Opinion
21-P-778
05-20-2022
MARTIN HANSSMANN v. OYO TOYS, INC.
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 2 3.0
OYO Toys, Inc. (OYO), appeals from a grant of summary judgment for Martin Hanssmann, OYO's former vice-president of operations, on OYO's counterclaims. The underlying action was brought by Hanssmann to recover damages after OYO defaulted on a loan agreement and promissory note. OYO counterclaimed for tortious interference with business relations, "misfeasance," and "breach of loyalty and implied duty of good faith." A Superior Court judge allowed Hanssmann's motion for summary judgment on the counterclaims, concluding that there was no genuine issue of material fact for trial. We agree and thus affirm.
Hanssmann filed a motion for summary judgment on one of his claims (for breach of contract), which was allowed with no opposition. After a damages assessment hearing, judgment entered for Hanssmann on the breach of contract claim, awarding him the principal balance of the promissory note as of January 1, 2019, along with prejudgment interest, attorney's fees, and costs. OYO does not appeal from this aspect of the judgment.
Summary judgment is appropriate if, viewing the evidence in the light most favorable to the nonmoving party, the moving party is entitled to judgment as a matter of law. See Bourque v. Cape Southport Assocs., LLC, 60 Mass.App.Ct. 271, 277 (2004). Where, as here, the moving party will not have the burden of proof at trial, he can prevail on summary judgment by showing that "the party opposing the motion has no reasonable expectation of proving an essential element of that party's case." Kourouvacilis v. General Motors Corp., 410 Mass. 706, 716 (1991). To defeat the motion, the nonmoving party "may not rest on the allegations contained in [its] pleading, but must set forth specific facts showing that there is a genuine issue for trial." Bourque, supra. We resolve "all doubt as to the existence of a genuine issue" in favor of the nonmoving party (quotation omitted). Attorney Gen, v. Bailey, 386 Mass. 367, 371 (1982) .
Even viewing the record in the light most favorable to OYO, we conclude that summary judgment properly entered on the counterclaim for tortious interference with business relations. To prevail on this counterclaim, OYO would have to prove, among other things, that it "had an advantageous relationship with a third party" and that Hanssmann "knowingly induced a breaking of the relationship." Blackstone v. Cashman, 448 Mass. 255, 260 (2007). Hanssmann argued in his motion that OYO had no reasonable expectation of proving these elements for the basic reason that at no point "during the entire course of [the] litigation" did OYO identify "a specific business relationship with which . . . Hanssmann has interfered." Hanssmann submitted an affidavit in support, in which he averred: "Since my disengagement from OYO, I do not know of any business relationship or contracts (whether existing or contemplated) that OYO has with any person or entity. . . . Accordingly, OYO has no business relationship or existing or contemplated contract with which I interfered."
In response to the motion, OYO pointed to an affidavit of its principal owner, David Solomont, which was previously filed in opposition to Hanssmann's request for a preliminary injunction. The only relevant paragraph in Solomont's affidavit states in its entirety: "Defendant has reason to believe that Plaintiff is in discussion with 3rd parties to sell certain assets of the Company, which will cause irreparable harm to the Company and which assets he has no right to sell." We agree with the judge that this does not suffice to create a triable factual issue. "Conclusory statements, general denials, and factual allegations not based on personal knowledge [are] insufficient to avoid summary judgment." Madsen v. Erwin, 395 Mass. 715, 721 (1985), quoting Olympic Junior, Inc. v. David Crystal, Inc., 463 F.2d 1141, 1146 (3d Cir. 1972). See Mass. R. Civ. P. 56 (e), 365 Mass. 824 (1974). 0Y0 does not argue to the contrary on appeal, but instead suggests that it need not identify the third party relationship with particularity because Hanssmann withheld information that "was uniquely within his knowledge." But as 0Y0 acknowledged at the summary judgment hearing, it did not serve any document requests seeking that information; indeed, it is undisputed that 0Y0 conducted no discovery at all on the counterclaims. Thus, because Hanssmann's affidavit was unmet by admissible countervailing evidence, summary judgment was appropriate. See Kourouvacilis, 410 Mass. at 716.
Summary judgment was also appropriate on OYO's counterclaims for misfeasance and breach of loyalty and implied duty of good faith. The factual allegation underlying these counterclaims is that Hanssmann wrongfully transferred $177,758.28 of OYO's funds to himself and his consulting company. Hanssmann refuted this allegation in his affidavit, however, stating that he "did not make payments to [him]self" from OYO's funds, that OYO employed a controller who was "responsible for OYO's financial disbursements," and that "it was OYO's controller who issued the payments to" Hanssmann for his consulting services. To counter these averments, OYO submitted a second affidavit of Solomont; attached to this affidavit was an exhibit that Solomont represented to be OYO's "13 Week Cash Flow Table, from October 13, 2018 through April 27, 2019, which was created in the normal course of business."
We are again in agreement with the judge that the materials submitted by OYO failed to create a genuine issue for trial. Solomont's affidavit provided no explanation of the figures in the cash flow table, which appear to be "projections," and not actual payments. Moreover, even if we assume that the table reflects actual payments, it does not show who made the payments or that they were improper. At most, the table shows that Hanssmann received payments from OYO during that thirteen-week period. This does not establish wrongfulness on Hanssmann's part and does not refute the assertions in his affidavit that the payments were made by OYO's controller in return for Hanssmann's consulting services. Summary judgment thus properly entered. See Kourouvacilis, 410 Mass. at 716.
Hanssmann's request for an award of attorney's fees and costs is denied.
Judgment dated June 25, 2021, affirmed.
The panelists are listed in order of seniority.