United States District Court, D. Massachusetts
LIBERTY MUTUAL INSURANCE COMPANY and LIBERTY MUTUAL GROUP INC., Third-Party Plaintiffs,
PRECISE LEADS, INC. and DIGITAS, INC., Third-Party Defendants.
MEMORANDUM AND ORDER
ALLISON D. BURROUGHS, U.S. DISTRICT JUDGE
action, initially brought under the Telephone Consumer
Protection Act (“TCPA”), now concerns how a
settlement payment and litigation expenses should be
apportioned among the original defendants and the third-party
8, 2015, Ken Johansen filed class action claims for
violations of the TCPA against Liberty Mutual Group Inc.
(“LMG”) and Spanish Quotes, Inc (“Spanish
Quotes”). [ECF No. 1]. The Court ordered that any
motions for leave to amend the pleadings be filed by March
15, 2016. [ECF No. 49]. In March 2016, after obtaining leave,
LMG and its subsidiary Liberty Mutual Insurance Company
(“LMIC”) (together, “Liberty Mutual”)
filed a Third-Party Complaint that asserted claims for
contractual indemnity, breach of contract, and negligence
against Precise Leads, Inc. (“Precise Leads”) and
Digitas, Inc. (“Digitas”). [ECF No. 61]. Liberty
Mutual alleged that Precise Leads and Digitas were
responsible for any violations of the TCPA as to Mr. Johansen
but that they were, in violation of their agreements with
Liberty Mutual, refusing Liberty Mutual's requests for
indemnification. Liberty Mutual claimed damages including
attorneys' fees and costs and any other payment provided
to Plaintiff to resolve this action. [ECF No. 61 at 24-31].
early 2018, Mr. Johansen settled his claims against Liberty
Mutual and Spanish Quotes, and on May 30, 2018, his claims
were dismissed with prejudice. [ECF No. 184]. Liberty Mutual
now seeks leave to file an Amended Third-Party Complaint that
would add Massachusetts Chapter 93A § 11 claims against
Precise Leads and Digitas. [ECF No. 181-1]
(“PFAC”). Precise Leads and Digitas argue that
the amendment is untimely and futile, and Precise Leads also
argues that the motion is frivolous and that it should be
awarded attorneys' fees and costs. [ECF Nos. 185, 186].
reasons explained herein, the Motion to Amend is GRANTED
IN PART and DENIED IN PART. Precise Leads'
motion for fees and costs is DENIED.
following facts are drawn primarily from the Proposed Amended
Third-Party Complaint, ECF No. 181-1, the well pled
allegations of which must be taken as true for any evaluation
regarding the futility of amending the Third-Party Complaint.
Mutual sells auto insurance policies to consumers. [PFAC at
8]. In April 2012, Digitas entered into a master services
agreement to assist LMIC in marketing auto insurance policies
by generating customer leads. [PFAC at 9]. The master
services agreement contained a mutual indemnification
provision under which Digitas was obligated to indemnify
Liberty Mutual for:
all third party claims, damages, liabilities, costs and
expenses, including reasonable legal fees and expenses . . .
to the extent arising out of any breach of warranty,
representation, covenant, obligation or agreement made by the
indemnifying party in this Agreement, provided that in no
event shall a party indemnify another party to the extent of
any Claim arising on account of the gross negligence or
intentional misconduct of any Indemnitee.
[PFAC at 9]. Under the agreement, indemnity is conditional
upon prompt written notice of any claim, the opportunity for
complete control of the defense and settlement, and
reasonable cooperation from the indemnified party. [PFAC at
9]. Digitas warranted that it would use commercially
reasonably efforts that would not give consumers grounds for
asserting certain claims, including invasion of the right of
privacy, and that it would comply with the requirements of
applicable statements of work. [PFAC at 10].
February 6, 2015, under the framework provided for by the
master services agreement, Liberty Mutual and Digitas agreed
to a statement of work to help drive acquisition of new
customers through “paid search, aggregator and
affiliate landing pages.” [PFAC at 10]. The statement
of work did not include outbound calls, but Digitas made such
calls and did so without adequate procedures to ensure
compliance with the TCPA, including the unlawful calls to Mr.
Johansen that led to this lawsuit. [PFAC at 10-11, 26-27].
Liberty Mutual notified Digitas of Mr. Johansen's claims
on August 7, 2015 and gave Digitas the opportunity to take
complete control of the defense and settlement of this
litigation on that date and several times thereafter. [PFAC
at 11]. Liberty Mutual also made numerous requests for
indemnification between August 2015 and February 2016. [PFAC
at 11]. Digitas never took control of the litigation and
refused to indemnify Liberty Mutual for its costs. [PFAC at
Leads also entered an agreement with Liberty Mutual to
support certain marketing activities. [PFAC at 12]. The
Precise Leads agreement contained a mutual indemnification
provision that required indemnification:
against any and all claims, losses, costs and expenses,
including reasonable attorneys' fees, which the
Indemnified Party may incur as a result of claims in any form
by third parties . . . arising from . . . [t]he Indemnifying
Party's acts omissions or misrepresentations to the
extent that the Indemnifying Party is deemed an agent of the