Gattineri v. Wynn MA, LLC

93 F.4th 505

Anthony GATTINERI, Plaintiff, Appellant, v. WYNN MA, LLC; Wynn Resorts Limited, Defendants, Appellees.

No. 22-1117

United States Court of Appeals, First Circuit

February 20, 2024

APPEAL FROM THE UNITED STATES DISTRICT COURT, FOR THE DISTRICT OF MASSACHUSETTS [Hon. F. Dennis Saylor, IV, Chief U.S. District Judge]

Stephen F. Gordon, with whom Todd B. Gordon, Robert A. DiSorbo, Kevin A. Robinson, and The Gordon Law Firm LLP were on brief, for appellant.

Samuel M. Starr, with whom Caitlin A. Hill and Mintz, Levin, Cohn, Ferris, Glovsky & Popeo, P.C. were on brief, for appellees.

Before Barron, Chief Judge, Lynch and Gelpí, Circuit Judges.

GELPÍ, Circuit Judge.

Appellant Anthony Gattineri ("Gattineri") brought this action against Appellees Wynn MA, LLC, and Wynn Resorts, Limited (collectively, "Wynn"), alleging breach of contract, common law fraud, and unfair and/or deceptive trade practices in violation of Mass. Gen. Laws. ch. 93A, § 2(a). Wynn moved for summary judgment, which the United States District Court for the District of Massachusetts granted on all counts in favor of Wynn. Gattineri appealed. Recognizing that Gattineri's claims hinge on important questions of Massachusetts law and public policy, we certified two questions to the Massachusetts Supreme Judicial Court ("SJC"), see Gattineri v. Wynn MA, LLC, 63 F.4th 71 (1st Cir. 2023). The SJC issued an opinion responding to our questions, see Gattineri v. Wynn MA, LLC, 493 Mass. 13, 221 N.E.3d 742 (2023), after which the parties filed supplemental briefs addressing the resolution of this appeal in light of the SJC's opinion. For the reasons below, we now affirm the district court's grant of summary judgment on the grounds provided by the SJC.

I. BACKGROUND

A. Relevant Facts

The facts are set out in our prior opinion, Gattineri, 63 F.4th, and in the SJC's opinion, Gattineri, 221 N.E.3d. We set forth in greater detail certain facts we find particularly relevant. The story begins with an Option Agreement for the purchase of a parcel of land (the "Parcel") in Everett and Boston, Massachusetts, for the construction of the Encore Boston Harbor resort and casino, owned by Wynn. The Option Agreement, entered into in December 2012 between Encore and FBT Realty, LLC ("FBT"), of which Gattineri is a 46.69% owner, gave Encore the option to purchase the Parcel from FBT for $75 million. In January 2013, Encore filed an application with the Massachusetts Gaming Commission ("Commission") for a gaming license to operate a casino in Massachusetts, as required by state law. Thereafter, the Commission's Investigation and Enforcement Bureau ("IEB") conducted a suitability investigation of each applicant for the gaming license, including Encore and Wynn.

During the licensing process, the Commission had reason to become concerned about whether an organized crime figure, through Gattineri, was part of FBT's membership makeup at the time of the Option Agreement. In 2009 and 2010, Charles Lightbody ("Lightbody"), a convicted felon and associate of La Cosa Nostra, was one of the owners of record of FBT. FBT and Gattineri represented to the Commission that, at the time of the 2012 execution of the Option Agreement, FBT was owned only by Gattineri, Dustin DeNunzio, and Paul Lohnes. Yet, in December 2012, in a recorded prison phone call, Lightbody referenced his ownership interest or control of the Parcel and the need to conceal it from the Commission. And in July 2013, Gattineri had told the police that he owed Lightbody "like, a million," and said, "If I don't pay him, he can take it away from me."

The Commission informed Wynn of its concerns about undisclosed interests in FBT so that Wynn could address them. In response to the Commission's concerns, in November 2013, Encore and FBT entered into a Ninth Amendment to the Option Agreement, reducing the purchase price for the Parcel to $35 million, a figure that reflected the fair market value of the Parcel assuming that it would not be used for gaming purposes. The Commission subsequently approved the Ninth Amendment. Such approval, however, was conditioned on the purchase price not exceeding $35 million and the requirement that the three publicly known members of FBT sign a certification stating that they were the exclusive recipients of the sale proceeds. As the SJC made clear, "Gattineri was [ ] a person of particular interest to the commission, as he not only was one of the three principals of FBT but had also bought out the convicted felon's ownership interest in FBT and still owed him money at the time of the investigation" into the possibility of concealed ownership interests by the convicted felon. Gattineri, 221 N.E.3d at 744. While DeNunzio and Lohnes signed the certificates, Gattineri repeatedly refused to do so unless he was given what he contended was his share of the price reduction required by the Commission.

The Commission also directed the IEB to deliver its files to the U.S. Attorney, the Attorney General of Massachusetts, and the district attorney for Suffolk County. As the SJC noted, Gattineri was indicted in federal court and arraigned on state court criminal proceedings.¹ Id. at 747.

Gattineri's arguments, including as to his Chapter 93A claim, purport to be based on the very actions Wynn took to respond to the Commission's concerns, including his dealings with the three prosecutors. Throughout these events, as detailed by the SJC, Wynn was under a continuing duty to provide assistance and information required by the Commission and to cooperate in any inquiry or investigation by the Commission. See id. at 750.

On June 14, 2014, Gattineri met with Robert DeSalvio, Senior Vice President of Development of Wynn Resorts Development, LLC, in San Diego, California. Gattineri alleges that, at the meeting, the two orally agreed to the following: "If Anthony Gattineri signed the required certificate and Wynn obtained the casino license for a casino on the [Parcel], Wynn would make Anthony Gattineri whole" (an alleged contract we term the "San Diego Agreement"). Per Gattineri, "mak[ing him] whole" would involve Wynn paying him approximately $19 million, calculated as Gattineri's proportional share of the $40 million purchase price reduction. The San Diego Agreement was neither put in writing nor communicated to the Commission. That same day, Gattineri signed the required certification.

In September 2014, the Commission granted Encore the gaming license. Encore subsequently purchased the Parcel for $35 million. Gattineri was not paid the additional $19 million.

B. Procedural History

In June 2018, Gattineri filed this action against Wynn in the United States District Court for the District of Massachusetts, alleging (1) breach of contract, (2) common law fraud, and (3) unfair and/or deceptive trade practices in violation of Mass. Gen. Laws. ch. 93A, § 2(a). Wynn sought summary judgment, which the district court granted on all counts in favor of Wynn, concluding that (1) the San Diego Agreement is an "unenforceable illegal contract" under Mass. Gen. Laws ch. 23K; (2) an essential term of the San Diego Agreement - - the amount that Gattineri would be paid in exchange for his signature - - was too indefinite and uncertain to form a valid contract; (3) Gattineri's claimed reliance on Wynn's representations was too unreasonable, foreclosing a claim for common law fraud; and (4) Gattineri's Chapter 93A claim was barred because it is "wholly derivative" of his breach of contract and common law fraud claims.

Gattineri appealed, requesting reversal based on an alleged taint caused by ex parte communication between the district court courtroom clerk and Wynn's counsel. Gattineri further argued that the district court erred in granting Wynn's motion for summary judgment because (1) the San Diego Agreement does not violate Mass. Gen. Laws ch. 23K; (2) even if the San Diego Agreement did violate Mass. Gen. Laws ch. 23K, it should still be enforced because the parties are not in pari delicto; (3) the terms of the San Diego Agreement are sufficiently definite and certain; (4) Gattineri's reliance on Wynn's alleged promise to make him whole was reasonable; and (5) Gattineri's Chapter 93A claim is not wholly derivative of his breach of contract and common law fraud claims.

In our earlier disposition of this appeal, we rejected Gattineri's improper ex parte communication claim and in pari delicto argument, and we concluded that there are genuine disputes of material facts related to Gattineri's breach of contract and common law fraud claims. Gattineri, 63 F.4th at 83. We then determined that the success of Gattineri's claims hinges on whether the San Diego Agreement is unenforceable as contrary to state law and/or as a violation of public policy. Id. Thus, we certified the following two questions to the SJC:

1) Is the San Diego Agreement unenforceable because it violates Section 21 of the Gaming Act?²

2) If not, is the San Diego Agreement unenforceable for reasons of public policy of ensuring public confidence in the integrity of the gaming licensing process and in the strict oversight of all gaming establishments through a rigorous regulatory scheme?

Id. at 95.

On November 3, 2023, the SJC issued its opinion, see Gattineri, 221 N.E.3d.³ The SJC held:

An agreement, concealed from the commission empowered to review and approve casino licenses, and inconsistent with the terms presented to, and approved by, the commission to address its concerns about the possible involvement of organized crime, is unenforceable as a violation of public policy. Because we hold that the San Diego agreement is unenforceable for public policy reasons, we need not and do not answer the first question, regarding whether it also violates § 21 of the [G]aming [A]ct.

Id. at 752. We then ordered the parties to file supplemental briefs addressing the resolution of this appeal in light of the SJC's opinion. Applying the SJC's response and considering the parties'...