Superior Court of Massachusetts, Suffolk, Business Litigation Session
DIGITAL STRATEGISTS, LLC et al.
LEAP PAYMENTS, INC. et al.
Date: July 17, 2018
MEMORANDUM AND ORDER ON DEFENDANTSâ MOTION TO DISMISS
AND SCHEDULING ORDER
Kenneth W. Salinger, Justice of the Superior Court
Digital Strategists, LLC, alleges that it "provides
strategic management for digital and website development to
business and individuals worldwide." Digital and its
president and owner Debra Lessard retained Leap Payments,
Inc., and Elavon, Inc., in February 2018 to process credit
card and debit card payments. Defendants terminated
Plaintiffsâ account five and half weeks later, on March 18,
2018. This lawsuit arises from that brief business
have moved to dismiss all claims under Mass.R.Civ.P.
Court concludes that Digital has stated viable claims for
violation of c. 93A, breach of contract, and intentional
interference with contractual relations. The facts alleged in
the complaint plausibly suggest that Defendants engaged in
unfair trade practices and did not act in good faith when
they told Northeastern University that they were
investigating Digital for fraud, that as a result Digital
lost Northeastern as a customer and lost profits on that
account, and that Defendants understood it was substantially
certain that their communications with Northeastern would
have such a result.
the court will allow the motion to dismiss with respect to
Plaintiffsâ claims of negligence and fraud. Digitalâs
negligence claim is barred by the "economic loss"
rule. And Plaintiffsâ fraud claims fail because the facts
alleged do not plausibly suggest that Defendantsâ purportedly
false promises caused any compensable injury.
survive a motion to dismiss under Rule 12(b)(6), a complaint
must allege facts that, if true, "plausibly
suggest" the plaintiff has a viable claim. Lopez v.
Commonwealth, 463 Mass. 696, 701 (2012), quoting
Iannacchino v. Ford Motor Co., 451 Mass. 623, 636
(2008), and Bell Atl. Corp. v. Twombly, 550 U.S.
544, 557 (2007). In deciding this motion, the Court must
assume that the factual allegations in the complaint are true
and must draw "every reasonable inference in favor of
the plaintiff" from those allegations. Rafferty v.
Merck & Co., Inc., 479 Mass. 141, 147 (2018). In so
doing, however, it must "look beyond the conclusory
allegations in the complaint and focus on whether the factual
allegations plausibly suggest an entitlement to relief."
Maling v. Finnegan, Henderson, Farabow, Garrett & Dunner,
LLP, 473 Mass. 336, 339 (2015), quoting Curtis v.
Herb Chambers I-95, Inc., 458 Mass. 674, 676 (2011).
allege the following facts in their complaint.
retained Defendants on February 8, 2018, to provide payment
processing services. Plaintiffs did so in reliance on false
promises by Leap to provide same-day payment processing of
credit and debit card payments, that Plaintiffs would only
have to deal with Leap for their payment processing services,
and that all material terms of the agreement had been
disclosed. Leap knew that these promises were false. More
specifically, Leap knew that it could not process payments on
the same day it received a transaction, that Leap was
marketing payment processing services that would actually be
provided by Elavon, and that Elavonâs terms of service
included a mandatory arbitration provision that was never
disclosed to Plaintiffs, who were not allowed to view
Elavonâs terms of service before contracting with Leap.
Digital processed and transmitted to Defendants a credit card
payment by Northeastern University, which was a significant
new client of Digital.
of processing the payment, Defendants contacted Northeastern
and said they were conducting a fraud investigation of
Digital. Defendants asserted that Digital had provided a fake
address and telephone number and was not operating under its
own website. Those accusations were false. Defendants made no
attempt to investigate those charges before making these
false accusations to Northeastern. Northeastern responded to
Defendantâs misrepresentations by terminating its contract
repeatedly complained to Defendants about their failure to
provide same-day payment processing. Defendants responded to
these complaints by ...