United States District Court, D. Massachusetts
MEMORANDUM AND ORDER DENYING DEFENDANT'S MOTION
FOR SUMMARY JUDGMENT AND GRANTING IN PART PLAINTIFF'S
MOTION TO COMPEL
ALLISON D. BURROUGHS U.S. DISTRICT JUDGE.
Quincy Mutual Fire Insurance Company (“Quincy”)
brings this action pursuant to Massachusetts General Laws
Chapter 93A (“Chapter 93A”), § 11 to recover
its costs for defending a third-party complaint that
Defendant Atlantic Specialty Insurance Company
(“Atlantic”) directed its insured to file against
Quincy. See [ECF No. 1-1 (“Complaint” or
“Compl.”)]. Quincy asserts that the underlying
third-party complaint, which was filed in the Massachusetts
Superior Court for Barnstable County (the “Superior
Court”), Richards v. MacDougalls' Cape Cod
Marine Services, Inc., No. 1472CV00632 (Mass. Super.
Ct.) (the “Richards Litigation”), brought claims
in bad faith at a time when Atlantic knew those claims were
without merit. Now pending before the Court are Quincy's
motion to compel discovery and Atlantic's motion for
summary judgment. [ECF Nos. 17, 19]. For the reasons
discussed herein, Atlantic's motion for summary judgment
[ECF No. 19] is DENIED, and
Quincy's motion to compel [ECF No. 17] is
GRANTED IN PART and
DENIED IN PART.
December 26, 2014, Joyce Richards initiated the Richards
Litigation against MacDougalls' Cape Cod Marine Services,
Inc. (“MacDougalls”) to recover for personal
injuries that she allegedly suffered on June 3, 2014 while
working as an employee of Boston Yacht Sales
(“BYS”) at MacDougalls' boatyard. [ECF No. 20
(“Atlantic Facts”) ¶¶ 2-4]. BYS was in
the business of selling boats from a sales office that it had
leased at MacDougalls' boatyard. [ECF No. 20-12 at 2].
Richards fell from a ladder while inspecting a potential BYS
client's boat in a building at the boatyard that was
located approximately 90 yards from BYS's sales office.
[Id. at 5]. At the time of Richards' injury,
MacDougalls was insured by Atlantic, and BYS was insured by
Quincy. Compl. ¶¶ 3, 24. Despite Atlantic's
allegations to the contrary, MacDougalls was not an insured
entity under the policy BYS obtained from Quincy, nor did the
Quincy policy otherwise cover Richard's injuries.
Id. ¶ 6.
March 12, 2015, at Atlantic's direction, MacDougalls
requested that BYS and Quincy defend and indemnify
MacDougalls against Richards' claims. Atlantic Facts
¶¶ 1, 10. Quincy refused to indemnify MacDougalls
and explained that MacDougalls was not listed on BYS's
insurance policy, an indemnity provision in BYS's lease
was void and unenforceable, and in any event, Richards'
injuries were not incurred on the property that BYS had
leased from MacDougalls. Compl. ¶¶ 9, 14-16. Quincy
claims that Atlantic never carried out a reasonable
investigation and that an investigation would have revealed
that Quincy owed no obligation whatsoever to MacDougalls.
Id. ¶¶ 7-8. On April 17, 2015, at
Atlantic's direction, MacDougalls filed a third-party
complaint against BYS and Quincy. Compl. ¶ 20; Atlantic
Facts ¶¶ 12-13. Quincy asserts that the claims were
“false and baseless.” Compl. ¶ 23.
responded by filing a counterclaim, alleging in part that
MacDougalls violated Chapter 93A by asserting groundless
indemnification and defense claims that relied on an
indemnification provision in BYS's lease that was
unenforceable and void. [ECF No. 20-12 at 21]. On June 7,
2016, the Superior Court entered summary judgment in favor of
Quincy on MacDougalls' claims. Atlantic Facts ¶ 16;
see generally [ECF No. 20-12]. The Superior Court
denied MacDougalls' motion for summary judgment on
Quincy's Chapter 93A counterclaim, concluding that there
was “a dispute of material fact as to whether
MacDougalls' demand for coverage in reliance on the void
indemnification provision constituted an unfair and deceptive
trade practice.” [ECF No. 20-12 at 21]. Although the
Superior Court recognized that “alleged unfair
practices conducted during the course of litigation do not
support [Chapter 93A] liability, Quincy's claim [was]
based on conduct that occurred prior to the parties'
litigation.” [Id. at 22 (citation omitted)].
August 7, 2018, Quincy filed this case in the Superior Court
of Norfolk County, and on August 30, 2018, Atlantic timely
removed the case to this Court. [ECF No. 1]; Compl. at 4.
Quincy seeks to recover litigation costs totaling more than
$100, 000 that it incurred in the Richards Litigation.
Atlantic Facts ¶ 19; [ECF No. 1-2]. Atlantic was not
a party to the Richards Litigation, and Quincy therefore
chose to initiate this case rather than proceeding within the
Richards Litigation. See Mass. R. Civ. P. 14. On
September 21, 2018 Atlantic filed an answer. [ECF No. 10].
The Court held a scheduling conference on October 23, 2018
and ordered discovery to be completed by June 29, 2019. [ECF
No. 15]. Quincy served interrogatories and requests for
production on Atlantic in February 2019, but rather than
engaging in the discovery process, Atlantic responded that it
intended to move for summary judgment. [ECF No. 18 at 1].
Quincy filed a motion to compel discovery on March 14, 2019,
[ECF No. 17], and Atlantic filed its motion for summary
judgment on March 26, 2019, [ECF No. 19]. Timely oppositions
were filed as to both motions. [ECF Nos. 21, 22].
SUMMARY JUDGMENT STANDARD OF REVIEW
judgment is appropriate where the movant can show that
“there is no genuine dispute as to any material fact
and the movant is entitled to judgment as a matter of
law.” Fed.R.Civ.P. 56(a). “A fact is material if
its resolution might affect the outcome of the case under the
controlling law. . . . A genuine issue exists as to such a
fact if there is evidence from which a reasonable trier could
decide the fact either way.” Cochran v. Quest
Software, Inc., 328 F.3d 1, 6 (1st Cir. 2003) (citation
succeed in showing that there is no genuine dispute of
material fact, ” the moving party must point to
“specific evidence in the record that would be
admissible at trial.” Ocasio-Hernandez v.
Fortuño-Burset, 777 F.3d 1, 4 (1st Cir. 2015).
“That is, it must ‘affirmatively produce evidence
that negates an essential element of the non-moving
party's claim,' or, using ‘evidentiary
materials already on file ... demonstrate that the non-moving
party will be unable to carry its burden of persuasion at
trial.'” Id. (quoting Carmona v.
Toledo, 215 F.3d 124, 132 (1st Cir. 2000)). “One
of the principal purposes of the summary judgment rule is to
isolate and dispose of factually unsupported claims or
defenses . . . .” Celotex Corp. v. Catrett,
477 U.S. 317, 323-24 (1986). Once the movant takes the
position that the record fails to make out any trialworthy
question of material fact, “it is the burden of the
nonmoving party to proffer facts sufficient to rebut the
movant's assertions.” Nansamba v. N. Shore Med.
Ctr., Inc., 727 F.3d 33, 40 (1st Cir. 2013).
reviewing the record, the court “must take the evidence
in the light most flattering to the party opposing summary
judgment, indulging all reasonable inferences in that
party's favor.” Cochran, 328 F.3d at 6
(citation omitted). The First Circuit has noted that this
standard “is favorable to the nonmoving party, but it
does not give him a free pass to trial.” Hannon v.
Beard, 645 F.3d 45, 48 (1st Cir. 2011). “The
factual conflicts upon which he relies must be both genuine
and material, ” Gomez v. Stop & Shop
Supermarket Co., 670 F.3d 395, 397 (1st Cir. 2012), and
the court may discount “conclusory allegations,
improbable inferences, and unsupported speculation, ”
Cochran, 328 F.3d at 6 (quoting Medina-Munoz v.
R.J. Reynolds Tobacco Co., 896 F.2d 5, 8 (1st Cir.
1990)). “If the evidence is merely colorable, or is not
significantly probative, summary judgment may be
granted.” Medina-Munoz, 896 F.2d at 8 (quoting
Anderson v. Liberty Lobby, Inc., 477 U.S. 242,
Federal Rule of Civil Procedure 56 allows a motion for
summary judgment “at any time until 30 days after the
close of all discovery, ” Fed.R.Civ.P. 56(b), the Court
is mindful that Atlantic has not yet produced documents,
responded to interrogatories, or otherwise engaged in the
discovery process in a meaningful manner. Accordingly, for
the purposes of the instant motion, the Court will assume the
truth of the allegations in the Complaint concerning
Atlantic's failure to undertake a reasonable
investigation of Richards' claims. See [Mot. to
Compel, ECF No. 17 (“At a conference held on March 14,
2019, Defendant's counsel advised Plaintiff's counsel
that the Defendant would not be answering the interrogatories
or producing the documents requested . . .
SUMMARY JUDGMENT DISCUSSION
brings a single claim against Atlantic for violating Chapter
93A, § 11, which allows actions by businesses that
suffer a loss “as a result of the use or employment by
another person who engages in any trade or commerce of an
unfair method of competition or an unfair or deceptive act or
practice . . . .” Mass. Gen. Laws ch. 93A, § 11.
Chapter 93A “was designed ‘to encourage more
equitable behavior in the marketplace and impose liability on
persons seeking to profit from unfair practices.'”
Linkage Corp. v. Trs. of Bos. Univ., 679 N.E.2d 191,
208 (Mass. 1997) (quoting Poznik v. Massachusetts Med.
Prof'l Ins., 628 N.E.2d 1, 4 (Mass. 1994)).
“[A] chapter 93A claimant must show that the
defendant's actions fell ‘within at least the
penumbra of some common-law, statutory, or other established
concept of unfairness,' or were ‘immoral,
unethical, oppressive or unscrupulous,' and resulted in
‘substantial injury … to competitors or other
business [persons].'” Boyle v. Int'l Truck
& Engine Corp., 369 F.3d 9, 15 (1st Cir. 2004)
(quoting Quaker State Oil Ref. Corp. v. Gamty Oil
Co., 884 F.2d 1510, 1513 (1st Cir. 1989)). “In the
context of disputes among businesses, where both parties are
sophisticated commercial players, the ‘objectionable
conduct must attain a level of rascality that would raise an
eyebrow to the rough and tumble of the world of
commerce.'” Ora Catering, Inc. v. Northland
Ins., 57 F.Supp.3d 102, 110 (D. Mass. 2014) (quoting
Levings v. Forbes & Wallace, Inc., 396 N.E.2d
149, 153 (Mass. App. Ct. ...