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15-P-358 Appeals Court

RASS CORPORATION vs. THE TRAVELERS COMPANIES, INC., & another.

1

No. 15-P-358.

Suffolk. February 24, 2016. - November 10, 2016.

Present: Katzmann, Maldonado, & Blake, JJ.2

Insurance, Coverage, Insurer's obligation to defend, Notice, 

Settlement of claim, Unfair act or practice. Notice, 

Insurance claim. Commercial Disparagement. Trade Secret. 

Libel and Slander. Consumer Protection Act, Insurance, 

Unfair act or practice, Offer of settlement, Damages, 

Attorney's fees. Damages, Libel, Wrongful use of trade 

secret, Consumer protection case, Attorney's fees.

Civil action commenced in the Superior Court Department on 

June 7, 2010. 

Motions for summary judgment were heard by Janet L. 

Sanders, J., and the case was heard by her.

Anil Madan for the plaintiff.

Michael F. Aylward for the defendants.

 

1 Travelers Property Casualty Company of America.

2 Justice Katzmann participated in the deliberation on this 

case prior to his resignation.
2

BLAKE, J. At issue in the present case is whether the 

defendant insurance companies, The Travelers Companies, Inc.,

and Travelers Property Casualty Company of America (collectively 

Travelers), breached their duties to defend, indemnify, and 

settle in good faith, as to their insured, the plaintiff, Rass 

Corporation (Rass). The underlying action, arising out of 

Rass's decision to cut the underlying plaintiff out of its food 

marketing and distribution business, alleged that Rass's 

principal had committed trade libel, defamation, and 

misappropriation of trade secrets. After a three-month delay in 

notice, Travelers agreed to defend the case from that point 

forward under a reservation of rights that disclaimed coverage 

of the trade secrets claim, and subject to Traveler's limit on 

defense counsel's hourly rate. Rass ultimately settled the case

on its own, refusing the insurer's offer to contribute a nominal

amount conditioned on a waiver of Rass's right to seek 

indemnification. Thereafter, Rass commenced the present action 

against Travelers, seeking indemnity for the settlement and the 

reasonable attorney's fees left unpaid by Travelers, and 

alleging violations of G. L. c. 93A.

Following a bench trial in the Superior Court, the judge

allocated $140,000 of the settlement to Travelers for 

indemnification of the covered claims and found that Travelers 

owed an additional $25,000 in reasonable attorney's fees. The 
3

judge also found that Travelers had committed violations of 

G. L. c. 93A based on its commission of unfair claim settlement 

practices. In a summary judgment ruling issued prior to trial, 

the judge rejected Rass's claim for attorney's fees incurred 

prior to its notice of the underlying claim to Travelers.

Before us now on the parties' cross-appeals are challenges to 

the judge's summary judgment ruling, the rulings as to coverage 

of the underlying claims, the judge's allocation of the 

settlement, and the finding of a c. 93A violation, along with 

the judge's related findings as to damages and attorney's fees. 

We affirm.

Background. "We recite the essential facts found by the 

judge, which we accept 'unless they are clearly erroneous,' 

. . . and which the parties do not challenge, supplemented by 

other undisputed information from the record." Boyle v. Zurich 

Am. Ins. Co., 472 Mass. 649, 651 (2015) (Boyle), quoting Weiler

v. PortfolioScope, Inc., 469 Mass. 75, 81 (2014).

1. The underlying lawsuit. Ranbir "Paul" Jaggi has been 

engaged for several years in the sale of food products through 

various corporate entities. In the early 1990s, Jaggi met Neera 

Tulshian, who is a food chemist based in New Jersey, through his 

contact with Nugen, a New Jersey food manufacturing plant. 

Tulshian, while she was at Nugen, and then through her own 

company, IAM International, Inc. (IAM), worked with Jaggi to 
4

convert Jaggi's Indian sauce recipes into a "shelf stable" 

product capable of being sold in jars at grocery stores without 

refrigeration. Over several years, the two had an arrangement

whereby IAM would manufacture shelf-stable simmer sauces, and 

then deliver the product for distribution by Jaggi, through one 

of his own entities or a corporate parent. In 2004, Jaggi 

formed Rass, which is based in Sudbury. Between January of 

2004, and January of 2008, Rass purchased $5,445,968.26 worth of 

simmer sauces from IAM, which it then sold to the Trader Joe's 

grocery store chain. Tulshian's personal tax returns indicate 

that her annual income during that period was about $400,000. 

In 2007, Tulshian learned that Jaggi, with his brother-inlaw, was in the process of setting up his own bottling line that 

could make the sauces. Knowing that his actions would cut 

Tulshian out of the business, Jaggi offered Tulshian a stake in 

the new plant. When that offer failed, Jaggi offered her 

$100,000. She again refused. Anticipating a problem with his 

Trader Joe's account, on November 8, 2007, Jaggi wrote an

electronic mail message (e-mail) to Cara Yokomizo, a buyer at 

Trader Joe's. It states, in relevant part:

"[T]here is an outside chance that the person who is 

handling this co-packing arrangement for us -- Ms.

Neera Tulshian -- may approach you directly for making 

these sauces. Not only will that be unethical but 

illegal as well as these are our recipes created by us 

for Trader Joe's based on our frozen entrée sauces. I 
5

do not foresee that happening but I wanted to give you 

a heads up to avoid any confusion." 

As anticipated, Tulshian contacted Yokomizo and informed 

her that she was the one who had developed the product. 

Yokomizo, in turn, told Jaggi that he should contact 

Tulshian and resolve the issue. 

Having learned of the e-mail to Trader Joe's, Tulshian 

retained an attorney, who sent Rass a demand letter dated 

December 7, 2007. After negotiation attempts between Jaggi and 

Tulshian failed, on January 9, 2008, IAM filed a complaint in 

the Superior Court of New Jersey alleging misappropriation of 

trade secrets, tortious interference with present and 

prospective economic advantage, and trade libel. Under the 

count entitled trade libel, the complaint alleges that Jaggi's 

statements in the e-mail "constitute trade libel, trade 

disparagement, and defamation." Jaggi responded by seeking the 

advice of his own local Massachusetts attorney, and by hiring

New Jersey attorney Emery Mishky to defend the IAM lawsuit. 

Mishky agreed to defend the case at a rate of $275 per hour. 

At all relevant times, Rass was insured by a commercial 

general liability policy issued by Travelers. The policy 

covered, among other things, claims against the insured for 

"[o]ral, written, or electronic publication of material that 

slanders or libels a person or organization or disparages a 
6

person's or organization's goods, products, or services." The 

policy also required Travelers "to defend the insured against 

any 'suit' seeking [covered] damages." 

On March 6, 2008, Rass notified Travelers of the New Jersey 

lawsuit. A Travelers senior technical specialist, John Banks, 

responded by letter dated March 19, 2008. It states that "a 

potential for coverage" exists under the policy, and that 

Travelers agrees to defend Rass subject to a reservation of its

rights "to deny indemnification for any alleged acts which do 

not fall within the enumerated personal injury offense . . . or 

[fall within] any of the exclusions [listed in the policy]." In 

the letter, Travelers also disclaimed coverage for any claim

related to the trade secrets allegations, but acknowledged that

the claims based on the e-mail to Trader Joe's obligated

Travelers to defend the action. Finally, Travelers agreed to 

have Mishky remain on the case, but unilaterally set a rate of 

payment of $200 per hour. 

Throughout the duration of the underlying case, Mishky 

regularly reported to the Travelers personnel assigned to the 

case, including Banks; Amy Baker, a claims adjustor in

Travelers's major case unit specializing in business torts; and 

John Scott, an attorney from a New Jersey law firm retained as 

independent monitoring counsel. Despite Tulshian's claim of

$675,000 in lost profits and Baker's acknowledgment that no 
7

policy exclusions applied, Mishky's initial assessment of IAM's 

case was that Travelers had minimal exposure. As for the claims

arising out of the e-mail, Mishky applied a common-law 

defamation analysis. The pretrial reports and notes indicate 

that he thought it was defensible on the grounds that the e-mail 

was limited in its publication and expressed only Jaggi's 

opinion, and because a qualified privilege could apply to the 

statements made. On the trade secrets claim, Mishky pointed to 

the fact that Tulshian had done nothing to protect any trade 

secret she claimed as hers, and the fact that the sauces were 

made from generic Punjabi recipes that Jaggi had supplied to 

Tulshian. Nevertheless, as the case neared a July 21, 2009,

trial date, in a report dated May 20, 2009, Mishky predicted a 

possible verdict of $100,000 to $500,000, recommended a 

settlement range of $100,000 to $150,000, and indicated that the 

chance of a defense verdict was fifty to seventy-five percent.

On the July 21, 2009, trial date IAM dropped its demand 

from $675,000 to $200,000, and then to $175,000. Extensive 

settlement discussions occurred between IAM and Rass, with 

communications to Travelers inquiring about contribution.

Travelers first offered $10,000 on the condition that Rass waive 

its right to dispute Mishky's reasonable hourly rate. When that 

offer was rejected, Travelers made a second offer of $20,000 on 

the condition that Rass waive its right to seek indemnification 
8

under the policy. Rass likewise rejected that offer and, not 

wanting to lose the opportunity to avoid trial, settled the case 

for $175,000 without any contribution from Travelers. 

2. The present action. Having settled the New Jersey case 

on its own, Rass filed a complaint in the Superior Court on June

7, 2010, alleging that Travelers had breached its contract and 

had committed unfair or deceptive acts in violation of G. L.

c. 93A, § 2.

3 Following discovery, Rass moved for partial 

summary judgment as to liability on the settlement and 

attorney's fees, while Travelers sought a summary judgment 

ruling limited to its obligation to pay the attorney's fees Rass 

incurred prior to its March 6, 2008, notice to Travelers of the 

underlying claim. The judge allowed Travelers's motion and 

denied Rass's. 

A bench trial was held over multiple days in October and 

November, 2012, at which Jaggi, Baker, and Mishky testified. 

Rass also hired New Jersey attorney Gregg Paradise, a specialist 

in intellectual property law, who testified as an expert for 

Rass on the reasonableness of the settlement and provided his 

opinion of the viability of IAM's claims under New Jersey law. 

The focus of Paradise's and Mishky's testimony was that Rass's 

 

3 The judge's finding that two additional counts, claiming 

breach of the implied covenant of good faith and fair dealing 

and common-law bad faith, were duplicative of the c. 93A claim 

is not disputed on appeal. 
9

settlement was reasonable because IAM had a viable trade 

disparagement claim4 based on the contents of the e-mail. 

Counsel for Travelers and Baker, the major case unit adjuster,

who is also an attorney, disputed that a trade disparagement 

claim would be covered under Jaggi's policy because the e-mail 

did not "disparage[] a person's or organization's goods, 

products, or services" as provided in the policy language but, 

rather, disparaged Tulshian herself, or her ownership of the 

sauces. Counsel for Travelers also emphasized the absence of 

any written records generated prior to the settlement 

discussing, or even mentioning, trade disparagement.

Looking at the facts known to the parties at the time of 

the settlement, the judge concluded that "Rass has proved by a 

preponderance of the evidence that the settlement in large part 

(but not entirely) reflected Rass's exposure to plaintiffs' 

claims for lost profits due to the Trader Joe's e-mail and that 

these claims were covered." The judge accordingly found that 

Travelers had breached its contractual duties by failing to 

contribute $140,000 to the $175,000 settlement. On the 

attorney's fees issue, the judge found that there was little 

dispute that Mishky's hourly rate of $275 was reasonable, and 

 

4 Although IAM's complaint states a claim for both trade 

libel and trade disparagement, the phrases are interchangeable. 

We shall use the phrase trade disparagement for the remainder of 

the opinion. 
10

awarded Rass damages for the difference that Travelers had 

failed to pay, which amounted to $25,000. 

Assessing Travelers's conduct in relation to the 

requirements of G. L. c. 176D, § 3(9), the judge found

Travelers's failure to contribute to the settlement, and its

failure to pay Mishky's reasonable attorney fees, to be unfair 

and unreasonable in the face of the facts known to it and 

reasonably available at the time and, therefore, to constitute a 

violation of G. L. c. 93A. Rass subsequently requested

attorney's fees totaling $676,302.77. The judge awarded half 

that figure, criticizing counsel for his obfuscating trial 

tactics and noting that he had repeatedly filed frivolous and 

unnecessary motions. After incurring more legal expenses for 

work related to bringing the case to final judgment, Rass 

submitted an additional motion for an updated fee award seeking 

another $29,997.94. The judge summarily denied the motion, 

citing the reasoning stated in Travelers's opposition. These 

appeals followed. Additional facts will be set forth as 

necessary.

Discussion. 1. Standards of review. "The standard of 

review of a grant of summary judgment is whether, viewing the 

evidence in the light most favorable to the nonmoving party, all 

material facts have been established and the moving party is 

entitled to a judgment as a matter of law." Augat, Inc. v.
11

Liberty Mut. Ins. Co., 410 Mass. 117, 120 (1991). See Mass. R.

Civ. P. 56(c), as amended, 436 Mass. 1404 (2002). As to the 

parties' remaining claims, we are bound by the trial judge's 

findings of fact, including all reasonable inferences, that are 

supported by the evidence. Twin Fires Inv., LLC v. Morgan 

Stanley Dean Witter & Co., 445 Mass. 411, 420 (2005) (Twin 

Fires). T.W. Nickerson, Inc. v. Fleet Natl. Bank, 456 Mass.

562, 569 (2010). Such findings will only be set aside if 

clearly erroneous. Mass. R. Civ. P. 52(a), as amended, 423 

Mass. 1402 (1996). "The judge's legal conclusions are reviewed 

de novo." Anastos v. Sable, 443 Mass. 146, 149 (2004).

2. Breach of contract. a. Duty to pay pre-notice defense 

costs. On Travelers's motion for partial summary judgment, the 

judge concluded that Travelers had no duty under the policy 

language to pay for the defense costs Rass incurred prior to 

notifying Travelers of the underlying claim.

5 We agree with the 

judge's ruling. 

When an insured fails to comply with its contractual 

obligation to provide prompt notice of a claim, it is well 

settled that, unless prejudiced, an insurer nevertheless has a 

duty to defend the insured. Boyle, 472 Mass. at 655-658. There 

 

5 Our analysis on the summary judgment claim is limited to 

the undisputed facts related to Rass's delayed notice of the 

claim to Travelers, and Travelers's refusal to pay the fees 

incurred prior to its receipt of that notice.
12

is no equivalent body of case law in Massachusetts addressing 

the related question of when an insurer's obligation to fund 

that defense begins. The issue has been examined, however, in 

the Federal District Courts, and in other States, where the 

consensus is that the insurer bears no such obligation until 

notice is received. See Hoppy's Oil Serv., Inc. v. Insurance

Co. of N. Am., 783 F. Supp. 1505, 1509 (D. Mass. 1992) ("No duty 

to defend or to participate in a defense can arise before the 

insurer has notice of the suit against the insured, or at least 

of the underlying claim and the likelihood of suit"); American 

Mut. Liab. Ins. Co. v. Beatrice Cos., Inc., 924 F. Supp. 861, 

872 (N.D. Ill. 1996) (applying Massachusetts law) (Beatrice 

Cos.); Windt, Insurance Claims & Disputes § 4:44, at 327-334

(6th ed. 2013) (Windt). 

The reasoning supporting the majority position is 

persuasive. First, an insurer cannot be aware of a duty to 

defend an insured until notice is given. It would be 

irrational, then, to conclude that the insurer could breach that 

duty at a point when it is unaware that the duty exists. 

Second, when an insurer receives late notice, it is unable to

control or minimize costs that have already been incurred. See

generally MacInnis v. Aetna Life & Cas. Co., 403 Mass. 220, 223 

(1988) (notice of claim provision exists for purpose of allowing 

insurer to protect its interests); Augat, Inc. v. Liberty Mut.
13

Ins. Co., 410 Mass. 117, 123 (1991) (where notice of claim did 

not occur until after underlying settlement had been executed 

and judgment entered, insurer not liable under policy, 

regardless of prejudice, because "it was too late for the 

insurer to act to protect its interests"). Here, during the 

three-month delay, Travelers was unable to recommend counsel, 

negotiate a fee rate, or take other steps to protect its 

interests and minimize losses.

Finally, if the opposite result were reached, an insured 

could be incentivized to delay providing notice so as to control 

its own defense for as long as possible, knowing that, absent 

prejudice, the insurer would have to cover the bill for 

reasonable defense costs. See Beatrice Cos., supra at 873-874 

("There are tactical reasons why an insured may want to withhold 

the defense from an insurer that clearly covers a risk. For 

example, especially in a high profile case, an insured may not 

want to lose control of events to the insurer").

For all of these reasons, the judge properly allowed 

Travelers's partial motion for summary judgment on the issue of 

defense costs incurred prior to notice.

6

 

6 We reject Rass's alternative argument that Travelers 

became bound to pay the prenotice defense costs on the ground of 

waiver due to Travelers's inadvertent payment of a portion of 

Mishky's prenotice fees. To establish waiver, Rass must to 

demonstrate that the payment amounted to the intentional 

relinquishment of a known right. See Rotundi v. Arbella Mut. 
14

b. Duty to indemnify. Because the underlying case did not 

proceed to judgment, but settled, Travelers's liability under 

the policy and, in turn, its duty to indemnify Rass for covered 

losses were not determined on the record in the underlying case.

7 

In such instances, the court is left to determine an insurer's 

duty to indemnify by looking to the basis for the settlement; 

i.e., whether any portion of the settlement was made in 

compensation for the acts alleged in the underlying complaint, 

and, if so, whether those acts are covered under the policy 

language. See Travelers Ins. Co. v. Waltham Indus. Labs. Corp., 

883 F.2d 1092, 1099 (1st Cir. 1989); Windt, supra at § 6:31, at 

312. If any part of a settlement is for covered claims, the

court is then charged with allocating the settlement between 

covered and noncovered claims. See Allmerica Fin. Corp. v. 

Certain Underwriters at Lloyd's, London, 81 Mass. App. Ct. 674, 

681 (2012) (remanding matter for, inter alia, allocation of 

damages between claims covered by insurance and those not 

covered by insurance) (Allmerica). 

 

Ins. Co., 54 Mass. App. Ct. 906, 907 (2002). The record is 

devoid of any facts supporting such an argument. 

7 When an underlying complaint is tried to a jury, the judge 

may assist the process of allocating covered and uncovered 

claims by providing the jury with a special verdict form. See 

Liquor Liab. Joint Underwriters Assn. of Massachusetts v. 

Hermitage Ins. Co., 419 Mass. 316, 323 (1995).
15

The relevant inquiry in determining an insurer's obligation 

in these circumstances is "how the parties to the settlement 

viewed the relative merits of the plaintiff's claims at the time 

of the settlement and whether, if the insured settled without 

the carrier's approval, the settlement amount was reasonable." 

Windt, supra at § 6:31, at 310-311. See American Home Assur.

Co. v. Libbey-Owens-Ford Co., 786 F.2d 22, 31 (1st Cir. 1986) 

(noting on issue of allocating settlement that court "should 

accept whatever evidence is available regarding the intent 

behind the settlement decision"); Luria Bros. & Co. v. Alliance 

Assur. Co., 780 F.2d 1082, 1091 (2d Cir. 1986) (insured need not 

establish actual liability, so long as potential liability is 

shown to exist on facts known to insured at time of settlement);

Nordstrom, Inc. v. Chubb & Son, Inc., 820 F. Supp. 530, 535 

(W.D. Wash. 1992) ("An insurer is not entitled . . . to relitigate an underlying action following a settlement"). See 

also Allmerica, supra.

As for the burden of proof, it rests with the insured, here 

Rass, to prove "the compromise of claims that were covered by 

the general insuring clause." Continental Cas. Co. v. Canadian 

Universal Ins. Co., 924 F.2d 370, 376 (1st Cir. 1991), quoting 

from Windt, supra at § 6.29, at 351.

8 

 

8 Rass argues that, based on Travelers's failure to pay 

Mishky his reasonable hourly rate of $275, Travelers breached 
16

Having set out a legal framework, we turn to the issues

before us. Here, the judge determined that Rass reasonably 

settled the IAM case based on its probable liability for both 

the e-mail claims and the trade secrets claim. Having 

determined that the e-mail claims were covered, but the trade 

secrets claim was not, the judge assigned an allocation. On 

appeal, the parties agree that the claim for misappropriation of 

trade secrets is not covered under the policy and, therefore, 

Travelers has no duty to indemnify whatever portion of the 

settlement is attributable to that claim. As to the claims of 

defamation and trade disparagement arising from the e-mail, 

however, the parties' positions diverge. While both agree that 

defamation is covered under the policy, and that the e-mail may 

be understood to support a claim for defamation, Travelers 

maintains that, at the time of settlement, the affirmative 

 

its duty to defend and, in so doing, shifted the burden of proof 

from the insured to the insurer. While Rass is correct that a 

breach of the duty to defend causes the burden to shift, see

Polaroid Corp. v. Travelers Indem. Co., 414 Mass. 747, 764

(1993), no such breach occurred here. Unlike Polaroid, 

Travelers defended the suit against Rass, albeit at a lower 

hourly rate, with no resulting prejudice incurred by Rass as a 

result of the payment dispute. See ibid. (burden of proof 

should shift to insurer "[b]ecause an insurer should be liable 

for the natural consequences of a breach of contract that places 

its insured in a worse position"). The only consequence flowing 

to Travelers in unilaterally setting the lower rate is its 

liability to Rass for the difference between the amount paid and 

the amount owed under the reasonable rate, which the judge found 

and is undisputed on appeal. See Citation Ins. Co. v. Newman, 

80 Mass. App. Ct. 143, 144 n.4 (2011). 
17

defenses to the defamation claim were considered to be so strong 

that little if any portion of the settlement can be allocated to 

that claim. Travelers also maintains that, while liability for 

the tort of disparagement is covered under the policy, the email cannot be understood as giving rise to such a claim or as 

falling within the policy coverage. Thus, Travelers argues that

no portion of the settlement can be attributed to the 

disparagement claim. Rass, for its part, asserts that it faced

no liability for misappropriation of trade secrets, and that the 

judge should have allocated the entire settlement to the e-mail 

claims. 

We conclude that the e-mail gave rise to a covered 

disparagement claim as well as a covered defamation claim, and

we discern no reason to disturb the judge's allocation of the 

settlement as between the e-mail claims and the trade secrets 

claim. We address each point, in turn.

i. Viability and coverage of the e-mail related claims. 

Travelers argues that the statements made in the e-mail do not 

support a claim for trade disparagement because Jaggi's 

statements concern Tulshian's ownership of the sauces, but do

not disparage their quality. Travelers also argues that a 

disparagement claim under this set of facts is not a claim for 

disparagement of "goods, products, or services," as required by 

the language of the policy. The arguments fail, as the relevant 
18

case law, facts, and policy language support coverage for the 

disparagement claim, as well as the defamation claim. 

Disparagement and defamation are distinct torts. See 

generally Dairy Stores, Inc. v. Sentinel Publishing Co., 104 

N.J. 125, 133-134 (1986), citing Prosser & Keeton, Torts § 111, 

at 771, and § 128, at 962-964 (5th ed. 1984) (Prosser & Keeton).

9 

Disparagement, or trade libel, requires proof of a publication 

of a false statement "derogatory to the quality of a plaintiff's 

business, of a kind calculated to prevent others from dealing 

with [her], or otherwise to interfere adversely with plaintiff's 

relations with others." Patel v. Soriano, 369 N.J. Super. 192, 

246-247 (App. Div. 2004). "The communication must be made to a 

third person and must play a material part in inducing others 

not to deal with plaintiff." Id. at 247. Defamation, on the 

other hand, requires a statement that "is false, communicated to 

a third person, and tends to lower the subject's reputation in 

the estimation of the community or to deter third persons from 

associating with him." Lynch v. New Jersey Educ. Assn., 161 

N.J. 152, 164-65 (1999), citing Restatement (Second) of Torts 

§§ 558, 559 (4th ed. 1977). "[T]he threshold issue in any 

defamation case is whether the statement at issue is reasonably 

susceptible of a defamatory meaning." Printing Mart-Morristown

 

9 As the underlying lawsuit was filed in New Jersey, the 

parties do not dispute the application of its laws to the issue 

of coverage of the claims set out therein. 
19

v. Sharp Electronics Corp., 116 N.J. 739, 765 (1989). Simply 

put, disparagement concerns the reputation of a business, while 

defamation concerns an individual's personal reputation in the 

community. 

Depending on the individual facts involved in any given 

case, there can be a significant overlap in the causes of 

action. See Prosser & Keeton, supra at 964-965 (noting that 

"[m]any statements effectuate both harms"); Dairy Stores, Inc. 

v. Sentinel Publishing Co., supra at 133 (noting overlap in 

causes of action); Patel v. Soriano, supra at 248 (same). Such 

is the case here, where, as the judge found, and we concur, the 

statements went to both personal and business reputation. 10 In 

the e-mail, Jaggi insults Tulshian's personal reputation by 

falsely stating that Rass owns the sauces and by calling her 

actions "illegal" and "unethical." The statements also concern 

her business dealings through her company. As the principal of 

IAM, Tulshian was the face of the company, and a personal insult 

to her equally could be seen as a disparagement of the 

"character" of her business organization that would prevent 

 

10 We are in as good a position as the judge to read the email and determine if coverage is triggered based on its 

contents. We add, nonetheless, that our reading and 

interpretation accords with that of the judge.
20

others from doing business with her.

11 See Prosser & Keaton, 

supra at 964. Because a statement about a business, itself, may 

fall within the realm of disparagement, Travelers's arguments 

about the absence of any disparagement of the product's quality

are irrelevant.

12 In sum, the e-mail gave rise to possible 

defamation and disparagement claims.

13 

As to coverage for disparagement, Travelers argues that 

because IAM's business with Rass was not a "good, product or 

service" disparaged by Jaggi's e-mail, any trade disparagement 

 

11 As aptly stated by the judge: "[T]he Trader Joe's email 

was impossible to deny: it was admittedly sent and it said what 

it said. If the email were simply seen as a way to besmirch 

Tulshian's personal reputation, then she would be hard-pressed 

to show damages. But the email did more than that, targeting 

Tulshian's business and disparaging her products. Its message 

was also clear: Trader Joe's should not deal with Tulshian or 

IAM directly."

12 Travelers cites Heritage Mut. Ins. Co. v. Advanced 

Polymer Tech., Inc., 97 F. Supp. 2d 913 (S.D. Ind. 2000), in its 

brief in support of the proposition that insurers should bear no 

responsibility for covering claims involving a dispute over 

ownership or title under a policy providing coverage for the 

disparagement of goods, products, or services. The case is 

inapposite, as there was no allegation that the insured in that 

case had disparaged the character of the opposing party's 

business or product. It was for that reason that the court held 

that no coverage existed under similar policy language. See id. 

at 931-933. 

13 Travelers makes much of the fact that, prior to the 

present action, everyone involved viewed the e-mail as only 

giving rise to a highly defensible defamation claim. Whether 

there were defenses, however, is relevant only to the extent 

that Travelers can show that Jaggi thought the defamation claims 

were so defensible that he settled only due to his liability on 

the trade secrets claim. That showing has not been made, and is 

contrary to the facts found. 
21

claim is not covered under the language of the policy. "It is

. . . appropriate, in construing an insurance policy, to 

consider what an objectively reasonable insured, reading the 

relevant policy language, would expect to be covered." Hazen 

Paper Co. v. United States Fid. & Guar. Co., 407 Mass. 689, 700 

(1990). "If there are two rational interpretations of policy 

language, the insured is entitled to the benefit of the one that 

is more favorable to it." Ibid. In this case, where Jaggi 

called into question the legal status of any sauces Tulshian 

might produce, and viewing the policy in Rass's favor, an 

objective and reasonable policyholder would expect any 

disparagement claim arising from those facts to be covered under 

the policy language.

14

Accordingly, we conclude that all claims arising out of the 

e-mail were covered under the relevant policy language.

ii. Allocation. Based on the undisputed record and 

credible testimony, the judge allocated eighty percent, or 

$140,000 of the $175,000 settlement, to the e-mail-related 

claims, with the remainder to the trade secrets claim. Upon an 

extensive review of the record and the judge's findings, we see 

no reason to disturb the allocation reached. 

 

14 Although we review the coverage question de novo, we note 

that we reach the analogous conclusion as the judge.
22

Several facts point to the strength of the claims raised by 

the e-mail, and Rass's consideration of them at the time of the 

settlement. First, Rass knew that IAM was seeking $675,000 in 

losses. That figure could be directly related to the e-mail, 

which impeded Tulshian and IAM from selling to Trader Joe's. In 

other words, unlike the trade secrets claim, the e-mail claims 

were supported by direct evidence linking Rass to IAM's lost 

business. Mishky's pretrial analysis reflected this concern, 

with a predicted possible verdict of $100,000 to $500,000 and a 

recommended settlement range of $100,000 to $150,000. Second, 

and particularly telling of Rass's state of mind on July 21, 

2008, is the fact that the settlement included, at Tulshian's

urging, a condition that Rass recant its prior statement to 

Trader Joe's, but included no assignment of any trademark, trade 

secret, or other right. 

The record likewise supports the judge's conclusion that 

the trade secrets claim formed some small basis for the 

settlement. Contrary to Rass's assertions that it faced no 

liability for trade secrets, the four counts related to trade 

secrets all survived until trial, which was scheduled to 

commence on the day the settlement was reached. Mishky, who 

testified on behalf of Rass at trial, noted that any claim that 

reaches a jury carries some risk, and that the trade secrets 

claim carried a five to ten percent chance of a plaintiff's 
23

verdict. Mishky's testimony reflects the fact that a jury can 

and often does act unpredictably, and a settlement of claims 

reflects a compromise to avoid exposure at trial. See generally

Reading Co-Op. Bank v. Suffolk Constr. Co., 464 Mass. 543, 551 

(2013); Curcuru v. Rose's Oil Serv., Inc., 66 Mass. App. Ct.

200, 217 (2006). 

3. General Laws c. 93A. In its cross-appeal, Travelers 

disputes the judge's finding of a violation of G. L. c. 93A. 

Rass, on the other hand, argues that multiple damages are 

warranted based on Travelers's actions, and that the judge erred 

in reducing its award of attorney's fees, and in declining to 

award supplemental attorney's fees.

a. Violation of c. 93A based on unfair claim settlement 

practices. Liability under G. L. c. 93A, § 2, is based upon the 

employment of "unfair or deceptive acts or practices in the 

conduct of any trade or commerce" while G. L. c. 176D, § 3, sets 

forth unfair acts or practices specific to the insurance 

industry. See Silva v. Steadfast Ins. Co., 87 Mass. App. Ct.

800, 803 (2015) (Silva). Among those practices enumerated in 

c. 176D, § 3(9), are unfair claim settlement practices, 

including: 

"(d) [r]efusing to pay claims without conducting a 

reasonable investigation based upon all available 

information; . . .
24

"(f) [f]ailing to effectuate prompt, fair and 

equitable settlements of claims in which liability has 

become reasonably clear; [and] 

"(g) [c]ompelling insureds to institute litigation to 

recover amounts due under an insurance policy by 

offering substantially less than the amounts 

ultimately recovered in actions brought by such 

insureds." 

G. L. c. 176D, § 3(9), as amended by St. 2012, c. 208, § 21. "A 

violation of G. L. c. 176D, § 3(9), itself establishes a 

violation of G.L. c. 93A unless the injured party is 'engage[d] 

in the conduct of any trade or commerce.' See G. L. c. 93A, 

§§ 9(1), 11." Boyle, 472 Mass. at 661. In that case, as here,

a violation of c. 176D, § 3(9), provides evidence of an unfair 

or deceptive practice in violation of c. 93A, but is not 

conclusive. See Silva, supra at 803-804, citing Northern 

Security Ins. Co. v. R.H. Realty Trust, 78 Mass. App. Ct. 691, 

696 n.12 (2011). "[W]hether a particular set of acts, in their 

factual setting, is unfair or deceptive is a question of fact," 

which we review for clear error. See Klairmont v. Gainsboro 

Restaurant, Inc., 465 Mass. 165, 171 (2013), quoting Casavant v.

Norwegian Cruise Line Ltd., 460 Mass. 500, 503 (2011).

The judge made the following findings of fact in support of

her conclusion that Travelers had committed unfair claim 

settlement practices in violation of c. 93A. First, Travelers, 

by its statements and conduct, acknowledged that it would be 

required to indemnify Rass if IAM prevailed on its e-mail-
25

related claims.

15 At that time Travelers also was aware, or 

should have been aware, based on its duty to investigate, of the 

strength of the e-mail-related claims and Rass's likely exposure 

to a judgment in the six figures. Nevertheless, Travelers 

offered a settlement contribution far below Rass's likely 

exposure. Second, Baker attempted to condition that inadequate

contribution on a waiver of Rass's right to seek attorney's fees 

or indemnification. By these acts, Travelers failed to 

effectuate a fair and equitable settlement of claims in which 

liability had become reasonably clear. See G. L. c. 176D, 

§ 3(9)(d), (f). Third, by surrendering control of the defense

to the insured under a reservation of rights, yet at the same 

time refusing to pay Mishky's hourly rate, which was reasonable, 

Travelers unfairly compelled Rass to seek the unpaid fees 

through litigation.

16 See G. L. c. 176D, § 3(9)(g). See also 

 

15 In so finding, the judge clarified that Travelers's acts 

were not the result of a plausible, good faith, yet ultimately 

incorrect interpretation of the policy at issue. Contrast 

Premier Ins. Co. of Massachusetts v. Furtado, 428 Mass. 507, 510 

(1998), citing Gulezian v. Lincoln Ins. Co., 399 Mass. 606, 613 

(1987).

16 Quoting from another decision of the Superior Court, the 

judge sensibly observed that "an insurer cannot reserve its 

rights and thereby surrender control of the defense, and still 

reasonably expect that it will pay the same amount of legal fees 

that it would have paid had it accepted coverage and retained 

control of the defense. Through its reservation of rights, the 

insurer's duty to defend is transformed into a duty to reimburse 

its insured for reasonable attorney's fees incurred by the 

insured's chosen counsel." 
26

Citation Ins. Co. v. Newman, 80 Mass. App. Ct. 143, 144 n.4 

(2011) ("reasonable charges are to be assessed with reference to 

market rates; an insurer may not insist on paying only the 

discounted rate it has been able to negotiate with its panel of 

attorneys"). 

The findings are well supported by the record, and 

demonstrate a pattern of unfair conduct on the part of Travelers

in violation of both c. 176D and c. 93A. See R.W. Granger & 

Sons, Inc. v. J & S Insulation, Inc., 435 Mass. 66, 75-78

(2001); MT "Baltic Commander" Schiffahrtsgesellschaft MBH & Co.

KG v. Massachusetts Port Authy., 918 F. Supp. 2d 105, 113-114

(D. Mass. 2013).

b. Willful or knowing violation. General Laws c. 93A, 

§ 11, provides that, upon a finding of a violation of c. 93A, 

"recovery shall be in the amount of actual damages; or up to 

three, but not less than two, times such amount if the court 

finds that the use or employment of the method of competition or 

the act or practice was a willful or knowing violation"

(emphasis added). To be wilful or knowing, a violation need not 

be malicious, but must constitute more than negligence. Within 

that range is conduct that is "intentionally gainful," McGonagle

v. Home Depot U.S.A., Inc., 75 Mass. App. Ct. 593, 600 n.9 

(2009), or demonstrates a wilful recklessness or conscious, 
27

knowing disregard for its likely results, see Gore v. Arbella 

Mut. Ins. Co., 77 Mass. App. Ct. 518, 531-532 (2010).

Here, noting "the last minute nature of the demand . . .

coupled with Travelers's earlier reliance on Mishky's 

evaluations" the judge declined to find a wilful or knowing

violation justifying multiple damages. That conclusion comports 

with the judge's findings of negligence on the part of Travelers 

relative to its investigative obligations, and in its reliance

on Mishky's overly optimistic reports. Yet, as to the 

settlement contribution offered, and the refusal to pay Mishky's 

hourly rate, the judge characterized Travelers's tactics as

exerting leverage, and found them to be "extortionate" and 

without "good faith." Rass argues that such findings compel an 

award of multiple damages. We disagree. 

"Whether the defendants violated c. 93A in a wilful or

knowing manner was a matter for the judge," Kattar v. Demoulas, 

433 Mass. 1, 15 (2000), which we review for an abuse of 

discretion, Clark v. Leisure Woods Estates, Inc., 89 Mass. App.

Ct. 87, 94 (2016). "[B]ecause evidence will support a 

particular finding does not require that the finding be made." 

Kattar v. Demoulas, supra at 16. Here, while an award of 

multiple damages arguably may have been supported by some of the 

findings, the judge was well within the range of her discretion

in declining so to order, particularly in consideration of her 
28

experience with the case in its entirety. See ibid., citing 

Clegg v. Butler, 424 Mass. 413, 420 (1997) (judge's c. 93A 

findings will not be disturbed unless clearly erroneous). 

c. Attorney's fees.

17 On appeal, Rass strongly objects to 

the reduction of its fee submission by half and the denial of 

its motion for supplemental fees. Travelers challenges the fee 

award as well, arguing that Rass should not be awarded fees for 

time spent on work unrelated to the c. 93A claim. 

A trial judge is owed substantial deference in the award 

of reasonable attorney's fees, having witnessed the parties, 

counsel, and case being tried firsthand. See Heller v.

Silverbranch Constr. Corp., 376 Mass. 621, 629 (1978); Fontaine

v. Ebtec Corp., 415 Mass. 309, 324 (1993) (reasonable attorney's 

fee award "is largely discretionary with the judge"); Twin 

Fires, 445 Mass. at 431. Employing the "lodestar" method, Ross

v. Continental Resources, Inc., 73 Mass. App. Ct. 497, 515

(2009), a judge "should consider the nature of the case and the 

issues presented, the time and labor required, the amount of 

damages involved, the result obtained, the experience, 

reputation and ability of the attorney, the usual price charged 

for similar services by other attorneys in the same area, and 

 

17 General Laws c. 93A, § 11, provides that, if a violation 

of c. 93A, § 2, has been established, the plaintiff "shall . . . 

be awarded reasonable attorneys' fees and costs incurred in said 

action." 
29

the amount of awards in similar cases." Linthicum v.

Archambault, 379 Mass. 381, 388-389 (1979) (Linthicum). See T.

Butera Auburn, LLC v. Williams, 83 Mass. App. Ct. 496, 503 

(2013). 

Here, the judge provided several reasons for her 

substantial reduction of the fees requested. She noted that the 

case generally did not raise complex legal issues, but where 

there was complexity she was hindered rather than helped by 

Rass's submissions. Further, Rass made submissions that were 

outside of the procedural rules and frivolous, and which 

continued to press arguments that had already been decided or 

were plainly incorrect. As an example, the judge noted the 

fifty hours billed for Rass's motion for summary judgment, 

despite the "near impossibility of prevailing on such a motion." 

Finally, the judge remarked on the excessive and duplicative 

time Rass's counsel billed for certain pleadings and motions. 

As for the supplemental fee request, the judge denied the motion 

for the reasons cited in Travelers's opposition. 

It is apparent from the record that Rass overwhelmed the 

court with numerous filings of dubious value, and then submitted 

voluminous, detailed billing statements for that work. In her 

application of the Linthicum factors, the judge was well 

warranted in reducing the fees requested by a large percentage 

on that basis. In doing so, she was not required to provide an 
30

hour-by-hour accounting of the result reached. See Twin Fires, 

supra at 429-430 (upholding a forty-five percent reduction of 

fee award where plaintiff had submitted overwhelming and 

unhelpful billing materials, as it was not judge's role "to sort 

out the plaintiffs' perplexing submission. To do so would [be] 

a poor use of judicial resources"), citing Berman v. Linnane, 

434 Mass. 301, 303 (2001) (judge not "required to review and 

allow or disallow each individual item in the bill, but could 

consider the bill as a whole"). It is also apparent that no 

apportionment of the fees was required between the c. 93A and 

breach of contract claims, as they arose from the same primary 

conduct or chain of events. See Castricone v. Mical, 74 Mass.

App. Ct. 591, 604 (2009), and cases cited. On the motion for 

supplemental fees, Travelers's opposition argued that the 

additional fees were for unnecessary work. Upon review, the 

judge's denial on those grounds was not an abuse of her 

substantial discretion.

18

Judgment affirmed.

 

18 Because we affirm the judgment below, we decline to award 

attorney's fees to Rass.