Remote exec can bring bias claim against California employer in Massachusetts

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The Massachusetts-based general counsel of a Silicon Valley company can sue her California-based supervisor in Massachusetts for wrongful discharge under Chapter 151B, a U.S. District Court judge has held.

Plaintiff Jennifer Lawrence worked out of her Massachusetts home as GC for defendant Next Insurance and was supervised by the company’s chief executive officer, defendant Guy Goldstein, who lives and works in California.

Ten months after joining the company, Lawrence informed Goldstein in a one-on-one Zoom meeting that she would need to take medical leave to treat her breast cancer.

During the meeting, Goldstein allegedly praised Lawrence’s work and leadership and reassured her that the company “would never fire [Lawrence] for health reasons.”

Four days later, Lawrence learned in another Zoom meeting with Goldstein and an outside counsel that she was being fired for “bullying” and creating a hostile environment, which the outside counsel claimed was based on an “investigation” begun months earlier.

In response to state law retaliation and discrimination claims that Lawrence subsequently brought against both Next Insurance and Goldstein, the CEO moved to dismiss, arguing that he lacked sufficient contacts with Massachusetts to be subject to jurisdiction in the commonwealth.

Judge William G. Young denied the motion.

“The conduct at issue — Goldstein’s firing of Lawrence over Zoom and the virtual interactions that led up to it — is related to Goldstein’s contacts with the forum,” Young wrote. “Goldstein purposefully availed himself of the benefits and protections of Massachusetts law by regularly communicating with and supervising a resident employee to conduct a significant part of his business, and it is reasonable to find jurisdiction here given that Goldstein is the CEO of a company with a subsidiary-owned office in Massachusetts, and which hired a Massachusetts resident as its General Counsel, and because the other reasonableness factors, such as Massachusetts’s interest in applying its antidiscrimination laws to protect its residents, also favor Lawrence.”

Young also denied the motion to dismiss on its merits, finding that the temporal proximity between Lawrence’s medical leave request and her termination plausibly suggested that her protected activity caused her dismissal.

The 49-page decision is Lawrence v. Next Insurance, Inc., et al., Lawyers Weekly No. 02-129-25.

Mail coach age to the internet age

Plaintiff’s counsel Patrick J. Hannon of Boston did not respond to requests for comment. The defendant’s attorneys, Lynne C. Hermle of California and Laura B. Najemy of Boston also did not respond.

Local employment attorneys weighing in on the case, however, said the decision reflects the changing realities of the work world in the post-pandemic era.

“It’s been challenging to apply the law of the dial-up age, never mind the age of the mail coach, to modern workplaces where internet communications are nonstop and rapid,” said Michaela C. May of Cambridge. “A remote employee in Massachusetts or in any state is probably communicating throughout the workday instantaneously in any state where the employer is doing business or has employees. At some point, traditional notions of fair play and justice will require a person who directs their conduct at another state to face litigation in that state.”

May said the employer in Lawrence probably could have avoided a lot of trouble by having a California forum-selection clause.

At some point, traditional notions of fair play and justice will require a person who directs their conduct at another state to face litigation in that state.

“I have problems with those clauses sometimes because they can make litigation more burdensome for employees, but they’re often enforceable,” May said.

May also expressed skepticism that Goldstein’s real goal was to force the plaintiff to litigate in California. Rather, she said, it was more likely that he wanted to make litigation more costly and burdensome for the plaintiff and encourage her to drop him from the suit altogether.

“By challenging jurisdiction, they probably delayed the case six to nine months, even in front of a judge with a reputation for moving cases along in a very quick manner,” she said.

Boston attorney Gavriela M. Bogin-Farber agreed with the ruling while emphasizing that it does not mean there is personal jurisdiction just because an employee lives in Massachusetts.

“There are specific factors that have to be met, and the court summarizes them well,” Bogin-Farber said. “I can understand how employers would be nervous, but it requires a level of intentionality on their part based on who’s supervising whom and who’s doing what work where.”

Matthew J. Fogelman of Newton Center said the decision “just makes sense.”

“Goldstein regularly communicated with and supervised an employee in Massachusetts. The company hired a Massachusetts resident as its general counsel knowing that person was going to be working in Massachusetts. They had multiple virtual interactions where the plaintiff was in Massachusetts. And the combination of all those things leads to this result,” he said. “Should the plaintiff in this case have to sue Goldstein in California because he happens to live there? Why would that be fair?

Remote relationship

Next Insurance, which has its principal place of business in Palo Alto, California, hired Lawrence as its general counsel in March 2022.

During Lawrence’s time at the company, Goldstein supervised her work and held weekly one-on-one Zoom calls with her.

In May 2022, Goldstein apparently told Lawrence of a complaint from a younger female executive that Lawrence was “mean” to her and asked Lawrence to make amends.

In another Zoom call three months later, Lawrence shared concerns about a male executive’s aggressive behavior toward female employees. Goldstein apparently countered that he had heard comments about the plaintiff’s own “mean” behavior but described the specifics as “secret.”

Lawrence allegedly told Goldstein in response that she was worried her gender was causing negative feedback and that she should not be held to a different standard.

Goldstein apparently assured her that any feedback had nothing to do with her gender but it was important that she be liked.

Lawrence later told Goldstein about a female employee’s concerns about the “demeaning behavior” of another male executive. Goldstein allegedly dismissed those concerns while offering Lawrence positive feedback. He also praised her in a December 2022 magazine article.

In a one-on-one Zoom on Jan. 5, 2023, Goldstein complimented Lawrence’s work and leadership. During the meeting, Lawrence shared that she would need to take medical leave and assured him that it would be as short a leave as possible.

Goldstein apparently said in response that Next Insurance would “never fire you for health reasons,” which she says she found strange.

On Jan. 9, 2023, Goldstein, accompanied by outside counsel, fired Lawrence over Zoom. He claimed they had conducted an “emergency 360 review” after the prior meeting and found out she was bullying others.

When Lawrence asked for specifics, Goldstein allegedly said, “Wow, maybe you really don’t know what a bully you are,” and the outside attorney said she had, in fact, begun an investigation months earlier that prompted dismissal.

Lawrence’s lawsuit alleging retaliation and sex and disability discrimination followed, as did Goldstein’s motion to dismiss.

Sufficient contacts

Young found that the court indeed had personal jurisdiction over Goldstein.

Chiefly, he said, all three prongs of the due process test for personal jurisdiction were met: the conduct leading to the suit was related to Goldstein’s contacts with the forum; Goldstein purposefully availed himself of the benefits and protections of Massachusetts law; and it was reasonable to subject him to Massachusetts jurisdiction.

Specifically, Young noted that Goldstein purposefully availed himself of the benefits and protections of Massachusetts law by regularly communicating with and supervising an employee in Massachusetts.

He also said it was reasonable for Goldstein to be subjected to Massachusetts jurisdiction given that he is the CEO of a company with a subsidiary-owned office in Massachusetts and who hired a Massachusetts resident as general counsel.

“The national economy has evolved — especially since the COVID-19 pandemic — such that an individual worker on the far side of the country from her employer can have just as substantial a connection with her supervisor as she would have were they working within the same office building, and perform legal work of a kind and substance that previously would have been performed only by physically present in-house counsel, or perhaps by a firm in another state,” Young said, denying the motion to dismiss. “It would be no more than a thin legal fiction to pretend otherwise.”