Superior Court of Massachusetts, Suffolk, Business Litigation Session
FTI, LLC et al.
Robert J. Duffy et al
May 4, 2017
MEMORANDUM AND ORDER DENYING DEFENDANTS' MOTION
TO STAY THE PROCEEDING AND DENYING DEFENDANT FUHR'S
MOTION TO DISMISS FOR LACK OF PERSONAL JURISDICTION
Kenneth W. Salinger, Justice.
Robert Duffy, Stephen Coulombe, and Elliot Fuhr used to work
for FTI, LLC, or its parent FTI Consulting, LLC (collectively
" FTI"). These three defendants quit in May 2016 to
work for Berkeley Research Group (" BRG"). At
around the same time BRG and the individual defendants filed
suit in California seeking a declaration that these
individuals' non-competition agreements with FTI are void
and unenforceable and an injunction barring FTI from seeking
to enforce those covenants. FTI filed this Massachusetts
lawsuit five months later, in October 2016. FTI claims that:
(i) the individual defendants breached their non-competition,
non-solicitation, and confidentiality agreements; (ii)
Defendants each misappropriated trade secrets belonging to
FTI; (iii) the individual defendants breached fiduciary
duties by using FTI's resources and corporate
opportunities to help BRG compete with FTI; (iv) BRG aided
and abetted those alleged breaches of fiduciary duty; (v) all
Defendants tortiously interfered with advantageous
relationships FTI had with various third parties; and (vi)
BRG has engaged in unfair competition and unfair trade
four defendants have moved to stay this case pending final
resolution of the civil action they filed in California.
Separately, Mr. Fuhr has moved to dismiss the claims against
him for lack of personal jurisdiction.
Court will deny both motions. A stay would be inappropriate
because the California action concerns only part of a few
claims at issue here and because the California action is on
hold until the California Supreme Court decides whether that
case should be dismissed. This court can and should exercise
personal jurisdiction over Mr. Fuhr because this lawsuit
arises directly from Fuhr's constitutionally sufficient
contacts with Massachusetts and the exercise of jurisdiction
over Fuhr would be reasonable, fair, and just.
Motion to Stay Proceedings
trial judge has broad discretion to grant or deny a stay of
proceedings pending resolution of the same or similar claims
in another forum. Travenol Laboratories, Inc. v. Zotal,
Ltd., 394 Mass. 95, 97, 474 N.E.2d 1070 (1985).
Court concludes, in the exercise of its discretion, that
there is no good reason to stay this action until after final
resolution of the related California case. It will therefore
DENY Defendants' motion to stay.
First-Filed Rule and Exceptions
entirely duplicative lawsuits are filed in different
jurisdictions at materially different times, typically the
later-filed action is stayed pending final resolution of the
first-filed action. See, e.g., TPM Holdings, Inc. v.
Intra-Gold Industries, Inc., 91 F.3d 1, 4 (1st Cir.
this principle is often referred to as the first-filed or
first-to-file " rule, " a court has broad
discretion whether to apply it in any particular case. See,
e.g., Chavez v. Dole Food Company, Inc., 836 F.3d
205, 210 (3d Cir. 2016); Baatz v. Columbia Gas
Transmission, LLC, 814 F.3d 785, 793 (6th Cir. 2016).
" Exceptions to the rule are not rare, " and a
judge " has discretion to give preference to a
later-filed action when that action will better serve the
interests involved." EMC Corp. v. Parallel Iron,
LLC, 914 F.Supp.2d 125, 127 (D.Mass. 2012) (Saylor, J.);
accord, e.g., Blair v. Equifax Check Srvcs., Inc.,
181 F.3d 832, 838 (7th Cir. 1999).
two lawsuits overlap only in part, as in this case, the
judgment as to whether to stay the second-filed action must
take into account all the relevant circumstances, including
" the extent of overlap, the likelihood of conflict, the
comparative advantage and the interest of each forum in
resolving the dispute." TPM Holdings, supra .
And " where there is less overlap" between the two
actions, the second court " has considerably more
discretion" to decline to stay the second-filed action.
In re Telebrands Corp., 824 F.3d 982, 984 (Fed.Cir.
Analysis of Stay Issues
overlap between this action and the California lawsuit is
rather limited. The California action is concerned only with
the individual defendants' non-competition agreements and
nothing else. Whatever the end result of the California
action, it will not resolve FTI's claims in this case
that Defendants violated their non-solicitation and
confidentiality agreements, misappropriated trade secrets,
breached fiduciary duties (in the case of the individual
defendants) or aided and abetted others in doing so (in the
case of ...