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Kaufman v. Joseph

United States District Court, D. Massachusetts

June 1, 2017

ALAN M. KAUFMAN, Plaintiff,
v.
ANDREW JOSEPH, ET AL., Defendants.

          MEMORANDUM & ORDER

          Nathaniel M. Gorton United States District Judge.

         This case involves a long-running dispute concerning a business relationship between pro se plaintiff Alan Kaufman ("Kaufman" or "plaintiff") and defendants, Attorney Andrew Joseph ("Joseph"), his law firm, Drinker Biddle & Reath LLP ("DBR"), and Southwestern Bell Mobile Systems, LLC d/b/a Cingular Wireless n/k/a AT&T Mobility ("AT&T" and, collectively with Joseph and DBR, "defendants"). Plaintiff alleges that 1) DBR breached the covenant of good faith and fair dealing and all three defendants 2) defrauded the Court and 3) made fraudulent misrepresentations. Pending before the Court is defendants' joint motion to dismiss. For the following reasons, that motion will be allowed.

         I. Background

         A. Initial Business Relationship

         Kaufman apparently was the controlling officer of Harvard Cellular, Inc. (“Harvard Cellular”) between 1991 and 2002. In 2002, Harvard Cellular entered into an agency agreement with the predecessor-in-interest to New Cingular Wireless (“New Cingular”), a subsidiary of AT&T, to open five retail stores in New York City. New Cingular advanced $350, 000 to Harvard Cellular to lease and build properties for the New York City stores. Harvard Cellular's stores, which sold New Cingular products, opened that July.

         The agreement between Harvard Cellular and New Cingular required that Harvard Cellular obtain authorization from New Cingular before closing any of the stores. Without doing so, Harvard Cellular closed its New York City stores in December, 2002. It failed to reimburse New Cingular for the advance, building costs, the cost of handsets for which it had accepted delivery and other operating costs. New Cingular sought recovery of those expenses and the parties went to arbitration.

         B. Arbitration Decision

         Arbitration proceedings between Harvard Cellular and New Cingular lasted 13 days. During and after the arbitration, New Cingular was represented by attorneys from DBR, including Joseph. Kaufman alleges that Joseph began settlement negotiations with Harvard Cellular while the arbitration was ongoing because he did not expect New Cingular to succeed. Ultimately, the parties did not settle and the arbitrator ruled in favor of New Cingular, ordered Harvard Cellular to pay New Cingular $1.2 million for breaching its contractual obligations and denied Harvard Cellular's counterclaims for fraudulent inducement and breach of contract.

         C. New York and Florida Actions

         New Cingular filed suit in the New York Supreme Court to confirm the arbitration award (“New York Action”). Harvard Cellular sought partial vacatur. In 2006, the New York Supreme Court allowed the motion to confirm the arbitration award and denied Harvard Cellular's motion for partial vacatur.

         In 2008, New Cingular brought a separate action in the United States District Court for the Southern District of Florida to enforce personal guarantees signed by Kaufman with respect to the arbitration award (“Florida Action”). Kaufman counterclaimed that, among other things, he was fraudulently induced to sign the personal guarantees. The Court in the Florida Action allowed New Cingular's motion for summary judgment and dismissed Kaufman's counterclaims as barred by res judicata. The parties subsequently entered a settlement agreement that deferred execution of the arbitration judgment until Kaufman reached a specified net worth (“the 2009 Settlement Agreement”).

         D. Current Action

         In 2010, Kaufman sent a letter to New Cingular allegedly threatening to publish a book disparaging defendants. DBR sent a cease and desist letter that reminded Kaufman of his obligations under the 2009 Settlement Agreement. In 2016, Kaufman informed AT&T, Joseph and the arbitrator, John Wilkinson, by letter, that he intended to file this suit.[1]

         Kaufman filed the instant complaint in September, 2016, in the Massachusetts Superior Court for Suffolk County alleging that, during the arbitration that occurred in 2003 and 2004 and thereafter, DBR breached its covenant of good faith and fair dealing and all the defendants committed fraud upon the court and made fraudulent misrepresentations. Defendants removed the case to this Court and filed a joint motion to dismiss for failure to state a claim upon which relief can be granted. That motion, which Kaufman timely opposed, is the subject matter of this memorandum and order and will be allowed.

         II. Motion to Dismiss

         A. Legal Standard

         To survive a motion to dismiss for failure to state a claim under Fed.R.Civ.P. 12(b)(6), a complaint must contain “sufficient factual matter” to state a claim for relief that is actionable as a matter of law and “plausible on its face”. Ashcroft v. Iqbal, 556 U.S. 662, 667 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). A claim is facially plausible if, after accepting as true all non-conclusory factual allegations, a court can draw the reasonable inference that the defendant is liable for the misconduct alleged. Ocasio-Hernandez v. Fortuno Burset, 640 F.3d 1, 12 (1st Cir. 2011). A court may not disregard properly pled factual allegations even if actual ...


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