 47: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

Wells

Page 48: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

See, e.g., Alexander & Alexander, Inc.

Page 49: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

Wells

arguendo

Wells

See Boulanger

See e,g. Hill Med. Corp. v. Wycoff

see also Tobin v. Cody

Page 50: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

Id. Wells

Page 51: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

Compare Boulanger

Page 53: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv
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et al.,

Add.001

Page 55: McG Appeal Brief and Addendum FINAL IMPOUNDED · 5/29/2019  · ,1752'8&7,21 7klv dsshdo suhvhqwv ixqgdphqwdo txhvwlrqv uhjduglqj wkh vfrsh ri wkh 6xshulru &rxuw¶v htxlwdeoh srzhuv

FELIX A. MARINO CO., INC. V. ANDERSON

EMC CORP. V. ARTURI

MCFARLAND V. SCHNEIDER

Add.002

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Add.003

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Add.004

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P a g e | 1

Volume I Pages: 1-20

Exhibits: 0

COMMONWEALTH OF MASSACHUSETTS

SUFFOLK, SS. SUPERIOR COURT DEPARTMENT OF THE TRIAL COURT *******************************AUTOMILE HOLDINGS, LLC, ET AL * Plaintiff * v. * DOCKET NUMBER 1784CV03809 * MATTHEW MCGOVERN, ET AL * Defendant * *******************************

HEARING - FINDINGS OF FACT BEFORE THE HONORABLE MITCHELL H. KAPLAN

Boston, Massachusetts June 28, 2018

Recording produced by digital audio recording system. Transcript produced by Approved Court Transcriber, Donna Holmes Dominguez

Add.005

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P a g e | 2

I N D E X

WITNESS DIRECT CROSS REDIRECT RECROSS

None - Hearing

Add.006

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P a g e | 3

P R O C E E D I N G S1

(Court called to order.) 2

COURT OFFICER: Court, all rise. 3

Honorable Court is open. 4

Please be seated. 5

THE CLERK: Civil Action Number 2017-3809, Automile 6

Holdings against Matthew McGovern. 7

THE COURT: All right. 8

Welcome everyone. 9

Unfortunately, I'm losing my voice, so hopefully I will 10

get through this proceeding.11

Let me give each of the parties a revised version of the 12

verdict form that corrects that error that I had in the form 13

yesterday.14

All right. 15

So in this case, the Court ordered the trial of the 16

merits of so much of the plaintiff’s complaint as requested 17

injunctive relief advance and consolidated with the 18

plaintiff’s application for a preliminary injunction pursuant 19

to Massachusetts Rules of Civil Procedure 65B2.20

The parties thereafter waived detailed findings of fact 21

and rulings of law pursuant to Superior Court Rule 22H and 22

Standing Order 1-17. 23

The case was then tried over parts of three days from 24

June 20, 2018, through June 22, 2018. 25

Add.007

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P a g e | 4

In consideration of the testimony of the witnesses, the 1

Exhibits entered in evidence, and the parties’ post trial 2

submissions and argument, the Court answers the following 3

special questions. 4

With respect to its decision whether to grant equitable 5

relief, the written answer to the special question will be 6

supplemented with an oral explanation of the Court’s reasoning 7

which will be transcribed and become a part of this verdict. 8

Turning to the questions themselves, first question asks, 9

did plaintiff prove by a preponderance of the evidence that 10

the agreement dated February 8, 2017, between Prime on the one 11

hand and McGovern Motors on the other is a binding contract? 12

And the Court answers that question yes. 13

Two, did Prime prove by a preponderance of the -- of the 14

evidence that McGovern Motors breached the 2017 agreement by 15

hiring Timothy Fallows? 16

And the Court answers that question yes. 17

Did Prime prove by a preponderance of the evidence that 18

McGovern Motors breached the 2017 agreement by hiring James 19

Tully?20

The Court answers that question yes. 21

Four, did Prime prove by a preponderance of the evidence 22

that McGovern Motors breached the 2017 agreement by 23

encouraging Zachary Casey to leave his employment with Prime?24

The Court answers that question yes. 25

Add.008

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P a g e | 5

Five, did Prime prove by a preponderance of the evidence 1

that McGovern Motors breached the 2017 agreement by employing 2

Zachary Casey as the general manager of Nashua Toyota?3

And the Court answers that question yes. 4

Turning then to the questions about whether equitable 5

relief will enter. 6

Should specific performance or other equitable relief 7

enter against McGovern Motors with respect to Timothy Fallows? 8

Court answer that question no. 9

Briefly stated, Mr. Fallows did not seem to be a 10

particularly valued employee while he was working for Prime 11

Motors. He left there, and the circumstances of his leaving 12

aren't entirely clear. 13

He went to work for a Chevrolet dealership. He left 14

there. Went to work for a Volkswagen dealership, lost his job 15

there, was unemployed. Mr. McGovern gave him employment. 16

The Court finds that there’s no significant or valid 17

business interest of Prime that would be advanced by entering 18

any injunctive relief with respect to Mr. Fallows. 19

Seven, should specific performance or other equitable 20

relief enter against McGovern Motors with respect to James 21

Tully?22

The Court answers again no. 23

It seems clear that Prime didn't consider Mr. Tully to be 24

a valued employee, that it was uninterested in pursuing the 25

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P a g e | 6

line of business that Mr. Tully was interested in pursuing, I 1

believe that Mr. Tully was overpaid for what he was then 2

doing, and was, as Mr. Rosenberg testified, happy to have him 3

leave Prime. 4

Under those circumstances, no legitimate business purpose 5

would be advanced by entering any injunctive relief with 6

respect to Mr. Tully. 7

Indeed, Mr. Tully’s not even engaged in the sale of 8

automobiles at McGovern Motors. He’s dealing with physical 9

plant issues. 10

Eight, should specific performance or other equitable 11

relief enter against McGovern Motors with respect to Zachary 12

Casey?13

And the Court answers that question no, but the analysis 14

that leads me to determine that it won't enter equitable 15

relief with respect to Mr. Casey is complex. 16

So as noted, a breach of contract has occurred with 17

respect to both the solicitation of Mr. Kelly, that is his 18

encouragement to leave the employ of Prime as well as then 19

employing him as the general manager of Toyota of Nashua. 20

In determining whether or not to enter equitable relief, 21

the Court looks to General Laws Chapter 214, Section 1 that 22

deals with specific performance of a contract. There, the 23

legislature has stated the fact that the plaintiff has a 24

remedy in damages shall not be a bar -- shall not bar an 25

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action for specific performance of a contract if the Court 1

finds that no other existing remedy or the damages recoverable 2

thereby is in fact the equivalent of -- of the performance 3

promised by the contract, relied on by the plaintiff and the 4

Court may order specific performance if it finds such a remedy 5

to be practicable. 6

Therein lies the issue with respect to this case. 7

To the extent the clause that we’re dealing with here is 8

one that is a covenant not to compete, and I'm not sure that 9

that that actually is what we’re talking about, the Court does 10

note that under New England Canteen Service v. Ashley, 372 11

Mass 60 -- 661, the SJC has specifically told us that the 12

enforcements of covenants not to compete are the equivalent of 13

specifically enforcing a contract.14

That which the plaintiff seeks to enforce is paragraph 1A 15

of what we’ve referred to as the 27 -- 2017 agreement. That 16

is entitled, no solicit and no hire. And it precludes for a 17

period of eighteen months McGovern Motors from hiring any of 18

Prime’s employees or -- or encouraging them to leave the 19

employ of Prime.20

Strictly speaking, that’s not a covenant not to compete. 21

Rather, it’s what is often referred to as an anti-raiding 22

provision. It prevents hiring or encouraging employees of 23

Prime to leave.24

The problem is, that as it relates to Mr. Casey, that’s 25

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already happened. I am not able to return the parties to the 1

status quo ante before the encouragement to leave occurred. 2

An anti-raiding provision is intended to protect the 3

buyer of a business or an interest in a business, which is 4

what happened in this case, from losing key employees. 5

Now, McGovern Motors has argued that that’s not a 6

protectable business interest. 7

I think clearly that it is, and -- and finding -- and so 8

ruling on that, I rely on Wells v. Wells, 9 Mass App Court, 9

321, where the Appeals Court stated, “In the buyer seller 10

context, restrictions are not rendered unenforceable merely 11

because they protect an interest we might not recognize in any 12

employment setting. Unreasonableness in time, space, or 13

product line or obstruction of the public interest are the 14

principle bars to enforcement.” 15

You know, this is a -- this is a business interest that a 16

seller -- that a buyer of -- of an interest in a business 17

should be entitled to protect. 18

Nonetheless, because that clause is not protecting trade 19

secrets, confidential information, or good will, it’s very 20

hard to figure out what kind of injunctive relief could be 21

entered to protect this particular business interest after22

there’s been a breach of contract, that is after the 23

soliciting or the hiring has occurred. 24

Now, I do note that Mr. Casey was just the kind of 25

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employee that the anti-raiding provisions that had been 1

negotiated in the contract was designed to protect from 2

solicitation by Mr. McGovern. He had rapidly risen through 3

the ranks of -- of Prime Motors, Prime Motors had spent a 4

considerable sum sending him to school so that he could learn 5

how to be a general manager of an automobile dealership, and 6

when solicited, he was in fact managing three automobile 7

dealerships in Maine. 8

However, Mr. Casey wasn’t subject to any kind of non-9

compete, and he was free to work for any competitor. 10

Mr. Casey’s not a defendant in this proceeding. Mr. 11

Casey’s already moved to New Hampshire, sold his house, 12

presumably he’s entered his kids in school in New Hampshire.13

There’s no way that the Court can order Mr. Casey’s 14

relationship with Prime to be repaired. It is simply too late 15

to enjoin McGovern Motors from soliciting Casey or hiring 16

Casey. All it could do at this point effectively would be to 17

order that Mr. Casey be terminated, that is fired.18

Terminating Casey wouldn't provide a benefit to Prime, 19

not prevent Prime from suffering any further damage from 20

having lost a valued employee. It would serve as a punishment 21

to McGovern Motors, but it would also serve as a punishment, 22

and a more severe punishment, it seems to me, to Mr. Casey, 23

not a defendant in this action. 24

Additionally, for how long would the injunction last? 25

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P a g e | 10

The 18 month period of the non-solicit in the 2017 agreement 1

is going to expire on August 8th, enjoining Casey from working 2

for another six weeks seems to make no sense at all under the 3

set of circumstances. 4

Again, it would serve as a punishment or penalty but not 5

of any benefit to Prime. 6

Could the August 8th date be continued? Perhaps. I’ll 7

address that in a moment. 8

But until when? 9

Also, the likelihood that Casey would be able to return 10

to the general manager position in Toyota after a lengthy 11

period in which he was unable to work seems unlikely and that 12

would be a further penalty to Casey. 13

As this is -- as in determining whether or not to enter 14

injunctive relief, the Court is acting as a Court in equity. 15

It finds that inflicting a benefit upon a -- excuse me -- 16

inflicting a penalty upon a defendant without a -- a con -- a 17

returning benefit to the plaintiff is inappropriate, and -- 18

and to repeat, while depriving McGovern Motors, could in some 19

sense be said to be equitable under the circumstances of this 20

case, that’s not the purpose of entering injunctive relief.21

The purpose of entering injunctive relief is to prevent 22

further injury to the plaintiff. 23

And an injunction with respect to Mr. Casey’s continued 24

employment would not resound in any benefit to Prime Motors.25

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P a g e | 11

I do point out that if Prime is able to establish that it 1

suffered any damages as a result of the breach of contract as 2

it relates to Mr. Casey, then it would be entitled to monetary 3

relief.4

So the last question on the verdict form is whether other 5

equitable relief should be entered against McGovern Motors by 6

reason of the various breaches of the 2017 agreement. 7

And the Court answers this question yes. 8

And I think this requires some further discussion. 9

Cases that distinguish between the enforceability of 10

covenants not to compete or covenants like the present one 11

which is an anti-raiding covenant, are addressed differently 12

when they arise in the connection of a sale of a business or 13

an interest in a business.14

As the SJC has pointed out in Belanger v. Dunkin Donuts 15

Incorporated, 442 Mass 635. 16

In the context of the sale of a business, Courts look 17

less critically at covenants not to compete because they do 18

not implicate an individual’s right to employment to the same 19

degree as in the employment context. 20

Moreover, in the context of a sale of a business, Courts 21

are less concerned with unequal bargaining power between the 22

parties, rather the Courts consider whether the parties 23

entered into the agreement with the assistance of counsel and 24

without compulsion, an element frequently not present in the25

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P a g e | 12

-- an element frequently not present in the employer-employee 1

context.2

So equal bargaining power is something that the Court 3

should consider in determining whether to enter equitable 4

relief as it relates to Mr. McGovern’s position vis-a-vis 5

Prime.6

I'm not sure that in this case, the analogy to instances 7

in which a sale of a business or a part of a business has been 8

discussed in existing case law is exactly on point. 9

Based on the evidence presented at trial, it’s my 10

understanding that disagreements between Mr. McGovern and Mr. 11

Rosenberg arose while Mr. Rosenberg, a majority owner of 12

Prime, Abrams, and Mr. McGovern were looking to sell Prime.13

It -- it should be noted that at -- at this point, Mr. 14

McGovern had a -- a 7.8 percent interest -- ownership interest 15

in Prime and Prime’s real estate which was only slightly less 16

than Mr. Rosenberg’s interest in Prime. 17

However, Mr. Rosenberg, combined with the majority owner 18

Abram’s capital and together they decided that Prime should 19

terminate Mr. McGovern’s employment with Prime. 20

As the Supreme Judicial Court has expressed in Manor 21

Nursing Home and its progeny, frequently with respect to 22

closely held corporations, the only way in which an owner of 23

an interest in a closely held corporation can receive a return 24

on his or her investment is through continued employment with 25

Add.016

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P a g e | 13

the corporation. 1

Abrams, in connection with Rosenberg, terminated Mr. 2

McGovern’s employment in February of 2016 after these disputes 3

arose in connection with efforts to -- to sell the business.4

It’s not clear what if any alternatives to discharge they 5

considered.6

So at that point, although Mr. McGovern had apparently 7

invested 3.9 million dollars in -- in Prime way back at the 8

time of the purchase of the assets of -- of Clair Motors, he 9

was at that point -- he had no right to sell his shares in the 10

business and no other opportunity for any kind of return in 11

investment.12

Ratcheting up the pressure on Mr. McGovern shortly after 13

he was terminated, Mr. Abrams and Rosenberg amended the Prime 14

operating agreement to remove the provision that provided for 15

distributions of profits by Prime to the owners of Prime 16

sufficient to cover their tax liability. They apparently did 17

this shortly before April 15, 2016 when Mr. McGovern would be 18

confronting a -- what I understand to be a 5 to 600,000 dollar 19

tax liability in respect of the 2015 tax year. 20

The Court will take judicial notice that provisions in 21

operating agreements that provide for under these kinds of 22

circumstances for distributions of sufficient funds to pay 23

taxes attributable to the ownership and the interest are -- 24

are commonplace, so the Court draws the inference that the 25

Add.017

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P a g e | 14

timing of this change in the operating agreement was intended 1

to -- to increase the pressure on Mr. McGovern.2

Rosenberg and Abrams also cut off access to Mr. 3

McGovern’s ability to look at the financial information of the 4

company. He couldn't even plan for what his tax obligations 5

would be for the 2016 year on that basis. They even demanded 6

that he and his wife return the cars that they had been using.7

So while Mr. McGovern was certainly represented by 8

counsel in connection with the negotiation of the re-purchase 9

agreement, and he was under no legal compulsion to sell his 10

interest in the company, certainly it seems that Mr. Rosenberg 11

and Mr. Abrams were doing what they could to increase the 12

pressure on Mr. McGovern to sell his interest and it seems 13

that the Court can draw the inference that they had -- they 14

were anxious to have Mr. McGovern sell his interest, because 15

they had, as they had in the past, I'm sure Mr. McGovern was 16

fully aware of this even without access to financial 17

information, that the parties had been looking -- that is the 18

owners of -- of Prime had been looking for a liquidity event, 19

and it seems a reasonable inference is that Rosenberg and 20

Abrams were interested in repurchasing Mr. McGovern’s interest 21

in Prime before that liquidity event occurred. 22

On the other hand, as noted previously, Mr. McGovern was 23

represented by counsel. The repurchase agreement went through 24

several drafts and he negotiated the best deal he could under 25

Add.018

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P a g e | 15

the circumstances.1

He was interested in getting cash, not only to pay for 2

his tax liability, but also he was in the process of starting 3

a competing business. 4

Also, in determining whether equitable relief should 5

enter, the Court finds it very significant that I'm -- that 6

it’s not being asked to specifically enforce the 2016 7

repurchase agreement. It’s being asked to enforce the 2017 8

agreement.9

That was an agreement that arose based upon Prime’s 10

contention that McGovern had been violating the 2016 11

agreement, and it seems undisputed that by the time the 2017 12

agreement had been entered into, McGovern actually had 13

employed at least 15 people who previously worked at -- at 14

Prime Motors. 15

I'm unable to determine whether he did so in violation of 16

the 2016 agreement, but he was represented by counsel. They 17

negotiated the specific terms of the 2017 agreement. He was 18

able to consider the likelihood that he would be -- he would 19

lose a lawsuit if a lawsuit was brought at that time, and I 20

think it’s significant that based on his knowledge of his own 21

conduct over the previous year, he voluntarily decided to 22

enter into the 2017 agreement which had the no solicitation, 23

no hire provision laid out in 1A of that agreement.24

In determining what manner of equitable relief the Court 25

Add.019

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P a g e | 16

ought enter under these circumstances, one of the things that 1

the Court has given consideration to is how to enter relief 2

that would actually serve as a benefit to Prime and not just a 3

penalty to McGovern and how to fashion relief that would in 4

some measure achieve for Prime what it bargained for in 5

paragraph 1A of the 2017 agreement. 6

Additionally, the Court has been struck by the evidence 7

that suggests that Mr. McGovern willfully ignored the 8

provisions of paragraph 1A and repeatedly hired people in a 9

manner that he knew would be a violation of that agreement.10

Further, it appears that when a previous motion for 11

preliminary injunction was denied in December 2017, albeit 12

with respect to an individual that -- hired by McGovern but 13

who had been fired by Prime, that McGovern became emboldened 14

in his willingness to ignore the contractual provisions that 15

he entered into. 16

In fashioning what the Court considers as equitable 17

relief under the circumstances, the Court also takes note that 18

when a renewed motion for preliminary injunction was filed by 19

Prime in January, McGovern submitted an affidavit to this 20

Court consider -- concerning his -- the sale of his interest 21

in Toyota of Nashua to Mr. Casey and what Mr. Casey’s position 22

was at that time in respect to that dealership which, to say 23

charitably, was less than candid. 24

Taking all of that in mind, the Court can -- has 25

Add.020

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P a g e | 17

determined that it will enter the following permanent 1

preliminary injunctive relief, that is as part of the final 2

judgment.3

It is decided -- the Court has decided that although the 4

law is less than clear concerning the Court’s ability to do 5

this, that under the unique circumstances presented by this 6

case, that the Court has the authority to extend the -- the 7

restrictions set out in 1A of the 2017 agreement beyond the 8

expiration date of August 8th, 2019. 9

And so the Court will enter the following order. 10

It is going to extend the restrictions set out in 11

paragraph 1 of the 2017 agreement for an additional year to 12

August 8th, 2019. 13

The hiring or soliciting of any employee of prime during 14

this extended period ending on August 8, 2019, will under 15

these circumstances be a -- be found to be a contempt of an 16

order entered by this Court. 17

If such contumacious conduct were to occur -- were to 18

occur -- occur, the Court finds that it would be entitled to 19

issue monetary fines as a result of -- of those actions. 20

Indeed, the Court points out that, you know, even if some 21

individual fired by Prime were to show up on the doorstep of 22

McGovern, such individual could not be hired by McGovern 23

Motors. If he really wanted to hire that person, you could, 24

under the circumstances, come back to the Court and ask for 25

Add.021

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P a g e | 18

relief from this preliminary injunction. 1

So that is -- that is the order that will enter. 2

In this regard, the Court has, to some extent, relied 3

upon Lightlab Imaging v. Axsun and Technologies Inc., 469 Mass 4

181 at 194 where the Court talked about the broad discretion 5

of a Trial Judge to grant or deny injunctive relief. 6

I that particular instance, the -- the Court noted that a 7

permanent injunction should not be granted to prohibit acts 8

that there was no reasonable basis to fear will occur.9

Given the conduct engaged in by -- by -- in the past by 10

McGovern Motors, the Court finds that there is reason to 11

believe that there would be a further breaches of the 12

agreement, and for those reasons, it has decided to enter as a 13

final judgment on so much of the plaintiff’s complaint that 14

requests injunctive relief, a permanent injunction continuing 15

the prohibitions set out in paragraphs 1A and 1B of the 2017 16

agreement to August 8, 2019. 17

The Court will enter this as a final judgment under Rule 18

54B, so that if any party wants to, it will be immediately 19

appealable.20

I think that completes my decision on the matters 21

presented.22

I note on a going forward basis, if the parties wish to 23

continue the litigation with respect to damages, that the 24

findings of breach of contract are now res judicata in this 25

Add.022

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P a g e | 19

case, as -- having been incorporated in a final judgment. 1

Whether or not the parties wish to continue, whether or 2

not Prime is able to show that it actually suffered monetary 3

injury by these breaches of contract, those issues are for 4

another day.5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

(Adjourned)25

Add.023

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The Commonwealth of MassachusettsOFFICE OF COURT MANAGEMENT, Transcription Services

AUDIO ASSESSMENT FORM

For court transcribers: Complete this assessment form for each volume of transcript produced, and include it at the back of every original and copy transcript with the certificate page, word index, and CD PDF transcript.

TODAY’S DATE:_July 2, 2018 TRANSCRIBER NAME:_Donna H Dominguez

CASE NAME: Automile et al v McGovern et al CASE NUMBER:

RECORDING DATE June 28 2018 TRANSCRIPT VOLUME:_ 1_OF__ 1__

(circle one) TYPE: CD TAPE QUALITY: EXCELLENT GOOD FAIR POOR

(circle all that apply) ISSUES (include time stamp):

background noise time stamp:___________________________

low audio

low audio at sidebar

simultaneous speech __________

speaking away of microphone __________________

other:_______________ time stamp:____________________________

____________________ _____________________________________

____________________ _____________________________________

____________________ _____________________________________

COMMENTS:_

Add.024

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P a g e | 20

Certificate of Accuracy

I, Donna Holmes Dominguez, an Approved Court

Transcriber, do hereby certify that the foregoing is a true

and accurate transcript of the audio recording provided to me

by the Suffolk County Superior Court regarding proceedings in

the above-entitled matter.

I, Donna Holmes Dominguez, further certify that the

foregoing is in compliance with the Administrative Office of

the Trial Court Directive on Transcript Format.

I, Donna Holmes Dominguez, further certify that I

neither am counsel for, related to, nor employed by any of the

parties to the action in which this hearing was taken, and

further that I am not financially nor otherwise interested in

the outcome of the action.

________________________________________Donna Holmes Dominguez, ACT, CET Notary Public, Commission Expires 5-17-24

July 2, 2018 _______________ Date

(781) 575-8000___________________

[email protected]

Donna H. Dominguez

Digitally signed by Donna H. Dominguez Date: 2018.07.02 13:26:51 -04'00'

Add.025

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DH Reporting Services, Inc. (781) 575-8000

Add.026

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DH Reporting Services, Inc. (781) 575-8000

Add.027

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DH Reporting Services, Inc. (781) 575-8000

Add.028

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DH Reporting Services, Inc. (781) 575-8000

Add.029

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DH Reporting Services, Inc. (781) 575-8000

Add.030

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