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Full text of "Report of the Attorney General for the year ending .."

Public Document 



No. 12 



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REPORT 



OF THE 



ATTORNEY GENERAL 



FOR THE 



Year Ending June 30, 1994 




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Publication of this Document Approved by Philmore Anderson iii. State Purchasing Agent. 



17800-244-800-1 /96-AGO-I45090100 



Estimated Cost Per Copy 5.63 
Printed on Recycled Paper 

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Commonwealth of Massachusetts 

In accordance with the provisions of Section 11 of Chapter 
12 and of Chapter 32 of the General Laws, I hereby submit the 
Annual Report for the Office of the Attorney General. This 
Annual Report covers the period from July 1, 1993 to June 30, 
1994. 

Repectfully Submitted, 

Scott Harshbarger 
Attorney General 



OFFICE OF THE ATTORNEY GENERAL 

ATTORNEY GENERAL 
SCOTT HARSHBARGER 

FIRST ASSISTANT ATTORNEY GENERAL 
Thomas H. Green 

CHIEF OF STAFF 
Donald L. Davenport 



Assistant Attorneys General ; 

Jonathan Abbott 2 
Richard Allen 
Thomas Alpert 62 
Dorothy Anderson 
Barbara Anthony 
Frederick Augenstern 
Thomas Barnico 
Judith Seals 
Thomas Bean 
Steven Berenson 
Edward Berlin 
Anne Berlin 
Cynthia Berliner 
Jean Berke 
William Berman 
Patricia Bernstein 
Ann Berwick 
Mark Bluver 
Edward Bohlen 
Barbara Boden 
David Bookbinder 
John Bowen 
John Bowman 
Howard Brick 
Matthew Brock 67 
William Brownsberger 
James Bryant 
Brian Burke 2 
David Burns 
John Capin 
Eric Carriker 
James Caruso, Jr. 
R. Michael Cassidy 
John Ciardi 
Richard Cole 
Mary Connaughton 53 
Joanna Connolly 
Scott Cooper 
Pierce Cray 
Phyllis Crockett 
Michael Cullen 



Maurice Cunningham 
William Daggett 
Leslie Davies 
Scott Davis 
Edward DeAngelo 
George Dean 
Beatriz delRio 19 
Emily Den 
Stephen Dick 
Carol Dietz 
Elizabeth DiTomassi 
Juliane Dow 63 
William Duensing 
Edgar Dworsky 61 
Deborah Ecker 
Stanley Eichner 
Judith Fabricant 
Michael Fabbri 

Jennifer Ferreira 

Freda Fishman 

Francis Flaherty, Jr. 13 

Elizabeth Ann Foley 

Bettye Freeman 52 

Cynthia Gagne 

Andree Gagnon 

Rosemary Gale 

Nancy Geary 

Salvatore Giorlandino 10 

I. Andrew Goldberg 

Richard Goldstein 

Tania Gray 

Thomas Green 

Leslie Greer 

Mary Griffin 

Irene Guild 

Kristin Guyot 

David Hallett 

Daniel Halston 58 

Natalie Hardy 66 

Nancy Harper 

Ladonna Hat ton 70 

Bennet Heart 

Virgina Hoefling 

Philip Holmes 

Amy Hudspeth 7 

Pamela Hunt 

Marsha Hunter 12 

Elizabeth Hyman 69 

Marcia Jackson 

Joyce Johnson 56 

Diane Juliar 

Michelle Kaczynski 



Carolyn Keshian 5 
Michele King 50 
Michael Kogut 
Pamela Kogut 
Viveca Tung Kwan 
Pablo Landrau 
Ellyn Lazar 21 
Macy Lee 8 
William Lee 
Judy Levenson 
Beth Levi 65 
Martin Levin 
Stephen Limon 
Anita Maietta 16 
Margaret Malek 64 
David Marcus 65 
Laura Maslow-Armand 9 
Gregory Massing 10 
William Matlack 
Thomas McCormick 
Ellen McGinty 
Karen McGuire 
Susan McHugh 55 
Mary McLaughlin 68 
Paul McLaughlin 
Kristine McMahon 
Kevin McNeely 
William McVey 55 
William Meade 
Elizabeth Medvedow 
Joyce Meiklejohn 
Howard Meshnick 
Nicholas Messuri 
Hoi ley Meyer 4 
James Milkey 
Jonathan Mishara 
Daniel Mitchell 
Margaret Monsell 60 
Sarah Morison 
Christopher Morog 
Madelyn Morris 
Susan Motika 
Mark Muldoon 
Timothy Mullen 
Robert Munnelly 
Kathryn Murphy 15 
Linda Murphy 
Alexander Nappan 
Kevin Nasca 
Paula Fox Niziak 
Michelle O'Brien 
Thomas O'Brien 1 
Jerrold Oppenheim 59 
Donna Palermino 



William Pardee 
Margaret Parks 
Robert Patten 
Anthony Penski 
Djuna Perkins 
Mary Phillips 
William Porter 
Cristina Poulter 10 
Anne Powers 
Edward Rapacki 
Carol Lee Rawn 
Elizabeth Reinhardt 
Shelley Richmond 3 
Benjamin Robbins 
Beverly Roby 
Anthony Rodriguez 
Joseph Rogers 
Deirdre Rosenberg 
Abbe Ross 
Stuart Rossman 
Linda Sable 
Peter Sacks 
Thomas Samoluk 
Ernest Sarason, Jr. 
Pasqua Scibelli 
Arlie Scott 
Robert Sherman 57 
Robert Sikellis 
Jeremy Silverfine 
Eleanor Sinnott 
Myles Slosberg 
Eric Smith 
Joanne Smith 
Mark Smith 
Johanna Soris 
Amy Spector 
Susan Spurlock 
Marie St. Fleur 
Carol Starkey 
Kevin Steiling 
James Stetson 
Deborah Steenland 
Edmund Sullivan 
Walter Sullivan 
Mark Sutliff 
James Sweeney 
Diane Szafarowicz 
Pamela Talbot 
Rosemary Tarantino 
Neil Tassel 
Shelly Taylor 6 
Jane Tewksbury 54 
Jean Thompson 
Jeffrey Tocchio 



Edward Toro 
Bruce Trager 11 
Margaret Van Deusen 
John Van Lonkhuyzen 
Lucy Wall 
Beverly Ward 
Rebecca Webb 
George Weber 
Mark Weber 

Joseph Whalen, III 12 
James Whitcomb 
Douglas Wilkins 
Jane Willoughby 
John Woodruff 18 
Norah Wylie 
Judith Yogman 
Pamela Young 51 
Andrew Zaikis 
Catherine Ziehl 



Assistant Attorneys General Assigned To The Department of 
Employment & Training: 

Brian Burke 
Joshua Krell 17 
Glenn MacKinlay 3 
Jean O'Brien 15 
Patricia Preziosa 



APPOINTMENT DATE 



1. 


07/18/94 


2. 


08/01/94 


3. 


08/08/94 


4. 


08/15/94 


5. 


08/17/94 


6. 


08/29/94 


7. 


09/06/94 


8. 


09/12/94 


9. 


09/19/94 


10. 


09/20/94 


11. 


09/26/94 


12. 


10/03/94 


13. 


10/17/94 


14. 


10/24/94 


15. 


10/31/94 


16. 


11/14/94 


17. 


11/22/94 


18. 


11/28/94 


19. 


12/05/94 


20. 


01/19/95 


21. 


01/30/95 


22. 


02/01/95 


23. 


02/06/95 


24. 


02/27/95 


25. 


03/01/95 


26. 


03/06/95 


27. 


03/13/95 


28. 


06/01/95 



TERMINATION DATE 



50. 


07/01/94 


51. 


07/08/94 


52. 


07/15/94 


53. 


08/02/94 


54. 


08/12/94 


55. 


08/17/94 


56. 


08/24/94 


57. 


09/09/94 


58. 


09/16/94 


59. 


09/30/94 


60. 


10/11/94 


61. 


10/28/94 


62. 


11/18/94 


63. 


11/26/94 


64. 


12/27/94 


65. 


12/30/94 


66. 


01/13/95 


67. 


01/20/95 


68. 


01/25/95 


69. 


01/28/95 


70. 


01/31/95 


71. 


02/10/95 


72. 


02/17/95 


73. 


02/28/95 


74. 


03/31/95 


75. 


04/28/95 


76. 


05/05/95 


77. 


05/31/95 



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IS: 



00 OO OO 00 



CRIMINAL BUREAU 

The Criminal Bureau is responsible for prosecuting individuals 
and corporations for violations of the criminal laws in courts at 
all levels throughout the Commonwealth. In addition, the Bureau 
represents the Commonwealth's judges, district attorneys, 
probation, parole, and corrections officials when they are sued 
civilly in state and federal court by prisoners challenging their 
criminal convictions or the terms of their confinement. 

The Bureau is comprised of 64 prosecutors and approximately 82 
support staff, including secretaries, paralegals, and financial 
investigators. In addition, a Massachusetts State Police unit 
consisting of 30 state troopers is assigned to the Bureau to 
investigate allegations of criminal wrongdoing across the state. 

The Criminal Bureau is organized among seven divisions: the 
Narcotics and Special Investigations Division, the Public 
Integrity Division, the Environmental Crimes Strike Force, the 
Medicaid Fraud Control Unit, the Appellate Division, the Economic 
Crimes Division, and the Fair Labor and Business Practices 
Division. These seven divisions of the Criminal Bureau are 
grouped generally by area of practice and type of crime 
prosecuted. The work of each of these divisions during fiscal 
year 1994 is described in the following pages. 

There were two major organizational changes in the Criminal 
Bureau in fiscal year 1994. First, the Narcotics and Organized 
Crime Division and the former Special Investigations Unit were 
merged into one division, in order to best utilize state police 
resources for those investigations which overlap each of those 
two related subject areas. Second, the Fair Labor and Business 
Practices Division was formed in October, 1993 following the 
statutory transfer to the Attorney General of many of the 
responsibilities of the Department of Labor and Industries. 

Many Assistant Attorneys General assigned to the Criminal 
Bureau practice in more than one division, although for 
management and supervision purposes they are assigned to one 
major area of responsibility. Each division is managed by a 
Division Chief, who both supervises the work of the attorneys and 
investigators assigned to that division and serves as senior 
prosecutor. The Bureau is lead by a Bureau Chief and Deputy 
Bureau Chief, who manage the work of the seven divisions and 
advise the Attorney General on law enforcement policy and anti- 
crime initiatives. 

In 1994, The Criminal Bureau spearheaded the Attorney 
General's Safe Neighborhood Initiative, a unique partnership of 
law enforcement and community leaders working together to bring 
peace to one of Dorchester's most violent neighborhoods. As part 
of this program, two Assistant Attorneys General have been 
assigned to the Suffolk County District Attorney's office to 
prosecute, on a community policing model, violent crimes and 



12 



narcotics offenses which occur in this defined urban area. Also 
as part of the Attorney General's urban violence strategy, an 
additional Criminal Bureau attorney serves as a Special Suffolk 
County Assistant District Attorney prosecuting gang-related cases 
in Suffolk County Superior Court, and four Assistant Attorneys 
General serve 4 month rotations in Dorchester, Roxbury, Brockton, 
and Lawrence District Courts. 

In addition to the regular litigation engaged in by the Bureau 
in each of the above-referenced areas. Assistant Attorneys 
General in the Criminal Bureau are sometimes called upon to 
prosecute those cases involving traditional violent crime 
(homicide, rape, armed robbery, etc.) which are referred to the 
Office of the Attorney General by the state's District Attorneys 
due to a conflict of interest on the part of the local 
prosecutor. In fiscal year 1994, the Criminal Bureau 
investigated and prosecuted 10 conflict cases referred by the 
District Attorneys. 

Finally, the attorneys of the Bureau are regularly called upon 
to render informal legal advice to police departments and to law 
enforcement officials across the state on criminal law matters. 
The Bureau is responsible for publishing quarterly a law 
enforcement newsletter to advise judges, police officers, and 
prosecutors on statutory and case-related developments in the 
area of criminal law. Finally, the Appellate Division of the 
Criminal Bureau periodically files amicus briefs in the United 
States Supreme Court, the Massachusetts Supreme Judicial Court, 
and the Massachusetts Appeals Court setting forth the position of 
the Attorney General, as the state's chief law enforcement 
officer, on important and novel criminal law issues. 

In almost every division of the Criminal Bureau in fiscal year 
1994, there were increases in the number of investigations 
initiated, the number of charges brought, the number of 
convictions secured after trial, the number of appellate briefs 
filed, and the amount of money recovered for the Commonwealth. 
The statistics which follow reflect not only the intense effort 
put forth by the Criminal Bureau attorneys, investigators, and 
support staff, but also the Bureau's commitment to making a 
difference for the citizens of Massachusetts in the areas of 
private and public sector fraud, elderly protection, health care, 
and urban violence. 



13 



APPELLATE DIVISION 

The Appellate Division handles a variety of criminal, federal 
habeas corpus, state habeas corpus and other civil cases which 
impact criminal prosecutions, and the criminal justice system 
itself. During the period from July 1, 1993 through June 30, 
1994, the following Assistant Attorneys General from both within 
and without the Division, handled Appellate Division cases: 
Elisabeth Medvedow, Neil Tassel, Bill Meade, Bill Duensing, Greg 
Massing, Ellyn Lazar, Bob Sikellis, LaDonna Hatton, Nancy Geary, 
Linda Nutting Murphy, Kris Guyot, Ed DeAngelo, Molly Parks, Carol 
Lee Rawn, Walter Sullivan and Pamela Hunt. 

The Division handled approximately 650 cases during the course 
of the year, which was about the same total number of cases as in 
FY 1993. Over 300 new cases were opened in FY 1993, an 11% 
decrease from the previous year, but which remains well above the 
number of cases opened in FY 1991 (161 cases) and FY 1992 (222 
cases). Two hundred and thirteen (213) cases were disposed. 

In addition to case work. Division Attorneys participate and 
present training programs for the Criminal Bureau, and consult 
with other Criminal Bureau attorneys on a variety of 
investigative, motion, trial, post conviction, and single justice 
matters. The Law Enforcement Newsletter is produced and edited 
in the Appellate Division. Additionally, Assistant Attorney 
General Neil Tassel participated in the Urban Violence program by 
spending four months prosecuting cases in Dorchester District 
Court . 

I. SUMMARY OF FY 1994 APPELLATE DIVISION CASE ACTIVITY 

A. Cases Handled 



A. 
B. 
C. 
D. 
E. 



Federal Habeas 

Federal Civil 

State Habeas 

State Civil 

211 § 3 and other 

Single Justice 

cases 

Criminal 

Other 



Cases 


Cases 


Total Cases 


Opened 


Disposed 
58 


Handled 


83 


158 


30 


18 


58 


43 


31 


84 


78 


62 


214 


18 


14 


28 


46 


26 


87 


9 
307 


4 
213 


12 
652 



The following is a comparison of case activity for the 
Appellate Division for the last several years: 

FY 1994 FY 1993 FY 1992 FY 1991 



TOTAL CASES OPENED 
TOTAL CASES DISPOSED 
TOTAL CASES HANDLED 




307 
213 
652 




351 
282 
649 


222 
206 
428 


161 
N/A 
N/A 








FY 1994 


FY 


1993 


FY 1992 




B. 


Appellate Briefs Fi 
By Court 


led 


54 




52 


56 






U.S. Supreme Court 
Court of Appeals 
(First Circuit) 
U.S. District Court 
(Bankruptcy Appeals 
SJC 
Appeals Court 


) 


2 

14 


14 
26 




4 
7 

2 

13 
26 


7 

10 



7 

32 






By Case Type 
















Criminal 
Federal Habeas 
Civil/State Habeas 




19 
13 
24 




20 

7 

25 


26 
11 
19 




C. 


Renditions: Governor's 


Warrants 


Reviewed 


- 199 




D. 


SAAG Supervision: 


Parole Board 











Treatment Center 



II. CASES HANDLED 



A. Federal Habeas Corpus 

During the course of the fiscal year, the Appellate Division 
carried a total of 158 habeas corpus cases. Eighty- three new 
cases were opened and 58 were disposed. The Commonwealth is only 
required to defend against petitions for which there is an order 
by the federal court to answer the petition. 

All but two cases decided during FY 1994 were successful, 
although we also pursued an appeal from an unfavorable decision 
issued last year. Appeals to the First Circuit Court of Appeals 
were taken in all cases in which the writ was ordered to issue; 
the cases were argued, and are currently under advisement. In 
one case we were successful in having the court deny habeas 
relief to William Gilday, who was convicted of the murder of a 
Boston police officer. 



B. Federal Civil Cases 

The Appellate Division handled 58 federal civil matters, which 
primarily involve civil rights actions brought against state 
judges, prosecutors, probation officers and other criminal 
justice system officials. Several cases involve representation 
of prosecutors who have been subpoenaed to testify or to produce 
their investigative or trial files. 

In Cameron v. Tomes there was an evidentiary hearing on a 
petition seeking to hold Treatment Center officials in contempt 
of a number of orders relating to treatment and conditions of 
confinement. The Division also represents District Attorneys in 
a number of actions including one case where plaintiff's decedent 
alleges that the District Attorney encouraged the media to 
identify plaintiff as a suspect in the Highway Serial Killer case 
which then led to plaintiff's suicide. In several matters we 
represent state prosecutors who have been subpoenaed as 
witnesses, or have intervened on behalf of state prosecutors to 
protect the integrity of ongoing state criminal proceedings. 

C . State Civil/Habeas Corpus Cases 

During FY 1994, the Appellate Division handled 84 state habeas 
corpus actions filed by prisoners seeking immediate release from 
confinement in such matters as attacks on commitments to the 
Treatment Center, challenges to the validity of Governor's 
warrants, and claims that probation or parole surrenders were 
invalid. The Appellate Division's civil case load (78 cases) 
includes appeals from denial of petitions for release filed by 
those committed to the Treatment Center under G.L. c. 123A, § 9, 
and appeals in all cases handled in the trial courts by agency 
counsel at the Parole Board as Special Assistant Attorneys 
General . 

The majority of state civil cases involve representation of 
prosecutors, and judges sued for their official actions, but in 
an increasing number of cases we have either intervened in civil 
cases on behalf of the Attorney General or District Attorneys or 
have moved for protective orders or to quash subpoenas served on 
prosecutors. In one case ( McNeil v. DuBois) we assisted the 
Department of Correction in obtaining a stay pending appeal of an 
order granting automatic earned good time credits to all 
prisoners who were in custody prior to trial, and then wrote an 
amicus brief on behalf of the Attorney General and the Parole 
Board seeking reversal of that order. 

Among the state habeas corpus cases was Kater v. Parole Board 
in which we argued that a parole violation detainer lodged in 
1978 against a murder defendant had never gone into effect, 
thereby preventing his release even after he posted bail prior to 
his third trial. There were also cases in which 

parole violators claimed the Board waived jurisdiction over them 
by not seeking their return to Massachusetts at an earlier time. 



16 



D. Criminal Cases 

While the majority of criminal cases handled by the Appellate 
Division are appeals from convictions in prosecutions by the 
Attorney General's Office, some cases have been referred by a 
District Attorney's Office because of conflict of interest 
( Nettis , Connolly ) , or which we agreed to handle on appeal 
( Pay ton ) . Additionally, the Commissioner of Probation has been 
represented in a number of cases where a former criminal 
defendant has sought expungement of court and probation records. 
There are also a number of cases in which those committed to the 
Treatment Center by the sentencing court have moved for release 
under Criminal Rule 30(a). In one criminal case a subpoena 
served by a criminal defendant on the Governor's office to 
produce all notes and information concerning the Governor's 
appointment of a judge was quashed. In another case, we 
successfully represented an Assistant District Attorney against 
whom a criminal contempt charge was sought. 

In the United States Supreme Court an opposition to a petition 
for certiorari in a drug trafficking case prevailed, and the 
Division wrote an amicus brief on behalf of the states in a case 
where the language of the " Webster " reasonable doubt instruction 
was being challenged. An unfavorable ruling by the Supreme Court 
could have had adverse consequences for all Massachusetts 
convictions . 

E. G.L. c. 211, § 3 and Other Single Justice Matters 

The Appellate Division successfully defended a case brought by 
the press seeking the names and addresses of seated jurors in a 
criminal case, and also defended a Superior Court order 
forbidding Court Television from broadcasting daily summaries of 
an ongoing murder case. In other cases, a District Court clerk 
was represented in an action brought by a criminal defendant 
seeking criminal process against the victim and others, and the 
constitutionality of the "gatekeeper" provisions of G.L. c. 278, 
§ 33E for murder cases was argued. 

Representing the Norfolk District Attorney's Office, the 
Division filed an action under G.L. c. 211, § 3 seeking reversal 
of an order that an Assistant District Attorney turn over his 
personal notes made after an interview with a victim in a rape 
case, to the parties in a civil case, and arguing that a District 
Attorney need not suffer a finding of contempt to obtain review 
of such an order. 

F. Other 

The Federal District Court ruled in our favor in two appeals 
we took from Bankruptcy Court rulings ordering stays of state 
criminal prosecutions for failure to pay wages. We also 
successfully argued to a California court that it could not 



17 



review the propriety of a Massachusetts conviction which was 
being used as an enhancement in a California prosecution. 

The Appellate Division was involved in filing an action in the 
Supreme Judicial Court under G.L. c. 211, § 4A, on behalf of the 
Governor and Attorney General to remove the Sheriff of Middlesex 
County (Weld v. McGonigle) . 



III. BRIEFS FILED 

The Appellate Division filed 54 briefs during FY 1994, in the 
United States Supreme Court (2); First Circuit Court of Appeals 
(14); Supreme Judicial Court (14) and Massachusetts Appeals Court 
(24) . Of these, 19 were in criminal matters, 13 in federal 
habeas corpus cases and 24 in various civil actions, SDP cases, 
or state habeas cases. 

An amicus brief was filed in the United States Supreme Court 
on behalf of the states in Sandoval v. California , (and Victor v. 
Nebraska ) , defending the constitutionality of the " Webster " 
instruction on reasonable doubt, and various formulations of 
reasonable doubt instructions given in other states' criminal 
cases . 

Briefs filed in the United States Court of Appeals in federal 
habeas corpus cases doubled the number written last year. In 
three cases, appeals were taken from District Court orders 
granting writs of habeas corpus: Scarpa involved a claim of 
ineffective assistance of counsel in a cocaine trafficking case; 
Stewart alleged insufficiency of evidence in a murder case; and 
Beauchamp concerned whether a murderer who escaped from prison 
would be given credit for time spent fighting extradition after 
he was captured out of state. All three cases are under 
advisement. All First Circuit cases which have been decided were 
successful, including Libby which challenged a presumed malice 
instruction in a 1971 trial; Sabetti, in which the Court found 
the state drug trafficking statute constitutional; and Ortiz , 
upholding a conviction for the murders of two Springfield police 
officers . 

This year a number of briefs were filed in the Supreme 
Judicial Court, including two important cases concerning sexually 
dangerous persons ( Redgate ) ( Gagnon ) ; a public records case 
involving homicide and police internal affairs investigative 
materials ( Globe ) ; a criminal case which raises the issue whether 
there is any authority to order "expungement" of court and 
probation records where the legislature has provided only for 
sealing (Balboni) ; and a civil case which held that police 
officers are not liable under the Tort Claims Act for their 
decisions in deciding how to investigate crimes and when to 
arrest or seek criminal process (Sena) . 



The Appellate Division's amicus efforts in the SJC this year 
included a brief addressing the question whether defendants are 
entitled to attorneys fees for opposing the Commonwealth's 
efforts to appeal the allowance of a new trial in murder cases 
(Latimore) , and a brief filed on behalf of the Attorney General 
and the Parole Board challenging a Superior Court injunction that 
ordered the automatic granting of "earned" good time credits to 
all state prisoners who spent time in custody prior to their 
convictions ( McNeil ) . In both cases, the Court adopted the 
arguments we made. The office also responded to the Court's 
request for comments on the proposed One-Trial Rules for the 
District Courts, and argued the matter before the full court. 

The Division wrote twenty- four briefs in the Appeals Court, 
involving a number of criminal cases prosecuted by the Criminal 
Bureau, including narcotics cases, criminal contempt, and tax 
evasion. In a prosecution of a police officer for operating 
under the influence and causing serious bodily injury, an appeal 
of the lower court's dismissal of the charges was successful. 
( Connolly ) . There also were a number of appeals in cases 
ordering the continued commitment of sexually dangerous persons, 
and in civil cases in which prisoners challenged the authority of 
the Parole Board to violate their parole. We were unsuccessful 
in three cases. In two of those, further appellate review was 
obtained, one of which, concerning peremptory challenges, is 
currently scheduled for argument in the SJC. In the other, the 
SJC declined to reverse its recent decision addressing the 
unconstitutionality of committing certain individuals to the 
Treatment Center. 



IV. RENDITIONS 

Attorneys from the Criminal Bureau, at the request of the 
Governor's office, review the legal sufficiency of applications 
for Governor's warrants, both at the request of other states and 
by Massachusetts District Attorneys, and Department of Correction 
and Parole Officials. From July 1, 1993 through June 30, 1994, 
199 different cases were reviewed. Whenever a person arrested on 
a Governor's warrant challenges the validity of the warrant. 
Criminal Bureau attorneys handle the habeas corpus cases in the 
trial and appellate courts. 



19 



V. OTHER ACTIVITIES 

• Assistant Attorney General Pamela Hunt was appointed by the 
Governor to the Massachusetts Sentencing Commission. 

• Division attorneys sat as hearing officers for the Board of 
Appeals of the Registry of Motor Vehicles. 

• Assistant Attorney General Hunt sits as the Attorney General's 
representative on the Criminal History Systems Board. 

• Assistant Attorney General Hunt is a member of the Supreme 
Judicial Court's Standing Advisory Committee on the Criminal 
Rules . 

• Assistant Attorneys General Hatton and Hunt participated in 
Chief Justice Zoll's Committee on One-Trial Rules. 

• Assistant Attorney General Hunt was a member of Chief Justice 
Steadman's committee on ADR for prisoner cases. 

• The Division provides information to the Parole Board relevant 
to its consideration of pardon and commutation matters and for 
parole decisions in second degree murder cases. 

• Assistant Attorneys General Hatton and Hunt worked with Chief 
Justices Fenton, Zoll and Tierney concerning the implementation 
of Jenkins , which requires a system by which individuals 
arrested without a warrant are to be given a probable cause 
determination within 24 hours of arrest. 

• Assistant Attorney General Hunt is a member of the Supreme 
Judicial Court's Advisory Committee on Use of Electronic Copies 
of Transcripts . 

• Assistant Attorney General Hunt worked with South Shore Elder 
Services, elder service groups, and police from Hingham, Hull 
and Cohasset on an intergenerational project designed to 
protect elders living alone from violence and fraud, and 
assisted South Shore Elder Services in gaining CORI access to 
conviction data of home service providers. 

• The Appellate Division attorneys periodically meet with the 
Governor's legal office staff in matters relating to Governor's 
warrants and extradition, various parole and corrections 
matters, and the impact of pending criminal justice legislative 
efforts . 



20 



VI. SPECIAL ASSISTANT ATTORNEYS GENERAL SUPERVISION 

A. Parole Board 

Agency counsel at the Parole Board are designated to handle a 
number of cases in the state trial courts. Appellate Division 
attorneys work closely with Board counsel in the defense of these 
matters, and handle all appeals in these cases. The Appellate 
Division is also involved in the many Parole Board cases which 
require coordination with the Department of Correction. 
Assistant Attorneys General from the Appellate Division and the 
Government Bureau defend all cases concerning the Parole Board in 
federal court. 

During FY 1994, 60 new cases were referred to the Parole 
Board. Agency counsel disposed of 37 cases during that period. 

B. Department of Mental Health 

Counsel in DMH are currently designated to handle all SDP § 9 
hearings in the Superior Court. Assistant Attorneys General in 
the Appellate Division handle all appeals in these cases and are 
involved in supervision and monitoring of the Superior Court 
hearings . 

During the past year the Appellate Division was involved in a 
working group and in meetings with the Chief Justice of the 
Superior Court, Governor's Legal Counsel, the First Assistant and 
the Department of Mental Health addressing a number of issues 
surrounding the scheduling and conduct of § 9 hearings. 



21 



NARCOTICS AND SPECIAL INVESTIGATIONS DIVISION 

During fiscal year 1993-1994, the Narcotics and Organized 
Crime Division and Special Investigations Division were 
consolidated. The role of the consolidated Narcotics and Special 
Investigations Division continues to focus on complex criminal 
enterprises with an expanded concentration on violent organized 
criminals dealing in narcotics and firearms. During fiscal year 
1993-1994, the division handled a number of cases which were 
initiated by State Police assigned to the division as well as 
cases referred from local, state and federal law enforcement 
agencies. In addition, attorneys and investigators from the 
division have participated in a number of joint/task force 
investigations with local, state and federal agencies including 
the Federal Bureau of Investigation, Bureau of Alcohol Tobacco 
and Firearms, United States Postal Inspection Service, United 
States Secret Service, Internal Revenue Service and New Hampshire 
State Police along with United States Attorney's offices in 
Massachusetts, New Hampshire and Rhode Island and state 
prosecutor's offices in New Hampshire. 

INVESTIGATIVE ACTIVITY 



Investigations initiated 
Individuals arrested 
Defendants indicted 
SEIZURES 



118 

126 

99 



Cocaine 

Heroin 

Marijuana 

Pharmaceuticals 

Firearms 



U.S. Currency 
Vehicles 
Stolen Property 



32.9 lbs/526.4 oz 
21. 08 oz 

6.8 lbs/110 oz 
over 15,000 tablets 
16 handguns 

4 rifles/shotguns 

2 assault weapons /machine guns 
$100,931.00 
31 

29 Oriental rugs. Recovered 
jewelry, silverware and 
antiques valued at over 
$200, 000. 



22 



PROSECUTIONS 

Criminal 

Pre Trial 71 

After Trial 18 

TOTAL 89 

Convictions 82 

Not Guilty 7 

Dismissal 9 

TOTAL 9 8 

Drug Related forfeiture 
Actions Filed in Superior Court 

TOTAL 15 
Forfeiture Judgments 

U.S. Currency Forfeited $101,205.00 

Vehicles Forfeited 5 

Other Civil Forfeitures/Fines: 

Commonwealth of Massachusetts 

V. 

AETNA Capital Management Inc. 

AETNA Financial Services Inc. 

Fine/Penalty $500,000.00 
Restitution 3.6 Million 



SIGNIFICANT ACHIEVEMENTS 

Narcotics 

The continued focus of the division during the past fiscal 
year on organized narcotics distribution rings has resulted in a 
number of multi-defendant cases which have been successfully 
prosecuted. Many of those cases were the result of long term 
undercover investigations in which suspects distributed drugs to 
undercover officers. In an increasing number of those cases, 
undercover officers and surveillance officers have successfully 
identified others associated with that illegal operation and 
related criminal activities. In early 1994 three ringleaders of 
a cocaine and marijuana distribution organization plead guilty 
along with seven of their associates. As part of that case, 
indictments alleging filing false state income tax charges were 
brought against the primary distributor in that organization 
along with a civil forfeiture action for the defendant's real 
property. 



Firearms /violent Crimes 

Thirteen defendants were apprehended and charged with 
illegally possessing and /or selling firearms. In one case, a 
suspect sold five firearms to an undercover officer including a 
Tec-9 machine gun/assault weapon. That suspect was arrested, 
convicted and is serving a state prison sentence. In another 
case, a suspect sold a handgun with a defaced serial number to an 
undercover officer in addition to quantities of cocaine and 
marijuana. That suspect was also arrested, convicted and is 
serving a state prison sentence. With increasing frequency, 
narcotics dealers are found to be armed with handguns when 
apprehended . 

Inmate Crimes 

In two separate cases, inmates serving sentences were charged 
with crimes which they committed while incarcerated. An inmate 
serving a sentence in state prison along with four accomplices 
were indicted for an alleged larceny scheme in which the inmate 
used stolen credit card account numbers to order clothing, 
computers and electronic equipment from retail stores by 
telephone for shipment to his accomplices who received those 
items at their residences. Those cases are pending in Superior 
Court. In another case, an inmate serving a sentence in a county 
House of Correction allegedly solicited an undercover agent to 
murder his former girlfriend in return for a cash payment. That 
case is also pending in superior Court. 

Arson/Property Crimes 

Ongoing cooperative efforts with the Federal Bureau of 
Alcohol, Tobacco and Firearms and State Fire Marshall's Office 
resulted in the indictment of eleven defendants in five separate 
cases for arson and related crimes during the past fiscal year. 
All of those cases are currently pending in Superior Court. In 
addition, attorneys and investigators from the division 
participated in a burglary task force with New Hampshire 
prosecutors and New Hampshire State Police to solve a series of 
home burglaries in New Hampshire and Massachusetts which resulted 
in the recovery of over $200,000 in stolen oriental rugs, jewelry 
and silverware and the indictment of the suspected ringleaders. 
Those cases were pending at the close of the fiscal year. 

Mail Thefts/Check Cashing Ring 

A joint investigation with the United States Postal Service 
resulted in the indictment of eleven defendants alleged to have 
been participants in a highly organized ring which utilized 
names, addresses and other identifying information from 
unsuspecting victims obtained from a series of mailbox 
burglaries. After obtaining that information, the defendants are 
alleged to have obtained false ID'S in the names of those 
victims to cash stolen checks which the defendants forged and 



24 



cashed at area banks in the greater Boston area. Those cases 
were pending at the end of the fiscal year. 

Organized Crime 

During the past fiscal year, 29 defendants charged with a 
variety of illegal gaming and loansharking indictments plead 
guilty in Superior Court. Those indictments were based upon a 
joint investigation conducted by the division together with the 
Middlesex District Attorney's Office, State Police, Lowell and 
Wilmington Police during 1991 which utilized court authorized 
wiretaps. Sentences imposed ranged from committed state prison 
and house of correction sentences for the ringleaders to 
suspended sentences and probation for the soldiers in that 
organization over $75,000 in fines were imposed together with 
over $40,000 in costs in connection with those sentences. Three 
cases remain pending in Superior Court involving both gaming and 
cocaine trafficking charges. 

Public Pension Investigation 

In August 1993, a two year investigation by attorneys and 
investigators from the division in conjunction with the United 
States Attorney's Office in Boston, Massachusetts Securities 
Division and Federal Securities and Exchange Commission resulted 
in civil enforcement actions by each agency against AETNA Capital 
Management Inc. and AETNA Financial Services Inc. Those 
enforcement actions arose out of fraudulent activities by those 
firms in connection with payments to Carmen Elio, Robert Mongillo 
and an insurance firm owned by then Senator William Q. MacLean. 
In settling those enforcement actions, AETNA Capital Management 
Inc. and AETNA Financial services Inc. paid additional 
restitution of $3.6 million to 21 Massachusetts Public Employee 
Retirement Boards and paid a total of $1.5 million in penalties 
of which $500,000 was paid to the Commonwealth of Massachusetts. 

Also in August 1993, Carmen Elio and State Senator Henri 
Rauschenbach were indicted for alleged violations of the state 
conflict of interest law in connection with Elio's payments to 
Rauschenbach during 1991 in return for Rauschenbach ' s assistance 
in presenting various investment and business proposals to state 
officials. That case is pending in Superior Court. 

Drug Related Forfeitures 

In the spring of 1994, as part of the forfeiture unit's 
continued efforts in "Operation Take Back" to identify and 
forfeit properties in which repeated drug violations have 
occurred, the division filed a civil forfeiture action in 
conjunction with the Middlesex District Attorney's Office seeking 
forfeiture of a Lowell bar located in the Acre section of that 
city. After a long history of drug violations by bar patrons and 
drug related crimes. State Police assigned to the division 
conducted a series of undercover drug purchases inside that 



25 



establishment which resulted in a number of arrests and criminal 
charges. In addition to seeking forfeiture of that property 
under the drug forfeiture law, the state public nuisance law 
(G.L. 139 S.16A) was utilized as an additional basis for the 
closing of that establishment by seeking an injunction against 
the operators of that establishment to prohibit continued illegal 
drug dealing in and around the premises. That civil action along 
with a number of others involving real property were pending in 
superior court at the end of the fiscal year. 



26 



URBAN VIOLENCE STRIKE FORCE 

The Urban Violence Strike Force was organized in the spring of 
1991 as part of Attorney General Scott Harshbarger ' s overall 
commitment to improving the quality of life for residents of the 
Commonwealth's urban communities. 

During fiscal year 1994, the Attorney General continued his 
strong emphasis on combating urban violence. Indeed, the legal 
resources devoted to this effort within the Attorney General's 
office has been unprecedented in the history of this office. 
During this past fiscal year, three prosecutors from the Criminal 
Bureau and four Assistant Attorneys General from other bureaus in 
the office have been dedicated full-time to urban violence 
prosecution efforts. 

The urban violence initiatives under the auspices of the 
Criminal Bureau are described below: 

GANG UNIT INITIATIVE 

During fiscal year 1994, the Criminal Bureau continued to 
devote resources to the Gang Unit in the Suffolk County District 
Attorney's Office. The Gang Unit's goal is to conduct priority 
prosecution of youthful offenders charged with violent crimes 
arising out of gang related activity, with a particular emphasis 
on crimes involving the distribution of drugs and/or the use of 
firearms. The Gang Unit works with the Boston Police Department 
Anti-Gang Violence Unit as well as with uniformed officers and 
detectives assigned to various police districts. In 1994, the 
Assistant Attorney General assigned to the Gang Unit handled over 
fifty Superior Court matters representing a variety of serious 
offenses, including armed assault with intent to murder, armed 
assault in a dwelling, armed robbery, dangerous weapon offenses, 
kidnapping and distribution of drugs. As a result of direct 
indictments and aggressive prosecution of these youthful 
offenders, our Assistant Attorney General disposed of over thirty 
cases by guilty pleas or findings of guilt after trial, and 
secured the incarceration of a number of major violators which 
has made a contribution to the reduction of gang related violence 
in Boston. 

SAFE NEIGHBORHOOD INITIATIVE 

The Safe Neighborhood Initiative (SNI) is the outgrowth of a 
three-year partnership between the offices of the Attorney 
General and the Suffolk County District Attorney. In February 
1991, the Attorney General assigned three full-time Assistant 
Attorneys General to work with the Suffolk County District 
Attorney's Office prosecuting major violent felonies and gang- 
related offenses. This unit of attorneys was responsible for 
prosecuting hundreds of cases directly resulting from urban 
violence . 



While this contribution to existing prosecution efforts and 
infusion of additional resources were helpful, both Attorney 
General Scott Harshbarger and District Attorney Ralph Martin 
agreed that the problems facing our urban neighborhoods demand a 
comprehensive, multidisciplinary approach, namely, a 
collaborative effort between law enforcement (police, 
prosecution, the courts, probation, youth services), human 
services and the community to effectively deal with escalating 
violence and fear that threaten the quality of life in Boston's 
neighborhoods . 

To accomplish these ends, on February 22, 1993, the SNI was 
formed as a pioneering partnership among community residents, the 
Attorney General's Office, the District Attorney for Suffolk 
County, the Boston Police Department and the Mayor's Office of 
Neighborhood Services. 

The overall mission of the SNI is to bring law enforcement and 
community organizations together in a coordinated way that will 
assist in revitalizing a neighborhood plagued by a variety of 
societal problems. 

The SNI brings increased law enforcement and prosecutorial 
efforts to a designated geographical area. The target area 
designated for this project consists of the residential and 
business areas of Fields Corner, Bowdoin Street, Four Corners and 
Geneva Avenue in Dorchester. This area was chosen as the target 
area for the SNI based on the high incidence of urban crime 
(gang-related violence and drug distribution) , the intensive 
concentration of investigative and prosecution efforts within one 
police district and district court, as well as the level of 
existing community-based programs and neighborhood crime watch 
groups. By concentrating on one geographical area, the SNI has 
demonstrated the tangible results achieved when residents, law 
enforcement and hixman service representatives join together to 
free a neighborhood from violence's iron grip and improve the 
quality of life for all. 

In 1994, the SNI unit screened over 1300 cases, ranging from 
misdemeanors to major violent felonies, and accepted 
approximately 127 cases for prosecution. Over 35 of the most 
serious cases were directly indicted in Superior Court and have 
resulted in a substantial number of convictions and the 
imposition of lengthy prison terms. Approximately 90 cases were 
handled by the unit in Dorchester District Court, with many 
committed sentences being imposed. During the year, the SNI unit 
provided assistance to a number of law enforcement agencies, 
including the Immigration and Naturalization Service in 
immigration and deportation proceedings in Dorchester District 
Court. 

The Safe Neighborhood Initiative Unit also worked with local 
community development groups, private institutions, and state and 
local representatives to target abandoned property within the 



28 



area for rehabilitation and re-sale. As part of the Safe 
Neighborhood Initiative, the Attorney General's Office worked 
with the Boston Police and telephone companies to remove pay 
telephones that have been used as a haven for drug and gang 
activity within the target area, and has worked with local 
communication companies to remove billboards that depict 
violence. The Attorney General's Office worked closely with the 
Safe Neighborhood Initiative Advisory Council and coitmunity 
groups, including business groups and crime watch groups, to 
address criminal activity and other community issues. This 
office's Student Conflict Resolution Experts (SCORE) program has 
been implemented in the Grover Cleveland Middle School in the 
target area and in Dorchester High School. 

Recently, the Attorney General's Office was awarded a 
$382,972.00 grant by the Massachusetts Committee on Criminal 
Justice. This grant will enable the SNI participants and 
community residents to expand the project in three core areas of 
crime prevention and reduction. Specifically, the funding for 
the SNI is for; 1. Coordinated Law Enforcement which will allow 
expanded police presence and surveillance and expanded 
prosecution efforts; 2. Neighborhood Revitalization efforts 
including the funding of "This Neighborhood Means Business!", an 
innovative education program for small business owners; and 3. 
Violence Prevention and Treatment including a number of programs 
designed to help prevent crime and violence from occurring in the 
target area. 



29 



URBAN COURT STRIKE FORCE 

The Urban Court Strike Force is a four month rotation program 
which affords Assistant Attorneys General an opportunity to 
prosecute cases in urban district courts. During FY 1994, 
sixteen AAG ' s participated in rotations in Brockton, Lawrence, 
Roxbury and Dorchester District Courts. The contribution to 
existing prosecution efforts has been extremely helpful to the 
District Attorney's Offices and the program has served as an 
invaluable learning tool for the AAGs who have participated. 
During this fiscal year, the Urban Court Strike Force rotation 
lawyers were responsible for prosecuting hundreds of cases 
directly resulting from urban violence. 

The Criminal Bureau Assistant Attorneys General who were 
assigned to these urban violence initiatives during fiscal year 
1994 are Paul McLaughlin, Marcia Jackson, Linda Sable, Abbe Ross, 
Carol Lee Rawn, Neil Tassel, Glen MacKinlay, Patricia Preziosa 
and Elisabeth DiTomassi. 

In 1994, members of the Criminal Bureau also provided 
assistance in other criminal justice/urban violence related 
projects. Members of the Bureau assisted Attorney General Scott 
Harshbarger who co-chairs the Criminal Justice/Law Enforcement 
Task Force of the Boston Coalition, a coalition of law 
enforcement, criminal justice, substance treatment, religious and 
business leaders. As a result of this collaboration and with the 
infusion of a recently received grant, the Boston Coalition will 
now move forward on its proposal to create a drug diversion court 
for drug and alcohol addicted offenders in our urban communities. 
Members of the Criminal Bureau also assisted Attorney General 
Harshbarger, who co-chaired with Governor William Weld and 
Lieutenant Governor Paul Cellucci a series of Urban violence 
Summits, whose goal is to find ways to improve coordination, 
communication and performance throughout our criminal justice 
system. A number of successes were achieved as a result of these 
summit meetings including making significant progress in the area 
of default warrant management. Also, as a result of the 
dedicated work of the legislative sub-committee of the Summit, a 
comprehensive legislative proposal has been filed which upon 
passage will establish an electronically-based warrant management 
system in our criminal justice system. 



ENVIRONMENTAL STRIKE FORCE 

I. SETTING A NEW BENCHMARK IN 
CRIMINAL ENVIRONMENTAL ENFORCEMENT 

The Massachusetts Environmental Strike Force continued to 
perforin as a relatively unique enforcement tool for the 
investigation and prosecution of environmental crimes in 
Massachusetts. The Strike Force continued its activities through 
the cooperative efforts of the Attorney General, Secretary of 
Environmental Affairs, Department of Environmental Protection, 
Environmental Police, and State Police. The Strike Force unit 
operating out of the Criminal Bureau of the Attorney General's 
Office included four criminal prosecutors, five environmental 
police officers, one state police officer, one civil 
investigator, and one support staff person. In addition, the 
Strike Force's emphasis on coordination with other government 
agencies resulted in significant case contributions by the 
Department of Labor and Industries, the Division of Occupational 
Hygiene, the Massachusetts Water Resources Authority, and others. 

In Fiscal Year 1994, the criminal Strike Force cases resulted 
in significant and creative dispositions designed to promote 
environmental protection throughout the commonwealth. In one 
case, a state record $500,000 was paid by a defendant to create a 
new fund, administered by faculty at the University of 
Massachusetts at Lowell, to improve work environments across the 
state. In another case, a defendant was ordered to pay for the 
placement of an advertisement in a widely distributed furniture 
manufacturers' trade journal, to make the point that improper 
handling of hazardous waste can result in criminal prosecution. 
In a third case, a Superior Court judge agreed with the 
Commonwealth that the operator of an illegal tire dump in western 
Massachusetts had failed to implement measures which would 
protect public safety and the environment, and sent the defendant 
to jail under an eighteen month sentence, a record under the 
state's Solid Waste Management Act. These and other cases served 
to set a new benchmark in criminal environmental enforcement in 
Massachusetts . 

II. CRIMINAL CASES 

Com. V. Bay State Smelting Co., Inc., Gerald Sack, and David 
Traister: This Somerville smelting company, its president, and 
its plant manager all pled guilty to indictments charging storage 
of hazardous waste in a manner which could endanger human health, 
and in a manner which violated Department of Environmental 
Protection regulations. A two year investigation, prompted by a 
report of the state's Division of Occupational Hygiene, revealed 
that toxic lead dust was released by the company into its plant 
because of inadequate and poorly maintained ventilation and 
illegal and improper work practices. Bay State's sentence 
included payment of $500,000 for the creation of the Work 
Environment Justice Fund, and a special condition of probation 



31 



requiring the company to remain in compliance with the judgment 
entered in a parallel civil case brought by the state against the 
company. The Fund, to be administered by faculty of the Work 
Environment Program of the University of Massachusetts at Lowell, 
will promote education, prevention and advocacy efforts in the 
area of workplace health and safety. Each of the individual 
defendants was sentenced to 750 hours of alternative punishment, 
to be completed during their one year terms of probation. The 
civil judgment required the company to quickly correct existing 
violations, maintain facility cleanliness, and pay substantial 
stipulated penalties if it fails to do so. 

Com, v. Salvatore Benanti and Eric Schaeffer: 

Each of these defendants pled guilty to multiple indictments 
charging illegal disposal of solid waste. In addition, 
Schaeffer was convicted of larceny, leasing with intent to 
defraud, and wanton injury of property. The convictions 
completed the Strike Force's successful prosecution of several 
individuals who represented themselves as being in the tire 
recycling business while dumping thousands of junk tires on 
private properties in a half-dozen Boston area communities. 
Benanti was sentenced to 2 years probation, 2,000 hours of 
community service, and ordered to make $100,000 in restitution. 
Schaeffer was ordered to pay a $10,000 fine over a three year 
period of probation. 

Com. V. BENU Corp. and Larry S. Franggs : 

Grand juries in Worcester and Middlesex counties returned 
indictments against this Ohio corporation and its president for 
illegal transportation of hazardous waste in connection with a 
state contract to repaint highway bridges. The contract required 
BENU to sandblast the old paint off of the bridges, and to 
arrange for transportation of the lead contaminated sandblast 
waste by a licensed hauler. BENU was found guilty in both 
counties, and a total of $300,000 in fines were imposed. The 
charges against Frangos, which also include forgery in 
connection with the creation of an allegedly false hazardous 
waste manifest, are pending. 

Com. V. David Cosentino and Paul Kinzer : 

A Worcester County Grand Jury returned indictments against 
Cosentino for illegally giving hazardous waste to an unlicensed 
person, failure to use a hazardous waste manifest while shipping 
hazardous waste, and disposing of hazardous waste in a manner 
which could endanger human health, safety or the environment. 
Defendant Kinzer was charged with transporting hazardous waste 
without a license and without a manifest, and disposing of 
hazardous waste in a manner which could endanger human health, 
safety or the environment. The indictments arise from the 
alleged dumping of ten 55-gallon drums of hazardous waste on two 
open lots in Gardner. These cases are pending. 



32 



Com V. Paul Goldman and Plycraft Corporation: 

This former Lawrence furniture manufacturing company and its 
president were each found guilty on multiple counts charging 
storage of hazardous waste in a manner which could endanger human 
health, safety or welfare, or the environment, and in a manner 
inconsistent with Massachusetts hazardous waste management 
regulations. The charges stemmed from Department of 
Environmental Protection inspections at the Plycraft site during 
which drums of hazardous waste were observed near open flame 
heaters. Some drums were in poor condition, not stored in 
designated areas, not labeled, and without proper U.S. EPA 
identification numbers. Goldman was ordered to pay for a $4,300 
full-page advertisement in a national furniture trade journal, 
advising other manufacturers of the criminal liability for 
hazardous waste violations, and encouraging them to comply with 
hazardous waste laws. Goldman was also fined $15,000, to be paid 
over a 2-1/2 year probationary period. 

Com. V. Gordon Realty Corp. of Worcester: 

This Worcester real estate development company pled guilty to 
the illegal transfer of hazardous waste to an unlicensed 
transporter, and was ordered to pay a $15,000 fine. 

Com. V. Roger Knowles and Polymer ine, Ltd. : 

This New Bedford circuit board manufacturer and its president 
each pled guilty to indictments charging storage of hazardous 
waste in a manner which could endanger hiiman health, safety, 
welfare, or the environment and in a manner inconsistent with 
Massachusetts hazardous waste regulations; and transferring 
hazardous waste to an unlicensed person. The charges stemmed 
from a sting operation in which Knowles paid undercover Strike 
Force agents, posing as an unlicensed waste disposal company 
named "Three Guys Disposal", to dispose of four drums containing 
hazardous waste. A subsequent surveillance of the plant revealed 
evidence of illegal hazardous waste storage. Polymerine was 
ordered to pay $400,000 in fines. Knowles was fined $10,000 and 
placed on two years probation. 

Com. V. Krisco Corn. & Kris Ogonowsky: 

A Middlesex County Grand Jury indicted this Somerville auto 
body shop and its vice president and manager for transferring 
hazardous waste to an unlicensed person, transfer of hazardous 
waste without a manifest, and attempted illegal transfer of 
hazardous waste. The charges stemmed from the alleged dumping of 
partially- full cans of solvent-based paints into a trash dumpster 
which was designed to receive only non-hazardous rubbish and 
garbage. These cases are pending. 

Com. V. Albert D. Parker: 



On application by the Strike Force, the Peabody District Court 
issued a complaint charging this defendant with illegal storage 
of a special waste (asbestos) . The complaint arose from the 
alleged abandonment of about 725 bags of asbestos waste at a 
self-storage facility in Lynnfield. This case is pending. 



33 



Com. V. Bernard Pemstein & Darryl Saad: 

Pemstein, a Worcester commercial property owner, pled guilty 
to three counts of violating state air pollution laws and one 
count of attempting to illegally dispose of asbestos waste. 
Defendant Saad, an Oxford contractor retained by Pemstein, pled 
guilty to five counts of violating state labor and industry 
regulations designed to protect worker safety at an asbestos 
removal site. The charges arose from an illegal asbestos removal 
operation conducted at a Worcester property owned by Pemstein. 
Pemstein was fined $30,000 and placed on 90 days probation. Saad 
was fined $1,000 and also placed on 90 days probation. 

Com. V. Carl Trant : 



Acting on the Commonwealth's motion, the Hampden Superior 
Court vacated its stay of its previously imposed jail sentence 
for this defendant convicted on multiple indictments charging 
solid waste, air pollution, and hazardous materials violations in 
connection with the maintenance of a Brimfield tire dump. The 
Court acted after a series of hearings during which the 
Commonwealth established that, contrary to the terms of the stay, 
the defendant had failed to implement measures which would 
eliminate tire fire concerns at the site. For violating the 
Massachusetts solid waste management statute, the defendant was 
sentenced to two years in the House of Correction, 18 months to 
serve, the balance suspended for two years. For violating the 
air pollution control act, the defendant was sentenced to one 
year in the House of Correction, to be served concurrently with 
the solid waste sentence; for violating the oil and Hazardous 
Material Release Prevention Act, the defendant was sentenced to 
two years on and after the solid waste sentence, suspended for 
two years . 

III. NON-CRIMINAL DISPOSITIONS 

In addition to the criminal matters handled by the 
Environmental Strike Force, several matters were resolved through 
creative civil settlements negotiated as a result of resources 
devoted by the Strike Force's criminal prosecutors. 

Com . V . AT&T : 



A civil complaint was filed alleging violations of the state's 
Clean Water Act and the Oil and Hazardous Material Release 
Prevention and Response Act. The violations related to AT&T's 
alleged discharge of water, contaminated with hexavalent 
chromium, into the Merrimack River from its plant in North 
Andover. The release occurred when there was an accidental break 
in the plant's fire sprinkler system. AT&T agreed to pay a 
$75,000 penalty, to conduct regular training programs for 
employees who respond to spills at the plant, and to designate 
individuals who will be responsible for reporting such spills to 
the Department of Environmental Protection. AT&T also 
voluntarily implemented changes at the plant, at a cost of over 



34 



$900,000, which eliminated hexavalent chromium from the sprinkler 
system. 

Com. V. Bertram Paley: 

In a civil action against this Lawrence real estate developer 
and commercial landlord, the defendant agreed to pay $139,786 in 
civil and administrative penalties in connection with alleged 
illegal handling of asbestos. The defendant also agreed to 
remove damaged asbestos from his commercial complex, file and 
asbestos operations and maintenance plan with the state, report 
on employee training, and post warning signs during construction 
and renovation activities. 

Com. V. Winfield Brooks: 

A civil action was filed alleging violations of the Clean 
Waters Act by this Woburn chemical manufacturer. The violations 
related to the alleged discharges to the sewer of wastewater 
containing pollutants in excess of MWRA permit limits. The 
defendant agreed to pay $75,000 in penalties, to cease 
discharging industrial wastewater to the public sewer system, and 
to appoint a vice president to the position of environmental 
compliance officer to oversee compliance with environmental 
requirements . 

IV. WORKING FOR SYSTEMIC IMPROVEMENTS 

Recognizing the systemic issues highlighted by the above 
cases, the Attorney General continued to propose legislative 
changes which would improve the Commonwealth's capacity to 
respond to environmental problems. One such bill, "An act 
relative to the abatement of scrap tire stockpiles and the proper 
management of scrap tire generation, " addresses the 
Commonwealth's immediate scrap tire stockpile problem by 
promoting abatement projects. The bill would also prevent future 
environmental threats by stimulating private tire recycling 
efforts. In recognition of the personal health threats posed to 
workers and other individuals by company practices which may 
result in injurious exposures to hazardous materials, the 
Attorney General filed legislation to increase fines against 
organizations found guilty of manslaughter or assault and 
battery. 

In addition, the Attorney General co-sponsored the re-filed 
"Conscientious Employee Protection Act". A portion of the Act 
protecting public employees, became law during the past year. 
The Attorney General seeks to have similar protections extended 
to those who work in the private sector and who cooperate with 
law enforcement in the investigation of job-related legal 
violation, including environmental violations. The Attorney 
General also co-sponsored the re-filed Environmental Trust Fund 
and Forfeiture Act, Environmental Endangerment Act and a bill to 
strengthen and harmonize existing environmental enforcement 
provisions . 



CRIMINAL INVESTIGATIONS DIVISION 

The Criminal Investigations Division continues to provide the 
Criminal Bureau with an experienced group of investigators to 
carry on Criminal Bureau investigations. The police and civilian 
investigators assigned to this division provide a wealth of 
expertise and experience in matters such as organized crime, 
narcotics trafficking, public corruption, money laundering, 
securities violations, tax fraud, crimes against the elderly, and 
environmental crime. 

The State Police Unit assigned to the Criminal Bureau is 
commanded by Lieutenant John Kelly, Sergeants Andrew Palombo and 
Thomas Quigley (Narcotics and Special Investigations Unit), 
Sergeant Robert Friend (Public Integrity/Economic Crime) , and 
Sergeant Brian Kennedy (Springfield Office) . Lieutenant Gail 
Larson of the Environmental Police supervises environmental 
investigations. Eight civilian investigators continue to provide 
expertise in financial investigations. 

The hallmark of the division continues to be the assistance 
given to other agencies and municipalities, and joint 
investigations carried on with many federal, state, and local law 
enforcement agencies and police departments. Significant among 
these investigations are the following: 

The Public Corruption Unit responded to complaints made by 
members of the Mansfield Police Department regarding 
misappropriation of town funds by the police chief. A lengthy 
investigation led to the indictment of the chief and his 
subsequent removal from the department . 

The Organized Crime and Narcotics Unit developed information 
that a Webster police officer was trafficking in narcotics in 
Western Massachusetts. Undercover investigators working with 
investigators from the Worcester County District Attorney's 
Office were able to purchase narcotics from the police officer . 
and subsequently arrest him for trafficking. 

The Special Investigations Unit continued to coordinate many 
multi- jurisdictional investigations with various municipalities 
that do not have the resources or expertise to manage complex 
criminal investigations. 



36 



During FY 94, the Criminal Investigations Division 
accomplished the following: 

Investigations 160 

Arrests 157 

Search Warrants 66 

Stolen Property Seized $500,000 
Background Investigations 210 
Assists to Other Agencies 350 

Drug Money Seized $100,931 
Vehicles Seized 31 

Firearms Seized 22 

Heroin 218 ounces 

Cocaine 32.9 lbs. 

marijuana 68 lbs. 

Pharmaceuticals over 15,000 pills 



PtJBLIC INTEGRITY DIVISION 

In 1994, the Public Integrity Division commenced over thirty 
criminal prosecutions against those individuals and corporations 
who violated the public trust. During the same time period, over 
thirty criminal prosecutions were resolved. 

The Division initiated several prosecutions of incidents of 
corruption within the field of law enforcement. The Chief of 
Mansfield's Police Department was successfully prosecuted on 
larceny, perjury, false claims and related charges. At trial, 
the Division's prosecutor proved that the Chief committed several 
offenses, such as making false statements on handgun permits and 
embezzling drug forfeiture funds. The Chief was convicted after 
trial, and his co-conspirator pled guilty. 

The Division also brought criminal charges against a Duxbury 
Police Officer, a Department of Public Safety fraud investigator 
and two Department of Probation officers. The charges alleged 
that the Duxbury police officer abused his position in an effort 
to obtain a real estate easement for his personal benefit from 
an elderly Duxbury resident. 

A Department of Public Safety fraud investigator was brought 
up on attempted extortion and larceny charges for soliciting and 
accepting money from welfare recipients. Furthermore, two 
Springfield District Court probation officers were recently 
charged with bribery for soliciting money from a probationer that 
they supervised. 

In addition to the above charges, the Division recently 
commenced criminal charges against a Boston police detective and 
another police department employee accused of obstruction of 
justice in fraudulently attempting to obtain a dismissal of 
criminal charges against one of their friends. 



37 



This past year, the Division also commenced several criminal 
prosecutions against public employees for larcenous schemes 
committed upon the Commonwealth. Five former employees of the 
Massachusetts Highway Department were convicted of larceny for 
their role in a no-show job scheme at the Highway Department's 
radio room. Two former employees of the Department of Public 
Health were charged with larceny for their role in filing false 
time sheets with that agency. Furthermore, a maintenance 
supervisor at the Chelsea Soldier's Home was charged with 
bribery for soliciting and accepting kickbacks from employees he 
supervised. In exchange for the bribes, the supervisor allegedly 
approved falsely inflated time sheets on behalf of the employees 
he supervised. 

The Division also continued to investigate and prosecute 
businesses for procurement fraud committed upon the Commonwealth. 
Two individuals were recently indicted for larceny and 
procurement fraud charges pertaining to a non-profit corporation 
that held a state contract. The indictments alleged that the 
defendants diverted state funds that were targeted for the 
operation of a homeless shelter. These funds were eventually 
spent on personal items by the defendants. 

Another business, including two of its owners, was prosecuted 
for fraud in the minority business enterprise program. Another 
corporation was prosecuted for submitting falsely inflated 
claims to the Metropolitan District Commission. 

The Division also brought criminal charges against individuals 
that used their public office to take advantage of individual 
citizens. A social worker for the Brockton Multi-Service Center 
was indicted on larceny charges for allegedly extorting money 
from a client that the social worker counseled. Furthermore, as 
stated above, a Duxbury Police Officer was indicted for allegedly 
defrauding an elderly resident of a real estate easement. 

The Division continued to coordinate the Public Integrity 
Advisory Group, which brought together representatives of a wide 
variety of officials from the various executive branches, 
independent authorities, state agencies and watchdog groups to 
advise the Attorney General on law enforcement strategy relating 
to ethics and government. 

The task force members successfully referred a number of cases 
to the Division to advise the Attorney General on law enforcement 
strategies relating to ethics and government, and were able to 
combine their resources to effectively investigate and prosecute 
cases. An example of such referrals are two municipal housing 
directors that were charged with larceny pertaining to 
allegations of embezzlement at their respective agencies. Both 
cases were referred by the State Auditor's Office, which assisted 
in the investigation. 



38 



This past year, the Advisory Group's subcommittee focused upon 
various methods to ensure integrity and ethical conduct in the 
numerous public offices within the Commonwealth. The Advisory 
Group established a Public Integrity Awareness Program, designed 
to increase awareness of the ethical obligations of public 
employees and to ensure compliance with the laws governing public 
employees. One component of the program involves efforts to 
raise ethical awareness among state agencies of issues involving 
public employee's ethical responsibilities. Last March, the 
Advisory Group, in conjunction with the Governor's Office of 
Legal Counsel, sponsored an ethics briefing for agency counsel. 
This briefing, while focused on common issues involving fraud and 
corruption among public employees, was intended to familiarize 
agency counsel with the legal obligation of public employees and 
the prosecution of ethics violators. 

The Advisory Group also has developed a brochure for state 
employees summarizing their ethical responsibilities under state 
law. This measure is aimed at ensuring that public employees are 
familiar with their ethical obligations under the law and at 
providing them with direction regarding where to turn with 
questions about their ethical obligations. The brochure will be 
distributed with paychecks in the fall of 1994. Finally, 
beginning in 1985 new state employees will be provided with, and 
required to acknowledge receipt of copies of the conflict of 
interest and campaign finance laws. 

A review of the cases prosecuted by this Division reveals 
that it was successful in bringing cases at all levels of 
government in virtually every corner of the state. 

CASES CHARGED BY PUBLIC INTEGRITY DIVISION 

Date Indicted 

7/93 Commonwealth v. Marsh 

2 counts procurement fraud; 
2 counts false claims; 
2 counts corrupt gifts; 

7/93 Commonwealth v. Halligan 

1 count procurement fraud; 
1 count false claims; 
I count corrupt gifts; 

7/93 Commonwealth v. Burke 

1 count procurement fraud; 
1 count false claims; 
1 count corrupt gifts; 

7/93 Commonwealth v. Westerbeake, Inc. 
1 count procurement fraud; 
I count false claims 



39 



7/93 Commonwealth v. B 

2 counts procurement fraud; 

2 counts false claims; 

7 counts larceny 

9/93 Commonwealth v. Katch 

(U.Mass Professor) 
1 count conflict of interest 

10/93 Commonwealth v. Rogers 

(DPW Employee) 

I count larceny over $250 

10/93 Commonwealth v. Soo Hoo 
(DPW Employee) 
1 count larceny over $250 

11/93 Commonwealth v. Boizigian 

(Essex County Sheriff's Office) 
3 counts larceny over $250 

11/93 Commonwealth v. Group Benefit Strategies, Inc , 
(City of Springfield Contract) 
10 counts larceny over $250 
10 counts false claims 

11/93 Commonwealth v. Tinsley 

(City of Springfield Contract) 

10 counts larceny over $250 

10 counts false claims 

1 count payment of illegal gratuity 

1 count attempted larceny 

I count conspiracy to commit larceny 

11/93 Commonwealth v. Dougherty 

(City of Springfield Contract) 

9 counts larceny over $250 

9 counts false claims 

1 count payment of illegal gratuity 

1 count conspiracy to commit larceny 

11/93 Commonwealth v. Sharry 

(City of Springfield Contract) 
3 counts larceny over $250 

11/93 Commonwealth v. Moore 

(Department of Public Safety Employee) 

2 counts willful subscription of 
false tax return 

I count willful attempt to 
evade and defeat income tax 



1/94 Commonwealth v. Diterlizzi 

Department of Public Safety Employee) 
8 counts larceny over $250 
8 counts attempted extortion 

1/94 Commonwealth v. Walsh 

(State Police Officer) 
Operating to endanger 

1/94 Commonwealth v. Calnen 

(Suffolk County Grand Juror) 
2 counts larceny over $250 
1 count perjury 

3/94 Commonwealth v. Peterson 

(Oxford Housing Authority) 

1 counts larceny over $250 

4 counts forgery 

4 counts uttering 

1 count filing false claims 

3/94 Commonwealth v. Wilkins 

(Department of Public Health) 
2 counts larceny over $250 
2 counts procurement fraud 
2 counts false claims 

3/94 Commonwealth v. Goveia 

(Department of Public Health) 
2 counts larceny over $250 
2 counts procurement fraud 
2 counts false claims 

3/94 Commonwealth v. Borden 

(Chelsea Soldier's Home) 
I count bribery 

3/94 Commonwealth v. Stanley 

(Registry of Motor Vehicles employee) 

I count bribery 

1 count falsifying driver's license 

1 count false written report 

3/94 Commonwealth v. Lopes 

(Brockton Multi-Service Center Social 
Worker) 

2 counts larceny over $2 50 
1 count attempted extortion 

4/94 Commonwealth v. deRusha 

(Flynn Campaign Committee) 
I count income tax evasion 



4/94 



Commonwealth v. Hardy 

(Lancaster Housing Authority) 

3 counts larceny over $250 

6 counts uttering a forged instrument 

12 counts presentation of false claims 



5/94 



Commonwealth v. Dormandy 

(Duxbury Police Department) 
1 count larceny over $250 



6/94 



Commonwealth v. Sheehan 

{Holbrook Police Department] 
I count larceny 
1 count conspiracy 



6/94 



Commonwealth v. Furlani 
I count larceny 
I count conspiracy 



7/94 



witness 



7/94 



witness 



7/94 



witness 



Commonwealth v. Hiiziins, Jr. 

(Boston Police Department) 

1 count interference with witness 

I count conspiracy to interfere with a 

1 count attempt to obstruct justice 
1 count conspiracy to obstruct justice 

Commonwealth v. Marshall 

1 count interference with witness 

1 count conspiracy to interfere with a 

1 count attempt to obstruct justice 
1 count conspiracy to obstruct justice 

Commonwealth v. Swirbalus 

(Boston Police Department) 

1 count interference with witness 

1 count conspiracy to interfere with a 

2 counts attempt to obstruct justice 

1 count conspiracy to obstruct justice 



8/94 



Commonwealth v. Jorge 

(Department of Probation) 
1 count soliciting bribe (c, 
1 count soliciting bribe (c, 
1 count conspiracy 
1 count larceny over $250 



268A, 
268A, 



2) 
3) 



42 



8/94 Commonwealth v. O'Brien 

(Department of Probation) 

1 count soliciting bribe (c. 268A, 2) 

1 count soliciting bribe (c. 268A, 3) 

1 count conspiracy 

1 count larceny over $250 

8/94 Commonwealth v. Cleckley 

(Bostonian Chambers employee) 

4 counts larceny over $250 

14 counts false claims 

14 counts procurement fraud 

14 counts false written statements 

8/94 Commonwealth v. Schand 

(Bostonian Chambers employee) 

12 counts false claims 

12 counts procurement fraud 

CRIMINAL CASES PENDING 

Date Indicted 

9/92 Commonwealth v. Bunk 

(former Conservation Commissioner - Taunton) 
4 counts conflict of interest 

12/92 Commonwealth v. Smith 

(Yarmouth Water Department) 
34 counts larceny 
2 counts procurement fraud 
2 counts conflict of interest 

3/93 Commonwealth v. Sheehan 

(Holbrook Police Department) 
Bribery, Receiving Stolen Property, 

Conspiracy 

4/93 Commonwealth v. Procopio 

(Rehoboth clerk) 

2 counts larceny 

2 counts false written report and 
embezzlement 

7/93 Commonwealth v. Marsh 

2 counts procurement fraud; 
2 counts false claims; 
2 counts corrupt gifts; 



43 



DISPOSITIONS FISCAL YEAR 1994 

Coiranonwealth v. Matchett 

2 1/2 to 3 years MCI. 

Commonwealth v. Lynch/Enterprise Equipment: 

Lynch - nolo plea, 3-5 years, suspended for 4 years. 

100 hours of alternative punishment. $10,000 

fine and $11,850 restitution. 
Invernizzi - nolo plea, 6 months probation, 

$5,000 fine and $5,000 restitution. 

Enterprise Equipment Corp. nolo plea, $10,000 fine, 

Commonwealth v. Hurley 

2 years HOC, 

3 months to serve, 
$23,000 restitution. 

Commonwealth v. Ellis 

1 year HOC, suspended, 

2 years probation 

Commonwealth v. Foley 

3-5 years MCI suspended 

Commonwealth v. Neary 

3-5 years MCI, suspended, 
$17,472.08 restitution 



Commonwealth v. Barnstead 

2 years HOC, suspended, 
$4,375.29 restitution 

Commonwealth v. Benevento 

3-5 years MCI suspended for 3 years 
$13,556.00 restitution. 

Commonwealth v. Berizin 

3-5 years, suspended. 
$4500 restitution. 

Commonwealth v. Sinksen 

4-5 years MCI suspended, 
$300 restitution. 

Commonwealth v. Lombard 

2 years HOC, suspended, 
$6200 restitution. 



Commonwealth v. Earls 

3-5 years MCI, suspended; 
$4,621.95 restitution. 

Commonwealth v. D'Urso 

$3,939.00 restitution. 
Pre-trial probation for 2 years. 

Commonwealth v. Barrows, Jr. 

2 1/2 years HOC , I year to serve, 
balance suspended for 4 years . 

Commonwealth v. Elizabeth Quirk 
2 years probation, 
$24,500 restitution. 

Commonwealth v. Hamwey 

1 year pre-trial probation $15,000 costs 

Commonwealth v. C.J Mabard Inc. 

1 year pre-trial probation $15,000 costs 

Commonwealth v. Katch 

2 years probation, 

500 hours community service, 
$3,000 fine. 

Commonwealth v. Walsh 

3 months HOC, suspended, 
$200 fine. 

Commonwealth v. Paul Ouirk 

Not guilty after trial. 

Commonwealth v. Cater 

Probation for one year, 
restitution of $1,360. 

Commonwealth v. Doherty 

2 1/2 years in H.O.C., suspended, 
200 hours community service. 

Commonwealth v. Brown 
4-5 years MCI . 

Commonwealth v. Katsirubas 

2 years HOC, 3 months committed, 
$12,000 fine. 

Commonwealth v. Smart 

Not guilty after trial. 



Commonwealth v. Hardy 

1 year HOC suspended for two years, 
250 hours community service, 
$5,144.00 restitution. 

Commonwealth v. Cronin 

2 years HOC, 9 months to serve, 
$41,768.00 restitution. 

Commonwealth v O'Brien 
Dismissed 

Commonwealth v. Donohue 
Dismissed 



46 



ECONOMIC CRIMES DIVISION 

In Fiscal Year 1994 the Economic Crimes Division continued to 
handle a heavy caseload involving all types of financial crimes. 
The division concentrates on cases involving insurance fraud, tax 
crimes and "white collar crimes". Many cases involve fraud 
against elderly citizens and financial institutions. Often, 
defendants are professionals who abuse the trust placed in them 
by clients and employers. Because such cases tend to be complex, 
investigations often require the review of extensive documents 
and records. Therefore, in addition to nine attorneys, the 
division also includes financial investigators and police 
officers. The Division receives referrals from private parties, 
law firms, state agencies, private agencies, financial 
institutions and a variety of federal agencies. 

The Division was busy and productive in Fiscal Year 1994. The 
Division conducted a significant number of investigations, often 
resulting in referrals to other prosecution agencies, or other 
bureaus in the office. In addition, approximately 85 new cases 
were charged in various courts of the Commonwealth and over 40 
cases were successfully prosecuted to final depositions. Cases 
handled by the Economic Crimes Division, including its Insurance 
Fraud Unit and Tax Prosecution Unit are discussed below. 

INSURANCE FRAUD UNIT 

The Insurance Fraud Unit continued its work of investigating 
and prosecuting all types of workers compensation fraud, motor 
vehicle insurance fraud, homeowners insurance fraud, life 
insurance fraud and fraud by "insiders", including agents, 
adjusters and insurance company employees. Investigations and 
prosecutions were handled by three full-time insurance fraud 
prosecutors as well as many other AAGs throughout this division 
and other divisions of the criminal bureau. 

The Insurance Fraud Unit initiated approximately 35 new cases 
in Fiscal Year 1994 in district and superior courts throughout 
the Commonwealth. Some highlights from the new cases include: 

• In July, 1993 a defendant was indicted in Suffolk Superior 
Court on a charge of perjury after he gave false testimony at a 
hearing before the Department of Industrial Accidents. An 
investigation revealed that the defendant attempted to conceal 
the fact that he had filed a previous claim under a different 
name, facts which he denied during a hearing before the DIA. 

• In September, 1993 an individual was arrested and charged in 
Boston Municipal Court with filing a fraudulent insurance claim 
and attempted larceny after he submitted a phony death 
certificate and attempted to collect a $135,000 life insurance 
policy on his wife. The defendant's wife had been deported 
following another criminal matter, and when she was overseas 



47 



the defendant submitted the false insurance claim. An 
extensive investigation was conducted involving private 
investigators in Nigeria and the assistance of the Insurance 
Fraud Bureau of Massachusetts. As a result, this defendant 
subsequently was indicted in Suffolk Superior Court. This case 
proceeded to a jury trial in Suffolk Superior Court in June of 
1994 following which the defendant was convicted and sentenced 
to 2 1/2 - 5 years in MCI-Cedar Junction. His insurance claim 
was denied and it is expected that he will be deported 
following completion of his sentence. 

In October 1993, a chiropractor with an office in Melrose was 
indicted in Middlesex Superior Court on 58 separate indictments 
charging larceny, attempted larceny, insurance fraud and 
conspiracy. The charges were the result of a two- year 
investigation which revealed that the defendant provided 
treatment and medical reports to a number of patients who were 
allegedly using false names, who had been treated for identical 
injuries previously, or who were involved in fictitious 
accidents . 

In March 1994, a former insurance agent was indicted in 
Plymouth Superior Court on multiple counts of forgery and 
larceny after an investigation revealed that she had defrauded 
a premium financing company by submitting fraudulent insurance 
applications including financing agreements. The defendant 
applied for financing without the knowledge of the policyholder 
and converted the premium financing for her own purposes. An 
extensive investigation by the Insurance Fraud Bureau located 
all of the docuinents submitted by the defendant as well as a 
series of other documents containing original handwriting and 
signatures of the defendant. The handwriting was submitted to 
an expert who was able to verify that the handwriting on the 
false insurance applications and finance applications was the 
handwriting of the defendant. 

In April 1994, charges were obtained in three separate district 
courts against three individuals involved in a series of 
fraudulent insurance claims. Charges were obtained in Peabody 
District Court, Boston Municipal Court and Lowell District 
Court against all three individuals. The investigation in this 
case by the Massachusetts Insurance Fraud Bureau revealed that 
the defendant staged motor vehicle accidents or deliberate 
collisions and then filed property damage claims and bodily 
injury claims. 

In April 1994, an investigation by the Massachusetts Insurance 
Fraud Bureau and State Police in both Massachusetts and Rhode 
Island uncovered an attempt by three individuals to conceal a 
motor vehicle so that its owner could file a theft claim with 
his insurer. A sting operation was conducted and three 
defendants were caught in the act of concealing the motor 
vehicle and then delivering it to a "buyer" who turned out to 



48 



be an undercover state trooper. The defendants were charged 
with concealing a motor vehicle to defraud an insurer, 
attempted larceny and defacing vehicle identification numbers. 
Because of the cooperation and quick intervention by the 
Insurance Fraud Bureau and the Massachusetts State Police and 
Rhode Island State Police, the claim was not honored. The 
defendants were found guilty, placed on probation, ordered to 
pay fines and ordered to perform extensive community service. 

• In April 1994, three defendants were indicted in Plymouth 
Superior Court after they conspired to submit a fraudulent 
personal injury claim under a homeowners policy. One of the 
defendants injured himself following a party at a bar in Rhode 
Island. Subsequently, two of the defendants agreed to submit a 
claim that the defendant had injured himself at his friend's 
house. The friend filed a claim on his homeowners insurance 
policy seeking to recover for the injury. The third defendant, 
the wife of one defendant, assisted the scheme by submitting 
false statements in aid of the scheme. 

• In June 1994, a defendant was indicted in Middlesex Superior 
Court on charges of workers compensation insurance fraud, 
filing a fraudulent insurance claim and larceny. Following an 
alleged workplace injury, the defendant received total 
disability benefits from his employer. While collecting those 
benefits he worked three separate full-time jobs for three 
separate employers and collected over $35,000 in total 
disability benefits. 

In FY 94 the Unit continued to recommend periods of 
incarceration where appropriate, as the primary method to deter 
insurance fraud crimes. At the same time, fines and restitution 
were requested to make sure that any financial gain obtained by a 
defendant is returned to the insurance companies so that 
ratepayers are not burdened by the effects of fraud. Some of the 
cases which were prosecuted to a final disposition in FY 94 
include: 

• In September 1993, a defendant was convicted in the Boston 
Municipal Court Jury of six session on charges that he received 
a stolen motor vehicle and that he altered the vehicle 
identification numbers. The vehicle in question, a 
recreational vehicle, had been reported stolen earlier by 
another individual. An insurance company investigator located 
the recreational vehicle in the possession of this defendant. 
The defendant was convicted after a trial, given a suspended 
sentence and ordered to pay restitution in the amount of 
$13,721. 

• In October 1993, a defendant was convicted in Middlesex 
Superior Court on two counts of motor vehicle insurance fraud 
and two counts of larceny. This defendant was one of the 
individuals identified during an investigation into a series of 



fictitious accident claims in the Cambridge-Somerville area. 
The defendant was sentenced to two years in the House of 
correction with one year to serve and was ordered to pay $2,000 
in restitution to his insurer. 

• In March 1994, a defendant was convicted in Norfolk Superior 
Court as a result of an investigation conducted by the 
Massachusetts Insurance Fraud Bureau and referred to the 
Attorney General's Office. The defendant was also indicted in 
Suffolk Superior Court as a result of this investigation. The 
defendant, an insurance agent, was charged with ten indictments 
for larceny over $250 in connection with a scheme by which he 
sold bogus insurance polices to customers and kept the 
premiums. The defendant was found guilty and was given a 
sentence of 7-10 years at MCI-Cedar Junction with two and one 
half years to serve and the balance suspended for five years 
with probation. The defendant was ordered to surrender his 
insurance agent license and not to apply for a new license and 
was further ordered to pay $5,000 in restitution to various 
victims of this scheme. 

At the same time these cases were charged or prosecuted to 
completion, significant training programs were prepared and 
presented to insurance company representatives, police officers, 
attorneys and other individuals throughout the Commonwealth. The 
volume of cases and investigations handled, as well as the 
successful prosecutions, are the result of the hard work of the 
Insurance Fraud Unit, investigators from the Massachusetts 
Insurance Fraud Bureau, and adjusters and special investigators 
from insurance companies, all of whom are dedicated to deterring 
insurance fraud by aggressively investigating and prosecuting 
such cases . 

TAX PROSECUTION UNIT 

In FY 94 the Tax Prosecution Unit prosecuted a significant 
number of cases and conducted several long-term investigations of 
suspected tax crimes. Although each AAG in the Economic Crimes 
Division handles a caseload including tax cases, one AAG 
concentrates full time on this subject area. Many cases were 
referred to the office of the Attorney General by the Criminal 
Investigations Bureau of the Massachusetts Department of Revenue 
and investigators from that agency actively assisted the Tax 
Prosecution Unit in investigations and prosecutions in FY 94. Two 
jury trials were recently concluded in Suffolk Superior Court. 
The analysis, documentation and witnesses provided by the 
Department of Revenue were invaluable in the successful 
prosecution of these cases. A separate long-term investigation 
conducted by the Tax Prosecution Unit, DOR investigators and 
members of the Criminal Bureau Public Integrity Division resulted 
in charges against numerous individuals. In addition, other 
cases were developed by the Tax Prosecution Unit as a result of 
referrals from other agencies. During FY 94, twenty-five new 
cases were charged in Superior Court and seven pending cases were 



successfully prosecuted to completion. Selected highlights of 
prosecutions conducted by the Tax Prosecution Unit in FY 94 
include: 

• In August 1993, an individual was indicted in Suffolk Superior 
Court on a charge of filing a false tax return following an 
investigation conducted by the Tax Prosecution unit and 
investigators from the Criminal Investigations Bureau of the 
Massachusetts Department of Revenue. That investigation 
revealed that the defendant derived significant income from an 
insurance oversight company he operated, which income he failed 
to report an his tax returns. Additional aspects of that 
investigation were conducted in connection with the Public 
Integrity Division which resulted in charges against the 
defendant's company which defrauded the City of Springfield by 
submitting false and exaggerated claims in connection with an 
insurance cost control arrangement between that company and 
Springfield. 

• In August 1993, Department of Revenue investigators uncovered a 
scheme involving the filing of fraudulent state income tax 
returns and immediately referred that matter to the Tax 
Prosecution Unit. As a result of the subsequent investigation, 
an individual was arrested and charged in Boston Municipal 
Court with larceny over $250 and charges of filing false tax 
returns. Further investigation conducted in conjunction with 
Department of Revenue investigators revealed that the arrested 
individual was working with an inmate at a state prison who was 
responsible for filing a number of false individual income tax 
returns. Investigation and research by the Department of 
Revenue allowed this office to obtain indictments against two 
individuals in Suffolk Superior Court on multiple charges of 
larceny, conspiracy and filing false tax returns. One 
defendant cooperated with the Commonwealth, plead guilty and 
was incarcerated for his role in the scheme. Charges are still 
pending against the second defendant, who remains incarcerated 
on other matters. 

• In February 1994, a Rochester businessman plead guilty in 
Suffolk Superior Court to criminal tax charges involving tax 
evasion, failure to account for meals taxes and failure to file 
corporate tax returns. The defendant failed to pay the 
Commonwealth approximately $240,000 in meals taxes he collected 
at a number of donut and coffee shops he operated. The 
defendant was ordered to serve two years in the House of 
Correction, placed on probation and ordered to perform one 
thousand hours of community service following his release from 
jail. 

• A South Dartmouth businessman who operated a company 
specializing in pre-fabricated homes was indicted on eight 
counts of failure to account for and pay over withholding 
taxes. The investigation in this case revealed that the 



51 



defendant withheld taxes on approximately 1.3 million dollars 
in salaries paid to his employees but failed to account for and 
pay over such taxes to the Commonwealth. The unpaid tax 
liability in this case amounted to approximately $65,000. 

• A firefighter from Milton was indicted in Suffolk Superior 
Court on charges of failure to pay over sales taxes and failure 
to pay withholding taxes. The defendant operated a local 
bicycle sales and repair shop in addition to his job as a 
firefighters He failed to pay over approximately $40,000 in 
sales and withholding taxes on approximately $750,000 of sales 
and wages from his bicycle business. 

• A husband and wife were indicted in Suffolk Superior Court on 
multiple counts of sales tax evasion and failure to account for 
and pay over sales taxes. The defendants owned and operated 14 
taxicabs through seven different corporations they controlled. 
Tax returns filed by the couple failed to account for over 
$750,000 in taxicab rental fees on which the couple owed 
approximately $3 8,000 in sales taxes. 

• A South Hadley businessman and a corporation he owned were each 
indicted on one count of meals tax evasion, one count of 
failure to account for meals taxes and four counts of failure 
to file corporate excise tax returns. The investigation 
conducted by the Criminal investigations Bureau of the 
Department of Revenue determined that the individual defendant 
owned a bar in Holyoke. The defendant and his corporation 
failed to pay approximately $35,000 in meals and excise taxes 
by failing to report sales to the Department of Revenue or 
falsely reporting the amount of such sales. 

• A local businessman was indicted in Suffolk Superior Court on 
charges that he filed false personal income tax returns in an 
attempt to conceal his earnings from a company he controlled. 
After further investigation the corporation was also indicted 
on a series of tax charges. The cases resulted from an 
investigation into a check cashing service located in Brockton. 
The defendant cashed account receivable checks payable to the 
corporation at the check cashing service so that those receipts 
would not appear on the company's ledgers. The accountants who 
prepared tax returns for the corporation was not informed of 
the additional income and the corporate tax returns therefore 
were not correct. The individual defendant cashed the checks 
and used the receipts for his own purposes without declaring 
the amounts received on either the corporate or his individual 
tax returns. 



52 



ECONOMIC CRIMES UNIT 

The Economic Crimes Unit worked on a wide variety of cases and 
complex investigations. Complaints were referred to the Unit by 
state agencies, attorneys, private citizens, federal agencies 
(e.g., the FDIC, Secret Service, FBI, Postal Inspector, etc.), 
the Board of Bar Overseers and state and local police officers. 
The Unit also prosecuted a number of cases which were referred to 
this office due to a conflict on the part of local district 
attorneys. Over 25 separate new cases were initiated by the 
Economic Crimes Unit in FY 94 including: 

• A former attorney, the former head of a large trusts and 
estate department of a major Boston law firm, was indicted in 
Suffolk Superior Court on charges of embezzlement, larceny and 
forgery. The investigation which resulted in the indictments 
revealed that the defendant embezzled approximately $350,000 
from a number of elderly clients. While the investigation was 
ongoing, the defendant attempted to gain control of an estate 
valued at approximately $500,000 by forging a will and other 
documents which purported to give the estate to the defendant. 
This matter was prosecuted by the Economic Crimes Unit after a 
referral from the Board of Bar overseers. 

• In August 1993, a woman was indicted in Worcester county on 
charges of practicing medicine without a license and larceny 
over $250. Indictments were also obtained in Norfolk and 
Middlesex Counties. Investigation in this case revealed that 
the woman posed as a licensed physician when in fact she had no 
significant medical training. She administered physical 
examinations to bus drivers for a number of companies in the 
Commonwealth and billed for her services, representing that she 
was a physician. In addition, she billed the companies for 
urine and blood testing even though she routinely disposed of 
the samples without submitting them for laboratory testing. 

• An attorney and an accountant who assisted him were indicted in 
Barnstable Superior Court on multiple counts of embezzlement. 
The defendant attorney conducted real estate closings on behalf 
of a title insurance company. However, instead of turning over 
the proceedings of the closing to the appropriate party, the 
defendant diverted the money to pay for office and personal 
expenses. He then used money from subsequently closings to pay 
off amounts due on earlier closings which were overdue. The 
investigation revealed that the defendant could not account for 
funds from seventeen separate real estate closings he had 
conducted. A second defendant, an accountant, worked with the 
attorney and facilitated this scheme to embezzle money. The 
amount of money embezzled by the defendants was well in excess 
of one million dollars. 



• A former chief financial officer of a local manufacturing and 
distribution company was indicted in Middlesex Superior Court 
on multiple counts of larceny by embezzlement after an 
investigation revealed that he had embezzled approximately 
$800,000 from his employer. The defendant used company funds 
to pay for his personal expenses and to pay for expenses of a 
private consulting business which the defendant operated. A 
physician who was a noted researcher as well as chief of 
cardiology at a local hospital was indicted in Suffolk Superior 
Court on six counts of larceny after an investigation revealed 
that he had used his position of authority to embezzle 
approximately $130,000. An individual was indicted in Suffolk 
Superior Court after an investigation revealed that she stole 
approximately $23,000 from a non-profit Boston organization 
which provided treatment and counseling for AIDS victims and 
treatment for substance abuse problems. The defendant used her 
position of trust to obtain control of organization credit 
cards and to have checks improperly issued to herself. The 
defendant used four different schemes to conceal her larcenies 
from the organization and made false entries in corporate 
ledgers and books to cover up her thefts. The defendant was 
charged with multiple counts of larceny, forgery and making 
false entries in corporate books. 

• A defendant, a disbarred attorney, was indicted in Worcester 
Superior Court on charges that he embezzled approximately 
$397,000 from a title insurance company while acting as a 
closing attorney. The defendant issued false title insurance 
policies which concealed the fact that he had not paid the 
mortgages on the properties. 

In FY 94 the Economic Crimes Unit conducted a significant 
number of criminal investigations in addition to the matters 
highlighted above. At the same time, the Unit was able to 
successfully complete prosecution of a number of pending criminal 
cases. Of the prosecutions completed in FY 94, some of the 
dispositions of note are: 

• A former Suffolk County jail officer was convicted after a jury 
trial in Suffolk Superior Court on a charge of assault and 
battery by means of a dangerous weapon. The defendant at the 
time of the incident in question was a Lieutenant in charge of 
most of the prisoners in the old Charles Street Jail. After an 
argument between an inmate and a jail officer the defendant 
assaulted punched and kicked the inmate while the inmate was 
being restrained by other officers. Following an investigation 
by the Sheriff's Department the defendant was suspended and 
prevented from working at the jail. The inmate recovered from 
his injuries. The defendant received a suspended sentence with 
probation supervision. 



54 



• A manager of a local bank was convicted in Norfolk Superior 
Court on thirty two indictments charging her with stealing from 
16 separate customer accounts and with making false entries in 
bank records. The investigation revealed that the defendant 
embezzled in excess of $100,000 by using her position of 
authority to withdraw amounts from customer accounts. Many of 
the victims of her embezzlement were elderly account holders 
who were not aware that the sums were being withdrawn. The 
Commonwealth requested the court to incarcerate the defendant 
because of the violation of trust placed in her and because the 
victims of her scheme were elderly account holders. The court, 
instead, ordered the defendant to serve a period of home 
confinement . 

• A defendant was convicted in Suffolk Superior Court on counts 
of larceny, forgery and uttering after an investigation 
revealed that he was issuing bogus insurance bonds . The 
defendant previously had been prosecuted for similar crimes and 
previously had been ordered not to engage in such activity 
again. Despite that earlier warning from the court, the 
defendant represented to numerous customers that he would 
secure insurance bonds for the customers. Upon his conviction 
on multiple counts of larceny, forgery and uttering as well as 
one count of acting as an insurance broker without a license, 
the defendant was adjudged to be a common and notorious thief 
and sentenced to MCI-Cedar Junction. 

• A Gloucester-area attorney was convicted in Essex Superior 
Court on twelve indictments charging larceny, sixteen 
indictments charging forgery, fourteen indictments charging 
uttering a forged instrument, and two counts of embezzlement by 
a fiduciary. The defendant was an attorney who administered 
trusts and estates for a number of clients. He used that 
position of trust to steal from his clients, including many 
elderly clients whose estates he administered. The initial 
investigation revealed that the defendant had stolen 
approximately $600,000 from a number of elderly clients and he 
was indicted for those acts of embezzlement. While that case 
was pending in Essex Superior Court, further investigation 
revealed that the defendant stole approximately $900,000 from 
another estate. The defendant was caught in the act of 
attempting to wire money out of the country and he made 
statements that he intended to leave the area. The total 
amount embezzled by the defendant from his clients was 
approximately 1.5 million dollars. The defendant was ordered 
to serve a period of incarceration at MCI-Cedar Junction. 

• A former attorney was convicted in Suffolk Superior Court on 
multiple counts of embezzlement by a fiduciary and larceny 
based on evidence that he embezzled client funds to invest in 
his own business ventures. One of the victims was a 99 year 
old widow whose estate the defendant administered. The 



defendant used the victims' money to support the defendant's 
private real estate development. The total amount of money 
this defendant embezzled from his clients was in excess of one 
million dollars. After a jury trial in Suffolk superior Court 
the judge sentenced the defendant to serve two years in the 
House of Correction. 

• A former attorney was convicted in Suffolk Superior Court on 22 
counts of embezzlement, 22 counts of larceny, 1 count of 
attempted larceny and 3 counts of uttering a forged instrument. 
The defendant was ordered to serve two years in the House of 
Correction and had a suspended 5-7 year state prison sentence 
imposed on and after the period of incarceration. 



56 



FAIR LABOR AND BUSINESS PRACTICES DIVISION 

I. CREATION OF THE FAIR LABOR AND BUSINESS PRACTICES DIVISION 

A. Legislative Mandate: 

On September 28, 1993, pursuant to Chapter 110 of the Acts of 
1993, the Massachusetts State Legislature transferred most of the 
functions once performed by the Department of Labor and 
Industries (D.L.I.) to the Office of the Attorney General. The 
statutory responsibilities of the Attorney General's new Fair 
Labor and Business Practices Division includes the investigation 
and enforcement of laws pertaining to child labor, hours and 
working conditions, wages, fair competition for bidders on public 
construction jobs and workplace safety. To accomplish this, 
criminal complaints may be filed against alleged violators of 
these labor laws and appropriate statutory penalties sought. Or, 
if an investigation reveals that a contractor or subcontractor 
has failed to pay the prevailing wage on a public works job, the 
Attorney General may conduct a hearing and order work halted 
until the defaulting party has filed with the Attorney General's 
office a bond in the amount of a penal sum as determined by the 
Attorney General and conditioned upon payment of the prevailing 
wage rate. 

Last, an employee may, at the expiration of ninety days after 
the filing of a complaint with the attorney general, or sooner if 
the Attorney General assents in writing, institute a civil action 
for injunctive relief and damages incurred. An employee who 
prevails may obtain treble damages for any loss of wages or other 
benefits and shall be entitled to litigation costs and reasonable 
attorneys fees. 

B. Establishment of the Division 

On October 4, 1994 the Office of the Attorney General began 
the process of absorbing the functions and personnel mandated by 
the transfer legislation. The first step involved the 
consolidation of the four regional offices that had been closed 
by the DLI due to lack of funding into the Boston and Springfield 
offices. The division then began the recall of attorneys, 
managers, inspectors and support staff who had been laid off by 
D.L.I, for the prior three months due to uncertainty over the 
Department's future. 

Although in 1988 D.L.I, employed 188 individuals, the 
overwhelming majority of whom performed many of the same 
functions transferred to the Attorney General's office, only 34 
positions were transferred to the Fair Labor Division. 

The process of reviewing back complaints and the 300 pieces of 
mail received per day took the full-time effort of the majority 
of inspectors. In addition a phone system with ten lines was 
installed and manned by the staff. In the first three months of 



57 



operation, the intake unit of the Fair Labor Division received an 
average of 625 calls per day in the Boston office and 
approximately 200 calls per day in the Springfield office. 
Approximately 250 calls per day were from individuals requesting 
that complaint forms be mailed to them for completion and 
submission to the division. These complaints were and continue 
to be for a wide variety of labor and safety issues including 
nonpayment of wages, vacation, holiday pay and prevailing wages, 
personnel records access, unsafe working conditions, child labor 
exploitation and work related fatalities. 

II. ENFORCEMENT BY THE FAIR LABOR DIVISION 

Even amidst the confusion caused by the transfer, the division 
has been successful in managing the active case load inherited 
from D.L.I. As to the cases themselves, D.L.I, enforced the 
majority of wage violations through an administrative process 
with minimal criminal enforcement of the prevailing wage laws. 
The result has been an open and accepted practice within the 
state to ignore the prevailing wage laws on public works 
projects. The Fair Labor Division is attempting to reverse this 
trend by being aggressive and innovative in the enforcement area. 

The division has employed traditional law enforcement tools, 
such as the execution of search warrants and use of the 
investigative grand jury, to develop evidence of flagrant 
criminal violations of the prevailing wage. In addition, on 
April 8, 1994, the division released an advisory on the public 
bid process and prevailing wage. The advisory was published in 
the Central Register and was mailed to every city and town in the 
Commonwealth as well as all construction companies registered 
with the Division of Planning and Capital Operations. The 
advisory details the responsibilities of an awarding authority 
with respect to the review and maintenance of certified weekly 
payroll records and highlights the necessity for oversight of a 
public construction project. 

A. CHILD LABOR: 

This aggressive enforcement extends to all aspects of the 
labor laws. As part of the Attorney General's effort to prevent 
the exploitation of children in the workplace, the Fair Labor and 
Business Practices Division conducted random child labor 
inspections at sites throughout the Commonwealth during the week 
of July 15, 1994. Ten inspectors investigated 351 employers in 
50 communities. A wide array of employers were inspected, such 
as fast food eateries, restaurants, retail stores, gas stations, 
convenience stores and supermarkets, amongst others. In the week 
long sweep, 803 violations were recorded by inspectors from the 
division. The violations included failure to produce records to 
inspectors upon request, lack of a required educational 
certificate signed by the superintendent of schools or a 
designated agent, and lack of a required work permit and child 
working with heavy machinery that is prohibited by law. 
Employers with violations were given written citations along with 



58 



a warning that a follow up visit would be made to ensure future 
compliance. Those follow up visits, along with additional site 
inspections, were conducted the week of August 15 to August 19, 
1994. 

B. WORKPLACE SAFETY: 

The workplace safety mandate transferred to the office of the 
Attorney General has presented the most vexing of challenges for 
the division, as at the time of the transfer there were no D.L.I, 
inspectors who were board certified in workplace safety. Many 
workplace safety issues had previously been deferred to OSHA. 
Nonetheless, the Attorney General's Office is committed to 
increasing the division's presence in the area of workplace 
safety. To exemplify, the division along with the Boston Fire 
Department (B.F.D.) has had a great deal of involvement with the 
construction of two tunnels at Deer Island. The involvement at 
Deer Island has included several safety visits for above ground 
construction and several visits inside the outfall tunnel which 
is expected to be nine and one half miles long with only one 
means of ingress and egress. Prior to it being filled with 
treated sewerage, it will be the largest single-entranced tunnel 
in the world. Because of the outfall tunnels unique length and 
potential elevated safety risks, the Boston Fire Department has 
been vigilant in reviewing all the safety aspects of the 
construction. The B.F.D. turned to this office to elicit support 
in responding to all inquiries of safety identified by the B.F.D. 

III. EDUCATIONAL OUTREACH BY THE FAIR LABOR DIVISION 

In addition to enforcement, the Attorney General's Office is 
committed to educating the public about the wage and labor laws. 
The Attorney General created an Advisory Board, comprised of 
representatives from labor unions, the construction industry, law 
firms, management and public interest groups, to provide advice 
and direction on labor issues. The Advisory Board, in turn, 
formed three subcommittees to oversee the formulation of 
substantive legal policies in the areas of nonpayment of wages, 
bid protests and health and safety issues. 

A. ADVISORIES: 

The following eight draft advisories have been promulgated by 
the division: Professional Exemptions, Hourly Rates for 
Piecework, Minimum Daily Hours, Wage Deductions, Vacation 
Policies, Meal Periods, Wages for Employee Training, and 
Independent Contractors. These advisories were the subject of a 
Boston Bar Association Brown Bag Lunch and await final input from 
the Attorney General's Advisory Committee. 

B. CHILD LABOR BOOKLET: 

A Child Labor Safety Booklet was created which details the 
child labor laws and the penalties for violations. This booklet 
was distributed to the 361 businesses that were subject to the 
child labor site inspections. 



C. SPEAKING ENGAGEMENTS: 

As part of the ongoing outreach efforts, Assistant Attorneys 
General and Inspectors assigned to the division have spoken to 
both business and labor groups in an effort to inform them about 
their obligations and rights under Mass. Law. Such speaking 
engagements included: City Solicitors and Town Counsel, A.B.A. 
Seminar, M.B.A. Seminar, Worcester Bar Association, Boston Bar 
Association Labor Committee, Institute of Management, Institute 
of Business Law, Interpay Organization, Associated General 
Contractors, Foundation for Fair Contracting/Board of Directors, 
Mass Association of Subcontractors, MA Association of Masons, 
Utility Contractors' Association of New England, Inc., Building 
and Trades Annual Meeting, Labor Guild/Boston College and a 
Labor Seminar in Holyoke and Waltham. 

D. NOTIFICATION TO THE DISTRICT COURTS: 

The Attorney General sent a letter to the district court 
clerks notifying them of the transfer and educating them on the 
office procedures with respect to labor-related complaints. 
Complainants are informed by the clerks that contact should be 
made with the Fair Labor Division prior to the filing of a 
complaint with the court. This avoided clerks from district 
courts calling to determine who was answering for the 
Commonwealth on cases scheduled for trial when a complaint had 
not been filed with or by the Attorney General's Office. 

E. TRAINING SEMINARS: 

One of the major criticisms of D.L.I, was the inconsistency 
of the answers given to the general public. In an attempt to 
alleviate varying and often contradictory answers, a manual was 
developed to create direct answers to the most commonly asked 
questions. The Fair Labor Division conducted three day-long 
seminars for members of its staff to ensure that everyone was 
properly trained on the correct answers to the questions most 
commonly posed. 

F. LEGISLATIVE PACKAGE: 

The Fair Labor Division has identified areas in the statutes 
and regulations that require clarification. A legislative 
package encompassing technical and substantive changes is being 
prepared for submission to the Legislature. Enactment of this 
legislation will enable the division to more effectively enforce 
the state labor laws . 



60 



IV. 



STATISTICS 



The following statistics suinmarize the division's case- 
related activities during the eight months of FY94 it was in 

operation: 

LEGAL /FLAEP CASE REVIEW 

A. Court Appearances 168 

B. Number of different courts 51 

C. Cases in Legal Review 515 

D. Cases targeted for prosecution 35 



FLABP/ INTAKE STATISTICS 

Funds Recovered 1,063,144.46 

Amount sent directly by the company 
to the complainant (Boston only) $289,025.61 
Amount received and forwarded by the 
Boston office $507,881.45 

Amount received and forwarded by the 
Springfield office $266,237.40 



A. 



B. 



C. 



PHONE CALLS HANDLED PER DAY: INTAKE UNIT 




A. 


Boston 


500 


B. 


Springfield 


120 




TOTAL : 


620 


OPEN CASES 




A. 


Boston 


3,535 


B. 


Springfield 


156 


C. 


Legal Review 


164 


D. 


Default Warrants 


1,034 




TOTAL : 


4,889 


DISPOSED 


CASES 




A. 


Closed Boston 


1464 


B. 


Closed Springfield 


370 




TOTAL CLOSED 


1834 


C. 


Rejected Boston 


1156 


D. 


Rejected Springfield 


168 




TOTAL CASES REJECTED 


1324 


E. 


Private Right of Action 


325 


F. 


Legal Disposition 


51 




TOTAL P.R.A. & DISPOSITION 


376 



TOTAL CASES 



DISPOSED 



3534 



BID PROTESTS 

A. Bid protests filed 

B. Bid protests resolved 

C. Bid protests outstanding 



183 

151 

32 



D. Informational Phone Calls Answered 2000 



WAIVERS : 

The Office of the Attorney General may, when special 
circumstances are shown to exist, issue a waiver that allows an 
employer to forego adherence to a particular labor statute for a 
specified period of time. The Fair Labor Division granted 227 
waivers during the eight months of FY94. They are: 

A. Special student worker license 112 

B. Meal break exemption 3 9 

C. Seven day continuous operation 47 

D. Three hour minimum daily requirement 2 

E. Seasonal Exemption 16 

F. Theatrical (minor) 5 

G. scaffolding 3 
H. Uniform deduction 1 
J. Minors: late hours 1 
J. Ten hour days 1 

TOTAL WAIVERS GRANTED 227 

V. DEPARTMENT OF EMPLOYMENT AND TRAINING 

The Attorney General's Employment and Training Division 
provides legal assistance and representation to the Department of 
Employment and Training (D.E.T.) for criminal enforcement of the 
Employment Security Law. Employers who fail to comply with the 
provisions of the statute by not filing the required reports 
and/or not paying the required taxes necessary to fund the 
operations of D.E.T. are subject to prosecution by this division. 
Criminal complaints are also lodged against individuals who 
commit fraud by collecting unemployment benefits while employed. 
This division also briefs and argues appellate actions arising 
from the decision of the Director of Employment and Training with 
respect to the granting or denying of unemployment benefits. 

Due to the close relationship with the subject areas enforced 
by the Fair Labor Division, organizationally the D.E.T. has been 
placed under the umbrella of Fair Labor. The following data 
summarizes the activities of the D.E.T. during FY94. 



62 



DET LEGAL CASE REVIEW STATISTICS 





ND 1993 


CASES 

REFERRED 

1994 


ND 1994 




Board of Review* 


12 


1 


(11) 




Larcenies 


853 


45 


717 


(181) 


Employer 










Contributions 


839 


54 


776 


(117) 


Special 










Prosecutions 


11 









YEAR END TOTALS 


1713 


99 


1494 


(320) 



*Appellate actions arising from decisions of the D.E.T. Board of 
Review. 



Court Appearances 
Number of different courts 
Cases disposed* 
Restitution collected 

*Cases disposed indicates cases that resulted in a court finding. 
Closed cases are for inventory statistics. 



19-93 






END 1994 


860 






706 


354 






309 


242 






289 


$866, 


488. 


.14 


$822,021.65 



63 



MEDICAID FRAUD CONTROL UNIT 

1 . INTRODUCTION 

The Massachusetts Medicaid Fraud Control Unit (MFCU) was 
established in 1978 as a result of federal legislation 
authorizing individual states to investigate and prosecute 
waste, fraud and abuse within the Medicaid Program. The 
Massachusetts Unit has been certified annually since that time 
and receives 75% of its operating budget from the federal 
government . 

Congress continues to fund the Massachusetts Unit because of 
its commitment to prosecute providers who abuse the system and 
take advantage of those most vulnerable - the poor and elderly 
who depend on Medicaid for health care. During the previous 12 
months the Massachusetts Medicaid Program administered over 3.5 
billion for health care goods and services to nearly 600,000 
recipients . 

The focus of this Unit continues to be criminal prosecution 
and civil enforcement of health care providers who defraud the 
Commonwealth's Medicaid Program or who abuse and neglect nursing 
home residents. Investigating and prosecuting Medicaid provider 
fraud is a major responsibility in Massachusetts, as the state 
Medicaid Program is the largest line item in the state budget. 

During FY 194 MFCU received a total of 678 inquiries and 
complaints via telephone and mail. The vast majority of those 
related to neglect and mistreatment of residents in long term 
care facilities. MFCU conducted both preliminary and formal 
investigations of these matters resulting in the statistics 
reported below. A total of 725 matters were processed for 
potential investigation. Of those, 75 were opened by MFCU 
investigators as formal fraud investigations. During this period 
a staff of seven Assistant Attorneys General, an investigative 
staff of eighteen and support staff of four significantly 
increased enforcement activity over previous years. A staff of 
three is currently assigned to MFCU ' s regional office in 
Springfield. 

The year was highlighted by continued scrutiny of abuse, 
neglect and mistreatment referrals from long-term care 
facilities. As reported below, criminal complaints were issued 
against a variety of defendants in all regions of the state. 
Prosecutions of nursing home employees ranged from abuse, neglect 
and assault and battery to violations of resident civil rights. 
A prosecution team of two investigators along with an Assistant 
Attorney General continue to carry out Attorney General Scott 
Harshbarger ' s commitment to vigorous prosecution of physical, 
financial and emotional abuse of our elderly. 



In November 1993, Attorney General Harshbarger issued a Report 
entitled: "Abuse Neglect and Mistreatment in Massachusetts 
Nursing Homes: Enforcement and Prevention". Harshbarger ' s MFCU, 
in conjunction with Department of Public Health, Executive Office 
of Elder Affairs, and Massachusetts Federation of Nursing Homes 
trained over 1200 health care providers on detecting, reporting 
and preventing patient abuse. 

MFCU fraud and larceny prosecutions during FY 194 resulted in 
the incarceration of five individuals. Sentences imposed on 
larceny and false medicaid claims convictions ranged from two 
years to 3 days. 

Harshbarger ' s MFCU also maintained its aggressive enforcement 
of pharmaceutical manufacturers, distributors and retailers. The 
unit returned $800,000 to the Medicaid program as a result of 
anti- kickback and discounting enforcement investigations. The 
following criminal and civil enforcement actions were taken by 
the MFCU during FY '94: 

CRIMINAL FRAUD CASES 

Formal Investigations Initiated 75 

Investigations Completed and Closed 91 

Individual Indictments 90 

Corporate Indictments 7 

Individuals Convicted 21 

Corporations Convicted 4 

PATIENT ABUSE/NEGLECT CASES 

Abuse and Neglect Referrals 633 

Abuse & Neglect Preliminary Investigations 307 

Total Criminal Complaints and Indictments 2 5 

Prosecutions Completed and Closed 38 

Individuals Convicted 27' 

Pending Prosecutions 17 



Civil Overpayments Recovered 
Civil Damages Paid 
Criminal Restitution Ordered 
Other Civil Recoveries 
Civil Investigative Costs 
Civil Patient Needs Accounts 
Criminal Fines Imposed 
Other Costs Paid 



CIVIL/CRIMINAL FINANCIAL RECOVERIES 

$359,172.32 

395,000.00 

145,598.73 

400,000.00 

8, 350.05 

(PNA) 14,459.05 

45,880.00 

840.00 

TOTAL: $1,369,300.15 



The number of 27 persons convicted of patient neglect and/or 
abuse includes 19 prosecutions which were "continued without a 
finding of guilty" by the Court against the recommendation of 
Attorney General Harshbarger. 



65 



CRIMINAL PROSECUTIONS 

1. Worcester Pharmacist Pleads Guilt y 

A Worcester pharmacy and its owner plead guilty in Suffolk 
Superior Court to taking $5,000 and filing false claims for 
payment from the Medicaid Program. The defendant was sentenced 
to one year in the House of Correction, suspended for one year, 
and ordered to perform 150 hours of community service and pay 
$30,000 in fines, penalties, and restitution. Between March 1990 
and' June 1993, the defendant billed the Medicaid Program for 
prescription drugs and durable goods that were never provided to 
the Medicaid recipients named in the bills. 

2. Connecticut Lab Owner Charged with Fraud, Kickbacks 

A Bridgeport drug testing laboratory and its president were 
indicted by a Suffolk County Grand Jury for larceny, attempted 
larceny and filing false Medicaid claims in a scheme which 
allegedly bilked $150,000 from the Medicaid program. The 
defendants were each indicted on seven counts of larceny by a 
continuing scheme, and 60 counts of filing false claims to the 
Massachusetts Department of Public Welfare's Medicaid program. 
The company was additionally charged with five counts of 
individual kickbacks. The kickback allegations center around the 
defendants arranging for and providing free testing for non- 
Medicaid clients in exchange for continued Medicaid business. 

3 . Taxi Company Owner and Four Others Plead Guilty 

A Suffolk County Grand Jury returned multiple indictments 
against a Woburn taxi company, its owner and four company 
employees on charges ranging from alleged Medicaid provider fraud 
to state tax violations. The charges related to the defendants' 
alleged activity between June 1990, and February 1993, when they 
allegedly charged Medicaid for separate rides when two or more 
recipients shared the same taxi. 

In May 1994, the company and its owner plead guilty to charges 
of Medicaid fraud, larceny, and filing false claims totaling 
approximately $28,000. The defendant was sentenced to a 
suspended two-year House of Correction sentence with probation 
for a period of three years and 100 hours of community service. 
The defendants were also ordered to make restitution in the 
amount of $28,000 to the DPW and pay fines and surfines of 
$12,500. The remaining defendants plead guilty and received 
suspended jail sentences. 

4 . Lynn Physicians Charged With Distribution and Fraud 

Two Lynn Physicians were charged with multiple controlled 
substance and Medicaid fraud offenses involving the alleged 
illegal distribution of drugs to drug-addicted patients. The 
defendants allegedly tried to take advantage of a vulnerable 



66 



Medicaid population by indiscriminately dispensing illegal drugs 
to poor and drug-addicted Medicaid patients. Both were charged 
with multiple counts of illegal distribution of class C, D and E 
substances within 1,000 feet of a school, illegally dispensing 
controlled substances without being registered, and violations of 
the state Medicaid fraud laws. 

5 . Springfield Woman Sentenced to Jail for Embezzlement 

A Springfield woman was sentenced to one year in the House of 
Correction, 3 days to be served, after being found guilty in 
Hampden Superior Court of embezzling more than $27,000 from 
handicapped clients whom she was under contract by the state 
Department of Mental Retardation (DMR) to serve. The charges stem 
from a MFCU investigation into the defendant's actions as the 
executive director of Davenport, Inc., a non-profit corporation 
which contracted with DMR to provide residential services to 
handicapped persons. As executive director of Davenport, Inc., 
the defendant had control over many of the clients, bank 
accounts . 

6 . Five Charged in Separate False Billing Cases 

Five individuals were charged in separate unrelated cases 
involving the alleged theft of nearly $70,000 in Medicaid funds 
as a result of alleged false billing by those who provide health 
care to home-bound individuals. Each of these cases stems from 
alleged false billings made by the defendants to either the DPW 
or DMR for personal care benefits to Medicaid recipients. The 
MFCU prosecutions were joint initiatives with the state Division 
of Medical Assistance, DMR, DMH, and Disabled Persons Protection 
Commission. 

7 . Newton Psychiatrist Indicted for Alleged Fraud 

A Newton psychiatrist was indicted by a Suffolk County Grand 
Jury on charges of larceny and filing false Medicaid claims. The 
defendant was indicted on nine counts of filing false Medicaid 
claims and nine counts of larceny over $250 in an alleged 
Medicaid fraud scheme totaling more than $35,000. The defendant 
allegedly billed the Medicaid program for services that were 
either never performed or charged as longer office visits than 
those which actually took place. The indictments also allege 
that the defendant received payments from the Medicaid program 
for claims submitted while he was allegedly out of state. 

8 . Somerset Woman Charged in Nursing Home Theft 

A former bookkeeper from Somerset was charged with stealing 
funds totaling nearly $75,000 from a Fairhaven nursing home. The 
defendant, a former bookkeeper and office manager at the Nichols 
House Nursing Home, was allegedly involved in an embezzlement 
scheme in which she allegedly withdrew money from residents' 
trust accounts at the 108-bed facility where she worked. The 



defendant allegedly made the withdrawals account at local 
automatic teller machines. 

III. CIVIL ENFORCEMENT 

1. MFCU Reaches Settlement with Boston Non-Profit Clinic 

Attorney General Harshbarger and Bruce Bullen, Commissioner of 
the Division of Medical Assistance, entered into a civil 
settlement with a Boston non-profit mental health clinic which 
provides a variety of clinical services to children and 
adolescents in the greater Boston area. Under the terms of the 
settlement, the Clinic agreed to return $144,000 to the Medicaid 
program as a result of claims submitted for payment which were 
not supported by clinical records. As part of the settlement, the 
Clinic has also agreed to waive payment of 2,110 hours of therapy 
provided to children in Boston which may have been Medicaid 
reimbursable . 

2 . Drug Manufacturer Agrees to $200,000 Court Settlement 

A consent judgment was filed with a New York manufacturer and 
distributor of pharmaceuticals totaling $200,000. The defendant 
agreed to pay $150,000 in civil fines to the Commonwealth of 
Massachusetts and another $50,000 to sponsor a community service 
program which will benefit Medicaid recipients. The defendant 
offered a variety of vacation packages to promote the purchase of 
its products by pharmacies throughout the state. The company's 
promotional practices violated the anti-kickback provisions of 
the state Medicaid and health care laws. 

3 . Drug Company Pays 2000,000 to Settle Kickback Claims 

A civil settlement was reached with a national drug 
manufacturer over claims that its drug marketing program violated 
state Medicaid and anti-kickback laws. The company agreed to pay 
the Massachusetts Medicaid program $200,000 after having 
voluntarily discontinued the manner in which it marketed a 
product. The agreement signed concludes an investigation which 
found reasonable cause to believe that the company violated the 
state Medicaid and health insurance anti-kickback laws. At issue 
was a $35 fee provided to pharmacists, which allegedly amounted 
to an illegal kickback. 

4 . MFCU Reaches $405,000 Settlement Over Marketing Practices 

A $405,000 settlement was reached with a national drug 
manufacturer and two of its Massachusetts customers over claims 
that the companies violated Medicaid anti-kickback and state and 
federal discount statutes. In separate settlement agreements, a 
New Jersey manufacturer; and a Woburn pharmacy agreed to pay a 
total of $195,000 in cash to the state Medicaid program and 
another $200,000 in free pharmaceutical goods to be distributed 



to state Medicaid-insured residents. Another Massachusetts 
pharmacy paid $10,000 to settle similar MFCU claims. 

IV. NURSING HOME ENFORCEMENT 

1 . Consent Judgment Filed Against Nursing Home Owner 

A $16,550 civil consent judgment was filed in Suffolk Superior 
Court with a Jamaica Plain nursing home owner for alleged 
violations of state laws and regulations in the operation of the 
patients' personal needs allowance bank account. The owner is 
banned from operating any long-term care facility in the 
Commonwealth. The owner and operator of the Bradley Nursing 
Home, Jamaica Plain, entered into a judgment and settlement 
agreement which requires him to pay $13,550 directly to 13 former 
residents of the Bradley Nursing Home for alleged mismanagement 
of the residents' personal needs allowance bank account. 

2 . Former New Medico Accountant Sentenced in Theft Scheme 

A former accountant for the now-defunct New Medico Associates, 
Inc. was sentenced in Suffolk Superior Court to four years in the 
House of Correction after pleading guilty to multiple counts of 
larceny. Two other defendants also plead guilty and were each 
sentenced to jail time. The charges stem from an investigation 
into an embezzlement scheme totaling $240,000 from New medico, a 
Boston-based health care management company. 

3 . Former Fairhaven Attorney Found Guilty After Trial 

A Former Fairhaven Attorney was found guilty of 33 felony and 
misdemeanor counts involving nearly $40,000 by a Suffolk County 
Jury, following a week-long trial. The defendant was found 
guilty on two counts of larceny over $250; 13 counts of perjury; 
two counts of forgery; three counts of submitting false Medicaid 
claims on behalf of Gardner's Grove Nursing Home Inc., of 
Swansea; and four counts of making false representations to the 
Medicaid program on behalf of Center Green Rest Home, Inc., of 
Fairhaven. The defendant was sentenced to serve a suspended 
three to five year state prison sentence. 

4 . Nursing Home Owner Convicted of Stealing from Medicaid 

A Revere nursing home owner plead guilty to charges of 
Medicaid fraud that involved the theft of expensive food items 
from the nursing home. The defendant was sentenced to a 
suspended one year in the House of Correction. He was also 
sentenced to one-year of probation, and ordered that he pay 
$20,000 in restitution for the stolen food and a $12,500 fine. 
There was also a two-count civil complaint and settlement 
agreement which alleged the defendant wrongfully received 
$32,500 from Medicaid from January 1989 to December 1992. The 
defendant was ordered to pay Medicaid an additional $32,500. 



69 



V. PATIENT ABUSE /NEGLECT PROSECUTIONS 

1 . AG Issues Report on Nursing Home Patient Abuse 

A November, 1993 report showed that MFCU prosecutions of 
nursing home patient abuse cases more than doubled and the number 
of investigations increased more than 15 times since 1990. The 
report, entitled "Abuse, Neglect and Mistreatment in 
Massachusetts Nursing Homes: Enforcement and Prevention", was 
released at a conference on the prevention of nursing home 
patient abuse and neglect. Approximately 500 nursing home staff 
members and elder advocates attended the conference. 

2 . Lakeville Woman Charged with Patient Abuse in Wareham 

A Lakeville woman was charged in Wareham District Court with 
patient abuse involving the alleged abuse of a 30-year-old head 
injured patient. The defendant, a certified nurse-aide at the 
Greenery, Middleboro, was charged with one count of patient 
abuse. She was terminated by the Greenery five days after the 
alleged abuse took place. 

3 . Milton Woman Charged with Neglect 

A Milton woman was charged with criminal neglect and 
mistreatment of a 98-year-old resident of a Dedham nursing home 
as a result of an incident at the facility on January 29, 1993. 
The defendant was charged in Dedham District Court with a single 
count of patient neglect and mistreatment for an alleged incident 
while she was employed as a certified nurse-aide at Eastwood Care 
Center, Dedham. The defendant was terminated from the facility 
10 days after the alleged incident. 

4 . Jamaica Plain Man Admits to Patient Abuse 

A Jamaica Plain man admitted to sufficient facts in the West 
Roxbury District Court to patient abuse of a 77 -year-old male 
patient at a Boston nursing home. The defendant, admitted that 
there were sufficient facts for a guilty finding to one count of 
patient abuse. Judge Paul Murphy continued the case without a 
finding for one year. The Commonwealth had recommended that the 
defendant be found guilty and sentenced to 30 days in the House 
of Correction, suspended for one year, with conditions that he 
not be allowed in a nursing home. The defendant assaulted a 77- 
year-old male patient in June, 1993 while he was employed as a 
nurse's aide at Jamaica Towers Nursing Home, Boston. He 
allegedly forced the resident from his chair while twisting the 
resident's arm behind his back and forcing him onto an elevator. 
The defendant released the victim when he saw a social worker 
from the home approach. He also verbally assaulted the 
resident . 



5 . Bridgewater Woman Found Guilty of Abuse 

A Bridgewater woman was sentenced in Brockton District Court 
for patient abuse of a 69 -year-old man in the Forge Pond Nursing 
Home in East Bridgewater. The defendant admitted to one count of 
assault and battery and one count of patient abuse on July 30, 
1993. Brockton District Court Judge David Nagle entered a 
finding of guilty and sentenced her to probation for two years. 
On August 15, 1992, the defendant was the supervising nurse for 
the evening shift. She participated in tying the victim into his 
wheelchair, pouring various substances over his head and spraying 
shaving cream over his body. 

6 . Former Nursing Aide Admits to Assault & Battery 

A Former Chicopee nursing assistant admitted to sufficient 
facts to find her guilty of patient abuse and assault and battery 
in Chicopee District Court. The defendant allegedly assaulted 
two elderly residents of the Chicopee Municipal Home. 

7 . Former Nursing Home Aide Pleads Guilty to Patient Abuse 

A Brighton man plead guilty in Concord District Court to 
charges of patient abuse and indecent assault and battery. The 
defendant was ordered to serve two years of probation and he was 
ordered not to work in a long-term care facility during that 
period. The defendant worked as a nurse's aide at Mediplex of 
Lexington. Between March and May 1992, on three separate 
occasions, he improperly touched two elderly female residents. 

8 . Pittsfield Man Arraigned for Alleged Patient Abuse 

A Pittsfield man was charged in Great Barrington District 
Court for alleged patient abuse of three elderly residents of the 
Great Barrington Healthcare Facility. The defendant, employed as 
a certified nurses aide, allegedly engaged in a number of 
assaults. The defendant allegedly grabbed an 82-year-old man by 
the head and shook and taunted him. He also allegedly lifted an 
89-year-old female resident by the shoulders and roughly placed 
her in bed. MFCU investigators also allege that he provoked a 
92-year-old man into becoming combative, and then allegedly poked 
him, grabbed him by the wrist, and jerked him back and forth in 
his wheelchair. 

9 . East Bridgewater Woman Admits to Patient Abuse . 

An East Bridgewater woman admitted to sufficient facts to 
warrant a finding of guilty in Brockton District Court for 
abusing of a 70-year-old male patient at the Forge Pond Nursing 
Home in East Bridgewater. The defendant participated in tying a 
69-year old male into his wheelchair, and in pouring various 
substances over his head. She also wanted to photograph the 
victim with the substances on him. The defendant was sentenced 



to two years of probation and recommended that she lose her 
certification as a nurse's aide. 

10 . Medford Woman Admits to Patient Abuse in Lexington Home 

A Medford woman admitted to sufficient facts to warrant a 
finding of guilty in Concord District Court for patient abuse and 
neglect, following an incident involving the abuse of an 85-year- 
old male patient at the Mediplex Nursing Home in Lexington. The 
defendant admitted to a single count of patient abuse and 
neglect. She was ordered to serve one year probation. The 
defendant will also be forbidden from working with children or 
the elderly during that time. 

11 . Former Easthampton Aide Admits to Patient Abuse 

An Easthampton woman admitted to sufficient facts to warrant a 
finding of guilty in Northampton District Court on criminal 
neglect and abuse, and assault and battery charges for abusing a 
78-year-old nursing home resident. The defendant abused a female 
resident of the Pine Rest Nursing Home in Northampton. The 
defendant punched the elderly woman in the chest while assisting 
the resident. Over the strong objections of the Commonwealth the 
case was continued without a finding for two years and prohibited 
the defendant from volunteering or working for a long-term care 
facility during that time. 

12 . Worcester Aide Pleads Guilty Patient Abuse Charges 

The defendant admitted to sufficient facts in the Worcester 
Jury of Six on three counts of assault and battery, five counts 
of patient abuse and one civil rights violation. On diverse 
dates, the defendant struck two head-injured residents on the 
forehead with her hand and on one occasion used a racial slur 
against the resident during the assault. The judge found the 
defendant guilty, placed her on probation for two years and 
ordered her to perform 150 hours of community service. 

13 . Former Nursing Assistant Admits to Patient Abuse 

A former nursing assistant at a long-term care facility 
located in Holyoke admitted to sufficient facts to warrant a 
guilty finding on patient abuse and assault and battery charges. 
The defendant admitted to sufficient facts on one count each of 
assault and battery and patient abuse at the Chapel Hill Nursing 
Home. The defendant admitted to slapping a 78-year-old 
moderately retarded resident at the facility in the back of the 
head when the resident resisted getting out of bed. She further 
admitted punching the woman in the back. She was sentenced to 
one year probation and ordered not to work as a nursing assistant 
in any health care facility during the term of probation. 



14 . Former Nurse's Aide Arraigned for Alleged Abuse 

A Northampton woman with was charged with criminal abuse and 
assault and battery for allegedly abusing an 87-year- old 
resident of an Easthampton nursing home. The defendant allegedly 
roughly handled the female resident of the Hampshire Manor 
Nursing Home. The alleged action resulted in bruising to the 
resident's arm. She was terminated when Hampshire Manor became 
aware of the allegations. 

15 . Worcester Phlebotomist Admits to Patient Abuse 

A Worcester woman admitted to abuse charges in Ayer District 
Court on a complaint alleging patient abuse and assault and 
battery at Woodford Nursing Home of Ayer. The defendant was 
assigned to obtain blood samples from a 95-year-old female 
resident. The resident repeatedly indicated to the defendant 
that she did not want the procedure performed. The defendant 
forcefully withdrew the resident's blood. The matter was 
continued without a finding for one year and the defendant was 
ordered not to seek or accept employment with the elderly. 

16 . Salem Woman Placed on Pretrial Probation 

The defendant was placed on pretrial probation for two years 
and ordered to sign an agreement that she will not seek or accept 
employment in a nursing home. The defendant allegedly hit a 77- 
year-old male resident of the Life Care Center in Lynn. 
According to witnesses, she was feeding the resident who became 
disruptive. When, she allegedly threatened to take away his 
breakfast, he grabbed her hand. The defendant then allegedly 
became angry and struck the resident two times on the head. 

17 . Former Nurse's Aide Admits to Abuse in Webster 

A former nurse's aide at a Webster nursing home admitted to 
sufficient facts in Dudley District Court on charges of patient 
abuse. The defendant punched the hand of an 85-year-old female 
resident of the Webster Manor Long Term Care Facility, three 
times after she and co-workers assisted the resident to her room. 
The case was continued without a finding for six months, with 
probation. 

18 . Brockton Woman Pleads Guilty to Patient Abuse 

A Brockton woman plead guilty to single counts of patient 
abuse and assault and battery in Quincy District Court. The 
guilty pleas come after an investigation which looked into 
allegations that the defendant slapped and pushed two Alzheimer 
patients at the Braintree Manor Nursing Home. The defendant 
pleaded guilty to slapping an 85-year-old female patient twice on 
the buttocks, and slapping the face of an 89-year-old male 
resident two days later before pushing his face into a pillow. 
He was sentenced to one year of probation. 



73 



19 . Tewksbury Man Indicted Indecent Assault & Battery 

A Tewksbury man was indicted by a Middlesex County Grand Jury 
for the alleged patient abuse and indecent assault and battery of 
a 68-year-old mentally retarded male resident of the Country View 
Nursing Home in Billerica. The defendant was indicted on one 
count of patient abuse and indecent assault and battery for the 
alleged sexual assault. 

2 . New Bedford Man Admits to Sufficient Facts for Abuse 

A New Bedford man admitted to sufficient facts in New Bedford 
District Court on one count of patient abuse. The defendant was 
charged with striking a 91-year-old female resident across the 
face at the Sassaguin Nursing Home in New Bedford. The case was 
continued without a finding for six months. 

21 . Attleboro Woman Admits to Nursing Home Abuse 

An Attleboro woman admitted to sufficient facts to warrant a 
finding of guilty in Dedham Jury of Six on charges of patient 
abuse and assault and battery. The defendant stuffed a damp 
washcloth into an 84-year-old Plainville Nursing Home resident's 
mouth, wet the cloth again and then threw it at the victim as she 
lay in bed. The defendant also harassed the resident by placing 
a nightlight with a hot bulb within six inches of her face during 
the incident. The case was continued for one year with 
probation. 

22 . Lowell Woman Admits to Assault and Battery 

A Lowell woman admitted to sufficient facts to warrant a 
guilty finding for assault and battery and patient abuse at the 
Palm Manor Nursing Home in Chelmsford. She was charged with 
three counts of assault and battery, and three counts of patient 
abuse. The defendant a nurses aide choked and kicked three 
female residents, all in their 70 's on several occasions. She 
also forced a water hose into the mouth of one of the residents. 
The case was continued without a finding for three years. As a 
condition of her probation, she cannot work in a nursing home and 
must be evaluated by the probation department to determine her 
counseling needs . 



FAMILY AND COMMUNITY CRIMES BUREAU 

The Family and Community Crimes Bureau is responsible for 
policy and program development in four subject areas: children 
and youth; elders and persons with disabilities; family violence; 
and victims of crime. In addition, the Victim Compensation and 
Assistance Division, which oversees the provision of compensation 
to victims of violent crime, comes under the supervision of the 
Family and Community Crimes Bureau. 

A. THE ELDERLY 

The Attorney General has made protection of elders a top 
priority. For this reason, the Family and Community Crimes 
Bureau has continued its focus on elder abuse and neglect, 
consumer fraud and financial exploitation. 

In FY' 94, the Elderly Protection Project, based in the Family 
and Community Crimes Bureau, provided comprehensive, statewide 
training to improve the law enforcement community's response to 
abuse, neglect and financial exploitation of elders. This 
project, funded through a grant from the Massachusetts Committee 
on Criminal Justice, received national recognition from the 
Bureau of Justice Assistance, United States Department of 
Justice, as a national model. 

These trainings are geared to three different levels of 
expertise: (1) introductory training for recruits; (2) basic in- 
service training for veteran officers; and (3) two-day advanced 
training, presented in conjunction with adult protective service 
workers. During the past year, the Project presented sixteen of 
the advanced law enforcement trainings around the state. The 
trainings involved 470 police officers from over 200 departments, 
63 protective service workers from all of the 27 protective 
service agencies in Massachusetts, and 38 other professionals 
from various agencies. The Project also trained 829 police 
recruits at 12 different training academies. The second draft 
of the Attorney General's Revised Long Term Care Regulations was 
released in May, 1994. These regulations have not been amended 
since they were first promulgated in 1978. This draft included 
substantive changes in the following areas: non-discriminatory 
access to long term care; discharge and transfer; inclusion of 
the chronic care and rehabilitative hospitals; and conformity 
with the federal law called "OBRA." These regulations were 
developed by the Consumer Protection Division in collaboration 
with the Family and Community Crimes Bureau. 

The Attorney General also remained active in legislative 
initiatives to develop "assisted living" for elders, to respond 
to the need for a supportive living environment for frail elders 
to allow them to age in place with dignity and independence. The 
Family and Community Crimes Bureau has continued to work 
cooperatively with private developers, elder advocates, and state 
agency representatives to secure passage of legislation which 



will encourage development of assisted living facilities while at 
the same time providing important consumer safeguards. In 
addition, the Attorney General filed and advocated for 
legislation toughening elder abuse laws and sanctioning elder 
neglect . 

The Family and Community Crimes Bureau filed a petition in the 
Middlesex Probate Court to vacate the will of an elderly woman, 
signed two days after a psychiatrist had deemed her incompetent 
to write a will, which left her entire estate to a younger non- 
relative whom she had known only briefly. The petition alleges 
that the respondent failed to make the Attorney General a party 
to the probate of the will, as required by law when it appears 
that the person writing the will had no relatives, and that the 
respondent's failure to advise the Probate Court of the elderly 
woman ' s incompetence was a fraud upon the court . 

Bureau staff also participated on steering committees for 
several national projects undertaken to provide better services 
to and protection of the elderly. 

Finally, the Elder and Disabled Issues Task Force continued to 
meet throughout the year to address issues such as guardianship 
reform, national health care proposals as they affect the 
elderly, and other legislation of particular interest to the 
elderly. 

B. FAMILY VIOLENCE 

The Attorney General continued to develop programs and 
policies to comprehensively address the problem of family 
violence . 

In July, 1993, as part of the Attorney General's health care 
and domestic violence initiatives, the Family and Community 
Crimes Bureau prepared and presented a comprehensive training on 
the early identification, assessment and treatment of domestic 
violence to all staff of the Dimock Community Health Center in 
Boston. The training, which involved legal, medical and social 
service professionals, focused on some of the most critical legal 
and medical issues in domestic violence prevention and protection 
efforts, such as ways of interviewing and assessing family 
violence victims in a health care setting, the impact of domestic 
violence on children, and legal measures to protect women and 
their children. This training for health care professionals will 
be replicated at the Bowdoin Street Health Center in the winter 
of 1994, and will be videotaped and disseminated to other health 
care and social service agencies. 

In addition, the Bureau participated in numerous other 
trainings of health care professionals on domestic violence 
issues. The Bureau also presented the Attorney General's third 
annual day-long Domestic Violence Training Conference for police. 
Approximately 300 police officers attended the training. The 



76 



conference featured presentations on the stalking law, 
interjurisdictional arrest, injury dociomentation, special 
problems faced by immigrants who are victims of domestic 
violence, and workshops focused on specific techniques and legal 
issues involved in family violence cases. In addition, the 
Bureau Chief participated as a faculty member in all sessions of 
the statewide training on domestic violence for judicial system 
personnel conducted by the Trial Court, and as an active member 
and Legislative Committee Co-Chair of the Governor's Domestic 
Violence Council. 

The Family and Community Crimes Bureau prepared a report 
summarizing the activities and accomplishments of the District 
Attorneys' Domestic Violence Prosecution Units. The report 
highlighted the challenges prosecutors and advocates faced in 
implementing different components of their domestic violence 
programs, the strategies they utilized to overcome these 
obstacles, and the accomplishments they achieved. 

Finally, the Bureau drafted and the Attorney General filed 
several pieces of legislation aimed at strengthening and making 
technical corrections to domestic violence laws in the 
Commonwealth and was active in the drafting and passage of 
legislation to remove firearms from batterers. 

C. CHILDREN AND YOUTH 

The School Superintendent's Advisory Group, chaired by the 
Attorney General and staffed by the Family and Community Crimes 
Bureau, continued to meet on a quarterly basis. This Group 
provided a forum for discussion of issues such as education 
reform, bilingual education, school violence and expulsion 
policies. Its discussions contributed to the input provided to 
legislative and executive agencies on these issues. 

The Attorney General's Office continued its effort to 
establish collaborative relationships among the Department of 
Education, local school districts and local law enforcement 
officials. In April, 1994, the Bureau presented a statewide 
conference on the issues of school safety and cooperation between 
local school officials and law enforcement on substance abuse and 
violence prevention matters. 

The Children's Issues Group, staffed by the Family and 
Community Crimes and Government Bureaus, continued to review 
issues of concern to children's advocates to attempt to achieve 
resolution short of litigation and to foster a better 
understanding between children's advocates and government. 

Bureau staff were also active in reform efforts underway in 
the areas of expulsion from school of disruptive students and 
study of alternative education programs. 



In the area of juvenile justice, the Family and Community 
Crimes Bureau drafted and filed several bills tightening laws 
affecting serious juvenile offenders. Finally, the Family and 
Community Crimes Bureau presented the Attorney General's second 
training program for campus police and administrators. The 
conference included presentations on campus police powers and 
responsibilities; campus liability; Criminal Offender Record 
Information (CORI) and its relationship to school discipline; 
drug and alcohol abuse; date rape; and hate crimes. 

D. VICTIM ISSUES 

The Attorney General continued to personally chair the Victim 
and Witness Assistance Board which oversees the Massachusetts 
Office for Victim Assistance (MOVA) . MOVA had previously 
dramatically downsized its staff, consolidated its 
responsibilities, streamlined its data information systems, and 
redesigned its oversight of the Victim Bill of Rights and G.L. c. 
258B programs, including the Victim Witness Assistance Fund, 
under the leadership of its Executive Director, Heidi Urich. 

In addition to its continued responsibilities for 
dissemination and oversight of VOCA grants to 34 community-based 
agencies, this year marked MOVA's presentation of its largest 
Victim Rights Conference, attended by over 500 victim rights 
advocates and other social services professionals, in April, 
1994. The conference focused on current issues including 
domestic violence, sexual abuse and victim backlash, gun control, 
and the victim's role in the criminal justice system. 

With support from the Family and Community Crimes Bureau, MOVA 
drafted and filed major victim rights legislation which received 
a favorable committee report, and succeeded in gaining passage of 
reforms to the Victim Witness Assessment statute to increase the 
collection of victim witness fees. 

MOVA also conducted a year-long, four-stage training program 
to develop additional Community Crisis Response Teams; co- 
sponsored training on homicide cases for victim witness 
advocates; provided training on civil remedies and monetary 
resources available for victims; supported establishment of a 
Domestic Violence Civil Court Advocates program; and provided 
input on development of the new one-trial rules in the District 
Court. 



78 



VICTIM COMPENSATION AND ASSISTANCE DIVISION 

On January 4, 1994, the Legislature enacted G.L. c. 258C, 
entitled "Compensation of Victims of Violent Crime." This new 
law, which went into effect on April 14, 1994, significantly 
reforms the process by which victims of violent crime receive 
financial compensation for medical, funeral and mental health 
counseling expenses, an well as for lost wages and loss of 
financial support. Under the old law, G.L. c. 258A, victims were 
required to go through a long and often adversarial court process 
in order to obtain compensation. The new law converts this 
court-based process to an administrative process in which all 
claims are filed, investigated and approved for payment by the 
victim compensation and Assistance Division. Victims who 
disagree with the decision on their claim for compensation have 
the right to administrative review, as well as judicial review, 
of the Program Director's decisions. 

Recognizing the need for reform, the Division strongly 
advocated in support of G.L. C. 258C. As a result of this new 
legislation, the Division anticipates that decisions on claims 
for compensation will be made in a matter of months rather than a 
matter of years, as was the case under the old law. By removing 
the compensation system from the already overburdened courts, the 
Division also anticipates that the vast majority of victims will 
avoid the revictimization of having to return to court in order 
to obtain compensation for their out-of-pocket crime related 
expenses . 

All Claims filed before April 14, 1994, will continue to be 
adjudicated under the court-based system. In 1993, the Division 
received 911 court-based claims from victims of violent crime. 
It closed 1231 court-based claims from representing a twenty-five 
percent increase in the closure rate from the previous year. 
Payments to victims totaled $3,358,740.57. This amount 
represents a seventeen percent increase over the previous year, 
and the largest expenditure of funds to crime victims in the 
Division's history. Despite its increased efficiency in closing 
cases, the Division maintains a case load of approximately 2,059 
cases which must be disposed of through the court-based system. 
In order to expedite the disposal of these cases, the Division 
implemented streamlined discovery and verification procedures, 
and provided additional district court trial and appellate 
training to Division attorneys. Legal and investigative interns 
were brought into the Division throughout the year in order to 
assist with the disposal of court-based cases. 

In the last half of the fiscal year, significant efforts were 
directed toward the implementation of the new law. Application 
forms and explanatory brochures were created and distributed to 
law enforcement agencies throughout the Commonwealth. Outreach 
and training efforts were directed toward advocacy groups, court 
advocate programs, district attorney's offices, and services 
providers. Draft regulations were issued and public hearings 



79 



held in order to receive broad input on Division regulations and 
procedures. The Division also began the critical process of 
implementing a computerized Claims tracking system in order to 
manage an anticipated increase in the number of claims. 

Claims received under the new system totaled 150. By year 
end, the Division was beginning to issue decisions on these 
claims, and it appeared that most claims would be resolved within 
three to six months of receipt of the claim. Expected financial 
pressures on the victim compensation fund led the Division to 
undertake a careful review of cost-cutting measures. In order to 
ensure that all other avenues of compensation are fully exhausted 
before victim compensation is awarded. Division staff received 
comprehensive training in the broad range of public and private 
benefit programs. Specific efforts were directed toward ensuring 
that eligible victims apply for hospital-based "free care" (G.L. 
c. 118F) prior to obtaining victim compensation. In 
conjunction with its reform efforts, the Division undertook to 
coordinate and host, on a quarterly basis, regional meetings of 
crime victim compensation programs, most of which operate under 
administrative systems. Directors and representatives of the 
Maine, Vermont, New Hampshire, Connecticut and Rhode Island 
compensation programs met in Boston to receive expert training 
and provide peer problem solving around topics such as 
investigative techniques, mental health counseling, and outreach. 
The Division also assisted in planning and coordinating the 
annual training conference of the National Association of Crime 
victim Compensation Boards which will be hold in Boston in 
November 19 94. 

Finally, the Division continued to provide a range of services 
and assistance to victims in dealing with the financial impact of 
crime, including creditor intercession services, and assistance 
in locating service providers. The provision of compassionate 
services to crime victims remained the Division's top priority. 
Massachusetts hospitals to assess compliance with free care pool 
notification regulations. The third project set out to improve 
consumer information and awareness of health care insurance 
options. The group identified a series of questions which every 
consumer should ask prior to purchasing a health insurance 
policy. 



PUBLIC PROTECTION BUREAU 

The Public Protection Bureau (PPB) is comprised of six 
divisions: Civil Rights, Consumer Protection and Antitrust, 
Public Charities, Regulated Industries, Environmental Protection, 
the PPB chief Prosecutor's Unit, and the Civil Investigations 
Division. Additionally, the Consumer Protection Division 
contains the Consumer Complaint and Information Section and also 
oversees the local consiomer fund which provides grants to local 
community groups to mediate and resolve consumer complaints at 
the local level . 

Bureau personnel also coordinate and staff the Attorney 
General's innovative program to reduce youth violence, SCORE- 
Student Conflict Resolution Experts. This program is a school- 
based mediation program using trained student mediators to 
resolve disputes among their peers and prevent them from 
escalating into violence. This unique program has been 
recognized nationally for is effectiveness in preventing violence 
and the Attorney General is committed to expanding it to every 
school in the Commonwealth. 

The role of the divisions in the Public Protection Bureau is 
to bring affirmative litigation on behalf of the Commonwealth of 
Massachusetts, its citizens and businesses in the areas listed 
above. PPB also has brought certain criminal cases in the 
consiamer and health care fraud areas. 

The Public Protection Bureau also is responsible for the 
development and implementation of policies and initiatives 
dealing with health care and elder issues. Some of the 
initiatives undertaken this year are described below: 

Health Care Initiatives and Cases 

In 1994, the Public Protection Bureau continued to be actively 
involved in many areas of health care litigation, legislation and 
policy initiatives. In addition to bringing numerous cases under 
the Attorney General's law enforcement powers and proposing 
health insurance market reform and anti-fraud legislation, the 
Attorney General undertook other initiatives to promote access to 
health care for all citizens of the Commonwealth. 

The Attorney General's Health Care Advisory Group continued to 
meet and to focus on four initiatives. First, as part of the 
focus on responsibilities of nonprofit hospitals, providers and 
insurers to meet health care needs of the communities they serve, 
the Attorney General developed Community Benefits Guidelines for 
Nonprofit Acute Care Hospitals in the Commonwealth. A second 
initiative was the "Consumer Education and Awareness Campaign to 
emphasize the availability of and access to the Massachusetts 
free care pool. This group issued a "Report on Compliance with 
Free Health Care Disclosure Laws" which summarized the results of 
a survey undertaken by the Office of the Attorney General, in 



which the office surveyed insurance policy in order to be better 
informed. A pamphlet titled Choosing a Health Plan; the 10 Most 
Important Questions You Should Ask is now available to consumers. 
Fourth, the Attorney General continues to develop legislation to 
encourage insurance market reform and the development of health 
insurance purchasing cooperatives in Massachusetts. 

During this past year, Attorney General Harshbarger served for 
the second consecutive year as the Chairman of the Health Care 
Task Force of the National Association of Attorneys General. 
Staff from the Public Protection Bureau continued to coordinate 
this role on behalf of the Attorney General. Some of the 
initiatives undertaken by the NAAG Health Care Task Force this 
year under the leadership of Attorney General Harshbarger were: 

- A survey of all attorneys general offices on 
health care activities; 

- Letters to key members of Congress urging 
universal coverage; 

- Support of all payor fraud legislation; 

- A memorandum that describes a series of impacts 
and issues concerning the effects of the Clinton 
Health Security Act on various areas of state law 
and government . 

Bureau staff have spoken for and represented the Attorney 
General on various health care panels and conferences. 

The Public Protection Bureau has also continued its efforts in 
more traditional areas implicated by the health care system. The 
Consumer Protection/Antitrust Division has brought actions 
against persons responsible for operating scams in the health 
care products business. The Bureau's activities also extend to 
representing consumers' interests in rate hearings on non-group 
and medex rates, employees who fail to remit premiums paid by 
employers, fraudulent home health care providers and obtaining 
protective receiverships over financially troubled nursing homes. 



82 



CONSUMER PROTECTION AND ANTITRUST DIVISION 

The Consumer Protection and Antitrust Division enforces 
Massachusetts General Law chapters 93 and 93A as well as other 
state and federal consumer protection and antitrust statutes. 
The Division's case load primarily consists of actions affecting 
large numbers of vulnerable consumers who have been harmed by 
illegal activities, particularly fraud. Additionally, the 
Division seeks to protect and promote competition so that 
consumers are offered goods and services of higher quality at 
lower prices. Other efforts include regulatory and legislative 
activities, participating in consumer outreach, and mediating 
individual complaints through the Consumer Complaint Section and 
the Local Consumer Programs . 

In fiscal year 1994, the Division was responsible for 
obtaining the largest recovery from a hospital (over $1,500,000 
in University Hospital ) and largest recovery in a used car case 
(over $450,000 in Visone ) . Other significant recoveries include 
$378,000 in Jordan Marsh , $250,000 in Direct American Marketers , 
$240,000 in Equifax and $200,000 in Payco . In addition, the 
Division was responsible for promulgating the nation's first 
hospital merger guidelines, and the Commonwealth's first survey 
of compliance with Massachusetts' sale of cigarettes to minors 
law. 

MONEY RECOVERED 

CIVIL PENALTIES /ATTORNEYS' FEES/COSTS $1 , 079 , 766 
CONSUMER RESTITUTION $2,390,896 
LOCAL CONSUMER AID FUND $ 414,000 



COMPLAINT SECTION TOTALS: 

Direct Refunds to Consumers $ 89,294 

Amount Saved Through Settlements $ 113,764 

Amount Received in Goods & Services $ 197,051 

OTHER : 

Keds $134,124 to charities 

Loewen Group $ 15,000 to charities 

Robinson $ 17,500 for lead contractor 

and inspector training 
Visone $180,000 in vans for the 

Massachusetts Council on Aging 
First Investors $100,000 for consumer education 

Gordon Brothers $ 50,000 to Greater Boston 

Legal Services 
Designers Clothing Limited 100 suits to homeless shelter 
Delaware v. New York $23,000,000 to the Commonwealth 



83 



In addition, $6,000,000 in consumer benefits and reduced 
payments were also made possible through the Dime Savings Bank 
agreement, and $32,000,000 in restitution was made available 
nationwide in the First Investors settlement. 

ANTITRUST 

Comm., et al . v. Keds Corp. 

On September 27, 1993, the Office, in conjunction with 40 
other states, announced a $7.2 million settlement with the Keds 
Corporation arising from an alleged nationwide scheme to set 
prices on six styles of sports shoes for women and to prevent 
discounting by retailers. Purchasers allegedly paid an average 
of $1 - $1.25 more than they would have had the company not 
imposed price-fixing. 

Massachusetts' $134,124 share of the settlement was presented 
to five charities to be used in programs that benefit women: The 
Women's Sports Foundation, The American Cancer Society, The 
American Red Cross, the Boys and Girls Club of America and The 
Better Home Foundation. 

Comm. V. Loewen Group International, Inc., et al . 

On February 7, 1994, the Division entered into a consent 
decree in federal District Court for the District of 
Massachusetts with Loewen Group International, Inc., a Canadian 
corporation, and two Massachusetts subsidiaries, Loewen Cape Cod 
Holdings (1991), Inc. and Doan Beale & Ames, Inc., to resolve 
antitrust concerns stemming from the companies' acquisition of 
funeral homes in Barnstable County. 

Pursuant to the consent decree, Loewen is required to divest 
itself of the assets of three Barnstable County funeral homes 
within 30 months of the entry of the decree. Additionally, 
Loewen has agreed to contribute $15,000 over the next two years 
to charitable organizations serving the needs of elderly and low- 
income residents of Barnstable County, and $20,000 towards the 
Commonwealth's costs in this matter. 

In the Matter of Cape Ann & Northeast Health Systems, Inc. 

On June 20, 1994, the Division entered into an assurance of 
discontinuance that resolved antitrust concerns regarding the 
proposed merger between Beverly Hospital and Addison-Gilbert 
Hospital . 

Beverly Hospital is the closest competitive alternative 
provider of hospital services to Addison-Gilbert Hospital, 
located on the Cape Ann peninsula. There was concern that 
elimination, through the merger, of this competitive alternative 
might open the way for price increases at Addison-Gilbert. To 
address these concerns, the hospitals have agreed not to raise 
charges for services at Addison-Gilbert to a level higher than 
those charged at Beverly Hospital. The agreement is in effect 
for five years. 



Multistate Insurance Antitrust Litigation 

In this litigation, the Commonwealth and 19 other states sued 
leading domestic and foreign insurers, reinsurers and others for 
antitrust violations. The complaints allege that the defendants 
engaged in an illegal boycott to remove certain forms of 
commercial general liability ("CGL") insurance from the market. 
CGL insurance covers third party property and personal injury 
claims. In 1989, the U.S. District Court for the Northern 
District of California dismissed the complaints for failure to 
state a claim upon which relief could be granted, and in 1991 the 
Ninth Circuit Court of Appeals reversed the dismissal . In a 5 to 
4 vote the U.S. Supreme Court substantially affirmed the judgment 
of the Ninth Circuit and allowed the case to proceed at the 
District Court level. 

In fiscal year 1994, the Division and the other plaintiff 
states have commenced extensive discovery and been engaged in the 
review of the voluminous document production in preparation for 
trial. 

AUTOMOBILE 

Used Car Lemon Law Cases 

Comm. V. Michael Raymond d/b/a M&M Auto Sales, Inc. 

Comm. V. Charles Martineau d/b/a Martineau Enterprises 

Comm. V. Paul Ray 

Comm. V. David Unis 

Comm. V. Bernard Joseph & Lyonel Manigat d/b/a Professional 

Auto Sales 

Comm. V. Frank DeCoster 

Comm. V. Marjorie Venditti 

Comm. V. Michael Raymond 

Comm. V. Manco, Industries, Inc. d/b/a Ford Street Motors 

Comm. V. Scott Pare 

Comm. V. King of Bay Street, Inc. 

On February 17, 1994 the Division filed lawsuits charging the 
following used car dealers with failing to pay arbitration awards 
pursuant to the Massachusetts Used Car Warranty Law: Michael 
Raymond, owner and operator of M&M Auto Sales, Inc., located in 
Tyngsborough; Charles Martineau, owner and operator of Martineau 
Enterprises, located in Easton; Paul Ray, owner and operator of 
Paul's Auto Sales, located in Blackstone; and Bernard Joseph and 
Lyonel Manigat who owned and operated Professional Auto Sales, in 
Hyde Park Ave., Boston. The complaints seek to enforce the 
arbitrators' awards and to restrain the defendants from failing 
to comply with the provisions of the "Used Car Lemon Law" in the 
future . 

On March 23, 1994, the Division filed suit against Frank 
DeCoster, who owned and operated Pulaski Boulevard Auto Sales, 
located in Bellingham, for failing to abide by an arbitrator's 



85 



order to repurchase a vehicle from a Massachusetts consumer for 
$6,712. 

On April 6, 1994, a consent judgment was filed in Suffolk 
Superior Court with Michael Raymond, who owned and operated M&M 
Auto Sales, Inc., located in Lowell. The consent judgment 
enjoins Mr. Raymond from failing to comply with the "Used Car 
Lemon Law" in the future and requires him to pay $250 in civil 
penalties and $500 in restitution to the harmed consumer. 

Also on April 6, 1994, the Division collected $1,000 in 
penalties against Marjorie Venditti, the owner and operator of 
Mystic Auto Wholesale, located in Somerville. Venditti paid the 
$1,000 in civil penalties towards a default judgment which was 
entered in Middlesex Superior Court on April 8, 1993. 

On April 28, 1994, the Division filed a consent judgment in 
Plymouth Superior Court with Manco Industries, Inc., d/b/a Ford 
Street Motors, located in Brockton, and its treasurer, Thomas 
Mann. The consent judgment enjoins Manco Industries, Inc. and 
Mann from failing to comply with the Used Car Lemon Law in the 
future, and requires them to pay $350 in civil penalties and 
$1,400 in restitution to harmed consumers. 

On May 17, 1994, the Division filed a lawsuit in Suffolk 
Superior Court against Scott Pare, a Boston-based car dealer. 
Pare sold a car to an individual in April of 1993. When the car 
turned out to be a "lemon," an arbitrator ordered the defendant 
to repurchase the vehicle in September of 1993. The complaint 
seeks to enforce the arbitrator's award and restrain the 
defendant from failing to comply with the provisions of the Used 
Car Lemon Law in the future . 

On May 31, 1994, the Division resolved two lawsuits with used 
car dealers who failed to pay arbitration awards as required in 
the state's used car "lemon law." 

A consent judgment was filed in Hampden Superior Court with 
the King of Bay Street, Inc., Springfield. The consumer bought a 
car in May of 1993 from the defendant which was a "lemon." The 
judgment requires the King of Bay Street, which is owned and 
operated by David LaGuercia, to comply with an arbitrator's 
decision and repurchase the consumers car for $3,069. The 
judgment prohibits the dealership from failing to comply with the 
Used Car Lemon Law in the future. 

In the other unrelated case, a consent judgment was filed in 
Suffolk Superior Court with David Unis, who owned and operated 
the Private Party Used Car Company, in East Boston. The victim 
in this case brought a car in October of 1991 which turned out to 
be a "lemon." Unis was ordered to repurchase the car for $2,600. 
The judgment requires Unis to pay $150 in civil penalties, pay to 
repurchase the car, and prohibits him from violating the Used Car 
Lemon Law in the future. 



86 



Unfair and Deceptive Automobile Practices 

Comm. V. Midway Nissan Jeep-Eagle & Isuzu, Inc. 

On September 27, 1993, the Division obtained a consent 
judgment ordering Midway Nissan Jeep-Eagle & Isuzu, Inc., of 
Framingham, to pay $3,500 in civil penalties and costs for false 
advertising earlier in 1993 and ordering future compliance with 
the Massachusetts Consumer Protection Act. 

Midway advertised 'sale prices' next to each description of 
vehicles for sale. The alleged 'sale prices' were printed in 
large numerals with an 'asterisk' next to each price. The 
corresponding asterisk and description disclosed, in extremely 
small print, that the 'sale price' actually included a $2,000 
downpayment . 

Comm. V. Visone Motors, Inc., et al . 



On November 30, 1993, the Division entered into a consent 
judgment with Visone Motors, Inc., of Saugus, and other 
defendants that required the defendants to pay more than a half- 
million dollars in restitution to consumers, penalties, and 
costs. In its complaint, the Division alleged that Visone Motors 
misled consumers regarding whether they were buying or leasing a 
vehicle; misrepresented that vehicles had been prepped prior to 
delivery, when the vehicles were in poor condition; failed to 
repair vehicles and honor warranties; and aggressively 
repossessed vehicles from consumers who withheld payments because 
of complaints about the condition of the vehicles. 

Under the consent judgment, Visone is required to offer a fair 
and reasonable settlement to each of the approximately 150 
consumers who have complained to the Attorney General's office. 
If settlement is not reached, then a neutral third party selected 
by the Attorney General will review the consumers' complaints and 
propose a resolution that Visone Motors is obliged to implement. 
The consent judgment also requires Visone Motors to make $450,000 
in other payments. These include $230,000 in civil penalties, 
$40,000 to the Local Consumer Aid Fund and $180,000 for the 
purchase of 12 new vans to be donated to the Massachusetts 
Association of Councils on Aging. 

Comm. V. Sunshine Daily Rentals Inc., et al . 

On November 29, 1993 the Division filed suit in Suffolk 
Superior Court against William E. Broadbent, who is doing 
business as Sunshine Daily Rental, Inc. and Statewide Leasing, 
Inc.; Sunshine Daily Rentals, Inc.; The Auto Group, Ltd.; Auto 
Rent -Auto Lease of New England, Inc.; and Statewide Leasing, 
Inc., for allegedly violating the Commonwealth's consumer 
protection laws in the rental, leasing and sale of motor 
vehicles . 



87 



The Commonwealth alleged that the defendants violated numerous 
consumer protection regulations by misrepresenting the daily 
rental rate of rental motor vehicles; imposing undisclosed 
additional charges for rental motor vehicles; charging consumers 
for nonexistent damage to rental motor vehicles; making 
inappropriate charges to consumers' credit cards; misrepresenting 
the condition of motor vehicles for lease and sale; and engaging 
in as variety of additional unfair and deceptive business 
practices. Approximately 123 victims have alleged over $65,000 
in monetary damages . 

Comm. V. M.J.C. Enterprises d/b/a Grand Prix Auto Sales 

On February 8, 1994, the Division filed suit against M.J.C. 
Enterprises d/b/a Grand Prix Auto Sales, and Grand Prix's owner 
and president, Mark Colangelo. The Commonwealth alleged that the 
defendants misled consumers about the mechanical fitness of cars 
to be sold; mislead consumers about the title status and 
ownership history of the cars to be sold; failed to deliver the 
car's title to the purchaser on the day the car was delivered; 
misled consumers about the length of time it would take to 
perform repairs on cars; and charged customers for repairs which 
had not actually been performed. 

Comm. V. Robert Spigel d/b/a The Car Palace 

Also on February 8, 1994, the Division filed suit against 
Robert Spigel d/b/a Car Palace, located in Seekonk. The 
Commonwealth alleged Spigel violated the Massachusetts Consumer 
Protection Act by misrepresenting to consumers the repair history 
of automobiles, failing to disclose to consumers the status of 
automobiles as salvaged vehicles and failing to make a number of 
required disclosures in the purchase and sale agreements used by 
the dealership. The Commonwealth seeks restitution for affected 
consumers, injunctive relief and civil penalties. 

Comm. V. Guaranteed Auto Credit, Inc. 

On April 1, 1994, the Division filed a $93,000 consent 
judgment in Suffolk Superior Court against Guaranteed Auto 
Credit, Inc., located in North Attleboro, and its owner and 
president, Charles LaBonte. The Commonwealth alleged that the 
defendants used unfair and deceptive practices in the advertising 
and leasing of automobiles to low- income consumers. The 
Commonwealth alleged that Guaranteed violated the Massachusetts 
Consumer Protection Act and the Attorney General's Debt 
Collection regulations in the collection of leasing debts from 
consumers . 

The consent judgment enjoins Guaranteed and LaBonte from 
employing unfair or deceptive practices in the advertising and 
leasing of automobiles and in the collection of debts from 
consumers. It also requires the payment of approximately $18,000 
in restitution to consumers with outstanding complaints against 
Guaranteed, $25,000 to the Local Consumer Aid Fund and $50,000 in 
penalties to the Commonwealth. 



Coinin. V. South Shore Volvo 

On April 8, 1994, the Division entered into a consent judgment 
with South Shore Volvo for allegedly using misleading automobile 
advertisements. The consent decree enjoins the defendant from 
advertising a warranty as free when consumers must pay more for a 
vehicle if they opt for the warranty, advertising prices for 
vehicles that do not include document preparation charges, and 
failing to clearly disclose that consumers must pay an additional 
amount to purchase a vehicle at an advertised price. South Shore 
Volvo was also required to pay $5,000 in civil penalties to the 
Commonwealth. 

Comm. V. Victory Dodge, Inc. 

Also on April 8, 1994, the Division entered into a consent 
judgment with Victory Dodge, Inc., Victory Ford, Inc., and 
Concord Chrysler-Plymouth, Inc. for allegedly using misleading 
advertisements in the sale and lease of automobiles. The 
Commonwealth alleged that the defendants had failed to disclose 
sale expiration dates; advertised rebates without clearly 
disclosing that they were available only to a specific class of 
consumers; failed to clearly disclose that consumers must pay and 
additional amount to purchase a vehicle at an advertised price; 
and advertised a monthly lease rate without clearly disclosing 
that consumers must make a sizable downpayment to obtain that 
rate. Pursuant to the consent decree, the defendants are 
enjoined from engaging in the alleged acts and are required to 
pay $2,500 in civil penalties and $2,500 to the Local Consumer 
Aid Fund. 

Comm. V. Chambers Motorcars 

On April 11, 1994, the Division entered into a consent 
judgment with a Somerville-based automobile dealership which 
allegedly engaged in deceptive advertising. Chambers Motorcars 
allegedly placed an advertisement in the 1993-94 NYNEX Yellow 
Pages that falsely stated the dealership was "Greater Boston's 
only Authorized Saab Dealer." Under the terms of the consent 
judgment, which was filed in Middlesex Superior Court, Chambers 
is permanently prohibited from making misrepresentations about 
its dealership in any advertising medium. Chambers also agreed 
to contribute a $1,500 donation as a corporate sponsor of the 
SCORE program. 

Comm. V. Nissan of Lynnfield, Inc. 

On May 24, 1994, the Division filed a consent judgment in 
Suffolk Superior Court with a Lynnfield car dealer, Nissan of 
Lynnfield, Inc., involving alleged violations of Massachusetts 
motor vehicle advertising regulations. 

A review of the defendant's advertisements indicated that 
Nissan of Lynnfield, Inc. had allegedly advertised specific low 
prices for certain vehicles, only to disclaim the low price 
elsewhere in the advertisement by indicating that additional cash 
or a trade-in vehicle was necessary in order for a consumer to 
get the stated price. In addition, Nissan of Lynnfield, Inc. 



allegedly advertised that some vehicles were sold "loaded," 
without indicating the actual options available with the vehicle, 
and failed to clearly and conspicuously disclose that certain 
vehicles offered for sale were former lease or daily rental 
vehicles. Under the terms of the agreement, Nissan of Lynnfield, 
Inc. has agreed to change its advertising to comply with 
applicable regulations, and to pay a civil penalty of $5,000. 

Commonwealth v. Advantage Toyota, Inc. 

On May 27, 1994, the Division obtained a consent judgment with 
Advantage Toyota, Inc., a Weymouth dealership, that enjoined the 
dealership from engaging in future misleading advertising and 
required the payment of a civil penalty of 

$2,500. The Commonwealth alleged that the defendant's ads misled 
consumers by featuring specific cars and promising "no down 
payment, " while disclaiming elsewhere that the offer excluded 
advertised vehicles, and advertising prices that were only 
available if consumers traded in vehicles worth thousands of 
dollars . 

Comm. V. James Kasilowski 

On June 1, 1994, the Division entered into a consent judgment 
with James Kasilowski of Pepperell, formerly the president of 
Auto Adoption, an auto-brokering business formerly located in 
Tyngsborough. Kasilowski allegedly solicited consumers who had 
difficulty making car payments and claimed he could find someone 
for them to "take over" the payments and eventually buy the car 
from them. Kasilowski allegedly failed to inform banks and 
financing companies of the proposed changes in ownership in 
violation of the contract between the bank or financing company 
and the consumer and the state's Consumer Protection Act. 
Consumers were unable to register or insure the cars they paid 
for because the banks were not aware of the proposed changes of 
ownership. 

Pursuant to the consent judgment filed in Suffolk Superior 
Court, Kasilowski agreed to provide restitution to consumers, not 
to broker cars in the future and to pay a $1,000 civil penalty. 

Comm V . Smyly Autos , Inc . 

On June 29, 1994, the Division obtained a consent judgment in 
Middlesex Superior Court with Smyly Autos, Inc., a Maiden car 
dealer, for placing allegedly misleading advertisements. The 
alleged advertising violations included ads which misled 
consumers into believing that they could lease a vehicle for a 
particular monthly rate, when they actually had to make 
considerable downpayments in order to get the advertised monthly 
lease rate and advertised car sale prices which were only 
available to consumers if they paid thousands of dollars in cash 
or traded in a vehicle. 



The consent judgment enjoins Smyly Autos, Inc. from engaging 
in future misleading advertising and requires the payment of 
$2,500 in civil penalties. The owner of Smyly Autos, Inc. is 
also required to pay $2,500 to the Local Consumer Aid Fund. 

CREDIT AND DEBT COLLECTION 

In the Matter of Bose Corporation 

On July 29, 1993, the Division filed an assurance of 
discontinuance with Bose Corporation that provides refunds to 
more than 5,000 consumers nationwide who had unauthorized 
charges levied on their credit card accounts for merchandise they 
never ordered. Under the terms of the settlement filed in 
Suffolk Superior Court, in addition to the consumer refunds, Bose 
paid $35,000 to help fund the Local Consumer Aid Fund. 

In the Matter of Payco American Corporation 

On December 22, 1993, the Division filed an assurance of 
discontinuance in Suffolk County Superior Court in which a 
national debt collection company agreed to abide by state debt 
collection regulations and pay $200,000 in connection with 
alleged prior violations. 

The Attorney General's Office had received complaints charging 
that Payco-General American Credits, Inc., National Account 
Systems, Inc., National Account Systems, Inc. d/b/a American 
Credit & Collection, and National Account Systems, Inc. d/b/a 
Payco-General American Credits, all subsidiaries of Payco 
American Corporation of Brookfield, Wisconsin, with a local 
office in Hingham, violated state debt collection regulations by 
telling third parties -- including employers, neighbors, and 
family members -- about consumers' debt; calling consumers more 
times than the law allows; requesting or demanding that consumers 
send post-dated checks; and using intimidating language to harass 
consumers . 

Pursuant to the assurance, Payco agreed to refrain from 
engaging in unfair debt collection practices in the future. The 
$200,000 was paid to the Local Consumer Aid Fund and to the 
Commonwealth as costs. 

In the Matter of Equifax Credit Information Services, Inc. 
On December 23, 1993, the Division filed an assurance of 
discontinuance in Suffolk Superior Court entered into by Equifax 
Credit Information Services, Inc., arising out of allegations 
that the company erroneously listed property tax liens in the 
credit files of thousands of Massachusetts residents. The 
company agreed to pay a minimum of $240,000 in restitution to 
injured consumers and payments to the state. 

The Commonwealth alleged that between January, 1991 and April, 
1992, Equifax, one of the three largest credit reporting agencies 
in the country, mistook "Municipal Lien Certificates" recorded at 
local registries of deeds offices for conventional liens. 



91 



Equifax then characterized the Municipal Lien Certificate as a 
"lien" in consumers' credit files, and disseminated credit 
reports containing the misleading information for thousands of 
consumers . 

Under the terms of the settlement, the nearly 1,2 00 consumers 
who were most likely harmed by the lien information in their 
credit reports will receive an offer of compensation. Equifax 
stopped including Municipal Lien information in its credit files 
in April, 1992, and has agreed as part of the settlement not to 
include Municipal Lien Certificate information in its regular 
credit reports in the future. 

Comm. V. Milliken & Michaels, Inc. 

On January 14, 1994, the Division filed a consent judgment in 
Suffolk Superior Court with a Louisiana-based debt collection 
agency that was unlicensed to do business in Massachusetts. The 
complaint alleges that Milliken & Michaels was engaging in debt 
collection activity in Massachusetts without having obtained a 
license to do so, and without having posted a bond as required by 
the Massachusetts Commissioner of Banks. 

Under the terms of the consent judgment, Milliken & Michaels 
must cease its debt collection efforts in Massachusetts until it 
obtains the necessary license and posts an adequate bond, and 
paid a $10,000 civil penalty to the Commonwealth. 

FINANCIAL 

Comm V. Thomas J. Spencer 

On August 18, 1993, the Division filed a civil suit in Suffolk 
Superior Court, prohibiting Thomas F. Spencer, Jr., a Melrose 
attorney, from further serving as a closing attorney in 
residential mortgage loan transactions. At the same time the 
Division obtained an assented to preliminary injunction, whereby 
Spencer agreed to refrain from further engaging in dealings as an 
attorney handling residential mortgage loan transactions. In 
residential mortgage loan closings, lenders gave Spencer new loan 
proceeds with the expectation that he would use the proceeds to 
pay off existing mortgages and other obligations. Spencer, 
however, allegedly failed to properly apply funds in at least 20 
consumer transactions, and allegedly kept approximately 
$1,700,000 for his own use. 

Security Title and Guaranty Company, the title insurance 
company that issued policies of title insurance in all of the 
transactions, paid off most of the first mortgage holders and 
other obligors whom Spencer allegedly should have paid. 

Comm. V. First Investors Corp., et al . 

On October 13, 1993, the Division, in cooperation with the 
Massachusetts Secretary of State's Office filed a consent 
judgment in Suffolk Superior Court in settlement of the 
Commonwealth's lawsuit against First Investors Corporation, a 



92 



Wall Street securities firm, and its principals. The settlement 
provided $32.2 million nationwide to consumers and mandated 
significant changes in the way the company does business. 

Suit was filed against First Investors in September, 1991, for 
alleged violations of the Massachusetts Consumer Protection Act 
and the state Securities Act. The Commonwealth's complaint 
alleged that First Investors' salespersons deliberately misled 
customers into believing that two junk bond mutual funds sold by 
First Investors, First Investors Fund for Income and First 
Investors High Yield Fund, were as safe as certificates of 
deposits (CDs) and involved little or no risk. 

Under the settlement. First Investors will pay $32.2 million 
into a fund from which eligible consumers nationwide will receive 
compensation. In addition, the four principals of the firm will 
be barred from the securities business in Massachusetts for a 
period of two years. First Investors will also pay $100,000 to a 
consumer education fund to prevent future harm to consumers 
created by fraudulent sales and marketing practices. 

Comm. V. Senior Financial Services, Inc., et al . 

On November 2, 1993, the Division filed suit in Suffolk 
Superior Court against a Pittsfield corporation, a Pittsfield 
salesperson and a South Carolina resident who market 
"personalized living trusts" for the use of Massachusetts 
consumers. The suit alleged that Senior Financial Services, 
Inc.; John Ben Merchant of Pittsfield; and Richard Anthony of 
South Carolina, doing business as "Anthony Associates," offered a 
package of documents, including among them a living trust, powers 
of attorney, wills and health care proxies to Massachusetts 
consumers as estate planning devices. These documents have 
allegedly serious legal consequences, and neither Merchant nor 
Anthony had any formal legal training. 

The complaint requests that the defendants be enjoined from 
continuing their present sales tactics, and requests restitution 
for Massachusetts consumers . 

Comm. V. Via Brazil of Boston, Inc., et al . 



On March 15, 1994, the Division obtained a consent judgment 
against Via Brazil of Boston, Inc. and Via Brazil, Inc., of 
Florida, after they allegedly failed to transmit funds to foreign 
countries on behalf of customers. 

The consent judgment filed in Suffolk Superior Court, 
permanently prohibits the defendants from accepting money from 
customers for transmission to foreign countries. Via Brazil must 
also pay $4,985 in restitution to customers who did not receive 
refunds and $3,000 in civil penalties. 



93 



Comin. V. Richard North, et al . 

On April 29, 1994, the Division filed suit and obtained a 
temporary restraining order against Richard D. North, a Duxbury 
investment advisor and North Asset Management, of Boston. 
The temporary restraining order was extended to a preliminary 
injunction on May 17, 1994 and enjoins both defendants from 
engaging in the provision of financial services to the public and 
from concealing or removing assets from the Commonwealth. 

The Commonwealth's complaint alleged that North, individually 
and in his capacity as an officer and director of the company, 
solicited and received over $450,000 from consumers purportedly 
for the purpose of investing the money. Some or all investments 
were allegedly never made and the funds were dissipated by the 
defendants . 

HEALTH AND MEDICAL ISSUES 

Comm. v. Julian Porter d/b/a Porter House 

On August 11, 1993, the Division obtained a consent judgment 
with Julian Porter, the former operator of Porter House, an 
unlicensed nursing home, located in Newton. The judgment 
prohibits Porter from running an unlicensed nursing home; from 
neglecting elderly, infirm or disabled patients; and from 
misrepresenting the type of personal or health care services 
offered to individuals for a fee. It also required Porter to pay 
$10,000 in civil penalties and $25,000 in monetary damages. 

Comm. V. U.S. Health, Inc., et al . 

On October 6, 1993, the Division filed a complaint for 
contempt in Suffolk Superior Court against the corporations that 
operate the Holiday Health spas in Massachusetts, including 
Holiday Universal, Inc., and Bally 's Health and Tennis 
Corporation. The suit alleged that Holiday committed civil 
contempt by violating the terms of a 1989 consent judgment 
against the companies, and requested that the Court permanently 
prohibit the companies from operating in Massachusetts as a 
habitual violator of the Commonwealth's Consumer Protection Act. 
The Complaint further seeks that the companies provide 
restitution to injured consumers and that the court impose 
penalties against the companies . 

In the Matter of Meadowbrook Nursing Home of Canton 

On February 17, 1994, the Division entered into an assurance 
of discontinuance whereby Meadowbrook Nursing Home of Canton will 
pay back $22,000 to individuals who had agreed to pay private 
nursing care rates in order to get a Medicaid-eligible relative 
admitted to the home. 

The Commonwealth alleged that the defendant had refused to 
admit several Medicaid residents until a relative agreed to pay 
the rates charged to private residents for up to six months. At 
least four people, anxious to have their relative admitted to 
Meadowbrook, a new facility, had signed admission contracts which 



94 



effectively gave up the patient's right to receive Medicaid 
coverage for a substantial period of time. It is unlawful for a 
nursing home to require patients to waive any of their Medicaid 
rights . 

The assurance of discontinuance requires the repayment of 
approximately $22,000 in restitution to the two people who paid 
privately for the care of a relative who was a Medicaid 
beneficiary and the payment of a civil penalty of $5,000. 

Comm. V. Centre de Nutricion y Terapias Naturales, Inc., et al . 

On March 16, 1994, the Division sued and obtained an assented- 
to preliminary injunction against Centre de Nutricion y Terapias 
Naturales, Inc., and Alcibiades Acosta, prohibiting them, or 
their employees, from engaging in the unauthorized practice of 
medicine and from advertising that they can cure, treat or 
prevent any medical disease or condition. Centro de Nutricion y 
Terapias Naturales, Inc. operates in storefronts located in 
Boston and Lawrence. Each storefront offers vitamins, herbs and 
other products advertised by the Centro as "medical remedies." 
These storefront locations also contain examining rooms where 
Acosta and other self -proclaimed doctors examined and treated 
patients for various ailments. 

In the Matter of Miles, Inc. 



On April 4, 1994, the Division, along with ten other states 
entered into an assurance of discontinuance with Miles, Inc., a 
major pharmaceutical company, that prevents the company from 
resuming payments to pharmacists for switching patients to its 
hypertension drug and requires Miles to pay $605,000 ($55,000 per 
state) to 11 states for consumer education. 

In June, 1993, Miles offered to pay pharmacists nationwide for 
switching consumers who were using its sole competitor's 
medication to Miles' new prescription drug, Adalat CC, for the 
treatment of hypertension. Before stopping the payment program 
in November, 1993, Miles paid over $358,415 to participating 
pharmacies in 11 states for consumers switched to its drug. 
Miles did not disclose these payments to consumers or require 
participating pharmacists to tell consumers about the payments. 

Under the settlement reached with the 11 states. Miles, Inc. 
is barred from ever resuming the program or any similar one 
involving payments to pharmacists, agrees to comply with a 
federal anti-kickback law, and will report to the States to 
ensure compliance. 

In the Matter of Dahlberg, Inc. 

On April 6, 1994, the Commonwealth and 35 other states entered 
into an assurance of discontinuance with Dahlberg, Inc., a 
Minnesota corporation, concerning its advertising for Dahlberg ' s 
Miracle Ear hearing aids and Clarifier circuits. In its 
advertisements for its hearing aids, Dahlberg represented that 
its hearing aids could eliminate unwanted background noise. 



95 



allowing hearing aid users to understand and enjoy conversation, 
even in crowded and noisy environments. The Attorneys General 
allege that these advertisements were false and misleading, since 
no hearing aid can "focus" on sounds an individual wants to hear 
or eliminate background noise. 

Under the settlement, Dahlberg must disclose in future 
advertising that hearing aids may not provide the same benefits 
to most or all users, and that the overall benefit provided by 
hearing aids may depend on proper fit, degree or severity of 
hearing loss, and accuracy of patient evaluation. In 
advertisements featuring the Clarifier, the company must also 
disclose that the Clarifier is an option and that understanding 
speech may still be difficult in noisy settings. The settlement 
also requires Dahlberg to pay $700,000 in costs to the states. 

In the Matter of Olde Sturbridge Country Farms 

On April 8, 1994, the Division filed an assurance of 
discontinuance with Olde Sturbridge Country Farms, a Warren egg 
producer, requiring the defendant to stop making unsubstantiated 
claims about the fat content of its eggs. In addition, Olde 
Sturbridge agreed to pay $2,500 to the Local Consumer Aid Fund. 

Comm. V. University Hospital, et al . 

On April 12, 1994, the Division filed a consent judgment 
reached with University Hospital (an affiliate of Boston 
University Medical Center) regarding alleged unfair practices in 
the recruiting of patients with spinal cord injuries for 
experimental surgery. The consent judgment requires the Hospital 
to pay up to $1.5 million in restitution to the patients and in 
payments to the state. 

Contemporaneous with the filing of the consent judgment, the 
Attorney General also filed a complaint in Suffolk Superior Court 
against Dr. Harry S. Goldsmith. The complaint alleges that the 
Hospital and Dr. Goldsmith worked with a Texas resident, Barbara 
A. Devine, to assist in the screening and selection of patients 
for the experimental surgery. Devine allegedly made numerous 
misrepresentations to patients with spinal cord injuries, 
including exaggerating the results that patients could expect to 
gain from surgery, and misleading individual patients to believe 
they were uniquely qualified to benefit from the surgery. 

Under the terms of the consent judgment, the Hospital is 
required to offer to return to the 26 patients who had the 
surgery, all of their medical expenses, estimated to be up to 
$45,000 per patient, and an additional $5,000 per patient for 
related expenses. The Hospital is also required to pay $250,000 
to the Commonwealth. 

The litigation is continuing against Dr. Goldsmith. 



In the Matter of Super Fitness, Inc., et al . 

On May 15, 1994, Super Fitness, a health club with locations 
in Quincy and Water town, entered into an assurance of 
discontinuance with the Division involving alleged 
misrepresentations of the scheduled opening date of the Watertown 
facility, and other complaints. The Commonwealth alleged that 
Super Fitness employees made misrepresentations regarding the 
date that the Watertown facility would open, and regarding 
services to be offered at that site. In addition, Super Fitness 
allegedly misrepresented that certain pre-opening discount 
memberships were available on a limited basis. 

Under the terms of the agreement. Super Fitness has obtained 
the bond required of health club facilities in the Commonwealth, 
and will make all required disclosures in the future. Super 
Fitness will offer refunds to consumers who were harmed by the 
failure of the facility to open. In addition. Super Fitness will 
pay $25,000 to the Commonwealth in civil penalties for the 
alleged violations of law. 

HOME IMPROVEMENT AND MORTGAGE 

Advanced Financial Services Agreement 

On August 26, 1993, the Division reached a home improvement 
loan settlement worth approximately $100,000 to Massachusetts 
consumers with Advanced Financial Services, Inc., a Rhode Island 
mortgage lender. The agreement resolves claims regarding the 
company's potential liability for home improvements arranged by 
Carefree Building Products, Inc., and its principal, David Haigh. 
The Division had previously sued Carefree and Haigh for consumer 
protection violations in the selling of home improvement services 
to Massachusetts consumers. 

Under the terms of the settlement, some consumers whose 
Carefree home improvement loans were financed by Advanced 
Financial Services may be eligible for cash refunds and loan 
adjustments, including payments to repair incomplete or shoddy 
home improvement work, refunds equal to one-half of the total 
closing points charged to each borrowers, and additional lump sum 
cash payments. Consumers may also be eligible for loan rewrites 
at lower interest rates and adjusted monthly payment schedules. 

Comm. V. U.S. Mortgage Service Corp . 

On October 27, 1993, the Division obtained a consent judgment 
in Suffolk Superior Court against U.S. Mortgage Service 
Corporation (USMSC) , a Pennsylvania corporation which markets a 
product called the Early Mortgage Retirement program. The Early 
Mortgage Retirement program provides a structure for consumers to 
convert monthly mortgages to biweekly mortgages for a substantial 
fee. In a complaint filed simultaneously with the consent 
judgment, the Commonwealth alleged that USMSC used sales kits 
which contained false and misleading scripts used by 
telemarketers. The scripts allegedly included misleading 
statements that the company telemarketer was conducting a survey 



or was working in conjunction with either the homeowner's county 
government or the homeowner's mortgage company. Under the terms 
of the consent judgment, USMSC is enjoined from making these and 
other false and misleading statements. 

Under the terms of the consent decree, USMSC is required to 
pay $2,000 in restitution and $2,500 in penalties. USMSC also 
agreed to change its recruiting practices in order to comply with 
regulations governing help wanted advertisements. 

In the Matter of First Eastern Mortgage Corp . 

On November 29, 1993, the Division filed an assurance of 
discontinuance in Suffolk Superior Court against First Eastern 
Mortgage Corporation, an Andover-based mortgage company. First 
Eastern had been using a form of rate-lock agreement to allow 
consumers to lock- in an interest rate during the home mortgage 
application process. The Commonwealth alleged the agreement 
failed to clearly disclose to consumers, prior to the execution 
of the rate-lock agreement, the exact nature and extent of First 
Eastern's refund policy. 

Pursuant to the Assurance, First Eastern Mortgage Corporation 
is required to provide approximately $29,000 in refunds to 3 6 
loan applicants in Massachusetts who had executed a rate-lock 
agreement and paid a fee to lock in an interest rate during the 
process of an application for a mortgage loan which was 
ultimately not approved. First Eastern is also required to 
revise the form of the rate-lock agreement to be used in future 
transactions . 

Comm. v. Earl Pentland 

On December 10, 1993 the Division filed a consent judgment in 
Suffolk Superior Court with Earl Pentland, a Falmouth man who 
sells home improvement services. Pentland, allegedly made 
deceptive and misleading representation to consumers in the sale 
and financing of home improvement services; induced consumers to 
sign written agreement when he knew that the consumers did not 
understand the terms of the instrument; and failed to 
satisfactorily complete home improvement jobs for which he 
received advance payment. The consent judgment enjoins him from 
engaging in deceptive practices in the provision of home 
improvement services and requires him to pay $26,000 in 
restitution and fines. 

Commonwealth v. Thomas Field d/b/a F & D Unlimited Construction 
of Lowell 

Comm. Kevin DiMario d/b/a K.D. Specialized Contracting, Inc . 

Comm. v. William Oats d/b/a New Englander Architectural Products 
Corp. 



98 



Comm. V. Robert Presti 

On January 5, 1994, the Division filed separate lawsuits 
against four home improvement contractors who allegedly failed to 
register with the state's Bureau of Building Regulations and 
Standards, as required by the 1992 law regulating home 
improvement contractors . 

The four contractors sued were: Thomas Field d/b/a F & D 
Unlimited Construction of Lowell; Kevin DiMario, d/b/a K.D. 
Specialized Contracting, Inc., of Lawrence; William Oats, who has 
done business as New Englander Architectural Products Corp., of 
Holliston, New Englander Factory Direct of Shrewsbury, and New 
Englander Home Remodeling of Shrewsbury; and Robert Presti, who 
has done Business as International Kitchens of Lexington, the 
International Kitchen Inc., of Burlington and Studio One Kitchens 
of Woburn. 

On March 3, 1994, the Division filed a consent judgment with 
Thomas Field. The judgment required Field to register as a home 
improvement contractor and to pay a $100 civil penalty. 

On March 7, 1994, the Division filed a consent judgment with 
Kevin DiMario, requiring DiMario to register as a home 
improvement contractor and to pay a $100 civil penalty. 

On March 16, 1994, the Division filed a consent judgment with 
William Oates, requiring Oates to register as a home improvement 
contractor and to pay a civil penalty of $5,000. 

NationsCredit Financial Services Corporation Agreement 

On January 28, 1994, the Division reached a home improvement 
loan settlement with NationsCredit Financial Services Corporation 
Company, a Pennsylvania mortgage lender. The agreement resolves 
claims regarding the company's potential liability for home 
improvements arranged by Carefree Building Products, of Boston, 
and its principal, David Haigh, of Scituate. 

Under the terras of the settlement, consumers whose Carefree 
home improvement loans were sold to other lenders and were 
eventually purchased by NationsCredit will receive reductions in 
their loan principals by the amount of overcharges in their home 
improvement work as well as a credit for the costs of repairing 
shoddy home improvement work. Also, the terms of the loans will 
be rewritten to provide for an eight percent interest rate from 
the start of the original loan and consumers will also be 
eligible for $500 payments and other favorable adjustments to 
loan terms . 

Dime Savings Bank Agreement 

On March 22, 1994, the Commonwealth reached a settlement with 
the Dime Savings Bank of New York, under which Dime will offer to 
modify or restructure the loans of thousands of Massachusetts 
residents who obtained mortgages from the bank in the late 
1980 's. Dime will also offer a $6 million new loan program to 



99 



the hundreds of individuals in Massachusetts who have been 
foreclosed by Dime and will forgive all outstanding indebtedness 
on foreclosed loans. 

Under the terms of the agreement. Dime will offer relief to 
borrowers who obtained a Dime mortgage for the purchase of a 
primary residence. Dime will offer to modify the negative 
amortization loans of all borrowers to either positively 
amortizing adjustable rate mortgages or fixed rate loans, 
depending on the choice and financial circumstances of the 
borrower. For borrowers seriously in default, Dime will attempt 
to achieve a "work out" with the borrower, either by refinancing 
to longer term fixed rate mortgages or by writing off some or all 
of the unpaid interest which has accumulated, or by other 
alternative means. Borrowers who have already been foreclosed 
will be released from any outstanding deficiency by Dime and will 
be offered the opportunity to participate in a $6 million new 
loan program. Dime has also agreed not to market any new 
residential loans in Massachusetts without prior notice to the 
Attorney General of the exact terms and marketing plans for those 
mortgages . 

Comm. V. Mastalerz d/b/a Bay State Bathtub Liners 

Also on March 22, 1994, the Division filed a civil contempt 
action in Suffolk Superior Court against a former bathtub liner 
salesman for failing to pay restitution to Massachusetts 
consumers under the terms of a consent judgment approved on 
August 18, 1993. 

The Attorney General's office had obtained a consent judgment 
requiring Ronald J. Mastalerz, of Boston, to pay $7,855 in 
restitution to consumers by September 30, 1993, for failure to 
deliver bathtub liners which they had purchased or refund their 
money. Mastalerz, who did business as Bay State Bathtub Liners, 
Inc., in Woburn, had received deposits from 30 consumers. 

In addition to making restitution to consumers, Mastalerz was 
required to pay $2,500 in civil penalties. The Attorney General 
is now seeking a $10,000 penalty for each violation of the court 
order. 

Comm. V. Carefree Building Products Inc., et al . 

On April 29, 1994, the Division filed a consent judgment in 
Suffolk Superior Court with James Kendrick, a Revere man who is 
in the business of selling and providing home improvement 
services. Kendrick and his co-defendant in this action, David 
Haigh, of Scituate, allegedly violated the Consumer Protection 
Act by making deceptive and misleading representations to 
consumers in the sale and financing of home improvement services; 
inducing consumers to sign written agreements when they knew that 
the consumer did not understand the terms of the instrument ; 
overcharging consumers unconscionable amounts for home 
improvement services and falsifying financial information on loan 
applications to lenders. 



100 



Under the terms of the consent judgment, Kendrick is 
permanently enjoined from misrepresenting material facts and 
failing to disclose material facts to consumers in the sale and 
financing of home improvement services. 

Comm. V. Bowen d/b/a/ Bowen Construction Co., et al . 

On June 22, 1994, the Division filed a consent judgment 
against Peter Ingraldi, aka Peter Bowen, a Scituate home 
improvement contractor who allegedly overcharged elderly 
consumers for shoddy and incomplete work. In settlement of the 
case, Ingraldi agreed to pay $10,000 in restitution to seven 
consumers. In addition, he agreed to refrain from 
misrepresenting material facts from consumers in the sale and 
financing of home improvement services. He also agreed to 
provide each elderly consumer with a one-page consumer rights 
bulletin. 

LEAD PAINT 

Comm V. Daniel C. Robinson d/b/a Deluxe Deleading, et al . 

On July 14, 1993 the Division filed a consent judgment in 
Suffolk Superior Court requiring Daniel C. Robinson, a Framingham 
deleading contractor, to provide 100 hours of community service 
in Lowell and enjoining him from further lead abatement 
violations. Robinson allegedly violated the Massachusetts lead 
laws in connection with the abatement and inspection of two 
apartment buildings in Lowell. 

On Nov. 9, 1993, the Division also filed a final consent 
judgment in Suffolk Superior Court, banning Tiger Home 
Inspection, Inc., from doing lead abatement inspections in the 
Commonwealth. Tiger issued the letters of compliance for the two 
Lowell properties deleaded by Robinson. Pursuant to the consent 
judgment. Tiger is permanently enjoined from conducting lead 
abatement inspections in Massachusetts. In addition, Tiger 
donated $17,500 to a program to be administered through Roxbury 
Community College, which is designed to enhance the training of 
lead abatement contractors and lead abatement inspectors. 

Comm. V. American Lead Abatement, Inc., et al. 

On May 3, 1994, the Division filed suit in Suffolk Superior 
Court against American Lead Abatement, Inc., of Centerville, a 
deleading contractor; Douglas L. Williams, Sr., of Marston Mills, 
in charge of lead abatement for the company; and James C. Judge, 
of Kingston, a lead inspector. 

In two instances, consumers that contracted with American Lead 
Abatement to do abatement work also agreed to pay for hazardous 
lead waste disposal under their contracts. At the end of each 
job, Williams allegedly requested exorbitant fees for hazardous 
lead waste disposal, in one case 22 times the amount estimated in 
the contract. When consumers refused to pay, Williams allegedly 
returned 55-gallon drums filled with hazardous lead waste back to 



101 



consumers. Judge did the initial lead paint inspection of the 
property and issued letters of lead abatement compliance for the 
property. Subsequent inspections allegedly revealed that Judge 
had missed a number of surfaces that required lead abatement 
during the initial inspection and had improperly certified the 
house . 

The Commonwealth's complaint seeks an injunction that would 
prohibit Williams from proving deleading services to the public 
for a period of at least three years and prohibits Judge from 
providing lead paint inspections for a period of at least three 
years. The Commonwealth is also seeking restitution for 
consumers injured by the allegedly deceptive acts of the 
defendants, penalties and costs of investigation 

Comm. V. Kevin French 

On June 2, 1994, the Division filed a consent judgment in 
Suffolk Superior Court with Kevin French, a lead paint inspector 
who allegedly violated the Massachusetts lead paint laws by 
issuing letters of compliance in early 1991 for two contaminated 
residential properties in Salem. 

The consent judgment requires French to pay $1,000 in civil 
penalties and prohibits him from violating the state lead paint 
laws in the future. The judgment further requires French to 
retake and pass the state lead paint training program and written 
exam. Any violation of the judgment will result in a lifetime 
ban from the lead paint abatement industry 

LIQUIDATION AND GOING OUT OF BUSINESS SALES 

In the Matter of Gordon Brother Partners, Inc., et al. 

On December 28, 1993, the Division filed an assurance of 
discontinuance in Suffolk Superior Court with Gordon Brothers 
Partners, Inc., and/or Cotton Kidz , Inc., a jewelry and 
merchandise retailer/liquidator and its agent. 

The defendants ran close-out sales and other promotions in 
which they advertised that goods had been obtained from a well- 
known retailer and were now substantially reduced in price. The 
Attorney General alleged that in some cases, goods from other 
sources were mixed in, diluting the well-known retailers' goods, 
without clear disclosure of this inventory dilution of consumers. 
In other cases, price tags were affixed or altered, reflecting a 
higher than true regular price, and the marked price was 
immediately discounted, creating the impression of more 
significant savings than was the case. 

Under the terms of the settlement, the defendants agreed to 
comply with Massachusetts law and the Attorney General's 
regulations in the future. As part of the agreement, Gordon 
Brothers agreed to pay $25,000, and Cotton Kidz agreed to pay 
$150,000, which will be contributed to various state consumer and 
violence prevention programs and greater Boston Legal Services. 



In the Matter of Designer Clothing Ltd. d/b/a Ralph's 
Liquidation Center 

On March 31, 1994, the Division filed an assurance of 
discontinuance in Suffolk Superior Court entered into with 
Ralph's Liquidation Center in Woburn. The assurance resolved the 
Commonwealth's concerns about an allegedly illegal "going out of 
business" sale by Ralph's Liquidation Center, an off -price seller 
of men's designer suits. The company which owns Ralph's, 
Designers Clothing Limited, had previously conducted store 
closing sales at its former locations less than two years 
earlier, making the recent sale illegal under state law. 

Pursuant to the assurance, Ralph's donated 100 designer suits 
to the New England Shelter for Homeless Veterans in Boston. 

Comm. V. J.K. Liquidators, Inc., et al. 

On April 25, 1994, the Division filed a lawsuit against Joseph 
Kessler, Irma Gross and Nancy Guarino, three individuals 
associated with the defunct Boston Scandals furniture outlets. 
The complaint alleges the three violated a restraining order and 
preliminary injunction obtained last year by using J.K. 
Liquidators, Inc., to illegally bring in additional inventory 
during their final going-out-of -business sale last fall. 

The lawsuit seeks a judgment of civil contempt, civil 
penalties, costs and attorneys' fees against the defendants. 

TRAVEL CASES 

Comm. v. Admiral's Cruise Center, Inc. 

On August 13, 1993, the Division filed suit against Admiral's 
Cruise Center, Inc., a Stoneham travel agency that failed to 
supply cruise vacation packages to dozens of Massachusetts 
consumer who paid for the vacations. The Division and the 
Stoneham Police received several consumer complaints on August 11 
and 12, 1993, indicating that numerous consumers had been bilked 
of their money after the travel agency closed its doors. The 
agency claimed a lack of funds kept it from continuing 
operations . 

Comm. V. New Horizons, Inc., et al . 

On Feb. 18, 1994, the Division reached a settlement with New 
Horizons, Inc., a Watertown non-profit travel company that 
provided vacation packages for individuals with disabilities. 
New Horizons had been providing vacation packages to consumers 
for over 10 years. In September, 1993, the company allegedly 
began canceling vacations that consumers had paid for, and failed 
to provide refunds. 

Under the consent judgment. New Horizons, Inc. and Stanley M. 
Jacobs, Executive Director, have agreed to permanently refrain 
from providing travel arrangement services to the public and will 
pay a minimum of $11,995 in restitution to affected consumers 



103 



Comm. V. Milestone Educational Institute Inc., et al . 

On May 23, 1994, the Division obtained a default judgment 
against Christopher D\iMello Kenyon, owner of the defunct student 
travel company Milestone Educational Institute, Inc. The 
judgment entered in Middlesex Superior Court holds Kenyon liable 
to 4500 injured consumers across the country for a total of 
$7,761,047.00. The judgment also prohibits Kenyon from ever 
returning to Massachusetts to do business, and from ever 
soliciting Massachusetts residents as customers. 

Comm. V. Anthony Belli d/b/a Centennial Travel and Tony's Casino 
Tours 

On May 27, 1994, the Division filed a lawsuit against Anthony 
Belli Sr . , a North Shore tour operator for allegedly canceling 
hundreds of trips and refusing to return more than $20,000 to 
consumers. The suit alleges that Belli, former proprietor of 
Tony's Casino Tours and Centennial Travel in Danvers and Peabody, 
sold charter tours to Las Vegas, then abruptly canceled the trips 
without returning consumers' deposits. 

The Commonwealth's complaint seeks an injunction to prevent 
Belli, who has filed for bankruptcy, from engaging in further 
consumer fraud and civil penalties. 

UNAUTHORIZED PRACTICE OF LAW 

Commonwealth v. Leon Aronson 

On January 5, 1994, the Division obtained a permanent 
injunction ordering Leon Aronson, a disbarred Boston attorney to 
stop his alleged unauthorized practice of law. Additionally, 
Aronson is permanently enjoined from soliciting or accepting fees 
for legal services. Though he was disbarred in June, 1993, 
Aronson allegedly continued to practice law and held himself out 
as an attorney after his disbarment, misrepresented that he was 
still authorized to practice law, and failed to disclose to 
consumers, other attorneys or to the court that he had been 
disbarred. The Division is pursuing an accounting of monies 
received for legal work following Aronson 's disbarment, 
restitution for injured consumers, and civil penalties and costs. 

In the Matter of Nelly Gutierrez Legalization Services Committee 

On January 12, 1994, the Division obtained an assurance of 
discontinuance from Nelly Gutierrez Legalization Services 
Committee, an Allston company allegedly engaged in the 
unauthorized practice of immigration law. In the assurance, 
Nelly Gutierrez and her Legalization Committee agreed to 
immediately cease representing people in INS proceedings and 
promised that Gutierrez would not hold herself out as an attorney 
or otherwise engage in the practice of law. The defendants were 
also required to pay $5,000 as restitution to their clients. 



GENERAL CASES 

Comm. V. Nathan F. Fisher d/b/a Fisher Moving and Storage, et al . 

On September 16, 1993, the Division filed suit and obtained a 
temporary restraining order against Nathan F. Fisher and his 
moving and storage businesses, Fisher Moving and Storage, Fisher 
Movers, Inc. and A. Fisher Storage, Inc., all of South Boston. 
The complaint alleges that the defendants recklessly stored 
consumers' personal property and sold consumers' property without 
notifying them of the sale. The temporary restraining order 
prevents the defendants from further engaging in these acts. 

On April 15, 1994, the Division obtained an order in this case 
that called for the operation of the warehouse by an 
administrator and allowed consumers to reclaim belongings which 
had been stored in the warehouse for months. 

The complaint seeks permanent injunctive relief, as well as 
restitution for injured consumers and the costs of litigation. 

Comm. V. Jordan Marsh Stores Corporation 

On November 1, 1993, the Division filed an assurance of 
discontinuance entered into by Jordan Marsh Stores Corporation, 
in which the Commonwealth alleged that the company routinely 
inflated the regular price of mattresses, box springs and other 
goods as a means to appear to offer large discounts during sales. 
State regulations provide that a seller cannot compare its sale 
prices to fictitious or exaggerated regular prices. 

As part of the settlement, Jordan Marsh refunded $340,000 to 
approximately 6,000 consumers who purchased mattresses or box 
springs from October, 1992 through March, 1993. An additional 
$38,000 will be paid to the Local Consumer Aid Program. Jordan 
Marsh is also prohibited from pricing items with exaggerated 
regular prices as a means to advertise false discounts and from 
making savings claims without first possessing appropriate 
substantiation . 

In the Matter of Meca Software, Inc. 



On December 6, 1993, the Division filed an assurance of 
discontinuance in Suffolk Superior Court entered into by Meca 
Software, Inc., in which the state alleged that the packaging for 
Meca ' s "TaxCut" tax preparation software made misleading 
representations that the product could completely prepare for 
filing and print 1993 returns, when such was not the case. 

Under terms of the settlement, in addition to paying $17,500 
in penalties and costs, Meca agreed to refund the purchase price 
to consumers who were misled, ship a disclaimer sticker to be 
attached to the front panel of the product, and prominently 
disclose any functional limitations or additional requirements on 
future releases. 



105 



Commonwealth v. North American Directories, Inc., et al . 

On December 14, 1993, the Division filed a lawsuit in Suffolk 
Superior Court against two Florida companies. North American 
Directories, Inc. and Directory Publishing Services, Inc., which 
allegedly sent misleading and deceptive solicitations to 
businesses under the guise that such solicitations were for 
authentic phone company yellow page directories. 

Specifically, the complaint alleges the defendants failed to 
adequately disclose that the defendants do not publish the local 
"Yellow Pages" customarily distributed to all telephone 
subscribers in the local area; the directories are national, 
regional or statewide business-to-business directories which are 
not distributed to all telephone subscribers in the region; the 
recipients of the defendants' solicitations had not previously 
contracted with the defendants for placement of a yellow page 
advertisement or listing and the defendants are not affiliated 
with the New England Telephone Company, NYNEX, AT&T or the local 
phone company. 

The complaint seeks restitution for consumers, injunctive 
relief and civil penalties. 

Commonwealth v. Markline International, Inc. 

On December 16, 1993, the Division obtained a consent judgment 
against Markline International, Inc., an East Weymouth catalog 
company, and its president, Robert D. Montague. The Commonwealth 
alleged that Markline had accepted payments from consumers, but 
had failed to ship merchandise to consumers, or honor its promise 
to return payments to consumer who were not completely satisfied. 

Under the consent judgment, the defendants were required to 
pay $9,000 in restitution to more than 100 consumers from around 
the country. The consent judgment also enjoins the defendants 
from accepting payments and then failing to deliver the 
merchandise or make refunds as alleged in the Commonwealth's 
complaint . 

Commonwealth v. Direct American Marketers, Inc. 

On December 21, 1993, the Division filed a settlement 
agreement in Suffolk Superior Court with Direct American 
Marketers, Inc., a California-based sweepstakes promoter, who 
allegedly misled up to 15,000 Massachusetts consumers into 
believing they had won $7,500. Direct American agreed to return 
up to $250,000 to Massachusetts consumers who participated in a 
"900" number sweepstakes promotion. As part of the promotion, 
consumers received a reproduction of a check that made consumers 
believe they were the winners of $7,500. The back of the check 
revealed that the odds of winning were one in five million. 
Approximately 15,000 consumers called a "900" number to determine 
if they were actual winners. 



106 



In addition to paying up to $250,000 in restitution to 
consumers, the defendants also agreed to pay a minimum of $25,000 
in costs to the Office of the Attorney General. 

Millennium Telecom Agreement 

On February 15, 1994, the Division reached settlement with 
Millennium Telecom, a Hawaii-based promoter of an alternative 
long-distance telephone service who had allegedly tricked 
consumers into authorizing a switch to its telephone service. 
Millennium set up an unmanned booth at a travel show, offering a 
drawing for a 7 night Hawaiian vacation for two, including 
airfare, luxury room and $1,000 in cash. More than 2,000 
consumers filled out entry forms. Only in fine print on the form 
was a disclosure that the consumer was granting permission to 
Millennium to switch the consumer to a different long-distance 
telephone carrier. To settle the matter. Millennium agreed not 
to change the long-distance service for consumers who had filled 
out the entry forms, and to use the entry forms solely for the 
drawing of the Hawaiian vacation. 

Commonwealth v. Kenneth Chobot and Kevin Chobot 

On March 30, 1994, the Division filed a complaint against 
Kenneth and Kevin Chobot, two West Brookfield brothers for 
alleged violations of the state's consumer protection and 
environmental laws. The complaint alleged that the defendants 
approached elderly consumers and offered to cut and remove trees 
from their lots, pay the consumers for the wood, and clean up the 
site after the timber had been removed. Once the wood was 
removed, the defendants would disappear without repairing the 
site or compensating the consumers for the wood. 

In the Matter of National Safety Associates 

Also on March 30, 1994, the Division filed an assurance of 
discontinuance with National Safety Associates, a Tennessee-based 
multilevel distributor of water treatment devices. The 
Commonwealth alleged that several independent dealer/distributors 
of the defendant committed unfair and deceptive acts in the sale, 
distribution and promotion of the water treatment devices. Under 
the terms of the assurance, the defendant agreed to pay $28,000 
to the Local Consumer Aid Fund, as well as agreeing to future 
compliance with the state's Consumer Protection Act. 

Comm. V. Authorized Cleaning Services, Inc. 

On April 8, 1994, the Division filed suit against Authorized 
Cleaning Services, Inc. and its principal, George Wayne MacLeod, 
for allegedly using unfair and deceptive acts and practices in 
the sale of carpet and furniture cleaning services. 
Specifically, the complaint alleges that the defendants used bait 
and switch tactics, charged more than the advertised or agreed 
upon price for services, added unauthorized charges to consumers' 
credit cards, failed to honor guarantees, failed to provide 
refunds and performed shoddy work. 



107 



The Commonwealth is seeking a court order prohibiting the 
defendants from engaging in these acts and practices, as well as 
ordering restitution to injured consumers, civil penalties and 
costs . 

In the Matter of Fretter 

On April 11, 1994, the Division filed an assurance of 
discontinuance entered into by the Fretter chain of appliance and 
electronic stores and its advertising agency, settling 
allegations that they violated Federal Trade Commission 
guidelines in airing a television commercial featuring misleading 
customer testimonials. The ads featured five actual customers 
extolling the virtues of Fretter, while making derogatory remarks 
about Circuit City and other Fretter competitors. The ad failed 
to disclose that each participant had been promised a payment of 
$700 before the commercial's taping, if their comments were used. 

Under the terms of the settlement, $50,000 will be paid to the 
Local Consumer Aid Fund and an additional $6,500 will be paid to 
print consumer education materials. 

Comm. V. Russ Movers, et al . 



On April 20, 1994, the Division filed a lawsuit against a 
Maiden-based moving and storage company and its principals, that 
allegedly improperly moved and stored consumers ' property and 
were operating without the requisite licenses and certificates. 
The Commonwealth sought to prohibit the defendants from operating 
a moving and storage company in the Commonwealth, and obtain 
restitution for consumers as well as civil penalties. 

On April 26, 1994, the Division obtained a preliminary 
injunction against the defendants, barring them from operating 
their business without the licenses, bonds and common carrier 
certificates required by law. 

In the Matter of Roy Parkes d/b/a Shoppers Sampler ; 
In the Matter of Shawn Pieterse d/b/a Shoppers Sampler 

On May 2, 1994, the Division filed assurances of 
discontinuance against two individuals involved in the 
solicitation and sale of the Shoppers Sampler coupon circular. 
Roy Parkes, of South Yarmouth and Shawn Pieterse of New 
Hampshire, produced and marketed the Shoppers Sampler coupon 
booklet in the Nashoba Valley area. The Commonwealth alleged 
that misrepresentations were made in the marketing, soliciting 
and sale of the coupon books to Massachusetts consumers. 
Pursuant to the assurances, the defendants agreed to provide 
$2,200 in restitution to affected consumers. Parkes and Pieterse 
have also agreed not to make misrepresentations in any future 
coupon book solicitations or sales. 

Delaware v. New York 

On June 16, 1994, the Division, in conjunction with the State 
Treasurers office and the Governor's office, announced that 
Massachusetts and New York had settled a dispute over unclaimed 



108 



interest and dividends on securities that New York had improperly- 
escheated from Massachusetts-incorporated securities brokers. 
The settlement resulted in a total payment of $23.2 million to 
the Commonwealth and resolves Massachusetts' claims against New 
York in the U.S. Supreme Court case Delaware v. New York . 

OTHER INITIATIVES 

Hospital Merger Guidelines 

On August 19, 1993, the Division released guidelines on 
hospital mergers. The guidelines are designed to clarify 
antitrust law as it applies to hospital mergers in Massachusetts. 
Specifically, the guidelines address horizontal mergers and 
similar transactions among acute care hospitals. They set out 
the method of review used by the office so that parties will know 
ahead of time what the office's position on a particular 
transaction may be. 

The Division has used these guidelines to review two mergers, 
in addition to the Beverly / Addison Gilbert merger discussed 
above, and determined that there was no cause to challenge the 
mergers . These two mergers involved Goddard Memorial Hospital 
and Cardinal Gushing General Hospital and Brigham & Women's and 
Massachusetts General Hospital. 

Spanish Cite Your Rights Cards 

As part of National Consumers Week (October 25 - 29, 1993), 
the Division released its popular "Cite Your Rights" cards in 
Spanish. The cards explain Massachusetts consumer law in 11 
topic areas, including car sales and repairs, return policy, debt 
collection harassment, security deposits and defective goods. 

Report on Passive Smoke in Fast Food Restaurants 

On November 8, 1993, the office, joined by 15 other states, 
released a preliminary report recommending that fast food chains 
take steps to ban smoking in their restaurants. The report, 
"Fast Food, Growing Children and Passive Smoke: A Dangerous 
Menu, " emphasized the dangerous effects of passive smoke on 
children, who make up 25 percent of the customers and 40 percent 
of the employees of fast food restaurants. 

Federal Mortgage Escrow Rules 

On February 1, 1994, Attorney General Harshbarger and the 
Attorney's General from 21 other states filed comments in strong 
support of proposed home mortgage escrow rules that will benefit 
homeowners . The proposed rules make clear that the amounts 
demanded by mortgage lenders for escrow accounts cannot exceed 
either the limits established by the federal Real Estate 
Settlement Procedures Act (RESPA) or the underlying mortgage 
contract, that consumers are entitled to fair procedures in the 
handling of escrow surpluses and shortages, and that the quality 
and content of information provided to consumers about their 
escrow accounts must be improved to ensure compliance by lenders 
and servicers . 



109 



FCC Cable Television Rate Freeze 

On February 18, 1994, the Commonwealth and 21 other states 
joined in an amicus brief in support of the Federal Communication 
Commission's extension of the rate freeze for basic cable 
television service. The rate freeze, which was set to expire on 
February 15, 1994, was extended by the FCC until May 15, 1994, to 
allow the Commission time to promulgate further rate regulations. 
Subsequent to the FCC ' s order, Intermedia Partners and the Cable 
Telecommunications Association filed an emergency motion in the 
U.S. Appeals Court for the District of Columbia Circuit, seeking 
to block the FCC extension. (Note: The Appeals Court denied 
Intermedia's motion and allowed the extension.) 

Report on Compliance with the Free Health Care Notice Law 

On April 14, 1994, the Division issued a report detailing 
hospitals compliance with the Massachusetts uncompensated care 
pool statute and related laws requiring that hospitals apprise 
low-income citizens of the right to apply for necessary medical 
care under the state free health care program. 

The report found that, while many Massachusetts hospitals are 
in compliance with all or most of the legal notification 
requirements, there remains clear room for improvement and 
greater attention to these requirements by a number of 
Massachusetts hospitals. In general, notwithstanding the 
technical nature of some of the rules, the report found that 60 
percent of hospitals were out of compliance with one or more of 
the state or federal posting or notice requirements, while 40 
percent of all hospitals were in full compliance. 

Report on Cigarette Sales to Minors 

On April 27, 1994, the Division released a report detailing 
the findings of a statewide survey of retailer compliance with 
the laws prohibiting the sale of tobacco to minors. As part of 
the survey, young people between the ages of 13 and 17 attempted 
to purchase tobacco products at stores in communities throughout 
the Commonwealth. The students were successful in buying 
tobacco products 159 out of 248 times, or 64 percent of the time. 
The survey was conducted at 109 stores in 23 different 
communities throughout the Commonwealth. 

In addition to describing the survey methodology and results, 
the Attorney General's report details a number of steps that his 
office has already taken to reduce the sale of cigarettes to 
minors in the Commonwealth and makes specific recommendations to 
tobacco retailers about practices and procedures that should be 
implemented to minimize the illegal sale of tobacco to minors. 
The report also discusses a number of other innovative approaches 
that have been experimented with elsewhere in the effort to 
reduce teen smoking and warrant further examination. 



CONSUMER COMPLAINT SECTION 

The Attorney General's Consumer Complaint and Information 
Section provides individual help for consumers by mediating 
disputes with merchants and businesses; operates a telephone 
consumer information line that responds to thousands of consumer 
inquiries each year; and identifies developing trends and 
consumer scams for further legal action by the Division. 

During fiscal year 1994, the Consumer Complaint and 
Information Section opened 4,587 complaints for mediation and 
closed 1,961 cases. As a result of the Section's mediation 
efforts, consumers recovered direct refunds of $89,294; services 
or goods valued at $197,051; and $113,764 in savings from 
negotiated settlements of disputes with merchants. The total 
monetary benefit for consumers was approximately $400,110. 

In addition, the clerical staff screened and processed over 
3,947 written complaints and referred approximately 189 cases to 
other divisions within the attorney general's office; 265 to 
other state or local agencies; 2,214 to local consumer programs, 
and 155 to out-of-state offices. The remaining complaints were 
returned to consumers because they involved issues that were 
beyond the jurisdiction of the attorney general's office or were 
private legal matters. 

Consumer information specialists and mediators on the attorney 
general's consumer "hot line" responded to approximately 90,660 
phone inquiries this past year, providing consumers with general 
information, educational pamphlets and guidelines, complaint 
forms, and referrals to appropriate federal, state, and local 
agencies . 

Special projects and actions undertaken this year include the 
Complaint Section's Home Improvement Task Force which identified 
and mediated over 100 cases involving unregistered home 
improvement contractors; the Take-A-Break Student Travel action 
where mediators provided information for and intervened on behalf 
of over 900 distressed college students and parents to provide 
safe and timely flight services and accommodations; and the 
initiation of a Complaint Section Telemarketing Project to 
identify and pursue fraudulent telemarketing schemes. Since 
January 1994, mediators have resolved 150 complaints against 
telemarketers - over 75% from elderly citizens - and recovered 
approximately $22,000 for these consiimers . 



Ill 



LOCAL CONSUMER PROGRAM 
FACE-TO-FACE MEDIATION SERVICES 

The Local Consumer Program/Face-to-Face Mediation Services 
are responsible for the administration of the Local Consumer Aid 
Fund (LCAF) . The LCAF supports the state-wide network of 
nineteen Local Consumer Programs and eight Face-to-Face Mediation 
Programs through annual grants for the resolution of consumer 
problems. The Local Consumer Program Coordinator and Mediation 
Services Coordinator and Assistant Coordinators provide 
continuing support to grant recipients. The LCPs and FTFMPS, 
working in cooperation with the Office of the Attorney General, 
resolve thousands of complaints each year, and also identify 
patterns of unfair and deceptive acts and practices in the 
marketplace . 

Funding for the local programs is allocated by the General 
Court pursuant to G.L. c.l2 IIG. In fiscal year 1994, $605,393 
was appropriated by the legislature to the LCAF. Ten percent of 
that figure ($60,539) was retained by the Office of the Attorney 
General for administrative purposes. 

In 1994, the nineteen local consumer programs handled over 
11,000 written complaints, recovering over $2.8 million for 
consumers in the Commonwealth. The eight face-to-face mediation 
programs held 1266 mediations, with 972 agreements made, for a 
settlement rate of 77%. 

In addition to its consumer complaint resolutions, the 
Mediation Services program has continued to implement its school- 
based mediation project. Student Conflict Resolution Exerts 
(SCORE) . There are now 20 schools taking part in the program, 
and the Office of the Attorney General has provided $212,000 in 
funding to these programs, from settlements in consumer and other 
cases and $75,000 in funds from the Mass. Committee on Criminal 
Justice. In 1993/94, 1500 mediations were held in these 
programs, 98% resulted in agreements. Mediation services also 
provided Conflict Intervention Team services to Somerville High 
School and English High School. 

In June 1993, the Charles Hayden Foundation of New York gave 
$75,000 to SCORE and Metropolitan Mediation Services (MMS) to 
pilot a 3 -year comprehensive violence prevention program at 
Boston English's High school in Jamaica Plain. The Mass. 
Committee on Criminal Justice awarded Mediation Services with a 
$75,000 grant for SCORE programs at Haverhill High School, 
Taunton High School, Maiden High School, Dorchester High School, 
and the Grover Cleveland Middle School . 

The SCORE program and CIT have had the honor of being selected 
as finalists in the Ford Foundation's Innovations in State and 
Local Government award. 



112 



CIVIL RIGHTS DIVISION 

BIAS MOTIVATED AND OTHER CIVIL RIGHTS ACT CASES 

The Civil Rights Division has continued to actively enforce 
the Massachusetts Civil Rights Act, which authorizes the Attorney 
General to seek injunctive relief when the exercise of legal 
rights is interfered with by threats, intimidation, or coercion. 
In fiscal year 1994, the Division continued to combat violence 
and discrimination by obtaining a total of thirteen injunctions 
against 3 6 defendants who had interfered with the rights of 
Massachusetts residents on the basis of race, color, national 
origin, sexual orientation, and gender and to protect the First 
Amendment rights of a reporter and a member of a School Committee 
to expressing their views on controversial racial matters within 
their community. 

In what may be the first use of a civil rights statute in 
combating domestic violence, the Division obtained a precedent- 
setting preliminary injunction against a man who engaged in an 
alleged pattern of gender-based and hate-motivated threats, 
intimidation, and violence against four separate women over a 
three year period. Each woman is alleged to have been 
systematically deprived of her most basic rights through a 
pattern of verbal and physical abuse. Because the defendant was 
motivated by his alleged bias against women as a class, the 
Division argued that the abusive treatment of these women 
violated the Massachusetts Civil Rights Act. As a result of the 
injunction, any further threats or intimidation by the Defendant 
against women whom he is dating, could result in a substantial 
prison sentence. 

In other significant cases, the Division obtained injunctions 
against four males who terrorized an elderly woman with 
Parkinson's disease and her Haitian-American visiting nurse. The 
Division also obtained criminal indictments against an alleged 
member of the White Youth League, a racist skinhead group, for 
violating a civil rights injunction obtained by the Division in 
1991. 

HOUSING DISCRIMINATION 

The Attorney General's Civil Rights Division has acted on its 
commitment to ensuring fair housing by filing, prevailing at 
trial, or settling 32 cases of housing discrimination involving 
allegations of discrimination on the basis of race, familial 
status, marital status, receipt of a housing subsidy, gender, and 
sexual orientation. 

The Division has intervened in ten separate housing 
discrimination suits pending before the Massachusetts Commission 
Against Discrimination. These cases involve ten separate real 
estate agents in the Brookline and Newton area who have allegedly 
engaged in a practice of steering tenants with young children 



113 



away from rental units with lead-based paint, thereby shielding 
landlords from the statutory obligation to delead rental units 
occupied by families with children under six years of age. By 
intervening in these cases, the Attorney General hopes to modify 
realtor practices, to educate tenants about the right to fair 
treatment in the housing market and to enlarge the pool of safe, 
affordable housing for families with children. 

On March 15, 1993, a Single Justice of the Supreme Judicial 
Court issued a precedent-setting decision granting summary 
judgment in favor of the Attorney General's Office and the Town 
of Barnstable. The Single Justice ruled that Old King Highway 
Regional Historic District Commission had no authority to 
litigate a case which had effectively halted construction of a 
3 6-unit affordable housing development for low income elderly 
individuals or families in Barnstable. The Court's holding that 
the chief executive of a city or town can control a town board's 
decision as to whether to challenge an affordable housing project 
in that city or town, will provide substantial protection against 
opposition to the construction of such projects statewide. On 
December 14, 1993 the Supreme Judicial Court affirmed this 
decision . 

In the case of Commonwealth v. Desilets , the Commonwealth 
alleged that the defendants had discriminated against an 
unmarried couple by refusing to rent an apartment to them based 
upon their marital status. The Attorney General filed an appeal 
to overturn a Superior Court judgment which exempted the 
defendants from compliance with the fair housing laws, based upon 
defendants' claim that their religious convictions prevented them 
from renting to the couple. 

The Attorney General's Office filed an appeal to overturn the 
Superior Court's ruling, arguing that the defendants' voluntary 
entry into the business of owning and renting residential 
property subjected them to the fair housing law, and that the 
Defendant's practice of religion was not burdened by the 
application of those laws. 

In July of 1994, the Supreme Judicial Court ruled on the case, 
holding that the Commonwealth must show a compelling interest in 
eliminating housing discrimination against cohabiting couples 
that is strong enough to justify the burden placed on the 
defendants' exercise of their religion. The Court remanded the 
case to the Franklin Superior Court for a hearing on that issue. 

In an Appeals Court decision. Commonwealth v. Robert and 
Florence Dowd , the trial court had awarded substantial attorneys' 
fees to the Attorney General, after he prevailed in a claim of 
housing discrimination based on marital status. The decision was 
appealed and in August of 1994 the Appeals Court ruled that 
because of limiting language in the statute, the Attorney General 
may not receive an award of attorneys' fees under General Law c. 
151B. 



114 



EMPLOYMEKT DISCRIMINATION 

In July 1994 the Division moved to intervene in cases filed 
before the Massachusetts Commission Against Discrimination, 
alleging that Bull HN Information System had discriminated 
against numerous former employees on the basis of their age, in 
violation of the state anti-discrimination act. The MCAD 
subsequently allowed the Attorney General's motion to intervene, 
which alleges that Bull HN engaged in a pattern of age 
discrimination in employee layoffs conducted since 1990. It is 
alleged that Bull HN has terminated older employees or forced 
them into early retirement while retaining and hiring younger 
employees . 

MORTGAGE LENDING DISCRIMINATION 

Since November 1992, Attorney General Harshbarger ' s Civil 
Rights Division has been involved in a comprehensive attack on 
fair lending barriers in the home mortgage lending industry in 
Massachusetts . 

In March 1994, in what may serve as a model for fair lending 
practices, the Attorney General and the Massachusetts Bankers 
Association and 27 banks and mortgage companies entered into an 
unprecedented and far reaching agreement to effect systemic 
reform of the mortgage lending industry in Massachusetts. 

The three year agreement stems from an investigation conducted 
by the Attorney General's Office which was prompted in large part 
by a 1992 study conducted by the Federal Reserve Bank. That 
study found that black and hispanic applicants were denied 
mortgages at a rate 60 percent higher than whites with similar 
financial circumstances and credit histories. Under the three- 
year agreement, the MBA has agreed to establish six programs and 
initiatives to discourage mortgage lending bias. These include: 
a college level program to train and recruit minorities for 
employment in the mortgage lending industry, including a student 
apprenticeship program; the organization and sponsorship of a 
comprehensive statewide credit and homebuyer educational program; 
the development of a comprehensive diversity, fair lending 
training module; the promotion of legislation that will encourage 
banks to undertake self -testing and comparative file reviews; and 
an agreement to jointly work for legislation for which would 
create state co-insurance for nonconforming loans. 

The MBA has also agreed to ensure and to encourage its two 
hundred members to adopt internal practice changes including 
establishing a complaint management system, an ombudsperson to 
investigate complaints and internal second review programs; and 
designing a loan origination compensation structure that promotes 
low and moderate income lending. 

The Attorney General and the MBA also announced the 
appointment of a three-member panel of banking experts who will 



be responsible for the review of certain previously denied 
minority loan applications. The panel will review up to 120 
minority applications from 24 separate institutions which the 
Federal Reserve identified in its 1992 study as potentially 
having been denied on an inappropriate basis. If the panel finds 
that any of the application were denied for discriminatory 
reasons, the applicant will be offered the choice of a $15,000 
settlement, a refinancing of their present mortgage or a new 
mortgage loan. 

The Attorney General also reached an agreement with First New 
Hampshire Mortgage Corp., one of the Commonwealth's largest 
residential mortgage lenders, to increase the company's 
relatively low number of minority loan applications. First NH 
agreed to establish model residential lending programs in 
Springfield and the Lowell, Lawrence, Haverhill areas as well as 
to make certain changes in the manner in which it handles 
residential loan applications in Massachusetts. 

The Division Chief also served as a presenter in two national 
mortgage lending discrimination conferences; one sponsored by the 
U.S. Department of Housing and Urban Development in January 1994 
and the other by the National Community Reinvestment Coalition in 
February 1994. 

POLICE RELATED MATTERS 

In a cooperative effort to promote civil rights, assist the 
police, and provide departments with technical assistance, the 
Attorney General's Civil Rights Division has continued to provide 
an extensive amount of civil rights training to police 
departments about subject matters including civil liability, 
sexual harassment, cultural awareness, hate crimes, and health 
clinic blockades and invasions. The Division has led or 
participated in many training sessions throughout Massachusetts 
including in the towns of Shrewsbury, Lincoln, Lowell, Woburn, 
Winchester, as well as at the State Police, Middlesex and 
Southeastern Massachusetts Police Academies. The Division also 
participated in the campus law enforcement statewide training 
program, sponsored by the Attorney General in January 1994. 

The Division has also continued to investigate allegations of 
police misconduct and issue comprehensive reports, and has worked 
with departments to take remedial steps when credible evidence is 
found to substantiate the complaints. As a result of the 
Division's investigation of certain practices of the Chatham 
Police Department, the Board of Selectman in the Town of Chatham 
established a Community Advisory Committee to assist the police 
in more effectively serving that community. 

The case of Commonwealth v. Adams , was a civil rights suit, 
filed in 1989, alleging that thirteen Boston Police officers used 
excessive force during the arrest of a motorist following a chase 
which ended in Brookline. After a two-week trial in January 1992 



the Suffolk Superior Court issued a civil rights injunction 
against the individual police officers who had used excessive 
force during the arrest. A Supreme Judicial Court decision 
issued in December 1993 affirmed the court-ordered injunction, 
issued under the Massachusetts Civil Rights Act. 

In May of 1994, after extensive negotiations initiated by the 
Attorney General, a modified final judgment by agreement 
involving all of the defendants, was entered. Under the terms of 
the agreement, the injunction will be vacated as of December 31, 
1994. The parties also agreed to special supervision, training 
and reporting requirements through December 31, 1996. 

OPERATION RESCUE 

In response to numerous "rescue blockades" and clinic 
invasions that took place at Massachusetts health clinics which 
provided abortion and counseling services, in 1989 the Office 
filed a motion to join the ongoing case of Planned Parenthood v. 
Operation Rescue . A preliminary injunction was issued against 
Operation Rescue and other defendants in May 1990. After a two- 
week trial in Superior Court in 1991, a Permanent Injunction was 
issued against members of Operation Rescue which prohibited the 
blocking of entrances to clinics which provide abortion services 
and counseling. This injunction was appealed by the Defendants. 

In April 1994, the Supreme Judicial Court issued a precedent- 
setting decision which affirmed the trial court's permanent 
injunctive order against clinic blockades and invasions by the 
defendants. The decision is a vital enforcement tool both 
because of the penalties available to law enforcement for 
violation of the order and because the injunction is broad in 
scope, prohibiting the defendants not only from blockading 
clinics, but also from directing and instructing others to 
blockade clinics. 

As a result of this and earlier injunctions, 18 individuals 
have been found guilty of criminal contempt for violation of the 
court's order and no blockades have taken place since September 
1992. In 1994, a Clinic Access Law was enacted by the State 
Legislature which has made it a crime in Massachusetts to 
blockade clinics. 

GANG PROJECT ANNOUNCEMENT 

The Attorney General has announced his intention to use the 
Massachusetts Civil Rights Act as a tool against gangs who are 
engaged in a pattern of threats and intimidation and who prey 
upon law-abiding residents in Massachusetts. In appropriate 
cases referred to the Division in the future, the Division will 
strongly consider filing an MCRA action against gang members 
whose terrorizing acts clearly deprive others of their most 
fundamental rights and freedom 



117 



LEGISLATIVE INITIATIVES 

The Attorney General sponsored a bill to provide to the 
Attorney General in civil rights enforcement actions the 
authority to obtain compensatory damages on behalf of victims of 
civil rights violations and to collect the costs of litigation 
and reasonable attorneys' fees. Under the proposed bill, courts 
would also have the discretion to order a civil penalty against a 
defendant for violation of the civil rights law. The bill also 
provides that any civil penalties, attorneys' fees and costs that 
are recovered would be deposited in a special state fund to 
finance future civil rights actions by the Attorney general, to 
fund community education, and to finance the development and 
implementation of model civil rights and law enforcement training 
programs . 

A law review article titled, "The Attorney General's Sponsored 
Bill to Amend the Massachusetts Civil Rights Act," co-authored by 
Attorney General Harshbarger and his Chief of his Civil Rights 
Division, published in the Boston University Public Interest Law 
Journal in the fall of 1993, discussed the proposed legislation. 

OTHER SIGNIFICANT DIVISION INITIATIVES 

In January 1994, the Attorney General's Civil Rights Division 
along with representatives of the U.S. Attorney's Office, 
District Attorneys' offices, local and state police departments, 
and the Federal Bureau of Investigations committed their 
resources and expertise to the formation of the 

Law Enforcement Hate Crimes Task Force . The Task Force members 
decided that the Civil Rights Division should serve as the 
central repository for all materials related to organized hate 
group activities in Massachusetts. The Division also developed 
an Intelligence Manual which summarizes all intelligence 
information collected related to organized hate groups and other 
hate crime activity in Massachusetts. The Task Force will focus 
on identifying organized hate groups, sharing information and 
expertise on hate groups, and coordinating federal and state law 
enforcement efforts to prosecute hate crimes at both the state 
and federal level. The Task Force is chaired by the Chief of the 
Civil Rights Division. 

The Chief of the Division also participated as an active 
member of the Supreme Judicial Court Commission on Race and 
Ethnic Bias in the Courts , including involvement in public 
hearings and participation in the drafting and editing of the 
final report. The final report is scheduled to be issued on 
September 21, 1994 

The Division Chief chaired, and division staff served as 
active members of the Boston Prosecutors-Police Civil 
Rights Task Force which coordinates the resources of local, 
state, and federal agencies to address civil rights issues 
arising in Boston. The Task Force addressed civil rights 



118 



harassment in South Boston and responded in a coordinated fashion 

to reported racial incidents in Charlestown. The Task Force has 

also met to develop strategies to apply civil rights laws to 

gang-related issues within the Boston Housing Authority projects. 

The Division also chaired an office-wide AIDS Privacy Task 
Force whose initiatives include outreach, legal research, 
developing priorities in regard to legislation, litigation, and 
confidentiality issues. 

DISABILITY RIGHTS PROJECT 

In June 1993, Attorney General Scott Harshbarger announced the 
establishment of the Disability Rights Project within the Civil 
Rights Division of this Office. With the inauguration of this 
Project, the Office of the Attorney General substantially 
expanded its ability to guard and enforce the rights of 
individuals with disabilities. Significantly, the Attorney 
General placed the Project within the Civil Rights Division to 
underscore the critical message that disability rights are civil 
rights . 

Since the announcement, the Project has been actively involved 
in a community education effort to increase public awareness 
about the establishment of the Project and disability law. The 
Project's audiences have included disability rights advocates, 
municipal officials and business owners. 

The Project has three priority areas: A) access to municipal 
events and services, B) fair housing rights for individuals with 
disabilities and C) access to and non-discrimination by private 
entities. In each of these priority areas the Project has been 
able to achieve solid results, all of which have been attained 
without having to file suit. 

The Project's efforts to increase access to municipal events, 
services and programs have been very successful. The Project 
received complaints from the citizens in the following 
municipalities: Canton, Carver, Chelsea, Clinton, Easthampton, 
Hingham, Marshfield, Sheffield, Southboro, Sturbridge, Templeton, 
Wareham and Woburn, who complained that the public meetings were 
being conducted in physically inaccessible locations. In each 
instance, the Disability Rights Project contacted municipal 
officials and requested that they cease convening public meetings 
in those locations. In each instance the officials responded by 
immediately moving all open meetings conducted by the local 
committees and boards to alternative accessible facilities. The 
Project has also worked with the towns to establish policies 
which ensure that all municipal services are provided in an 
accessible manner. In addition, a number of towns, including 
Canton, Clinton, Marshfield, and Woburn, have allocated 
substantial s\ims of money for accessible renovations that will 
afford access to their town building. 



119 



The Project had significant accomplishments in the area of 
affording access to and non-discrimination by private businesses. 
Businesses have been utilizing the Project in a consulting 
capacity as they move forward to build or reconstruct their 
facilities to afford access and redraft policies to ensure non- 
discrimination against individuals with disabilities. The 
Project has sought to respond to complaints against companies in 
a nonadversarial manner which has enabled us to resolve the 
issues successfully without litigation. For example, the Project 
received a complaint that an individual who is deaf experienced 
difficulty in attempting to obtain services at New England 
Telephone's (NET'S) service center in Hyannis. The individual 
sought to clarify a billing dispute. Typically, a customer can 
resolve such issues by using a free phone in one of the company's 
service center to talk to a supervisor. When this individual 
indicated his need to use a TTY (text telephone), he was informed 
that the customer service center did not have a such equipment. 
The Project's follow-up factual investigation revealed that none 
of the phone centers were equipped with TTYs . 

When the Disability Rights Project contacted New England 
Telephone, the Company immediately responded to the issue, 
proposing a solution which not only served the needs of 
individuals in Massachusetts, but throughout the Company's five- 
state service area. NET agreed to install TTYs in each of the 21 
Customer Service Centers throughout New England. 

In another case, the Project reached a settlement with 
Plymouth Brockton Bus Co. (P & B) in which they agreed to modify 
their policy and practice for provision of accessible bus 
service. The issue was brought to the Project's attention 
growing out of a concern that P & B's existing policy of 
requiring a 24 -hour advance reservation prevented persons with 
disabilities from effectively being able to use P & B. The 
problem was particularly acute when members wished to use 
accessible buses going to and from the airport or Boston. After 
a series of meetings with P&B, the agreement provided for a much 
shorter advance reservation requirement and other contingent 
arrangements so that individuals needing accessible bus service 
would avoid the risk of being stranded in Boston or at the 
airport . 

Private universities are also covered under this priority 
area. An early complaint concerned a local university's plan to 
hold their paralegal graduation in an inaccessible location. 
Although the woman herself could have, with difficulty, managed 
to attend the ceremony, several of her closest friends would have 
been precluded from attending the event. When the Project 
contacted the school's counsel, the school immediately agreed to 
move the graduation to a physically accessible location. 

In the third priority area, the Project has worked to enforce 
fair housing rights for individuals with disabilities, 
particularly those who encounter opposition to their desire to 



120 



reside in the community of their choice. For instance, this 
office was contacted by representatives of Hope House concerning 
problems they experienced in connection with their attempt to 
develop a 10 person residence in Fall River for individuals 
diagnosed with AIDS. Their greatest obstacle was the City's 
zoning ordinances which interfered with the establishment of 
group residences in Fall River by limiting such groups to four 
unrelated persons living together without a special permit 
process. The Project sent a letter to the City Solicitor which 
discussed how state and federal laws applied to the Fall River 
ordinance. As a result of the letter, the City determined that 
Hope House was not subject to the ordinance, and issued a permit 
allowing the project to go forward. 

A woman with a seizure disorder contacted this Office when her 
landlord threatened to evict her, based upon the presence of a 
dog in her unit, in violation of the building's "no pet" rule. 
The complainant asserted that the dog had the ability to forewarn 
her of seizures. State and federal law requires that landlords 
make a reasonable accommodation in their rules, policies or 
procedures to ensure that an individual with a disability had an 
equal opportunity to use and enjoy a dwelling. (M.G.L. Ch. 151B 
§4). After learning of a kennel that trains and certifies 
seizure dogs, the Project put the complainant and kennel in touch 
with each other. Within a week, the kennel had certified the 
complainant's dog as a Seizure Alert Dog and initiated a 
"continuing education and training" program. The complainant 
provided the landlord with the dog's certification and may now 
stay in the apartment. 

When Attorney General Scott Harshbarger announced the 
establishment of the Disability Rights Project, he specifically 
emphasized the importance of community education. To that end, 
the Project has conducted numerous informational sessions on the 
Project and have presented many trainings on disability law. 
Some of the notable events include: A) welcoming remarks and talk 
on the Disability Rights Project at a conference for individuals 
of color with disabilities, social service agencies and 
businesses serving that community, B) served as keynote speaker 
to 300 people at the Annual Consumer Conference sponsored by 
Massachusetts Rehabilitation Commission, C) presented ADA update 
at annual convention of Town Counsel and City Solicitors, D) 
presentation on the ADA and Libraries Seminar sponsored by the 
Social Law Library, E) wrote a chapter on Title II of the ADA and 
Municipal Law for inclusion in MCLE book on Municipal Law, and F) 
wrote a chapter on Legal Rights of Individuals with Disabilities 
in the School Context for MCLE on School Law and was panelist at 
MCLE conference. 

In an effort to further assist the individuals who contact the 
Project for information and assistance, the Project has prepared 
materials which address such subjects as municipal law, school 
law, employment rights of individuals with disabilities, and 



121 



questions and answers on Title II of the Americans with 
Disabilities Act. 

The work of the Disability Rights Project has been well 
received by the disability community. In fact, Attorney General 
Scott Harshbarger was awarded the first annual Access Plus Award 
by the Stavros Independent Living Center for his role in 
furthering independence for people with disabilities, for 
promoting their civil rights and for initiating the Disability 
Rights Project in his office. 



122 



ENVIRONMENTAL PROTECTION DIVISION 

The Environmental Protection Division (EPD) serves as 
litigation counsel on environmental issues for various state 
agencies, particularly those within the Executive office of 
Environmental Affairs. EPD handles the Commonwealth's civil 
litigation to enforce environmental protection programs 
established by state statutes and regulations, including laws 
governing air pollution, water pollution, water supply, 
waterways, wetlands, hazardous waste and solid waste. In 
addition, EPD is responsible for the Commonwealth's asbestos cost 
recovery litigation and matters arising from the operation of 
nuclear power plants. Based on the Attorney General's broad 
authority to protect the environment of the Commonwealth, EPD 
initiates and intervenes in state and federal litigation, and 
participates in administrative hearings before federal agencies 
on significant environmental issues. 

Money ordered to be paid to the Commonwealth: 

Hazardous Material Cost Recovery: $14,318,407 

Civil Penalties and Payments: $ 922,000 

Asbestos Cost, Recovery/Damages: $15,063,000 

Other (costs paid to Consumer Aid Fund) $ 15,000 

TOTAL: - $30,318,407 

Money Saved the Commonwealth: 

Many cases resulted in court judgments requiring private 
parties to undertake costly cleanups - a savings of millions of 
dollars for the Commonwealth. 

1. STATE ENFORCEMENT 

One of the most important functions of EPD is to bring 
litigation to enforce state and federal environmental statutes. 
In the past fiscal year, EPD handled numerous major enforcement 
cases, including the following: 

A. Air Pollution 

Commonwealth v. BP Exploration & Oil, Inc.: 

This Massachusetts Clean Air Act case involved alleged 
violations arising from gasoline loading of trucks and barges. 
The Commonwealth obtained a consent judgment that requires BP to 
install state-of-the-art air emissions control equipment, enjoins 
further violations of the Clean Air Act, requires payment of a 
$200,000 civil penalty, and payment of $75,000 to the 
Massachusetts Environmental Trust. 



Conmaonwealth v. Roche Bros. Barrel & Drum Co., Inc.: 

The Commonwealth alleged that Roche Brothers, a Lowell, 
Massachusetts drum reclamation, fabrication and painting 
business, illegally emitted volatile organic compounds ("VOCs") 
into the air and released hazardous materials into the ground. 
The Commonwealth obtained a consent judgment requiring Roche 
Brothers to undertake activities to reduce emissions of VOCs into 
the air and prevent the release of hazardous materials . In 
addition, Roche Brothers paid a $100,000 civil penalty pursuant 
to the Massachusetts Clean Air Act and Hazardous Waste Management 
Act. 

Commonwealth v. Ashworth Bros., Inc. 

The Commonwealth alleged that Ashworth Brothers recycled, 
treated and disposed of acetone in a manner that violated the 
Massachusetts Clean Air Act and the Hazardous Waste Management 
Act. The case was resolved by a consent judgment that requires 
Ashworth Brothers to manage its acetone and by-products in 
accordance with its recycling permit and to pay a $10,000 civil 
penalty. In addition, the settlement requires Ashworth Brothers 
to implement source reduction to reduce its use of acetone and 
water . 

Commonwealth v. P.T. Petro: 



The Commonwealth obtained a consent judgment that requires 
payment of $15,000 to the Commonwealth for alleged violations of 
the Massachusetts Clean Air Act that occurred when the defendant 
transferred gasoline from a tank truck into an underground 
storage tank without using required vapor recovery equipment. 

Commonwealth v. Marathon Enterprises, Inc.: 

The Commonwealth obtained a consent judgment in this 
Massachusetts Clean Air Act case against a gasoline distributor 
for allegedly dispensing fuel without required vapor recovery 
equipment. Marathon Enterprises paid the Commonwealth a $50,000 
civil penalty. 

B. Water Pollution/Water Supply 

Commonwealth v. Town of Ashfield: 



The Commonwealth obtained a consent judgment to resolve its 
Massachusetts Clean Waters Act claims against the Town of 
Ashfield. The consent judgment requires the Town to construct a 
wastewater collection system to serve the center of Ashfield and 
a wastewater treatment plant. 

Commonwealth v. U.S. Department of Defense : 

The Commonwealth obtained a consent decree requiring the U.S. 
Department of Defense to bring its Natick, Massachusetts facility 
into compliance with its sewer discharge permit, remediate 
mercury contamination, cease discharging cooling water into Lake 
Cochituate, and to pay $10,000 to the Commonwealth in attorneys' 
fees . 



124 



Commonwealth v. American Telephone & Telegraph CO . : 

The Commonwealth alleged that AT&T illegally discharged 
hexavalent chromium from its North Andover facility into the 
Merrimack River in violation of the Massachusetts Clean Waters 
Act and the Massachusetts Oil & Hazardous Material Release 
Prevention and Response Act. The consent judgment required AT&T 
to institute environmental training for its employees and pay a 
civil penalty of $75,000. As a result of the litigation, AT&T 
eliminated use of hexavalexit chromium as a rust inhibitor at the 
facility, and performed $900,000 worth of improvements to 
prevent such releases in the future. 

Eben S., et al . v. William S. Rafter, Jr., as he is the Mayor of 
the City of Gloucester et al . : 

This suit was brought by twenty-three citizens to stop the 
construction of pressure gravity sewers in the Annisquam area of 
North Gloucester. The Commonwealth intervened in the action 
because of concerns that the dispute would cause the City to miss 
consent decree deadlines requiring it to extend the sewer system 
to North Gloucester. The citizens and the City of Gloucester 
agreed to settle the lawsuit by allowing then Mayor-Elect Bruce 
Tobey the opportunity to evaluate two types of sewer collection 
systems when the City extends its wastewater collection system to 
the Annisquam area. 

Commonwealth v. Forrow Builders: 



The Commonwealth brought suit against the developers of a 
condominium complex that allegedly installed a failing sewage 
disposal system in violation of the Massachusetts Clean Waters 
Act and Title 5 of the State Environmental Code. The final 
judgment required the developers to construct a sewer collection 
system and, a pump station at the condominium complex, and to 
connect to the town sewer system. 

Commonwealth v. Winfield Brooks Co., Inc.: 



The Commonwealth alleged that Winfield Brooks illegally 
discharged industrial wastes into the Massachusetts Water 
Resources Authority ("MWRA") sewer system in violation of the 
Massachusetts Clean Waters Act. The consent judgment required 
the defendant to cease discharges of industrial wastewater into 
the MWRA sewer system until it obtains a new MWRA sewer use 
discharge permit. In addition, the defendant was required to pay 
civil penalties of $75,000. 

C. Hazardous Waste 

EPD brings lawsuits against responsible parties to remedy 
contamination caused by oil or hazardous materials, including 
litigation to recover costs incurred by the Commonwealth when it 
undertakes cleanup actions. In the last fiscal year, EPD handled 
the following major hazardous waste cases. 



125 



Commonwealth v. Pal-Rath Realty, Inc. and Standex International 
Corp. : 

This case involved the contamination of a public water supply 
in Palmer, Massachusetts. Pursuant to the terms of the consent 
judgment, the defendants paid $2.1 million, of which $975,000 
went to the Commonwealth and the remainder was paid to the Palmer 
Water District. The payment is reimbursement of costs incurred 
in assessing the contamination, constructing a water treatment 
plant and also the future costs of operating the treatment plant. 

U.S. V. General Chemical Corp., et al . : 

This case involves the Silresim Stiperfund site, a five-acre 
abandoned chemical waste recycling facility in Lowell, 
Massachusetts. In November, 1993, the court approved a consent 
decree that requires 23 defendants to pay the Commonwealth and 
the United States a total of $40 million for the remediation of 
the site. The Commonwealth and the United States allocated the 
proceeds of the settlement so that 38% of the proceeds will be 
paid to Massachusetts. 

Commonwealth v. Bay State Smelting Co., Inc.: 

This case involved allegations that Bay State Smelting 
illegally stored hazardous wastes at its Somerville facility, 
thereby exposing workers to contaminated lead (Just. The civil 
judgment requires Bay State Smelting to perform corrective 
measures at its Somerville facility to ensure that lead and 
other hazardous materials are properly managed, that workers 
at the facility are protected from unnecessary exposures, and 
that air emissions from the facility comply with applicable 
standards. The Criminal Bureau handled a parallel criminal 
proceeding that resulted in the defendant making a $500,000 
payment into a fund designed to assist the working poor in 
asserting their rights to a safe workplace. 

Commonwealth v. Omega Processing Co., Inc.: 

The Commonwealth alleged that this Monson electroplating 
company released hazardous materials into the Chicopee Brook. 
The electroplating facility closed immediately after the spill, 
and never reopened. The consent judgment requires Omega 
Processing to sell its only asset, the electroplating facility, 
and give the proceeds to the Commonwealth. 

Commonwealth v. Stephen Bobrow, et al . : 

The owners and developers of a shopping center in Somerville 
allegedly disposed of 40,000 cubic yards of contaminated soil at 
unlicensed disposal sites without proper approvals. The consent 
judgment requires the owners and developers to pay a $75,000 
civil penalty. 

U.S. V. Charles George, et al . : 

This case involves the Charles George Superfund site, a 
heavily contaminated landfill in Tyngsborough, Massachusetts. In 
December, 1992, the state and federal governments lodged a 
consent decree in federal court that provides for payment by a 



number of defendants of $35 million in costs and damages, of 
which approximately $12 million will go to the Commonwealth. In 
November, 1993, a second consent decree was entered in federal 
court that requires the two members of the George family, James 
and Charles, Jr., and C & J Trucking Company, to pay $3.1 million 
in response costs and natural resource damages in connection with 
the landfill. Litigation with other members of the George 
family, the only remaining defendants in the case, is ongoing. 

Commonwealth v. Mohawk Auto Wrecking, Inc., et al . : 

The Commonwealth obtained a consent judgment with Mohawk Auto 
Wrecking and other defendants that required them to pay $15,000 
to the Commonwealth for response costs incurred in connection 
with a release of oil, to comply with hazardous waste laws, 
obtain necessary licenses to collect, transport, use, dispose of 
or store hazardous waste, and to make investments to eliminate or 
reduce future risks to the environment . 

D. Wetlands 

Commonwealth v. Robert Dicore: 



The defendant allegedly willfully and repeatedly violated the 
Wetlands Protection Act and enforcement orders of the local 
conservation commission by altering wetlands on his property. 
Pursuant to a consent judgment, the defendant agreed to restore 
damaged wetlands and pay a $70,000 civil penalty. 

Commonwealth v. Point of Pines Yacht Club Inc.: 

The Commonwealth alleged that the Point of Pines Yacht Club in 
Revere, Massachusetts destroyed coastal beach and dunes with a 
front-end loader, contributing to flooding and storm damage in 
the area. The consent judgment required the yacht club to 
restore coastal dunes and beach grass on its site, enjoined work 
in wetlands on the site without proper permits, and ordered the 
yacht club to pay a $25,000 civil penalty under the Wetlands 
Protection Act. 

Commonwealth v. John Stringer: 

The defendant allegedly destroyed a habitat for wildlife by 
dismantling a beaver dam, and causing drainage of a fifteen to 
twenty acre pond. The defendant is required by a consent 
judgment to repair the dam, pay $30,000 in civil penalties to the 
Commonwealth, $2,000 to the Audubon Society and $700 to the 
Department of Fisheries, wildlife and Environmental Law 
Enforcement . 

Commonwealth v. Town of Montgomery : 

The Commonwealth brought suit against the Town of Montgomery 
for alleged violations of the Wetlands Protection Act in 
connection with a 1986 bypass construction project. Pursuant to 
a consent judgment, the Town agreed to restore altered wetlands 
areas . 



127 



Commonwealth v. Consigli Construction Co. and Matellian Family 
Trust. : 

The Commonwealth obtained a final judgment requiring 
restoration of wetlands in Upton, Massachusetts that the 
defendants allegedly filled with demolition debris. The judgment 
also required payment of $30,000 in civil penalties to the 
Commonwealth. 

E. Deceptive Environmental Advertising 

EPD and the Consumer Protection Division are involved in a 
multi-state Environmental Marketing Taskforce that has issued 
recommendations for responsible environmental advertising as well 
as taken enforcement actions in cases involving allegedly 
deceptive "green" advertising claims that certain products have 
reduced impacts on the environment. In the last fiscal year, 
Osram-Sylvania, Tnc . entered into a settlement agreement to pay 
$135,000 to the multi-state taskforce, including Massachusetts, 
and to discontinue certain advertising claims that its light 
bulbs conserve energy or otherwise provide greater benefits than 
other manufacturers' bulbs. The Commonwealth alleged that 
Sylvania promoted its "Energy Saver" incandescent bulbs as 
representing a technological breakthrough that would help 
conserve resource, when in fact, most of the energy savings 
realized from using these bulbs arises simply because they emit 
less light, not because they are more efficient. 

II. CLEAN STATE INITIATIVE 

During the past year, EPD continued to pursue Attorney General 
Harshbarger ' s clean state initiative. The clean state initiative 
seeks to ensure that the state's own facilities are in compliance 
with environmental laws and that any environmental problems at 
state facilities are addressed promptly. Last year, discussions 
between the AG's Office and Governor Weld's Office resulted in 
Governor Weld's issuance of an executive order designed to bring 
state agencies into compliance. Attorney General Harshbarger is 
monitoring implementation of the executive order. 

III. INTERVENTION IN FACILITY SITING PROCEEDINGS 

The Commonwealth intervenes in facility siting proceedings 
when it determines that intervention is necessary and appropriate 
to protect the public health or the environment. In the past 
year, EPD has been involved in ongoing proceedings in opposition 
to the siting of several coal-fired power plants that will 
produce significant amounts of air contaminants and a gas-fired 
plant. 

The Commonwealth intervened in the siting of the Inter-power 
coal-fired power plant in Halfmoon, New York, primarily because 
the plant would increase acid rain impacts in the Berkshires in 
Massachusetts. In the past year, the New York, Supreme Court, 
Appellate Division, granted the Commonwealth's petition for 



128 



review and revoked the certificate previously granted by the New 
York Siting Board to construct and operate the Halfmoon energy 
facility on the basis that the Siting Board had failed to balance 
properly the economic and environmental impacts from the project. 

EPD is also involved in ongoing power plant siting proceedings 
involving the Silver City facility in Taunton, Massachusetts, the 
Eastern Energy facility in New Bedford, Massachusetts, and the 
Allresco Lynn, Inc. facility in Lynn, Massachusetts. In January, 
1()94, the Attorney General filed an appeal with the Supreme 
Judicial Court- from the Energy Facilities Siting Board's 
conditional approval of the construction of Eastern Energy 
Corporation's proposed 3 00 megawatt power plant. 

IV. NOTICE OF NONCOMPLIANCE PROJECT 

EPD has been engaged in a joint project with the Department 
of Environmental Protection (DEP) , to review DEP ' s use of Notices 
of Noncompliance (NONs) and to assist DEP in strengthening its 
administrative enforcement. EPD and DEP together reviewed over 
100 NONs, and are working together to devise strategies to 
improve DEP's enforcement. 

V. DEFENSIVE CASES 

One of the critical functions of EPD is the defense of 
lawsuits challenging the regulatory and enforcement actions of 
state environmental officials and agencies. These cases involve 
numerous challenges to state permitting decisions, as well as 
challenges to the legality of state environmental regulations. 

For example, in American Automobile Manufacturers Association, 
et al . v. Commissioner of Environmental Protection, et al . , EPD 
is defending Massachusetts' adoption of low emission vehicle 
standards against a challenge brought by automakers from around 
the world and dealers in Massachusetts. Massachusetts has 
adopted lower "California" emissions standards for cars to reduce 
ground-level ozone level and to facilitate compliance with the 
federal Clean Air Act. Motor vehicle emissions account for more 
than one-third of the man-made pollutants that contribute to 
urban smog. In November, 1993, the Federal District Court denied 
the auto industry's motion for a preliminary injunction that 
sought to derail Massachusetts' implementation of the low 
emission vehicle program. In denying the request for preliminary 
relief, the court found that the auto industry had little chance 
of invalidating the disputed regulations. 

In Nelson v. Commonwealth , property owners alleged that 
application of Wetlands Protection Act restrictions on seawalls 
to their properties amounted to an unconstitutional taking. The 
Commonwealth successfully defended this challenge before the 
Massachusetts Appeals Court, which affirmed the lower court's 
decision dismissing the taking claim and upholding the wetlands 
regulations . 



129 



In Joel A. Qribens v. Department of Environmental Protection , 
the Massachusetts Appeals Court ruled in favor of the Department 
of Environmental Protection, holding that failure to issue a 
decision in a wetlands case within seventy days (did not render 
the agency's subsequent decision invalid. The court held that the 
seventy day provision of the Wetlands Protection Act is directory 
rather than mandatory. 

VI. AMICUS PARTICIPATION 

EPD participates as amicus curaie in matters that affect 
legal rights of the Commonwealth. For example, EPD filed an 
amicus brief in the Supreme Judicial Court in Pazolt v. Philip 
G Coates, Director of the Division of Marine Fisheries, et al . , 
arguing that the aquaculture in the intertidal zone was protected 
under the right of fishing reserved to the public under the 
public trust doctrine. 

In addition, EPD filed an amicus brief in the Supreme Judicial 
Court in Point of Pines Beach Association, Inc. 
v. Energy Facilities Siting, requesting that the Siting Board's 
approval of a new 170-megawatt gas-fired power plant in Lynn, 
Massachusetts be overturned. 



DIVISION OF PUBLIC CHARITIES 

The Attorney General represents the public interest in the 
proper solicitation and use of all charitable funds. The 
Attorney General is authorized to "enforce the due application of 
funds given or appropriated to public charities within the 
commonwealth and prevent breaches of trust in the administra- 
tion thereof." G.L. c.l2, sec. 8. The Division of Public 
Charities is established by G.L. c.l2, sec. 8B to carry out the 
Attorney General's responsibilities in this area. 

To protect the public interest in this area, more than 32,000 
charities are registered with the Division, as well as 211 
fundraisers operating in Massachusetts. A charitable 
organization is one which is non-profit, whose purpose is 
charitable and which benefits a portion of the public; in 
addition to philanthropic organizations, examples of public 
charities include nonprofit hospitals, schools, social service 
providers, and cultural organizations. As well as registering 
and obtaining financial reporting by charitable organizations and 
fundraisers, the Attorney General is the defendant in all 
proceedings brought in the Supreme Judicial Court to wind up the 
affairs of a charitable organization. 

In addition to enforcement of laws requiring annual reporting 
by public charities operating in the Commonwealth, the Division 
focused its activities during the last fiscal year in three 
primary areas: enforcement litigation to address deception and 
fraud in charitable fundraising; estate and trust actions to 
ensure charitable trust funds are appropriately administered and 
applied; and corporate governance and oversight initiatives to 
ensure charitable governing boards are carrying out their 
fiduciary duties of due care and loyalty. 

In partnership with the Attorney General's Advisory Committee 
on Public Charities, the Division has also undertaken a 
continuing public education campaign regarding charitable giving 
and charity stewardship. 

SOLICITATION OF CHARITABLE FUNDS 

The Attorney General takes affirmative legal action against 
charities and professional fundraisers for unfair or deceptive 
solicitation practices and to enforce their fiduciary duties with 
respect to funds raised. In addition to injunctive relief, he 
may seek restitution of funds intended by the public to benefit a 
specific charity or particular charitable purpose, penalties, and 
fees . 

Following are examples of charitable solicitation cases in 
which the Division was involved in the last fiscal year: 



131 



Commonwealth v. International Missing Children's Foundation 

In October, the Division obtained a consent judgment 
permanently prohibiting fundraising in the Commonwealth against 
International Missing Children's Foundation (IMCF), a California- 
based charity. IMCF was also required to make a $1,000 payment 
to the Attorney General's Local Consumer Aid Fund. The 
Division's complaint alleged that David Giovannucci d/b/a 
Professional Consultants, a professional fundraiser working on 
IMCF ' s behalf, had used scripts instructing his employees to deny 
that they worked for a professional fundraiser and to state 
incorrectly that the fundraising campaign was affiliated with the 
Andover Police. 

The Division previously obtained a consent judgment against 
Giovannucci, whose business is located in Smithfield, Rhode 
Island, prohibiting him from engaging in deceptive fundraising 
practices and requiring him to pay $13,000 in fines. 

Commonwealth v. National Awareness Foundation and ' Leary 
Enterprises, Inc. 

In October, the Division obtained a consent judgment against 
' Leary Enterprises, Inc., a Massachusetts corporation owned by 
professional solicitor Sean 0' Leary. The corporation agreed to a 
permanent ban on charitable solicitation in Massachusetts. 

The Attorney General had brought suit in January 1993 against 
National Awareness Foundation (NAF) , a Washington, D.C. -based 
charity, and its solicitors, including O' Leary, alleging that 
they used deceptive solicitation practices to raise money from 
Massachusetts citizens by falsely telling donors their 
contributions would pay for distribution of "Hugs Not Drugs" 
workbooks in their local elementary schools, failing to disclose 
that they were paid solicitors, using the names of local school 
systems without authorization, and failing to distribute 
workbooks. A consent judgment obtained against NAF imposed a one 
year ban on charitable solicitation in Massachusetts beginning 
January 1993, a permanent injunction against unfair and deceptive 
solicitation practices, payment of $2,000 in costs and fees, and 
restitution. 

In July 1993, restitution payments of $1,000 each were 
distributed to school departments in Chicopee, Framingham, 
Groton, Hadley, Holyoke, Lowell, Natick, Northborough, 
Shrewsbury, Southwick, Springfield, Westfield and Worcester. 

Commonwealth v. Chosen Children Foundation and Joel Weinstein 
In November, after a trial, a consent judgment was entered 
against Chosen Children Foundation of Stoughton; its founder and 
president, Joel Weinstein, of Stoughton; and its Massachusetts 
state director, Eric Weinstein (Joel Weinstein's son), of 
Randolph. The lawsuit alleged that the Weinsteins deceived the 
public by holding out Chosen Children as a charity benefiting 
handicapped children, when in fact they were using the donated 



132 



money to enrich themselves. In November 1992, a temporary- 
receiver had been appointed to operate the entity. 

The consent judgment removes the Weinsteins as officers and 
directors of Chosen Children and all its affiliates and requires 
them to cause such affiliates to return funds transferred from 
Chosen Children. It also permanently bans Joel Weinstein from 
all fundraising or other charitable activity in Massachusetts or 
with Eric Weinstein and from all such activity outside 
Massachusetts for five years. Joel Weinstein must pay $30,000 in 
restitution to the receiver, which penalty is not dischargeable 
in bankruptcy. Eric Weinstein is banned from all fundraising or 
other charitable activity in Massachusetts for five years. 
Finally, the receiver is directed to wind up Chosen Children's 
activities and have it dissolved. 

Commonwealth v. Kevin Kestyn d/b/a Laser Care Marketing 

In December, the Division obtained an Assurance of Compliance 
from this business, ending its use of the names of local 
charities to promote the sale of Christmas trees without the 
charities' permission. Kestyn allegedly advertised that a 
portion of the purchase price of each Christmas tree he sold 
would benefit a veterans' homeless shelter. The Division alleged 
that when his negotiations with the New England Shelter for 
Homeless Veterans fell through, Kestyn informed consumers calling 
to order a tree that proceeds would benefit Rosie's Place. 
Although Kestyn was in contact with both these charities, he had 
not registered with the Division as a commercial co-venturer 
before utilizing a charitable appeal in advertising his product, 
and failed to obtain written authorization before using the 
charities' names. 

Commonwealth v. Allan C. Hill Productions 

In January, the Division obtained a consent judgment against 
Allan C. Hill Productions, a Sarasota, Florida, company which 
sells tickets to circuses and plays which it produces for 
civic and charitable entities throughout the East Coast. The 
court order prohibits Hill from engaging in deceptive 
solicitation practices and requires it to pay $10,000 to the 
Attorney General's Local Consumer Aid Fund. 

The complaint alleged that telemarketers working for Hill used 
the names of certain charitable organizations without 
authorization, failed to disclose they were professional 
fundraisers, and falsely led prospective purchasers of tickets to 
a play produced at Canton High School for the benefit of the 
Canton Recreation Department in December 1993 to believe that 
every ticket bought would be donated to disadvantaged children 
and the elderly. In fact, fewer that 250 of the over 7,000 
tickets sold were used by such persons; the Canton Recreation 
Department received $10,000 of the $50,000 raised. 

The consent judgment further requires Hill to refund twice the 
ticket price to any ticket holder denied admission to any event 



133 



it produces due to overbooking and prohibits Hill from saying 
that tickets will be donated to the disadvantaged or the elderly, 
unless he has written commitments from organizations providing 
such guests prior to the solicitation. 

Commonwealth v. R.H. McKnight, Inc. 

In January, the Attorney General obtained a consent judgment 
against this statewide police fund-raising company based in 
Falmouth. Without admitting liability, McKnight, Inc. agreed to 
a consent judgment requiring increased monitoring and oversight 
of persons it hires to conduct police fundraising, to ensure that 
the fundraising does not mislead the public. 

The Attorney General's complaint alleged that a McKnight, Inc. 
fundraising campaign on behalf of a statewide union of police 
officers misled potential donors to believe that the donated 
funds would benefit local police departments. McKnight, Inc. 
agreed to pay $5,000 to the Local Consiimer Aid Fund and $2,500 to 
the Barnstable County Deputy Sheriffs Association Youth Ranch. 

Commonwealth v. Association of Retired Police Chiefs and 
Samuel Farrell 

In March, the Division obtained a consent judgment settling a 
case previously filed against a Holbrook-based organization and 
its founder. The court order requires dissolution of the entity 
and permanently bans Samuel Farrell, of Brockton, from 
fundraising or handling charitable funds in Massachusetts. 
Farrell must also pay restitution of $10,000 to the Local 
Consumer Aid Fund. 

The complaint alleged that ARPC fundraisers falsely identified 
themselves as members of the Westfield, Palmer, and Holyoke 
police departments to residents in those communities; that the 
name was misleading since no police chiefs, active or retired, 
were members of the group nor was it affiliated with any police 
group; and that the names of deceased police chiefs and others 
with no affiliation with the organization were used to mislead 
donors . 

Commonwealth v. Project Care, Thelma Moss and Arthur Turner 

In May, the Attorney General obtained a preliminary injunction 
in a suit filed in April against a Springfield-based charity and 
two of its board members alleged to have deceptively raised money 
on the streets of Northampton for the homeless. The defendants 
agreed to stop all fundraising in the state until the suit has 
been resolved, to account for all funds solicited from the public 
since Project Care's inception, and to file all past due 
financial reports with the Division of Public Charities. 

The complaint alleged that representatives of Project Care 
approached members of the public in person and induced them to 
make cash donations by using the names of local organizations 
serving the homeless and falsely implying that such organizations 
would benefit from the funds raised. Affidavits from eight 



134 



organizations serving the homeless in the Springfield and 
Northampton areas were filed with the complaint, stating that the 
organizations had not authorized use of their names nor endorsed 
Project Care's solicitation and had not received any funding from 
it. The complaint further alleged that Project Care failed to 
file required annual financial reports with the Division for the 
fiscal years 1989 through 1992 and sought restitution and 
penalties in addition to an accounting and injunction. 

American Veterans Assistance Corporation, a/k/a Veterans 
Wish Foundation, and RD Marketing 

In May, the Attorney General filed suit against this 
California-based veterans group and its Woburn fundraiser. AVAC 
also goes by the name Veteran's Wish Foundation. The complaint 
alleged that RD Marketing engaged in deceptive telemarketing 
practices on behalf of AVAC by leading potential donors to 
believe that the California veterans group was located in Lowell 
or Framingham and that the money raised would go to help local 
veterans. The fundraiser also failed to make mandatory 
disclosures, including disclosure of its status as a professional 
fundraiser. 

After the filing of the Attorney General's suit, both the 
fundraiser and the charity agreed to preliminary injunctions 
enjoining them from using these and any other deceptive 
practices . 

Commonwealth v. David Giovannucci d/b/a Professional 
Consultants and P.C. Marketing 

In June, the Attorney General filed a complaint for contempt 
against a Rhode Island-based fundraiser who, while soliciting on 
behalf of an Oxford police association, allegedly violated a 1993 
court order barring him from deceptive fundraising practices. 
The complaint alleges that Giovannucci ' s telemarketers violated 
the 1993 order by giving potential donors the false impression 
that all funds donated would go to charity and that the callers 
were police officers. The complaint also alleges that the 
telemarketers failed to disclose that they were professional 
fundraisers. The Attorney General seeks a three-month ban and 
$10,000 for each violation of the court order, in addition to 
restitution and attorneys' fees. 

ESTATES AND TRUSTS 

In furtherance of his authority to "enforce the due 
application" of charitable trust funds and to "prevent breaches 
of trust in the administration thereof, " the Attorney General is 
an interested party in the probate of all estates in which there 
is a charitable interest and in all other judicial proceedings 
affecting charitable trusts. Accordingly, the Division continued 
to handle a large volume of cases in this area involving such 
matters as proposed allowance of accounts, will compromises, sale 
of real estate, change of purposes or beneficiaries of charitable 
trusts and bequests, amendment of charitable trusts to meet IRS 



135 



requirements, and termination of charitable trusts under G.L. 
C.203, §25. For example: 

Trustees of Trust under Will of Carolyn Weld Fuller and 
Fuller Trust, Inc . 

In July 1993, the Division submitted its brief to the Supreme 
Judicial Court on seven questions reserved and reported by the 
trial judge. Oral argument was heard in January 1994, and the 
Court rendered its opinion in July 1994. The case arose out of a 
$500,000 settlement obtained by the Division from former trustees 
of the Fuller Trust. The trial judge's Reservation and Report 
raised issues regarding the Probate Court's jurisdiction to 
examine the former trustees' management and administration of the 
assets of the trust through charitable corporations, to impose 
additional liability beyond the amount obtained by the Attorney 
General, and to appoint successor trustees. 

The Court ruled, as the Attorney General had argued, that the 
Probate Court should fill the trustee vacancies, and that the 
court has the power to require a full accounting from the former 
trustees and to consider further financial recovery from them. 
The Court also ruled, as urged by the Division, that: 

[T]he court should consider further financial recovery from the 
trustees only if, after consideration of potential defenses and 
of the potential costs to the charity and risks to the viability 
of the intended charitable purpose, the judge concludes that 
further litigation, should it be necessary, will be likely to 
produce a recovery sufficiently above the $500,000 obtained by 
the Attorney General to render such further litigation 
appropriate to the furtherance of the charitable purpose. 

Commonwealth v. Franklin Foundation 

In December, the Supreme Judicial Court ruled, as argued by 
the Attorney General, that a $5,000,000 trust was distributable 
two hundred years after Benjamin Franklin's death pursuant to his 
will and codicil, is to be distributed now to the Commonwealth 
and the City of Boston, in accordance with the terms of 
Franklin's will. The dispute arose when Franklin Institute, a 
technical college in Boston created at the turn of the century 
with money distributed at that time pursuant to the first part of 
Franklin's bequest, claimed that it was entitled to the balance 
of the fund under a 1958 legislative enactment which sought to 
terminate the trust and distribute the fund to the Institute. The 
Supreme Judicial Court had found this statute ineffective in a 
1960 case. The Institute contended that since the statute had 
never been repealed, it should now be given effect to require 
distribution to the Institute. 

In a brief filed in July and in oral argument in November, the 
Attorney General, acting to ensure the due application of 
charitable funds, and on behalf of the Commonwealth and the City 
of Boston as named beneficiaries of the Franklin codicil, 
maintained that the 1958 enactment had no present applicability. 



136 



The Supreme Judicial Court agreed with the Attorney General's 
position . 

Wigglesworth, et al. Trustees under Will of Roxana 
C. Cowles V. Cowles, et al 

In May, the Division argued to the Appeals Court that the 
attempts of the heirs of Roxana Cowles to terminate the 
charitable trust under her will should be rejected, because the 
right of reverter in favor of the heirs had not been triggered. 
Instead, the trustees had properly carried out the dominant 
intent of the testatrix in building and operating the Stephen 
Caldwell Memorial Convalescent Home in Ipswich. 

The Attorney General further argued that the Probate Court had 
correctly exercised its authority to ratify, under the doctrines 
of deviation or cy pres , past actions of the trustees in razing 
and replacing the dwelling house of the testatrix, forming a 
corporation to carry out the trust purposes, and changing 
corporate articles of organization in order to qualify for tax- 
exempt status. As a charitable trust, the Cowles Trust is to be 
liberally construed and upheld if at all possible. The Attorney 
General also argued that the claims of the heirs were barred by 
collateral estoppel, laches, and the provisions of G.L. c.260, 
section 31A. The Appeals Court has not yet handed down its 
decision. 

Attorney General v. Schlichte, et al. Trustees under Will of 
James N. Abbott, Jr. 

In December, the Division filed suit against the trustees of a 
North Shore charitable trust, seeking a declaration by the Court 
that the trustees had violated their trust by improperly 
excluding students from the Town of Essex and others from 
eligibility for scholarships from the trust, and further seeking 
removal of the trustees. The trust, created to help underwrite 
higher education for students domiciled and resident in 
Gloucester, Rockport, and Essex, requires that applicants 
demonstrate their willingness and intention to return to Cape Ann 
after their schooling to contribute their talents and training to 
the area. The trustees, however, maintained that only graduates 
of Gloucester and Rockport High Schools ere eligible, a 
requirement not found in the trust. The Division took enforcement 
action when the trustees refused to alter their position. 

In April, the Essex County Probate Court granted the Attorney 
General's request for a preliminary injunction requiring the 
trustees to provide notice of the availability of scholarships to 
all potentially eligible applicants, pending resolution of the 
case. The trustees gave notice by publication, as required by 
the Court's order, and applications filed pursuant to the notice 
are currently being held in escrow. 



137 



Bradford, Rector of the Parish of All Saints, et als. v. 
Attorney General 

In October, governing officials of this church filed suit 
against the Attorney General, seeking a declaration as to the 
interpretation of a particular donated fund held by the church, 
and as to the authority of the Attorney General to investigate 
expenditures from the fund. The Attorney General filed a 
counterclaim, alleging that church officials had made 
expenditures from the fund for purposes other than those 
specified in the will which established the fund, and that the 
court should order an accounting and restitution, and should 
appoint new trustees of the fund. The case is pending. 

Trustees of Russell Trust and Trustees of Stearns Trust v. 
Attorney General 

The Division identified some problem areas in the 
administration of the Stearns and Russell trusts created for the 
poor of Lawrence, which required modification of trust 
instruments and trustee procedures. The Attorney General and the 
trustees jointly sought to remedy these problems via documents 
presented to the probate court securing approval for increasing 
the number of trustees from three to five, with the two newly 
appointed trustees being individuals who are conversant with the 
Latino community; the creation of a new grant application 
procedure which is designed to make applicants and trustees aware 
of the most appropriate beneficiaries of the two different 
trusts; and a review process whereby the Division reviewed the 
1993 and 1994 grants. By agreement, changes were made to the 
1993 grants so that the grants reflected the new approach to 
grant-making, and were appropriate under each trust. 

Maiden Public Library v. Attorney General 

The Division reviewed and assented to the petition for 
reasonable deviation in this case in which art subject to trust 
restrictions was to be auctioned and proceeds used to refurbish 
library and complete capital campaign for new, handicapped 
accessible library. 

Estate of Walter Wilson 

The Division reviewed and assented to the Amended First and 
Final Accounts of the Executor of this estate probated in New 
York which made a gift to the Commonwealth of over 400 acres of 
land in western Massachusetts. 

Spring, et al. Trustees of the Trust under Will of Hervey 
A. Hanscom v. Nasson College, et al . 

In March, the Middlesex Probate Court ruled that the specific 
gift to Nasson College under the Hanscom Trust failed because it 
was impossible for Nasson College to carry out the intent of the 
gift. Nasson College, pro se , filed a notice of appeal, which 
the plaintiff trustees moved to dismiss in June for failure to 
perfect the appeal. The Court will now consider the issue of 
general charitable intent and applicability of the doctrine of 



cy pres . The Division will continue to take an active role in 
the case. 

Seamen's Widow and Orphan Association, Inc. v. Attorney General 

The Division reviewed, negotiated and assented to SWOA's cy 
pres petition to broaden the class of eligible beneficiaries of 
this organization founded in 1833 to assist widows and orphans of 
Salem area seamen, when seamen and their families constituted 
nearly the whole community, to assist any Salem area persons in 
need (while still giving priority to original beneficiaries when 
possible) , thereby facilitating full utilization of the 
organization's charitable assets. 

CHARITABLE CORPORATIONS 

The assets of all charitable corporations and other public 
charities are considered by law to be held by the charitable 
organization for charitable purposes. Under common law and G.L. 
C.12, §8, the Attorney General represents the public's interest 
in the proper use of these assets. 

Trustees of Boston University 

In December, the Attorney General obtained an agreement with 
Boston University to make a number of fundamental changes in the 
University's corporate governance practices. In the agreement, 
the University agreed to implement a series of reforms in the 
areas of: 

* trustee selection, 

* executive compensation, 

* conflicts of interest and related party transactions, 

* oversight and monitoring by the Board of Trustees, 

* public filings with the Attorney General's Public 
Charities Division. 

The agreement, which will be in effect until January 1, 1999, is 
a public document. 

The investigation and review by the Public Charities Division 
focused on the overall responsibilities of the trustees to 
oversee and to monitor the activities of the University. Under 
the agreement, new trustees are to be nominated by a committee at 
least one- third of whose members are selected by the University's 
Alumni Association and may not be University trustees or 
employees. The agreement applies a term limit of eight years to 
the office of Chairman of the Board of Trustees. If, at any one 
time, 40 percent or more of the trustees have served more than 12 
years on the Board, a term limit will apply until the number of 
trustees serving more than 12 years has been reduced to below 40 
percent . 

The agreement puts particular emphasis on the issue of trustee 
oversight of executive compensation and of University 
transactions with anyone related to a trustee, committee member 



139 



or executive officer. The agreement requires the University to 
provide full information to trustees regarding the activities of 
Board committees and subcommittees, and requires approval by the 
Board of Trustees, not merely by a board committee, of the 
compensation of the University's President and other top 
officials and of any related party transactions. Under the 
agreement, related party transactions are prohibited except where 
the trustee discloses his or her interest to the Board, and the 
Board, without the trustee's participation, approves the 
transaction at a meeting of the full Board and determines that it 
is in the best interests of the University. 

In connection with the agreement, the University also filed 
amended annual financial reports with the Attorney General's 
Division of Public Charities. The amended reports list several 
corrections in the reporting of executive compensation and 
related party transactions for the University's fiscal years 1987 
through 1992. The University agreed to provide timely and 
complete compliance with reporting requirements in the future. 

Commonwealth v. Peaceful Movement Committee, Inc. 

In December, the Division, together with the Department of 
Public Health, obtained a court order placing Peaceful Movement 
Committee, Inc. (PMC), a Dorchester state-funded addiction- 
treatment services clinic, in temporary receivership to ensure 
that its programs were properly conducted. This action followed 
a joint investigation by the Division and DPH ' s Bureau of 
Substance Abuse Services. PMC services include methadone 
treatment, drug counseling youth intervention programs, driver 
alcohol education and domestic violence prevention. 

The order temporarily suspends PMC's management until a 
lawsuit filed by PMC's board is resolved and directs the 
temporary receiver to continue programs, evaluate management, 
staffing and accounting practices, and make recommendations as to 
whether PMC should become affiliated with another charity in 
order to best maintain programs now conducted by PMC. 

Commonwealth v. Students Against Driving Drunk, Inc. 

The Board of Directors of S.A.D.D., a national organization of 
6,000,000 members headquartered in Marlborough, agreed to make 
extensive reforms to its corporate governance practices, 
including agreeing to rescind the remaining $1,000,000 of a 
$1,400,000 consulting contract and retirement benefits previously 
awarded to the charity's former executive director and founder, 
Robert Anastas. The "golden parachute" threatened to undermine 
the charity's financial stability. 

The Letter of Agreement, which eliminated the present need for 
a lawsuit by the Division against the Board of Directors and is a 
public document, also provides that any future contract between 
S.A.D.D. and Anastas will be subject to review by the Division 
and that the Board will be increased from 10 to 15 members, with 
3 seats reserved for regional coordinators . The Board also 



pledged to carry out their duty to provide enhanced oversight of 
the fiscal management of S.A.D.D. 

Russell Doll and Toy Museum v. Attorney General 

The Division investigated, pursuant to a petition to dissolve, 
into whether the founder of the museum improperly auctioned 
museum property for his private benefit. After resolution of the 
issues, the petition to dissolve was allowed by the Supreme 
Judicial Court. 

Hospital Transactions 

The Division reviewed several major transactions involving 
nonprofit health care providers to ensure that charities law 
considerations were addressed appropriately. These included: 

Massachusetts General Hospital & Brigham and Women's Hospital : 
the Division reviewed the proposed affiliation between these two 
hospital systems. The Division concluded that court approval was 
not required under charities law. 

Hahnemann Hospital (Brighton) : the Division reviewed proposed 
sale of assets, and negotiated and assented to court petition. 
Court approval was granted. 

Glover Memorial Hospital (Needham) : the Division reviewed 
proposed sale of assets to another nonprofit hospital, and 
negotiated and assented to court petition. Court approval was 
granted. 

Beverly Hospital and Cape Ann Health Systems : the Division 
reviewed proposed affiliation between these two hospital systems. 
The Division concluded that court approval was not required. 

Symmes Hospital and Lahey Clinic : the Division reviewed sale of 
assets by nonprofit hospital to joint venture of another 
nonprofit hospital and a for-profit business. We negotiated 
issues affecting the structure of the transaction and the form of 
a court petition, to which we assented. Court approval was 
granted. 

Participation in Attorney General's Health Care Task Force 

Members of the Division were actively involved in the Attorney 
General's Health Care Task Force. The Division co-chaired the 
development of the Attorney General's Community Benefits 
Guidelines for Nonprofit Acute Care Hospitals, and participated 
in other activities of the Task Force. 

Dissolutions 

In order to cease corporate existence, charitable corporations 
must dissolve through a proceeding in the Supreme Judicial Court. 
To enforce the public's interest in the disposition of charitable 
assets, the Attorney General is a party to all voluntary 
dissolutions of charitable corporations under G.L. c.l80, §11A. 
After review, negotiation of necessary modifications, and assent 



by the Division, the pleadings are filed by the dissolving 
charity in the Supreme Judicial Court. 

During the reporting year, the Division assented to 109 final 
judgments dissolving charitable corporations pursuant to section 
llA. Also, the Division filed an Omnibus Petition with the 
Supreme Judicial Court to dissolve a group of 40 inactive 
charitable corporations under G.L. c.180, §11B. 

Review of Asset Dispositions 

Under amendments to the non-profit corporations act, which 
took effect in April 1990, a charitable corporation must give 30 
days advance written notice to the Attorney General before making 
a sale or other disposition of all or substantially all of the 
charity's assets if the disposition involves or will result in a 
material change in the nature of the activities conducted by the 
corporation. G.L. c.l80, §8A(c). During the year, the Division 
reviewed 16 such dispositions. 

PUBLIC EDUCATION INITIATIVES 

In partnership with the Attorney General's Advisory Committee 
on Public Charities, the Division undertook a continuing public 
education campaign regarding charitable giving and charity 
stewardship. 

Giving Season Public Education Campaign 

In November, the third annual "ATTORNEY GENERAL'S REPORT ON 
CHARITABLE FUNDRAISING" was published as part of the Attorney 
General's annual "GIVING SEASON" public education campaign. 
Timed to coincide with charitable appeals during the holiday 
season, and in cooperation with the "Give But Give Wisely" 
education program conducted by the Better Business Bureau and 
other charitable organizations, this campaign is a long-term 
effort to inform individuals and businesses about the donating 
process and how to make sure that their contributions are put to 
the best possible use. 

The 34-page report explains how charitable fundraising works, 
including the role that commercial solicitors play, and analyzes 
the financial reports of 158 fundraising campaigns by solicitors. 
The report concludes that for the campaigns analyzed charities 
received an average of 28.9% from the total amount raised on 
their behalf by professional solicitors. The report also points 
out that charities use fundraising not only to raise money, but 
as a means to gain name recognition, educate the public about 
their causes and the services they provide, and to increase their 
membership and volunteer base. While under U.S. Supreme Court 
rulings the state cannot set limits on the amount of 
contributions retained by commercial fundraisers, Massachusetts 
does have laws prohibiting deceptive fundraising, which are 
enforced by the Division. 



other related publications available from the Division 
include: "Donating Do's and Don'ts", "How To Give But Give 
Wisely", and "Attorney General's Guide for Charities Who Fund- 
raise from the Public" . 

Statewide Conference: "Nonprofit Boards: Dilemmas in 
Doing the Right Thing" 

On April 7, 1994, the Attorney General sponsored the second 
annual statewide educational conference for members of charity 
boards. Entitled "Nonprofit Boards: Dilemmas in Doing the Right 
Thing", the conference was attended by over 600 participants from 
more than 120 cities and towns representing a wide range of 
organizations from the smallest volunteer charities to the 
largest hospitals and universities in the state. 

After a keynote address by the Attorney General on the role of 
the Attorney General in regulation and enforcement in the 
nonprofit sector and educational initiatives of the Attorney 
General to respond to problems faced by nonprofit board members, 
two panels of speakers discussed "Building and Sustaining an 
Effective Board", including the topics Board Membership and 
Structure, Duty to Govern, and Conflict of Interests, and "More 
Tough Dilemmas", including the topics Balance of Power Between 
Board and Staff, Compensation and Evaluation, Staff Hiring, 
Sustaining and Firing. 

Guide for Board Members of Charitable Organizations 

The Division distributed widely "The Attorney General's Guide 
for Board Members of Charitable Organizations", containing 
recommendations in key areas of charity stewardship. Developed 
with assistance from the Attorney General's Advisory Committee on 
Public Charities and initially issued in June 1993, the Guide is 
intended to help board members of charitable organizations in the 
exercise of their fiduciary duties. In 1994 the Division 
supplemented the Guide with an extensive Board Member's Packet of 
information . 

Conference and Professional Education Presentations and 
Publications 

As part of the Division's ongoing public education effort, the 
Director of the Division and other Assistant Attorneys General in 
the Division spoke to numerous charitable groups and served on 
several continuing professional education panels throughout the 
year, including the Human Service Forum (Springfield), Assoc, of 
Independent Schools, Assoc, of Mass. Homes for the Aging, New 
Eng. Museum Assoc, Mass. Human Service Providers Conference, 
Mass. Continuing Legal Educ . , Mass. Bar Assoc, Boston Bar 
Assoc, Mass. Society of CPAs . 



143 



DIVISION ADMINISTRATION AND STATISTICS 

Enforcement of laws requiring accountability by public 
charities is central to Division responsibilities with respect to 
charitable funds. With the exception of religious organizations 
and certain federally chartered organizations, all public 
charities must register with the Division and all registered 
charities must submit annual financial reports. The 
registrations and financial reports are public records and public 
viewing files are maintained. The Division responded to over 
4,947 requests to view files in the past fiscal year and, in 
response, approximately 11,012 files were pulled. 

Charitable Organizations: Registration and Enforcement 

From July 1, 1993 through June 30, 1994, the Division 
processed approximately 12,373 annual financial reports and 
annual filing fees totaled $1,082,575.00. During this period, 
1,078 new organizations were reviewed, determined to be 
charitable, and registered. Each was sent the Division's packet 
of information about the Division's registration and filing 
requirements . 

As part of an ongoing compliance program, the Division 
contacted approximately 9,059 charities whose annual filings were 
deficient or delinquent to rectify filing deficiencies. 

Issuance of Certificates to Charities Who Fundraise 

Under G.L. c. ,68, sec. 19, every charitable organization which 
intends to solicit funds from the public, except religious 
organizations, must apply to the Division for a solicitation 
certificate before engaging in fundraising. Upon receipt, the 
Division reviews certificate applications for compliance with 
statutory requirements. Unless there is a deficiency in the 
application, all certificates are issued within a 10-day 
statutory period. 

This year, 10,623 certificates were received and processed. 

Registration of Professional Solicitors and Fundraising Counsel 

Under §§22 and 24 of G.L. c.68, all persons acting as 
professional solicitors, professional fundraising counsel, or 
commercial co-venturers in conjunction with soliciting charitable 
organizations must register annually with the Division. 
Solicitors and commercial co-venturers must also file a surety 
bond in the amount of $10,000.00. All fundraisers must also file 
with the Division a copy of each fundraising contract which they 
sign with any charitable organization, and solicitors must later 
file a financial return regarding each fundraising campaign. 

During the fiscal year ending June 30, 1994, a total of 211 
registrations were received and approved, resulting in $45,300.00 



144 



in fees to the Coininonwealth. Registrations for calendar 1994 
were received from 75 solicitors, 100 fund-raising counsel, and 
14 commercial co-venturers (such registrations are required to be 
filed on a calendar year basis pursuant to G.L.c. 68, section 
24) . 

Wills, Trusts, and Other Probate Matters 

During the past fiscal year, the Division received 1,045 
probate citations; received and reviewed 1,371 new wills, 1,093 
of which contained charitable bequests; and received and reviewed 
867 interim accounts for executors and trustees, as well as 778 
final accounts. In addition, the Division received 237 other 
petitions and citations and 581 miscellaneous probate matters in 
new or existing probate cases, including 81 petitions for license 
to sell real estate and over 20 petitions under G.L. c.203, sec. 
25 to terminate trusts too small to be administered economically 
and distribute the trust property to the beneficiary, resulting 
in the availability of more income to the charitable 
beneficiaries of such trusts by reason of elimination of 
administrative costs. After review and negotiation, a total of 
640 assents were issued in all categories of probate matters. 

Public Administration 

The Division represents the State Treasurer in the public 
administration of intestate estates which escheat to the 
Commonwealth because the decedent had no heirs. During the year, 
the Division reorganized and updated procedures and the over 200 
case files currently open. This was done in cooperation with the 
Treasury Department of the Commonwealth and the 48 Public 
Administrators currently serving in the several counties of the 
Commonwealth. Pursuant to these procedures. Public 
Administrators are to send escheated funds directly to the 
Treasury Department, Unclaimed Property Division. In addition, 
the Division opened files on 95 new intestate estates, 168 
estates were closed, and 8 other miscellaneous public 
administration matters were handled. 

Form PC Revision 

With the assistance of a working group from the Attorney 
General's Public Charities Advisory Committee, the Division 
revised the reporting form utilized annually by public charities 
- the Form PC. In addition to clarifications to make the form 
and the reported information more easily used by charities and 
the public, for the first time the Form PC asks charities to 
report all assets held not only by the filing charity but also by 
any related organization. 



145 



TABLE I : Money Recovered 
For The Commonwealth Treasury 

A. Charitable Registrations, Certificate Fees, 

and Fundraiser Registrations $1,127,875.00 

B. Other fees, requests for copies, requests for computer 
information $ 27,840.00 



146 



REGULATED INDUSTRIES DIVISION 

The Regulated Industries Division represents consumer 
interests in regard to two specific industries: insurance and 
public utilities. Although some of the Division's work is carried 
on in state and federal courts, most is performed before 
administrative regulatory bodies: the Massachusetts Department of 
Public Utilities, the Federal Energy Regulatory Commission, the 
Federal Communications Commission, and the Massachusetts Division 
of Insurance. In many of matters, particularly public utility 
rate cases, the Division is the only active participant 
advocating on behalf of consumers. 

INSURANCE 

The division's representation of consumer interests in 
insurance matters is divided into several distinct categories. 
The division intervenes in both automobile and health insurance 
rate setting proceedings. The division also performs a consumer 
protection/insurance laws enforcement function: through the 
Office's consumer hotline and direct mail and telephone 
communications, the division receives many consumer questions and 
complaints. Through mediation, negotiation and, if necessary, 
litigation , the division obtains both restitution and injunctive 
relief for insurance consumers. Finally, the division engages in 
non-case related work to advance insurance consumer interests, 
including legislative, regulatory, educational, and other 
outreach 

RATE CASES 

1994 Private Passenger Automobile Insurance Rates: 

On August 12, 1993, the Automobile Insurance Bureau of 
Massachusetts ("AIR") filed with the Division of Insurance its 
recommendation concerning the 1994 private passenger automobile 
insurance rates. The industry requested a 5.9 percent increase 
over the 1993 rates. If approved, this request would have been 
equivalent to an average increase in auto insurance premiums for 
Massachusetts drivers of $52.00 per car or 171 million dollars 
overall. On behalf of Massachusetts consumers the Division 
challenged the requested increase and recommended an increase of 
1.7%. After several days of evidentiary hearings and responsive 
briefs, filed with the Division of Insurance, the commissioner 
issued a decision on December 15, 1993, approving a 2.9 percent 
increase over 1993 premiums. The Division's intervention 
resulted in savings to Massachusetts consumers of $89 million or 
$26.00 per car. 

1995 Private Passenger Automobile Insurance: 

Proceedings concerning 1995 automobile insurance rates began 
in April of 1994 with the annual hearing called by the 
Commissioner to determine whether it was necessary that the 
rates for 1995 be fixed and established in accordance with G.L. 
C. 175 113B. The Division participated in these hearings and 



recommended that market conditions to require that rates continue 
to be set in like fashion. 

1994 Blue Cross and Blue Shield of Massachusetts Non-Group 
Health Insurance Rates: 

In April of 1993, BCBS sought a 23.6 percent average increase 
in the premium rates for its non-group health insurance. 
Evidentiary hearings began in May, with the division sponsoring 
the testimony of two experts. Hearings continued through June 

1993 and a brief was filed with the Division in July. On July 
27, 1993, the commissioner issued her decision reducing the 
average rate increase to 18.55, to be effective September 1, 
1993. The Commissioner also refused to allow Blue Cross and Blue 
Shield to base the premiums paid by group conversion subscribers 
on their own experience, rather than on the experience of health 
statement subscribers. The combined effect of these rulings 
resulted in savings to Massachusetts non-group consumers of an 
estimated $20 million. 

1994 Blue Cross and Blue Shield of Massachusetts MEDEX Insurance 
Rates . 

In August, 1993, BCSS sought a proposed 10% increase in premium 
rates for Medicare supplement insurance, MEDEX, which is 
purchased by seniors to cover deductibles, co-payments and 
services not covered under the Medicare program. On behalf of 
MEDEX subscribers, Division participated in hearings before the 
Division of Insurance challenging the rate increase and cost 
projections in the BCBS filing. Subsequent to the Division's 
intervention, agreement was reached in which BCBS agreed to an 
average rate increase of 3% for 1994, and also agreed not to bill 
retroactively the 1993 rate increase which had not been charged 
to subscribers for the first quarter of 1993 . The total saving 
to MEDEX subscribers as a result of this agreement was 
approximately $30 million. 

FAIR'S Request for Rate Increase: 

In fiscal year 1994, the Division concluded its investigation 
into the availability of property and casualty insurance in urban 
and low income areas. The investigation showed that, as a 
general rule, the only affordable homeowner insurance available 
to inner city residents is written by the FAIR plan. The FAIR 
plan is a residual market, established in 1968 to ensure the 
availability of basic property insurance for those unable to 
secure coverage through the private sector. Its losses are pro- 
rated among property and casualty carriers in accordance with 
their Massachusetts market share. In response to FAIR'S request 
to the Division of Insurance to approve a rate increase, members 
of the Division advised the Division of Insurance that any rate 
increase would require a rate regulation process in which the 
Office of the Attorney, General would intervene on behalf of 
consumers. The intervention would, involve the strict scrutiny 
of FAIR'S rates in much the same way that other rate requests are 
reviewed. Discussions with the State Rating Bureau and with the 



148 



FAIR plan regarding the requested increase were ongoing at the 
end of the fiscal year. 

Consumer Protection/Enforcement : 

The division also engaged in non-rate case related insurance 
work during fiscal year 1994 that involved consumer protection 
issues and/or enforcement of the Commonwealth's insurance laws. 
Representative matters include: 

LEGAL ACTIONS 

Commonwealth vs. Retired Home Owners, Inc. e t al . : 

The Division enjoined the marketing and sale of an unlicensed 
home care insurance product by a California Corporation, and 
secured full restitution ($7,045 each) for all Massachusetts 
elder citizens who had purchased membership in RHO and its home- 
care product. Subsequently, the California Attorney Attorney's 
Office filed suit against RHO which thereafter filed for 
bankruptcy. Only Massachusetts consumers, however, received 
refunds of monies paid to RHO. 

Commonwealth vs. Associated Chiropractic Services, Inc. et al: 

The Division, in cooperation with the Consumer Protection and 
Antitrust Division, filed this suit in April of 1994 alleging 
that the defendants had violated the consumer protection statute 
through their unfair and deceptive collection campaign against 
hundreds of former patients. The defendants have been enjoined 
preliminary from further collection activities pending final 
resolution of the action. In addition, the Division filed a 
Complaint for Civil Contempt requesting the court to order the 
defendants to comply with the preliminary injunction, previously 
issued, by producing all documents and files relating to former 
patients . 

Commonwealth v. Poitras and the Massachusetts Lobstermen's 
Association : 

In April of 1990, this office filed a complaint in Suffolk 
Superior Court against the MLA and other defendants alleging that 
the defendants, without being duly licensed, marketed and sold an 
accident and health insurance plan to fishermen and others in 
Massachusetts; misrepresented that the plan was subject to ERISA, 
and refused to pay valid claims of approximately $3 million. On 
August 19, 1993 the Superior Court ruled that the MLA health 
insurance plan is not subject to ERISA; that the courts of 
Massachusetts are not preempted from considering the matter; and 
that the Attorney General is not preempted from seeking to apply 
state insurance law in this case. A memorandum of law on the 
issue primary jurisdiction was filed, at the request of the 
Court, in September, 1993. A Court ruling on this issue is still 
pending . 



149 



Commonwealth v. Maura Cronin, d.b.a. Claddagh Home Care: 

The Division obtained a preliminary injunction against Maura 
Cronin, d.b.a. Claddah Home Health Care ("Claddagh'), restraining 
her from engaging in unfair and deceptive acts and practices in 
the operation of Claddagh. Claddagh provides and arranges to 
provide home health care workers to predominately elderly 
consumers. The preliminary injunction was obtained pursuant to 
several complaints from consumers that they had paid Ms. Cronin 
for home health workers and had not received any services. In 
addition, several complaints were received from home health 
workers who had provides services to Claddagh clients and had not 
been paid by Claddagh. 

ASSURANCES OF DISCONTINUANCE 

The Division entered into Assurances of Discontinuance with 
four insurance agents during fiscal year 1994 which resulted in 
restitution to Massachusetts consumers of approximately 
$165,000,00. 

Johansson, Clark, and Gallo: 

Following an investigation by the Division, three insurance 
agents entered into Assurances of Discontinuance in which they 
agreed to refrain from soliciting and selling unauthorized 
insurance products, particularly those of Amalgamated American 
Employees Association, Amalgamated American Employees Association 
Benefit Fund, American Business League, United Healthcare Benefit 
Trust, and United Association of Small Business, and to refrain 
from representing such plans as ERISA plans. Pursuant to the 
Assurances, Theodore Johansson, Steven Clark, and Ernest Gallo, 
agreed, at their clients' option, either to refund the premiums 
paid or to pay medical claims which were unpaid as a result of 
their actions in selling an unauthorized health insurance plans. 
The agents also agreed to pay the Commonwealth the costs of the 
investigation . 

Joyal 

Donald Joyal, a licensed insurance agent, entered into an 
Assurance of Discontinuance with the Attorney General in which he 
agreed to refrain from soliciting prospective purchases of life 
insurance by misrepresenting, inter alia , whole life insurance as 
a "savings plan" or "investment plan". Joyal also agreed to 
refund the consumer with premiums collected. 

PUBLIC ADVISORY 

USA For Healthcare: 

The Division, following several consumer inquiries, conducted 
an investigation into the activities Of USA for Healthcare 
("USA"). The investigation revealed that USA was not licensed as 
an insurer or as an HMO in the Commonwealth, and was not a fully 
insured ERISA covered plan (Employee Retirement Income Security 
Act Of 1974) . Since Massachusetts insurance law imposes 
liability for payment of unpaid claims on insurance agents who 



sell unauthorized health insurance plans, the Division issued an 
advisory to approximately 13 insurance agents advising them that 
USA was neither a licensed insurance company nor a fully insured 
ERISA plan and also advising them of their potential liability. 
This advisory had the intended effect of halting the sale of 
unlicensed products in the commonwealth while the Division 
continues its investigation and negotiations with USA regarding 
outstanding unpaid claims of Massachusetts consumers. 

MISCELLANEOUS ACTIONS 

PrePaid Legal Services & American Association of Senior Citizens : 

Following up on an investigation and Assurance of 
Discontinuance obtained in a prior fiscal year against a senior 
citizen organization, American Association of Senior citizens 
(AASC) which sold unlicensed legal insurance Through PrePaid 
Legal Services. The Division participated in a multistate 
Attorneys General Task Force which was formed to coordinate 
action against Prepaid. Negotiations with PrePaid were 
concluded. They provide for reimbursement to consumers in 
Massachusetts and other states for the portion of AASC membership 
fee which was paid to Prepaid. Restitution to consumers is 
anticipated to be approximately $30,000.00 with an additional 
$5,000.00 to be paid to the Local Consumer Fund. 

FAILURE TO REMIT CASES 

Workers Health Fraud Task Force. 

As a result of a significant number of complaints received 
from current and former employees regarding the failure of their 
employers to maintain health insurance coverage, frequently 
instances in which the employer withheld funds or accepted COBRA 
payments, the Attorney General placed high priority on proceeding 
against employers who engaged in such behavior. Members of the 
Division, along with the Chief Prosecutor and Assistant Attorneys 
General in the Public Protection Bureau, aided by the civil 
Investigation Division, formed the Workers Health Fraud Task 
Force. The members of the Task Force have reviewed and 
investigated more that twenty employers. At the end of the 
fiscal year, the Task Force anticipated the imminent issue of 
several grand jury subpoenas, initiation of civil action against 
several other employers and agreements with yet other employers 
to give restitution to employees and former employers. 

Notification of Cancellation of Group Health Insurance. 

Much of the harm suffered by employees without health 
insurance coverage is exacerbated by the fact that they receive 
no notice of the cancellation of their coverage. Carriers 
provide notice of cancellation only to employers who, in many 
instances, do not notify employees. Employees, unaware that they 
have no coverage, continue to incur medical costs. The Division 
informed BC/BS of these notification concerns and discussed 
possible solutions to this problem with them. Partly because of 
these discussions, beginning April 1, 1994, BC/BS agreed to 



151 



provide notice to employees when their group coverage has been 
canceled. Members of the Division are currently engaged in 
discussions with other carriers suggesting that they also provide 
notice of cancellation to employees as well as to employers. 

Prosecutor's Rotation : 

A member of the Division spent four months of fiscal 1994 in 
Lawrence District court as a prosecutor with the Essex county 
District Attorney's Office as part of Attorney General Scott 
Harshbarger ' s Urban Violence Strike Force. The Division member 
assisted the District Attorney's Office by handling a full 
criminal case load including trials, motions to suppress, 
arraignments, and other duties. 

CONSUMER COMPLAINTS 

After investigation and intervention. Assistant Attorneys 
General in the. Division were instrumental in resolving several 
matters on behalf of consumers with an estimated value to 
consumers of approximately million. For example, 

Houston Casualty Co : an excess insurer, agreed to extend the time 
in which the insured could replace a building destroyed by fire 
and to process a claim previously determined by an order of 
reference; John Hancock : rescinded a policy allegedly issued 
without the knowledge of the consumer, canceled an allegedly 
unauthorized policy loan, and refunded the premiums paid plus 
interest; Prudential Life Insurance Company of America agreed to 
reinstate old policies and cancel new policies issued as a result 
of agent churning; John Hancock also paid the cash surrender 
value with interest to a consumer who had surrendered her life 
policy six months prior to our involvement; Cigna paid an 
outstanding bill incurred several years ago under a college 
student's policy thus relieving the former student from the cost 
of defending a collection action by the hospital; 
Central Massachusetts Health Care (CMHC) agreed to expedite the 
authorization for a bone marrow transplant for an AIDS patient; 
Pilgrim Health Care reversed a decision and agreed to provide 
infertility treatment in accordance with the law and its policy 
provisions. HMO Blue , after first denying access to treatment, 
changed its position and agree to permit a severely brain-damaged 
infant to obtain treatment out of panel from a particular 
physician and specialty hospital. In addition to the many 
consumer complaints which the Division was able to resolve on 
behalf of consumers, members of the Division explained and worked 
with many consumers to guide then in such matters as; 
understanding the intricacies of various entitlement programs and 
the interplay between them; the billing practices of their health 
insurers; continuation of health insurance coverage following 
termination of employment or following divorce and the like. 
While no monetary consumer benefit can be placed on these 
activities, they provide a valuable service to Massachusetts 
consumers, many of whom are elderly or who have no other sources 
to turn to . 



Consumer Hot-Line and Paralegal Resolution of Inquiries and 
Complaints : 

During the fiscal year, the division received and responded to 
moire than 600 telephone inquiries, an increase of 50% over the 
number of calls in the prior fiscal year; 325 written complaints, 
an increase of 100% over the number received in the prior fiscal 
year. An estimated $171,000 in refunds and benefits were 
received by consumers through the intervention of the paralegals 
and volunteer interns, an increase of approximately 50% over the 
prior fiscal year. 

OTHER ACTIVITIES 

Legislative Activities 

Private Passenger Automobile Insurance Reform : 

During the 1994 fiscal year, various legislative initiatives 
to reform the Massachusetts private passenger automobile 
insurance market were the subject of intense debate in the 
legislature. Foremost among the different reform proposals was 
Bill S1548, whose salient feature was the elimination of the 
current partial no-fault system in favor of a pure tort system. 
The Massachusetts Academy of Trial Attorneys suggested that the 
elimination of no-fault would result in reduced premium costs to 
the consumer whereas the automobile insurance industry suggested 
that the elimination would result in higher premiums, with 
possibly less insurance coverage. The Chair of the House 
Insurance Committee, Francis Mara, requested the Attorney General 
to comment on the proposed bill and to provide an objective 
analysis. The Attorney General engaged the firm of Milliman & 
Robertson to conduct an actuarial analysis. Members of the 
Division worked closely with Milliman & Robertson, providing 
information and analysis on the Massachusetts experience and the 
Massachusetts laws regarding automobile insurance. 

Non-Group Health Insurance Reform: 

The Division, as part of the Attorney General's Health Care 
Task Force, continued its efforts to effectuate health insurance 
reform. Members of the Division drafted legislation to reform 
the non-group insurance market. The legislation was sponsored by 
Representative Carmen Buell, the Chair of the General Court, 
Committee on Health Care, initially in 1992 and again in 1993. 
This legislation continues the efforts of the Non-Group Health 
insurance Reform Commission, convened by the Attorney General in 
1992, to address both the af f ordability and availability of non- 
group insurance. 



153 



General Health Care Reform : 

In addition to the draft legislation for non-group insurance 
reform, the Division, as part to the Attorney General's Health 
Insurance Legislative Working Group, focused on drafting 
legislation to improve the purchasing power of Massachusetts' 
consumers. The Legislative working Group was made up of 
representatives of the health care industry, including insurers, 
HMOs, hospitals, physicians, associations managing group plans 
and other interested parties. The Group met to consider non- 
group reform proposals and health alliance proposals. As a 
result of this process, the division assisted the General Court's 
Committee on Health Care in drafting its comprehensive health 
care reform legislation which remains before the Committee 
awaiting completion of federal health care reform efforts. The 
division will continue to lend its expertise to the, committee on 
Health Care through additional legislative drafting and editing 
as well as offering its interpretation of other legislative 
proposals . 

Medigap Reform: 

As a continuation of its participation in the reform of the 
Medigap health insurance, the Division was actively involved in 
reviewing and advising the legislature on the Medigap reform 
legislation which was enacted in the 1994 legislative session. 

Insurance Fraud Reform: 



As part of the Attorney General's interest in reducing fraud 
in the health insurance market, members of the Division prepared 
draft legislation to strengthen the provisions of current 
legislation regarding fraudulent health insurance claims. In 
addition, members of the Division prepared opposition statements 
to proposed legislation which would weaken considerably the 
current legislation. The efforts of the Division resulted in the 
Governor's veto of the proposed legislation. 

Regulatory Actions 

Medigap 

In April, 1994, the Division presented testimony at a public 
hearing convened to consider Division of Insurance's proposed 
regulations implementing M.G.L.C. 176k, the Medicare supplement 
reform statute passed by the legislature in December, 1993. In 
its comments, the Division urged the Commissioner to regulate the 
rate setting process for HMOs who sell certain Medigap products 
and to maintain the consumer friendly prescription drug benefit 
provisions in current policies. Although the Commissioner did 
not issue final regulations by the close of the fiscal year, the 
regulations which finally issued were responsive to the Attorney 
General ' s concerns . 



154 



Board Membership 

A member of the division sits as the Attorney General's 
designee on the Merit Rating Board which operates the Safe Driver 
insurance Program. During the fiscal year, the Division worked 
with other members of the Board to resolve favorably various 
audit issues raised by the state Auditor's Office. 

Guest Speakers 

Members of the Division made presentations to several 
organizations regarding insurance and financial exploitation of 
elderly. Members of the Division also participated in monthly 
discussions about the law with elementary students from Mission 
Hill as part of Bar Association's Partnership Among Lawyers and 
Students program. Some of these speaking engagements included 
presentations: at the Federal Reserve Bank in September, 1993, on 
the topic of Insurance as a Consumer Product; at the Jenks Center 
in Winchester in January, 1994, on Insurance and Seniors; at a 
Cable TV program sponsored by the Executive office of Elder 
Affairs and the Silver Haired Legislators in February, 1994, on 
Scams Against Seniors; at the Newton senior Citizen Center in 
May, 1994 on Insurance Issues of Concern to Consumers; at a 
training session for the Local Consumer Advocates (LCA) in April, 
1994 on "What Constitutes Insurance", to assist the LCA's in 
recognizing insurance scams and identifying unauthorized 
insurance products; at continuing professional education programs 
for judges, attorneys, and human resource personnel in Natick and 
Boston in March, 1994, on legislation affecting health insurance 
for children; at a joint regional meeting of the National 
Association for Consumer Agency Administrators and American 
Association of Retired Persons (AARP) in April, 1994, on 
Protecting Elders from Financial Exploitation, at The Attorney 
General's Elder Task Force in May, 1994 on Insurance Issues for 
Elders; at a seminar sponsored by the Newton Library in June, 
1994, on Long Term Care Insurance. 

Publications : 



Overview of Mandated Dependent Child Health care Coverage 
Legislation , by Virginia A. Hoefling - Professional Education 

Systems, Inc . , March, 1994 and Family Law Year In Review '94 
April, 1994 

ESTIMATED SAVINGS TO CONSUMERS 

Auto Rate Cases $89,000,000 

Health Insurance Rate Cases $50,000,000 

Consumer Insurance Matters $1,693,000 

Consumer Hotline $171,000 

Total $140,864,000 



155 



PXreLIC UTILITIES 

I. GENERAL RATE CASES 

A. New England Telephone's proposed Alternative Form of 
Regulation, docket DPU 94-50. 

On April 14, 1994, NET filed with the Department of Public 
Utilities ("DPU or the "Department") a petition for a new form of 
regulation known as "Price caps" . This case is important because 
it will likely change the DPU'S method of regulation of NET, with 
possible harm to captive ratepayers in Massachusetts if certain 
protections are not ordered. 

Under the Company's proposed alternative regulation plan 
("Plan"), residential local rates would be capped at the current 
level for seven years. However, the Plan allows NET to raise its 
other monopoly rates every year based on the Consumer Price 
Index, while lowering competitive rates. NET would in all 
probability receive an annual increase in overall rates in each 
of the next 10 years. This translates into an annual revenue 
increase to NET in the range of $1.7 billion to $2.1 billion. 

On June 14, 1994, the Department denied the Attorney General's 
motion to dismiss absent a full rate review, finding that a rate 
case was not appropriate at this time because NET'S price caps 
proposal was not a "general rate increase" under G.L.c. 159, 20. 
Thus, the Department limited this docket to reviewing the 
Company's price caps proposal and considering proposed changes to 
it. 

B. Massachusetts Electric Company's ("MECo") Hazardous Waste 
Settlement, D.P.U. 93-194 . 

In December 1993, the DPU approved a settlement between the 
Attorney General, MECO and other parties on how MECO will pay for 
its hazardous waste clean-up costs (the total liability is 
estimated potentially at $40 to $225 million) . The settlement 
split the clean-up cost between shareholders, ratepayers and 
insurers. Specifically, the settlement provided that 
shareholders will pay $30 million towards the clean-up costs over 
the next two years, while ratepayers will pay $3 million per year 
towards the cleanup costs. The settlement also benefited 
ratepayers with a $30 million rate reduction during the first 
year of the agreement and a rate moratorium on increases for the 
second year. In addition, large industrial customers were 
offered 5% discounts in return for extended (five year vs. one 
year) commitments to remain MECO customers, which should enhance 
MECo ' s ability to reduce future power costs. 

C. Boston Gas Company, DPU 93-60. 

In April, 1993, Boston Gas company petitioned for a November 
1, $61M base rate increase. The Department accepted enough of 
the Attorney General's recommendations to reduce the increase by 
$22m, or over 35%. In addition, the Department agreed with the 
Attorney General that certain gas costs should be deferred. 



156 



Nevertheless, this decision had a significant impact on 
residential ratepayers; the $38. 9M rate increase raised winter 
rates for heating and non-heating residential customers by 11.74% 
and 16.27%, respectively. 

Also of note was the Department's change in treatment of 
profit margins from interruptible sales. To date, those margins 
have gone to firm ratepayers, but the Department here allowed the 
Company to keep 25% of the margins on interruptible and off- 
system sales (but not on capacity releases) after an $8M 
threshold is exceeded. 

D. Colonial Gas Company, D.P.U. 93-78. 

On April 15, 1993, Colonial petitioned the DPU for a general 
rate increase of about $10.8 million, or about 7.9% overall. The 
Company's proposal included disproportionate increases for the 
residential non-heating customers (in the Lowell service area the 
proposed increase was 16.0%, and on Cape Cod 14.9%.) In 
September 1993, the Department approved a settlement between the 
Attorney General and the Company, reducing the rate increase to 
$6.7 million or 4.9%, saving ratepayers $4.1 million or 38% of 
Colonial's requested increase. The settlement also substantially 
moderated the increases for residential customers. 

E. Essex County Gas Company, D.P.U. 93-107. 

In May 1993, Essex petitioned the Department of Public 
utilities for a $2.9 million or 7.25% general rate increase. In 
September, the Department approved a settlement between the 
Attorney General and the Company which reduced the proposed 
increase by $1.25m, or 42%. The allowed increase was $1,733,000, 
or 3.05%. 

II. ELECTRIC GENERATING UNIT PERFORMANCE AND FUEL ADJUSTMENT 
REVIEWS 

A. Western Massachusetts Electric Company, DPU 92-8C-A and DPU 
93-SC- A, for the annual periods ending June 1, 1992 and 1993. 
During those periods, the Company's nuclear units had extended 
operating problems. The Department agreed with the Attorney 
General and rejected WMECols claim of a "qualified" privilege 
against disclosure of "self-critical', reviews requested by the 
Attorney General. The DPU found that no such privilege existed 
in Massachusetts law and refused to create any new privileges. 
WMECO appealed the DPU ' s decision to the Supreme Judicial Court. 
On a procedural remand, the DPU rejected the Company's claim and 
again compelled production of the documents. Shortly thereafter, 
the Company and the Attorney General agreed to a settlement of 
the case and (several previous pending reviews) which was 
approved by the DPU in May, 1994. The settlement provided: (1) a 
base rate refund for all customers of $8 million per year for 20 
months beginning June 1, 1994 through January 31, 1996 ($13.3 
million total); (2) a moratorium on base rate increases until at 
least February 1, 1996; and (3) large industrial customers were 



157 



offered 5% discounts in return for extended (five year vs. one 
year) commitments to remain WMECO customers, which should enhance 
WMECo ' s ability to reduce future power costs, with an 
additional agreement that residential customers will not be 
charged any revenue lost as a result of the discount. The cash 
refunds and non-cash components of the settlement produce $22 
million worth of savings for ratepayers over the next 20 months. 

B. Boston Edison Company, DPU 93-lA-A , generating unit 
performance review for the year ending October 1, 1992. In 
hearings, the Attorney General investigated a number of operating 
problems at BECo ' s major generating units. In January, 1994, the 
DPU ordered disallowance of replacement power costs associated 
with 18 outage days for the Pilgrim Nuclear Plant, and 19.4 
outage days for Mystic 4. 

C. Boston Edison Company, DPU 94-lA , generating unit performance 
review for the year ending October 1, 1993. BECO agreed at the 
outset to refund replacement power costs associated with three 
outage days at the Pilgrim Nuclear Power Plant. In a Final Brief 
filed in June, 1994, the Attorney General identified a number of 
additional instances in which BECO had been imprudent and asked 
the DPU to refund to BECo ' s ratepayers the replacement power 
costs resulting from those episodes of substandard performance. 

A decision by the DPU is pending. 

D. Commonwealth Electric Company, DPU 94-3A. 

In April, 1994, the Department approved a settlement by the 
Attorney General and ComElectric to stabilize Commonwealth's fuel 
charge over the next four years. The settlement caps the fuel 
charge rate at $0,065 per KWH for three years, 1994-1996 and at 
$0,067 per KWH for 1997. Any unrecovered fuel-related costs 
would be deferred during those four years, and then recovered, 
with interest over the subsequent six years. The Attorney 
General and the Company negotiated the proposal in response to 
the highly volatile nature of the Company's fuel charge which has 
ranged from $0,046 to $0.91 per KWH since 1990. 

III. RESOURCE MANAGEMENT CASES 

A. Nantucket Electric Company Cable Proposal, D.P.U. 93-137. 

In June, 19 94, The Department approved a settlement between 
the Attorney General, the Company and the conservation Law 
Foundation which would permit the building of an underwater 
electrical cable from Harwich to serve the Island's electric 
needs. The settlement improved upon the Company's original 
proposal by requiring sufficient backup power to ensure 
reliability and by encouraging DSM and windpower efforts. 



B. Boston Edison Company Demand-Side Management 

1. BECO DSM Settlement Board, DPU 88-28 et al . and DPU 91-233. 
Pursuant to a 1989 settlement, the Demand-Side Management 

("DSM") Settlement Board supervises a $1 Million fund supporting 
BECO ' s Conservation and Load Management. The Attorney General's 
representative on this Board serves as chairman. In addition, 
the Attorney General's Office manages the fund including the 
procurement of and payment for services. The Settlement Board 
has undertaken the first comprehensive study from a utility 
perspective of identifying cost-effective application of 
renewable energy resources to reduce customer energy and demand 
requirements. Potential cost-effective applications include 
photovoltaics, solar water heating and other passive solar 
options, small scale wind and hydro. Ultimately we anticipate 
that an implementation plan and policy recommendations will be 
developed by BECO and state agencies. The Settlement Board also 
is conducting the first of its kind research project for a 
utility in the Northeast in identifying risk mitigation values of 
demand side management resources. The research is expected to 
produce risk mitigating strategies to lower costs and future 
price risks. 

2 . BECO DSM Collaborative Programs. 

The AG participated in a collaborative effort with Boston 
Edison in which it recommended and achieved the successful 
implementation of an HVAC retrofit pilot program. The program is 
the first of its kind in the country which takes advantage of a 
federal mandate to phase out CFCs as an opportunity to make 
efficiency improvements of approximately 30% in large commercial 
buildings. The energy savings occur during summer peak periods 
and thus reduce the need to build additional future capacity. 

3 . BECO DSM Monitoring & Evaluation Proceeding. 

The Attorney General identified biases in Boston Edison's 
estimates of incentives which significantly overstated savings. 
The DPU adopted the Attorney General's recommendations regarding 
acceptable program evaluations. As a result the Company's 
incentives and lost base revenues were lowered with adjustments 
of approximately $1.1 million, reducing the Company's request by 
15%. 

C . BECO Integrated Resource Management, D.P.U. 94-49. 

In March, 1994, BECO made its preliminary filing. The 
Attorney General participated in negotiations which have not 
yielded a settlement. Issues for litigation include Clean Air 
Act compliance, renewables, and level of DSM after 1994. 

D. Massachusetts Electric Company, DPU 92-217-A. 

In December 1993, the Department of Public Utilities approved 
a settlement of the 1994 and 1995 Conservation and Load 
Management ("C&LM") budgets by the Attorney General, the company 
and other parties. The approved settlement sets forth a C&LM 
budget level of $66.4 million for both 1994 and 1995. 



E. Boston Gas Company, D.P.U. 93-108 . In January 1994, the DPU 
agreed with the Attorney General and rejected Boston Gas' request 
to recover Demand-side Management ("DSM") incentives and lost 
margins for its residential and multifamily DSM programs. The 
DPU held that the Company first had to obtain approval, based on 
actual data under its "GEMS" method, of its evaluation and 
monitoring of DSM savings. This result is significant because 
the Department has previously held that the entire Massachusetts 
gas industry is authorized to utilize Boston Gas' GEMS results as 
a basis for each respective gas company's recovery of DSM lost 
margins, incentives and costs. 

F. Bay State Gas Company Integrated Resource Plan, D.P.U. 93-129. 
The Company requested approval of long range forecast of sendout 
and supply plan, and DPU support for a proposed natural gas 
pipeline from Maine to Haverhill. The Attorney General argued on 
brief that the record did not show which was the most economic 
option for future supply at this point, and so the Department 
should not express support for any particular supply option in 
this case. 

G. Gas Supply Purchase contracts : 

In January-April, 1994, the Attorney General participated and 
presented witness testimony regarding proposed contracts for 
major gas supply purchases by the various Massachusetts natural 
gas companies. While the Attorney General did not urge the DPU 
to find imprudence, he did advocate ways in which the Department 
should give the gas companies incentives to minimize their supply 
costs. In addition, in the Bay State case, the DPU agreed with 
the Attorney General and rejected Bay State's request to recover 
$344,246 in outside services and $812,890 in expenses associated 
with its gas management system through the CGAC . The Attorney 
General argued that these costs belong more appropriately in base 
rates . 

IV. GENERIC /RULEMAKING DOCKETS 

Mergers and Acquisitions, DPU 93-167-A. 

The DPU opened this investigation to determine whether 
changes were needed to permit mergers that would be "consistent 
with the public interest" as stated in G.L. c. 164, S 96. After 
comments were filed by the Attorney General and many 
Massachusetts utilities the DPU decided that it would not set a 
general policy but review each proposed merger on a case-by-case 
basis. The DPU determined that a company proposing a merger or 
acquisition must show that the costs or disadvantages of the 
transaction are accompanied by specific benefits to the 
ratepayers that warrant allowing the merger. 



160 



V. MISCELLANEOUS 

A. Consideration of Electric Market Reform . 

During the first of 1994, the Attorney General participated in 
a Task Force established by DOER commissioner Steve Remen. The 
purpose of the Task Force was to investigate possible ways to 
streamline state regulation of electricity markets in 
Massachusetts, including ways to introduce more incentive 
ratemaking and more market competition. Many proposals for 
increasing competition would cause monopoly customers to pay 
higher rates for at least several years (while competitive 
customers stand to benefit first from the introduction of 
competition.) Therefore, the Attorney General urged that any 
proposed changes be designed in a way that does not hurt captive 
customers by causing higher rates or leading to the loss of 
public goods currently enjoyed (e.g., reliable service cost 
effective DSM, low income rates, research and development). The 
final report of the Task Force was issued in June 1994. 

B . BECO-MBTA Contract, D.P.U. 94-lA. 



In 1993, BECO successfully bid to supply the MBTA's entire 
power needs, whereas previously the T had obtained its power from 
several electric companies. When BECO presented the proposed 
contract for review, the Attorney General discovered that the 
Company was proposing lower fuel charges for the T than for all 
other customers. In short, under its proposed fuel charge, 
BECO would be cross subsidizing the T's service with revenues 
collected from other customers. The Department allowed the 
contract, but denied BECo ' s request to recover such subsidies in 
the fuel charge. 

C. New England Power v. MBTA at the FERC : 

NEP, one of the companies which lost MBTA load to BECO, is 
seeking to charge the MBTA for "stranded investment". The 
Attorney General has intervened in this case which may have 
implications for electric retail competition. 

D. Federal Trade commission meeting on packaging disclosure 
requirements for compact fluorescent bulbs. 

In December 1993 and January 1994, the Attorney General 
provided written and verbal testimony expressing consumer 
protection concerns to both the FTC and at a subsequent meeting 
with the Consortium for Energy Efficiency ("CEE"). We are 
serving on a CEE subcommittee to make recommendations as part of 
CEE ' s campaign to promote residential and small commercial energy 
efficient lighting. The Attorney General wants to ensure that 
consumers and utility conservation programs are not frustrated by 
any possible lack of disclosure and/or misrepresentation of fact 
on Compact Fluorescent Lamp packaging. 



CIVIL INVESTIGATION DIVISION 

The Civil Investigation Division (CID) conducts investigations 
primarily for divisions within the Public Protection and 
Government Bureaus and, on occasion, for the Executive Bureau, 
Family and Community Crimes Bureau, or in connection with the 
Criminal Bureau. 

The major duties of Division investigators are: locating and 
interviewing victims, witnesses, subjects and others; obtaining 
and reviewing documentary evidence from numerous sources 
including individuals, corporations, and federal, state, county 
and municipal agencies; conducting surveillance, background 
checks and asset checks; analyzing financial records and 
performing other forensic accounting functions; and testifying at 
Grand Jury and trial . 

In fiscal year 1994, CID initiated 547 investigations in the 
following major areas: 

PUBLIC PROTECTION BUREAU 

Consumer Protection and Antitrust 

Investigators continued to perform their traditional role by 
assisting the office in bringing G.L. c. 93A enforcement actions 
against businesses and individuals in major consumer areas such 
as automobiles, health spas, travel, mobile home parks, home 
improvement repair, retail sales, hearing aids, advance fee loan 
scams and insurance/ investment scams affecting the elderly. 

CID also initiated several investigations and surveys to 
determine industry compliance with existing laws in the provision 
of uncompensated health care services, sales of cigarettes and 
lottery tickets to minors and other areas. 



162 



CIVIL RIGHTS DIVISION 

BIAS MOTIVATED AND OTHER CIVIL RIGHTS ACT CASES 

The Civil Rights Division has continued to actively enforce 
the Massachusetts Civil Rights Act, which authorizes the Attorney 
General to seek injunctive relief when the exercise of legal 
rights is interfered with by threats, intimidation, or coercion. 
In fiscal year 1994, the Division continued to combat violence 
and discrimination by obtaining a total of thirteen injunctions 
against 3 6 defendants who had interfered with the rights of 
Massachusetts residents on the basis of race, color, national 
origin, sexual orientation, and gender and to protect the First 
Amendment rights of a reporter and a member of a School Committee 
to expressing their views on controversial racial matters within 
their community. 

In what may be the first use of a civil rights statute in 
combating domestic violence, the Division obtained a precedent- 
setting preliminary injunction against a man who engaged in an 
alleged pattern of gender-based and hate-motivated threats, 
intimidation, and violence against four separate women over a 
three year period. Each woman is alleged to have been 
systematically deprived of her most basic rights through a 
pattern of verbal and physical abuse. Because the defendant was 
motivated by his alleged bias against women as a class, the 
Division argued that the abusive treatment of these women 
violated the Massachusetts Civil Rights Act. As a result of the 
injunction, any further threats or intimidation by the Defendant 
against women whom he is dating, could result in a substantial 
prison sentence. 

In other significant cases, the Division obtained injunctions 
against four males who terrorized an elderly woman with 
Parkinson's disease and her Haitian-American visiting nurse. The 
Division also obtained criminal indictments against an alleged 
member of the White Youth League, a racist skinhead group, for 
violating a civil rights injunction obtained by the Division in 
1991. 

HOUSING DISCRIMINATION 

The Attorney General's Civil Rights Division has acted on its 
commitment to ensuring fair housing by filing, prevailing at 
trial, or settling 32 cases of housing discrimination involving 
allegations of discrimination on the basis of race, familial 
status, marital status, receipt of a housing subsidy, gender, and 
sexual orientation. 

The Division has intervened in ten separate housing 
discrimination suits pending before the Massachusetts Commission 
Against Discrimination. These cases involve ten separate real 
estate agents in the Brookline and Newton area who have allegedly 
engaged in a practice of steering tenants with young children 



away from rental units with lead-based paint, thereby shielding 
landlords from the statutory obligation to delead rental units 
occupied by families with children under six years of age. By 
intervening in these cases, the Attorney General hopes to modify 
realtor practices, to educate tenants about the right to fair 
treatment in the housing market and to enlarge the pool of safe, 
affordable housing for families with children. 

On March 15, 1993, a Single Justice of the Supreme Judicial 
Court issued a precedent-setting decision granting summary 
judgment in favor of the Attorney General's Office and the Town 
of Barnstable. The Single Justice ruled that Old King Highway 
Regional Historic District Commission had no authority to 
litigate a case which had effectively halted construction of a 
3 5-unit affordable housing development for low income elderly 
individuals or families in Barnstable. The Court's holding that 
the chief executive of a city or town can control a town board's 
decision as to whether to challenge an affordable housing project 
in that city or town, will provide substantial protection against 
opposition to the construction of such projects statewide. On 
December 14, 1993 the Supreme Judicial Court affirmed this 
decision . 

In the case of Commonwealth v. Desilets , the Commonwealth 
alleged that the defendants had discriminated against an 
unmarried couple by refusing to rent an apartment to them based 
upon their marital status. The Attorney General filed an appeal 
to overturn a Superior Court judgment which exempted the 
defendants from compliance with the fair housing laws, based upon 
defendants' claim that their religious convictions prevented them 
from renting to the couple. 

The Attorney General's Office filed an appeal to overturn the 
Superior Court's ruling, arguing that the defendants' voluntary 
entry into the business of owning and renting residential 
property subjected them to the fair housing law, and that the 
Defendant's practice of religion was not burdened by the 
application of those laws. 

In July of 1994, the Supreme Judicial Court ruled on the case, 
holding that the Commonwealth must show a compelling interest in 
eliminating housing discrimination against cohabiting couples 
that is strong enough to justify the burden placed on the 
defendants' exercise of their religion. The Court remanded the 
case to the Franklin Superior Court for a hearing on that issue. 

In an Appeals Court decision. Commonwealth v. Robert and 
Florence Dowd , the trial court had awarded substantial attorneys' 
fees to the Attorney General, after he prevailed in a claim of 
housing discrimination based on marital status. The decision was 
appealed and in August of 1994 the Appeals Court ruled that 
because of limiting language in the statute, the Attorney General 
may not receive an award of attorneys' fees under General Law c. 
151B. 



EMPLOYMENT DISCRIMINATION 

In July 1994 the Division moved to intervene in cases filed 
before the Massachusetts Commission Against Discrimination, 
alleging that Bull HN Information System had discriminated 
against numerous former employees on the basis of their age, in 
violation of the state anti-discrimination act. The MCAD 
subsequently allowed the Attorney General's motion to intervene, 
which alleges that Bull KN engaged in a pattern of age 
discrimination in employee layoffs conducted since 1990. It is 
alleged that Bull HN has terminated older employees or forced 
them into early retirement while retaining and hiring younger 
employees . 

MORTGAGE LENDING DISCRIMINATION 

Since November 1992, Attorney General Harshbarger ' s Civil 
Rights Division has been involved in a comprehensive attack on 
fair lending barriers in the home mortgage lending industry in 
Massachusetts . 

In March 1994, in what may serve as a model for fair lending 
practices, the Attorney General and the Massachusetts Bankers 
Association and 27 banks and mortgage companies entered into an 
unprecedented and far reaching agreement to effect systemic 
reform of the mortgage lending industry in Massachusetts. 

The three year agreement stems from an investigation conducted 
by the Attorney General's Office which was prompted in large part 
by a 1992 study conducted by the Federal Reserve Bank. That 
study found that black and hispanic applicants were denied 
mortgages at a rate 60 percent higher than whites with similar 
financial circiomstances and credit histories. Under the three- 
year agreement, the MBA has agreed to establish six programs and 
initiatives to discourage mortgage lending bias. These include: 
a college level program to train and recruit minorities for 
employment in the mortgage lending industry, including a student 
apprenticeship program; the organization and sponsorship of a 
comprehensive statewide credit and homebuyer educational program; 
the development of a comprehensive diversity, fair lending 
training module; the promotion of legislation that will encourage 
banks to undertake self -testing and comparative file reviews; and 
an agreement to jointly work for legislation for which would 
create state co-insurance for nonconforming loans. 

The MBA has also agreed to ensure and to encourage its two 
hundred members to adopt internal practice changes including 
establishing a complaint management system, an ombudsperson to 
investigate complaints and internal second review programs; and 
designing a loan origination compensation structure that promotes 
low and moderate income lending. 

The Attorney General and the MBA also announced the 
appointment of a three-member panel of banking experts who will 



165 



be responsible for the review of certain previously denied 
minority loan applications. The panel will review up to 12 
minority applications from 24 separate institutions which the 
Federal Reserve identified in its 1992 study as potentially 
having been denied on an inappropriate basis. If the panel finds 
that any of the application were denied for discriminatory 
reasons, the applicant will be offered the choice of a $15,000 
settlement, a refinancing of their present mortgage or a new 
mortgage loan. 

The Attorney General also reached an agreement with First New 
Hampshire Mortgage Corp., one of the Commonwealth's largest 
residential mortgage lenders, to increase the company's 
relatively low number of minority loan applications. First NH 
agreed to establish model residential lending programs in 
Springfield and the Lowell, Lawrence, Haverhill areas as well as 
to make certain changes in the manner in which it handles 
residential loan applications in Massachusetts. 

The Division Chief also served as a presenter in two national 
mortgage lending discrimination conferences; one sponsored by the 
U.S. Department of Housing and Urban Development in January 1994 
and the other by the National Community Reinvestment Coalition in 
February 1994. 

POLICE RELATED MATTERS 

In a cooperative effort to promote civil rights, assist the 
police, and provide departments with technical assistance, the 
Attorney General's Civil Rights Division has continued to provide 
an extensive amount of civil rights training to police 
departments about subject matters including civil liability, 
sexual harassment, cultural awareness, hate crimes, and health 
clinic blockades and invasions. The Division has led or 
participated in many training sessions throughout Massachusetts 
including in the towns of Shrewsbury, Lincoln, Lowell, Woburn, 
Winchester, as well as at the State Police, Middlesex and 
Southeastern Massachusetts Police Academies. The Division also 
participated in the campus law enforcement statewide training 
program, sponsored by the Attorney General in January 1994. 

The Division has also continued to investigate allegations of 
police misconduct and issue comprehensive reports, and has worked 
with departments to take remedial steps when credible evidence is 
found to substantiate the complaints. As a result of the 
Division's investigation of certain practices of the Chatham 
Police Department, the Board of Selectman in the Town of Chatham 
established a Community Advisory Committee to assist the police 
in more effectively serving that community. 

The case of Commonwealth v. Adams , was a civil rights suit, 
filed in 1989, alleging that thirteen Boston Police officers used 
excessive force during the arrest of a motorist following a chase 
which ended in Brookline. After a two-week trial in January 1992 



166 



the Suffolk Superior Court issued a civil rights injunction 
against the individual police officers who had used excessive 
force during the arrest. A Supreme Judicial Court decision 
issued in December 1993 affirmed the court-ordered injunction, 
issued under the Massachusetts Civil Rights Act. 

In May of 1994, after extensive negotiations initiated by the 
Attorney General, a modified final judgment by agreement 
involving all of the defendants, was entered. Under the terms of 
the agreement, the injunction will be vacated as of December 31, 
1994. The parties also agreed to special supervision, training 
and reporting requirements through December 31, 1996. 

OPERATION RESCUE 

In response to numerous "rescue blockades" and clinic 
invasions that took place at Massachusetts health clinics which 
provided abortion and counseling services, in 1989 the Office 
filed a motion to join the ongoing case of Planned Parenthood v. 
Operation Rescue . A preliminary injunction was issued against 
Operation Rescue and other defendants in May 1990. After a two- 
week trial in Superior Court in 1991, a Permanent Injunction was 
issued against members of Operation Rescue which prohibited the 
blocking of entrances to clinics which provide abortion services 
and counseling. This injunction was appealed by the Defendants. 

In April 1994, the Supreme Judicial Court issued a precedent- 
setting decision which affirmed the trial court's permanent 
injunctive order against clinic blockades and invasions by the 
defendants. The decision is a vital enforcement tool both 
because of the penalties available to law enforcement for 
violation of the order and because the injunction is broad in 
scope, prohibiting the defendants not only from blockading 
clinics, but also from directing and instructing others to 
blockade clinics. 

As a result of this and earlier injunctions, 18 individuals 
have been found guilty of criminal contempt for violation of the 
court's order and no blockades have taken place since September 
1992. In 1994, a Clinic Access Law was enacted by the State 
Legislature which has made it a crime in Massachusetts to 
blockade clinics. 

GANG PROJECT ANNOUNCEMENT 

The Attorney General has announced his intention to use the 
Massachusetts Civil Rights Act as a tool against gangs who are 
engaged in a pattern of threats and intimidation and who prey 
upon law-abiding residents in Massachusetts. In appropriate 
cases referred to the Division in the future, the Division will 
strongly consider filing an MORA action against gang members 
whose terrorizing acts clearly deprive others of their most 
fundamental rights and freedom. 



LEGISLATIVE INITIATIVES 

The Attorney General sponsored a bill to provide to the 
Attorney General in civil rights enforcement actions the 
authority to obtain compensatory damages on behalf of victims of 
civil rights violations and to collect the costs of litigation 
and reasonable attorneys' fees. Under the proposed bill, courts 
would also have the discretion to order a proposed bill, courts 
would also have the discretion to order a civil penalty against a 
defendant for violation of the civil rights law. The bill also 
provides that any civil penalties, attorneys' fees and costs that 
are recovered would be deposited in a special state fund to 
finance future civil rights actions by the Attorney general, to 
fund community education, and to finance the development and 
implementation of model civil rights and law enforcement training 
programs . 

A law review article titled, "The Attorney General's Sponsored 
Bill to Amend the Massachusetts Civil Rights Act," co-authored by 
Attorney General Harshbarger and his Chief of his Civil Rights 
Division, published in the Boston University Public Interest Law 
Journal in the fall of 1993, discussed the proposed legislation. 

OTHER SIGNIFICANT DIVISION INITIATIVES 

In January 1994, the Attorney General's Civil Rights Division 
along with representatives of the U.S. Attorney's Office, 
District Attorneys' offices, local and state police departments, 
and the Federal Bureau of Investigations committed their 
resources and expertise to the formation of the 

Law Enforcement Hate Crimes Task Force . The Task Force members 
decided that the Civil Rights Division should serve as the 
central repository for all materials related to organized hate 
group activities in Massachusetts. The Division also developed 
an Intelligence Manual which summarizes all intelligence 
information collected related to organized hate groups and other 
hate crime activity in Massachusetts. The Task Force will focus 
on identifying organized hate groups, sharing information and 
expertise on hate groups, and coordinating federal and state law 
enforcement efforts to prosecute hate crimes at both the state 
and federal level. The Task Force is chaired by the Chief of the 
Civil Rights Division. 

The Chief of the Division also participated as an active 
member of the Supreme Judicial Court Commission on Race and 
Ethnic Bias in the Courts , including involvement in public 
hearings and participation in the drafting and editing of the 
final report. The final report is scheduled to be issued on 
September 21, 1994 

The Division Chief chaired, and division staff served as 
active members of the Boston Prosecutors-Police Civil 
Rights Task Force which coordinates the resources of local, 
state, and federal agencies to address civil rights issues 



168 



arising in Boston. The Task Force addressed civil rights 
harassment in South Boston and responded in a coordinated fashion 
to reported racial incidents in Charlestown. The Task Force has 
also met to develop strategies to apply civil rights laws to 
gang-related issues within the Boston Housing Authority projects. 

The Division also chaired an office-wide AIDS Privacy Task 
Force whose initiatives include outreach, legal research, 
developing priorities in regard to legislation, litigation, and 
confidentiality issues. 

DISABILITY RIGHTS PROJECT 

In June 1993, Attorney General Scott Harshbarger announced the 
establishment of the Disability Rights Project within the Civil 
Rights Division of this Office. With the inauguration of this 
Project, the Office of the Attorney General substantially 
expanded its ability to guard and enforce the rights of 
individuals with disabilities. Significantly, the Attorney 
General placed the Project within the Civil Rights Division to 
underscore the critical message that disability rights are civil 
rights . 

Since the announcement, the Project has been actively involved 
in a community education effort to increase public awareness 
about the establishment of the Project and disability law. The 
Project's audiences have included disability rights advocates, 
municipal officials and business owners. 

The Project has three priority areas: A) access to municipal 
events and services, B) fair housing rights for individuals with 
disabilities and C) access to and non-discrimination by private 
entities. In each of these priority areas the Project has been 
able to achieve solid results, all of which have been attained 
without having to file suit. 

The Project's efforts to increase access to municipal events, 
services and programs have been very successful. The Project 
received complaints from the citizens in the following 
municipalities: Canton, Carver, Chelsea, Clinton, Easthampton, 
Hingham, Marshfield, Sheffield, Southboro, Sturbridge, Templeton, 
Wareham and Woburn, who complained that the public meetings were 
being conducted in physically inaccessible locations. In each 
instance, the Disability Rights Project contacted municipal 
officials and requested that they cease convening public meetings 
in those locations. In each instance the officials responded by 
immediately moving all open meetings conducted by the local 
committees and boards to alternative accessible facilities. The 
Project has also worked with the towns to establish policies 
which ensure that all municipal services are provided in an 
accessible manner. In addition, a number of towns, including 
Canton, Clinton, Marshfield, and Woburn, have allocated 
substantial sums of money for accessible renovations that will 
afford access to their town building. 



169 



The Project had significant accomplishments in the area of 
affording access to and non-discrimination by private businesses. 
Businesses have been utilizing the Project in a consulting 
capacity as they move forward to build or reconstruct their 
facilities to afford access and redraft policies to ensure non- 
discrimination against individuals with disabilities. The 
Project has sought to respond to complaints against companies in 
a nonadversarial manner which has enabled us to resolve the 
issues successfully without litigation. For example, the Project 
received a complaint that an individual who is deaf experienced 
difficulty in attempting to obtain services at New England 
Telephone's (NET'S) service center in Hyannis. The individual 
sought to clarify a billing dispute. Typically, a customer can 
resolve such issues by using a free phone in one of the company's 
service center to talk to a supervisor. When this individual 
indicated his need to use a TTY (text telephone) , he was informed 
that the customer service center did not have a such equipment. 
The Project's follow-up factual investigation revealed that none 
of the phone centers were equipped with TTYs . 

When the Disability Rights Project contacted New England 
Telephone, the Company immediately responded to the issue, 
proposing a solution which not only served the needs of 
individuals in Massachusetts, but throughout the Company's five- 
state service area. NET agreed to install TTYs in each of the 21 
Customer Service Centers throughout New England. 

In another case, the Project reached a settlement with 
Plymouth Brockton Bus Co. (P & B) in which they agreed to modify 
their policy and practice for provision of accessible bus 
service. The issue was brought to the Project's attention 
growing out of a concern that P & B's existing policy of 
requiring a 24-hour advance reservation prevented persons with 
disabilities from effectively being able to use P & B. The 
problem was particularly acute when members wished to use 
accessible buses going to and from the airport or Boston. After 
a series of meetings with P&B, the agreement provided for a much 
shorter advance reservation requirement and other contingent 
arrangements so that individuals needing accessible bus service 
would avoid the risk of being stranded in Boston or at the 
airport . 

Private universities are also covered under this priority 
area. An early complaint concerned a local university's plan to 
hold their paralegal graduation in an inaccessible location. 
Although the woman herself could have, with difficulty, managed 
to attend the ceremony, several of her closest friends would have 
been precluded from attending the event. When the Project 
contacted the school's counsel, the school immediately agreed to 
move the graduation to a physically accessible location. 

In the third priority area, the Project has worked to enforce 
fair housing rights for individuals with disabilities. 



particularly those who encounter opposition to their desire to 
reside in the community of their choice. For instance, this 
office was contacted by representatives of Hope House concerning 
problems they experienced in connection with their attempt to 
develop a 10 person residence in Fall River for individuals 
diagnosed with AIDS. Their greatest obstacle was the City's 
zoning ordinances which interfered with the establishment of 
group residences in Fall River by limiting such groups to four 
unrelated persons living together without a special permit 
process. The Project sent a letter to the City Solicitor which 
discussed how state and federal laws applied to the Fall River 
ordinance. As a result of the letter, the City determined that 
Hope House was not subject to the ordinance, and issued a permit 
allowing the project to go forward. 

A woman with a seizure disorder contacted this Office when her 
landlord threatened to evict her, based upon the presence of a 
dog in her unit, in violation of the building's "no pet" rule. 
The complainant asserted that the dog had the ability to forewarn 
her of seizures. State and federal law requires that landlords 
make a reasonable accommodation in their rules, policies or 
procedures to ensure that an individual with a disability had an 
equal opportunity to use and enjoy a dwelling. (M.G.L. Ch. 151B 
§4) . After learning of a kennel that trains and certifies 
seizure dogs, the Project put the complainant and kennel in touch 
with each other. Within a week, the kennel had certified the 
complainant's dog as a Seizure Alert Dog and initiated a 
"continuing education and training" program. The complainant 
provided the landlord with the dog's certification and may now 
stay in the apartment. 

When Attorney General Scott Harshbarger announced the 
establishment of the Disability Rights Project, he specifically 
emphasized the importance of community education. To that end, 
the Project has conducted numerous informational sessions on the 
Project and have presented many trainings on disability law. 
Some of the notable events include: A) welcoming remarks and talk 
on the Disability Rights Project at a conference for individuals 
of color with disabilities, social service agencies and 
businesses serving that community, B) served as keynote speaker 
to 300 people at the Annual Consumer Conference sponsored by 
Massachusetts Rehabilitation Commission, C) presented ADA update 
at annual convention of Town Counsel and City Solicitors, D) 
presentation on the ADA and Libraries Seminar sponsored by the 
Social Law Library, E) wrote a chapter on Title II of the ADA and 
Municipal Law for inclusion in MCLE book on Municipal Law, and F) 
wrote a chapter on Legal Rights of Individuals with Disabilities 
in the School Context for MCLE on School Law and was panelist at 
MCLE conference. 

In an effort to further assist the individuals who contact the 
Project for information and assistance, the Project has prepared 
materials which address such subjects as municipal law, school 
law, employment rights of individuals with disabilities, and 



171 



questions and answers on Title II of the Americans with 
Disabilities Act. 

The work of the Disability Rights Project has been well 
received by the disability community. In fact, Attorney General 
Scott Harshbarger was awarded the first annual Access Plus Award 
by the Stavros Independent Living Center for his role in 
furthering independence for people with disabilities, for 
promoting their civil rights and for initiating the Disability 
Rights Project in his office. 

Civil Rights 

CID investigated "hate crimes," allegations of police 
misconduct and other violations of the Massachusetts Civil Rights 
Act by interviewing alleged victims, witnesses and, where 
appropriate, subjects of such investigations. In cases of 
alleged misconduct by police or others in law enforcement, 
investigators obtained and reviewed police reports, court 
documents and other available evidence. 

Environmental Protection 

Kid's role in EPD cases primarily involved locating and 
identifying assets of potentially responsible parties liable for 
paying costs incurred by the Commonwealth in the clean-up of 
polluted or hazardous waste sites. Investigators also located 
former employees and officers of defunct companies responsible in 
part for such violations, and reviewed, evaluated and analyzed 
financial documents and prepared ability to pay analyses. 

Public Charities 

CID investigated individuals and/or organizations who raised 
funds from the public, allegedly in violation of Massachusetts 
law. Investigators interviewed victims, usually business people, 
who made donations to a charity based on the misrepresentation of 
a solicitor. In some instances, solicitors posed as law 
enforcement or other public officials. On several occasions, 
investigators worked with local police departments, local 
district attorneys and neighboring state attorneys general in 
locating "couriers" who picked up donations. CID financial 
investigators reviewed and audited books, records and financial 
reports of many non-profit organizations. 

Regulated Industries Division 

Near the end of the fiscal year, investigators joined with PPB 
and RID attorneys in a project to review and investigate 
businesses and organizations which withheld from employees 
contributions for health care premiums, but failed to actually 
purchase the health insurance policy. Other cases investigated 
included the sale of fraudulent or costly life insurance and 
other policies to the elderly, sometimes by unlicensed insurers. 



Bureau Prosecutor 

Investigators worked with the Bureau prosecutor on several 
cases which resulted in indictments against a number of 
individuals for violations of the state's consumer protection and 
charities laws. Cases included home improvement rip-off s, 
hearing aid scams and illegal charitable fund raising. 

GOVERNMENT BUREAU 

Trial 

CID played a major role in the investigation of tort actions 
filed against the Commonwealth which included: the alleged abuse, 
mistreatment and deaths of clients in state care, alleged 
wrongful termination of state employees, and personal injuries 
and other damages which occurred on state-owned property and/or 
in accidents on state roads or involving state cars. CID also 
investigated cases of contract disputes and matters involved in 
eminent domain proceedings. 

CRIMINAL BUREAU 

Workers ' Compensation Fraud 

In conjunction with the protocols established by the Attorney 
General's Task Force to Reduce Waste, Fraud and Abuse in the 
Workers, Compensation System, CID investigated allegations that 
state employees or employees of self-insured companies were 
fraudulently receiving workers, compensation benefits. 

Investigators also began working with the Insurance Fraud 
Bureau of Massachusetts in a joint effort to investigate 
instances of premium avoidance by companies attempting to defraud 
insurers of monies owed for workers, compensation coverage. 

Fair Labor and Business Practices 

During the fiscal year the Attorney General's Fair Labor and 
Business Practices Division assumed some of the former 
responsibilities of the Department of Labor. CID financial 
investigators assisted FLBP inspectors and attorneys in the 
investigation of prevailing wage and nonpayment of wage cases. 
Other investigators assisted FLBP by performing intake and basic 
investigative functions. 



173 



Opened 


during 




FY 


94 


6/30/94 


76 




59 


27 




15 


37 




16 


18 




11 


13 




13 


7 




12 


3 




2 


361 




139 


2 




8 


1 




1 


es 2 




2 


547 




278 



STATISTICS 

CID opened 547 investigations in Fiscal Year 94, with 278 
investigations ongoing as of June 30, 1994. Case distribution by 
division and/or bureau is as follows: 



Consumer /Ant it rust 
Civil Rights 

environmental Protection 
Public Charities 
Regulated Industries 

PPB/Criminal 

Government 

Trial 

Workers' Compensation Fraud 

Family & Community Crimes 

Fair Labor and Business Practices 



CHIEF PROSECUTOR'S REPORT 

Introduction 

Since November 1992, a prosecutor has been dedicated full-time 
to the Public Protection Bureau efforts. with limited 
prosecutorial resources, the Chief Prosecutor, began the process 
of developing the criminal enforcement capability in the Public 
Protection Bureau primarily in the consumer and charities fraud 
areas. Under the direction and supervision of the Chief 
Prosecutor, bureau attorneys with the assistance of civil 
investigators successfully initiated the very first criminal 
prosecutions in priority Public Protection Bureau areas. In 
1993, a bureau attorney was designated as a half-time criminal 
prosecutor to assist in those efforts. 

Working with the Consumer Protection Division and Division of 
Public Charities in particular, enforcement efforts this past 
year focused on fraudulent home improvement contractors, scam 
businesses with a largely elderly customer clientele, and fraud 
by unlicensed practitioners. In an effort to enforce civil 
judgments and orders obtained by this office, particularly where 
con artists have ignored traditional civil remedies, charges of 
criminal contempt were also prosecuted. With a special emphasis 
on crimes where the victims are elderly, the Public Protection 
Bureau prosecuted a tour bus operator and hearing aid dealer who 
took advantage of senior citizens. 



174 



Parallel Proceedings Guidelines 

Since cases referred to the Public Protection Bureau may be 
evaluated for either civil or criminal enforcement, the 
possibility of contemporaneous criminal and civil proceedings has 
evolved. As a result efforts were also undertaken this year to 
develop guidelines for parallel civil and criminal proceedings 
within the Office. Under the direction of the Public Protection 
Bureau Chief with the assistance of the Chief Prosecutor and 
staff a complete manual for guidelines for parallel criminal and 
civil prosecutions for use in the Public Protection Bureau was 
developed. It is anticipated that training and implementation of 
these guidelines will take place in the coming year. 

Training 

As part of the development of the Bureaus criminal capability, 
Public Protection Bureau assistants received regular training in 
criminal practice and procedure. Criminal Bureau assistant 
attorneys general were utilized as invited speakers in cross- 
bureau training. Assistant Attorneys general, working with the 
Chief Prosecutor are now handling criminal cases from grand jury 
investigation or District Court complaint to disposition. In 
addition, training for support staff in preparing documents for 
criminal practice was provided by Joyce Kearney, support staff to 
the Chief Prosecutor. 

In the ensuing six months, the Criminal unit will continue to 
work with the divisions of the Public Protection Bureau to screen 
appropriate cases for investigation and prosecution and to 
enlarge the pool of assistant attorneys general available to 
handle criminal cases through expanded training efforts. 

Criminal Cases - 1993-1994 

5 Defendants Indicted 

4 District Court Complaints Obtained 

3 Complaints for Criminal Contempt 

4 Cases Tried in Superior Court (includes co-defendants) 

Cases Disposed 

6 Defendants convicted after trial 

5 Guilty Pleas 

$24,211 Restitution Ordered 

Summary Of Cases Disposed 

On 5/26/94 a tour bus operator was sentenced in Middlesex 
Superior Court to two and one half to three years state prison, 
with three to five years on and after suspended and an order of 
restitution of $16,821 for stealing funds for bus tours from 
elderly citizens. The tours were never scheduled and did not 
take place. 



175 



On 4/11/94 two former podiatrist whose licenses had been 
revoked but who continued to practice were convicted after trial 
in Suffolk Superior Court of practicing after license revoked, 
possession of class E substances and possession of hypodermic 
needles. One defendant received six months in the House of 
Correction; the other defendant received three years probation. 

On 5/3/94, a home health care provider who did not provide 
services after taking payments from a 104 year old woman plead 
guilty to larceny in Newburyport District Court. She was 
sentenced to six months in the House of Correction, suspended for 
eighteen months with conditions of probation which included $2000 
restitution. 

On 5/26/94 the same home health care provider pled guilty to 
larceny in Newton District Court and was sentenced to one year in 
the House of Correction, suspended for eighteen months with an 
order of restitution of $560 for not providing services after 
taking funds . 

In December, 1993 two defendants were convicted after trial in 
Middlesex Superior Court of criminal contempt for violating an 
injunction obtained under the Civil Rights statute for blockading 
and trespassing on facilities providing abortion services and 
counseling. The defendants were sentenced to six months in the 
House of Correction. 

On 2/15/94 a defendant pleaded guilty to five counts of 
larceny in Essex Superior Court for stealing from elderly 
individuals. The defendant sold hearing aids, collected payment 
and never provided them to the consumers . He was sentenced to 
two years in the House of Correction, suspended for four years 
with an order of restitution of $4180. 

On 4/27/94 the same defendant pleaded guilty to criminal 
contempt in Suffolk Superior Court for violation of a Suffolk 
Superior Court final judgment against him relating to his hearing 
aid business. He was sentenced to nine months in the House of 
Correction. 

On 1/10/94, a home improvement contractor was found guilty by 
a Middlesex Superior Court jury of eight counts of larceny for 
stealing money from customers by not providing any contracting 
services. He was acquitted on three counts. He was sentenced to 
two years in the House of Correction. 

On 6/14/94 a home improvement contractor was convicted in 
Plymouth Superior Court of one count of larceny over $250. He 
was acquitted on two counts of violation of the home improvement 
contractor registration law. He was sentenced on the larceny to 
two years in the House of Correction, six months to serve. 



176 



GOVERNMENT BUREAU 

The Government Bureau provides representation for the 
Commonwealth and its agencies and officials in all types of civil 
litigation, and for employees of the Commonwealth with 
respect to certain civil claims made against them resulting from 
the performance of their duties. The Bureau also provides advice 
and consultation to officials with respect to legal issues 
arising in connection with their official functions, particularly 
in instances where such advance consultation may serve to prevent 
unnecessary litigation. As in the previous three years, the 
Bureau in fiscal year 1994 continued and expanded its efforts to 
develop and maintain close working relationships with agency 
counsel and to provide them with information and advice on 
matters of broad common interest. Meetings with all agency 
general counsel were held in November, 1993 and May, 1994. In 
December, 1993, we published the third issue of the Agency 
Counsel Newsletter, containing reports on legal developments in 
areas of relevance to agencies of the Commonwealth generally. 

The Government Bureau consists of an Administrative Law 
Division and a Trial Division. During fiscal year 1994, three 
attorneys were assigned permanently to work in both divisions, 
and we continued to assign a sampling of cases from each division 
to attorneys in the other, so as to broaden the exposure of the 
attorneys in both to the full range of cases the Bureau handles. 
In addition, a number of particularly complex and significant 
cases were handled by teams assigned to both divisions. 

Both the Administrative Law Division and the Trial Division 
initiate affirmative litigation on behalf of state agencies and 
the Commonwealth and submit briefs amicus curiae in cases 
presenting issues of law affecting the Commonwealth's interests. 
The Administrative Law Division defends suits concerning the 
legality of governmental operations, particularly those seeking 
injunctive or declaratory relief. 

The Division is also responsible for legal review of all newly 
enacted town by-laws, and for preparation of legal opinions for 
constitutional officers, heads of agencies, and certain other 
officials concerning issues arising from the performance of their 
official duties. The Trial Division defends suits seeking 
damages or other relief for alleged wrongful acts of government 
officials or employees, particularly contract-related disputes, 
real estate matters, torts, civil rights violations, employment 
disputes and environmental claims. The Trial Division also 
reviews certain contracts, leases, bonds and various conveyancing 
documents submitted by state agencies for approval as to form. 
In both Divisions, we have made focused efforts to bring to 
closure cases that had remained pending but dormant, and to close 
cases as soon as possible after judgment. This effort, 
facilitated by increased use of the office's improved Management 
Information System, has yielded dramatic results. 



177 



In fiscal year 1994 the Administrative Law Division closed 
more than ten times the number of cases closed in fiscal year 
1992, and twice the number closed in 1993. In the Trial 
Division, specifically in the area of tort cases under c. 258, 
the number of cases closed in fiscal year 1994 was five times the 
number closed in fiscal year 1992 and nearly twice the number in 
fiscal year 1993 . 

AFFIRMATIVE LITIGATION 

In addition to managing substantial defensive caseloads, 
Government Bureau attorneys maintained an active and varied 
docket of affirmative litigation in fiscal year 1994. Most 
often, these were suits brought on behalf of a state agency to 
resolve a dispute related to the discharge of the agency's 
mission or responsibilities. A number of significant affirmative 
cases were commenced and a number of others concluded in fiscal 
year 1994. 

We received favorable decisions from the Supreme Judicial 
Court in two affirmative matters. In Commonwealth v. Boston 
Redevelopment Authority , the Court entered a declaration that 
allows construction of a new Suffolk County courthouse to proceed 
on New Chardon Street in Boston on a parcel that was purchased by 
the Commonwealth from the BRA in 1965. The Court rejected the 
BRA'S claim that the purchase price for the land must be 
substantially increased on account of alleged violations of a 
land disposition agreement executed at the time of the purchase. 
In The Matter of the Liquidation of American Mutual Liability 
Insurance Company , the Court held that the Commissioner of 
insurance, when appointed receiver of an insolvent insurance 
company, has exclusive authority to assert and settle claims on 
behalf of the company, subject to court approval. 

Significant results in other affirmative matters were obtained 
at the trial court level. Commonwealth v. Massachusetts 
Republican State Committee was an action against the 
Massachusetts Republican State Committee (RSC) for violations of 
state campaign finance laws arising from a fundraising venture, 
known as the Commonwealth Business Council, in which limited- 
admission fundraising events were promoted as opportunities for 
access to high level appointed state officials. The case 
resulted in a Consent Judgment under which the RSC is permanently 
enjoined from using appointed state or local officials as a 
"draw, , in political fundraising; the RSC was also required to 
pay a substantial monetary penalty and to fund an independent 
audit of its financial records for 1992 and 1993 . In 
Commonwealth v. Mayor and Clerk of Boston , the Commonwealth seeks 
to require the City of Boston annually to comply with its 
statutory duty to submit to the state Jury Commissioner a list of 
all Boston residents potentially eligible for jury service. 
Under an interim agreement reached in the case in August 1993, 
the City undertook a door-to-door canvass of ninety-two (92) 



178 



precincts and identified an additional 50,000 persons eligible 
for jury service. 

In PEP V. Barnes and Noble , we obtained a substantial monetary 
settlement in an action to recover losses incurred by the 
Department of Environmental Protection when a water tower on a 
neighboring building fell on the roof of its Boston offices. In 
Curtis V. Falmouth School Committee , the Superior Court dismissed 
a constitutional challenge to the Falmouth School Committee's 
decision to make condoms available to students as part of its 
AIDS prevention program and, in doing so, adopted our position 
taken in an amicus curiae brief filed on behalf of the Department 
Public Health and the Department of Education. 

Significant claims that were asserted in FY 1994 for 
Commonwealth agencies included: National Relocation v. 
Kerasiotes , wherein Bureau attorneys brought counterclaims for 
fraud and violation of the state false claims act against a 
company seeking allegedly inflated relocation assistance benefits 
in connection with the Central Artery project; Commonwealth v. 
Federal Deposit Insurance Corporation , an action on behalf of the 
state Treasurer to recover millions of dollars in abandoned bank 
deposits held by the FDIC in its capacity as the receiver for 
several failed Massachusetts banks; Commonwealth v. U.S. 
Department of Transportation , an action on behalf of the state 
Department of Environmental Protection challenging a ruling by 
the U.S. Department of Transportation that Massachusetts' 
requirement that hazardous waste transporters post a bond with 
the state is preempted by federal law. Also, in Michigan, et al. 
V. Secretary of Energy . Massachusetts has joined nineteen other 
states before the United States Court of Appeals for the District 
of Columbia Circuit to seek a declaration that, beginning in 
1998, the U. S .Department of Energy is obligated under federal law 
to store the high-level nuclear waste generated at the nation's 
commercial reactors . 

In fiscal year 1994, the Government Bureau, with the Civil 
Rights Division, continued to represent state agencies in legal 
matters related to providing housing for persons with mental 
illness, mental retardation and AIDS. A siting dispute in Fall 
River was successfully resolved without litigation, allowing for 
the construction of a residence for persons with AIDS. Bureau 
attorneys also provided assistance to state agencies in disputes 
that arose in connection with the development of a fifty unit 
residential project in Boston which will serve, among others, 
persons with AIDS and persons with mental illness. 

Bureau attorneys also took leading roles in inter-bureau 
initiatives involving the development of a public-private program 
for enforcement of the housing code and rehabilitation of 
abandoned housing, the investigation of discrimination in 
employment and mortgage lending, and criminal prosecution of 
insurance fraud. 



179 



AMICUS CURIAE BRIEFS 

Bureau attorneys filed several briefs amicus curiae in the 
Supreme Judicial Court of Massachusetts on matters of importance 
to the Commonwealth and its agencies. Briefs in three cases 
addressed the application of the public duty rule, as codified in 
the 1994 amendments to the Massachusetts Tort Claims Act: 
Carleton v. Town of Framingham ; Celesta v. Town of Watertown ; 
and Pallazola v. Wachenhut Corporation . Another amicus brief, 
in Horta v. Sullivan, analyzed the principles underlying the 
discretionary function exception to the Tort Claims Act and 
applied that analysis to the question certified to the Supreme 
Judicial Court by the United States Court of Appeals for the 
First Circuit. Our amicus brief in Loves v. City of Peabodv 
concerned the analysis to be applied to the constitutionality of 
certain environmental regulations under the takings clause. In 
Burlington v. Bedford , the Supreme Judicial Court adopted the 
position presented in our amicus brief, holding that a taking of 
land that deprives an abutting landowner of all future access 
across the condemned property to public ways does not give rise 
to a claim for "special and peculiar,, damages under the eminent 
domain statute. In Clean Harbors of Braintree, Inc. v. Board of 
Health of Braintree , the Supreme Judicial Court agreed with our 
position that an outside section of an appropriations act, 
permitting Clean Harbors to continue operating a hazardous waste 
facility in Braintree without obtaining a site assignment from 
the Town, did not violate a statutory prohibition on addressing 
non-appropriations matters in appropriations acts. 

We also filed two amicus briefs in the federal courts. In the 
First Circuit Court of Appeals, we argued in Rhode Island v. 
Narragansett Indian Tribe that New England states retained 
authority to regulate or prohibit gambling on Native American 
tribal land, due to federal legislation approving land claims 
settlements between tribes and states. In Re Cumberland Farms, 
Inc., we argued to the Bankruptcy Court for the District of 
Massachusetts that bankruptcy courts may not ignore state law 
time limitations in adjudicating real estate tax abatements. 

ADMINISTRATIVE LAW DIVISION 

During fiscal year 1994, the Division opened 1,163 cases and 
closed 1,150 cases. Cases handled by Division attorneys resulted 
in one reported decision of the United States Supreme Court, 
twenty-nine reported decisions of the Supreme Judicial Court, 
nine reported decisions of the Massachusetts Appeals Court, 
twelve reported decisions of the United States Court of Appeals 
for the First Circuit, and four reported decisions of the United 
States District Court for the District of Massachusetts. As 
well Division attorneys were involved in many cases in those 
courts and in the state trial courts that resulted in unpublished 
decisions . 



180 



1 . Defensive Litigation. 

In West Lynn Creamery, Inc. v. Commissioner of Food and 
Agriculture , a United States Supreme Court case handled by the 
Division in fiscal year 1994, the Court struck down, on 
Commerce Clause grounds, a milk pricing order that imposed an 
assessment on milk dealers and granted a subsidy to dairy 
farmers. In a related case, Adams v. Watson , the United States 
Court of Appeals for the First Circuit ruled that out-of-state 
dairy farmers had standing to challenge the pricing order. 

The Division continued its efforts during fiscal year 1994 to 
terminate or reduce judicial oversight under consent decrees 
regarding public institutions. After remand from the United 
States Supreme Court, in Inmates of Suffolk County Jail v. 
Sheriff of Suffolk County , we moved to vacate the consent decree 
prohibiting double-bunking at the new Suffolk County Jail; that 
motion was denied by the United States District Court, and the 
denial was affirmed on appeal. The District Court subsequently 
allowed the Sheriff's motion to permit some double-bunking. In 
King v. Greenblatt , the United States District Court denied our 
motion to modify the consent decree to permit transfer of 
responsibility for the Treatment Center for the Sexually 
Dangerous from the Department of Mental Health to the Department 
of Correction, as directed by the State Legislature. 

The Division spent significant time and resources in fiscal 
year 1994 defending a variety of cases involving health care. In 
two Medicaid cases , Jewish Memorial Hospital v. Department of 
Public Welfare and Youville Hospital v. Department of Public 
Welfare , the Supreme Judicial Court held that state rules for 
determining the level of care in chronic disease and 
rehabilitation hospitals do not conflict with statutory 
prohibitions against regulations fixing criteria for medical 
necessity; the Court further held that, to the extent that other 
provisions of state law may jeopardize federal reimbursement of 
Medicaid expenditures, the Department of Public Welfare is not 
required to implement them. Other Medicaid cases handled by the 
Division included St. Margaret's Hospital v. Commissioner of 
Public Welfare , in which the Appeals Court upheld the Department 
of Public Welfare's denial of Medicaid benefits on the grounds 
that the claimant was not treated for an "emergency medical 
condition, " and Baystate Medical Center, Inc. v. Rate Setting 
Commission , in which the Appeals Court ruled that, in reviewing 
Medicaid rates set by the Rate Setting Commission, the Division 
of Administrative Law Appeals properly declined to consider 
evidence that the hospital had not first presented to the 
Commission. In a substituted judgment case. In the Matter of 
R.H . , the Appeals Court vacated a Probate Court ruling that a 
mentally retarded resident of the Fernald School would not, if 
competent, choose to undergo kidney dialysis treatment. The 
Court remanded the case for further findings and ordered that the 
resident undergo a trial run of dialysis. 



other significant litigation involved social service and 
welfare benefits to children and families. In re Gail , the 
Supreme Judicial Court held that the Children in Need of Services 
statute does not condition a child's out-of-home placement on 
parental consent, does not require the court to dismiss the 
proceeding on the parent's motion, and does not violate 
constitutional due process requirements. In Henley v. 
Commissioner of Public Welfare , plaintiff challenged a state 
statute requiring the Department of Public Welfare to add 
children who are recipients of Aid to Families with Dependent 
Children ("AFDC") residing with nonparent relatives to the 
"assistance unit" of such relatives, thereby preventing these 
children from receiving larger AFDC grants as independent units, 
except in cases of undue hardship. The Appeals Court upheld the 
Department's decision that the plaintiff had not demonstrated 
undue hardship and rejected the plaintiff's challenge to the 
"undue hardship" standard as unconstitutionally vague. The 
Division also represented state agencies and officials in a 
variety of cases involving environmental and wildlife 
conservation issues. In Sierra Club v. Environmental Protection 
Administration , the United States Court of Appeals upheld the 
District Court's dismissal of a Clean Air Act challenge to the 
Central Artery /Third Harbor Tunnel project, ruling that the 
tunnel ventilation system is not a "stationary source, " such as a 
factory, and so need not meet certain statutory requirements. In 
a related decision, the Court of Appeals upheld the Environmental 
Protection Agency's approval of an amendment to the State 
Implementation Plan under the Clean Air Act establishing a new 
regulatory scheme for tunnel ventilation systems. In a case 
arising from the Boston Harbor cleanup. Bays Legal Fund v. 
Browner, the United States District Court upheld the legality of 
a sewer outfall pipe under the Endangered Species Act, holding 
that there was no showing that the outfall would harm whales or 
other endangered species and that the Massachusetts Water 
Resources Authority was preserving its options in case further 
federal review indicates a need for additional protective 
measures. In another Endangered Species Act case, American Bald 
Eagles v. Bhatti , challenging the Quabbin Reservoir deer hunt as 
a threat to the bald eagle, the Court of Appeals affirmed the 
District Court's judgment in the Commonwealth's favor, based on 
the lack of evidence of "actual harm" to the endangered species. 
In Animal Legal Defense Fund, Inc. v. Fisheries and Wildlife 
Board , the Supreme Judicial Court held that the plaintiffs lacked 
standing to challenge the constitutionality of the statutory 
qualifications for certain seats on the Fisheries and Wildlife 
Board. In Davrod v. Coates , the United States District Court 
rejected plaintiffs' challenge to a state squid regulation, 
finding no adverse effect on the plaintiffs or on interstate 
commerce. 

Applications for court-awarded attorney's fees continue to 
generate a significant amount of litigation. In Brewster v. 
Dukakis , the United States Court of Appeals modified a District 
Court order barring all further fee applications in this 17-year- 



old consent decree case involving services for the mentally ill 
at Northampton State Hospital and in Western Massachusetts 
communities. The Court affirmed, however, the part of the 
District Court's order barring fees for "monitoring" by 
plaintiffs, counsel after the final order on the merits entered 
in January 1992. In Witty v. Dukakis , the Court of Appeals 
upheld the District Court's denial of plaintiff -interveners ' 
motion for attorney's fees on the ground that the motion was 
untimely under the Local Rules. In McNamara v. Dukakis , an 
action to prevent reduction of mental health services following 
state budget cuts, the United States District Court rejected as 
much of plaintiffs' motion for attorney's fees as was based on a 
"catalyst" theory, finding that plaintiffs had failed to show a 
causal relation between their suit and the subsequent restoration 
of various mental health programs. In Department of Public 
Health v. Chris K ., a special education case that was settled, 
the United States District Court awarded attorney's fees to the 
student. In doing so, the court rejected most of our arguments 
for reducing the amount of fees to be awarded, including our 
contention that no fees should be awarded for time spent on an 
unsuccessful handicap discrimination claim. In another matter 
involving attorney's fees, T.P. v. DuBois , the District Court 
struck down, on constitutional and statutory grounds, a state 
statute providing for recoupment of attorney's fees for appointed 
counsel from mental patients, client-funds accounts. 

The Division also represented state agencies and officials in 
a variety of cases involving state employment policies and 
practices. In Gately v. Commonwealth of Massachusetts , the 
United States Court of Appeals affirmed a District Court order 
preliminarily enjoining the Commonwealth, on age discrimination 
grounds, from mandatorily retiring members of the state police at 
age 55; the United States Supreme Court denied our petition for 
certiorari. In Weaver v, Henderson , the United States District 
Court entered judgment in favor of the defendants on plaintiffs, 
claim that the State Police's no-mustache rule was arbitrary. In 
Boston Police Superior Officers Federation v. Civil Service 
Commission , the Appeals Court upheld the Civil Service 
Commission's ruling that a police promotional examination that 
did not include a performance component did not constitute a fair 
test of supervisory skills and abilities. In Johnson v. 
Superintendent . Massachusetts State Police, the Supreme 
Judicial Court ruled that the Superior Court lacked jurisdiction 
over a state trooper's action to enjoin the imposition of 
disciplinary sanctions; the Court held that the District Court 
had exclusive jurisdiction over such actions. 

The Division also handled a number of significant tax cases in 
fiscal year 1994, including Filios v. Department of Revenue , in 
which the Supreme Judicial Court upheld the Commissioner of 
Revenue's determination that the Massachusetts tax exemption for 
contributory pensions does not discriminate against federal 
pensioners, and the United States Supreme Court denied 
plaintiffs' petition for certiorari; Koch v. Commissioner of 



183 



Revenue , in which the Supreme Judicial Court affirmed the 
Appellate Tax Board's decision in favor of the taxpayer and 
granted an abatement totaling $46 million including interest; 
Commissioner of Revenue V. Chinchillo , in which the Supreme 
Judicial Court accepted the Commissioner's interpretation of a 
statute governing taxation of interest income arising from an 
installment sale; AMIWoodbroke v. Commissioner of Revenue , in 
which the Supreme Judicial Court held that the taxpayer's 
interest-free loans to its non-taxpayer corporate parent were 
"services performed" for the parent such that the Commissioner 
was authorized to impute interest to the taxpayer and assess 
taxes based on that interest; and Yankee Companies. Inc . 
V. Commissioner of Revenue , in which the Appeals Court affirmed a 
decision of the Appellate Tax Board determining that a foreign 
corporation is subject to corporate excise tax on income derived 
from the purchase of accounts receivable from a foreign sister 
corporation. 

Among the significant utilities cases handled by the Division 
this year were Boston Edison Co. v. Department of Public 
Utilities , in which the Supreme Judicial Court upheld the 
Department of Public Utilities' "truly extraordinary 
circumstances" standard for determining when a utility is 
entitled to a waiver of Department regulations compelling it to 
enter into a long-term contract with the winning bidder of a 
power solicitation; and Bosley v. Department of Public Utilities , 
in which the Supreme Judicial Court affirmed the Department of 
Public Utilities' decision not to expand the "primary calling 
area" for the North Adams telephone exchange. Other significant 
cases handled by the Division that were decided this year include 
Simas v. Quaker Fabric Corporation, in which the United States 
Court of Appeals for the First Circuit held that Massachusetts' 
Tin Parachute Statute, providing for severance benefits to 
employees who are laid off shortly before or after a corporate 
takeover, is preempted by ERISA, the federal retirement benefits 
statute; Town of Milton v. Commonwealth , in which the Supreme 
Judicial Court held that the Commonwealth had no statutory 
obligation to reimburse cities and towns for half the costs of a 
program providing pay increases to police officers who pursue 
higher education, unless the Legislature first appropriates funds 
for this purpose; City of Worcester v. The Governor , m which the 
Supreme Judicial Court upheld a variety of special education 
regulations, rate setting rules, and higher education admission 
requirements, which were challenged as violating Proposition 2 
1/2 's prohibition on new local mandates; Town of B rookline v. 
Secretary of the Commonwealth , in which the Supreme Judicial 
Court upheld the constitutionality of the House of 
Representatives' redistricting plan; Departmen t of Mental 
Retardation v. Kendrew , in which the Supreme Judicial Court 
granted the Department's petition for relief from a District _ 
Court order requiring the Department to provide specific services 
to a criminal defendant; and McGonigle v. Weld , in which the 
Supreme Judicial Court held that the Governor lacked authority 



under the State Ethics Law to suspend the elected Sheriff of 
Middlesex County upon his indictment. 

2 . Municipal Law 

Town by-laws, home rule charters, and amendments thereto are 
reviewed and must receive the approval of the Attorney General 
prior to becoming effective. The review function is 
performed by attorneys in the Municipal Law Unit within the 
Administrative Law Division of the Government Bureau. During 
fiscal year 1994, the Municipal Law Unit reviewed 1,959 by-laws 
and 14 home rule actions from over 3 00 towns. Ninety 
submissions, 4.7 percent of the total, were is approved in whole 
or in part. 

The by-laws reviewed this year consisted of 886 general by- 
laws and 1,073 zoning by-laws. General by-laws pertain to town 
governinent and the exercise of municipal power. Zoning by-laws 
are a continuing exercise of local police power over the use of 
land. Zoning by-laws often generate the most local controversy 
since they affect what landowners consider as their basic 
constitutional right, i.e., to own, use, and enjoy their 
property. During this past year, consistent with the last 
several years, municipalities addressed through by-law enactments 
pressing environmental concerns, including groundwater 
protection, sewage disposal, and wetlands protection. 

In addition to reviewing by-laws, the Municipal Law Unit 
publishes the semi-annual Municipal Law Newsletter, which 
provides municipal officials with up-to-date information on 
developments in the law governing their functions. During fiscal 
year 1994, issues of the Newsletter were published in November 
1993 and May 1994. 

3 . Opinions 

The Attorney General is authorized by G.L. c. 12, 3, 6, and 9 
to render formal opinions and legal advice to constitutional 
officers, agencies and departments, district attorneys, and 
branches and committees of the Legislature. Formal, published 
opinions are given primarily to the heads of state agencies and 
departments. Less formal legal advice and consultation is also 
available. Guidelines to the formal opinions process are 
available from the Opinions Coordinator, as is information about 
the informal consultation process. 

The questions considered in legal opinions must have an 
immediate, concrete relation to the official duties of the state 
agency or officer requesting the opinion. Hypothetical or 
abstract questions, or questions which ask generally about the 
meaning of a particular statute, lacking a factual underpinning, 
are not answered. 



185 



Formal opinions are not offered on questions raising legal 
issues that are the subject of litigation or that concern ongoing 
collective bargaining. Questions relating to the wisdom of 
legislation or administrative or executive policies are not 
addressed. Generally, formal opinions will not be issued 
regarding the interpretation of federal statutes or the 
constitutionality of enacted legislation. 

Formal opinion requests from state agencies that report to a 
cabinet or executive office must first be sent to the appropriate 
secretary for his or her consideration. If the secretary 
believes the question raised is one that requires resolution by 
the Attorney General, the secretary then requests the opinion. 

Between July 1, 1993 and June 30, 1994, two formal Opinions of 
the Attorney General were issued. An additional 52 written 
requests were handled informally. The formal opinions appear at 
the end of this report. 



186 



TRIAL DIVISION 

In fiscal year 1994, the Trial Division continued its efforts 
to review and improve its operations as part of implementation of 
the restructuring initiated the previous year. The standard 
procedures adopted in November, 1992, for all new cases, 
including the establishment of trial teams, the focusing of 
resources on the preliminary stages of litigation so as to 
promote early evaluation, preparation and resolution of cases and 
the maximum utilization of automated management information and 
calendaring systems to increase efficiency and effectiveness, all 
were refined and expanded. 

One of the highlights of these efforts was the issuance of a 
report by the Trial Division Settlement Taskforce in September, 
1993. The Taskforce had been convened in April of 1993 to review 
the Division's settlement practices and procedures in order to 
recommend ways to develop consistent standards for case 
evaluation and better approaches to the case negotiation process. 

The Report of the Taskforce identified several settlement 
criteria to be applied in all Trial Division cases as well as 
specific factors relevant to particular practice areas. A 
suggested settlement decision making format was proposed as were 
guidelines for considering alternative dispute resolution 
mechanisms . 

Two substantive program recommendations of the Taskforce 
already have been adopted and implemented. First, case review 
panels, consisting of attorneys and support staff have been 
established to review pending cases with the assigned attorney. 
The panel process gives the assigned attorneys an independent 
evaluation of their cases' strengths, weaknesses and relative 
settlement values. The data from these sessions are being 
collected for ultimate comparisons to actual results. 

Second, the Trial Division, working with the office's 
Management Information System staff, has developed a new computer 
program that will permit us to track and evaluate settlements and 
verdicts entered in our cases, so as to provide a realistic, 
consistent and dependable basis for measuring performance. The 
data will also be used as a quantifiable factor to be considered 
in improving future trial strategies and settlement negotiations 
in similar cases. 

During fiscal year 1994, the Trial Division closed 558 cases 
and opened 404 new cases, reducing the overall Trial Division 
caseload to 1,258 cases as of the end of the fiscal year. In 
addition, on-going efforts to review and reduce the number of 
pending Land Court registration matters has brought the open 
files down from approximately 500 to about 215. 

In the contract area, the Trial Division opened 81 new cases 
during the fiscal year and closed 89 cases. Judgments against 



187 



the Commonwealth and settlements in the 89 concluded cases 
amounted to approximately $10 million less than the plaintiffs 
had claimed. As of the end of fiscal year 1994, the Trial 
Division had approximately 256 contract cases pending, 
representing a total dollar exposure to the Commonwealth of 
approximately $50 million. 

As in past years, the largest category of contract cases 
involved construction contract disputes. These included bid 
protests, in which bidders for a sub-contract or general contract 
dispute the results of the competitive bid prior to the award of 
the contract, and claims for cost increases, in which contractors 
seek additional compensation due to delays, unexpected site 
conditions and the like. 

Significant construction contract or bid protest cases 
defended by the Trial Division during fiscal year 1994 included 
Middlesex Corporation v. P. Giosioso & Sons, Inc ., in which the 
Supreme Judicial Court, in an expedited appeal, vacated a 
preliminary injunction that had stopped the Massachusetts Highway 
Department from rejecting a low bidder due to its failure to 
satisfy the minority and women's set-aside requirements included 
in the bidding specifications. 

In JRJ Construction Co. v. Suffolk Construction , the Superior 
Court denied a subcontractor's claim for compensation for extra 
work performed at the New Braintree prison, based on contract 
terms providing that the Commonwealth is not bound by the 
architect's oral interpretation of construction bidding 
documents. Similarly, in Commercial Union Insurance Co. v. 
Cresta Construction Co . , a dispute arising out of a construction 
project at Medfield State Hospital, the Superior Court ruled, as 
a matter of first impression, that the Department of Capital 
Planning and Operations could not be held liable to an 
independent subcontractor. 

In a procurement contract bidding case . The Praxis Group, Inc. 
V. Fisher , the Superior Court denied a preliminary injunction 
against the Commonwealth arising from a computer purchase by the 
Department of Procurement and General Services. The Court ruled 
that the agency's decision to channel state and municipal 
computer purchases through three prime contracts was reasonable 
and within the agency's discretion. A Single Justice of the 
Appeals Court also denied preliminary injunctive relief. 

The Trial Division continued to see a steady flow of cases 
arising from agencies, termination of contracts and leases 
related to the provision of human services. In two major cases. 
Trial Division attorneys successfully defended against requests 
for preliminary injunctions. The plaintiffs in Habilitation 
Assistance Corp. v. Baker sought to enjoin the cancellation of a 
contract to provide day program services to clients of the 
Department of Mental Retardation. The Superior Court denied the 
request, relying on a contractual provision allowing termination 



188 



without cause by either party upon sixty days, notice. In 
Institute for Developmental Disabilities Inc.d/b/a Crystal S 
rings School v. Weld , the Superior Court denied the plaintiff's 
request to enjoin the transfer of any individuals from a school 
for the developmentally disabled, finding no likelihood of 
success on the merits of the plaintiff's claim of constructive 
debarment. In a similar type of case, the Superior Court in 
AFSCME V. Weld dismissed complaints by unions for relief with 
respect to the privatization of certain mental health and dietary 
services on the ground that the plaintiffs had failed to exhaust 
their administrative remedies. 

A number of significant breach of contract claims were 
successfully resolved by the Trial Division during fiscal year 
1994. In Heyman v. Commonwealth , the Appeals Court affirmed a 
judgment that the Commonwealth did not breach its contract in 
breaking off negotiations for the lease of office space after the 
selection of a bidder. The case of G.E. Stimpson Co. 
V . Commonweal th , in which the exclusive supplier of office 
supplies to all state agencies from 1985 to 1988 claimed a 
balance due of $832,000 for goods sold and delivered and $10 
million in other damages, was settled for $25,000. 

Finally, in Shelby Mutual Insurance Co. v. Commonwealth , 
several insurance companies were denied reimbursement for several 
million dollars in workers compensation payments from either the 
Commonwealth's General Fund or the Workers Compensation Trust 
Fund. The insurers' payments had previously been reimbursable 
from the Trust Fund, which had been exhausted. Amendments to the 
workers compensation law in 1985 substantially revised the Trust 
Fund and barred payment of the old claims. The Appeals Court 
held that, even though the amendments extinguished valid 
contracts and claims, they were reasonable and, therefore, 
constitutional . 

In addition to litigation, the Trial Division advises state 
agencies and officials on contract issues, including questions 
concerning the formation of contracts, performance, bidding 
procedures, bid protest, contract contents, contract 
interpretation and other miscellaneous macters. The most 
frequent requests during the fiscal year concerned 
indemnification clauses, procedural matters in employment 
contracts, and advice in advance of anticipated construction 
contract litigation. Requests for advice and assistance came 
from the Massachusetts Highway Department, Metropolitan District 
Commission, Executive Office of Transportation and Construction, 
Board of Regents of Higher Education, Department of Mental 
Health, Department of Mental Retardation, Department of 
Environmental Management, State Lottery Commission, Department of 
Public Welfare, and Division of Capital Planning and Operations. 
The Trial Division also reviews contracts, leases, and bonds 
submitted by state agencies for approval as to form. During the 
fiscal year, the Division received a total of 496 contracts to 



189 



review, approving 442 and rejecting 16, some of which were later 
approved after correction of defects in form. 

Two cases in which Trial Division attorneys represented the 
Contributory Retirement Appeals Board ("CRAB") resulted in 
appellate decisions during fiscal year 1994. In Mclntire v. CRAB , 
the Supreme Judicial Court held that an employee's rate of 
contribution to the retirement system is based on the date the 
employee became a member of the system, rather than the date the 
employee commenced employment. In McDonough v. CRAB , the 
Appeals Court affirmed the judgment of the Superior Court 
upholding CRAB'S denial of plaintiff's application for Accidental 
Disability Retirement benefits, noting that it is within CRAB ^ s 
discretion to give greater or lesser weight to an administrative 
law judge's findings. 

Trial Division attorneys handled diverse matters involving the 
real estate property interests of the Commonwealth. The vast 
majority of cases involve petitions for the assessment of damages 
resulting from land acquisitions by eminent domain pursuant to 
G.L. c. 79. During the 1994 fiscal year we disposed of 39 land 
damage cases, 11 by jury trial and 28 by settlement. The 
disposition of these cases resulted in savings to the 
Commonwealth of approximately $11.2 million based on amounts paid 
compared to amounts claimed. 

The Commonwealth's agencies acquire land for a variety of 
purposes, including roads, colleges, recreation and parks, 
landfills, agricultural and conservation restrictions, and 
easements. Agencies involved in such real estate matters include 
Massachusetts Highway Department, Metropolitan District 
Commission, the Department of Environmental Management, the 
Department of Environmental Protection, the Department of Food 
and Agriculture, the Department of Fisheries, Wildlife and 
Environmental Law Enforcement and the Division of Capital 
Planning and operations. 

Significant eminent domain cases resolved during the fiscal 
year included: Leedham v. Commonwealth , in which the Court 
granted the Commonwealth's motion for summary judgment based on 
the plaintiff's execution of a general release in the absence of 
any allegations of fraud or duress; Farrell Enterprise v. 
Commonwealth , arising from a partial taking by the Massachusetts 
Highway Department to improve the Northern Avenue Bridge, which 
the jury valued at $985,000, $5,515,000 less than the plaintiff's 
expert appraisal and $3 45,0 00 above the Commonwealth's appraisal; 
Peter Gray Corn. v. Commonwealth , concerning a taking by the 
Massachusetts Highway Department, in which the plaintiff claimed 
damages of $1,950,000, the Commonwealth's expert testified to 
damages of $670,000, and the jury returned a verdict of $969,000; 
Losurdo V. Commonwealth , in which the plaintiffs sought $15,000 
for the loss of trees plus $55,000 for loss of privacy resulting 
from the widening of a road by the Massachusetts Highway 
Department, the Commonwealth's expert testified to damages of 



190 



$2,580, and the jury awarded a total of $15,000; Hero Corp. v. 
Commonwea 1 th , in which the Appeals Court affirmed a favorable 
judgment setting damages for a Massachusetts Highway Department 
taking for construction of an access road to the Pittsfield 
airport, rejecting the plaintiff's challenge to unobjected on 
portions of the Commonwealth's expert testimony, as well as the 
failure to give certain jury instructions; Walukevich v. 
Commonwea 1 th , in which the Appeals Court affirmed a jury verdict 
of $67,500, the Commonwealth's expert appraisal, in a case in 
which the plaintiff sought $675,000 in damages; August v. 
Commonwealth , where the Appeals Court affirmed judgment for the 
Commonwealth, holding that unusable land beneath a road could not 
be included in calculating lot area for zoning purposes; LeClair 
v. Commonwealth, arising from a Massachusetts Highway 
Department taking of eight acres for ramp construction in which 
the Commonwealth paid a pro tanto of $19,400, the plaintiff 
claimed $110,000, and the jury valued the property at $47,300; 
Oueset Center Inc. v. Commonwealth , in which a developer of 
condominiums sought $270,000 for a permanent taking and 
subsequent 20-month project to install a new bridge and the 
jury returned a verdict of $61,000, roughly 22%r of the 
difference between the parties, appraisals; Gasbarro v. 
Commonweal th , involving land taken by the Massachusetts Highway 
Department, for which a jury awarded damages of $31,000, some 10% 
of the amounts plaintiff claimed for the taking, the loss of 
rental income during the course of construction and the permanent 
diminution in value of the remaining real property; Salem 
Country Club v. Commonwealth , in which the plaintiff sought 
$1,245,000 in connection with the taking, by the Massachusetts 
Highway Department, of approximately 18 acres of industrially 
zoned property in Peabody for the new connector between Routes 
95 and 128, and the jury returned a verdict of $850,000; and 
Ackerly Communications v. Commonwealth , in which the Superior 
Court held that the plaintiffs' contractual right to place signs 
on property taken for construction of the South Boston Haul Road 
for the Central Artery Project was not a lease but a license, the 
loss of which was not compensable under the eminent domain 
statute . 

Trial Division attorneys also have responsibility for 
protecting the Commonwealth's interests in all petitions for 
registration of land filed in the Land Court, and for reviewing 
as to form rental agreements, pro tanto releases, general 
releases, deeds, taking orders, and other conveyance documents 
relating to transfers from or to the Commonwealth as required by 
statute or requested by a state department or agency. 

The Trial Division also defends tort and civil rights cases 
brought against the Commonwealth and its employees. Most of 
these cases arise under the Massachusetts Tort Claims Act, G.L. 
c. 258, and federal and state civil rights statutes. In the 
torts area, the Trial Division opened 228 cases and closed 405 
cases during the fiscal year. The number of cases opened 
constitutes a nearly 40% reduction from the numbers of new tort 



191 



cases opened during the 1992 and 1993 fiscal years. We believe 
that this reduction reflects the impact of the new presentment 
procedures, including a new computer tracking system, that we 
developed and implemented with agency counsel in 1992 in order to 
encourage early investigation and, when appropriate, pre- 
litigation settlement of claims. 

We attribute this improvement to new procedures encouraging 
early disposition of appropriate cases, and to better case 
management practices utilizing the office's Management 
Information System. 

Three tort cases resulted in reported appellate decisions in 
fiscal year 1994. In Shweiri v. Commonwealth , arising from an 
injury to a patient at a Department of Mental Health facility, 
the Court affirmed a directed verdict for the Commonwealth, 
holding that, pursuant to G.L. c. 18, 55, the Commonwealth's 
liability in damages was offset by its Medicaid payments for 
treatment of the plaintiff's injuries. Trial Division attorneys 
assisted the Division of Medical Assistance in enforcing liens on 
tort recoveries in three other cases resolved in fiscal year 
1994. 

In Gilmore v. Commonwealth , the Supreme Judicial Court held 
that the plaintiff met the presentment requirement of the Tort 
Claims Act for his claim of negligent infliction of emotional 
distress in the death of his sister by sending the agency a 
letter claiming negligence in her death along with a copy of a 
related federal court action. The Court held that these 
materials provided sufficient information to trigger an 
investigation, even though they did not state the precise nature 
of the plaintiff's claim. In Montour v. Commonwealth . The 
Appeals Court ruled that the presentment requirement was not 
tolled by the plaintiff's alleged failure to perceive the extent 
of her injury due to traumatic stress. 

The Trial Division resolved four wrongful death cases during 
the fiscal year 1994. In West, Adm. v. Commonwealth , a jury 
returned a verdict for the Commonwealth, rejecting a claim that 
negligence of a state trooper during a high speed chase caused 
the death of one of the pursued motorcyclists. The Court granted 
summary judgment for the Commonwealth in Johnson v. City of 
Boston , finding no evidence that MDC police officers acted 
unreasonably in a high speed chase death of an individual who 
stole a bus. Claims against the Commonwealth were also dismissed 
in Kyle v. Commonwealth , arising from the death of a driver whose 
vehicle was pushed by a third party into a state highway 
guardrail and plunged into a canal. Finally, we settled the case 
of Roake v. Commonwealth , arising from the death of a patient at 
Bridgewater State Hospital. 

Cases presenting allegations of negligent arrest or execution 
of search warrants included Matt v. Commonwealth and DuPray v. 
Commonwealth, which were dismissed by the Superior Court on the 



192 



ground that the decision to arrest is discretionary, and Donahue 
V. Commonwealth , in which the Court ruled that the conduct of a 
search by the State Police was subject to the discretionary 
function and public duty exceptions to the Tort Claim Act. In 
Reale v. Commonwealth , a jury returned a verdict for the 
Commonwealth on the plaintiffs, claim that the State Police were 
negligent in the execution of a search warrant. 

Allegations of lead paint poisoning in subsidized rental 
housing units inspected by state agencies gave rise to three 

cases resolved in fiscal year 1994: Chak v. Commonwealth , 

Robert v. Fredericks , and Davis v. Parish . All three cases 
were settled based on assumption of primary liability by the 
owner of the premises. 

Other tort cases resolved at trial or on appeal in fiscal year 
1994 included: Pr indie v. Commonwealth , in which the Appeals 
Court held that a claim for injury caused by a 

defective traffic signal was subject to the limitations of the 
road defect statute; Rankin v. Commonwealth , arising from a 
slip and fall at a community college, which resulted in a jury 
verdict for half the amount of plaintiff's lowest settlement 
demand; Arrendel v. Roxbury Community College, involving a slip 
and fall at a community college in which the Court directed a 
verdict for the Commonwealth based on the lack of evidence that 
the college had knowledge of any defective condition before the 
incident; Eaton v. Commonwealth , involving a rear-end collision, 
in which a jury rejected the plaintiff's claim of $30,000 in 
damages and awarded only $4,800, which the Court reduced to zero 
based on the plaintiff's receipt of workers, compensation 
benefits; Najem v. University of Lowell , arising from a slip and 
fall in a restroom, n which the Court found no negligence in 
failure to discover water on the floor between 
regular inspections; and Wang v. Weddel and Commonwealth, an 
action by a former psychiatric inpatient for damages for a 
broken arm suffered while she was being restrained, which 
resulted in a jury verdict for the Commonwealth and its employee 
on civil rights and intentional tort claims and for the plaintiff 
on negligence, in an amount less than our offer of judgment. 

Other tort cases were resolved on pre-trial motions, 
including : Sanfillino v. J. F. White Contracting Co. and the 
Commonwealth , (claim based on detached guardrail held subject to 
limitations of road defect statute); West v. McNamara (driver's 
license suspension held to be discretionary function) ; O'Brien v. 
Modern Continental (contractor's claim for indemnification and 
contribution barred by road defect statute and contractual 
provision); Sullivan v. Commonwealth (claim for injuries from 
collision at repainting operation barred by road defect 
statute) ; Solomon v. Commonwealth (claim for injuries inflicted 
by escaped prisoner on work release barred by discretionary 
function doctrine and public duty rule) ; Cesar v. Commonwealth 
(public duty rule bars suit for injuries incurred in assault at 
University of Massachusetts athletic facility) ; and Brehm v. 



193 



city of Boston (claim for injuries incurred on sidewalk abutting 
state parking lot rejected for lack of evidence of state 
ownership or control) . 

Significant civil rights cases resolved in fiscal year 1994 
included: Miller v. Department of Correction , in which the 
First Circuit held claims of inadequate treatment by residents 
of the Treatment Center for the Sexually Dangerous barred by 
earlier adjudication of class actions involving conditions at the 
Treatment Center; Employee Staffing of America v. Linsky , in 
which the United States District Court dismissed a temporary 
employment company's claims of deprivation of property rights and 
defamation, arising from a dispute over the company's workers, 
compensation obligations; and Rodriguez v. Johnson , in which the 
United States District Court dismissed claims by a Treatment 
Center inmate based on an assault by another inmate. 

The Trial Division represented the Commonwealth in a wide 
range of employment related cases during fiscal year 1994, 
including cases alleging sexual harassment, unlawful discharge 
and other alleged violations of employees' rights. Two such 
cases gave rise to reported appellate decisions: in Pacillo v. 
Gutensohn , the Appeals Court affirmed a judgment for three 
Department of Environmental Management managers charged with age 
discrimination; in Chakrabarti v. Commonwealth , the First Circuit 
affirmed a judgment awarding damages to a former employee against 
his supervisor for intentional interference with contractual 
relations in connection with events leading to his discharge but 
also affirmed judgment for defendants on civil rights claims. 

Three employment cases went to trial in fiscal year 1994. In 
Hamlin v. Department of Social Services , the plaintiff claimed 
handicap discrimination based on the Department's failure to 
accommodate his alleged post-traumatic stress disorder by 
transferring him to a position that would not involve working 
with abused children. After the jury awarded approximately 
$78,000 in back pay, the trial court entered judgment 
notwithstanding the verdict for the Commonwealth. In Miller v. 
Department of Public Safety , a former state trooper terminated 
for misconduct claimed racial discrimination, citing more lenient 
discipline of non-minority troopers. A jury awarded him back pay 
but no damages for emotional distress, and the Court declined 
reinstatement or front pay. Finally, in Caron v. Silvia , a jury 
rejected a former Department of Public Welfare employee's claim 
that she was fired because she had spoken out on the issue of 
whether employees should be allowed to smoke at work. 

Other employment matters resolved included Petitti v. 
Department of Mental Health , in which the Court rejected claims 
of sex and age discrimination in the termination of the 
plaintiff's employment with the Department of Mental Health; and 
Howard v. Board of Trustees of Roxbury Community College , in 
which the Superior Court dismissed a wrongful termination claim 
by the former president of the college. 



194 



Two cases resolved in fiscal year 1994 arose from 
environmental regulation: In Warcewicz v. Felix , the Appeals 
Court rejected a claim for damages resulting from wetland 
enforcement efforts that the Supreme Judicial Court had ruled, in 
a separate case, were inconsistent with DEP regulations. In 
Nelson v. Commonwealth , the Superior Court dismissed a complaint 
of alleged regulatory takings on the Chatham Sand Bar that were 
already the subject of a pending appeal in the Appeals Court. 



195 



THE WESTERN MASSACHUSETTS DIVISION 

The Western Massachusetts Division of the office of the 
Attorney General is responsible for legal matters in the four 
western counties of Berkshire, Franklin, Hampden and Hampshire. 
The Division is located Springfield in newly renovated offices at 
the State Office Building at 436 Dwight Street. It is staffed by 
eight assistant attorneys general, investigators, support staff 
and a new State Police During fiscal 1994, the division was 
responsible for over 500 cases. 

The office litigates a wide range of defensive cases including 
tort contract, eminent domain, and administrative appeals. The 
successful efforts of the legal staff have saved the citizens of 
the Commonwealth many thousands of dollars. The office also 
handled hundreds of victim of violent crime claims. 

The division also includes a Medicaid Fraud Control Unit which 
prosecutes Medicaid fraud and patient abuse cases. 

The Consumer Protection Unit has handled many consumer 
complaints and has filed a number of complaints against 
businesses who have violated the Consumer Protection Act. 

The office has filed a number of civil rights claims on behalf 
of citizens whose constitutional rights have been denied by 
others. The office obtained what is believed to be the first 
injunctions in both Hampshire and Hampden counties protecting the 
rights of a lesbian woman and gay man. 

The addition of the State Police Unit and an assistant 
attorney general specializing in criminal prosecution has allowed 
the division to expand its role in prosecuting insurance fraud, 
consumer fraud, unemployment fraud as well as other white collar 
crime. The State Police arrested two probation officers who were 
allegedly receiving bribes. 

The Western Massachusetts Division looks forward to its 
ongoing role as a full service satellite of the Office of the 
Attorney General, dedicated to providing the residents of western 
Massachusetts access to their State government. 



196 




SCOTT HARSHBARGER 

ATTORNEY GENERAL 



^o/Uorv. ^/Isd 02^08-^698 



No. 93/94-1 
August 9, 1993 

The Honorable Michael Joseph Connolly 
Secretary of the Commonwealth 
One Ashburton Place, 17th Floor 
Boston, MA 02108 

Dear Secretary Connolly: 

You have asked for my opinion whether section 64 of chapter 

110 of the Acts of 1993 may be the subject of a referendum 

petition under Article 48 of the Amendments to the 

Massachusetts Constitution. Your request arises because a 

referendum petition signed by more than ten qualified voters, 

calling for the repeal of section 64 and seeking its 

suspension, was filed with your office in timely fashion. 

Section 64, enacted as an "outside section" of the fiscal 1994 

general appropriation act, eliminates one of the two ways in 

which students may authorize fees to be assessed on tuition 

bills at state-operated colleges and universities to support 

nonpartisan student organizations that attempt to influence 

state legislation. For the reasons set forth below, I advise 

you that section 64 is a "law" subject to the referendum. 



197 



I. nnVERNING PROVISIONS OF AR TICLE 48 

My analysis must begin with the words of the Constitution 
itself. Article 48, Part I, provides, in pertinent part: 

Legislative power shall continue to be 
vested in the general court; but the people 
reserve to themselves . . . the popular 
referendum, which is the power of a 
specified niiinber of voters to submit laws, 
enacted by the general court, to the people 
for their ratification or rejection. 

Article 48, The Referendum, Part III, Section l, provides: 

"A referendum petition may ask for a referendum upon any law 

enacted by the general court which is not herein expressly 

excluded." Article 48 then provides: 

Excluded Matters . -- No law that 
relates to religion, religious practices or 
religious institutions; or to the 
appointment, qualification, tenure, removal 
or compensation of judges; or to the powers, 
creation or abolition of courts; or the 
operation of which is restricted to a 
particular town, city or other political 
division or to particular districts or 
localities of the commonwealth; or that 
annrnnriatps money fnr rhe current or 
ordinary expenses nf the commonwealth or for 
;:^nv of its depart m p-nrs. boards, commissions 
o^ institutions shall be the subject of a 
referendum petition. 

Art. 48, Ref., Ft. Ill, § 2 {emphasis added). Also, a separate 
portion of Article 48 excludes additional matters from the 
referendum, as follows: 

No proposition inconsistent with any 
one of the following rights of the 
individual, as at present declared m the 



198 



declaration of rights, shall be the subject 
of an initiative or referendum petition: 
The right to receive compensation for 
private property appropriated to public use; 
the right of access to and protection in 
courts of justice; the right of trial by- 
jury; protection from unreasonable search, 
unreasonable bail and the law martial; 
freedom of the press; freedom of speech; 
freedom of elections; and the right of 
peaceable assembly. 



Art. 48, Init. , Pt. II, § 2 



II. PROVISIONS OF THE MEASURE ON WHICH 
A REFERENDUM HAS BEEN REQUESTED 



Here, the provision as to which the referendum petition has 
been filed, section 64, merely eliminates one of the two ways 
in which students may authorize fees to be assessed on tuition 
bills at state-operated colleges and universities to support 
nonpartisan student organizations that attempt to influence 
state legislation. I therefore conclude that section 64 does 
not contain matters excluded from the referendum by either of 
the two provisions just quoted. i/ 



—'1 note that because the definition of "nonpartisan" in 
section 64 expressly excludes organizations "endorsing or 
adhering to particular . . . religious positions," section 64 
might be thought to implicate the provision of Article 48 
exempting law relating to religion from the referendum. Art. 
48, Ref., Pt. Ill, § 2. But the law that section 64 amends, 
G.L. c. 15A, § 29(a) (1992 ed. ) , already excludes such 
organizations, in language identical to that in section 64. 
Thus the enactment of section 64 did not alter, and the repeal 
of section 64 would not alter, the manner in which fees could 
be collected from students to fund such organizations. 

viewed in light of pre-existing law, section 64 does not 
(Footnote continued on next page.) 



The referendum provisions of Article 48 apply only to "laws 
enacted by the general court" within the meaning of Article 48, 
Part I, and Part II, Section 1. It is clear that section 64 
has been "enacted by the general court," as it was passed by 
the House and the Senate, and it has been approved by the 
Governor. See generally Alliance. AFSCME/SEIU. AFL-CIO v. 
flf^cretarv of Administration , 413 Mass. 377, 380, 382-83 (1992) 
(discussing meaning of phrase "enacted by the General Court" 
and concluding that it included gubernatorial action) . 

The remaining issue is whether section 64 is a "law" within 
the meaning of the referendum provisions of Article 48. There 
is no doubt that section 64 has the force of law, and section 
64 plainly meets the definition of "law" that the Supreme 
Judicial court has applied to the initiative provisions of 
Article 48. That is, section 64 "imports a general rule of 

(Footnote continued from previous page.) , k, 

relate distinctively to religion; it does not discriminate by 
reason of the religious views of the persons within its scope; 
and religion is not a factor m its application. £i. Collins 
V .q ^rrPfarv of ^v^^ Commonwealth , 407 Mass. 837, 851 (1990) 
(citing these three factors in interpreting scope of religious 
exclision in art. 48, Ref . , Pt. Ill, § 2). Unlike the law held 
tS be eSSluded from the referendum in Collins , section 64 does 
not "on Its face expressly purport [] to alter__the rights and 
nhi -iaarinns of reliqious institutions .... la. at o'iy 
(eiphasis added) ?here is thus no reason to think that public 
iisSSsion of section 64 would touch on religion m any way. 
?f CofuSs? a'l 47, 849 (noting that religious exclusion was 
St e nded to "avoid the consequences of permitting State-wide 
oSc political discussion of matters relating to religion"). 
?SSs seSion 64 is not excluded from the referendum by reason 
of its verbatim reenactment of existing law mentioning religion. 



200 



conduct with appropriate means for its enforcement declared by 
some authority possessing sovereign power over the subject . . 
. . " Associated Industries of Massachusetts v. Secretary of 
the Commonwealth . 413 Mass. 1, 10 (1992) . 

But section 64 was not enacted as a separate bill. Rather, 
it was enacted as an "outside section" of the fiscal 1994 
general appropriation bill enacted under the provisions of 
Article 63 of the Amendments to the Massachusetts 
Constitution. Section 64 is not one of the sections of the 
bill that appropriates money, as are sections 2, 2B, and 2C. 
Nor is section 64 a condition or restriction on an 
appropriation, as is, for example section 3 (specifying how 
local aid appropriated in line items in section 2 is to be 
distributed) . Instead, section 64 concerns a matter completely 
unrelated to Article 63 or state appropriations matters. Yet 
section 64 is attached to an appropriation bill that is 
excluded from the referendum because it "appropriates money for 
the current or ordinary expenses of the commonwealth . . . . " 
Art. 48, Ref . , Pt . Ill, § 2. The issue on which I must 
therefore advise you is whether section 64, as an unrelated 
outside section attached to an appropriation bill, may be 
treated as a "law" for purposes of the referendum. 

III. WHETHER AN OUTSIDE SECTION MAY BE TREATED AS A "LAW" 

The question whether an outside section of an appropriation 
bill may be treated as a "law" for purposes of the referendum 



201 



is a novel one. I begin by considering the precedents on 
related issues and the significance of the debates that led to 
the adoption of Article 63. I then consider recent Opinions of 
the Justices regarding the Governor's power to veto outside 
sections and recent decisions of the Supreme Judicial Court 
concerning the treatment of outside sections as "laws" under 
G.L. c. 29, § 7L {1992 ed. ) . I also discuss principles of 
interpretation applicable to Article 48. 

A. Precedents Concerning the Availability 
of a Referendum on a Part of a Law 

The general question whether a single section of a statute 
is subject to the referendum has been answered in the negative 
on numerous occasions, as has the related question whether a 
statute may be subject to the referendum where only some (but 
not all) of its sections address excluded matters.^/ Thus the 



2/see w;.rri v. Coletti . 383 Mass. 99, 106-08 (1981) (law 
extending life of and making appropriation for Ward Commission 
was excluded from referendum, because appropriation was a 
material part of law); PowpU v. Cole-Hersee Co., 26 Mass. App. 
Ct 532 535 (1988) (referendtun was not available on parts ot 
laws- because law reforming workers compensation system 
included section relating to powers of courts over workers 
compensation cases, and sections appropriating money for 
Department of Industrial Accidents, entire law was excluded) • 
1989-90 Op. Atty. Gen. No. 2, Rep. A.G., Pub. Doc No. 12 at 12 

(1989) (law amending G.L. c. 151B was excluded because two 
sections related to religion); 1982-83 Op. Atty. Gen. No. 4, 
lep A G , Pub. DOC No. 12 at 89 (1982) (law raising salaries 
of state officials was excluded because three sections related 
to compensation of judges); 1965-66 Op. Atty. Gen., Rep /.G., 
Pub. DOC No. 12 at 312, 313-14 (1966) (referendum was not 
available on individual sections of law, although law m its 
entirety was subject to referendum); VIII Op. Atty. Gen. 331, 

{Footnote continued on next page.) 



202 



Supreme Judicial Court has indicated, for example, that a 
statute establishing a program of accelerated highway and 
building construction was not subject to the referendum, 
because some of its sections appropriated money for the 
construction program. Yont v. Secretary of the Commonwealth . 
275 Mass. 365 (1931) . The court stated: 



The argument that the interpretation 
set forth here will enable the General Court 
to nullify the effect of art. 48 of the 
Amendments by tacking to any law an 
appropriation for a department cannot 
override the plain words of the Amendment . 
Moreover, it cannot be presumed that the 
legislative department of the government 
will be actuated by unworthy motives or 
enact laws as a cover for ulterior aims. 



Yont , 275 Mass. at 369. 

B. The Debates Preceding the Adoption of Article 48 

Similarly, the debates in the Constitutional Convention of 
1917-18, which led to the adoption of Article 48, contain 
indications that a referendum on part of a law was not to be 



(Footnote continued from previous page.) 

333-34 (1927) (referendum was not available on individual 
sections of law, and where one section of law was excluded 
because it related to powers of courts and applied only to a 
particular division of the Commonwealth, law in its entirety 
was excluded) . The 1989 Opinion of the Attorney General was 
effectively upheld in Collins v. Secretary of the Commonwealth . 
407 Mass. 837 (1990), although the court alluded only 
indirectly to the issue of whether a law is excluded from the 
referendum where only portions of the law address excluded 
matters. Id. at 851 n.lO. 



203 



permitted. The Convention recognized that the Legislature 
might enact "a law dealing with various subjects [,] and we may- 
wish to ask the people's advice simply on part of it and not on 
the whole of it." 2 Debates in the Constitutional Convention. 
1917-18 at 693-94 (1918) (remarks of Mr. Walker) . The 
Convention nevertheless rejected language that would have 
permitted a referendum not just on a law but on a "part 
thereof." 2 Debates at 693-702, 808-09, 901. 

The Convention's reasons for doing so are significant. The 
Convention heard fears expressed that if a referendum could be 
had on a part of a law, "the people [could] knock to pieces [a] 
law which has been carefully framed by the Legislature," i.^e^, 
a law "all of whose component parts are interrelated"; a 
"particularly interested group of people [could] pick out any 
one clause in the law and entirely destroy the whole purpose of 
Che law." 2 Debates at 694 (remarks of Mr. Bryant). It was 
considered "almost impossible for the voters to take a part of 
a law without the rest of the law before them and to decide 
intelligently whether that one particular part ought to come 
out"; to allow a referendum on a small part of a law which the 
uninformed "may not realize are vital to the whole purpose of 
the law" was seen as potentially destructive. Id. at 694-95. 

But the precise question presented here has never been 
answered: whether an outside section that is attached to an 
appropriation bill, but is unrelated to the appropriations in 
the remainder of the bill, is nevertheless insulated from the 



204 



referendum simply by virtue of having been enacted as an 
outside section rather than a discrete bill. The cases and 
opinions concluding that where one or more sections of a 
statute appropriated money, the entire statute was excluded 
from the referendum, all involved statutes for particular 
programs and appropriations for those same programs.—' None 
involved an unrelated outside section attached to an 
appropriation bill. 

The Debates are similarly silent on this issue. The same 
Constitutional Convention that produced Article 48 also 
produced Article 63, governing the appropriations process. But 
there was no recognition in the lengthy debates on either 
article that the Legislature might one day adopt the device of 
the "outside section" (a phrase apparently unknown at that 
time) to address, in an appropriation bill, dozens or hundreds 
of matters completely unrelated to appropriations. It was of 
course recognized in the Article 63 debates that an 
appropriation bill might contain many separate items of 
appropriation , and it was considered essential to give the 
Governor the power to reduce or veto individual items of 
appropriation in order to make the overall budget work. 3 
Debates at 1146, 1153, 1169 (1918) . 



^/see Ward . 383 Mass. at 106-08 (Ward Commission); Powell . 26 
Mass. App. Ct . at 535-36 (workers compensation system); Yont . 
275 Mass. at 370-71 (highway and building construction). 



But there was no discussion in the Article 63 debates of 
the possibility of unrelated outside sections of appropriation 
bills, and laws making appropriations for the Commonwealth were 
to be excluded from the referendiam entirely. For these two 
reasons, there was no discussion of whether the people should 
be given a special referendum power over unrelated parts of 
appropriation bills -- a power that might be said to correspond 
to the Governor's item veto. Thus, it cannot fairly be said 
that the Convention, in rejecting the proposal to make the 
referendum applicable to part of a law, resolved the question 
whether a referendiim could be had on an unrelated outside 
section in an appropriation bill.—/ 



C. Opinions of the Justices Concerning the 

Governor's Power to Veto Outside Sections 



The extensive use of outside sections began in 
approximately 1980, when the fiscal 1981 general appropriation 
act included a total of 134 sections. See St. 1980, c. 329 
(including reorganization of entire public higher education 



-'The court has stated that the Debates, while open for 
consideration, are "one avenue only for construing the words of 
the amendment 'in such way as to carry into effect what seems 
to be the reasonable purpose of the people in adopting [it] .' 
Raymer v. Tax Comm'r . 239 Mass. 410, 412 (1921) . This is 
particularly so where the language of the Debates is, by 
itself, less than dispositive of the issue." Buckley v. 
Secretary of the Commonwealth . 371 Mass. 195, 198-99 (1976) . 



206 



system in section 112) .— ' The fiscal 1982 general 
appropriation act included a total of 299 sections, see St. 
1981, c. 351; and the current year's general appropriation act, 
St. 1993, c. 110, included 390 sections before gubernatorial 
vetoes. For present purposes it is unnecessary to catalog the 
numbers of these sections that bear no relationship to 
appropriations matters. There can be no dispute that the 
number is substantial. 

The growth in the use of outside sections led almost 
immediately to controversy.—/ in 1981, after the Governor 
vetoed 77 outside sections of the fiscal 1982 general 



-'Interestingly, five years earlier, the fiscal 76 general 
appropriation act included, apparently for the first time, a 
large number of amendments to the General Laws. St. 19 75, c. 
684. Although the amendments were to various state tax laws 
and thus were arguably somewhat related to appropriations, the 
Governor appears to have been concerned that the statute (or 
perhaps the sections amending the General Laws) might be 
subject to the referendum. This may be seen from the 
Governor's decision to file an emergency statement with the 
Secretary of the Commonwealth to cause the statute to take 
effect immediately. See 1975 Acts and Resolves at 841-42; Art. 
48, Ref., Pt . 2 (providing that Governor may cause law to take 
effect immediately by filing emergency statement with 
Secretary) . The Legislature had provided that the statute 
should take effect upon passage, see St. 1975, c. 684, § 99, 
but, because the statute did not include an emergency preamble, 
this provision could operate only if the statute were not 
subject to the referendum, see Art. 48, Ref., Pt. 1, and so the 
Governor's decision to file an emergency statement suggests his 
view that, notwithstanding the exclusion of appropriation bills 
from the referendum, the statute or some part of it might in 
fact be subject to the referendum. 

—/As early as 1977, the Justices noted but did not decide "the 
question whether the Governor could disapprove general 
legislation attached as a 'rider' to an appropriation bill." 
Opinion of the Justices , 373 Mass. 911, 914 (1977) . 



207 



appropriation act discussed above, St. 1991, c. 351, the House 
sought an Opinion of the Justices concerning the Governor's 
power to use his item veto in this manner. Opinion of the 
Justices . 384 Mass. 820 (1981). Although counsel to the House 
took the position that the Governor had no such power, id. at 
821 n.l, the Justices disagreed. 

The Justices began by acknowledging that outside sections 
did not meet the accepted definition of "item" as a "separable 
fiscal unit," id- at 822, but the Justices stressed that 
Article 63 had been intended to create, and must be interpreted 
so as to preserve, a careful balance of powers between the 
Legislature and the Governor. Id. at 824. The Governor had 
been given the item veto in order to avoid "having to veto an 
entire bill merely on account of one item which does not meet 
his approval." Id. (quoting 3 Debates at 1146). The obvious 
problem with making the Governor's veto power applicable only 
to appropriation bills in their entirety is that such bills are 
often the most essential bills of the year. They must become 
law, or else state government grinds to a halt. To give the 
Governor the power only to veto the entire bill would have been 
to give him a power that for practical purposes could be used 
only in extraordinary circumstances, and this would have been 
inconsistent with the Governor's central and co-equal role xn 

the budget process. 

If the Legislature could insert in an appropriation bill 
provisions that the Governor could not veto without vetoing the 



entire bill, then the purpose of the item veto would be 
evaded. Id. at 825. Thus, notwithstanding that outside 
sections may not meet the definition of "item" as "separable 
fiscal unit," id. at 822, and while declining to express any 
view on "whether such separable provisions may properly be 
included in a budget bill in the first place," id. at 826. the 
Justices concluded that for the purposes of his item veto "the 
Governor may treat as an ' item' any separable provision 
attached to the general appropriation bill." Id. at 825. 
Otherwise, "general legislation included in a general 
appropriation bill would be rendered substantially 
veto-proof." Id.; see also Opinion of the Justices . 384 Mass. 
828, 832 (1981) (same) . 

Significantly, the Justices noted "that the inclusion of 
such a section raises the question whether such a section would 
be insulated from review by the people under the referendum 
provisions of art. 48." Id. It is worth noting that the 
Justices' Opinion was rendered only six months after the 
Supreme Judicial Court had decided that a statute extending the 
life of the Ward Commission was excluded from the referendum 
because it included a section appropriating money for the 
Commission. Ward v. Coletti . 383 Mass. 99 (1981). 
Notwithstanding Ward , however, the Justices evidently viewed 
the question whether a "separable" outside section was subject 
to referendum as one that was still open. 384 Mass. at 825. 



209 



In 1991 the Justices took two further steps to refine this 
analysis. O pinion of rhe Justices , 411 Mass. 1201 (1991). 
First, the Justices concluded that outside sections are est se 
separable from other portions of an appropriation bill, even in 
the case of an outside section that was closely related to two 
line item appropriations. Id. at 1213 (noting that section in 
question was "an outside section, which is separable," even 
though its veto rendered certain line items ineffective) . The 
Justices cited the 1981 Opinion discussed above as having 
"implied, if [it] did not expressly state, that any outside 
section in its entirety is a separable provision . . . . " Id. 

at 1207. 

Second, the Justices' analysis indicated that an outside 
section, although it could be vetoed in its entirety, was not 
really an "item"; instead, for gubernatorial veto purposes, an 
outside section was effectively like a separately enacted 
bill. The issue arose because the Justices had been asked for 
their opinion whether the Governor could veto a part of an 
outside section in the same manner as he could exercise his 
recognized Article 63 power to veto a part of an item. 411 
Mass. at 1215-16. In refusing to extend the analogy between 
items and outside sections this far, the Justices stressed that 
they "have never said, nor has the court, that an outside 
section is an item. It has only been said that an outside 
section may be treated as an item thereby preventing outside 



210 



sections from being veto-proof." Id. at 1216. The Justices 

continued: 

There would be no justification, let 
alone necessity, for treating part of an 
outside section as an item or part of an 
item. While treating an entire outside 
section as an item results in its being as 
susceptible to veto as an act or resolve not 
attached to an appropriation bill, such acts 
or resolves cannot be vetoed in part. See 
Part II, c. 1, § 1, art. 2, of the 
Massachusetts Constitution. Therefore, if 
the Governor were to have veto power over 
portions of outside sections, his veto power 
over general legislation in outside sections 
would exceed his veto power in the normal 
course. . . . [A] ssuming the propriety of 
outside sections, the Governor's veto power 
with respect to them ought not be greater 
than it would be if those sections had been 
separately enacted. 



411 Mass. at 1216. 

Because a part of an outside section cannot be treated like 
a part of an item ( i.e. . vetoed) , it thus appears that outside 
sections either are not items or cannot be treated as items for 
all purposes under Article 63. Rather, the Governor's power 
over outside sections is to be coextensive with his power over 
separate bills, as set forth in Part II, c. 1, § l, art. 2 of 
the Constitution. If outside sections are not subject to the 
same gubernatorial control as items, and instead are subject to 
the same gubernatorial control as separately enacted bills, 
then an outside section that has been approved by the Governor, 



211 



like a bill that has been approved by the Governor, becomes a 

7 / 
"law" as that term is used in Part II, c. 1, § l, art. 2.-/ 

D. Supreme Judicial Court Decisions 
Interpreting G.L. c. 2 9. ? 7L 

In a separate development that parallels the result reached 
in the 1991 Opinion discussed above, the Supreme Judicial Court 
has issued two recent decisions that have treated outside 
sections as separate "laws" for the purposes of G.L. c. 29, § 
7L (1992 ed.). That statute provides in pertinent part: "A 
law making an appropriation for expenses of the commonwealth 
shall not contain provisions on any other subject matter." 



^/The conclusion that outside sections are subject to the 
referendum has the effect of eliminating a recurring Article 48 
objection to the validity of such sections. My analysis here, 
of course, is grounded in the language and purposes of Article 
4 8 rather than on any secondary implications for other 
questions concerning outside sections. But one of the frequent 
objections leveled at outside sections is that they are 
inconsistent with the referendum provisions of Article 48. 
E.q Mitchell V- Secretary nf Admi nistration. 413 Mass. 330, 
337 '{1992) The challenge to the constitutional validity of 
outside sections remains unresolved. See Clean Harbors of 
Rraintree. Tnn.. v. Bn^rd of He ^^^h nf Braintree. 415 Mass. 
876 878-79 (1993); Mitchell . 413 Mass. at 336-37; Opinion of 
rhp' Justices , 411 Mass. at 1216; Town of Brookline v. The 
Governor , 4 07 Mass. 377, 382 (1990); Npw Rngland Memorial 
Hnsnital V. R^te Setti ng Commission, 394 Mass. 296, 303 n 9 
,Tr. ^.l\. n p..^.. nf th. Justi ces . 384 Mass. at 826 Regardless 
of whether outside sections are subject to the referendum the 
presumption that a statute is constitutional both in substance, 
e g., T.o^H n.Hrh V. Antonellis , 410 Mass. 568, 576 (1991), and 
iTfor^ir^r enactment, e^^, MnlPsworrh v. SPrrerary of th^ 
rnr.:.nnwealth . 347 Mass. 47, 50 (1964) , extends to outside 
sections. I simply note that the conclusion reached here may 
have some bearing on the unresolved question. 



In Gordon v. Sheriff of Suffolk County . 411 Mass. 238 
(1991), the court considered whether certain outside sections 
of the fiscal 1992 general appropriation act, St. 1991, c. 138, 
§§ 356-63, which transferred control over a house of correction 
from Suffolk County to the Conimonwealth, were invalid by reason 
of section 7L. Id. at 239. Although the general appropriation 
act of which these outside sections were a part was plainly 
" [a] law making an appropriation for expenses of the 
commonwealth, " the court took the challenged outside sections 
themselves, and not the appropriation act as a whole, as the 
relevant unit of analysis. Id. at 247-48. Because the 
transfer legislation set forth in the outside sections did not 
in and of itself make an appropriation for expenses of the 
Commonwealth, the court concluded that "§ 7L does not apply to 
the transfer legislation . . . ." Id. at 248. 

Only three weeks ago, in Clean Harbors of Braintree. Inc.. 
V. Board of Health of Braintree . 415 Mass. 876 (1993) , the 
court similarly treated a single outside section as a "law" for 
purposes of section 7L. The court reaffirmed the approach 
adopted in Gordon : "we read the requirements of § 7L as 
applying to the outside section rather than the appropriations 
act as a whole." Clean Harbors . 415 Mass. at 879. Because 
"the requirements of § 7L" apply only to "[a] law," the 



213 



conclusion is inescapable that for purposes of section 7L, an 

Q / 

outside section is a "law."-' 

E. Principles Governing the 

Interpretation of Article 48 

The treatment of outside sections as "laws" for purposes of 
the Governor's veto power and for purposes of G.L. c. 29, § 7L 
does not end the present inquiry. I must also consider whether 
treating outside sections as "laws" would be consistent with 
the purposes of Article 48. 

The Supreme Judicial Court has recently reaffirmed that 
Article 48 must be interpreted in accordance with its "general 
design and purpose," and that Article 48 "created a people's 
process . . . intended to provide both a check on legislative 
action and a means of circumventing an unresponsive General 
Court . " Citizens for a Competitive Massachusetts v. Secretary 
of the Commonwealth . 413 Mass. 25, 30 (1992) (internal 
quotations omitted) . The court thus rejected the argument that 
"the Legislature, by failing or refusing to comply with a 



i/Both in Gordon . 411 Mass. at 247, and Clean Harbors, 415 
Mass at 879, the court seemed to go out of its way to reach 
the result that an outside section is a "law" under section 
7L The court could have disposed of the section 7L claim in 
each case on what by now is the settled ground that one 
Legislature cannot bind another to exercise its appropriation 
power in any particular way. See, e.g., Associated Industries 
nf Massachusetts v. .qecretary of the Corranonwealth, 413 Mass. 1, 
9 (1992); Opinion of the Justices . 302 Mass. 605, 610-11 
(1939); Opinion of the Justices , 294 Mass. 616, 622 (1936). 



214 



mandatory provision of art. 48, [could] frustrate the right of 
the people to place a proposed law on the ballot." id. at 31. 
Similarly, when asked to interpret phrases in Article 48 
requiring the General Court to vote "upon the enactment of [a] 
law" and specifying the consequences if "the general court 
fails to enact such law, " the Justices have indicated that 
"unless the intended meaning of the words is plain from the 
context in which they are used, we must look to the purpose of 
the provision where they appear to determine their meaning. " 
Opinion of the Justices , 370 Mass. 869, 872 (1976).-^/ 

Here, the relevant language of Article 48 provides that 
"the people reserve to themselves . . . the popular referendum, 
which is the power of a specified number of voters to submit 
laws, enacted by the general court, to the people for their 
ratification or rejection." Art. 48, Pt . I. Article 48 
further provides: "A referendum petition may ask for a 
referendum upon any law enacted by the general court which is 
not herein expressly excluded." Art. 48, Ref., Pt . Ill, § 1. 
The obvious purpose of these broadly phrased provisions was to 
preserve a substantial measure of popular authority over laws 
enacted by the Legislature. 



-'The particular question before the Justices in that Opinion 
was the meaning of the word "enact" rather than the meaning of 
the word "law." 370 Mass. at 872. But the principle that each 
word of Article 48 must be interpreted in accordance with the 
purposes of the Article is just as applicable to the word "law" 
as to the word "enact". 



"A provision of the Constitution commonly is to be 
interpreted as stating a broad and general principle of 
government, regulative of all conditions arising in the future 
and falling within its terms." Opinion of the Justices . 251 
Mass. 523, 543-44 (1927); see also Opinion of the Justices . 386 
Mass. 1201, 1221 (1982); Opinion of the Justices . 308 Mass. 
601, 613 (1941) . Thus words and phrases in the Constitution 
were "not intended to be interpreted in any narrow or 
constricted sense." Opinion of the Justices . 297 Mass. 577, 
580 (1937); ?;pp Opinion of the Justices . 308 Mass. at 614. 

The Constitution of the Commonwealth was 
designed to be an enduring instrument so 
comprehensive and fundamental in its terms 
that a free, intelligent and virtuous people 
may govern themselves under its beneficent 
provisions through vast changes in social 
and industrial conditions. In construing 
its regulations regard must be had to their 
spirit and purpose as well as to their 
letter. The great and underlying principles 
announced by the Constitution and its 
Amendments must be kept in mind as well as 
possible narrow interpretations of 
particular phrases. 

Opinion of thP Justices . 291 Mass. 572, 575-76 (1935). 
Thus the word "law" as appearing in the referendum 
provisions of Article 48 is not to be construed in a narrow or 
technical sense. The extensive use of outside sections wholly 
unrelated to appropriations matters was not known to or 
discussed by the drafters of Articles 48 or 63. That the 
Debates evince an intention not to permit a referendum on a 
part of a law "all of whose component parts are interrelated," 



2 Debates at 694 (remarks of Mr. Bryant) , does not dispose of 
the unforeseen question, now presented, regarding an 
appropriation act containing multiple sections that are in no 
way interrelated. Accordingly, I conclude that the word used 
by the drafters -- "law" -- is broad enough to accommodate, and 
address the issues raised by, this relatively recent 
development in legislative procedure.—' 



IV. CONSIDERATIONS WEIGHING AGAINST 

TREATING AN OUTSIDE SECTION AS A LAW 



A number of considerations have been brought to my 
attention as possibly weighing against treating an outside 
section as a law for purposes of the referendum. I discuss 
these considerations in turn. 



A. Availability of an Initiative 
to Repeal an Outside Section 



The suggestion has been made that the right of the people 



ifl/ln Paisner v. Attorney General . 390 Mass. 593 (1983), the 
court stated that "not all legislative products are laws" and 
that statutes inserted in the General Laws that regulated the 
internal proceedings of the House or the Senate were, despite 
their form, legislative rules adopted by each house rather than 
"laws." Id. at 599, 601. The court thus held that an 
initiative petition proposing a statute that would purport to 
regulate the internal proceedings of each house did not propose 
a "law" within the meaning of Article 48. Id. at 603. For 
present purposes, Paisner is relevant because it indicates 
that, in determining whether a measure is a "law" for purposes 
of Article 48, the form of the measure is not necessarily 
controlling. 



to repeal an outside section through the initiative process is 
sufficient to satisfy the purposes of Article 48. Although the 
initiative may be used in this manner, I conclude for the 
reasons set forth below that it is at best an imperfect and 
inadequate substitute for the referendum. 

First, an initiative for a law requires more than twice as 
many signatures of registered voters for submission to the 
people than does the referendum. i^/ Second, the initiative 
process may be considerably slower, requiring up to three years 
and four months (more than eight times as long as is possible 
through a referendum) before the measure is submitted to the 
people. iS./ Third, the initiative process contains no method 



ii/An initiative for a law requires: (1) a number of 
signatures equal to three percent of the entire vote cast for 
Governor at the preceding state election, m order to be 
introduced into the Legislature, art. 48, Init., Pt . V, § 1; 
and (2) if the measure is not enacted by the Legislature, an 
additional number of signatures equal to one half of one 
nercent of the entire vote cast for Governor at the preceding 
state election, in order to be submitted to the people Id. A 
referendum petition requires a number of signatures equal to 
only one and one half percent of the entire vote cast for 
Governor at the preceding state election. .Art. 48 Ref., Pt . 
TIT 5 4 If the petitioners seek suspension of the law 
pending the referendum, the number is two (rather than one and 
one half) percent of the entire vote cast for Governor at the 
preceding state election. Art. 48, Ref., Pt . Ill, § 3. 

i2/A portion of a law enacted by the Legislature immediately 
after the first Wednesday in August of a year m which there is 
So statewide election (elg^, 1993) could not be placed before 
SevoteS for repeal bFi^itiative petition until the second 
succeeding statewide election, three years and four months 

(app^oximltely 1215 days) later (e^, m November of 1996) . 
in contrast, a referendum is available at any statewide 
election so long as a completed referendum petition is filed 
with your office more than sixty days before the election. 

(Footnote continued on next page.) 



218 



for suspending the effect of an existing law, as does the 
referendum process. See Art. 48, Ref., Pt . Ill, § 3. Thus a 
law that the people may wish to repeal promptly nevertheless 
remains in effect for several years. Finally, although the 
drafters of Article 48 understood that the initiative could be 
used to achieve results similar to the referendum, 2 Debates at 
702 (remarks of Mr. Churchill) , it seems clear that if the 
drafters had viewed the initiative as a fully adequate 
substitute for the referendum, they would not have provided for 
a referendum at all. I conclude that the possibility of 
repealing an outside section through an initiative is not a 
sufficient basis for barring a referendum on an outside section. 

B. Uniform Treatment of Appropriation Bills and 
Non- Appropriation Bills Under Article 48 

I next consider the point that even laws that do not make 
appropriations may well include separate sections addressing 
wholly unrelated matters. The significance of this point is 
that, under the authorities discussed earlier in this opinion, 
if one section of a law is excluded from the referendum, the 



(Footnote continued from previous page.) 

Art. 48, Ref., Pt . Ill, §§ 3, 4. Even if the referendum 
petitioners do not file the completed petition until ninety 
days (the maximum allowable) after the provision in question 
has become law, the result is that a provision that becomes law 
as little as approximately 150 days before a statewide election 
may be submitted to the people through a referendum at that 
election. 



entire law is excluded. If the drafters of article 48 were 
willing to limit the referendum in this manner as to laws not 
making appropriations, the argument goes, there is no reason to 
think that they would not tolerate the same result as to laws 
that do make appropriations. 

The short answer is that the members of the Convention that 
drafted both Articles 48 and 63 were agreed on the "fundamental 
point [] . . . that appropriation bills are by their nature 
unique . . . ." Opinion of the Justices , 384 Mass. 820, 823-24 
(1981) . As noted, appropriation bills are bills the passage of 
which is absolutely essential, and thus they are bills that 
present special problems. Matters may be attached to 
appropriation bills that are not items of appropriation and 
might not be approved in the same form if offered as separate 
bills. Thus the Justices have concluded that the Governor's 
veto power must extend to individual outside sections. Id. ; 
see also OsiniQiL_Qf__the_Justices, 411 Mass. 1201, 1216 (1991). 
Just as the Constitution could not tolerate a system under 
which "general legislation included in a general appropriation 
bill would be rendered substantially veto-proof," Opinion of 
the Justices . 384 Mass. at 825, so is it undesirable to 
interpret the Constitution in a manner that would render such 
legislation completely ref erendum- proof . 

I recognize that in Article 63 the drafters gave the 
Governor the express power to veto parts of bills, whereas the 
drafters did not expressly give the analogous power to the 



people under Article 48. But there is no reason to conclude 
that the referendum may apply to an outside section only if a 
precise analogy is possible between the referendum power, as a 
check on legislative action, and the check on legislative 
action represented by the Governor's item veto power. The more 
appropriate analogy, to the extent such analogies are useful, 
would be between the referendum and the Governor's "unitary 
veto" power under Mass. Const. Pt . II, c. 1, § 1, art. 2, i.e. . 
his power to veto separate bills in their entirety. 

This is because, as the Justices' most recent Opinion 
plainly indicates, the limits on the Governor's power to veto 
outside sections are not those applicable to his item veto but 
instead are the same as those on his unitary veto power. 411 
Mass. at 1216. The Justices may thus be of the view that when 
the Governor vetoes an outside section, he exercises his 
unitary rather than his item veto power. Regardless of the 
exact textual source of the Governor's power to veto outside 
sections, however, the point here is that the absence of a 
perfect analogy between the people's Article 48 referendum 
power and the Governor's Article 63 item veto power is not 
controlling as to the extent of the referendum. There has been 
no suggestion that the referendum power extends to parts of 
items, as does the item veto power. My conclusion here is only 
that unrelated outside sections, which are essentially treated 
as separate bills for the purposes of gubernatorial vetoes. 



221 



are, if approved by the Governor, to be treated as laws for the 
purposes of the referendum. 

C. Presumption of Constitutionality Indicating 

that Section 64 is Not Subject to the Referendum 

I now turn to the suggestion that there is a presumption, 
binding on executive officials such as the Secretary and the 
Attorney General, that section 64 is not subject to the 
referendum. The presumption is said to grow out of the 
circumstance that the general appropriation act to which 
section 64 is attached, although not approved by the Governor 
until July 19, 1993, includes a section stating that, except as 
otherwise provided in the act, the provisions of the act are to 
take effect as of July l, 1993. See St. 1993, c. 110, § 390. 
Laws that are subject to the referendum, however, may not take 
effect earlier than ninety days after having become law, unless 
declared to be emergency laws. Art . 4 8, Ref . , Pt . I . No part 
of St. 1993, c. 110 has been declared to be an emergency law, 
yet the Legislature has provided in section 390, that St. 1993, 
c. 110 is, except as otherwise provided therein, to take effect 
sooner than ninety days after becoming law. It is said that 
section 390 could be constitutional only if the sections to 
which it applies (including section 64, which includes no 
separate effective date) are not subject to the referendum. 
Because any duly- enacted statute is presumed constitutional, 
e.g. . T.^mnvich V. Antonellis . 410 Mass. 568, 576 (1991), the 
presumption of constitutionality attaching to section 390 is 



222 



said to indicate (unless and until a court determines 
otherwise) that section 64 is not subject to the referendum. 

The flaw in this approach is more easily seen by assuming 
that, instead of expressing its view indirectly through means 
of an effective date provision, the Legislature had included in 
a law a section explicitly stating that the law was not subject 
to the referendum. If a referend\im petition filed by ten 
qualified voters were then filed with you as Secretary, the 
Legislature's statement could not bar you from making your own 
independent determination, and from seeking my opinion as 
Attorney General, regarding whether the law in question was 
excluded from the referendum. Your duty to make this 
determination would arise directly out of Article 48, as would 
my duty to determine whether to prepare a "fair, concise 
summary" of the law for use on the blank petitions and on the 
ballot. Art. 48, Ref . , Pt. Ill, §§ 3, 4; Art. 48, Gen. Prov. , 
Pt . Ill; see , e.g. . Yont v. Secretary of the Commonwealth . 275 
Mass. 3 65, 3 72 (19 31) (holding that where a law was excluded 
from referendum, petitioners had no right to demand that 
Secretary issue blank petitions for subsequent signers) . 

A power that "derives from the Constitution" -- here, your 
power as Secretary and my power as Attorney General to 
determine for the purposes of performing our constitutional 
duties whether a matter is excluded from the referendum -- 
"cannot be abrogated by legislation." Alliance. AFSCME/SEIU, 
AFL-CIO v. Secretary of Administration . 413 Mass. 377, 383 n.9 



223 



(1992) . For the Legislature to provide either directly or 
indirectly that a particular bill is not subject to the 
referendum would be tantamount to an attempt to add, by 
statute, to the list of excluded matters set forth in Article 
48. I decline to impute to the Legislature any such intention. 
This is in no way to say that the views of the Legislature 
on whether a particular law is subject to the referendum are 
irrelevant. To the contrary, the views of the Legislature are 
entitled to the most respectful consideration. See, e^^g^, 
Murray v. Secretary of the Commonwealth , 345 Mass. 23, 25 
(1962) (discussing Legislature's choice of effective dates and 
attachment of emergency preambles as indicative of 
Legislature's view on applicability of referendum); see also 
W;^rri V. Coletti , 383 Mass. 99, 108 (1981) (similar). It is 
entirely appropriate for the Legislature to specify effective 
dates or attach emergency preambles according to its view of 
whether a particular law is subject to the referendum. 

Here, the Legislature may well have been of the view that 
no part of St. 1993, c. 110, the act containing section 64, was 
subject to the referendum. I recognize that there is 
considerable basis in past precedent that would lend support to 
that view. But the precise question you have posed here is a 
novel one, and, in advising you on that question, it is my duty 
to consider the recent developments in case law and the 
Opinions of the Justices discussed above. I therefore conclude 
than the effective date provision in St. 1993, c. 110, § 390, 



224 



and the absence of an emergency preamble to that statute, do 
not bar the exercise of independent judgment on whether section 
64 is subject to the referendum. 

D. Practical Implications of 

A Referendiim on an Outside Section 

The conclusion that an outside section is subject to the 
referendum raises certain practical implications, which I now 
address. In my judgment, these considerations furnish no basis 
for reaching the opposite conclusion. 

First, it may be questioned whether a referendum is 
available on any outside section not otherwise excluded, or 
instead is limited to those sections that do not bear some 
close relationship to the appropriation act itself. An outside 
section that itself appropriated money within the meaning of 
the referendum provisions of Article 48, or that imposed a 
condition or restriction on such an appropriation made 
elsewhere, would of course be excluded. See art. 48, Ref., Pt. 
Ill, § 2.—/ An outside section that did not make, condition. 



—'This is because to repeal the condition or restriction would 
be to alter the purposes for which the appropriated funds could 
be spent, thus effectively making an appropriation, or at a 
minimum interfering with the legislative power of 
appropriation. Cf. Opinion of the Justices , 384 Mass. 828, 
837-38 (19 81) (concluding that to permit Governor to veto 
restrictions on use of appropriated funds would interfere with 
legislative power of appropriation) ; Attorney General v. Chief 
Administrative Justice of the Boston Municipal Court Department 
of the Trial Court , 384 Mass. 511, 515-17 (1981) (concluding 
that veto of line item language that did not condition or 
restrict expenditure of appropriated funds did not "enlarge the 
(Footnote continued on next page.) 



225 



or restrict an appropriation, however, but that closely related 
to an item of appropriation, would present a different 

14/ 
question. ^-^' 

Here, however, section 64 is not related to appropriations 
in any way. Therefore, I merely note and do not express any 
opinion on whether an outside section that closely relates to 
an excluded appropriation, but does not make, condition, or 
restrict such an appropriation, would nevertheless be excluded 
from the referendum. There is no reason to think that the 
question, if presented, could not be answered according to a 
standard that would be both workable and consistent with the 
language and purposes of Article 48. 



(Footnote continued from previous page.) 

appropriations made by the Legislature" and was therefore 
permissible) . See also Massachu setts Coalition for the 
Homeless v. Secretary of Human Services , 400 Mass. 806, 817 
n.lO (1987) (suggesting that in determining for purposes of 
G.L. c. 29, § 7L whether a law contained provisions on a 
subject matter other than appropriation, test might be same as 
that used to determine validity of gubernatorial item vetoes) . 

14./The court has recognized that outside sections may be 
"sufficiently related to the subject of appropriation of funds" 
so as to make it unnecessary to decide the recurring question 
whether an outside section unrelated to appropriations may be 
included in an appropriation act. Mitchell v. Secretary of 
Administration . 413 Mass. 330, 337 (1992) (citing Brooklme v. 
Thfq Governor . 407 Mass. 377, 382, 384 (1990)). At the same 
time, the Justices have treated outside sections as separable 
per se from the line items of an appropriation act, even where 
the Governor's veto of an outside section results in related 
appropriation items being rendered ineffective. Opinion of the 
Justices . 411 Mass. at 1206, 1213. 



Second, I note that an outside section that is subject to 
the referendum may not take effect earlier than ninety days 
after having become law, unless declared to be an emergency 
law. Art. 48, Ref., Pt. I. The Legislature, however, is 
accustomed to providing that different sections of 
appropriation acts will take effect at different times. See . 
e.Q. . St. 1992, c. 133, §§ 595-99 (provisions of fiscal 1993 
general appropriation act, specifying various effective dates 
for particular outside sections of act) . And where it is 
deemed necessary to make an outside section effective 
immediately, the Legislature may do so by attaching an 
emergency preamble or the Governor may do so by filing an 



emergency statement. Art. 48, Ref., Pt . II 
V. CONCLUSION 



15/ 



I conclude by acknowledging that my advice to you on the 
novel question presented here, based as it is upon recent 
developments in caselaw and advisory opinions as well as on the 
language and purposes of Article 48, is not entirely free from 
doubt. Nevertheless, it is my duty to furnish you with a 



— /l also note the question whether the treatment of an outside 
section as a separate bill for purposes of the referendum 
implies that the Governor may return an outside section to the 
Legislature with suggestions for amendment pursuant to Article 
56 of the Amendments to the Constitution. There is no occasion 
for me to express any view on this issue. The question was 
presented to but not resolved by the Justices in 1989. Answer 
of the Justices , 406 Mass. 1220 (1989) . 



definite answer to your question in accordance with my best 
legal judgment. See generally G.L. c. 12, § 3 (1992 ed.). 
Moreover, by unbroken tradition dating from the very first year 
after Article 48 was ratified by the people, my predecessors as 
Attorney General have advised your predecessors as Secretary 
regarding the proper interpretation of the referendum 
provisions of that Article. E.g. , V Op. Atty. Gen. 400 
(1919). Therefore, I advise you that, in my judgment, section 
64 is subject to the referendum. 

It has been suggested that because the issue is a novel one 
and a prompt and authoritative judicial determination of the 
issue is desirable, the wiser course would be for me to advise 
you in a manner that is calculated to bring about such a 
determination by provoking a test case. Thus it has been 
suggested that I should advise you that section 64 is not 
svibjecc to the referendum, confident that the first ten signers 
of the referendum petition would immediately bring a court 
action challenging this conclusion. Although I concur that a 
judicial determination is desirable, I do not agree that I 
should attempt to bring about such a determination by rendering 
an opinion that is contrary to my considered judgment on the 
merits of the question presented. Nor would it be appropriate 
to put the signers of the referendum petition to the trouble, 
expense, and delay of filing a lawsuit to vindicate what, in my 



judgment as Attorney General, are their rights under Article 
48.1^/ 

Under the Constitution, either branch of the Legislature or 
the Governor may request an Opinion of the Justices, and there 
is no reason why such an Opinion could not be sought in a 
manner that would result in clarification of the issue 
presented here. See Mass. Const. Pt . II, c. 3, art. 2; see 
also Answer of the Justices . 406 Mass. 1220, 1225-26 (1989) . 
But the Constitution confers no such authority on the Attorney 
General. I have therefore proceeded to express my conclusions, 
and to set forth my underlying reasoning in considerable 
detail, in order to fulfill my obligation to advise you in the 
most helpful manner possible pending further clarification from 
the courts or the Justices. 

In sum, I advise you that section 64 of chapter 110 of the 
acts of 1993 may be the subject of a referendum petition. In 



iS./l have not hesitated to defend the Legislature when its 
actions under Article 48 are directly called into question. 
LIMITS V. President of the Senate , 414 Mass. 31 (1992). I have 
also defended the legislative practice of enacting outside 
sections unrelated to appropriations against challenges under 
Articles 48 and 63. Clean Harbors of Braintree. Inc.. v. Board 
of Health of Braintree . 415 Mass. 876 (1993) ( amicus brief). 
Here, however, my role is different: to advise you based on my 
own judgment as to what Article 48 requires. 



229 



accordance with your further request, I enclose a fair, concise 
summary of section 64. 



Enc, 




arshbarger 



230 



SUMMARY OF SECTION 64 OF 
CHAPTER 110 OF THE ACTS OF 199 3 



This law eliminates one of the two ways in which students 
may authorize fees to be assessed on tuition bills at 
state -operated colleges and universities to support nonpartisan 
student organizations that attempt to influence state 
legislation. 

The law applies to community and state colleges and the 
University of Massachusetts. The law takes the place of 
previous law that allowed a student body, by a majority vote in 
an official student body referend\im, to authorize a "waivable 
fee, " or (at state colleges and the University) an "optional 
fee, " to be collected for such nonpartisan student 
organizations. Under this law, the boards of trustees at 
community and state colleges and the University are prohibited 
from collecting waivable fees and may only collect optional 
fees for such organizations. 

A "waivable fee" is collected when authorized by a majority 
of those students voting in an official student body 
referendum. A waivable fee is an amount payable on a tuition 
bill, appearing as a separately assessed item and accompanied 
by a statement that the fee is not a charge required to be paid 
by the student but rather that the student may deduct the 
charge from the total amount due. The tuition bill also 
explains the nature of the fee and states that the fee appears 
on the bill at the request of the student body and does not 
necessarily reflect the endorsement of the board of trustees. 



An "optional fee" is collected when authorized by a 
majority of those students voting in an official student body 
referendum. An optional fee is an amount payable on a tuition 
bill, appearing as a separately assessed item and accompanied 
by a statement that the fee is not a charge required to be paid 
by the student but rather that the student may add the charge 
to the total amount due. The tuition bill also explains the 
nature of the fee and states that the fee appears on the bill 
at the request of the student body and does not necessarily 
reflect the endorsement of the board of trustees. 




SCOTT HARSHBARGER 
ATTORNEY GENERAL 



^ne^JDorn/7zoriuse€tu/Lc^,^y^aAAacAuAe^ 



No. 93/94-2 

August 25, 199 3 

Douglas McDonald, Executive Director 
Massachusetts Water Resources Authority 
Charlestown Navy Yard 
100 First Avenue 
Boston, MA 02129 

Dear Mr. McDonald: 

You have requested my opinion regarding the proper 

interpretation of St. 1991, c. 41, "An Act Relative to the 

Transfer of Certain Commonwealth Land in the Town of Walpole to 

the Massachusetts Water Resources Authority." Specifically, 

you ask whether the statute would cause the specified land in 

the Town of Walpole to revert to the Commonwealth if the 

Massachusetts Water Resources Authority (MWRA) chose not to 

develop the land for use as a landfill but instead chose to 

leave the land in an undeveloped state as a back-up site for 

use as a landfill if necessary in the future. Your request 

arises because, as part of the Boston harbor clean-up 

litigation, United States v. Metropolitan District Commission . 

No. 85-0489-MA (D. Mass.), the MWRA is seeking federal court 

approval for the use of a commercial landfill to dispose of 

certain sewage treatment by-products, but the MWRA needs to 

know whether the Walpole land would remain available in the 



event that commercial disposal becomes impossible. For the 
reasons set forth below, I conclude that the Walpole land would 
not so revert but could continue to be held by the MWRA in its 
undeveloped state for this purpose. i/ 

Chapter 41 directs that certain land located in Walpole and 
owned by the Commonwealth be transferred by deed to the MWRA 
"for the public purpose of providing a landfill site, unless an 
alternative site is developed and approved by the Federal 
District Court, for disposal of grit, screenings, and, if 
necessary, sludge or sludge products from metropolitan Boston 
sewerage treatment facilities." Id. § 1. Section 3 of chapter 
41 provides: 

Said transferred land, if developed by 
the MWRA may be used only for the purposes 
of construction, operation, and maintenance 
of a landfill for grits [sic] and screenings 
from metropolitan Boston sewerage treatment 
facilities and as a back up site for the 
disposal of sludge or sludge products from 
said facilities if the MWRA proposed sludge 
pelletizing plant becomes non- operational or 
if the MWRA is unable to fully market the 
fertilizer pellets produced by said 
facilities or otherwise dispose of such 
pellets for beneficial reuse or land 
application. Such transferred land shall 
not be used for any other purpose including 



i/My opinion is rendered pursuant to St. 1984, c 372 § 24 
which authorizes the Attorney General to appear for the MWRA 
actions involving water pollution to the same extent as the 
Attorney General appears for state agencies pursuant to G.L. 
12 § 3 (1992 ed ) The authority to represent the MWRA in 
oarticular cases includes by implication the authority to 
render opinions on issues related to those cases. 



234 



but not limited to disposal of grit, 
screenings, sludge or other waste products 
from any source or project other than as 
provided in this act. If the transferred 
land ceases to be used for the purposes 
authorized herein, all right, title and 
interest in such transferred land shall 
revert to the commonwealth. 



Section 3 thus provides that the land, "if developed by the 
MWRA[,] may be used only for" certain specified purposes, and 
that if the land "ceases to be used for the purposes authorized 
herein, " the land will revert to the Commonwealth. But section 
3 clearly contemplates that the land might never be developed 
by the MWRA at all. It is only "if" the land is developed that 
it must be "used" for one or more of the purposes specified in 
section 3. 

Moreover, the land will revert only if it "ceases" to be 
"used" for the authorized purposes. If the land is never 
"used" for any purpose, then it will never "cease" to be "used" 
for an authorized purpose, and thus the reversion clause will 
not be triggered. Had the Legislature provided for reversion 
in the event the land "fails" to be used for the specified 
purposes, there is no question that the MWRA could not hold the 
land in an undeveloped state for an extended period. But 
"cease" means something quite different than "fail." "Cease" 
means "that something has existed and then has stopped, that 
is, has ceased to exist." Pacheco v. Lachapelle . 163 A. 2d 38, 
40 (R.I. 1960). The word "applies 'to that which is thought of 
as being .... One cannot 'stop' or 'cease' doing a thing 



unless he is doing it at the time. There must be a beginning 
and a continuance before an end." Bradner v. Vasquez . 227 P. 2d 
559, 561, 102 Cal. App. 2d 338 {Cal. Dist . Ct . App. 1951) 
{internal citations and quotations omitted) . 

Thus in Jordan v. Haskell . 63 Me. 189 (1875) , the Maine 
Supreme Judicial Court considered a statute providing that land 
taken for the construction of a schoolhouse would revert to the 
original owner if a schoolhouse "ceased to be thereon" for two 
years. The court held that where no schoolhouse had been 
constructed within two years of the taking, the statute did not 
cause the land to revert. Id. at 192. "Here the [school] 
house has not ceased to be, nor begun to be, thereon. There 
must be the beginning before the end. This provision was 
intended to apply to an occupancy once had and abandoned. Any 
other construction might result in wholly preventing locations 
for school house purposes, " because there might be legitimate 
reasons for not building a school house in the two years after 
land was taken for the purpose. Id . 

Similarly, in Nicomen Boom Co. v. North Shore Boom & 
Driving Co . . 82 P. 412 (Wash. 1905), app. dismissed . 205 U.S. 
548 (1907), 212 U.S. 406 (1909), the Washington Supreme Court 
considered a statute providing that property taken for the 
construction and maintenance of a log boom would revert to the 
original owner whenever use of the property for a log boom 
"shall cease for a period of one year." 82 P. at 416. The 
court held that where the property taken was not actually used 



236 



for a log boom within a year after the taking, the statute did 
not cause the property to revert : 



The reason for the provision seems to be that, if the 
land has once been applied to the intended use, and 
that use ceases for a year, it shall be presumed that 
the necessity for its use no longer exists, and the 
landowner shall then be entitled to re-enter and 
occupy it. We do not think the statute applies to 
lands located with reference to future needs, the 
actual necessity for the use of which has not yet 
arisen, but which necessity may reasonably be 
anticipated. 



Id. 

Here, apart from the use of the phrase "ceases to be used," 
other provisions of chapter 41 are consistent with the 
interpretation that the land will not automatically revert if 
held by the MWRA in an undeveloped state. For example, section 
1 directs (with emphasis added) that the land be transferred 
"for the public purpose of providing a landfill site . " rather 
than for the narrower purpose of providing a landfill 
itself.—' Indeed, providing a "site" could be viewed as one of 
the "purposes authorized" by chapter 41, such that as long as 
the land is held as a site for the purpose of providing a 



-/Section 1 provides that the land is to be transferred for the 
purpose of providing such a site "unless an alternative site is 
developed and approved by the Federal District Court . . . . " 
This language creates a condition the satisfaction of which 
would have halted the original transfer of the land (now 
completed) from the Commonwealth to the MWRA. It is not a 
condition the post- transfer satisfaction of which would cause a 
reversion. 



landfill in the future, it has not "cease [d] to be used for the 
purposes authorized herein" within the meaning of the reversion 
clause of section 3. 

In addition, section 4 provides that the transfer is 
subject to an easement to permit the Department of 
Environmental Protection (DEP) to inspect "any landfill 
constructed on the premises" and "any material being deposited 
therein . . . . " Section 6 directs DEP to install wells to 
provide warning of any release of leachate into the groundwater 
"under and about the proposed facility." Section 13 requires 
the MWRA to provide "mitigation to the property owners abutting 
the site of the potential residuals landfill . . . . " And 
section 14 requires the MWRA to pay a flat annual fee to the 
Towns of Walpole and Norfolk "as long as the landfill is in 
operation." These provisions all demonstrate the Legislature's 
recognition that the landfill might never be constructed. Had 
the Legislature intended the absence of construction to lead to 
a reversion, presumably the Legislature would have said so in 
language at least as direct as the provisions just quoted. 

In a similar vein, section 7 provides that "[i]n the event 
of a reversion, MWRA shall be obligated to take all action 
necessary to return the transferred land to a safe condition . 
. . . " This language appears to envision a reversion occurring 
after the MWRA has undertaken some activity that has 
transformed the land in some way. Although not necessarily 
inconsistent with a reversion of undeveloped land, the language 



does suggest that the Legislature's primary, if not exclusive, 
focus was on a reversion triggered by unauthorized activity, 
the effects of which would have to be undone, rather than a 
reversion triggered by inactivity. 

It is also worth noting that although chapter 41 was 
approved by the Governor on May 20, 1991, and an emergency 
declaration was filed on May 21, 1991, section 9 prohibits the 
MWRA from commencing construction prior to September 1, 1992, 
unless certain conditions are met. And section 10 directs the 
MWRA to establish, "at least ninety days prior to the operation 
of the landfill facility, " a program to require member 
communities to accept sludge pellets. The Legislature thus 
envisioned that the land would lie undeveloped for at least a 
period of fifteen months, and that certain other contingencies 
would have to be met well in advance of any landfill being 
operated. Yet clearly the Legislature did not intend this 
initial period of non-use as a landfill to trigger the 
reversion clause. 

If the Legislature had intended the land to revert unless 
construction commenced or the site began to be used as a 
landfill by some definite time after September 1, 1992, or even 
within a reasonable period after that date, presumably the 
Legislature would have said so. Cf . section 13 (requiring MWRA 
to provide mitigation to abutters "within a reasonable time"). 
In other words, having recognized an initial period of 
permissible inactivity, the Legislature would have placed some 



239 



outer limit on that period had it intended subsequent 
inactivity to result in reversion. Yet no such limit appears 
anywhere in chapter 41. 

Chapter 41 expressly recognizes that one of the permissible 
uses of the land is "as a back up site for the disposal of 
sludge or sludge products if the MWRA proposed sludge 
pelletizing plant becomes non- operational" or if certain other 
contingencies occur. These contingencies are by no means 
certain to occur either immediately or not at all. For 
example, for the "proposed" sludge pelletizing plant to first 
become operational and then become non- operational might not 
occur until some point well into the future. And it could 
hardly be that the Legislature intended to forbid the MWRA from 
keeping the land as a back-up site for sludge disposal unless 
the MWRA had first commenced using the site as a landfill for 
grit and screenings. The fact that the need for a back-up site 
for sludge disposal might not become pressing until some point 
in the future supports the conclusion that holding the land 
undeveloped will not cause it to revert to the Commonwealth. 

Although the language of the statute is sufficiently clear 
that there may be no need to consider extrinsic factors, I note 
that the circumstances leading to the enactment of chapter 41 
support my conclusion. Chapter 41 was a direct response to a 
federal court order banning sewer hook-ups emptying into Boston 
Harbor until such time as the MWRA was given the power to 
acquire a suitable landfill site. See United States v. 



Metropolitan District Commission . 930 F.2d 132 (1st Cir. 1991) 
(upholding ban) . The Legislature enacted chapter 41 not 
because it was particularly anxious for the MWRA to construct a 
landfill in Walpole but because it was essential at that time 
to give the ^4WRA the means and authority to construct such a 
landfill. 

Thus there is no indication of any legislative intent to 
preclude the MWRA from seeking alternative means of disposal 
that would make actual construction in Walpole unnecessary. 
Nor is there any reason to believe that the Legislature 
intended to require the MWRA immediately to construct a 
landfill in Walpole, even though its use might prove 
unnecessary, simply in order to prevent the site from 
reverting. So long as there remains a potential need for a 
landfill in Walpole, and so long as the site is not used for 
any purpose prohibited by chapter 41, it serves the purposes of 
chapter 41 for the MWRA to retain ownership of the site in an 
undeveloped state. 

Accordingly, I conclude that the MWRA may hold the land in 
an undeveloped state for the purpose of providing a back-up 
landfill site without causing the land to revert to the 
Commonwealth by operation of chapter 41. 




241