Case 4:16-cv-10864-DHH Document 25 Filed 10/23/17 Page 1 of 15
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`UNITED STATES DISTRICT COURT
`DISTRICT OF MASSACHUSETTS
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`ATLANTIS SERVICES, INC.,
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`Plaintiff,
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`ASIGRA, INC.
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`Defendant.
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`CIVIL ACTION
`NO. 16-10864-DHH
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`ORDER
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`October 23, 2017
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`Hennessy, M.J.
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`This matter is before the court on Defendant Asigra, Inc.’s (“Asigra”) Motion for Judgment
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`on the Pleadings. (Docket #12). Plaintiff Atlantis Services, Inc. (“Atlantis”) has filed a response,
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`(Docket #17), and a hearing on the motion was held on August 4, 2017, (Docket #19). Also before
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`the court is Asigra’s Motion to Strike the Affidavit of Paul Pathiakis, (Docket #23), to which
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`Atlantis filed a response, (Docket #24). Both matters are now ripe for adjudication. For the
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`reasons that follow, Asigra’s Motion to Strike (Docket #23) is ALLOWED, and Asigra’s Motion
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`for Judgment on the Pleadings (Docket #12) is ALLOWED IN PART AND DENIED IN PART.
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`Judgment shall be entered in favor of Asigra on count VII of the complaint.
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`I.
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`BACKGROUND
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`On April 15, 2014, plaintiff Atlantis Services, Inc. (“Atlantis”), a Massachusetts
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`corporation based in Uxbridge, Massachusetts and defendant, Asigra, Inc. (“Asigra”), a Canadian
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`corporation located in Toronto, Ontario, entered into an agreement whereby Atlantis would
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`provide computer software services to Asigra. (Docket #1 at ¶¶ 3-5). In exchange, Asigra agreed
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`to pay Atlantis $125.00 per work hour. (Id. at ¶ 6). The scope of services to be provided appear
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`to have been set out orally and is captured in a document entitled Asigra Large System Project
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`Deliverable, which details a conversation between the parties outlining the specifications of a
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`software product to be designed by Atlantis. (Id. at ¶ 5, Exhibit A).
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`Project completion was initially anticipated to take 2000 hours, referred to as “one work
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`year.” (Docket #1 at ¶ 6). However, this time frame was continuously shortened by Asigra
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`throughout the project lifetime. (Id. at ¶ 7). During a May 8, 2014 phone call, Aram Farajun, CEO
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`and principal owner of Asigra, asked Paul Pathiakis, the CEO of Atlantis, whether Atlantis could
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`accelerate the development time.1 (Id. at ¶ 8, Docket #22 at ¶ 4). In response, Atlantis told Asigra
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`that the only way to complete the project on an accelerated schedule would be to use code from
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`Atlantis’ own appliance product (the “Appliance Code”).2 (Docket #1 at ¶ 8). In what it contends
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`in its motion papers is an additional contract, during this phone call, Atlantis granted Asigra a
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`limited right-to-use its Appliance Code and agreed to setup a call center for product support
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`provided that Asigra pay all invoices and agree to pay Atlantis to service the product. (Id. at ¶¶ 9-
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`11; Docket #17 at 1).
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`By June 7, 2014, Atlantis completed the project using its code and Asigra “took delivery
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`and accepted the project as conforming.” (Docket #1 at ¶¶ 13, 15). On June 20, 2014, Atlantis
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`sent Asigra its final invoice itemizing its fees and requesting payment. (Id. at ¶¶ 16-17). In
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`discussions regarding payment, Asigra acknowledged the accuracy of the debt and agreed to pay
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`the invoice provided Atlantis assign Asigra the rights to its code. (Id. at ¶¶ 17-18). Atlantis refused
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`1 Aram Farajun is also known as David Farajun. (Docket #22 at ¶ 4).
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` Atlantis copyrighted the Appliance Code on February 9, 2016. (Docket #13-2).
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`to assign its rights to the code, limited or otherwise, absent Asigra’s performance of the purported
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`second agreement. (Docket #1 at ¶ 19).
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`On May 11, 2016, Atlantis filed suit against Asigra alleging claims of breach of contract
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`(count I), misappropriation of intellectual property (count II), trade secret misappropriation (count
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`III), common law misappropriation (count IV), unfair and deceptive practices (count V), unjust
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`enrichment (count VI), and copyright infringement (count VII). (Docket #1). Atlantis asserts that
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`Asigra has copied substantial portions of the Appliance Code program, distributed works
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`containing material copied from the Appliance Code, and created derivative works based on the
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`Appliance Code. (Id. at ¶ 21). On November 18, 2016, Asigra moved for judgment on the
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`pleadings on all counts other than count I. (Docket #12).
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`II.
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`STANDARD OF REVIEW
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`Pursuant to Federal Rule of Civil Procedure 12(c), a party may move for judgment on the
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`pleadings “[a]fter the pleadings are closed – but early enough not to delay trial.” A court reviews
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`motions for judgment on the pleadings under a standard that is essentially the same as that for a
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`motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), except that “[a] Rule 12(c)
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`motion, unlike a Rule 12(b)(6) motion, implicates the pleadings as a whole.” Aponte-Torres v.
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`Univ. of P.R., 445 F.3d 50, 54-55 (1st Cir. 2006). Facts contained in the pleadings are viewed in
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`the light most favorable to the nonmovant, and all reasonable inferences are drawn in its favor.
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`Zipperer v. Raytheon Co., 493 F.3d 50, 53 (1st Cir. 2007). In reviewing a motion under Rule
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`12(c), the court may consider “documents the authenticity of which are not disputed by the parties;
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`documents central to the plaintiff’s claim; and documents sufficiently referred to in the complaint.
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`Curran v. Cousins, 509 F.3d 36, 44 (1st Cir. 2007) (quoting Watterson v. Page, 987 F.2d 1, 3 (1st
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`Cir. 1993)) (alterations omitted). “Judgment on the pleadings is proper ‘only if the uncontested
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`and properly considered facts conclusively establish the movant’s entitlement to a favorable
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`judgment.’” Zipperer, 493 F.3d at 53 (quoting Aponte-Torres, 445 F.3d at 54).
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`III.
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`A.
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`ANALYSIS
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`Motion to Strike
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`On August 4, 2017, the court held a hearing on Asigra’s Motion for Judgment on the
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`Pleadings. (Docket #19). At the hearing, the court established a brief chronology of the parties’
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`relationship. (Docket #20 at 3-9). Missing from this chronology was the exact date of the
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`telephone conversation between the parties during which the alleged second contract was formed.
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`(Id. at 5-6). Neither party was able to provide this date at the hearing, although it was agreed that,
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`by necessary implication, the conversation must have occurred prior to project’s completion date
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`of June 7, 2014. (Id. at 8-9). Hence, the court asked the parties to submit an affidavit or stipulation
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`establishing when this telephone call occurred, and indicated that this filing would be part of the
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`record that the court would consider on the motion. (Id. at 39, 42-43).
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`On August 23, 2017, Atlantis filed an affidavit by Pathiakis. (Docket #22). In the first
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`five paragraphs of the affidavit, Pathiakis describes his relationship with Atlantis; details the terms
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`of the original contract; and states that, on May 8, 2014, when asked by Farajun if he could
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`accelerate the development time, he agreed to incorporate the Appliance Code into Asigra’s
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`product. (Id. at ¶¶ 1-5). Asigra does not seek to strike these statements. (Docket #23). Nor does
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`Asigra challenge the last two statements in the affidavit which note that Pathiakis’ telephone
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`service provider is T-Mobile. (Docket #22 at ¶¶ 12-13; Docket #23). Asigra does challenge the
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`remaining statements of the affidavit and asks that they be stricken. (Docket #23 at 1).
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`The statements at issue seek to describe the content of the alleged second contract. (Docket
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`#22 at ¶¶ 6-11). The court never requested this information and the parties did not seek leave, nor
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`did the court grant it, to file additional evidence addressing this matter. For that reason alone, the
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`contested portions of the affidavit are properly stricken. The court also notes that these statements
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`do not conform with paragraph 10 of the complaint, in which Atlantis alleges that “[t]he limited
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`right to use was contingent upon Asigra paying Atlantis’ invoices and granting Atlantis all the
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`servicing revenue of the new products.” (Docket #1 at ¶ 9) (emphasis added). In his affidavit,
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`Pathiakis states that “the consideration for the second contract was to be a Master Service
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`Agreement for servicing the System for Asigra” and that “[p]ayment for the initial work for hire
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`contract was separate and distinct from the income we were expecting to derive under the Master
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`Service Agreement.” (Docket #22 at ¶¶ 7, 11). Leave has not been granted to amend the
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`complaint, and the court specifically warned the parties that it did not “want this to be a moving
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`target where, well, that argument doesn’t work, so we’re going to have to now say something
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`different. I don’t really want to see that.” (Docket #20 at 30). For these reasons, the Motion to
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`Strike shall be allowed.
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`B.
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`Copyright Claim
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`Copyright holders may transfer a nonexclusive right to use a copyright by either express
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`or implied licensing of the copyrighted work. See Estate of Hevia v. Portrio Corp., 602 F.3d 34,
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`40-41 (1st Cir. 2010). An implied license is of limited scope; it “simply permits the use of a
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`copyrighted work in a particular manner.” Id. (quoting I.A.E., Inc. v. Shaver, 74 F.3d 768, 775
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`(7th Cir. 1996)). “Copyright infringement occurs when another party exercises, without
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`permission or other justification, any of the exclusive rights granted to the copyright owner.”
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`Montalvo v. LT’s Benjamin Records, Inc., 56 F. Supp. 3d 121, 129 (D.P.R. 2014). Where a
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`copyright owner has granted a nonexclusive license to another party, that party’s “[u]ses of the
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`copyrighted work that stay within the scope of [the] nonexclusive license are immunized from
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`infringement suits.” John G. Danielson, Inc. v. Winchester-Conant Props., Inc., 322 F.3d 26, 40
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`(1st Cir. 2003).
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`The parties agree that Atlantis orally granted Asigra a nonexclusive license to use its
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`Appliance Code in its product during a phone call on May 8, 2014. (Docket #1 at ¶ 9; Docket #22
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`at ¶ 4). Atlantis now asserts a copyright infringement claim against Asigra pursuant to 17 U.S.C.
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`§ 501, alleging that Asigra is infringing Atlantis’ copyrighted works by using Atlantis’ Appliance
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`Code in the Asigra product. (Docket #1 at ¶¶ 51-56). Atlantis states that it unilaterally revoked
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`the nonexclusive license when Asigra failed to implement the software service agreement that it
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`asserts was the consideration for Asigra’s use of the Appliance Code. (Docket #1 at ¶ 19; Docket
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`#17 at 6).
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`“An implied license is revocable . . . where no consideration has been given for the license.
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`Keane Dealer Servs. v. Harts, 968 F. Supp. 944, 947 (S.D.N.Y. 1997); see Avtec Sys. v. Peiffer,
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`21 F.3d 568, 574 n.12 (4th Cir. 1994) (“an implied license is necessarily nonexclusive and
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`revocable absent consideration”). Conversely, “a ‘nonexclusive license may be irrevocable if
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`supported by consideration.’” Carson v. Dynegy, Inc., 344 F.3d 446, 451 (5th Cir. 2003) (quoting
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`Lulirama Ltd., Inc. v. Axcess Broadcast Servs., Inc., 128 F.3d 872, 882 (5th Cir. 1997)). “[T]his
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`is so because a nonexclusive license supported by consideration is a contract.” Id. (quoting
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`Lulirama, 128 F.3d at 882).
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`Asigra argues that Atlantis cannot retroactively revoke its license to the Appliance Code
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`because the agreement between the parties allowing Asigra’s use of the Appliance Code is
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`supported by consideration. (Docket #13 at 6). Atlantis acknowledges that if this was a case
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`concerning non-payment of the last invoice for the work for hire contract, Asigra would be correct.
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`(Docket #17 at 6). However, Atlantis asserts that the parties entered into a second contract after
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`Asigra sought to have Atlantis speed up its work. (Id.). Atlantis states that, as consideration for
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`Atlantis’ agreement to use its Appliance Code in the Asigra product, Asigra agreed to provide the
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`servicing revenue for the product to Atlantis. (Id.). However, this is only part of the consideration
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`that Asigra agreed to provide Atlantis in return for the Appliance Code.
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`In its complaint, Atlantis asserts that “[t]he limited right to use [the Appliance Code] was
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`contingent upon Asigra paying Atlantis’ invoices and granting Atlantis all the servicing revenue
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`of the new products.” (Docket #1 at ¶ 10) (emphasis added). There is no dispute that Asigra paid
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`some of the invoices submitted by Atlantis, including for work done after the May 8, 2014 phone
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`call. (Docket #13-1). Hence, Asigra did provide partial consideration for Atlantis’ agreement to
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`incorporate the Appliance Code in the Asigra product. Therefore, Atlantis may not proceed on a
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`theory of copyright infringement.3 If there is a remedy, it lies for breach of contract. See Jacobsen
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`v. Katzer, 535 1373, 1380 (Fed. Cir. 2008) (“Generally, a ‘copyright owner who grants a
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`nonexclusive license to use his copyrighted material waives his right to sue the licensee for
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`copyright infringement’ and can sue only for breach of contract.”) (quoting Sun Microsystems,
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`Inc. v. Microsoft Corp., 188 F.3d 1115, 1121 (9th Cir. 1999); Graham v. James, 144 F.3d 229, 236
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`(2d Cir. 1998)).
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`I note that even if Atlantis had plead that the limited right to use the Appliance Code was
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`contingent only upon Asigra granting Atlantis all the servicing revenue of the new products,
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`Atlantis would still be unable to proceed on a copyright infringement claim. “Modifications have
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`long been recognized in law as valid, without additional consideration[.]” Beal Bank S.S.B. v.
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`Krock, 1998 U.S. App. LEXIS 22051, at *22 (1st Cir. Sept. 3, 1998) (quoting Roddy & McNulty
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`Ins. Agency, Inc. v. A.A. Proctor & Co., 16 Mass. App. Ct. 525, 536 (1983)) (alterations omitted).
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`3 As the court has found that Atlantis may not proceed on its copyright infringement claim, there is no need to address
`Asigra’s preemption arguments. (See Docket #20 at 36).
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`“The contract, when modified by the subsequent oral agreement, is substituted for the contract as
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`originally made, and the original consideration attaches to and supports the modified contract.”
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`Id. (quoting Thomas v. Barnes, 156 Mass. 581, 584 (1892)). Hence, Asigra’s partial payment of
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`the invoices, even prior to May 8, 2014, provide sufficient consideration for the oral modification
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`of the contract on May 8, 2014.
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`C.
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`Accordingly, Asigra is entitled to judgment on count VII of the complaint.
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`Misappropriation of Trade Secrets
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`“To prevail on a claim of misappropriation of trade secrets, a plaintiff must show: 1) the
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`information is a trade secret; 2) the plaintiff took reasonable steps to preserve the secrecy of the
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`information; and 3) the defendant used improper means, in breach of a confidential relationship,
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`to acquire and use the trade secret.” Incase Inc. v. Timex Corp., 488 F.3d 46, 52 (1st Cir. 2007).
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`In a footnote, Asigra argues that Atlantis has failed to satisfy the first element of a
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`misappropriation of trade secrets claim because Atlantis did not identify with any reasonable
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`precision the information it claims is subject to protection. (Docket #13 at 11 n.8). As it is only
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`raised in a footnote, the court finds that Asigra has waived this argument.4 See Nat’l Foreign Trade
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`Council v. Natsios, 181 F.3d 38, 61 n.17 (1st Cir. 1999) (“[The First Circuit] ha[s] repeatedly held
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`that arguments raised only in a footnote or in a perfunctory manner are waived.”)
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`Asigra also argues that Atlantis has failed to meet the second element of the claim, asserting
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`that, because Atlantis provided its Appliance Code to Asigra for use in a product that it knew
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`would be marketed and sold to the public, Atlantis cannot show that it took reasonable steps to
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`preserve the secrecy of its information. (Docket #13 at 11-12). However, the mere fact that the
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`Appliance Code was incorporated into Asigra’s product which was available for public purchase
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`4 For this same reason, the court declines to address Asigra’s argument that the misappropriation claims are barred
`under the doctrine of laches. (See Docket #13 at 10 n.7).
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`does not necessarily negate Atlantis’ claim. Computer programs have been found to constitute
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`trade secrets where the source code is not easily ascertainable or copied by inspection of the
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`program. See Q-Co Indus. v. Hoffman, 625 F. Supp. 608, 617 (S.D.N.Y. 1985) (holding that
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`plaintiff had established a likelihood of success on misappropriation of trade secrets claim where
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`the source code for its commercially sold product was copy protected so purchasing public could
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`not convert the program and would not be able to gain access to the source code). At this juncture,
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`the court finds that Atlantis has plead the second element of a claim of misappropriation of trade
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`secrets. See Trandes Corp. v. Guy F. Atkinson Co., 996 F.2d 655, 664 (4th Cir. 1993) (“Secrecy
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`is a question of fact.”).
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`Finally, Asigra argues that it did not employ improper means and/or methods to obtain
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`Atlantis’ proprietary information. (Docket #13 at 12). Atlantis alleges in its complaint that, in
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`order to induce Atlantis to grant Asigra a limited right-to-use the Appliance Code, Asigra falsely
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`promised to pay Atlantis by way of its software servicing program. (Docket #1 at ¶ 37). The
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`complaint can be plausibly read to assert that Asigra made this promise, never intending to honor
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`it, in order to induce Atlantis to provide Asigra with the Appliance Code. Hence, the court finds
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`that Atlantis has sufficiently plead the third element, and, therefore, may proceed on its
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`misappropriation of trade secrets claims. Asigra’s Motion for Judgment on the Pleadings is denied
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`with respect to counts II, III, and IV of the complaint.
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`D.
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`Unjust Enrichment
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`In count VI of its complaint, Atlantis asserts that Asigra has been unjustly enriched by
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`accepting Atlantis’ work and incorporating that work into its product without full compensation to
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`Atlantis. (Docket #1 at ¶¶ 47-50). Asigra argues that count VI of the complaint must be dismissed
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`as it seeks identical recovery as the breach of contract claim in count I. (Docket #13 at 13).
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`To prevail on a claim for unjust enrichment in Massachusetts, there must be “unjust
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`enrichment of one party and unjust detriment to another party.” Mass. Eye & Ear Infirmary v.
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`QLT Phototherapeutics, Inc., 552 F.3d 47, 57 (1st Cir. 2009) (quotation omitted). “Unjust
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`enrichment requires: (1) a benefit conferred upon the defendant by the plaintiff; (2) an appreciation
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`or knowledge by the defendant of the benefit; and (3) acceptance or retention by the defendant of
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`the benefit under the circumstances would be inequitable without payment for its value.” Id.
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`(citing Samuel Williston & Richard A. Lord, A Treatise on the Law of Contracts, § 68.5 (4th ed.
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`2003)). “Ordinarily, a claim of unjust enrichment will not lie where there is a valid contract that
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`defines the obligations of the parties.” Metro. Life Ins. Co. v. Cotter, 464 Mass. 623, 641 (2013)
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`(quotation omitted). This is because unjust enrichment is “an equitable remedy, and it is a basic
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`doctrine of equity jurisprudence that courts of equity should not act when the moving party has an
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`adequate remedy at law.” Biltcliffe v. Citimortgage, Inc., 952 F. Supp. 2d 371, 380 (D. Mass.
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`2013) (quotation and alterations omitted). A breach of contract is such a remedy, and, as a result,
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`damages between the two theories are mutually exclusive. Lass v. Bank of Am., 695 F.3d 129,
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`140 (1st Cir. 2012). However, “it is accepted practice to pursue both theories at the pleading
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`stage.” Id. (citing Vieira v. First Am. Title Ins. Co., 668 F. Supp. 2d 282, 295 (D. Mass. 2009)
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`(noting that Fed. R. Civ. P. 8(d), “permits Plaintiffs to plead alternative and even inconsistent legal
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`theories, such as breach of contract and unjust enrichment, even if Plaintiffs can only recover under
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`one of these theories”)).
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`At this stage of the proceedings, Atlantis may proceed on both its breach of contract and
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`unjust enrichment claims. Therefore, Asigra’s Motion for Judgment on the Pleadings is denied
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`with respect to count VI.
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`E.
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`Chapter 93A
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`In count V of its complaint, Atlantis alleges that Asigra committed an unfair and deceptive
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`practice in violation of Mass. Gen. Law ch. 93A when, after Atlantis’ work was concluded, it
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`refused to complete payment for Atlantis’ services unless Atlantis agreed to assign its rights to the
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`Appliance Code to Asigra. (Docket #1 at ¶¶ 45-46).
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`Section 2(a) of Chapter 93A proscribes “[u]nfair methods of competition and unfair or
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`deceptive acts or practices in the conduct of any trade or commerce.” Section 11 of that chapter
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`creates a cause of action for:
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`Any person who engages in the conduct of any trade or commerce and who suffers
`any loss of money or property, real or personal, as a result of the use or employment
`by another person who engages in any trade or commerce of an unfair method or
`competition or an unfair or deceptive act or practice declared unlawful by section
`two or by any rule or regulation issued [thereunder].
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`Thus, a successful claim under 93A requires a showing of (1) an unfair or deceptive act or practice
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`on the part of the defendant; (2) an injury or loss suffered by the plaintiff; and (3) a causal
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`connection between the defendant’s unfair or deceptive act or practice and the plaintiff’s injury.
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`Casavant v. Norwegian Cruise Line, Ltd., 76 Mass. App. Ct. 73, 76 (2009).
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`While “[t]here is no clear definition of what constitutes an ‘unfair or deceptive’ act[;] [i]n
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`the extensive case law on Chapter 93A, a common refrain has developed.” Ahern v. Scholz, 85
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`F.3d 774, 798 (1st Cir. 1996) (internal quotation omitted). “The objectionable conduct must attain
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`a level of rascality that would raise an eyebrow of someone inured to the rough and tumble world
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`of commerce.” Id. (quoting Quaker State Oil Refining Corp. v. Garrity Oil Co., 884 F.2d 1510,
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`1513 (1st Cir. 1989)). In short, “[a] chapter 93A claimant must show that the defendant’s actions
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`fell within at least the penumbra of some common-law, statutory, or other established concept of
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`unfairness, or were immoral, unethical, oppressive or unscrupulous, and resulted in substantial
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`injury to competitors or other businesspersons.” Boyle v. Int’l Truck & Engine Corp., 369 F.3d 9,
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`15 (1st Cir. 2004) (quoting Quaker State, 884 F.2d at 1513) (alterations omitted). Asigra argues
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`that the dispute between the parties was of a garden-variety business nature and did not rise to the
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`level of rascality required for an actionable 93A claim. (Docket #13 at 14).
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`“It is well established that a breach of a contract can lead to a violation of Chapter 93A.”
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`Id. However, “[a] mere breach of contract does not constitute an unfair or deceptive trade practice
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`under 93A, unless it rises to the level of ‘commercial extortion’ or a similar degree of culpable
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`conduct.” Commercial Union Ins. Co. v. Seven Provinces Ins. Co., 217 F.3d 33, 40 (1st Cir. 2000)
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`(internal citations omitted). As plead by Atlantis, the facts support a 93A claim. Atlantis asserts
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`that Asigra refused to make payment on the contract, not due to a legitimate business dispute, but
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`instead as a “wedge” against Atlantis to enhance its bargaining power to attain an assignment of
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`Atlantis’ rights to the Appliance Code. Such conduct rises to the level of commercial extortion
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`and is actionable under 93A. See Arthur D. Little, Inc. v. Dooyang Corp., 147 F.3d 47, 55 (1st
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`Cir. 1998) (“Where one party to an agreement employs a breach of contract to gain an unfair
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`advantage over another, the breach a has an extortionate quality that gives it the rancid flavor of
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`unfairness.” (quotation omitted)); Anthony’s Pier Four, Inc. v. HBC Assocs., 411 Mass. 451, 474
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`(1991) (“conduct in disregard of known contractual arrangements and intended to secure benefits
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`for the breaching party constitutes an unfair act or practice for c. 93A purposes” (quotation
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`omitted)).
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`Asigra also argues that, because Atlantis rejected Asigra’s request to assign its intellectual
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`property rights to Asigra, Atlantis has not suffered “actual damages” as required under Section 11.
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`(Docket #13 at 14-15). Under Section 11, Atlantis bears the burden of showing that it suffered a
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`loss of money or property stemming from Asigra’s extortionate activity. See Arthur D. Little, 147
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`Case 4:16-cv-10864-DHH Document 25 Filed 10/23/17 Page 13 of 15
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`F.3d at 56. Atlantis has met that burden. The pleadings assert that Asigra failed to pay invoices
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`that were due and owing as a means to obtain Atlantis’ intellectual property rights. The loss of
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`money owed under a contract, together with the plaintiff’s expenses incurred in attempting to
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`collect the debt, satisfies the loss requirement of Section 11. Id. at 57 (holding that combination
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`of plaintiff’s loss of use of money in addition to expenditures in order to recover the money,
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`including long-distance phone calls and meetings, meant that plaintiff suffered a loss of money or
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`property caused by defendant’s act of deception); see also Whitman & Co. v. Longview Partners
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`(Guernsey) Ltd., No. 14-12047-ADB, 2015 U.S. Dist. LEXIS 94100, at *21 (D. Mass. June 16,
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`2015) (Boal, M.J.), adopted, 2015 U.S. Dist. LEXIS 94099 (July 20, 2015). Atlantis, who was
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`required to make long distance phone calls to attempt to recover the money owed by Asigra and
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`who seeks its attorney fees for prosecuting this case, has met its burden of showing damages under
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`Section 11.
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`Finally, Asigra asserts that the 93A claim must be dismissed because there are no
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`allegations that Asigra’s acts or omissions occurred primarily and substantially within
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`Massachusetts. (Docket #13 at 15). No action under section 11 of Chapter 93A may “be brought
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`or maintained . . . unless the actions and transactions constituting the alleged unfair method of
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`competition or the unfair or deceptive act or practice occurred primarily and substantially within
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`the commonwealth.” Mass. Gen. Laws ch. 93A, § 11. The burden of proof on this matter rests
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`with Asigra. Id. In resolving this issue, “a judge should, after making findings of fact, and after
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`considering those findings in the context of the entire § 11 claim, determine whether the center of
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`gravity of the circumstances that give rise to the claim is primarily and substantially within the
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`Commonwealth.” Kuwaiti Danish Comput. Co. v. Digital Equip. Corp., 438 Mass. 459, 474
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`(2003). This “is not a determination that can be reduced to any precise formula. . . . Any
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`Case 4:16-cv-10864-DHH Document 25 Filed 10/23/17 Page 14 of 15
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`determination necessarily will be fact intensive and unique to each case.” Id. at 472-73. “Due to
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`the fact-finding process necessarily involved in evaluating the issue, ‘this particular ground for
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`challenging a c. 93A claim -- absent some extraordinary pleading concession by a claimant –
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`cannot be resolved on Rule 12 motions.’” Berklee Coll. of Music v. Music Indus. Educators, 733
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`F. Supp. 2d 204, 213 (D. Mass. 2010) (quoting Bliss Valley Props., LLC v. Eliopulos, No. 04-
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`1100 BLS, 2005 Mass. Super. LEXIS 291, at *17 (June 2, 2005)); see Back Bay Farm, LLC v.
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`Collusio, 230 F. Supp. 2d 176, 188 (D. Mass. 2002) (citing Amcel Corp. v. Intern. Exec. Sales,
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`Inc., 170 F.3d 32, 36 (1st Cir. 1999) (holding that a Section 11 cause of action attacked via a Rule
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`12 motion “should survive a ‘primarily and substantially’ challenge so long as the complaint
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`alleges that the plaintiff is located, and claims an injury, in Massachusetts.”)) Atlantis, a
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`Massachusetts corporation located in Uxbridge, Massachusetts, has alleged that it suffered
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`pecuniary damages when Asigra breached its contract. This necessarily impacted Atlantis in
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`Massachusetts. The court finds that these allegations are sufficient to overcome the motion for
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`judgment on the pleadings, although later factual development may reveal that the alleged
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`misconduct occurred primarily outside of Massachusetts.
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`For these reasons, Atlantis may proceed on its 93A claim; thus, Asigra’s Motion for
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`Judgment on the pleadings is denied with respect to count V.
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`Case 4:16-cv-10864-DHH Document 25 Filed 10/23/17 Page 15 of 15
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`IV.
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`CONCLUSION
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`For the foregoing reasons, Asigra’s Motion to Strike (Docket #23) is ALLOWED, and
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`Asigra’s Motion for Judgment on the Pleadings (Docket #12) is ALLOWED IN PART AND
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`DENIED IN PART. Judgment shall be entered in favor of Asigra on count VII of the complaint.
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`/s/ David H. Hennessy
`David H. Hennessy
`United States Magistrate Judge
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`15
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