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Ricci Consultants, Inc. v. Bournival

Appeals Court of Massachusetts

June 23, 2015

Ricci Consultants, Inc .
Linda L. Bournival (and a companion case [1] )

Editorial Note:

This decision has been referenced in an "Appeals Court of Massachusetts Summary Dispositions" table in the North Eastern Reporter. And pursuant to its rule 1:28, As Amended by 73 Mass.App.Ct. 1001 (2009) are primarily addressed to the parties and, therefore, may not fully address the facts of the case or the panel's decisional rationale. Moreover, rule 1:28 decisions are not circulated to the entire court and, therefore, represent only the views of the panel that decided the case. A summary decision pursuant to rule 1:28, issued after February 25, 2008, may be cited for its persuasive value but, because of the limitations noted above, not as binding precedent. See Chace v. Curran, 71 Mass.App.Ct. 258, 260 N.4, 881 N.E.2d 792 (2008).


These companion cases arose out of the acrimonious break-up of two actuaries. Following a six-day trial on the parties' competing tort claims, a jury found in favor of Linda L. Bournival and KMS Actuaries, LLC (KMS or collectively, the KMS parties) on one of their two intentional interference claims against Stephen J. Ricci and Ricci Consultants, Inc. (RCI or collectively, the Ricci parties). After receiving additional evidence, a judge rejected the parties' competing breach of fiduciary duty claims. Both sides filed timely cross appeals. We affirm in part and reverse in part.

1. KMS parties' intentional interference claims.

Answering special questions, the jury found that the Ricci parties improperly interfered with the KMS parties' " contractual and/or advantageous relationships" with the Stoneham Contributory Retirement Board (Stoneham).[2] After careful review of all the evidence under the appropriate standard, we conclude that the evidence was insufficient to support a reasonable inference of causation. The Ricci parties' motions for a directed verdict and for judgment notwithstanding the verdict should have been granted. See O'Brien v. Pearson, 449 Mass. 377, 383, 868 N.E.2d 118 (2007).

We summarize the meager evidence in the record potentially supportive of this essential element of the claim. On March 30, 2012, Bournival submitted a proposal and a proposed fee schedule on behalf of KMS to perform valuation work for Stoneham; Stoneham selected her for an interview; and during the interview, Stoneham presented her with one of the so-called " attack" letters sent by Stephen Ricci,[3] and asked questions about it; and thereafter KMS did not get the work.[4]

Bournival presented evidence that during her tenure at RCI, she attended approximately twenty-five interviews. The three interviews Bournival attended with Ricci for retirement system work resulted in one RCI contract. Following the other twenty-two interviews for retiree medical work, in which she interviewed alone or with a copartner from another firm, Bournival had " pretty significant success."

No similar statistical evidence was presented concerning Bournival's success rates at KMS. Moreover, no evidence was presented about the bidding process for the Stoneham job, including the number of bidders, the number of candidates interviewed, the amount of KMS's bid as compared to the winning bid, or the reasons given, if any, for Stoneham's rejection.[5] Bournival had no preexisting relationship with Stoneham that might have elevated her chances of success.[6] Finally, it was undisputed that a number of public entities entered into contractual relations with the KMS parties despite receiving one of the attack letters. In sum, the proof was insufficient to warrant a finding that the KMS parties, more probably than not, were harmed by Ricci's April 3, 2012, letter.[7] See Blackstone v. Cashman, 448 Mass. 255, 260, 860 N.E.2d 7 (2007); Dear v. Devaney, 83 Mass.App.Ct. 285, 294, 983 N.E.2d 240 (2013).

2. RCI's intentional interference claims.

In light of the evidence of RCI's abandonment of its existing contracts, the snippet of instruction objected to by RCI was a correct statement of the law. In the portion of the charge preceding the challenged fragment, the judge thoroughly instructed the jury on the principles of law governing shareholders in a close corporation. He also gave examples of how the duties owed to fellow shareholders and to the corporation might be breached. We discern no reversible error in the jury instructions. See Selmark Assocs., Inc. v. Ehrlich, 467 Mass. 525, 547, 5 N.E.3d 923 (2014).

3. RCI's conversion claim.

On appeal, RCI claims that the judge erroneously failed to rule on its conversion claim. In fact, the trial judge did issue a ruling, denying RCI's motion under Mass.R.Civ.P. 59(e), 365 Mass. 827 (1974), to amend the judgment in its favor on the conversion claim and to order Bournival to return the laptop. Beyond this factually incorrect statement, RCI offered nary a hint as to how the judge might have erred. We do not consider RCI's two-sentence appellate argument further. See Selmark Assocs., Inc. v. Ehrlich, 467 Mass. at 540.

4. Breach of fiduciary duty claims.

Shareholders in a close corporation, as in a partnership, owe each other the duty to act with the utmost good faith and loyalty. See Donahue v.Rodd Electrotype Co. of New England, 367 Mass. 578, 593, 328 N.E.2d 505 (1975). Their relationship " must be one of trust, confidence, and absolute loyalty." Selmark Assocs., Inc. v.Ehrlich, 467 Mass. at 536, quoting from Donahue v.Rodd Electrotype Co. of New England, 367 Mass. at 587. In discharging their management functions, shareholders " may not act out of avarice, expediency or self-interest in derogation of their duty of loyalty to the other stockholders and to the corporation." Donahue v.Rodd Electrotype Co. of New England, 367 Mass. at 593. The duty of loyalty requires shareholders, as fiduciaries, to " consider [their co-shareholders'] welfare, and refrain from acting for purely private gain." Meehan v.Shaughnessy, 404 Mass. 419, 434, 535 N.E.2d 1255 (1989). To satisfy the paramount duty of loyalty, the ...

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