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King v. Prodea Systems, Inc.

United States District Court, D. Massachusetts

December 20, 2019

Tyson KING, Plaintiff,
PRODEA SYSTEMS, INC., et al., Defendants.

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          Andrew S. McIlvaine, David E. Belfort, Bennett & Belfort, PC, Cambridge, MA, Plaintiff.

          Christopher M. Pardo, Hunton Andrews Kurth LLP, Boston, MA, for Defendants.


         GORTON, J.

         Tyson King ("King" or "plaintiff") brings this action against his employer

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Prodea Systems, Inc. ("Prodea"), its subsidiary, Arrayent, Inc. ("Arrayent") and the following individuals: Amir Ansari (Chief Technology Officer of Prodea), Anousheh Ansari (Executive Chairwoman of Prodea), Hamid Ansari (Chief Executive Officer and President of Prodea), Shane Dyer (Founder of Arrayent) and Cyril Brignone (Chief Revenue Officer of Prodea and Former Chief Executive Officer of Arrayent) (collectively, "the Individual Defendants"). King seeks, in law and equity, unpaid wages and expense reimbursements pursuant to the Federal Fair Labor Standards Act, the Massachusetts Wage Act and contract law.

         I. Background

         A. Prodea and Arrayent

         Prodea is a Delaware corporation engaged in the digital technology business and specializes in internet-based services. It maintains its principal place of business in Texas and, until mid-2018, had additional offices in California.

         In July, 2017, Prodea acquired Arrayent as a wholly owned subsidiary. It is a Delaware corporation with its principal place of business in Texas and a registered address in California.

         Prodea and Arrayent (collectively, "the Corporate Defendants") have clients all over the world. No client of the Corporate Defendants is, however, headquartered in Massachusetts.

         Plaintiff avers that he was, at all relevant times, employed by both Corporate Defendants. King maintained a Prodea email account and a Prodea business card which listed his business address as Arrayent's California address. His paychecks were issued by Arrayent as his employer and he was paid with funds from a bank account registered to Arrayent.

         B. The Individual Defendants

         Three of the Individual Defendants (Amir, Anousheh and Hamid) are residents of the State of Texas. Dyer and Brignone are California residents.

         C. King's Employment with the Corporate Defendants

         From January, 2018, until January, 2019, King was employed by the Corporate Defendants as Vice President of Sales. His duties included soliciting and servicing the customers of the Corporate Defendants globally.

         King, a Massachusetts resident, worked for the Corporate Defendants in Massachusetts from him home in Needham and from rented office space in Wellesley. Although King submits that he never planned to move, the Corporate Defendants contend that he indicated an intention to relocate to Texas upon the commencement of his employment. In any event, King was allowed to work remotely from Massachusetts after reporting to the Corporate Defendants that his wife had accepted a new job in the Commonwealth.

         The Corporate Defendants secured Workers Compensation Insurance to cover King in Massachusetts but aver that they considered him a "non-Massachusetts employee." Indeed, King's business card bore a California address. Nevertheless, the Corporate Defendants withheld Massachusetts state income taxes from King's salary.

         In February, 2018, King requested Prodea's permission to rent office space in Wellesley, Massachusetts and worked out of that office from February through June, 2018. Thereafter, King worked from his home office in Needham, Massachusetts.

         King performed the majority of his work-related duties in Massachusetts but traveled on business on at least 18 occasions, including to Texas, California, Nevada,

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New York, Mexico and Turkey. Nevertheless, King contends that his work in the Commonwealth facilitated substantial sales revenue for the Corporate Defendants. That work included soliciting customers, planning meetings, communicating with customers, preparing sales agreements and proposals and managing a team of salespersons. King emphasizes that, on two occasions, an executive from Prodea and/or Arrayent traveled to Massachusetts to join King on sales networking meetings with potential Massachusetts-based clients.

         King resigned his employment with the Corporate Defendants in January, 2019. He avers that the Corporate Defendants owe him approximately $71,000 in unpaid, earned wages and approximately $16,000 in approved but unpaid reimbursable business expenses. According to plaintiff, a human resources agent of the Corporate Defendants has admitted that King is owed approximately $68,000 in unpaid wages in addition to vacation pay.

         D. Procedural History

         Plaintiff filed a complaint against defendants in Massachusetts Superior Court in November, 2018. Defendants removed the case to this Court on diversity and federal question grounds in January, 2019. Defendants thereafter moved to dismiss the Complaint for lack of personal jurisdiction and failure to state a claim pursuant to Fed.R.Civ.P. 12(b)(2) and 12(b)(6). Before the Court ruled on that motion, plaintiff filed his first Amended Complaint, resulting in the Court ...

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