Haverhill Stem LLC v. Jennings

Decision Date19 May 2023
Docket Number22-P-830
PartiesHAVERHILL STEM LLC & another[1] v. LLOYD JENNINGS & another.[2]
CourtAppeals Court of Massachusetts

Summary decisions issued by the Appeals Court pursuant to M.A.C. Rule 23.0, as appearing in 97 Mass.App.Ct. 1017 (2020) (formerly known as rule 1:28, as amended by 73 Mass.App.Ct. 1001 [2009]), are primarily directed to the parties and therefore, may not fully address the facts of the case or the panel's decisional rationale. Moreover, such decisions are not circulated to the entire court and, therefore represent only the views of the panel that decided the case. A summary decision pursuant to rule 23.0 or rule 1:28 issued after February 25, 2008, may be cited for its persuasive value but, because of the limitations noted above, not as binding precedent. See Chace v. Curran, 71 Mass.App.Ct. 258, 260 n.4 (2008).

MEMORANDUM AND ORDER PURSUANT TO RULE 23.0

After an unsuccessful interlocutory appeal from the denial of their special motion to dismiss under the "anti-SLAPP statute," see Haverhill Stem LLC v. Jennings, 99 Mass.App.Ct. 626, 630-635 (2021) (Haverhill Stem I), the defendants, Lloyd Jennings and Brad Brooks again appeal, this time challenging an order denying their renewed motion to dismiss the plaintiffs' complaint based upon the absolute litigation privilege. We affirm.

Our review of a ruling on a motion to dismiss is de novo. See Bassichis v. Flores, 490 Mass 143, 148 (2022). In contrast to an appeal involving a special motion to dismiss under the anti-SLAPP statute, which anticipates review of an evidentiary record, see G. L. c. 231, § 59H; Haverhill Stem I, supra at 627 n.3, we consider only the facts alleged within the four corners of the complaint. See Bassichis, supra. Accordingly, we recite so much of the facts alleged in the verified complaint that are relevant to the litigation privilege defense, accepting "as true all of the facts alleged . . . and [drawing] all reasonable inferences in the plaintiffs' favor."[3] Id.

Seeking to operate a marijuana dispensary in the city of Haverhill (city), Caroline Pineau advocated for zoning changes to the downtown area and began applying for the appropriate licenses to operate an establishment in a building she leased from her father.[4] Her next door neighbors, Lloyd Jennings and Brad Brooks, actively opposed the proposed use.[5] When Pineau called Brooks in October 2018 to discuss her plans, he stated, "[W]ell, you better bet me and my partner are going to get our money back from the deck we built, which is $30,000, and make sure you go through the same hell with the city that we did."[6] To Pineau's suggestion that "they could be good neighbors," Brooks responded, "[N]o, we said whoever bought that building owes us $30,000 and we will fight them every step of the way." A series of meetings ensued in an attempt to settle their differences.

At a meeting requested by Brooks with Pineau and her husband held on November 3, 2018, Brooks and Jennings informed them they were seeking $30,000 "regardless of who bought the building" and that they "would fight whatever Pineau proposes for use of the building."

After this meeting, Brooks and Jennings publicly circulated their demand for money, informing members of the Haverhill downtown community that "the [p]laintiffs owed them $30,000." Several people asked Pineau "why she owes [the defendants] $30,000." Pineau had no debt obligation to Brooks or Jennings.

After the city approved downtown zoning for marijuana establishments in January 2019, Jennings stated to several people around town, "[Pineau] doesn't know who she is dealing with"[7] and "she'll see how Haverhill works." In early March 2019 Pineau approached Brooks requesting another meeting aimed at "[setting] aside their issues."

Accompanied by her attorney, Pineau met with Brooks and Jennings on March 15. Jennings agreed to settle the matter if Pineau paid him "no less than $30,000," gave him sole use of the deck behind 124 Washington Street, see note 6, supra, and agreed not to conduct her cannabis business on the second and third floors of the building. Absent a financial resolution, Brooks and Jennings threatened to bring a "RICO"[8] lawsuit against Pineau. No agreement was reached.

During subsequent negotiations between Pineau's attorney on one side and Brooks and Jennings on the other, Brooks and Jennings increased their cash demand to $50,000 and then to $75,000. Although the parties went back and forth, they were unable to reach an agreement. Brooks and Jennings rejected Pineau's "final" settlement offer on April 3, 2019.

Shortly thereafter, Jennings restarted negotiations, and offered to settle the matter for a $75,000 payment. When Pineau's husband met with Jennings to discuss the offer on April 10, Jennings stated that he had been "insulted by the whole process" and that he "hasn't been shown the respect he deserves." He informed Pineau's husband that while he was still willing to "talk about a deal," that might change because the defendants were meeting with their Boston lawyers the next day "to pursue a RICO lawsuit." Jennings further stated if the defendants were not able to use the deck, "the price would be much higher." Pineau's husband responded that "it was unlikely that they would be able to negotiate about the deck because of the regulations of the Cannabis Control Commission.

Jennings became very angry at that point, stated that he did not care for the Pineaus or their approach, and alleged that they had lied to him. He further stated that "he was prepared to try to destroy the Pineaus and their business before it got off the ground . . . [and that] the Pineaus don't have the money to fight him and he has already won and was prepared to take everything from the [Pineaus], including their house." Throughout this meeting, Jennings reiterated that the Pineaus "didn't know who [they] were messing with when [they] started this." On May 30, 2019, the defendants and a third party filed an action in the Land Court seeking to invalidate the recreational marijuana zoning bylaw. This action followed in short order.[9]

Discussion.

Following a Superior Court order denying the defendants' renewed motion to dismiss, this interlocutory appeal is properly here under the doctrine of present execution.[10] See Haverhill Stem I, 99 Mass.App.Ct. at 635; Marston v. Orlando, 95 Mass.App.Ct. 526, 535 n.22 (2019). The sole issue for determination is whether the litigation privilege, as recently clarified by the Supreme Judicial Court in Bassichis, 490 Mass. at 149-160, overruled Haverhill Stem I, supra at 635-637, and barred this action. In Haverhill Stem I, we decided the litigation privilege defense adversely to the defendants. Given its importance for present purposes, we set out our analysis in detail.

Therein, we first concluded that while some of the plaintiffs' allegations were based on the defendants' petitioning activities, "other significant allegations [were] not," and thus the plaintiffs' claims "survive an anti-SLAPP motion." Haverhill Stem I, 99 Mass.App.Ct. at 631-632. In concluding that the plaintiffs' claims were not based solely on petitioning activity, we reasoned:

"[S]ome of the defendants' statements to the Pineaus cannot reasonably be viewed as relating to the defendants' petitioning activities. . . . [T]he defendants' focus was to obtain money from Pineau that the defendants knew Pineau did not owe to them. It was in this context - seeking the $30,000 - that Jennings made the statements that the Pineaus did not have the money to fight him, that he was preparing to file a RICO claim, and that he 'was prepared to take everything from the Pineaus, including their house.' Those statements were not reasonably related to the defendants' opposition to Pineau's marijuana dispensary. The defendants' opposition to the dispensary through the Land Court litigation could not have led to the defendants obtaining money from the Pineaus through a lawsuit, let alone to causing the Pineaus financial ruin.

Rather, the statements by Jennings, if proved, were part of an extended pattern of threats, made in an effort to coerce payment" (footnote omitted). Id. at 633. Rejecting the defendants' argument that they were merely opposing Pineau's proposed business and negotiating a price to forego their opposition, conduct we found unobjectionable, we concluded that "the complaint describes a concerted and extended effort to coerce Pineau to pay, 'or else' - complete with thinly veiled threats . . . [and] thus adequately describes extortion - coercion by improper means that is designed to reap an economic reward. Such actions, in the business context, can be actionable under c. 93A." Id. at 634. We also rejected the defendants' similar argument that "all Pineau has alleged are hardball negotiating tactics . . . [that are] accepted business practices that cannot be actionable." Id. at 634-635. We reasoned that while "rough and tumble" negotiations are permissible, "the repeated threats alleged here, designed to coerce payment - including threats that portended economic ruin without basis - fell outside any acceptable boundary" separating legitimate petitioning activity from unprotected conduct. Id. at 635.

In addressing the litigation defense, we acknowledged the broad scope of the privilege, which "generally precludes civil liability based on 'statements by a party, counsel or witness in the institution of, or during the course of, a judicial proceeding,' as well as statements 'preliminary to litigation' that relate to the contemplated proceeding." Haverhill Stem I, 99 Mass.App.Ct. at 636, quoting Gillette Co v. Provost, 91 Mass.App.Ct. 133, 140 (2017). Applying a "fact-specific analysis" as to whether the defendants'...

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