Title: Automile Holdings, LLC v. McGovern
Citation: N/A
Docket Number: SJC-12740
State: Massachusetts
Issuer: Massachusetts Supreme Court
Date: January 14, 2020

NOTICE:  All slip opinions and orders are subject to formal 
revision and are superseded by the advance sheets and bound 
volumes of the Official Reports.  If you find a typographical 
error or other formal error, please notify the Reporter of 
Decisions, Supreme Judicial Court, John Adams Courthouse, 1 
Pemberton Square, Suite 2500, Boston, MA, 02108-1750; (617) 557-
1030; SJCReporter@sjc.state.ma.us 
 
SJC-12740 
 
AUTOMILE HOLDINGS, LLC, & others1  vs.  MATTHEW McGOVERN 
& others.2 
 
 
 
Suffolk.     October 1, 2019. - January 14, 2020. 
 
Present:  Gants, C.J., Lenk, Gaziano, Lowy, Budd, Cypher, 
& Kafker, JJ. 
 
 
Corporation, Close corporation.  Contract, Agreement not to 
compete, Performance and breach.  Damages, Breach of 
contract.  Injunction.  Practice, Civil, Injunctive relief. 
 
 
 
 
Civil action commenced in the Superior Court Department on 
November 21, 2017. 
 
 
The case was heard by Mitchell H. Kaplan, J. 
                     
 
1 AMR Real Estate Holdings, LLC; AMR Real Estate Holdings, 
LLC, Hanover Series; AMR Real Estate Holdings, LLC, Westwood 
Series; AMR Real Estate Holdings, LLC, West Roxbury Series; AMR 
Real Estate Holdings, LLC, West Roxbury II Series; AMR Real 
Estate Holdings, LLC, Walpole Series; AMR Real Estate Holdings, 
LLC North Hampton Series; AMR Real Estate Holdings II, LLC; Saco 
Auto Holdings, LLC; Saco Real Estate Holdings, LLC; Real Estate 
Holdings, LLC, Saco I Series; Saco Real Estate Holdings, LLC, 
Saco II Series; Saco Real Estate Holdings, LLC, Saco III Series; 
Saco Real Estate Holdings, LLC, Saco IV Series; AMR Auto 
Holdings-TY, LLC; AMR Auto Holdings-TH, LLC; AMR Auto Holdings-
TO, LLC; and AMR Auto Holdings-LN, LLC. 
 
 
2 McGovern Auto Group Corp. Services, Inc.; and Timothy 
Fallows. 
2 
 
 
 
 
The Supreme Judicial Court on its own initiative 
transferred the case from the Appeals Court. 
 
 
 
Benjamin M. McGovern (Robert M. Shaw also present) for the 
defendants. 
 
Liam T. O'Connell (Brian K. Lee also present) for the 
plaintiffs. 
 
 
KAFKER, J.  At issue in the instant case is an "anti-
raiding" restrictive covenant entered into between an automotive 
dealership group and a former executive and minority owner.  The 
provision at issue prohibited defendant Matthew McGovern from 
soliciting or hiring employees from his former company for a 
defined period of time.  The restriction was designed to prevent 
McGovern from "raiding" the company by targeting and soliciting 
key employees to work for him.  In spite of this provision, 
McGovern went on to hire numerous employees from his former 
company in breach of the restrictive covenant.  This suit 
quickly followed. 
A judge in the Superior Court concluded that the 
restrictive covenant at issue was enforceable.  He determined 
that, in the case at bar, the anti-raiding purpose of the 
provision constituted a legitimate business interest.  The judge 
further concluded that McGovern had committed a breach of the 
covenant by hiring at least three employees from his former 
company.  Further, the judge found that McGovern had 
3 
 
 
misrepresented the nature of a transaction to the court in order 
to obfuscate his violation of the restrictive covenant.  The 
judge declined to enjoin the three employees McGovern had hired 
from continuing to work for him.  Instead, the judge issued 
injunctive relief extending the length of the restrictive 
covenant for one additional year beyond the end date provided 
for in the contract.  On appeal, the parties contest whether 
such a provision is necessary to protect a legitimate business 
interest.  They also disagree as to whether the judge may use 
the court's equitable powers to extend the length of the 
restrictive covenant beyond the terms of the contract. 
We conclude that, in the factual circumstances of this 
case, the restrictive covenant was necessary to protect a 
legitimate business interest.  In reaching that conclusion, we 
observe that the restrictive covenant at issue is more properly 
considered as arising from the sale of a business rather than 
from an employment agreement, and thus is to be more liberally 
construed. 
It is clear from the record below, and at this point 
appears undisputed, that the defendant committed a breach of the 
anti-raiding provision.  However, the equitable remedy fashioned 
by the trial judge, which expanded the restrictive covenant 
beyond its plain terms, constituted an abuse of discretion 
where, as here, the plaintiffs had not yet attempted to 
4 
 
 
calculate monetary damages.  As a matter of public policy, we 
strongly disfavor restrictive covenants, and the use of an 
equitable remedy to extend such a restriction beyond the plain 
terms of the contract, even in the context of a sale of a 
business, was not warranted without a finding that damages would 
be inadequate. 
 
1.  Facts.  We summarize the facts as found by the trial 
judge,3 supplemented by uncontested facts from the record.  See 
Connor v. Benedict, 481 Mass. 567, 568 (2019). 
 
a.  Background.  In November 2007, David Rosenberg founded 
Prime Motor Group (Prime)4 with McGovern and David Abrams.  The 
company was a closely held corporation created to manage a 
number of retail automobile dealerships in New England.  Abrams 
was a friend of Rosenberg, and his company, Abrams Capital, 
became the majority shareholder in Prime.  Rosenberg, 
Rosenberg's father, and McGovern became minority shareholders.  
McGovern was initially employed as Prime's chief financial 
officer.  He later became the vice-president of operations.  
                     
 
3 The parties waived detailed findings of fact and 
conclusions of law.  The judge nevertheless provided some oral 
findings in open court upon issuing his decision. 
 
 
4 The plaintiffs in this case consist of a group of limited 
liability companies that are affiliated with, and collectively 
operate as, Prime Motor Group.  For simplicity, we will refer to 
these entities as "Prime dealerships" or simply "Prime," except 
where specifically noted. 
5 
 
 
Rosenberg worked as the company's chief executive officer and 
president. 
 
In 2015, disagreements arose among Rosenberg, Abrams, and 
McGovern in relation to a decision to sell the company.  In 
February 2016, these disagreements led Abrams and Rosenberg to 
terminate McGovern's employment.  At the time of his 
termination, McGovern was not subject to a noncompete agreement.  
McGovern also did not have a right to redeem his minority 
interest in Prime upon termination.  As this was a closely held 
corporation, however, he was owed fiduciary duties.  See Wilkes 
v. Springside Nursing Home, Inc., 370 Mass. 842, 850 (1976). 
 
b.  Sale of McGovern's interest in Prime.  At the time of 
McGovern's termination, Rosenberg offered to purchase McGovern's 
minority interest.  Because Prime was a closely held 
corporation, McGovern's minority interest was illiquid.  Thus, 
Rosenberg only offered to purchase McGovern's interest subject 
to a thirty percent discount on its fair market value.  
Rosenberg also wanted McGovern to agree to a five-year 
nonsolicitation provision.  McGovern rejected the offer. 
 
Abrams and Rosenberg subsequently took steps to pressure 
McGovern to sell his interest in Prime prior to an expected 
liquidity event.  First, they amended Prime's operating 
agreement to remove a provision that allowed for the 
distribution of profits sufficient to cover the owners' tax 
6 
 
 
liabilities.  Such provisions are commonplace, and without it, 
McGovern faced a tax liability of between $500,000 and $600,000 
for the 2015 tax year.  Additionally, Abrams and Rosenberg 
denied McGovern access to Prime's financial information, leaving 
McGovern unable to calculate his expected tax obligation for the 
2016 tax year.  Abrams and Rosenberg also demanded that McGovern 
and his wife return the company vehicles they had been using and 
threatened to report McGovern to the authorities as being in 
possession of stolen automobiles.  As the trial judge remarked, 
these tactics amounted to Rosenberg and Abrams applying "as much 
pressure as they could manage to put on [McGovern] to take the 
best deal they could get" in purchasing McGovern's minority 
stake before the company's anticipated liquidity event. 
 
At the same time that Abrams and Rosenberg were pressuring 
McGovern to sell his interest in Prime, McGovern was in the 
process of starting his own competing automotive group, McGovern 
Motors.  McGovern was thus short on cash both to cover his tax 
liability and to fund his new business.  Due to this financial 
pressure, McGovern entered into negotiations with Abrams and 
Rosenberg to sell his interest in Prime.  McGovern was 
represented by counsel in these negotiations, as was Prime. 
 
McGovern, Abrams, and Rosenberg eventually reached an 
agreement to repurchase McGovern's interest in the company in 
October 2016 (2016 repurchase agreement).  Pursuant to the 
7 
 
 
agreement, Prime's other owners would buy out McGovern's 
minority share based on a June 2016 valuation.  According to 
Rosenberg's testimony at trial, Rosenberg and Abrams agreed not 
to discount the value of McGovern's ownership interest, despite 
the fact that Prime was a closely held corporation.  McGovern 
was instead given the full value of his minority interest, as 
calculated by the June 2016 valuation.  In exchange for 
receiving the full value of his interest, McGovern agreed to an 
eighteen-month restrictive covenant.  Specifically, McGovern 
agreed not to directly or indirectly "hire or solicit any 
employee or consultant of [Prime] or encourage any such employee 
or consultant to leave such employment or hire any such employee 
or consultant who has left such employment, except pursuant to a 
general solicitation which is not directed specifically to any 
such employees."5  This restrictive covenant was set to expire in 
April 2018. 
 
c.  Post-2016 repurchase agreement hiring activities and 
signing of 2017 agreement.  After leaving Prime, McGovern worked 
to develop McGovern Motors, which came to comprise six 
                     
 
5 The restrictive covenant contained within the 2016 
repurchase agreement also provided that McGovern could not 
directly or indirectly "cause, induce or encourage any supplier 
or licensor of any Company to reduce, change or terminate their 
relationship with any Company."  As defined in the agreement, 
"Company" referred to the limited liability companies that 
collectively operate as Prime Motor Group. 
8 
 
 
dealerships.  Despite agreeing to the restrictive covenant 
contained within the 2016 repurchase agreement, McGovern went on 
to hire at least fifteen former Prime employees to work at 
McGovern Motors.  Upon learning that McGovern had hired former 
Prime employees, Rosenberg threatened to sue.  McGovern denied 
engaging in any specific solicitation of Prime employees, 
insisting that his hiring practices fell within the general 
solicitation exception to the 2016 restrictive covenant.  The 
parties eventually agreed to enter into a new agreement in 
February 2017 (2017 agreement), which, according to its terms, 
was entered into "[i]n order to avoid the cost of litigation 
relating to this dispute."6 
 
Pursuant to the 2017 agreement, Rosenberg and Abrams agreed 
not to pursue legal action against McGovern for violating the 
2016 repurchase agreement's restrictive covenant, provided that 
he abide by the terms of the 2017 agreement.  In exchange, 
McGovern agreed to enter into a more robust restrictive covenant 
that would be extended in duration for four additional months, 
ending in August 2018. 
 
Pursuant to the 2017 agreement's restrictive covenant, 
McGovern agreed, inter alia, not to "directly or indirectly 
                     
 
6 The trial judge explicitly stated that he was "unable to 
determine whether [McGovern hired former Prime employees] in 
violation of the [2016 repurchase agreement]." 
9 
 
 
. . . solicit for hire or hire" Prime employees, "or encourage 
[Prime employees] to leave the employment" of Prime through 
August 8, 2018.7  Notably, it did not include an exception for 
general solicitation, as the 2016 repurchase agreement had.  
With regard to available remedies, the 2017 agreement provided 
that 
"in the event McGovern or McGovern Motors breaches [the 
2017 agreement], Prime shall be entitled to all damages and 
remedies available under applicable law, and further, 
McGovern and McGovern Motors consent to the entry of 
preliminary or permanent injunctive relief as a remedy for 
a violation of this Agreement, without the need to prove 
irreparable harm or to post a bond." 
 
The 2017 agreement also stated that, subject to the amendment to 
the 2016 repurchase agreement's restrictive covenant, "all other 
provisions of the [2016 repurchase agreement] shall remain in 
full force and effect."  Despite the terms of the 2017 
agreement, McGovern again went on to solicit and hire additional 
Prime employees. 
 
d.  Breaches of 2017 agreement.  After signing the 2017 
agreement, McGovern hired Courtney Price and Greg Howle, both 
former Prime employees.  Prime soon learned that McGovern had 
                     
 
7 The 2017 agreement's restrictive covenant extended not 
only to Prime employees, but also to consultants.  Pursuant to 
the covenant, McGovern could not "retain as a consultant or 
contractor, or otherwise accept the services, either directly or 
indirectly, of any individual who is or was . . . an employee or 
consultant of Prime" during the relevant period. 
10 
 
 
hired Price, and demanded that McGovern fire her.  McGovern 
complied, terminating Price's employment in or around August 
2017.8  In the fall of 2017, Prime learned that Howle, who had 
previously been terminated from Prime, had also been hired by 
McGovern.  Prime immediately filed suit and sought a preliminary 
injunction to enjoin McGovern from continuing to employ Howle 
and to extend the 2017 restrictive covenant for an additional 
eighteen months.  A judge in the Superior Court concluded that 
because Prime had fired Howle, it did not have a legitimate 
business interest in preventing Howle from working for McGovern, 
and declined to grant injunctive relief.  The judge stated that 
although Prime had a legitimate interest in not having "a long-
time senior executive who's just left solicit [Prime's] very 
employees," that interest did not apply to a former employee 
that Prime itself had chosen to fire.  The judge did, however, 
conclude that the restrictive covenant would become enforceable 
when "used to prohibit raiding of current employees or employees 
who become non-current because they're resigning to go work for 
. . . McGovern, and an injunction would enter to prevent that."  
Despite this, Prime later learned that McGovern had hired three 
                     
 
8 After a judge in the Superior Court ruled that Prime did 
not have a legitimate business interest in protecting Price, 
McGovern rehired her. 
11 
 
 
other Prime employees who are the subject of the instant 
litigation:  Timothy Fallows, James Tully, and Zachary Casey. 
 
i.  Timothy Fallows.  Fallows was hired by Prime in 
February 2013.  He worked as a sales manager at Prime 
dealerships on Cape Cod and in Hanover.  As part of his 
employment with Prime, Fallows signed a confidentiality and 
nonsolicitation agreement.  In the spring of 2017, Fallows left 
the company.  The judge found that the circumstances surrounding 
his departure from Prime "[were not] entirely clear."  
Immediately following his departure from Prime, Fallows went to 
work at a Chevrolet dealership.  After six weeks, he quit his 
job there and began working at a Volkswagen dealership.  Fallows 
subsequently lost his job at the Volkswagen dealership and was 
hired by McGovern in November 2017. 
 
ii.  James Tully.  Tully was hired by Prime in April 2013.  
He initially worked as a sales consultant, but was later 
promoted to commercial vehicle manager.  Tully was apparently 
not considered a valued employee by the company.  Prime was 
uninterested in a line of business that Tully sought to pursue, 
and when Tully resigned in April 2017, Rosenberg viewed the 
resignation positively.  In an e-mail message to another Prime 
employee, Rosenberg stated that Tully's resignation was "a good 
thing," as Tully was "[w]ay overpaid, and thinks he deserves 
more."  Subsequent to his resignation from Prime, Tully was 
12 
 
 
hired by McGovern to deal with physical plant issues at McGovern 
Motors.  At no point during his prior employment with Prime had 
Tully been given responsibilities relating to Prime's facilities 
maintenance. 
 
iii.  Zachary Casey.  Casey began working for Prime in the 
fall of 2007, when Prime bought out another automotive group for 
which Casey had been working.  Casey had initially worked as a 
sales manager, but he rose rapidly through the ranks at Prime.  
Prime eventually paid to send Casey to a year-long program in 
Virginia in which participants are trained to become general 
managers of automotive dealerships.  Shortly thereafter, in the 
summer of 2016 Casey was promoted to general manager of three 
Prime dealerships in Maine. 
 
In the fall of 2017, Casey met with McGovern to discuss 
potentially joining McGovern Motors and buying equity in the 
company.  Pursuant to these discussions, Casey subsequently 
resigned from his position with Prime in December 2017.  He was 
not subject to a noncompetition agreement at the time of his 
departure from Prime.9 
                     
 
9 Casey testified that by December 2017, he was aware of the 
ongoing legal dispute between McGovern and Prime, and that it 
involved a restrictive covenant governing McGovern's ability to 
hire former Prime employees. 
 
13 
 
 
 
In January 2018, Casey agreed to buy McGovern's interest10 
in Toyota of Nashua, an automotive dealership in Nashua, New 
Hampshire, that formed part of McGovern Motors.  Casey was not 
represented by counsel during this transaction, and McGovern set 
the purchase price.  In order for Casey to place a down payment 
on the purchase price, McGovern sent a check to Casey's father, 
who wired a near equivalent amount of money to Casey.  Casey 
then remitted that money to McGovern as a down payment.  
McGovern did not obtain approval from Toyota prior to initiating 
the sale to Casey. 
 
e.  Initial procedural history and representations to the 
court.  Upon learning that Casey had purportedly taken a job 
with McGovern, Prime again sought a preliminary injunction in 
January 2018, asserting that McGovern had violated the 2017 
agreement.  In response, McGovern represented that he had not 
hired Casey as an employee.  In a sworn affidavit, McGovern 
stated that Casey had not been hired as a general manager for 
McGovern but, rather, had purchased McGovern's interest in the 
dealership.  McGovern did not reveal to the court that he had 
lent the money for the down payment to Casey, that Toyota had 
                     
10 Specifically, Casey agreed to buy McGovern's entire 
interest in the holding company that owned a majority interest 
in the Toyota dealership. 
14 
 
 
not yet approved the sale, or that Toyota's approval was 
necessary before the sale could be effectuated. 
Upon learning of the transaction between Casey and 
McGovern, Rosenberg sent the purchase agreement to a market 
representation manager for Toyota, stating that he believed it 
to be a sham transaction.  When Toyota learned of the 
transaction and threatened to terminate its relationship with 
the dealership, Casey and McGovern rescinded the sale and 
McGovern returned the down payment to Casey.11  Despite the 
rescission, from January 2018 onward, Casey has assumed the role 
of general manager at the Toyota of Nashua dealership. 
 
f.  Subsequent procedural history.  After conducting 
expedited discovery on McGovern's purported sale to Casey, Prime 
renewed its motion for a preliminary injunction and amended its 
complaint.12  This third request by Prime for a preliminary 
                     
 
11 The trial judge did not make a finding whether the Toyota 
dealership sale was actually a sham transaction.  While the 
judge made it clear that McGovern was using the sale to side-
step the terms of the 2017 agreement, the judge nevertheless 
expressed uncertainty whether the transaction would have fallen 
apart if Rosenberg had not informed Toyota of the purchase.  He 
appeared to credit Casey's testimony that Casey was genuinely 
looking to buy equity in a dealership when he chose to enter 
into the transaction with McGovern. 
 
 
12 Prime's operative second amended complaint, filed on 
March 16, 2018, includes claims of breach of contract, breach of 
the implied covenant of good faith and fair dealing, tortious 
interference with contractual or advantageous business 
relations, and misappropriation of trade secrets. 
15 
 
 
injunction sought to enjoin McGovern from continuing to employ 
Casey, Fallows, and Tully and requested an eighteen-month 
extension of the restrictive covenant.  The operative complaint 
sought damages, an eighteen-month extension of the restrictive 
covenant period, declaratory judgment as to McGovern's 
violations of the 2017 agreement, attorney's fees, and 
additional injunctive relief. 
 
On April 25, 2018, the judge granted preliminary injunctive 
relief as to the enforcement of the 2017 agreement going 
forward, enjoining McGovern from soliciting or hiring former 
Prime employees "until further order of the court."  The judge 
declined at that time to issue a preliminary injunction as to 
McGovern's employment of Casey, Fallows, and Tully, or to extend 
the length of the 2017 restrictive covenant, concluding that 
further factual development was necessary.  The judge instead 
advanced and consolidated those preliminary injunctive requests 
with the merits of the plaintiffs' equitable claims, pursuant to 
Mass. R. Civ. P. 65, 365 Mass. 832 (1974),13 and scheduled a 
                     
 
13 Rule 65 provides, in relevant part: 
 
"Before or after the commencement of the hearing of an 
application for a preliminary injunction, the court may 
order the trial of the action on the merits to be advanced 
and consolidated with the hearing of the application.  This 
subdivision (b)(2) shall be so construed and applied as to 
save to the parties any rights they may have to trial by 
jury." 
16 
 
 
jury-waived trial for June 2018, two months before the 
restrictive covenant was set to expire. 
 
After a five-day trial commencing on June 20, 2018, the 
judge found that McGovern had entered into a binding contract 
with Prime upon signing the 2017 agreement.  The judge indicated 
that the restrictive covenant contained within the 2017 
agreement was best characterized as an anti-raiding provision, 
which was "intended to protect the buyer of a business or an 
interest in a business . . . from losing key employees."  The 
judge concluded that this was a protectable business interest, 
but that, unlike the protection of trade secrets, confidential 
information, or good will, it was difficult to determine "what 
kind of injunctive relief could be entered to protect this 
particular business interest after there's been a breach of 
contract, that is[,] after the soliciting or the hiring has 
occurred." 
 
The judge found that McGovern had committed a breach the 
anti-raiding provision by hiring Fallows and Tully.  The judge 
also found that McGovern had violated the 2017 agreement by 
encouraging Casey to leave Prime and later employing Casey as 
the general manager of Toyota of Nashua.  The judge did not, 
however, enter equitable relief against McGovern Motors with 
                     
 
Mass. R. Civ. P. 65 (b) (2), 365 Mass. 832 (1974). 
17 
 
 
respect to Fallows, Tully, or Casey.  The judge concluded that 
Fallows was not a particularly valued employee at Prime, and 
that Prime had "no significant or valid business interest . . . 
that would be advanced by entering any injunctive relief with 
respect to [him]."  Similarly, the judge concluded that Prime 
did not consider Tully to be a valued employee and that "no 
legitimate business purpose would be advanced by entering any 
injunctive relief with respect to [him]."  With respect to 
Casey, however, the judge concluded that he was "just the kind 
of employee that the anti-raiding provisions that had been 
negotiated in the contract [were] designed to protect from 
solicitation by . . . McGovern," as Prime had "spent a 
considerable sum sending him to school so that he could learn 
how to be a general manager of an automobile dealership." 
 
While recognizing the substantial investment that Prime had 
made in Casey, the judge also recognized that, by the time of 
trial, Casey had "already moved [from Maine] to New Hampshire, 
sold his house, [and] presumably [had] entered his kids in 
school in New Hampshire."  The judge thus concluded that there 
was "no way that the Court can order . . . Casey's relationship 
with Prime to be repaired."  Accordingly, the judge determined 
that enjoining Casey from continuing to work for McGovern Motors 
would effectively serve as punishment to Casey, despite the fact 
that he was not a defendant to the suit, and would provide no 
18 
 
 
benefit to Prime.  The judge thus declined to enter injunctive 
relief with respect to Casey.  He did conclude, however, "that 
if Prime is able to establish that it suffered any damages as a 
result of the breach of contract as it relates to . . . Casey, 
then it would be entitled to monetary relief." 
 
Rather than decline to enter any equitable relief, the 
judge extended the length of the restrictive covenant in the 
2017 agreement by one year, i.e., to August 8, 2019.  The judge 
conceded that the law was "less than clear" as to his ability to 
extend the time period of a restrictive covenant beyond its 
expiration date in the contract, but he did so, relying on the 
general proposition that trial judges have broad discretion to 
grant or deny injunctive relief.  Because the trial was limited 
to the plaintiffs' equitable claims, the judge did not make any 
findings as to damages, which have yet to be litigated.  In a 
posttrial bench memorandum, the plaintiffs indicated that they 
valued the restrictive covenant in the 2016 repurchase agreement 
at $2 million. 
 
The judge entered his order as a final judgment pursuant to 
Mass. R. Civ. P. 54 (b), 365 Mass. 820 (1974),14 so as to allow 
                     
 
14 Rule 54 (b) provides in relevant part: 
 
"When more than one claim for relief is presented in an 
action . . . , the court may direct the entry of a final 
judgment as to one or more but fewer than all of the claims 
19 
 
 
the parties to appeal from the judgment immediately.  McGovern 
appealed, and we transferred the appeal to this court on our own 
motion. 
 
On appeal, McGovern argues that the 2017 agreement's 
restrictive covenant does not serve a legitimate business 
interest, and that either the judge lacked the authority to 
extend the duration of the restrictive covenant or such an 
extension was improper without a showing as to the inadequacy of 
damages.15 
 
During oral argument before this court on October 1, 2019, 
and in a postargument letter submitted to the court, Prime 
argued that because the extension period had since expired, this 
appeal should be considered moot.  However, the issue whether 
                     
. . . only upon an express determination that there is no 
just reason for delay and upon an express direction for the 
entry of judgment." 
 
Mass. R. Civ. P. 54 (b), 365 Mass. 820 (1974). 
 
 
15 We note that, subsequent to the events at issue in this 
litigation, the Legislature passed the Massachusetts 
Noncompetition Agreement Act, which sets out requirements for an 
employee noncompetition agreement to be valid and enforceable.  
See St. 2018, c. 228, § 21.  The legislation only applies to 
employee noncompetition agreements entered into on or after 
October 1, 2018.  See St. 2018, c. 228, § 71.  By its terms, the 
legislation does not apply to nonsolicitation agreements or 
agreements made in connection with the sale of a business.  See 
G. L. c. 149, § 24L (explicitly exempting "covenants not to 
solicit or hire employees of the employer" and agreements 
"disposing of the ownership interest of a business entity" from 
the definition of "noncompetition agreement"). 
20 
 
 
and when a trial judge may exercise equitable authority to 
extend a restrictive covenant beyond its plain terms is one that 
we have not explicitly addressed, and has been the subject of 
conflicting decisions in the United States Court of Appeals for 
the First Circuit and the Superior Court.  Similarly, the 
permissibility of anti-raiding provisions has not yet been 
addressed by this court.  Accordingly, "[w]e exercise our 
discretion to reach the merits of [this] appeal regardless [of] 
whether the matter may currently be moot, because the issues are 
significant and have been fully briefed and it is in the public 
interest to do so."  Doe v. Police Comm'r of Boston, 460 Mass. 
342, 343 n.3 (2011). 
 
2.  Discussion.  As an initial matter, we consider whether 
the anti-raiding provision in the 2017 agreement is an 
enforceable restrictive covenant necessary to protect a 
legitimate business interest.  We conclude that it is. 
 
a.  Standard of analysis for restrictive covenants.  We 
have long recognized a public interest in the ability of 
individuals to be able to carry on their trade freely.  Club 
Aluminum Co. v. Young, 263 Mass. 223, 226 (1928).  See Kroeger 
v. Stop & Shop Cos., 13 Mass. App. Ct. 310, 312 (1982) 
("Reluctance to give full effect to post-employment restraints 
has a long history in the law").  Out of this concern for an 
individual's ability to earn a living, covenants restraining 
21 
 
 
competition are only enforceable to the extent that they are 
reasonable.  See Whitinsville Plaza, Inc. v. Kotseas, 378 Mass. 
85, 102 (1979); All Stainless, Inc. v. Colby, 364 Mass. 773, 778 
(1974); Kroeger, supra.  See also Oxford Global Resources, LLC 
v. Hernandez, 480 Mass. 462, 471 (2018) (observing that "same 
principles" apply to both noncompetition and nonsolicitation 
provisions); Restatement (Second) of Contracts § 186 (1981).  
Such a restrictive covenant is only reasonable, and thus 
enforceable, if it is (1) necessary to protect a legitimate 
business interest, (2) reasonably limited in time and space, and 
(3) consonant with the public interest.  Boulanger v. Dunkin' 
Donuts Inc., 442 Mass. 635, 639 (2004), cert. denied, 544 U.S. 
922 (2005).  If the covenant is found to be too broad "in time, 
in space or in any other respect," the court will only enforce 
the agreement "to the extent that is reasonable and to the 
extent that it is severable for the purposes of enforcement."  
All Stainless, Inc., supra. 
Because we assess the reasonableness of covenants 
restraining competition "in light of the facts in each case," 
the context in which the covenant arises affects our analysis.  
Boulanger, 442 Mass. at 639.  Such covenants typically arise in 
the context of an employment agreement or a sale of a business.  
Id.  Whether a restrictive covenant arises in one context or the 
other has been considered relevant to the parties' relative 
22 
 
 
bargaining power, the hardship to the promisor of abiding by the 
terms of the restrictive covenant, and thus the over-all 
reasonableness of the restriction. 
Restrictive covenants arising in the context of an 
employment agreement traditionally restrain the ability of an 
employee to compete with his or her employer for a certain 
period of time posttermination in a specific geographic area.  
See, e.g., All Stainless, Inc., 364 Mass. at 774-775 (involving 
restrictive covenant prohibiting employee from competing with 
employer in New England or New York for two-year period 
posttermination).  Such postemployment restraints are often the 
product of unequal bargaining power.  Restatement (Second) of 
Contracts § 188 (1981).  Employees are "likely to give scant 
attention to the hardship [they] may later suffer through loss 
of [their] livelihood."  Id.  They often also agree to such 
restraints without the assistance of counsel.  See Wells v. 
Wells, 9 Mass. App. Ct. 321, 323–328 (1980). 
By contrast, "[c]oncern about the restricted individual and 
the probability of unequal bargaining power between an employer 
and an employee recedes when the restriction arises in the 
context of the sale of a business or . . . the sale of an 
interest in a business."  Id. at 324.  Buyers and sellers are 
more likely to have equal bargaining power and legal 
representation, the seller is likely to be able to rely on the 
23 
 
 
proceeds of the sale to temporarily refrain from competition 
with the buyer, and the seller is typically paid a premium for 
agreeing not to compete with the buyer.  See Alexander & 
Alexander, Inc. v. Danahy, 21 Mass. App. Ct. 488, 496 (1986).  
Moreover, where the sale includes good will, "a broad 
noncompetition agreement may be necessary to assure that the 
buyer receives that which he [or she] purchased."  Id.  In light 
of these significant differences, restrictive covenants entered 
into as part of a sale of a business are examined less 
critically than those entered into as part of an employment 
agreement.  Boulanger, 442 Mass. at 639. 
Whether a restrictive covenant arises in the context of an 
employment agreement or a sale of a business is particularly 
relevant where, as here, the parties dispute whether the 
restriction is necessary to protect a legitimate business 
interest.16  In the employer-employee context, the legitimate 
business interests that may be protected consist of trade 
secrets, confidential information, and good will.  New England 
Canteen Serv., Inc. v. Ashley, 372 Mass. 671, 674 (1977).  By 
contrast, "in the buyer-seller context, restrictions 'are not 
rendered unenforceable merely because they protect an interest 
                     
16 On appeal, McGovern does not argue that the 2017 
agreement's restrictive covenant, as written, was unreasonable 
in scope or that it was injurious to the public interest. 
24 
 
 
we might not recognize in any employment setting.'"  Wells, 9 
Mass. App. Ct. at 325, quoting Whitinsville Plaza, Inc., 378 
Mass. at 102.  Rather, "[u]nreasonableness in time, space, or 
product line, or obstruction of the public interest, are the 
principal bars to enforcement."  Wells, supra, quoting 
Whitinsville Plaza, Inc., supra at 102-103.  Where a covenant is 
connected both to the sale of a business and to an employment 
relationship, "[i]t is [thus] important to identify at the 
outset to which aspect of the arrangement" the restrictive 
covenant "primarily relate[s]."  Alexander & Alexander, Inc., 21 
Mass. App. Ct. at 496.  See Boulanger, 442 Mass. at 640 
(examining whether covenant contained within franchise agreement 
more closely resembles employment covenant or sale of business 
covenant).  With these principles in mind, we examine how to 
classify the restrictive covenant contained within the 2017 
agreement. 
b.  Classification of 2017 agreement.  The issue whether 
the 2017 restrictive covenant may be characterized as arising 
within the employer-employee or sale of a business context is 
not completely straightforward.  It has elements of both.  See 
Alexander & Alexander, Inc., 21 Mass. App. Ct. at 495-496.  
McGovern was a high-level executive but also a founder and 
minority shareholder in the company with whom he signed the 
agreement.  His employment had been terminated before either the 
25 
 
 
2016 or 2017 agreement.  Those agreements were also directed at 
buying out his interest in the company, not defining the terms 
and conditions or termination of his employment.  That being 
said, the sale of McGovern's business interest did not resemble 
a prototypical arm's-length transaction with a third-party 
purchaser.  Rather, Rosenberg and Abrams pressured McGovern to 
sell his interest to them, despite the fact that Abrams's 
company was the majority shareholder in a closely held 
corporation and owed a fiduciary duty of utmost good faith and 
loyalty in its dealings with minority shareholders.  See Wilkes, 
370 Mass. at 850. 
Further, the restrictive covenant at issue was not 
unrelated to McGovern's prior employment in the company.  
According to Rosenberg, the 2016 restrictive covenant was 
formulated in response to McGovern's role, or at least the 
knowledge he had acquired, as vice-president of operations, an 
employment position within the company, rather than his position 
as minority owner of the company.  At the same time, the 
restrictive covenant in the 2016 repurchase agreement was an 
integral part of the sale of McGovern's minority interest, and 
the 2017 agreement served as a settlement agreement of the 
dispute arising out of that agreement.  See Alexander & 
Alexander, Inc., 21 Mass. App. Ct. at 497 (where restrictive 
covenants were treated as "integral part" of agreement for sale 
26 
 
 
of business, "there is no reason for us to view them as 
something other than what they purport to be"). 
Upon examination of the context and characteristics of the 
2017 anti-raiding provision, we conclude that the restrictive 
covenant is more appropriately deemed to arise within the sale 
of a business rather than the employment context.  When McGovern 
entered into negotiations that led to the 2016 repurchase 
agreement, he was no longer a Prime employee and remained free 
to compete with that business.  By the time he negotiated the 
2017 agreement, McGovern's employment was long past.  The 2016 
and 2017 agreements were therefore much more closely associated 
with the sale of McGovern's business interest than his prior 
employment, particularly the 2017 agreement.  Further, McGovern 
was aided by counsel throughout the negotiation process and, as 
the trial judge found, he was no longer in an unequal bargaining 
position typical of the employer-employee context by the time he 
entered into the 2017 agreement.17  See Wells, 9 Mass. App. Ct. 
                     
17 We also note that McGovern had significantly more 
bargaining power than a standard employee.  He was a cofounder 
and former minority owner who had also worked as an executive 
for the very company against which he was negotiating.  See 
Kroeger v. Stop & Shop Cos., 13 Mass. App. Ct. 310, 319 (1982) 
(key employee's elevated bargaining status "enlarge[s] judicial 
tolerance of restraints by an employer which might be seen as 
unreasonable between parties of unequal bargaining strength").  
Additionally, McGovern was also in the process of developing his 
own automotive group, demonstrating that he had a sophisticated 
understanding of the intricacies of the corporate form. 
27 
 
 
at 323–328 (compulsion typically present in employment context).  
Although it does not fit neatly into either category, we 
conclude that the 2017 anti-raiding restriction should be 
analyzed as arising within the context of a sale of business 
interest, not an employment agreement.  See Boulanger, 442 Mass. 
at 640. 
In determining that the 2017 anti-raiding covenant is more 
properly considered as arising from the sale of a business 
interest rather than a restrictive covenant in employment, we do 
recognize that the 2017 covenant placed some limitation on the 
employment rights of Prime employees who were not parties to the 
agreement.  They could not be raided, and therefore employed, by 
McGovern.  That restriction on employment does not, however, 
present the same concerns as traditional noncompetition 
agreements in the employment context.  Rather than directly 
prohibiting an employee from going to work for any competitor 
within a certain geographic region, the restrictive covenant 
contained within the 2017 agreement only indirectly prohibited 
employment with a single competitor.  Contrast Marine Contrs. 
Co. v. Hurley, 365 Mass. 280, 283 (1974) (restrictive covenant 
prohibiting employee from competing with employer, directly or 
indirectly, within one hundred mile radius of Boston for five 
years); All Stainless, Inc., 364 Mass. at 774-775 (prohibiting 
employee from competing in New England or New York for two-year 
28 
 
 
period posttermination).  Nor has evidence been presented to 
indicate that McGovern Motors is the only, or even the primary, 
competitor to Prime in the region.  Thus, the 2017 restrictive 
covenant does not implicate concerns about "an individual's 
ability to earn a living and to protect against monopoly" to the 
same extent as a traditional employee noncompetition agreement.  
See Wells, 9 Mass. App. Ct. at 323. 
To summarize, in light of McGovern's bargaining power and 
legal representation, as well as the covenant's direct 
connection to McGovern's sale of his minority interest and only 
indirect connection to his prior employment, we conclude that 
the restrictive covenant contained within the 2017 agreement is 
more akin to the sale of a business interest than to an 
employment relationship.  Having concluded that the 2017 
restrictive covenant arose in a context akin to the sale of a 
business, we next turn to whether the anti-raiding purpose of 
the covenant constitutes a legitimate business interest in this 
context. 
c.  Anti-raiding interest.  We note at the outset that 
protection from "ordinary competition" is not a legitimate 
business interest in any context, and a restrictive covenant 
"designed solely for that purpose will not be enforced."  See 
Marine Contrs. Co., 365 Mass. at 287-288.  While trade secrets, 
confidential information, and conventional good will do 
29 
 
 
constitute legitimate business interests in the employment 
context, the trial judge found that the anti-raiding provision 
at issue did not pertain to those interests.  However, 
"[r]easonable business interest[s] in the buyer-seller setting" 
extend beyond conventional notions of client good will to 
encompass more expansive interests.  Wells, 9 Mass. App. Ct. at 
323–328. 
The anti-raiding interest at issue here was a specific one.  
Prime did not simply seek to restrict former employees from 
competing.  To the contrary, Prime did not typically ask its 
employees to sign noncompetition agreements.  Prime employees 
were, as a general matter, thus free to compete with the company 
upon their departure.  Rather, the interest at issue here 
pertained specifically to preventing McGovern from raiding Prime 
of its key employees after his termination.  In the 
circumstances of the instant case, we conclude that Prime's 
anti-raiding interest was a legitimate one. 
Far from stifling ordinary competition, the restrictive 
covenant permitted McGovern to compete so long as he did not use 
his inside knowledge to raid Prime's key employees.  As an 
executive and part owner, McGovern was familiar with Prime's 
employee workforce and was well placed to identify key employees 
integral to the company's success.  For those employees he 
wished to poach, he could use his inside knowledge of the 
30 
 
 
company, including its salary structure and internal management 
dynamics, to successfully solicit them.  For example, the record 
reflects that McGovern was aware of, and perhaps dictated, 
Fallows's starting salary at Prime.  Armed with information 
about Prime employees' existing compensation plans, McGovern 
could tailor any solicitation offer to provide more competitive 
benefits than Prime.  He was also aware of the particular 
strengths, experience, and training of different Prime 
employees.  The 2016 restrictive covenant was thus formulated to 
ensure that McGovern's competing business did not gain an unfair 
advantage by using this inside information, in combination with 
McGovern's position as a competitor, to raid Prime.  
Importantly, as mentioned supra, regular Prime employees were 
not generally subject to noncompetition agreements, and the 2016 
restrictive covenant only prevented Prime employees from working 
for McGovern, who was one competitor among several in the 
region.  In the context of the 2017 agreement, which itself 
sought to settle claims pertaining to purported solicitation in 
violation of the 2016 repurchase agreement, Prime's interest in 
preventing McGovern from raiding the company of key employees 
was a legitimate one. 
Additionally, McGovern was able to sell his minority 
interest at a premium because he agreed to the restrictive 
covenant contained within the 2016 repurchase agreement.  The 
31 
 
 
purchase price of McGovern's minority interest was determined 
based on a June 2016 third-party valuation of Prime, which had 
estimated the fair market value of the entire automotive 
dealership group.  As Rosenberg testified, McGovern's minority 
interest in Prime, a closely held corporation, was illiquid and 
would typically be purchased at a discounted value.  Rosenberg's 
uncontested testimony indicates that Rosenberg and Abrams 
nonetheless agreed to pay McGovern the full value of his 
minority interest, based on the June 2016 valuation, in exchange 
for McGovern's willingness to agree to the restrictive covenant 
contained within the 2016 repurchase agreement.  As Rosenberg 
testified, "if Abrams and I were going to pay . . . McGovern a 
significant sum of money . . . for his membership interest, then 
we did not want him to raid our company."  The 2017 agreement, 
which was aimed at shoring up the protections of the restrictive 
covenant contained within the 2016 repurchase agreement, thus 
served the legitimate business interest of ensuring that 
McGovern did not "derogate from the value of the business" 
interest he sold to the other owners of Prime in 2016.  
Boulanger, 442 Mass. at 645–646.  See Wells, 9 Mass. App. Ct. at 
324 (same).  Cf. Alexander & Alexander, Inc., 21 Mass. App. Ct. 
at 496 ("Where the sale of the business includes good will, as 
this sale did, a broad noncompetition agreement may be necessary 
to assure that the buyer receives that which he purchased").  
32 
 
 
Thus, in light of McGovern's prior position within Prime, his 
present position as a competitor well poised to steal Prime 
employees, and the additional consideration he received in 
exchange for agreeing to the restrictive covenant, Prime had a 
legitimate anti-raiding business interest. 
 
The reasonableness of Prime's anti-raiding interest is 
exemplified by McGovern's solicitation of Casey.  After 
acquiring the Toyota of Nashua dealership, McGovern experienced 
a number of challenges to increasing the store's profitability.  
He felt he needed to "change the culture" of the dealership to 
improve its performance.  McGovern testified that he sought out 
Casey because he knew that Casey was a very talented and 
intelligent general manager who worked well with employees.  
Because McGovern and Casey had formed a personal friendship, 
McGovern was aware that Casey was looking to acquire an equity 
ownership interest in a dealership.  As the trial judge found, 
"Casey was just the kind of employee that the anti-raiding 
provisions . . . [were] designed to protect from solicitation by 
. . . McGovern."  Had McGovern abided by the terms of the 2017 
restrictive covenant and refrained from soliciting Casey, it 
seems unlikely that Casey would have left Prime when he did, 
thereby depriving Prime of a key employee, and derogating the 
value of the business interest McGovern sold to Prime. 
33 
 
 
 
d.  Injunction extending length of 2017 agreement's 
restrictive covenant.  Having concluded that the 2017 
restrictive covenant was necessary to protect a legitimate 
business interest, we next turn to the propriety of the 
equitable remedy.  In so doing, we review the allowance of 
injunctive relief for error of law or abuse of discretion.  See 
King v. Town Clerk of Townsend, 480 Mass. 7, 9 (2018); U.S. Bank 
Nat'l Ass'n v. Schumacher, 467 Mass. 421, 427 (2014). 
The judge in this case elected to extend the restrictive 
covenant contained within the 2017 agreement for an additional 
year.  In fashioning equitable relief, he made clear that he had 
considered "how to enter relief that would actually serve as a 
benefit to Prime and not just a penalty to McGovern," as well as 
"how to fashion relief that would in some measure achieve for 
Prime what it bargained for in [the restrictive covenant] of the 
2017 agreement."  The judge explained that he was heavily 
influenced by evidence suggesting that McGovern had "willfully 
ignored" the terms of the 2017 agreement and "repeatedly hired 
people in a manner that [McGovern] knew would be a violation of 
that agreement."  Additionally, the judge found that when 
Prime's first motion for a preliminary injunction was denied in 
December 2017, McGovern "became emboldened in his willingness to 
ignore the contractual provisions that he [had] entered into."  
Moreover, in response to Prime's second motion for a preliminary 
34 
 
 
injunction in January 2018, McGovern submitted an affidavit to 
the court that, "to say [it] charitably, was less than candid."  
In light of this behavior, which understandably tried the 
patience of the judge, he felt compelled to extend the 
restrictive covenant period an additional year beyond the terms 
of the 2017 agreement. 
On appeal, McGovern argues that the trial judge lacked the 
authority to fashion such an equitable remedy or, in the 
alternative, that such a remedy was not warranted here.  We 
conclude that while there may be circumstances in which 
extending a restrictive covenant beyond its original term may be 
appropriate in the context of the sale of a business interest, 
the existing record of this case does not warrant such an 
extension. 
 
At least in the employment context, we have emphasized the 
gravity of, and have strictly enforced, restrictions on awarding 
equitable relief beyond the scope of a restrictive covenant 
contained within a traditional noncompetition agreement.  
Because such agreements serve as a direct restraint on an 
individual employee's ability to earn a living, we have not 
allowed the extension of the period of restraint beyond the 
35 
 
 
terms of the agreement.18  See All Stainless, Inc., 364 Mass. at 
777 ("because the period of the [restrictive covenant] has 
expired, [the plaintiff] is left to the recovery of any damages 
arising from [the violation of the covenant]"); Sherman v. 
Pfefferkorn, 241 Mass. 468, 477 (1922) (holding, in context of 
employment noncompetition agreement, that "the contract bounds 
the rights of the parties as to time, and after the expiration 
of the period the prohibition ceases to exist; on this record 
the plaintiff ought not to be afforded equitable relief for a 
time beyond that for which the individual defendant 
contracted").  See also EMC Corp. v. Arturi, 655 F.3d 75, 77 
(1st Cir. 2011) (as explained by Justice Souter, writing for 
First Circuit in employment case, "[t]he unequivocal character 
of the [Massachusetts] rule [regarding extending the terms of 
employment restrictive covenants] creates a frosty climate for 
[a company's] attempt to avoid it" [footnote omitted]); A-Copy, 
Inc. v. Michaelson, 599 F.2d 450, 452 (1st Cir. 1978) 
(explaining, in another case involving restrictive covenant in 
employment context, that "the Supreme Judicial Court of 
Massachusetts has indicated that when the period of restraint 
has expired, even where the delay was substantially caused by 
                     
 
18 We need not decide today whether there are any possible 
circumstances under which a traditional employee noncompetition 
agreement equitably may be extended beyond its terms. 
36 
 
 
the time consumed in legal appeals, specific relief is 
inappropriate and the injured party is left to his damages 
remedy").19  As discussed supra, however, the restrictive 
covenant at issue is not a traditional noncompetition provision 
arising in the context of an employment agreement.  We now 
consider whether, and under what circumstances, a judge may 
equitably extend the length of a restrictive covenant like the 
one at issue here, which arises in the context of a sale of 
business rather than employment. 
Covenants restricting competition arise within the realm of 
contract law.  As such, "[u]nder freedom of contract principles, 
generally, parties are held to the express terms of their 
contract."  TAL Fin. Corp. v. CSC Consulting, Inc., 446 Mass. 
422, 430 (2006).  Cf. Shahin v. I.E.S. Inc., 83 Mass. App. Ct. 
908, 909 (2013); National Med. Care, Inc. v. Zigelbaum, 18 Mass. 
App. Ct. 570, 575–576 (1984) ("We cannot rewrite the contract 
to cure an oversight or relieve a party from the consequences of 
the failure to adhere to its plain terms").  Those terms plainly 
                     
19 In limited circumstances, we have been willing, even in 
the employment context, to enforce a restrictive covenant beyond 
its expiration date by mutual agreement, see Middlesex 
Neurological Assocs., Inc. v. Cohen, 3 Mass. App. Ct. 126, 127 
n.1 (1975).  We have also been willing to extend the duration of 
a restrictive covenant in the context of the sale of a business 
where no end date had been present in the written contract and 
one was originally fashioned by a trial judge, see Wells v. 
Wells, 9 Mass. App. Ct. 321, 327-328 (1980).  No such 
circumstance is present here. 
37 
 
 
include the time period set out in the contract.  Moreover, as 
discussed supra, we greatly disfavor restrictions on an 
individual's ability to freely earn a living. 
The restrictive covenant at issue here does not, however, 
preclude anyone from earning a living.  McGovern was allowed to 
freely compete so long as he did not raid his former employer's 
employees.  The provision also did not prohibit Prime employees 
from competing with Prime generally, but just prevented them 
from working for McGovern Motors specifically, which appears to 
have been one competitor among several in the region.  The anti-
raiding provision also served a legitimate purpose, which was, 
as explained supra, to ensure that Prime received the value of 
its purchase of McGovern's interest in the company.  This 
interest would have been derogated if McGovern was allowed to 
raid the company after he sold his ownership share.  If the 
anti-raiding provision was not enforced, Prime would not receive 
the value of its purchase price. 
In this context, we conclude that awarding equitable relief 
that extends the scope of the restrictive covenant beyond its 
plain terms may be proper, but only if the party seeking to 
expand the terms of the restrictive covenant has demonstrated 
that monetary damages would provide inadequate relief.  This 
requires more than a mere articulation of the harm that the 
plaintiff has suffered.  Rather, a plaintiff must either 
38 
 
 
demonstrate why monetary damages cannot be reasonably estimated, 
or calculate the monetary damages incurred and demonstrate why 
damages would nonetheless be insufficient such that 
extraordinary relief is warranted. 
Here, the record does not reflect that Prime sought to 
extend the injunction beyond the terms of the contract due to 
either the inability to calculate or the inadequacy of damages.20  
Nor does the record demonstrate the type of threat to an ongoing 
business that cannot be compensated by money damages, or that 
money damages might not be available due to the precarious state 
of the raider's finances.  Rather, Rosenberg indicated at trial 
that Prime had not yet attempted to perform a damages 
calculation, although it intended to seek damages after the 
trial in equity.  Thus, there are no findings before this court 
as to the inadequacy of monetary damages, or the basis for that 
                     
 
20 We note that the 2017 agreement provides that Prime is 
entitled to "all damages and remedies available under applicable 
law," and that McGovern "consent[s] to the entry of preliminary 
or permanent injunctive relief . . . without the need to prove 
irreparable harm."  While this provision appears to remove the 
irreparable harm requirement from the burden in seeking a 
preliminary injunction, we do not read it as eliminating the 
need to demonstrate the insufficiency of damages to extend the 
preliminary injunction.  It is not a tolling agreement.  Both 
parties have recognized that the 2017 agreement does not include 
a tolling provision to extend the expiration of the covenant 
pending the resolution of litigation for breaches of the 
agreement.  Neither party contends that this provision serves 
the same purpose.  Indeed, neither party makes any argument 
whatsoever regarding the significance or effect of this 
provision. 
39 
 
 
inadequacy.  Indeed, because the trial was limited to the merits 
of the plaintiffs' equitable claims, the trial judge explicitly 
avoided making any findings as to damages. 
To be sure, "the task of quantifying the consequences of 
violating a noncompetition clause is a particularly difficult 
and elusive one."  Kroeger, 13 Mass. App. Ct. at 322.  
Nonetheless, Rosenberg conceded at trial that "some" of the harm 
stemming from Casey's resignation and decision to work for 
McGovern could be quantified, although Prime had not yet made 
any effort to do so.  Prime has also indicated that it valued 
the 2016 repurchase agreement's restrictive covenant at $2 
million.  Although this is a difficult task, and one that must 
take place while the clock continues to tick on the time limit 
governed by the restrictive covenant, we conclude that it must 
still be undertaken prior to a court-ordered extension of the 
restriction.21 
                     
 
21 As previously noted, this agreement contained no tolling 
provision.  Prime was a sophisticated party represented by 
capable counsel, yet it did not insist on the inclusion of such 
a provision in the 2017 agreement.  See EMC Corp. v. Arturi, 655 
F.3d 75, 77 (1st Cir. 2011) ("Being forewarned, [the plaintiff] 
could have contracted . . . for tolling the term of the 
restriction during litigation, or for a period of restriction to 
commence upon preliminary finding of breach.  But it did not"). 
 
 
Nor was there any other mutually assented to extension or 
stay of the restrictive covenant.  Mutually assented to 
extensions have been deemed enforceable, as they present a 
different set of concerns from court-ordered extensions.  See 
40 
 
 
We recognize that the trial judge extended the duration of 
the restrictive covenant in response to McGovern's 
misrepresentations to the court and his otherwise apparent 
disregard of the court's guidance on the first preliminary 
injunction motion.  McGovern's sharp and slick business 
practices are undoubtedly deeply troubling,22 but the judge must 
nevertheless first evaluate the adequacy of monetary damages 
before extending a restrictive covenant beyond the clear terms 
of the provision.  There is no evidence in this record to 
indicate that money damages could not adequately compensate 
Prime for its lost employees or that McGovern's finances are so 
precarious that equitable relief must be accelerated.  
Accordingly, we conclude it was an abuse of discretion for the 
trial judge to extend the duration of the restrictive covenant 
                     
Middlesex Neurological Assocs., Inc., 3 Mass. App. Ct. at 127 
n.1. 
 
22 We note that the same could be said for Rosenberg and 
Abram's conduct in trying to induce McGovern to sell his 
minority interest in Prime before a liquidity event.  As 
discussed, Abram's company was the majority shareholder in a 
closely held corporation and thus owed a fiduciary duty "to deal 
with the minority with the utmost good faith and loyalty."  
Wilkes v. Springside Nursing Home, Inc., 370 Mass. 842, 850 
(1976).  Despite this, Abrams and Rosenberg went so far as to 
amend Prime's operating agreement to prevent McGovern from 
gaining access to the company's financial information or 
receiving a distribution of profits sufficient to cover his tax 
liabilities. 
 
41 
 
 
absent a finding that monetary damages would provide inadequate 
relief.23 
3.  Conclusion.  For the foregoing reasons, we reverse the 
judgment of the Superior Court extending the length of the 2017 
restrictive covenant.  The case is remanded to the Superior 
Court for further proceedings consistent with this opinion.24 
 
 
 
 
 
 
So ordered. 
                     
 
23 The trial judge declined to enjoin Fallows, Tully, or 
Casey from continuing to work for McGovern, and Prime has not 
appealed from these rulings.  Accordingly, we need not address 
the propriety of exercising the trial court's equitable powers 
to prohibit an individual from continuing to work for a 
competitor, where the competitor is subject to a restrictive 
covenant but the individual employee is not. 
 
 
24 Under the 2017 agreement, the "prevailing party" in 
litigation to enforce the rights contained within that agreement 
is entitled to reasonable attorney's fees.  The plaintiffs have 
requested an award of appellate attorneys' fees pursuant to this 
provision.  In light of this court's ruling, the request for 
attorney's fees is denied.  See Yorke Mgt. v. Castro, 406 Mass. 
17, 20 (1989).