United States District Court, D. Massachusetts
MEMORANDUM AND ORDER
Talwan, United States District Judge.
Patrick Griffin (“Griffin”) brings this action
against Defendants Thomas E. Coghill Jr.
(“Junior”), his parents Thomas E. Coghill Sr.
(“Senior”) and Nancy Coghill (“Mrs.
Coghill”) (together, the “Senior
Coghills”), Xtreme Fat Bikes and Components, LLC
(“Xtreme”), and The Trustee of the Xtreme Fat
Tire Bike Irrevocable Trust (“the Trust”).
Griffin asserts against all Defendants state law claims of
fraud and deceit, fraud in the inducement, negligent
misrepresentation, promissory estoppel, breach of fiduciary
duty, breach of contract, breach of the covenant of good
faith and fair dealing, and money had and received in
connection with a purported fat tire bike business. Compl.
Senior Coghills have moved to dismiss for lack of personal
jurisdiction. Mot. to Dismiss [#18]. Griffin counters that
this court has personal jurisdiction over the Senior Coghills
because Junior acted as their agent, and in any event, the
Senior Coghills themselves had sufficient minimum contacts.
Mem. Law Supp. Pl.'s Opp'n Mot. to Dismiss Filed By
Thomas E. Coghill, Sr. & Nancy Coghill (“Pl.'s
Opp'n Re Senior Coghills' Mot.”) [#33]. For the
reasons that follow, the Senior Coghills' motion is
and Xtreme have moved to dismiss the complaint on the ground
that all counts against them are barred by the
forum-selection clause in a 2016 Purchase and Sale Agreement,
requiring suit to be brought in Broward County, Florida. Mot.
to Dismiss the Pl.'s Compl. [#13]. They argue further
that any non-contract claims are also barred by a mutual
general release agreement in an amendment to the 2016
Purchase and Sale Agreement, signed that same day.
Id. Griffin contends in response that the 2016
agreement and amendment are voidable as procured by fraud.
Mem. Law Supp. Pl.'s Opp'n Mot. to Dismiss Filed By
Thomas E. Coghill, Jr. & Xtreme Fat Tire Bikes &
Components, LLC (“Pl.'s Opp'n Re Junior &
Xtreme's Mot.”) [#27]. For the reasons that follow,
Junior and Xtreme's motion is DENIED.
approximately November 2014, Griffin made a telephone call
from Massachusetts to a Florida-based fat tire bike company.
Compl. ¶ 9 [#1]. Junior, an employee of the company,
answered Griffin's call. Id. ¶ 10. After
Griffin explained that he wanted to learn more about fat tire
bikes so that he could rent them out of his shop, Junior told
Griffin that in several months, Junior planned to start his
own fat tire bike company. Id. ¶¶ 11-12.
Junior further stated that his company would sell “much
better” bikes than those about which Griffin had
called. Id. ¶ 12. Griffin expressed an interest
in further discussions. Id. ¶ 13.
thereafter, Junior emailed Griffin several pictures of the
fat tire bikes he hoped to sell, and directed Griffin to view
the fat tire bikes Junior offered for sale on Indiegogo.com.
Id. ¶¶ 14-15. Over the next month, Junior
and Griffin continued their business discussions, eventually
agreeing that Griffin would serve as the exclusive
distributor of Xtreme Fat Tire Bikes in the northeastern
United States. Id. ¶¶ 16-17. In exchange,
Griffin was to wire $25, 000 from Massachusetts to a Florida
bank account in the name of Defendant Xtreme, an LLC based in
Florida. Id. ¶ 18. Junior and the Senior
Coghills were signatories on that bank account. Id.
December 2014, Xtreme's Operating Agreement was amended
to reflect that Griffin took a 25% interest in Xtreme.
Id. ¶ 101. Senior and Mrs. Coghill signed as
“former members” of Xtreme. Pl.'s Opp'n
Re Senior Coghills' Mot., Ex. 6, Am. Operating Agreement
of Xtreme Fat Bikes & Components, LLC (“2014 Am.
Operating Agreement”) [#33-6] at 2. Senior also signed
as Trustee for the Trust. Id.
January 29, 2015, and February 26, 2015, Griffin wired $16,
000 from his Massachusetts bank account to the Xtreme bank
account. Compl. ¶¶ 20-22 [#1].
approximately March 2015, Griffin and his wife traveled to
Florida. Id. ¶ 23. While there, Griffin
arranged to and did meet with Junior at the Senior
Coghills' home. Id. ¶ 26. Junior showed
Griffin and his wife the inventory of two fat tire bikes in
the Senior Coghills' garage and asked Griffin to assume a
larger role in the business. Id. ¶¶ 26-27.
Griffin and his wife then rode the fat tire bikes to and
along Deerfield Beach, where they were stopped numerous times
by people interested to learn more about the bikes.
Id. ¶¶ 28-29. Based on that bike ride and
the interest generated, Griffin decided to continue
discussing with Junior as to whether Griffin would assume a
larger role in the business. Id. ¶ 30.
March 17, 2015, the Senior Coghills and Griffin entered into
a Membership Purchase and Sale Agreement. Pl.'s Opp'n
Re Senior Coghills' Mot., Ex. 7, Membership Interest
Purchase & Sale Agreement [#33-7]. Under this agreement,
the Senior Coghills transferred their interest in Xtreme to
the Trust and Griffin, in exchange for approximately $2, 500
from Griffin. Id. §§ 1-2.
that month, Griffin purchased airline tickets for Junior to
fly from Florida to Massachusetts to meet with Griffin and
his wife a second time. Compl. ¶ 31 [#1]. Junior then
flew up to Boston, staying with Griffin while the two engaged
in further business discussions. Id. ¶¶
32-33. During that visit, Junior asked Griffin to become his
business partner and to help grow Xtreme, and Griffin agreed
to do so. Id. ¶¶ 34-35. In these
discussions, Junior represented that Griffin would also be
business partners with the Senior Coghills. Aff. Patrick
Griffin Supp. Mem. Law Supp. Pl.'s Opp'n Mot. Dismiss
Filed By Thomas E. Coghill, Jr. & Xtreme Fat Tire Bikes
& Components, LLC (“Pl.'s Aff. Supp. Opp'n
Re Senior Coghills' Mot.”) ¶¶ 19-21
[#33-10]. One condition of the partnership, set at
Junior's insistence, was that Griffin not be given access
to or control over any Xtreme bank accounts. Compl. ¶ 36
subsequently leased commercial space in One International
Place in Boston, Massachusetts and began working to grow the
business. Id. ¶ 37. Griffin also paid Junior an
additional $25, 000. Id. ¶¶ 38-39.
Throughout April 2015, Griffin and Junior operated the
business and continued their business discussions.
Id. ¶ 40.
April 8, 2015, Junior, on behalf of Xtreme, added Griffin and
the Trust, and removed the Senior Coghills, as members in
Xtreme. Pl.'s Opp'n Re Senior Coghills' Mot., Ex.
11, Articles of Am. to Articles of Org. of Xtreme Fat Bikes
& Components, LLC [#33-11].
subsequently represented to Griffin that Xtreme had
approximately three hundred outstanding orders that could not
be fulfilled due to cash-flow difficulties. Compl.
¶¶ 41-42 [#1]. In reliance on this representation,
Griffin wired $73, 500 to the Xtreme bank account so that
Junior could wire the funds to a company in Korea that
manufactured the fat tire bikes they planned to sell.
Id. ¶¶ 42-43. Griffin and Junior agreed
that Griffin would recoup his $73, 500 payment by November
2015, and that Griffin would become a 25% owner in the
business in lieu of charging interest on the $73, 500 loan.
Id. ¶ 44.
Junior represented to Griffin that he wired the $73, 500 to
the Korean manufacturing company, Junior did not wire the
funds, instead sending the money to his own personal bank
account in Florida. Id. ¶¶ 46-48. Junior
and the Senior Coghills also withdrew money from the Xtreme
bank account. Id. ¶¶ 49-50.
continued representing to Griffin that the company was doing
well and receiving numerous new orders, eventually requesting
that Griffin wire an additional $90, 000 to fulfill these new
orders. Id. ¶¶ 51-52. Griffin then wired
$90, 000 from his Massachusetts bank account to the Xtreme
bank account in July 2015. Id. ¶ 53. Although
Junior represented that he wired the $90, 000 to the Korean
manufacturer, he did not do so, instead wiring a substantial
amount of cash from the Xtreme bank account to his ...