Virginia-based employee’s Massachusetts Wage Act and 151B Discrimination Claims Survive Motion to Dismiss

A U.S. District Court judge has denied a motion to dismiss a Virginia-based employee’s Massachusetts Wage Act and 151 discrimination claims, finding that the employer’s Massachusetts headquarters, the employee’s regular communication with Massachusetts-based employees, and the employee’s business travel to Massachusetts was sufficient to state a claim for violation of Massachusetts law.

United States District Court

SUMMARY: (court decision – opens in PDF)

“Plaintiff Craig Wilson, Jr., a former employee of Recorded Future, Inc. (‘Recorded Future’), brings this action against Defendants Recorded Future, Christopher Ahlberg, and Scott Almeida. … Relevant here, Wilson brings a claim against Recorded Future for violations of the Massachusetts Fair Employment Practices Law, G.L.c. 151B, §4(1B) (‘Chapter 151B’) (Count II) and against all Defendants for violations of the Massachusetts Wage Act, G.L.c. 149, §148 (‘Massachusetts Wage Act’) (Count III). … Now pending before the court is Defendants’ Partial Motion to Dismiss [Doc. No. 14] these two claims. …

“Defendants’ argument for dismissal of Wilson’s claims under Chapter 151B and the Massachusetts Wage Act is twofold. First, Defendants contend that whether an out-of-state employee can invoke the protections of either statute turns on Massachusetts’s functional choice-of-law principles, under which an employee’s rights are generally determined by the law of the state that has the ‘most significant relationship’ to his employment. … Second, Defendants argue that Virginia, not Massachusetts, was the ‘locus of [Wilson’s] relationship’ with Recorded Future and that Wilson’s alleged contacts with Massachusetts are insufficient to establish that Chapter 151B and the Massachusetts Wage Act apply. …

“In the context of determining proper venue, the Supreme Judicial Court of Massachusetts ‘do[es] not read G.L.c. 151B so narrowly as to mean that conduct constituting an unlawful termination can occur in only one place.’ Cormier v. Pezrow New England, Inc., 437 Mass. 302, 306, 771 N.E.2d 158, 162 (2002). …

“‘As such, courts have applied 151B in situations where the employment decisions at issue were made in Massachusetts, though their effects were felt in another state.’ …

“Similarly, here, the court finds that Wilson has sufficiently pleaded that unlawful conduct took place, at least in part, in Massachusetts where he alleges that (i) Recorded Future was headquartered in Massachusetts; (ii) he communicated regularly with Recorded Future’s executives and employees located at the Massachusetts office; (iii) Wilson’s employment duties required travel to Boston; and (iv) that decisions related to Wilson’s compensation plans, commission payments, and ultimate termination were made in Recorded Future’s Massachusetts headquarters, where Ahlberg and Almeida (as well as other decision-making executives of Recorded Future) were based.

“Accordingly, the court finds that Wilson has properly brought a claim under Chapter 151B. …

“The Massachusetts Wage Act does not contain a provision expressly foreclosing the statute’s potential extraterritorial application. … As a result, the statute applies extraterritorially — and affords protections to out-of-state employees — so long as Massachusetts has the most significant relationship to the plaintiff’s employment. …

“Defendants dispute that Massachusetts has the most significant relationship to Wilson’s employment where (i) Wilson is not a resident of Massachusetts; (ii) Wilson did not work primarily out of Recorded Future’s Massachusetts office; (ii) neither Wilson’s offer of employment nor his compensation plan provided for the application of Massachusetts law; (iv) neither of Wilson’s supervisors ([Roger] Coehle or [Julie] Starnes) worked out of the company’s Massachusetts headquarters; (iv) Wilson did not actually service customers in Massachusetts; and (vi) Wilson did not hold himself out to customers as being based in Massachusetts. …

“However, as discussed above, there is no requirement that Wilson reside or work in Massachusetts to be afforded the Wage Act’s protections — only that Massachusetts has the most significant relationship with his employment. Wilson does not identify which Recorded Future’s office he primarily worked out of, if any. Although Wilson does not dispute Defendants’ assertion that Wilson’s direct supervisors, Coehle and Starnes, did not work out of the Massachusetts office, it is not clear where they were located or if they worked out of Virginia. Moreover, Wilson alleges that he often interacted with leadership and employees, regularly received support for the company’s sales tools from employees, and from ‘time to time’ attended required trainings located in Massachusetts.

“Accordingly, the court finds, taking all inferences in favor of Wilson at this stage, that as pled and absent further facts, Massachusetts may have the most significant connection to the employment relationship between Wilson and Recorded Future and the Massachusetts Wage Act may apply. …

“For the foregoing reasons, Defendants’ Partial Motion to Dismiss [Doc. No. 14] seeking to dismiss Wilson’s claim against Recorded Future for violations of Chapter 151B (Count II) and Wilson’s claim against all Defendants for violations of the Massachusetts Wage Act (Count III) is denied.”

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