Mitchelson v. Aviation Simulation Technology, Inc., Civ. A. No. 80-2654-S.

• Decision Date: 04 May 1983
• Docket Number: Civ. A. No. 80-2654-S.
• Citation: 582 F. Supp. 1
• Parties: Robert MITCHELSON, Plaintiff, v. AVIATION SIMULATION TECHNOLOGY, INC. and the Sippican Corporation, Defendants.
• Court: U.S. District Court — District of Massachusetts

582 F. Supp. 1

Robert MITCHELSON, Plaintiff, v. AVIATION SIMULATION TECHNOLOGY, INC. and the Sippican Corporation, Defendants.

Civ. A. No. 80-2654-S.

United States District Court, D. Massachusetts.

May 4, 1983.

Michael A. Collora, Diane C. Tillotson, Hemenway & Barnes, Boston, Mass., for plaintiff.

Bernard J. Bonn, III, Martha S. Samuelson, Testa, Hurwitz & Thibeault, Boston, Mass., for defendants.

MEMORANDUM AND ORDER

SKINNER, District Judge.

Plaintiff Mitchelson brings this action seeking damages arising out of the acquisition of defendant Aviation Simulation Technology ("AST") by defendant Sippican Corporation ("TSC"). On February 19, 1982, this court granted defendants' motion for summary judgment on Count IV and denied the motion for Counts II and III. The case is presently before the court on defendants' renewed motion for summary judgment on Counts II and III. For a recitation of the facts relevant to this action, see my Memorandum and Order dated February 19, 1982.

TSC acquired all of the outstanding stock of AST on November 29, 1979 pursuant to an agreement with Mitchelson. On that same date, Mitchelson entered into an employment agreement which included an agreement not to compete. An appendix to that employment agreement ("Appendix I"), executed simultaneously, provided either party with the option of terminating the employment agreement, with the exception of the noncompete clauses. It further provided Mitchelson with the right to obtain AST aviation flight simulators from TSC if his employment was terminated. The employment agreement and the sale of the AST stock became final on December 15, 1979. Mitchelson terminated his employment with TSC two days later, on December 17, 1979. Plaintiff alleges that he was forced to sign a contract that substantially changed the provisions in Appendix I when he went to pick up two simulators as provided for in Appendix I on April 14, 1980.

Count II.

Count II alleges liability under M.G.L. c. 93A, §§ 2 and 11 based on the transactions from November 29, 1979 through April 14, 1980. TSC contends that plaintiff's c. 93A claim is a combination of a dispute concerning an employment contract and a dispute concerning securities transaction and as such is outside the scope of c. 93A. In light of the following, I assume without deciding that plaintiff's claim may be divided into its components.

Disputes between employers and employees are outside the scope of c. 93A. Manning v. Zuckerman, 388 Mass. 8, 11-13, 444 N.E.2d 1262 (1983); Weeks v. Harbor National Bank, 388 Mass. 141, 144, 445 N.E.2d 605 (1983). In order to find the cause of action outside of c. 93A, the disputed actions must have occurred while Mitchelson was an employee. Weeks v. Harbor National Bank, 388 Mass. at 144 & n. 2, 445 N.E.2d 605. Mitchelson alleges that the illegal coercion was applied during the hiring process when he sold his stock, prior to the time he became an employee. Further, he alleges that he was illegally coerced to sign a contract modifying Appendix I on April 14, 1980, after the employment relationship had terminated. Taken as a whole, the allegations in Count II may not be characterized fairly as "arising out of an employment contract". Accordingly, defendant's motion for summary judgment is DENIED with respect to that claim.

Defendants further contend that the allegation that TSC failed to disclose material facts about its financial condition describes a securities transaction, and as such is outside the scope of c. 93A. The Massachusetts Supreme Judicial Court has not yet addressed the question of whether a cause of action under M.G.L. c. 93A will lie for alleged securities violations. While c. 93A makes no express reference to liability under the security laws, the Legislature has provided...