Bill Staar, the Directing Partner of the New Hampshire office of Morrison Mahoney LLP, recently prevailed on behalf of local heavy-construction-equipment dealer, Milton CAT, before the Massachusetts Superior Court in a seven-year-old case. (Wilson v. Benoit, et al.; No. 1181CV03593; Mass. Sup. Ct.; 9/10/19; Connolly, J.)

Background

The plaintiff, a former mechanic employed by Milton CAT in Massachusetts, claimed to have suffered significant workplace injuries and, thereafter, began collecting workers'-compensation payments. Unbeknownst to Milton CAT, while collecting workers'-compensation payments, the plaintiff established his own business in New Hampshire and began performing paid mechanical work on various heavy-construction vehicles.

Eventually, the Milton CAT employee responsible for managing the company's workers'-compensation claims obtained proof of the scheme and was prepared to report the plaintiff to the Massachusetts Insurance Fraud Bureau ("IFB"). Based on the unfortunate advice of counsel assigned by Milton CAT's insurer, she instead agreed not to report the plaintiff to the IFB in exchange for a nominal settlement of the plaintiff's ongoing workers'-compensation claim. Upon learning of the agreement and consulting with Milton CAT's corporate counsel, who advised that concealing the plaintiff's fraud may itself be a criminal violation, Milton CAT management reported the plaintiff to the IFB. The IFB conducted an investigation, the Commonwealth brought charges, and a Massachusetts jury eventually convicted the plaintiff of insurance fraud.

Thereafter, the plaintiff brought suit against Milton CAT and others. As to Milton CAT, he claimed various causes of action, including (1) breach of contract, (2) negligent infliction of emotional distress, (3) intentional infliction of emotional distress, and (4) violation of the Massachusetts consumer-protection statute a/k/a Chapter 93A,

Decisions

In 2015, the Court (Wall, J.), dismissed two of the four claims against Milton CAT, finding (1) that the Chapter 93A claim could not survive because the subject employee-employer dispute did not involve trade or commerce as required for a 93A claim and (2) that the negligent-infliction-of-emotional-distress claim could not survive because it was clear that the plaintiff was alleging intentional acts. As to the remaining claims, the Court determined that more discovery was needed.

In September 2019, the Court (Connolly, J.) rejected the two remaining claims via summary judgment. As to the breach-of-contract claim, the Court found that, although Milton CAT technically breached the subject agreement not to report the plaintiff to the IFB, (1) that contract was illegal, (2) when comparing wrongdoing by each party, the plaintiff was the more culpable party, and (3) not rejecting the plaintiff's claim was against public policy because to do so would promote insurance fraud. As to the allegation of intentional infliction of emotional distress, the Court determined that Milton CAT’s behavior, i.e., breaching an illegal contract for the purpose of reporting insurance fraud, does not remotely meet the standard of extreme behavior required for a finding of intentional infliction of emotional distress.