Communications between attorneys and clients that are not private, and/or communications between attorneys and third parties, cannot be protected from disclosure by the attorney-client privilege. When the client is an individual, it generally is easy to discern if a communication is private, and it usually is obvious if an attorney is communicating with a third party. When the client is a corporation or some other entity, however, it can be much less clear as to whether a particular person will be deemed to be the client or a third party. One scenario where this issue routinely arises is when company counsel communicates with an individual who is an independent contractor or some other person working closely with the company, but who is not an employee.… Keep reading
Under the Massachusetts Weekly Payment of Wages Act (“Wage Act”), the President, Treasurer and “any officers or agents having the management of such corporation” are considered to be employers and are subject to individual liability for failing to comply with its requirement. In a previous blog post, Managers of LLCs Can Be Personally Liable Under the Massachusetts Wage Act, I had written about Cook v. Patient Edu, LLC, where the Massachusetts Supreme Judicial Court clarified that managers of limited liability companies (not just the officers of a corporation) could be held individually liable under the Wage Act. In Cook, the SJC concluded that it did not matter whether the entity was a limited liability company or corporation, and determined that “individuals with the authority to shape the employment and financial policies of an entity [were] liable for the obligations of that entity to its employees.”
In a recent unpublished decision, Segal v. Genitrix, LLC, the Massachusetts Appeals Court, relying on Cook, appears to have expanded the scope of individual liability under the Wage Act to certain equity holders of limited liability companies.
ATP Tour, Inc. is a Delaware membership corporation that operates as the governing body for the major (and some minor) men’s professional tennis circuits. (A “membership” corporation does not have stockholders like a traditional corporation and often is the corporate form of choice for non-profits, although for profit companies can be membership corporations, as well.) In the early 1990’s, ATP adopted a bylaw stating that:
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In the event that (i) any [current or prior member or Owner or anyone on their behalf (“Claiming Party”)] initiates or asserts any [claim or counterclaim (“Claim”)] or joins, offers substantial assistance to or has a direct financial interest in any Claim against the League or any member or Owner (including any Claim purportedly filed on behalf of the League or any member), and (ii) the Claiming Party (or the third party that received substantial assistance from the Claiming Party or in whose Claim the Claiming Party had a direct financial interest) does not obtain a judgment on the merits that substantially achieves, in substance and amount, the full remedy sought, then each Claiming Party shall be obligated jointly and severally to reimburse the League and any such member or Owners for all fees,