Abdallah v. Bain Capital LLC

• Citation: 880 F.Supp.2d 190
• Decision Date: 24 July 2012
• Docket Number: Civil Action No. 11–11904–JLT.
• Parties: Murielle ABDALLAH, Individually and on behalf of all other persons similarly situated, Plaintiff, v. BAIN CAPITAL LLC, Defendant.
• Court: U.S. District Court — District of Massachusetts

880 F.Supp.2d 190

Murielle ABDALLAH, Individually and on behalf of all other persons similarly situated, Plaintiff,

v.BAIN CAPITAL LLC, Defendant.

Civil Action No. 11–11904–JLT.

United States District Court,

D. Massachusetts.

July 24, 2012.

Kenneth A. Solomon, Swampscott, MA, Robert Garson, Thomas Segal, Garson, Segal, Steinmetz, Fladgate, LLP, New York, NY, for Plaintiff.

Christopher B. Kaczmarek, David C. Casey, Jeanne M. Barber, Littler Mendelson, Boston, MA, for Defendant.

MEMORANDUM AND ORDER

TAURO, District Judge.

I. Introduction

This case stems from the purchase of a majority interest in Samsonite by an investor pool that included Defendant Bain Capital, LLC (“Bain”). After the purchase of Samsonite, a factory owned by Samsonite in Hénin–Beaumont, France was sold to HB Group and was subsequently shuttered. Plaintiff Murielle Abdallah filed her Class Action Complaint [# 1] against Defendant Bain on November 4, 2011 alleging fraud, tortious interference with employment agreements, violation of Mass. Gen. Laws Ch. 93A § 2(a), and unjust enrichment. Currently before the court is Defendant Bain's Motion to Dismiss [# 9]. For the reasons stated below, Bain's Motion to Dismiss is ALLOWED.

II. Background¹

In 2004, an investors' pool consisting of Defendant Bain, Ares Management, and Ontario Teacher Pension Funds purchased approximately eighty-five percent of Samsonite's outstanding shares for $8 million.²Bain “was the main and active participant of [the] investors' pool....” ³ After acquiring a majority interest in Samsonite, Bain appointed Marcello Botolli as the new CEO of Samsonite.⁴

At the time of the acquisition, Samsonite owned and operated a luggage factory in Hénin–Beaumont, France.⁴ Plaintiff Murielle Abdallah worked at this factory.⁵ In 2005, HB Group, owned and operated by Jean–Jacques Aurel, developed a plan to take over the factory and convert production from Samsonite luggage to solar panels and unbranded luggage.⁶ Bain brought Aurel to Samsonite, and Patrick Lebreton, a Bain executive, attended “every important meeting between Samsonite and Aurel.” ⁷ Under the take-over plan, Samsonite created a wholly-owned subsidiary that consisted of the factory's business activities and assets.⁸

The factory was then sold to HB Group in either July or August of 2005. ⁹ After the sale, the factory operated at a loss, and roughly one year later the factory filed for bankruptcy.⁵ The Tribunal de Commerce of Paris, France ordered the judicial liquidation of the factory on February 15, 2007.⁶

Plaintiff alleges that Bain arranged the sale of the factory to HB Group in order to avoid Samsonite paying the costs associated with a collective redundancy plan, which would have been required had Samsonite closed the factory.⁷ According to Abdallah, under the French Labor Code, any entity employing at least fifty workers that seeks to terminate the employment of at least ten workers must implement a collective redundancy plan.⁸ Such a plan is “designed to assist the workers facing termination, including but not limited to training seminars and conferences, financial and logistical aid to move to a different location to be reallocated to a new position, and psychological support to help the workers during the transition period.” ⁹ Abdallah estimates that had Samsonite shuttered the factory, a collective redundancy plan would have cost it around $75 million.¹⁰ By selling the factory to HB Group, Samsonite avoided paying for such a plan, and Bain was able to sell its shares of Samsonite stock for greater profit.¹¹

The factory workers filed a lawsuit in France against Samsonite, HB Group, Bain Capital, Ares Management, and the Ontario Teacher's Pension Plan. ¹² On June 24, 2008, the Tribunal de Grande Instance “declared the transfer between Samsonite and HB Group null and void as fraudulent[,]” but dismissed the claims against the members of the investors' pool for lack of evidence.¹³ The factory workers also filed a separate suit against Samsonite for illegal termination in France. On December 14, 2008, the Conseil des Prud'hommes of Lens, France found in favor of the workers.¹⁴

On November 4, 2011, Abdallah filed her Class Action Complaint [# 1] individually and on behalf of all other persons similarly situated—the workers from the factory in Hénin–Beaumont, France—in the United States District Court for the District of Massachusetts. The complaint lists the following four causes of action against Bain: (1) fraud; (2) tortious interference with the employment agreements; (3) violation of Mass. Gen. Laws ch. 93A § 2(a); and (4) unjust enrichment, restitution, and constructive trust. Abdallah states that new evidence has recently come to light demonstrating that Bain ordered Lebreton to attend meetings between Samsonite and Aurel, and that Samsonite's representative at those meetings “repeatedly sought Lebreton's assent to the main points of the scheme.” ¹⁵ Bain filed Defendant Bain Capital, LLC's Motion to Dismiss [# 9] on December 5, 2011. Abdallah filed Plaintiff's Memorandum of Law in Opposition to Defendant's Motion to Dismiss [# 12] on December 19, 2011, and Bain filed Reply Memorandum of Defendant Bain Capital, LLC in Support of its Motion to Dismiss [# 14] on January 6, 2012.

III. DiscussionA. Standard of Review

A district court should not dismiss a complaint under Fed.R.Civ.P. 12(b)(6) “if the complaint satisfies Rule 8(a)(2)'s requirement of ‘a short and plaint statement of the claim showing that the pleader is entitled to relief.’ ” ¹⁶ In order for a complaint to withstand a motion to dismiss, however, it “must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face....’ ” ¹⁷ The court accepts as true all factual allegations stated in the complaint. ¹⁸ The court should, nevertheless, disregard all legal conclusions that the plaintiff presents as facts.¹⁹ The claim survives the motion to dismiss if the factual allegations alone “allow[ ] the court to draw the reasonable inference that the defendant is liable for the misconduct.” ²⁰ A complaint that only “pleads facts that are ‘merely consistent with’ a defendant's liability ... ‘stops short of the line between possibility and plausibility of entitlement to relief[,]’ ” ²¹ and should be dismissed. In addition, when a plaintiff alleges fraud, Fed.R.Civ.P. 9(b) requires that the complaint “state with particularity the circumstances constituting fraud or mistake.” ²²

When a motion to dismiss is based on the argument that the claims are time-barred, in order to prevail, “the facts establishing that defense must: (1) be definitively ascertainable from the complaint and other allowable sources of information, and (2) suffice to establish the affirmative defense with certitude.” ²³ Although in most cases, “the question [of] when a plaintiff knew or should have known of its cause of action is one of fact that will be decided by the trier of fact[,]” ²⁴ the case is appropriate for dismissal if no set of facts would entitle the plaintiff to relief.²⁵

B. Statute of Limitations

In this case, Bain's motion to dismiss is based on the argument that each of Abdallah's four claims is time barred. First, Abdallah brings three common law claims: fraud (Count I), tortious interference with the employment agreements (Count II); and unjust enrichment, restitution and constructive trust (Count IV). Under Massachusetts state law, each one of these claims is subject to a three-year statute of limitations from the date upon which the cause of action accrues.²⁶ Second, Abdallah's claim of violation of Mass. Gen. Laws ch. 93A is subject to a four-year statute of limitations from the date the cause of action accrues.²⁷

A cause of action typically accrues at the time the plaintiff suffers the underlying injury.²⁸ Abdallah has proposed three separate doctrines for tolling the statute of limitations until a later date: (1) the discovery rule; (2) Mass. Gen. Laws ch. 260, § 12; and (3) equitable tolling.²⁹ First, the discovery rule tolls the running of the statute of limitations until “a plaintiff ‘knew of should have known of the alleged injury.’ ”³⁰ Stated another way: “Under the discovery rule, a cause of action accrues when a person (1) knows or has sufficient notice that s/he was harmed; and (2) knows or has sufficient notice of the cause of harm.” ³¹ The burden is upon the plaintiff to prove “both the actual lack of knowledge and the objective reasonableness of that lack of knowledge during the tolling period.” ³² For the discovery rule, “[t]he important point is that the statute of limitations starts to run when an event or events have occurred that were reasonably likely to put the plaintiff on notice that someone may have caused her injury.” ³³

The amount of notice necessary to commence the running of the statute of limitations is likely notice of the cause of injury.³⁴ Armed with such “notice, the potential litigant has the duty to discover from the legal, scientific, and medical communities whether the theory of causation is supportable and whether it supports a legal claim.” ³⁵ For example, in Curry v. Simon, a medical malpractice case, the Massachusetts Appeals Court determined that under the discovery rule, “[t]here is no requirement that a plaintiff have notice that the defendant was actually responsible for the injury, only that he or she have knowledge or sufficient notice that the medical care given by the defendant may have caused the injury.” ³⁶ The court focused its reasoning on the fact that that discovery rule was adopted to toll the statute of limitations when the harm was “inherently unknowable” at the time the tortious conduct occurred.³⁷ Because the plaintiff in Curry knew that the defendants treated the plaintiff and knew of the injury when it occurred, the plaintiff was on notice at the time of injury “to investigate with medical professionals whether the defendants' treatment in any way contributed...