Lawson v. FMR LLC

Citation554 F.Supp.3d 186
Decision Date09 August 2021
Docket NumberCIVIL ACTION NO. 19-11222-DPW
Parties Jackie Hosang LAWSON, Plaintiff, v. FMR LLC, dba Fidelity Investments; FMR Corp., dba Fidelity Investments; and Fidelity Brokerage Services LLC, dba Fidelity Investments, Defendants.
CourtU.S. District Court — District of Massachusetts

Jackie Hosang Lawson, Brookline, MA, Pro Se.

William H. Kettlewell, David K. Bastian, Morrison Mahoney LLP, Victoria L. Steinberg, Todd & Weld, Boston, MA, for Defendants.



Plaintiff Jackie Hosang Lawson has returned to this Court pro se with a reconfigured action ("Lawson II ") in the wake of the ultimately unsuccessful pursuit of wrongful discharge and whistleblower retaliation claims she undertook when represented by counsel in an earlier action ("Lawson I ") against the same defendants (collectively "Fidelity"). Lawson II is framed as a putative class action, echoing and amplifying claims arising from the facts and conduct underlying the adverse 2017 final judgment rendered in Lawson I . Fidelity has moved to dismiss Lawson II .


Because Fidelity's overarching contention is that Ms. Lawson's claims in Lawson II are precluded by the final judgment adversely concluding Lawson I , I will review in some detail the factual and procedural background of Ms. Lawson's litigation against Fidelity in Lawson I and Lawson II .

A. Lawson I

In Lawson I, Lawson v. FMR LLC , Dkt. No. 1:08-cv-10466 (D. Mass. Mar 20, 2008), Ms. Lawson brought suit in 2008 against FMR Corp.; its successor, FMR LLC; and their affiliate, Fidelity Brokerage Services, LLC, alleging (i) retaliation under the Sarbanes-Oxley Act, 18 U.S.C. § 1514A ; and (ii) common law wrongful discharge. Both claims arose from her period of employment at Fidelity, during which she reported to her supervisors and to the United States Securities and Exchange Commission ("SEC") potential fraud against shareholders of Fidelity funds as a result of certain expense and cost allocation methodologies she believed to be improper.1 Ms. Lawson alleged that Fidelity retaliated against her because of her whistleblowing activities and that she was constructively discharged. Her employment with Fidelity ended on September 21, 2007.

Ms. Lawson filed complaints with the Occupational Safety and Health Administration ("OSHA") of the Department of Labor, the agency administering the retaliation complaint under the Sarbanes-Oxley Act, on December 20, 2006, April 24, 2007, September 14, 2007, and November 9, 2007. On January 3, 2008, she gave notice to OSHA that she intended to file an action in federal court, initiating years of litigation in Lawson I ultimately resolved by the final judgment I entered in 2017 as to which appellate challenges were exhausted in 2019.

Fidelity vigorously challenged Ms. Lawson's pleadings in Lawson I from the outset but she successfully overcame those challenges in a signal decision by the Supreme Court permitting her to pursue her case on a factual basis. When Fidelity mounted an attack before me on her pleadings as refined in an Amended Complaint, I denied Fidelity's motion to dismiss, holding that she had properly alleged a violation of the Sarbanes-Oxley Act because — although Fidelity was not a publicly held employer — I concluded that the Act also covered employees of certain privately held entities. Lawson v. FMR LLC , 724 F. Supp. 2d 141, 162 (D. Mass. 2010).2 Recognizing the unsettled but determinative quality of my conclusion, I took the unusual step on Fidelity's motion of certifying the question for appeal, Lawson v. FMR LLC , 724 F. Supp. 2d 167 (D. Mass. 2010). The First Circuit disagreed. Lawson v. FMR LLC , 670 F.3d 61, 68 (1st Cir. 2012). The Supreme Court reversed the Court of Appeals and remanded, concluding that Sarbanes-Oxley whistleblower protections extended to employees of private contractors and subcontractors serving public companies. Lawson v. FMR LLC , 571 U.S. 429, 433, 134 S.Ct. 1158, 188 L.Ed.2d 158 (2014).

At the trial I conducted on remand, the jury rejected Ms. Lawson's Sarbanes-Oxley claims on the merits. While simultaneously pressing an appeal from that judgment to the First Circuit, Ms. Lawson also moved for a partial award of attorneys fees related to interlocutory success on the pleadings issue before the Supreme Court. I declined to award fees because Ms. Lawson was not ultimately the prevailing party in the litigation, Lawson v. FMR LLC, 320 F. Supp 3d 249 (D. Mass. 2018). The First Circuit upheld the judgment and the denial of attorneys fees on appeal. Lawson v. FMR LLC, No. 17-2220, 2019 WL 11879029 (1st Cir. Mar. 18, 2019). The Supreme Court denied Ms. Lawson's petition for certiorari, Lawson v. FMR LLC , ––– U.S. ––––, 140 S. Ct. 228, 205 L.Ed.2d 121 (2019) (mem.), bringing finality to Lawson I .

B. Lawson II

Apart from recounting the facts that were at issue in Lawson I concerning the allegedly fraudulent improprieties she reported to supervisors at Fidelity, see supra note 1, and the retaliation she says she faced after whistleblowing about them, Ms. Lawson now further alleges the following in Lawson II :

She claims that Fidelity interfered with OSHA's scheduled investigation in 2007. Based on FOIA documents Ms. Lawson received on November 14, 2018, she alleges collusion between Fidelity's counsel and OSHA to delay the investigation. [Dkt. No. 1, ¶¶ 87, 104]. Ms. Lawson appears also to be accusing OSHA of negligence when withholding documents in Ms. Lawson's FOIA request, suggesting improper influence by Fidelity. Id. ¶¶ 100, 102.

In addition, Ms. Lawson alleges collusion between Fidelity and the SEC. She claims that delay by the SEC in response to her FOIA document request demonstrates its "association-in-fact" with Fidelity in carrying out fraud. Id. ¶ 119. Ms. Lawson suggests that a former Fidelity employee, John Farinacci, who came to the SEC, may have "played any role in the interference of [her] FOIA request." Id. ¶ 122.

Finally, she alleges misconduct by Fidelity's counsel during the Lawson I proceeding; specifically, she says they wrongfully withheld documents during discovery, id. ¶¶ 278, 293, made misrepresentations and untruthful statements, id. ¶¶ 326, 279-83, and engaged in witness tampering by improperly contacting Ms. Lawson's witnesses, intimidating them during depositions, and causing several to refuse to testify, id. ¶ 333–343.

The repackaging in Lawson II of claims having their origins in Lawson I , is most elaborately undertaken through new Counts styled under the civil dimension to the Racketeer Influenced and Corrupt Organization Act ("RICO"), 18 U.S.C. 1962(a)(d). Although the overarching challenge Fidelity mounts to Ms. Lawson's pleading of Lawson II is directed to the question of claim preclusion, a close analysis of the RICO counts and their alleged deficiencies provides the opportunity for a fine-grained consideration of the nature of her current claims. Consequently, after addressing certain threshold procedural questions in Part II, I will begin this Memorandum's claim analysis in Part III with a granular consideration of the RICO claims, including the impact of claim preclusion principles on them, before turning to the impact of claim preclusion principles on the remaining non-RICO counts. That consideration satisfies me that Fidelity's motion to dismiss Lawson II should be granted.


Fidelity's motion to dismiss before me requires sequential consideration of two procedural questions at the threshold.

A. Is It Proper to Consider a Motion to Dismiss Before Class Certification is Addressed?

Initially, I address Ms. Lawson's objection to Fidelity's filing of its motion to dismiss pursuant to Fed. R. Civ. P. 12(b)(6) before class certification of this action under Fed. R. Civ. P. 23(c) has been addressed.3 She argues that I must consider her class certification before the 12(b)(6) motion to dismiss.4 I do not agree.

It is well within a district court judge's discretion to dispose of a motion to dismiss before acting on class certification. As the First Circuit has observed, "[t]he Civil Rules speak of the need to address class certification at ‘an early practicable time.’ Fed. R. Civ. P. 23(c)(1)(A).5 The word ‘practicable’ imports some leeway in determining the timing of such a decision." Danny B. ex rel. Elliott v. Raimondo , 784 F.3d 825, 837 (1st Cir. 2015). The First Circuit thus has recognized that Rule 23 itself provides a judge with flexibility to choose whether to defer the issue of class certification until after summary judgment. Id. at 837-38.

The exercise of discretion in reserving the class certification question is informed by two factors: first, whether an early resolution on the merits "protect[s] both the parties and the court from needless and costly further litigation," Wright v. Schock , 742 F.2d 541, 544 (9th Cir. 1984) ; and second, whether the ruling would prejudice any of the parties, id. at 545. Here, both factors favor addressing the motion to dismiss before certifying the class.

First, because, as I conclude below, Ms. Lawson's entire complaint must be dismissed, the costly determination of class treatment for any claims of other Fidelity brokerage account holders across the nation is avoided. See Foti v. NCO Fin. Sys., Inc. , 424 F. Supp. 2d 643, 647 n.2 (S.D.N.Y. 2006) ("[C]onsideration of the Motion to Dismiss at this time is appropriate, particularly given the considerable expense and ... time of dealing with what is currently requested as a nationwide class that would include tens of millions of people when certain issues may be able to be resolved as a matter of law.").

Second, because I dismiss Ms. Lawson's complaint based on factual circumstances specific to her, there is no unfair prejudice to Ms. Lawson. Even if the class were certified, she herself could not prevail on the merits for the reasons explained in this Memorandum. Indeed, such...

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