While Rules 4.1(a) and 8.4(c) of the Massachusetts Rules of Professional Conduct prohibit attorneys from making false statements to third parties and/or engaging in conduct that is dishonest, fraudulent or involves misrepresentations, attorneys (and/or their agents) can use deception to act as “testers” to determine, for instance, if people are engaging in discriminatory or other illegal conduct. Nevertheless, as the plaintiff’s attorneys in Leysock v. Forest Laboratories, Inc. recently found out, getting creative in seeking to dupe people into providing information to bolster a claim can come back to bite you – hard.

In Leysock, the plaintiff’s attorneys at Milberg LLP “engaged in an elaborate scheme of deceptive conduct in order to obtain information from physicians about their prescribing practices.” They did this to garner evidence for a qui tam action they wanted to pursue. More specifically, the attorneys hired a doctor to pretend that he was conducting research through online surveys submitted to other physicians, without disclosing that the information gathered would be used to bolster the allegations in a complaint.

After the defendants learned about this, they moved for sanctions and sought dismissal because the allegations in the Complaint hinged on information that had been culled … Keep reading

In a recent decision, the Massachusetts Supreme Judicial Court has made it clear that employers cannot take action against employees who lawfully use medical marijuana, as doing so is tantamount to denying a request for a reasonable accommodation under the Commonwealth’s disability discrimination laws.

In Barbuto v. Advantage Sales and Marketing, LLC, the SJC reversed the dismissal of an employee’s handicap discrimination claim, alleging that her employer terminated her because of her lawful medical use of marijuana, and failed to engage in an interactive process to discuss a reasonable accommodation of her handicap. The employee had failed her employer’s drug test because of her use of marijuana, which was prescribed to treat her Crohn’s disease.

Interestingly, the SJC rejected the employer’s defense that the use of medical marijuana in the workplace is not a facially unreasonable accommodation simply because such use still is a crime under federal law. To the contrary, the SJC ruled that, under Massachusetts law, no person shall be denied “any right or privilege” on the basis of her medical marijuana use, even if such use may constitute a federal crime.

Thus, for an employee who has a qualified handicap under the disability discrimination laws, … Keep reading

When two parties reside and/or conduct business in different states, any agreement between them almost always has a choice of law provision. Typically, such a clause is as simple as: “The Parties agree that this Contract shall be governed and construed in accordance with the laws of the Commonwealth of Massachusetts.” As the Superior Court held earlier this month in Oxford Global Resources, LLC v. Hernandez, however, such simple and straight-forward language is no guaranty that a court will abide by it.

Oxford is a Delaware corporation and claims to have its principal place of business in Beverly, Massachusetts. Jeremy Hernandez is a California resident and was hired by Oxford to work in the company’s California office. As part of the hiring process, Hernandez was required to sign Oxford’s Protective Covenants Agreement, which included (i) non-compete and non-solicitation covenants; and (ii) a provision stating that the Agreement was governed by Massachusetts law.

Oxford later brought suit against Hernandez, alleging that he breached the Agreement by using information regarding Oxford’s customers to solicit them on behalf of a competitor. Hernandez countered by moving to dismiss, and, in that connection, he argued that the Court should construe the Agreement in … Keep reading

In this installment of The In-House Advisor, we interview Mark Bowers, Division Counsel and Senior Director at Samsung Pay, Inc., Samsung Pay is a mobile payment and digital wallet service that enables users to make payments using Samsung phones and other mobile devices. Mark’s role involves overseeing all of Samsung Pay’s legal needs, including contracts, compliance, litigation, HR support, real estate, management of the IP portfolio, marketing, product development, among other things.

The In-House Advisor: The role of in-house counsel has changed a lot over the years. How do you see that role changing going forward and how can today’s in-house counsel prepare for those changes?

Mark Bowers: The more things change; the more things stay the same.  While underlying technology and methods of communication have changed, the role of in-house counsel has largely remained the same. We are here to provide cost-effective and timely legal support while mitigating the overall risk profile for the company.

IHA: While in-house counsel routinely save their companies money, Legal Departments generally are viewed as cost centers that add nothing to the bottom line. How can in-house counsel get across to the business people the value that in-house lawyers add … Keep reading

No doubt, having a properly drafted agreement is critical if you wish to prevent a former employee from competing against you or soliciting your customers. But, simply having a clear and straight-forward agreement may not be enough to persuade a court to enjoin someone from violating the terms of it. Rather, a plaintiff must show that a post-employment restrictive covenant is necessary to protect “legitimate business interests” before any injunctive relief will issue. Further, and as the Superior Court reconfirmed earlier this month in ABM Industry Groups, LLC v. Palmarozzo, making such a showing is not always easy to do.

Joseph Palmarozzo was a branch manager for ABM Industry Group, a large, public company that provides janitorial and maintenance services to large facilities. In connection with his job, Palmarozzo entered into an employment agreement that included non-competition, non-solicitation and non-disclosure obligations.

In December of 2016, Palmarozzo left ABM to become the General Manager of Compass Facility Services (“CFS”), a much smaller company than ABM, but one that also provided janitorial services. Shortly thereafter, ABM filed suit and moved for a preliminary injunction to prevent Palmarozzo from competing against ABM and soliciting its customers.

As a prelude to its

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It is standard practice in M&A transactions for the acquired business to assign all if its contractual rights to the purchaser. While that may sound good in theory, depending upon how the underlying contracts are drafted, they could have little or no value to the purchaser. Indeed, as the Massachusetts Superior Court’s decision in NetScout, Inc. v. Hohenstein confirms, this warning can be particularly important when the underlying contract involves an employee non-compete.

Carl Hohenstein was employed by a subsidiary of Danaher Corporation, and in 2011 he and Danaher entered into a contract that included a non-compete agreement. Four years later, NetScout acquired Danaher and its subsidiaries, and as part of that transaction (i) Hohenstein became a NetScout employee; and (ii) Danaher assigned its rights under the 2011 contract with Hohenstein to NetScout. Six years after that, Hohenstein left NetScout and began working for one of its competitors.

NetScout sued Hohenstein and moved for a preliminary injunction, asking the Court to bar him from competing against the company. While the Superior Court found that the non-compete agreement in the 2011 contract between Hohenstein and Danaher was enforceable, and that NetScout was entitled to enforce that contract as Danaher’s assignee, … Keep reading

Next to a person’s Fifth Amendment right to remain silent, the attorney-client privilege is probably the most well recognized legal doctrine out there. Nevertheless, there are many nuances surrounding the privilege about which even seasoned lawyers are not very familiar. One of these deals with the fact that not all private communication between an attorney and client are privileged – even when the communications involve the most confidential and sensitive information.

In order to understand why and how to handle situations where an attorney-client communication may not be privileged, let’s first look at the basics: the attorney-client privilege is a rule of law that protects from disclosure private communications between an attorney and client that are for the purpose of giving or receiving legal advice. As such, communications with an attorney that seek business advice are not privileged. Further, because so many in-house attorneys routinely provide both business and legal advice, it is critically important that they educate their business colleagues about this, or problems can arise.

Take this example, which really happened to one of my in-house clients a few years ago. As a meeting amongst a group of business executives was about to begin, the CEO

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When Massachusetts voters legalized the use of marijuana for medicinal purposes four years ago, the impact on most employers was limited to clarifying that “legal” marijuana use was still generally prohibited in the workplace. Now, Massachusetts has legalized limited use of recreational marijuana. Although the recreational marijuana use law also provides that employers may prohibit employees from reporting to work or performing work under the influence of marijuana, the new law is raising practical challenges for employers. Here are three ways that employers may consider changing what they have been doing:

1. Pre-employment Drug Testing

Many employers require job candidates to successfully pass a drug test as a condition to receiving a job offer. Prior to the legalization of marijuana, a positive test for marijuana use by a job candidate was an indication of illegal drug use and clear grounds for rescinding an offer of employment. Since legalization of medical and recreational use, from a legal standpoint, rescinding a job offer based on testing positive for marijuana use is still generally permitted. From a practical standpoint, however, the rationale that marijuana use is illegal no longer exists and brings into question the rationale for drug testing for marijuana at … Keep reading

When entering into a new venture, it is not uncommon for a new legal entity to be formed in order to insulate an existing company from the liabilities associated with the new business. While the law absolutely permits this, a recent case in the Bankruptcy Court, In Re Cameron Construction & Roofing, is a good reminder that achieving true insulation requires more than simply filing another set of Articles of Incorporation.In 2000, Cameron Construction & Roofing, Inc. (“Inc.”) was formed by Wilfred Cameron, who was the corporation’s President, Treasurer, Clerk and sole Director. Two years later, Mr. Cameron formed Cameron Construction LLC (“LLC”), and he was named its Managing Member. Further, Mr. Cameron owned 99.9% of the equity in LLC, with the remaining 0.1% being held by Inc.By 2014, Inc. had become insolvent, and it filed a Chapter 7 Bankruptcy Petition. A Trustee was appointed to marshal and distribute Inc.’s assets, and LLC was joined as a defendant in the bankruptcy proceeding. Specifically, the Trustee sought to have the Court rule that assets of LLC could be used to satisfy the debts of Inc. LLC objected to this, arguing, that it was undisputed that the two … Keep reading

It generally is a defense to a breach of contract claim if the defendant proves that the plaintiff was the first one to materially breach the parties’ agreement. As a recent case from the Business Litigation Session of the Massachusetts Superior Court confirms, however, a plaintiff seeking to enforce a post-employment restrictive covenant can avoid falling victim to such a defense – if, that is, the company has a carefully crafted agreement is in place.… Keep reading