OLD IRONSIDES ENERGY LLC v. MARSH MCLENNAN AGENCY LLC (2026)

MEMORANDUM AND ORDER PURSUANT TO RULE 23.0

The plaintiff, Old Ironsides Energy LLC, appeals from a summary judgment entered by a Superior Court judge in favor of the defendants, Marsh & McLennan Agency LLC (agency) and various related entities and individuals. We conclude that the judge properly struck the relevant portions of the plaintiff's expert's opinion, which were based on speculation about what actions the law firm retained by the plaintiff might have performed. Further concluding that a jury would be unable to determine without a proper expert opinion what attorney's fees, if any, would be reasonable in responding to a United States Securities and Exchange Commission (SEC) investigation, we affirm the grant of summary judgment.

1. Background. In 2013, the plaintiff, a private equity firm, asked the agency, an insurance broker, to obtain insurance coverage for it. The plaintiff contends that it asked the agency to secure broad insurance coverage, including coverage for attorney's fees incurred by the plaintiff or its officers in responding to formal investigations. The defendants contend that the plaintiff requested a policy covering only the individual officers. In any event, the agency obtained a policy for the plaintiff regarding formal investigations that covered only individual officers.

In April 2016, the plaintiff came under SEC investigation. The insurance policies that the plaintiff obtained through the agency covered at least a portion of the attorney's fees incurred by the plaintiff's individual officers, but not the attorney's fees incurred by the plaintiff, which were primarily through the services of Cleary Gottlieb Steen & Hamilton (Cleary). The plaintiff sued the defendants for breach of contract, negligence, breach of fiduciary duty, negligent misrepresentation, and violations of G. L. c. 93A.

In 2019, the defendants served on the plaintiff discovery requests for “attorney fee invoices, with complete timekeeper or diary entries, for all legal work performed for Old Ironsides in connection with this SEC matter.” The plaintiff produced only invoice cover sheets. The plaintiff asserted that the rest of the responsive documents were protected by attorney-client privilege because of the “still-active SEC matter,” and that production would subject those documents to discovery by the SEC.²

In December 2023, the plaintiff's expert produced a report on the reasonableness of the claimed attorney's fees. Because of the nondiscovery, the report was based on such things as what his “expectation would be” about Cleary's engagement on the SEC matter, what “Cleary surely” did, what time “counsel would have expended,” and on work that would be “no surprise.” In February 2024, the day before the defendants’ deposition of the plaintiff's expert, the plaintiff produced additional pages from the invoices along with billing summaries. The plaintiff explained that “defendants’ expert raised an opinion that there was insufficient documentation of the fees; our expert asked to see additional documents so he could put that issue to bed; that's what we gave him, what he asked for.” The defendants moved to exclude the late discovery and the expert's related opinion. In August 2024, a Superior Court judge allowed the motion, explaining that “parties are not permitted to withhold documents based on objections, whether or not those objections are tested on a motion to compel, and then produce those same documents (or a subset thereof) when convenient to them.”

In January 2025, without seeking reconsideration of the prior order, the plaintiff told the defendants that it intended to produce the unredacted legal invoices and diary entries from Cleary related to the SEC matter. A different Superior Court judge ordered the plaintiff to comply with the prior ruling and barred it from introducing or relying on the “deliberately withheld” material.³

Both parties moved for summary judgment. The second judge allowed the defendants’ motion to strike the plaintiff's expert's opinion on the reasonableness of attorney's fees for being “conclusory and speculative,” and subsequently for summary judgment because the plaintiff “cannot prove that it suffered compensable injury without admissible expert testimony.” This appeal followed.

2. Standard of review. “We review a decision to grant summary judgment de novo.” Zaleskas v. Brigham & Women's Hosp., 97 Mass. App. Ct. 55, 60 (2020). “[S]ummary judgment is proper where proof of an essential element of a party's claim ‘is unlikely to be forthcoming at trial.’ ” Spencer v. Doyle, 50 Mass. App. Ct. 6, 8 (2000), quoting Flesner v. Technical Communications Corp., 410 Mass. 805, 809 (1991). “A nonmoving party's failure to establish an essential element of [its] claim ‘renders all other facts immaterial’ and mandates summary judgment in favor of the moving party.” Roman v. Trustees of Tufts College, 461 Mass. 707, 711 (2012), quoting Kourouvacilis v. General Motors Corp., 410 Mass. 706, 711 (1991).

3. Striking of the relevant portions of the plaintiff's expert's opinion. “The decision to exclude expert testimony rests in the broad discretion of the judge and will not be disturbed unless the exercise of that discretion constitutes an abuse of discretion or other error of law.” Palandjian v. Foster, 446 Mass. 100, 104 (2006). Accord Kiribati Seafood Co. v. Dechert LLP, 478 Mass. 111, 124 (2017). “An expert should not be permitted to give an opinion that is based on conjecture or speculation from an insufficient evidentiary foundation.” Minkina v. Frankl, 86 Mass. App. Ct. 282, 292 (2014), quoting Van Brode Group, Inc. v. Bowditch & Dewey, 36 Mass. App. Ct. 509, 520 (1994).

Here, the second Superior Court judge struck the plaintiff's expert's opinions “that the fees paid by Old Ironsides were reasonable, and [the expert's] summary of the time and scope of the SEC investigation.” The judge struck the former because the expert “failed to disclose any meaningful basis for those opinions” and the latter because “it constitutes inadmissible hearsay.” As stated, the expert (through no fault of his own) lacked any concrete information about what tasks Cleary performed and was forced to base his opinions on his expectations and assumptions about what work a law firm might perform relative to an SEC investigation. The summary judgment record is devoid of any details about the tasks completed by Cleary on the plaintiff's behalf, and why they were required. Assumptions about what Cleary might have done are not a proper basis for determining the reasonableness of its fees. See Palandjian, 446 Mass. at 108. This was true regardless of the expert's qualifications. See Abdulky v. Lubin & Meyer, P.C., 102 Mass. App. Ct. 441, 452 (2023), cert. denied, 144 S. Ct. 806 (2024) (“Simply setting forth an expert's experience, and that he did some research, is not sufficient when the expert's application of his methodology to the facts is not disclosed”). Accordingly, the second judge acted within his discretion by excluding these portions of the expert's opinion.

4. Damages. To avoid summary judgment, the plaintiff needed to demonstrate a likelihood that it could prove damages at trial. See Spencer, 50 Mass. App. Ct. at 8. We have no doubt that there are situations where a lay jury can discern that some amount of attorney's fees was reasonably expended. The case here, however, involved an SEC investigation of a private equity firm, a matter well beyond the ken of an ordinary layperson. Whether and when it would be reasonable for a private equity firm to hire attorneys at all to respond to SEC inquiries is not a matter that is intuitively obvious or within the common experience of jurors. “The test for determining whether a particular matter is a proper one for expert testimony is whether the testimony will assist the jury in understanding issues of fact beyond their common experience.” Herbert A. Sullivan, Inc. v. Utica Mut. Ins. Co., 439 Mass. 387, 402 (2003). See also Commonwealth v. Smith, 92 Mass. App. Ct. 417, 421 (2017), quoting Commonwealth v. Boyarsky, 452 Mass. 700, 716 (2008) (“The role of an expert witness is to help jurors interpret evidence that lies outside of common experience”). Discerning even a reasonable range of expenditures in response to an SEC investigation is well beyond the common experience even of many attorneys. See Herbert A. Sullivan, Inc., supra. Because of the topic's complexity, expert testimony was required for a trier of fact to determine whether the plaintiff suffered reasonable damages. See id. See also Kline v. Shearwater Ass'n, Inc., 63 Mass. App. Ct. 825, 838 n.25 (2005) (“It was within the judge's discretion to require expert testimony as to the unreasonableness of the attorney's fees”).

The legal invoice cover sheets, when paired with Cleary's standard rates, do not establish that the plaintiff incurred reasonable attorney's fees. Without details of the legal work performed on the plaintiff's behalf, and expert testimony on the reasonableness of that work, it is not possible for a jury to parse what fees were compensable among the millions of dollars in claimed costs without resorting, as the plaintiff's expert was forced to do, to speculation. See Continental Assur. Co. v. Diorio-Volungis, 51 Mass. App. Ct. 403, 410 (2001) (“If a necessary part of the case is left to pure speculation, or if a vital portion of proof is established by a mere scintilla of evidence, then the plaintiff has not met the burden of proof”). Accordingly, the defendant is entitled to summary judgment because the plaintiff has no likelihood of proving compensable injury, an essential element of its claim. See Ahearn v. Vose, 64 Mass. App. Ct. 403, 412-413 (2005), quoting Kourouvacilis, 410 Mass. at 716 (“[A] party moving for summary judgment in a case in which the opposing party [has] the burden of proof at trial is entitled to summary judgment if he demonstrates, by reference to materials described in Mass. R. Civ. P 56[c], [365 Mass. 824 (1974),] unmet by countervailing materials, that the party opposing the motion has no reasonable expectation of proving an essential element of that party's case”).⁴

Judgment affirmed.

FOOTNOTES

2.   Even though the SEC matter concluded in April 2020, the plaintiff withheld the unredacted invoices for the remainder of the discovery period, which concluded in November 2023.

3.   No party challenges the propriety of this order, or of the August 2024 order.

4.   The plaintiff also appeals the award of costs in favor of the defendants, but only on the basis that the summary judgment should be reversed.