NEW DIA LLC v. VICENTE SEDERBERG LLP (2026)

MEMORANDUM AND ORDER PURSUANT TO RULE 23.0

The plaintiffs, New Dia, LLC (New Dia), and Ross Bradshaw, appeal from the dismissal of their Superior Court complaint against defendant Vicente Sederberg, LLP (Vicente), a Colorado law firm that represented CR Operator Holdings, LLC (CRO), in a proposed purchase of New Dia in which Vicente agreed to act as escrow agent. The plaintiffs argue that the judge erred in ruling that their complaint, as amended, failed to state claims against Vicente including for breach of contract and breach of fiduciary duty, and that the judge abused his discretion in ruling that the plaintiffs’ proposed further amendment of the complaint would be futile. We affirm.

Background. We take the facts in the light most favorable to the plaintiffs as alleged in the first amended complaint.² See Williamson v. Barlam, 103 Mass. App. Ct. 727, 732 (2024), citing Buffalo-Water 1, LLC v. Fidelity Real Estate Co., LLC, 481 Mass. 13, 17 (2018).

In 2018, the Cannabis Control Commission (CCC) awarded to New Dia a license to operate a marijuana dispensary. New Dia's primary owner was Bradshaw. In 2021, CRO and its affiliated entities, defendants TRP Holdco, LLC; Cookies Retail, LLC; and Cookies Holdings, LLC (collectively, CRO parties), approached the plaintiffs seeking to acquire an ownership interest in New Dia. In the ensuing negotiations, Vicente, a law firm specializing in the cannabis industry, represented CRO. The plaintiffs were represented by a Worcester law firm and a cannabis business consultant.

On June 10, 2021, the plaintiffs and CRO entered into a membership interest purchase agreement (MIPA) under which CRO would purchase a forty-nine percent interest in New Dia. The MIPA provided that the closing would take place “no later than three (3) Business Days after the satisfaction of all conditions to closing,” which included obtaining the CCC's approval of the change of ownership of New Dia. The MIPA also provided that, contemporaneous with their execution of the MIPA, both the plaintiffs and CRO “shall sign” certain ancillary documents (closing documents).³ Section 2.6 of the MIPA provided that Vicente would act as escrow agent by holding the closing documents “in trust until the [c]losing, at which time [Vicente] shall release the documents [to CRO and New Dia].”

Vicente, touting its special knowledge and experience with the CCC's processes, insisted on handling the application to the CCC for the change in ownership of New Dia. Because the CCC's change of ownership form cautioned that failure to obtain CCC approval “prior to” a change of ownership could void a marijuana dispensary license, Vicente instructed both the plaintiffs and CRO to submit with the application a fully executed copy of the MIPA, but unsigned copies of the closing documents, to avoid any appearance that New Dia and CRO had consummated the transaction before obtaining CCC approval. The plaintiffs signed only those closing documents that Vicente instructed the plaintiffs to sign and turned them over to Vicente pending the CCC's approval. As for the closing documents that Vicente had directed should not yet be signed, once the CCC gave its approval Vicente was supposed to obtain signatures on those closing documents, and to release all of the signed closing documents at the closing. Vicente submitted the change of ownership application to the CCC, which approved the application almost ten months later.

Over the next several months, the plaintiffs attempted numerous times to schedule the closing, maintaining that with CCC approval all preconditions for the closing had been satisfied. However, the CRO parties refused to schedule the closing, claiming that CRO did not have the funds, and tried unsuccessfully to renegotiate the terms of the MIPA. The plaintiffs requested that Vicente release the closing documents, but Vicente did not. Vicente did not respond to Bradshaw's multiple e-mail messages trying to schedule the closing and asking whether, in Vicente's view, any preconditions to closing remained unfulfilled. Eventually the CRO parties announced their intent to walk away from the transaction.

The plaintiffs filed a complaint against the CRO parties and Vicente seeking specific performance of the MIPA. After Vicente served the plaintiffs with a motion to dismiss, the plaintiffs filed the first amended complaint, adding claims including ones against Vicente for breach of contract, declaratory judgment, and breach of fiduciary duty. Based on a provision of the MIPA, the plaintiffs’ claims against the CRO parties were submitted to arbitration, and the plaintiffs dismissed their Superior Court claims against the CRO parties, which have not participated in this appeal.

On June 11, 2025, the plaintiffs filed a motion for leave to file a second amended complaint. With the motion, the plaintiffs filed an unsigned document captioned “[PROPOSED] SECOND AMENDED COMPLAINT,” marked “DRAFT” on each page. Vicente renewed its motion to dismiss the first amended complaint and opposed the plaintiffs’ motion for leave to file the second amended complaint. After a hearing, a judge allowed Vicente's motion to dismiss the first amended complaint and denied the plaintiffs’ motion for leave to file the second amended complaint. Judgment entered for Vicente, and the plaintiffs appeal.

Discussion. 1. Dismissal of complaint. The plaintiffs argue that the judge erred in dismissing their complaint for failure to state a claim upon which relief can be granted, Mass. R. Civ. P. 12 (b) (6), 365 Mass. 754 (1974). We review de novo the allowance of a motion to dismiss, and “[w]e limit our consideration to the factual allegations in the [plaintiffs’] complaint, taking them as true and drawing all reasonable inferences in the plaintiff[s’] favor” (quotation and citation omitted). Williamson, 103 Mass. App. Ct. at 732. To survive a motion to dismiss for failure to state a claim, a complaint “ ‘requires more than labels and conclusions’ and must contain ‘allegations plausibly suggesting (not merely consistent with)’ an entitlement to relief.” Lipsitt v. Plaud, 466 Mass. 240, 252 (2013), quoting Iannacchino v. Ford Motor Co., 451 Mass. 623, 636 (2008), and Bell Atl. Corp. v. Twombly, 550 U.S. 544, 557 (2007).

The plaintiffs argue that their proposed second amended complaint “plausibly pleaded” claims sufficient to survive a motion to dismiss. As mentioned, supra note 2, no attorney certified that document by signing it, see Mass. R. Civ. P. 11 (a) (1), as appearing in 488 Mass. 1403 (2021). In any event, the judge considered the proposed second amended complaint, and, in a thorough memorandum of decision, discussed each of the plaintiffs’ claims and proposed claims.⁴ Thus, whether we apply the Rule 12(b)(6) standard to the first amended complaint or to the unsigned proposed second amended complaint, the result is the same.

The first amended complaint alleged that Vicente breached its duties to the plaintiffs as “escrow agent.” The judge concluded that Vicente was not a party to the MIPA, and Vicente's only obligation, under § 2.6 of the MIPA, was to act as escrow agent. See Matter of Hilson, 448 Mass. 603, 614 (2007). Vicente's duty as escrow agent was merely to hold the closing documents until the closing, and in doing so owed a fiduciary duty to both CRO and the plaintiffs. Zang v. NRT New England Inc., 77 Mass. App. Ct. 665, 670 (2010). In those circumstances, we agree that the plaintiffs did not state claims against Vicente for the causes of action alleged in the first amended complaint -- breach of contract, declaratory judgment, and breach of fiduciary duty. Contrast Williamson, 103 Mass. App. Ct. at 734-735 (allegations that defendants, who were parties to condominium agreement, impeded sale of plaintiff's condominium sufficed to plead tortious interference with contract).

In both their first amended and proposed second amended complaints, the plaintiffs acknowledged that “Vicente was [CRO's] counsel,” and that § 2.6 of the MIPA set forth Vicente's duties as escrow agent. In addition, the proposed second amended complaint stated that Vicente owed duties to the plaintiffs not only as escrow agent, but also as “counsel advising the parties as to obtaining regulatory approval and closing on the transaction, and a common-law agent beholden to buyer and seller as its principals.”

The judge concluded that the proposed second amended complaint “does not plausibly allege that Vicente agreed to serve as [p]laintiffs’ counsel, either explicitly or implicitly, or otherwise had a duty to respond to [p]laintiffs[’] inquiries regarding the extent of CRO's compliance with the MIPA.” The judge further concluded that the plaintiffs’ proposed second amended complaint did not set forth claims against Vicente, including the new claims they sought to add for breach of the covenant of good faith and fair dealing, equitable estoppel, tortious interference with advantageous business relations, and unfair or deceptive business practices in violation of G. L. c. 93A.

We agree. The plaintiffs’ attempts in their proposed second amended complaint to recast Vicente's escrow agent role as that of the plaintiffs’ counsel or common-law agent are no more than “ ‘mere labels and conclusions.’ ” Lipsitt, 466 Mass. at 252, quoting Iannacchino, 451 Mass. at 636. “[W]hile an attorney in Massachusetts may owe a duty to a nonclient whom the attorney knows, or reasonably should foresee, will rely on his or her services, such a duty is less likely to be imposed ‘where an attorney is also under an independent and possibly conflicting duty to a client.’ ” Baker v. Wilmer Cutler Pickering Hale and Dorr LLP, 91 Mass. App. Ct. 835, 846 (2017), quoting Robertson v. Gaston Snow & Ely Bartlett, 404 Mass. 515, 524 (1989).

2. Denial of motion for leave to file second amended complaint. As for the plaintiffs’ argument that the judge should have granted them leave to file the second amended complaint, we review that ruling for an abuse of discretion. See Doull v. Foster, 487 Mass. 1, 22 (2021). The plaintiffs bear the burden to show that the judge abused that discretion. See Chang v. Winklevoss, 95 Mass. App. Ct. 202, 212 (2019). A party may amend a complaint “once as a matter of course,” Mass. R. Civ. P. 15 (a), 365 Mass. 760 (1974), and here the plaintiffs did so when they filed their first amended complaint. See Lipsitt, 466 Mass. at 254. Under rule 15 (a), subsequent amendment requires either consent of the adverse party or “leave of court,” which shall “be freely given when justice so requires.” However, a judge has discretion to deny leave to amend for reasons including “futility of the amendment.” Doull, supra. A motion to amend is futile if the claims, as amended, would not survive a motion to dismiss under Mass. R. Civ. P. 12 (b) (6). See Chang, supra.

The proposed second amended complaint did not add any new facts about Vicente's representation of the CRO parties or the plaintiffs’ representation by separate counsel during the negotiations. Rather, the proposed second amended complaint merely tried to recast Vicente's role as escrow agent under § 2.6 of the MIPA into that of the plaintiffs’ “counsel” or “common-law agent.” Based on his analysis of the claims set forth in the plaintiffs’ proposed second amended complaint, the judge concluded that amendment would be futile. For the reasons already discussed, we discern no abuse of discretion. See Chang, 95 Mass. App. Ct. at 212.⁵

Judgment affirmed.

FOOTNOTES

2.   In the statement of facts in their brief, the plaintiffs cite to a document in the record appendix captioned “[PROPOSED] SECOND AMENDED COMPLAINT.” That document is marked “DRAFT” on each page and is unsigned. Because no attorney has signed that document to certify “that to the best of the attorney's knowledge, information and belief there is a good ground to support it,” Mass. R. Civ. P. 11 (a) (1), as appearing in 488 Mass. 1403 (2021), we take the facts from the first amended complaint. In any event, as discussed below, the judge considered the facts set forth in the proposed second amended complaint and concluded that amendment would be futile.

3.   The plaintiffs’ closing documents included a seller's certificate, an executed bill of sale, an operating agreement, a post-closing retail licensing agreement, and an advisory agreement. CRO's closing documents included a buyer's officer certificate, its $400,000 cash payment (due at closing), a purchase promissory note for $1.6 million, and the operating agreement.

4.   The first amended complaint sought specific performance of the MIPA. In his memorandum of decision dismissing the complaint, the judge noted that issues related to specific performance were considered in the arbitration. The plaintiffs do not raise any issue on appeal as to the dismissal of their specific performance claim against Vicente, and so we do not consider that issue.

5.   In our discretion, Vicente's request (for appellate attorney fees pursuant to Mass. R. A. P. 25, as appearing in 481 Mass. 1654 (2019), and Yorke Management v. Castro, 406 Mass. 17, 20 (1989), is denied.