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Whom Do You Pay First When Cash Gets Tight ?

This region and its business community are facing some frightening times. Energy prices are at record highs, which not only affect what we pay at the pump, but push up prices on most goods, as transportation and other costs increase. Furthermore, consumers are unwilling or unable to spend as they have in the past due to these perceived price increases.

As a result, many businesses are experiencing cash-flow problems that they have not experienced for many years and are struggling with how to keep current. Here is some practical advice on how to maneuver through these challenging times.

When the inevitable cash crunch hits, are you prepared for it, and what will you do?

The first thing that needs to be dealt with in order to prevent a crisis is a complete review of your company’s budget to determine any areas where there may be some fat or other reasons to curtail expenses. This is a difficult decision because certain expenses that appear discretionary, such as promotional and advertising costs, may be quite essential to keeping a business going in order to get to a turnaround.

A more difficult decision involves personnel costs. These are usually the highest expenses in a business, exclusive of inventory. Cutting back on personnel sends a message to the community — and, more importantly, to your employees — that things are not going well. This could have a deleterious effect on your organization. Therefore, it is important at some point to communicate, with at least the key employees, as to what the situation is with your business and to elicit their help and support during difficult times.

Once you are satisfied that the budget is in proper form and reasonable, how do you ride out the storm?

In almost every business, a substantial amount of the expenses are compensation-related items such as health care and payroll taxes. Certainly the payroll and related costs must be paid in a timely manner in order to maintain the normal business operation. Taxes, including payroll taxes, sales taxes, and others, are not necessarily due on a weekly basis, and if these payments slip, the usual business operations can appear unaffected for a relatively indefinite period of time. For this reason, there is a great temptation on the part of many business owners to use these funds for temporary working capital.

This is probably one of the worst mistakes you can make. Not only do these overdue taxes result in exorbitant interest charges and penalties, but in the event of a disastrous result, such as liquidation of your business, they do not enjoy a priority over that of secured creditors, and if they remain unpaid, they become the personal obligation of the principals of the business.

In most cases they can never be discharged, even in individual bankruptcies. Therefore, it is not in your best interest to use these funds as working capital. You should assiduously make these payments so they do not come back to bite you. Do not give in to the temptation to delay on these items.

Other substantial costs are likely to be loan payments to secured creditors. Typically, secured creditors are banks, and they are secured by liens on substantially all the assets of your business. In virtually every case, they are also guaranteed by the principals, and it is entirely likely that they will have liens on your other assets that are outside of the company’s operations, such as homes and bank accounts. These secured creditors have a priority lien on the assets that secure their loans, and as a result have the right to seize and foreclose upon your assets if defaults occur. Obviously no business can survive without its major assets, so these debts need to be handled with great care if not paid.

Many times, secured loan terms can be re-negotiated and modified by agreements with the secured creditors in advance. Such renegotiated terms can be beneficial to both parties. Hopefully, terms can be arrived at that will allow you to reduce your monthly payments, while at the same time providing the secured party greater confidence that the newly negotiated payments can be made.

These negotiations can also be beneficial to lenders in that they can provide information about your business and its future, as well as instill greater confidence that the reduced payments can not only be met, but will give your business the relief that it needs in order to avoid further defaults.

Any further defaults are likely to lead to perhaps a liquidation, foreclosure on assets at fire-sale prices, and not only the loss of your business but substantial losses to the lender, as a result of a forced liquidation sale remedy. The secured creditors, if given the appropriate information, may be willing to work with you to help you through difficult times in the hopes that your business can prosper. This will potentially increase its recovery either by refinancing with other lenders or by maximizing results by an orderly liquidation if things do not pan out as planned.

This is certainly a much better approach and less stressful for all parties as opposed to allowing these loans to go into delinquency due to non-payment. Most secured creditors are willing to work with their borrowers through troubled times as long as they are fully aware of the circumstances and do not feel that they are being further endangered. Therefore, it is best to talk early and often with these lenders in order to receive their help, support, and patience.

Obviously these discussions should be held only after substantial preparation with your financial advisor and attorney, and all parties should be present at any meetings with lenders.

Potential Short-term Cash Relief

Generally this leaves a third group: unsecured trade creditors. These creditors, some of whom are likely your friends and associates, are really at the bottom of the food chain in the event of a foreclosure or other liquidation. They are usually suppliers of goods or services on open accounts, and their rights are generally subject to the secured creditor’s claims and the priority tax and wage claims. They have little or no leverage except to cease to deliver goods and/or take legal action.

This is the group that can most likely be worked with in order to obtain some limited relief. Since these creditors stand to lose the most by both their inability to collect the outstanding debt and the potential loss of what may be a good customer, it is likely that they will agree to a limited moratorium on payments as long as they are not prejudiced any further.

They should insist upon and be offered at least payment for any new goods or services delivered from this time on so that they do not lose any further ground. Most likely, a liquidation by secured creditors will leave them high and dry, so there are real incentives for them to provide some relief as long as they are being fairly treated. Hopefully, a relatively short time period for a moratorium on payments will provide the time to scale down costs, increase sales, and take whatever other steps are necessary in order to bring the cash flow back in line.

The best time to deal with these issues is early, before any crisis appears. In this way, companies are most likely to be able to negotiate terms that are helpful without creating a history of broken promises and a breakdown of relationships. The goal is to ultimately reach a commitment that leads to a turnaround of the business.

It is highly likely that a company that would otherwise be a candidate for a reorganization proceeding such as a Chapter 11 bankruptcy can avoid that if these issues are recognized early. The alternatives, although possible, are costly and stressful.

In summary, it is key to recognize the problem early, create a plausible solution, and discuss it openly with the various creditor groups. This planning will enhance the likely survival and future prosperity of any business that is properly planned and operated.

Paul R. Salvage, Esq. is senior partner and co-chair of Bacon Wilson’s Business Reorganization and Insolvency department. His law practice deals with sophisticated workout and bankruptcy matters, representing both creditors and individuals or companies facing financial difficulties. His additional specialties include creditor’s rights, business law, and real estate; (413) 781-0560;[email protected]

Sections Supplements
The Effect of E-mail Communication on Attorney-client Privilege

There is no doubt that we are all more technologically advanced than ever. What used to be just a cell phone is now our phone, a camera, and it plays music. We are able to communicate with each other electronically 24 hours a day, and some of us have created relationships with others whom we have never met, having only communicated through E-mail, chat rooms, or social-networking sites such as MySpace, Facebook, or LinkedIn.

What we don’t consider is how these advanced means of communication may be creating a trail that we do not want to be followed.

Attorneys are always mindful of the attorney-client privilege. A prudent practitioner will take tremendous steps to see that communications between their client and themselves do not fall outside of that privilege. We instruct our clients as to the importance of the privilege and to take steps to insure that no one is privy to the communications so that the privilege may be lost.

What some may not realize, though, is that they may be losing this privilege via the use of E-mail or other forms of electronic communication. A question arises: when a client communicates with his attorney via E-mail, is this communication still protected by attorney-client privilege?

This issue that has yet to be addressed by the Appeals Court or the Supreme Judicial Court in the Commonwealth of Massachusetts, but it has begun to be addressed by courts in other jurisdictions. Notably, courts in the state of Tennessee in the case of Hazard v. Hazard stated that when one of the parties sent a letter to their attorney through the family computer, this communication was not protected by the attorney-client privilege. The court in the Hazard case reasoned that, because others had access to the computer, it was as if the husband was talking to his attorney with his wife in the room.

In addition to the ruling in the Hazard case, other jurisdictions have held that there is no expectation of privacy on the family computer even if you are able to ‘password protect’ your communications. The consensus of other jurisdictions on this issue is that if others have access to the computer, anything that you do on this computer is fair game.

This is not the first time that courts have determined that communications one might think are privileged are actually not safe from disclosure in the future. The issue arose previously when dealing with E-mail communications between a husband and wife.

In Massachusetts, there is a doctrine known as spousal disqualification. This represents the proposition that communications between a husband and wife are private and cannot be disclosed to others by either spouse. (Note: There are exceptions to this rule that are not detailed here because they are not relevant to this discussion.)

Courts in Massachusetts have held that this disqualification does not pertain to E-mails that are exchanged between the parties. The courts have reasoned that once the communication is put into writing, it is no longer to be considered subject to the disqualification. This may be somewhat disheartening to those who consistently use E-mail as a substitute for verbal communication and may now be faced with the prospect of being confronted with statements that would not otherwise be admissible, but now are because they have been reduced to writing.

How can you prevent losing the privilege as it relates to either attorney-client or spousal communications? Here are some simple tips:

  • If you must send something electronically, use a computer that cannot be accessed by anyone else. Don’t use the family computer, and don’t use your work computer. If the computer used is yours alone, you can expect whatever is sent from it to be private.
  • Think before you write. Resist the temptation to send your spouse a scathing E-mail message or to engage in any other inappropriate language. A simple rule to follow is to assume that whatever you send may be read by someone else, such as a judge.
  • Don’t communicate electronically when you can do it verbally. We all fall victim to the ease of E-mail, but as noted above, this can create a trail that you might otherwise wish did not exist.
  • Technology has made all of our lives more convenient in many ways, and it has allowed us to communicate in ways some may never have thought possible. But as we have seen, it can create pitfalls that we all may want to avoid.

    Michael J. Grilli is an associate with the Springfield-based law firm of Bacon Wilson, P.C. His areas of expertise include divorce/family law, personal bankruptcy, and residential real estate; (413) 781-0560;[email protected]

    Departments

    The following is a compilation of recent lawsuits involving area businesses and organizations. These are strictly allegations that have yet to be proven in a court of law. Readers are advised to contact the parties listed, or the court, for more information concerning the individual claims.

    CHICOPEE DISTRICT COURT

    Legowski Landscaping & Construction v. Creative Design
    Allegation: Non-payment of landscaping services: $18,000
    Filed: 6/11/08

    FRANKLIN SUPERIOR COURT

    Erin Szalankiewicz v. Bulkley Healthcare Center
    Allegation: Employment discrimination: $25,000+
    Filed: 6/17/08

    Laurie Baggetta v. Judith Hamilton and Lydian Enterprises Inc.
    Allegation: Negligent establishment of an area for dancing causing injury: $101,480
    Filed: 6/23/08

    HAMPDEN SUPERIOR COURT

    Construction Service, a division of Dauphinias & Son Inc. v. T&M Concrete
    Allegation: Non-payment of merchandise sold and delivered: $37,924.01
    Filed: 6/05/08

    David L. Clowes Painting and Decorating v. GFI Prospect Park Development and GFI Longbrook, LLC
    Allegation: Non-payment of labor and materials: $29,200
    Filed: 6/26/08

    Dusty Corporation v. Donovan Oil Co.
    Allegation: Failure to properly bleed heating system, resulting in water damage to home: $27,983.45
    Filed: 6/28/08

    John Angelica v. A. Boilard Sons Inc.
    Allegation: Breach of warranties and damages: $50,000
    Filed: 6/30/08

    Liberty Mutual Insurance Company v. AG Asbestos Inc., et al
    Allegation: Breach of worker’s compensation policy and fraudulent misrepresentation: $189,208.89
    Filed: 6/23/08

    Macey Trustee, et al v. GBG Consulting Services, LLC
    Allegation: Breach of contract: $114,508.42
    Filed: 5/22/08

    Rockstone Capital, LLC v. D’Amours General Contractors
    Allegation: Breach of small-business credit agreement: $68,406.83
    Filed: 6/25/08

    Shawn P. Allyn v. GFI Longbrook LLC
    Allegation: Breach of contract and real-estate fraud: $30,000
    Filed: 6/25/08

    HAMPSHIRE SUPERIOR COURT

    Mary Lou Sanborn v. Gatesman Electric, LLC
    Allegation: Non-payment of goods and services rendered: $38,958.17
    Filed: 6/16/08

    Seth Powers v. JDR Builders
    Allegation: Negligent and unsafe working conditions causing permanent injury: $1,127,000
    Filed: 6/17/08

    NORTHAMPTON DISTRICT COURT

    Analysts in Media Inc. v. Overlook Industries Inc.
    Allegation: Breach of advertising agreement: $20,516
    Filed: 6/30/08

    Karen Barnes v. Starbucks Coffee Co.
    Allegation: Improperly placed lid on cup and other negligence, causing serious injury: $15,577.00

    PALMER DISTRICT COURT

    Gallerani Electric Co. Inc. v. O’Driscoll’s Inc.
    Allegation: Non-payment of electrical work: $4,135
    Filed: 6/10/08

    Mary Hall v. Yogi Bear’s Sturbridge Jellystone Park Resort
    Allegation: Failure to maintain property, causing slip and fall: $5,360
    Filed: 6/13/08

    SPRINGFIELD DISTRICT COURT

    Bradco Supply Co. v. CP McDonough Construction Corp.
    Allegation: Non-payment of merchandise sold and delivered: $8,478.76
    Filed: 4/16/08

    City of Holyoke Gas & Electric v. Nutmeg International Trucks Inc.
    Allegation: While in defendant’s possession, vehicle was broken into, damaged, and had items stolen: $5,524.00

    Emanuel Brown v. Michael Brown d/b/a Building Renovations
    Allegation: Breach of contract for residential renovations: $5,000
    Filed: 4/02/08

    General Construction & Environmental Inc. v. On Target Utility Services
    Allegation: Non-payment of services rendered: $5,525
    Filed: 4/03/08

    Liberty Mutual Insurance Co. v. Lumas Painting Inc.
    Allegation: Non-payment of workers’ compensation insurance: $11,249.70
    Filed: 4/09/08

    Martindale-Hubbell v. Hare & Stamm
    Allegation: Non-payment of services rendered: $4,259
    Filed: 4/01/08

    O.K. Baker Supply Co. Inc. v. Gus & Paul’s Bakery
    Allegation: Non-payment of merchandise sold and delivered: $16,890.65
    Filed: 4/04/08

    Saga Communications of NE Inc. v. Good Deal Auto
    Allegation: Non-payment of advertising services: $10,436.60
    Filed: 6/25/08

    Springfield Lumber Company v. Allied Industries Inc.
    Allegation: Non-payment of merchandise sold and delivered: $20,891.56
    Filed: 3/28/08

    TBF Financial, LLC v. Ashton Services Inc.
    Allegation: Breach of lease agreement: $11,920.89
    Filed: 4/18/08

    Zielinski Brothers Inc. v. Hydro-Pro Inc.
    Allegation: Negligent installation of irrigation system, causing damage: $15,000
    Filed: 4/09/08

    Departments

    The following is a compilation of recent lawsuits involving area businesses and organizations. These are strictly allegations that have yet to be proven in a court of law. Readers are advised to contact the parties listed, or the court, for more information concerning the individual claims.

    FRANKLIN SUPERIOR COURT

    David & Erin Beaudet v. Haydenville Woodworking & Design Inc.
    Allegation: Defendant negligently installed a wood-burning stove, causing a fire and severe damages to property:
    $445,689.96
    Filed: 5-27-08

    GREENFIELD DISTRICT COURT

    Ford Motor Credit Company, LLC v. Fox Builders Inc.
    Allegation: Default on a retail installment sales agreement: $4,050.65
    Filed: 5-12-08

    HAMPDEN SUPERIOR COURT

    Donald & Sandra Hicks v. General Motors Corp. and Central Chevrolet Inc.
    Allegation: Breach of warranty and violation of Mass. Consumer Protection Act: $35,000
    Filed: 4-22-08

    Mariela Rivera v. Bertera Chrysler Inc.
    Allegation: Violation of used vehicle lemon law: $17,500
    Filed: 4-22-08

    HAMPSHIRE SUPERIOR COURT

    Diversified Construction Services, LLC v. Modular Space Corporation Inc.
    Allegation: Non-payment on contract for labor and materials: $194,955.02
    Filed: 5-19-08

    HOLYOKE DISTRICT COURT

    Consolidated Container Company, LP v. Glacierware Manufacturing Inc.
    Allegation: Non-payment of merchandise sold and delivered: $13,782
    Filed: 5-28-08

    NORTHAMPTON DISTRICT COURT

    Berkshire Design Group Inc. v. Two Pond Farm LLC
    Allegation: Non-payment of services rendered: $26,208.43
    Filed: 5-15-08

    Rugg Building Solutions v. Equity Builders Realty, LLC
    Allegation: Non-payment of merchandise sold and delivered: $4,331.76
    Filed: 5-19-08

    Patrick E. McDonald v. Atlas Copco Compressors, LLC
    Allegation: Breach of contract to pay severance: $18,038.46
    Filed: 5-19-08

    PALMER DISTRICT COURT

    Beers & Story Inc. v. FX Directors Solutions & Davidson Software Systems Inc.
    Allegation: Breach of contract for Web site design and management services:
    $10,580
    Filed: 4-28-08

    Robert Half International Inc. v. Guidance Pathway Systems Inc.
    Allegation: Breach of contract for services rendered: $11,650
    Filed: 5-02-08

    SPRINGFIELD DISTRICT COURT

    A & A Home Repair Service v. FHRIM Realty Group & Greenspan Realty & Affordable Property Management
    Allegation: Breach of written and oral contracts: $14,401.82
    Filed: 2-26-08

    Richard Laterreur v. G.B.P. Inc.
    Allegation: Unpaid repair and storage of motor vehicle: $7,500
    Filed: 3-31-08

    Yellow Cab v. Advanced Back & Neck Center of Mass., P.C.
    Allegation: Unpaid transportation services and charges: $6,577.95
    Filed: 4-15-08

    WESTFIELD DISTRICT COURT

    Nam King Garden Inc. v. Coyote Realty, LLC
    Allegation: Breach of lease obligation: $70,000
    Filed: 5-14-08

    Health Care Sections
    Keeping Health Care Reform on the Front Burner

    No single reform would do as much to improve the wealth of our nation and the lives of Americans as a comprehensive overhaul of our health care system. But the best chance of swift and major reform may have died with the end of Hillary Clinton’s run for the White House.

    Sen. Clinton kept health care on the front burner, promising action in her first term. Health care has already slipped as the top domestic concern, a position it held earlier in the campaign for the first time since the last Clinton campaign in 1992. The economy has passed it. But you can’t have a healthy economy without a functioning health care system.

    Unfortunately, there are no easy fixes, no simple wands that can be waved to solve what ails our health care delivery system.

    America should be the envy of the world when it comes to delivering health care, since we pay more per capita than any other nation, soon nearly 20% of our gross domestic product. In many areas of medicine, particularly in research, we are leading the world. But in others, we are not keeping pace.

    We have the second-worst newborn-mortality rate in the industrialized world, and rank highest in preventable medical errors. Even worse, one in six Americans has no access to high-quality medical care. What we need from the next president is real leadership and a vision for changing what’s wrong with our health care system.

    Sens. John McCain and Barack Obama have reform plans that take divergent paths, neither of which is as comprehensive as Clinton’s. Obama would require that children have health coverage, but not adults. The problem with that is, if there is no mandate for adults, the young and the healthy will opt out, leaving the older and sicker in the system. This would likely force premiums up.

    Obama takes a page from the Massachusetts health-reform law and would require employers to offer ‘meaningful coverage’ or contribute to a new public plan for the uninsured and small businesses. He also says health insurance would be more affordable with lower co-pays and deductibles, and he would require insurers to offer coverage without exclusion for pre-existing conditions. He would also allow those without insurance through an employer to buy into plans now available to some federal employees.

    McCain’s plan follows the Republican playbook, that the answer is to cut costs and inspire all Americans to buy insurance by means of tax incentives. His plan would end the tax deduction that employers get for their share of employees’ premiums, thus undercutting the employer base of most families’ insurance. Instead, he would give families a $5,000 tax credit toward any coverage they buy.

    The McCain camp says the tax credit should encourage insurance companies to develop plans that come in at that price, no easy task in high-cost states such as Massachusetts. He would encourage competition by allowing insurance to be sold across state lines.

    Both plans fall short, and neither truly promises universal access. McCain’s plan is particularly radical in that it would eliminate the ‘safety net’ that employees have come to value and would undoubtedly put more of the cost of health care directly on individuals and families. Furthermore, individual insurance sold on the open market is inevitably more inefficient for insurers and more expensive for consumers. It may make it harder for those with chronic conditions to get health insurance.

    There are three areas the next president must focus on, and all three must be in balance: making sure every American has health insurance, improving the quality of care, and controlling costs. Viable solutions to our nation’s health care crisis will require a bold plan for action, not rhetoric. We can thank Clinton for driving that point home. Whether her health plan was right or wrong, she was tenacious and brave, and her plan was the most comprehensive and detailed. We should demand the same from McCain and Obama.

    Departments

    The following is a compilation of recent lawsuits involving area businesses and organizations. These are strictly allegations that have yet to be proven in a court of law. Readers are advised to contact the parties listed, or the court, for more information concerning the individual claims.

    CHICOPEE DISTRICT COURT

    Gilbert & Sons Insulation Inc. v. Maple Ridge Construction Inc.
    Allegation: Non-payment of insulation services rendered: $3,269.07
    Filed: 5-15-08

    GREENFIELD DISTRICT COURT

    Bunker Hill Insurance Company v. Cooke Construction
    Allegation: Contractor failed to protect the interior of property from water damage: $14,198.08
    Filed: 5-15-08

    HAMPDEN SUPERIOR COURT

    Consolidated Health Plans Inc. v. Regis College
    Allegation: Breach of contract and failure to pay for services rendered: $224,264
    Filed: 4-23-08

    Doralbo Velasquez and Julio Abrew v. Baystate Health Inc.
    Allegation: Medical malpractice: $2,000,000
    Filed: 4-25-08

    Little River Plaza LLC v. Manny’s TV & Appliance Inc.
    Allegation: Defendant has failed to pay sums due under a written lease agreement: $90,000+
    Filed: 4-28-08

    HAMPSHIRE SUPERIOR COURT

    Commonwealth of Massachusetts v. Presstek Inc. & SDK Realty Corp.
    Allegation: Gas cloud and chemical release at facility operated by Presstek and owned by SDK Realty. Monies owed for cost of emergency mitigation response action: $192,125.32
    Filed: 6-04-08

    Rugg Building Solutions v. Souza Building and Design, LLC
    Allegation: Non-payment of merchandise sold & delivered: $48,396.60
    Filed: 5-28-08

    HOLYOKE DISTRICT COURT

    Verizon New England Inc. v. City of Holyoke
    Allegation: Negligent performance of excavation work causing damage: $16,781.04
    Filed: 5-15-08

    NORTHAMPTON DISTRICT COURT

    E. Osterman Gas Services Inc. v. MaMa Maria
    Allegation: Non-payment of goods and services purchased on account: $4,011.33
    Filed: 5-28-08:

    E. Osterman Gas Services Inc. v. the O’Leary Company Inc.
    Allegation: Non-payment of goods and services purchased on account: $5,401.60
    Filed: 5-28-08

    Rugg Building Solutions v. W. Kulig Inc.
    Allegation: Non-payment of merchandise sold and delivered: $9,634.52
    Filed: 6-02-08

    PALMER DISTRICT COURT

    Capital One Bank USA v. Custom Computers Inc.
    Allegation: Non-payment on credit account for goods sold and delivered: $6,959.30
    Filed: 5-21-08

    SPRINGFIELD DISTRICT COURT

    Broadcast Music Inc. v. Ares Inc.
    Allegation: Claim on defaulted contract: $3,015.84
    Filed: 2-20-08

    Steven Bilodeau v. Pioneer Valley Concrete Services
    Allegation: Non-payment of wages: $5,216.60
    Filed: 2-29-08

    Clarification:

    An item in the Court Dockets from the June 9 issue of BusinessWest is in need of clarification. The suit, Carol L. and James S. Glanville v. Hu Ke Lau Restaurant, involves the establishment in Longmeadow, which is under different ownership than the facility on Memorial Drive in Chicopee.

    Departments

    Bradley J. Lucido was recently named Chief Compliance Officer of the MassMutual Financial Group in Springfield, succeeding Margaret Sperry, Senior Vice President and Chief Compliance Officer, upon her retirement on July 1 after 27 years with the company. Lucido is currently a vice president and associate general counsel responsible for all regulatory matters at MassMutual’s investment management affiliate, Babson Capital Management. He now joins MassMutual as a senior vice president with responsibility for oversight of ethics, compliance and government programs, policies, and procedures across the MassMutual Financial Group companies.

    •••••

    Adam Raczkowski of W.F. Young Inc. in East Longmeadow has been elected to serve on the Board of Directors of the Consumer Healthcare Products Assoc. He also holds the positions of Executive Vice President, COO, CFO, and General Manager.

    •••••

    PeoplesBank has named Paul E. Hillsburg as Assistant Vice President for PeoplesFinancial and Insurance Services at the bank’s South Hadley office. Hillsburg has served as a financial consultant for Infinex Financial Group and as a financial advisor for Merrill Lynch. He holds Series 7 and 66 registrations and holds an insurance license with life, health, and variable products.

    •••••

    Nadia M. Baral has been promoted to the position of Compliance Officer at Springfield-based Hampden Bank. In her new position, she will be primarily responsible for the day-to-day regulatory compliance functions.

    •••••

    The Springfield-based law firm Shatz, Schwartz and Fentin, P.C. announced the following:
    • Ann I. Weber, an attorney and shareholder with the firm, was the guest speaker at the May Estate Planning Council luncheon staged at the Colony Club in Springfield. Weber presented on the topic “Safeguarding the Castle: Can a Trust Keep the Dragon from the Gate?” Weber explored with the audience ways of protecting homes and investment properties from taxes and the cost of long-term care; and
    • Carol Cioe Klyman, attorney and shareholder with the firm who specializes in elder law, estate planning, guardianships, and probate litigation, is among the contributors to The CPA’s Guide to Long-term Care Planning, recently published by the American Institute of Certified Public Accountants and ElderLawAnswers. Klyman contributed to the book’s section on Massachusetts.

    •••••

    Stanley D. Komack, an attorney operating Record Title & Law Offices in West Springfield, has been chosen as the 2008 Affiliate Member of the Year by the Realtor Assoc. of Pioneer Valley. Komack, a member since 1972, has played an active role on a number of committees, including service as the 2008 chairman of the Affiliate-Realtor Work Group, and as a member of the Realtor of the Year Committee and the President’s Advisory Group.

    •••••

    The Associated Industries of Mass. announced that the following Western Mass. business leaders have been elected to three-year terms on AIM’s board of directors:
    • Jens Bauer, Managing Director of Interprint Inc. in Pittsfield;
    • Charles Hatch, General Manager of Packaging Corp. of America in Northampton; and
    • Jay Nesbitt, Plant Manager at Solutia Inc. in Springfield.

    •••••

    Environmental Compliance Services Inc. has named Al Les as a Senior Project Manager. His primary responsibilities include providing functional expertise in the areas of safety and health, industrial hygiene, homeland security, and environmental management. Les is a Massachusetts board-certified wastewater treatment operator.

    •••••

    Shane Bajnoci, Chief Forester and Saw Mill Manager at Cowls Land and Lumber Company in North Amherst, has received the Oustanding Management of Resources Award from the Northeastern Loggers Assoc.

    •••••

    Julia Kincade has been named Manager of Ticket Operations for the Springfield Falcons.

    •••••

    Notch Mechanical Constructors of Chicopee announced that Sharon Orr has taken over as President, and Steven Neveu, previous President, will assume the position of Vice President of Business Development. Neveu will also lead new ventures in Eastern Mass., including a new subsidiary, Energy Recovery Systems LLC.

    •••••

    The Association of Independent Colleges and Universities announced that Dr. Anthony Caprio, President of Western New England College, has been elected to serve on its executive committee of college and university presidents.

    •••••

    The Hampden District Medical Society announced the following:
    • Dr. Philip Stoddard was awarded the 2008 Senior Volunteer Physician of the Year Award. Stoddard, a past President (1981-82), was nominated for this award based on his substantial contributions performing cleft lip and palate surgery at Shriners Hospital for Children in Springfield;
    • Dr. Cyril Shea Jr., retired Orthopedic Surgeon; Dr. Alonzo Sheffield Jr., retired Gastroenterologist; Dr. John Sullivan, retired Pathologist; Dr. William Walthall Jr., retired Radiologist; and Dr. Alan Ziskind, retired Pediatrician, were awarded the 50-year Member Award;
    • Dr. Stephen A. Metz was recently named President;
    • Dr. James K. Wang, Assistant Clinical Professor, Department of Ob/Gyn, Baystate Medical Center, was named President-elect;
    • Dr. Claudia T. Martorell, an Infectious Disease physician in private practice in Springfield, was named Vice President;
    • Dr. Teresa Klich-Nowak, an internist who specializes in Rheumatology in Holyoke, was named Secretary;
    • Dr. Mark Mullan, an Internist with Cardiology & Internal Medicine in Springfield, was named Treasurer;
    • Serving as Trustee to the Mass. Medical Society Board of Trustees is Dr. Mark Sherman, a cardiothoracic, vascular surgeon in private practice in Springfield; and
    • Dr. Stephen Metz was named Alternate Trustee.

    •••••

    UMass Amherst’s School of Education announced its first-annual Awards of Distinction, given this year to nine educators from across the country who are UMass alumni, including:
    • Westfield State College President Evan S. Dobelle;
    • Mary Cowhey, recipient of the Milken National Educator Award and a Teacher at the Jackson Street School in Northampton;
    • Patricia Crosson, Professor Emeritus and Trustee of Greenfield Community College; and
    • James Mullen Jr. President of Elms College in Chicopee and soon-to-be President of Allegheny College in Pennsylvania.

    •••••

    David Hayes has joined Sports Travel & Tours as a Travel Coordinator.

    •••••

    Ken LeGendre has joined Unemployment Tax Control Associates of Springfield as Vice President of Business Development. He will be responsible for developing strategic marketing and sales plans to accommodate corporate goals for the company, which assists clients with reducing the cost and complexities of managing their unemployment compensation programs. LeGendre was previously a national sales manager for a Manhattan-based company at which he developed sales and marketing plans for executive conferences staged on cruise ships and luxury resorts.

    •••••

    Wanda Mooney, a Real Estate Sales Associate with Coldwell Banker Upton-Massamont Realtors, has been recognized as the No. 1 sales associate in Massachusetts for the highest number of closed transactions for Coldwell Banker Affiliates in 2007.

    •••••

    The Center for Human Development in Springfield announced the following awards and accomplishments of staff members:
    • Deviegene Reid has received the Mass. State Assoc. of Developmental Disabilities Providers Direct Support Professional Award for 2008 in recognition of superior performance in her work. Reid has been a House Manager for the Meadows Homes Program in West Springfield for six years.
    • Ja’Net Smith, Clinical Director for the Center for Human Development, has been recognized as one of BusinessWest’s Forty Under 40 recipients; and
    • Program Director Jim Williams will be honored as the recipient of the Robert J. Van Wart Award, which is given to an individual who has worked as a leader in a nonprofit or public human-service organization for at least five years and demonstrates leadership skills.

    Opinion

    It was with significant fanfare — and some lofty rhetoric — that Gov. Deval Patrick signed into law a 10-year, $1 billion life-sciences bill that he first put on the table more than a year ago in an effort to boost the state’s already-strong national and global position in that industry.

    The measure calls for a $95 million research center at UMass Amherst, and the university’s president, Jack Wilson, called the life-sciences initiative “a game changer for the Commonwealth.” Elaborating, he said the bill would create “new breakthroughs, new jobs, and new companies.”

    It will do so, according to its proponents, through $250 million in tax credits for companies, $250 million in research grants, and $500 million in bonds for capital projects. Locally, in addition to the new research center at UMass, the bill calls for $5.5 million to be earmarked for a business incubator at the Pioneer Valley Life Sciences Institute in Springfield, a joint venture between UMass and Baystate Health.

    Dr. Paul Friedmann, director of the PVLSI, said the bill will enable the state to more effectively compete with other states and other countries at a time when said competition is considerable — and mounting. Indeed, Maryland Gov. Martin O’Mally this week unveiled his own $1.1 billion plan to buoy that state’s life-sciences industry, while California, Texas, and other states have also made sizeable investments.

    But if the BIO bill, as it’s called in some quarters, represents a step forward, perhaps a giant step, in terms of competitiveness in that all-important sector, the state is in danger of taking two steps back with regard to its overall economic health and prospects for future job growth.

    Several measures small and large, ranging from $500 million in corporate tax hikes that are soon to be enacted, to soaring health insurance costs, to a bill mandating triple damages in cases involving violation of state wage-and-hour laws, threaten to seriously impact the state’s level of competitiveness and possibly bring the term ‘Taxachusetts’ back into vogue.

    The governor didn’t sign the amendment to the Commonwealth’s wage-and-hour laws — in fact, he wrote legislators a letter warning them of its possible consequences to businesses large and small. But only a few of the representatives heeded the message.

    And this was not a conservative Republican governor sending out that letter and challenging the largely Democratic Legislature to take a step back and consider the ramifications of its actions — but a fellow Democrat, one who took office with hopes that he and members of the House and Senate could work together to bolster the state’s economic future.

    The disconnect between Patrick and the Legislature on the triple-damages provision underscores the need for a government-wide focus on making this state more competitive across all sectors of business.

    What’s needed overall is a change in attitude, and this is nothing new. For too long now, business in Massachusetts has been viewed as something to tax more heavily when times are tough. When jobs are lost and businesses close or move out, there is significant mourning and finger-pointing about what could have been done differently. But there has never really been a broad focus on efforts to truly make Massachusetts more business-friendly.

    Elected leaders can do it for a little while, as they did in the late ’90s, and they can make some big headlines, as they did with the BIO bill. But they need to be more consistent and, overall, change the general attitude about business in this state. And they need to do it soon, because the competition is mounting, and not just in the life-sciences sector.

    The BIO bill may indeed prove to be a game-changing step for Massachusetts. It holds enormous promise for the state and especially for UMass Amherst, which can, and needs to be, a more powerful economic engine for the Commonwealth.

    But while putting in place these tax credits, bonds, and research grants for selected players in this emerging sector, elected officials have to consider businesses of all shapes and sizes and what it will take to bring them here or keep them here.

    And this will take real leadership — something we need to see much more of.

    Features
    Four Simple Steps to Manage Your Boss

    Conventional business communication has been always been defined from the top down. There are limitless books, seminars, and online resources on top-down management you can access any time.

    However, this is not the case for managing up. Middle management continues to struggle to effectively influence executive management, which is crucial to business survival.

    Not only should middle managers be able to listen to the problems and challenges of their direct reports, but they should be able to influence a positive change going upward in the organization.

    Upward management may be the most important skill set to hone and own, particularity in the volatility of today’s economy. Who better to ‘have your back’ than the boss who is front of you all the time?

    The following four-step approach is chock full of nuggets that are simple, but potent. These are not about sucking up or being a ‘yes’ man or woman; rather, these are practical behaviors that require diligence, courage, and transparency. You just may find that you’d like to be managed by your direct reports in similar fashion.

    Step One: Choose Good Timing

    Part of knowing the right timing is setting expectations with your boss upfront, but if you haven’t covered this ground, or the scope of responsibility has changed for either of you, it may be time to realign. Rather than assume what seems appropriate, consider these tips when timing your connections:

    If you and your boss have travel schedules not conducive to face-to-face dialogue, simply inquire, “when can I get you on the phone for 20 minutes? I’d really like your input.”

    When you have something heavier to discuss, inform your boss about the importance of the matter. Many employees will try to connect with their boss once or twice, and when they don’t get the attention they need, they harbor resentment. While it’s frustrating, chances are your boss is buried with work like you, and availability may be at a premium. Stay on him or her, and be tactfully persistent.

    Discover the best times for your boss and yourself to speak. Designated times may end up saving time and building strong communication, fueling better results.

    Step Two: Understand How Your Boss Prefers Information

    Perhaps the most common error employees make is they deliver information in the opposite manner that their boss prefers receiving it. This does little to help their connection or personal market value.

    A month ago, I gained insight on this topic from my brother, who is a partner at a Chicago law firm. He responded, “some bosses want you to issue-spot, meaning quickly identify the issue you need input on and get to the point. Others want context and background around the subjects being addressed. We’re often accused of not listening, but it poses a challenge when you’re coming to us with the wrong approach.”

    So, how does one know what the preferred communication is with the boss? Eliminate uncertainty by asking so you can provide the highest value on a consistent basis.

    Other tips to consider:

    Be succinct and to the point. Even if your boss prefers context and background, avoid rambling on.

    State upfront why you’re coming and what you’re hoping to gain from the encounter. There’s nothing worse than explaining your situation to your boss, and after five minutes he or she interrupts and politely says, “I’m sorry, Susan, what exactly can I help you with?”

    Bring solutions to problems. Sure, you are approaching your boss for answers and feedback, but he or she wants to know you’ve thought it through. The less time they have to spend solving your problems, the more they value your contribution.

    Do your best to be clinical and emotionally controlled. Often what stands out above anything is your ability to demonstrate passion and confidence, providing you remain cool and in control. Emotional intelligence is key.

    Step Three: Align Understanding

    When wondering about the perception of his performance, my client John from New York once told me, “I really dislike the one-time annual review. I need to know how I’m doing more often so I can constantly improve.”

    When I asked him what he does about it, he replied, “every six to eight weeks, I approach my boss and ask him two questions: ‘What am I doing well?’ and ‘Where can I improve?’”

    John’s approach may be slightly more frequent than you prefer, but it’s so much better than the guessing game that comes with anxiety or fear, particularly in today’s unstable market. A different client inquired about the approach he should take to get into a business-development position with his company. I told him, “approach your boss and tell him you’d like to get into business development, and state the value you believe you can provide.” When in doubt, ask.

    Step Four: Follow Up and Live Your Word

    Few things in managing up are more demoralizing than a boss who doesn’t follow up or get back to you on issues that are important to you and seemed the same to them. This is why it’s critical to capture information in writing during the meeting so they know you’re retaining exchanged data and expect execution.

    Also, as often as possible, agree on times and dates to follow up on issues discussed so you can diplomatically hold your boss accountable.

    When your boss can rely on you, loyalty is more likely to be reciprocated. Establish trust through deadline-driven behavior and prompt response time.

    The road to success upward is one that can be gratifying and rewarding. In a time of uncertainty, it can be a path that is safe and secure. Consider these steps and remember that you are judged on your behavior, performance, and results, not on your intentions.

    Joe Takash is a keynote speaker and the CEO of performance management firm Victory Consulting, based in LaGrange Park, Ill.;www.joetakash.com

    Sections Supplements
    The Rules Are Changing, So Beware of Costly Non-compliance Penalties

    As spring draws to a close and attention turns toward picnics, barbeques, and ballgames, the clock continues to tick down — to Dec. 31, 2008.

    While many people associate New Year’s Eve with parties and revelry, 2009 will not be a happy year for employees or employers if the non-qualified deferred compensation arrangements and/or plans to which they are a party do not comply with section 409A of the Internal Revenue Code. All businesses — big and small, public and private, non-profit and for-profit — as well as the workers they employ, may be affected by the requirements of and penalties imposed by 409A.

    Section 409A was added to the Internal Revenue code as a result of the enactment of the American Jobs Creation Act of 2004. The impact of this addition is far-reaching and not yet fully appreciated. In fact, if you or your employees participate in a deferred compensation agreement or are a party to an employment or severance agreement that provides for deferred payments, you may be subject to the consequences of non-compliance.

    What, you may ask, are the consequences of non-compliance? The penalties are as straightforward as they are harsh. If a plan, arrangement, or agreement does not meet the exacting standards of 409A, the amount deferred will be included in the employee’s income immediately, even if the employee is not currently eligible to receive that amount. In addition, a penalty tax of 20% will be levied on the amount included in the employee’s income.

    Finally, an interest payment equal to the IRS underpayment rate plus 1% will be applied from the date when the amount was first deferred to the date when it is includable as income to the employee. Taken together with the income taxes you currently pay, these penalties and interest may equal a 50% tax on your income.

    Perhaps the best way to explain the application of 409A is to discuss the plans it does not apply to. For instance, the provision does not apply to qualified retirement plans, such as plans promulgated under Internal Revenue Code sections 401(k), 457(b), and 403(b), nor does it apply to defined benefit pension plans, employee stock option plans, vacation pay, sick pay, death and disability plans, or compensatory time off, and other similar plans. While this may seem like an exhaustive list of retirement plans and benefits, it does not include supplemental employee retirement plans, employment agreements, severance agreements, some split dollar arrangements, stock option plans, and other similar plans.

    To further complicate matters, non-qualified deferred compensation that was vested prior to 2005 is not subject to 409A because of its ‘grandfathering’ provisions. Employers with plans that contain compensation deferred prior to 2005 can choose one of a number of options to preserve the grandfathered status of these deferrals. These options include:

    • Freezing the existing plan;
    • Grandfathering past deferrals while ensuring compliance of new deferrals; and
    • Amending the plan in its entirety so as to ensure compliance.
    • Generally, in order to comply with 409A, a plan and/or arrangement must:
    • Place limitations on when an employee may choose whether or not to defer compensation, if applicable;
    • Clearly identify when an employee may receive deferred compensation; and
    • Place limitations on when a change may be made to the payment date.
    • Elections to defer compensation for services performed during a taxable year must be made by the end of the year immediately preceding that taxable year. This election must include the time and form of payment to which the employee is eligible.

      The limits imposed by 409A on when deferred payments can be received dictate that, in order for a plan or arrangement to comply, it must provide that payments under the plan or arrangement be paid (1) on a date certain; (2) pursuant to a set schedule; and (3) upon the occurrence of a ‘triggering event.’ These triggering events include separation from service, death, disability, change of ownership, or unforeseeable emergency. If your plan is subject to 409A and doesn’t contain the aforementioned conditions, it is now time to begin your 409A compliance program.

      The best way to avoid running afoul of the rules set forth under 409A is to put a comprehensive plan in place as follows:

      • Identify those plans, agreements and/or arrangements that are subject to 409A;
      • Determine who within your organization is responsible for 409A compliance. If your organization does not have an in-house compliance coordinator, you should contact your accountant, attorney, tax advisor, or human resources professional;
      • Evaluate those plans, arrangements, and/or agreements subject to 409A in order to determine whether they are compliant as currently written; and
      • Formulate a plan of action to ensure compliance. Steps may include amending, terminating, or adopting new non-qualified deferred-compensation plans.
      • Section 409A compliance is a complicated and far-reaching endeavor. In order to avoid running afoul of the regulations set forth by 409A, employers should consult with professionals. Several IRS guidance notices have already been written, and more are sure to follow as the effects of 409A are further understood.

        The issues addressed here are merely a sampling of the plans affected by 409A and the options available to employers in order to ensure compliance with its rules. As such, do not wait until summer turns to fall before evaluating the deferred compensation plans to which you are a party. Dec. 31 is the deadline to comply with 409A, and non-compliance is going to result in costly fees and penalties in 2009.

        Dennis G. Egan Jr. is an associate with the regional law firm of Bacon Wilson, P.C., specializing in business and corporate law;[email protected]; (413) 781-0560.

        Sections Supplements
        Some Due Diligence Can Help Employers with This Daunting Task

        Massachusetts and federal law prohibits employers from discrimination on a wide variety of bases, including race, color, religious creed, national origin, sex, sexual orientation, genetic information, military status, ancestry, age, or handicap. In order for these laws to have their intended effect, employees need to pursue claims of workplace discrimination without fear of retaliation from their supervisors and employers.

        Co-workers and others must also feel free to support victims of discrimination who do come forward without fear that they, too, may be putting their jobs at risk by doing so. Our society has seen the importance of whistleblowers, and what happens when they are ignored, in situations ranging from Enron to events in movies like Erin Brockovich.

        Yet courts have expanded the concept of protection from retaliation to the point where many poorly performing employees, sensing discipline or even termination, assert weak or baseless claims of discrimination as a smokescreen in the face of a supervisor’s legitimate criticisms. Recent court decisions seem to give employees who make claims of discrimination a sort of ‘invisibility cloak’ like the one used by Harry Potter to disappear from the prying eyes of his enemies at Hogwarts.

        Employers should always address all claims of employment discrimination carefully and thoroughly, but in some cases, employers are forced to simply forego discipline or risk the near-certainty of expensive litigation.

        What Is a Retaliation Claim?

        Retaliation is a distinct cause of action, motivated at least in part by a distinct intent to punish or to rid a workplace of someone who complains of an unlawful practice.

        Employers need to realize that an employee who brings a charge of discrimination as well as a claim of retaliation can bring both claims forward in court. Juries can, and often do, find that an employer did not discriminate against an employee, but retaliated against the employee, often awarding large damages against the employer.

        Federal and state laws prohibit a wide category of persons, not merely supervisors or employers, from taking adverse action against a person because he or she has opposed a practice forbidden under discrimination laws or because he or she has filed a complaint, testified, or assisted in any proceeding brought under various discrimination laws. Nor may any person coerce, intimidate, threaten, or interfere with any person for aiding or encouraging another person in the exercise or enjoyment of any of the civil rights granted by federal and state anti-discrimination laws.

        Activities protected by the anti-retaliation provisions include speaking to someone at the MCAD, U.S. Equal Employment Opportunity Commission, or another civil rights or law-enforcement agency, or testifying in any proceeding about a charge of discrimination. It can also include complaining to management or filing an internal complaint of discrimination, asking a supervisor or coworker to stop engaging in discriminatory conduct, or cooperating in an internal investigation of discriminatory conduct.

        Expansion of Employment Retaliation Claims

        The U.S. Supreme Court has continued to widen the courthouse doors to persons claiming retaliation. In June of 2006, the Supreme Court handed down its Burlington Northern and Santa Fe Railway Co. v. White case. Sheila White complained about sexual harassment by a supervisor, and she was subsequently reassigned. She filed a charge at the EEOC and a few days later was suspended without pay for 37 days.

        After filing an internal grievance, she was reinstated and received full back pay. She filed a second charge alleging retaliation, and a jury found in her favor, awarding her $43,500 in compensatory damages. The Supreme Court stated that, in order to show a level of harm necessary to support a retaliation claim, a plaintiff must show that a reasonable employee would have found the challenged action materially adverse, which means that it might well have dissuaded a reasonable worker from making or supporting a charge of discrimination.

        This standard is a fact-intensive one, and has encouraged courts to allow retaliation cases to go to full jury trials so that these questions as to how a ‘reasonable employee’ would act would be resolved by a jury.

        Recently, the U.S. Supreme Court continued the trend toward allowing a wide range of retaliation claims to proceed. Section 1981 of the Civil Rights Act of 1866, a predecessor of Title VII of the Civil Rights Act of 1964, prohibits racial discrimination against those that make or enforce contracts, including employment contracts. On May 27, 2008, the Supreme Court decided the case of CBOCS West Inc. v. Humphries extending Section 1981 to prohibit retaliation against those that seek to “vindicate the rights of minorities.”

        Unlike Title VII, which also protects against retaliation, Section 1981 does not require an employee to first file a charge of discrimination, typically within 300 days with the EEOC or MCAD. Consequently, an employee can wait up to four years before brining a wrongful termination or racial harassment claim. While Title VII claims contain caps on certain damages, Section 1981 does not.

        One U.S. Court of Appeals has even gone so far as to protect a man who claims he was fired after his fiancée filed a discrimination charge with the Equal Opportunity Commission against their common employer. The 6th Circuit Court of Appeals sitting in Cincinnati stated that Title VII prohibits employers from taking retaliatory action against employees who, although not directly involved in the protected activity, are so closely related to or associated with others who are directly involved that it is clear that the protected activity motivated the employer’s actions.

        Discrimination and retaliation claims pose particularly sensitive problems for employees when the complaining employee is still employed by the company. The situation becomes compounded when the employee’s supervisor is also the subject of allegations of discrimination. Tensions may reach the boiling point. Little things can add up. While a snub, a stray remark, or certain looks may not by themselves qualify as adverse actions, the combination of actions may slowly ‘add up to a wound.’ As the Supreme Judicial Court has stated, “One pinprick may not be actionable in itself, and its abusive nature may not be apparent except in retrospect, until the pain becomes intolerable.”

        Supervisors often resent being accused of discrimination, maintaining that they are simply enforcing company policies and holding an underperforming employee’s feet to the fire.

        Defending retaliation claims successfully can seem hopeless when the employer takes an adverse action, such as disciplining or terminating an underperforming employee shortly after that employee has made a complaint of discrimination. Courts routinely instruct juries that they are permitted to infer retaliation from the ‘timing and sequence of events.’ An inference of retaliation may be drawn if adverse action is taken against a satisfactorily performing employee in the immediate aftermath of the employer’s becoming aware of the employee’s protected activity, or where the adverse employment action follows close on the heels of protected activity.

        The terms ‘close on the heels’ or ‘immediate aftermath’ have been expanded to include lengths of time up to four months or more. What is an employer to do? Should he merely wait four months after somebody files a charge of discrimination to even talk about terminating the complaining employee?

        Some Practical Tips

        1. Train managers in all categories of potential retaliation complaints. The challenge of dealing with possible retaliation claims places a premium on training all managers and supervisors and recognizing categories of potential retaliation claims.

        2. Document the company’s business reasons for taking an adverse employment action. Although some employees may believe so, making a complaint of discrimination does not confer immunity upon an employee from discipline or from material changes in conditions of employment, including termination. Documentation in writing, including references to specific written policies, rules, and regulations, are essential. The more documentation, the better. If the employer has a progressive discipline policy, it must be careful to follow each and every step of that progressive discipline system, lest skipping a step would be considered retaliatory.

        3. Have a ‘neutral’ party review or administer the discipline. If an employee alleges supervisor discrimination and runs into performance problems, the individual who ultimately administers discipline to address the performance problems should be independent from the accused supervisor. The ultimate decision-maker should be able to demonstrate that she has not merely accepted the recommendations of an accused supervisor at face value, but has made a sufficiently independent determination as to whether discipline or adverse action is appropriate.

        4. Investigate all claims of retaliation, and consider using an independent third party to do so. Employers should investigate all complaints of unlawful conduct, including complaints of retaliation. That policy should be in writing and disseminated to all employees. Employers should consider bringing in trained third-party investigators, whether they are consultants or attorneys, to conduct such investigations. A track record for taking all complaints seriously can prove a valuable tool in the defense of retaliation claims. The employer’s goal should be to investigate and judiciously address all complaints of discrimination so that they never ripen into litigation.

        5. Consider delaying discipline. An employer needs to consider the timing of taking adverse action against persons who have made claims of discrimination. One of the best defenses against any type of discrimination claim, whether a direct claim of discrimination or retaliation, is that the employer gave the employee a second chance, rather than disciplining or terminating. An employee bringing an unsupported, unfounded claim of discrimination often is an employee who will squander a second chance and commit another workplace rules violation that will justify discipline.

        The courts and agencies charged with enforcing anti-discrimination laws will take time to develop workable guidelines on separating legitimate retaliation claims, necessary to protect the right to seek redress for violations of civil-rights laws, from those claims asserted by underperforming employees seeking a legal shield from legitimate discipline. In the meantime, employers need to tighten their policies and practices and ensure that all managers receive appropriate training in preventing retaliation claims.

        Departments

        The following is a compilation of recent lawsuits involving area businesses and organizations. These are strictly allegations that have yet to be proven in a court of law. Readers are advised to contact the parties listed, or the court, for more information concerning the individual claims.

        CHICOPEE DISTRICT COURT

        Gilbert & Son Insulation v. Creative Design Custom Homes
        Allegation: Non-payment of insulation services provided: $4,069.79

        GREENFIELD DISTRICT COURT

        Weslee Sicard v. Favorites Staffing Agency
        Allegation: Emotional distress caused by actions of employee: $5,000
        Filed: 4/29/08

        HAMPDEN SUPERIOR COURT

        C & S Distributors Inc. v. Carlson Siding Company
        Allegation: Non-payment of goods sold and delivered: $87,700.84
        Filed: 4/17/08

        Carol L. and James S. Glanville v. Hu Ke Lau Restaurant
        Allegation: Failure to provide alternate transportation to intoxicated patron resulting in motor vehicle injuries: $186,685.46
        Filed: 4/18/08

        Country Bank for Savings v. Munson Heating
        Allegation: Failure to make payments: $49,699.92
        Filed: 4/22/08

        Peabody Family Investments, LLC v. Turfgrass Environmental Consulting
        Allegation: Breach of Contract: $200,000+
        Filed: 4/22/08

        HAMPSHIRE SUPERIOR COURT

        Doris Montgomery v. City of Northampton
        Allegation: Failure to provide access to health insurance benefits: $10,000
        Filed: 5/05/08

        Laura Singleton v. Sinclair Broadcast Group & Patrick Berry
        Allegation: Employment discrimination and wrongful termination: $633,197+
        Filed: 5/13/08
        Miller Development Enterprise Inc. v. World War II Veteran’s Association of Hampshire County Inc.
        Allegation: Breach of contract for services, labor, and materials: $52,034.00
        Filed: 5/12/08

        Murphy Construction v. Mike’s Landscaping and Excavating
        Allegation: Breach of contract for services, fraud, and intentional misrepresentation: $41,775.52
        Filed: 5/08/08

        NORTHAMPTON DISTRICT COURT

        Michael & Diane Ventrice v. Diamond RV Center & Bridgestone/Firestone Inc.
        Allegation: Plaintiff was sold a recreational vehicle with defective tires, and seller did not remedy: $15,000
        Filed: 4/16/08

        Rugg Building Solutions v. TNT General Contractors Inc.
        Allegation: Non-payment of goods sold and delivered: $16,215.36
        Filed: 5/08/08

        SPRINGFIELD DISTRICT COURT

        Carter-McLeod Paper & Packaging Company v. Iris Media Group Industrial, LLC
        Allegation: Non-payment of goods sold and delivered: $7,027.21
        Filed: 2/06/08

        Reliable Temps Inc. v. C & C Salvage LTD
        Allegation: Failure to pay for temporary employees provided by plaintiff: $4,154
        Filed: 2/14/08

        The Marlin Company v. 135 Benton Drive Operating Company, LLC
        Allegation: Non-payment of goods sold and delivered: $10,535.52
        Filed: 2/16/08

        WESTFIELD DISTRICT COURT

        Capital One Bank (USA) v. Gary’s All Nite Towing
        Allegation: Non-payment of credit account: $17,563.81
        Filed: 4/18/08

        Opinion
        The Battle to Curb Public Pensions

        It’s one step forward, two steps back in the battle to bring pensions and other public-employee retirement benefits under control in Massachusetts. Beginning in January, MBTA retirees under 65 will contribute 15% toward the cost of their health insurance. Most T employees can retire with generous benefits after 23 years. Until now, those benefits included free health care for life. Not a bad deal, especially when you can retire in your 40s.

        Phasing in a plan that would have provided incentives for recent and soon-to-be retirees to choose less expensive health insurance, as proposed by a panel charged with assessing state transportation finances, would have been fairer to those nearing the 23-year mark, saved more money, and avoided a potential spate of retirements at the T. Still, treating younger MBTA retirees the same as retired state employees is a step in the right direction.

        But while most state workers pay around 10% of their salaries toward retirement, T employees still pay just 4%. Unlike state employee contributions — which are set by law — MBTA pension contributions are subject to collective bargaining.

        At least the MBTA pension situation isn’t getting any worse. An amendment adopted during the state House of Representatives budget debate and included in the Senate’s recent budget proposal increases from $12,000 to $16,000 the amount upon which cost-of-living increases are calculated for teacher and other state retiree pensions. Earlier this month, busloads of retired teachers descended on the State House to lobby for pending legislation that would guarantee future escalation by linking the base amount to the consumer price index.

        The change would raise the average pension just $120 for the coming year. But compounded annually, the move could end up costing taxpayers more than $8 billion.

        Next year, taxpayers will pay almost $1.5 billion out of a likely $28 billion budget to retire the Commonwealth’s more than $13 billion unfunded pension liability. Hiking retirement benefits would extend the time at which state pension obligations will be fully funded from 2023 to 2026.

        State Treasurer Tim Cahill warns against extending the date, saying it could hurt the Commonwealth’s bond rating. The higher interest costs that would result are no small matter, given that $16 billion in new borrowing has either recently been approved or appears headed toward approval.

        Payments to retire the liability are set to increase each year, reaching more than $2.8 billion in 2023. That means three additional years would cost taxpayers more than $8 billion. Keeping to the current schedule would result in the annual sum rising even higher than $2.8 billion by 2023.

        Part of the problem with the Commonwealth’s pension system is that it’s just too easy to push the burden out to future generations. Three early-retirement programs earlier this decade saved money in the short term, but added nearly $2 billion to overall liability.

        Reining in pensions is not about shortchanging public employees. For years, the argument was that government workers got rich benefits to make up for lower pay. But according to the federal Bureau of Labor Statistics, public employees in Eastern Mass. now earn 15% more than their private-sector counterparts who perform comparable work, and that number is exclusive of more generous government benefit packages.

        The new health care reform law is just one of the priorities Massachusetts is struggling to fund. If not for the nearly $1.5 billion taxpayers will have to put toward retiring unfunded pension liability next year, the Commonwealth could pay costs related to the law; eliminate the need to pull $400 million from the rainy day fund, as the state Senate did to balance its budget proposal; and still have money left over. That’s why we have to resist the pressure to add to already-staggering liabilities.-

        Charles Chieppo is a senior fellow at the Pioneer Institute. This article first appeared in the Boston Globe.

        Sections Supplements
        The ‘Next Generation’ Takes the Helm at Cooley Shrair
        Peter Shrair, with Motzard.

        Peter Shrair, with Motzard.

        His name is Motzard, or ‘Motz’ for short.

        He’s a 3-year-old, 100-pound ‘gold-oodle,’ as Peter Shrair called it, meaning a cross between a golden retriever and a standard poodle. Shrair took him to work when he was very young so he could keep an eye on him, with the thought that this arrangement would just be for a few days.

        Well, Motz has come to work every day since.

        “Our people love him, clients love him … he’s just a small part of what makes this firm a little different, said Shrair, referring to Springfield-based Cooley Shrair. “Doing things differently is part of our culture, and it always will be.”

        And Shrair will now have a much larger role in defining and shaping that culture. Effective May 1, he became managing principal with the firm, succeeding his father, David, who had held that role for more than 35 years, and just the third person to hold that rank in the company’s 63-year history.

        Unlike at other firms, where one might be managing partner for a few years or maybe five, at Cooley Shrair one can have that role that for decades, said Peter Shrair, who expects that scenario for himself.

        “I equate it to football,” he explained. “You have this job until you lateral it off to someone else — and I don’t expect that I’ll be doing that for a long time.”

        All three generations of managing principals will still be working at the firm’s office on Main Street. This means both Shrairs, and also Sid Cooley, co-founder of the company with his brother, Ed, and a former District Court judge who, at age 94, still reports to work every day.

        They and fellow principals Mark Mason and Robert Damrov will plot a course for the firm, but Peter Shrair will take the lead role. He said he has no master strategy other than to simply continue to stay on the course set down by his predecessors — meaning an operating philosophy that provides clients with much more than an opportunity to pet Motz.

        That philosophy is summed up, he said, in the company’s relatively new marketing slogan: “Unparalleled Response, Unparal-leled Solutions.”

        In this issue, BusinessWest talks with the Shrairs about why they feel comfortable making that claim.

        Working Their Tails Off

        When asked about how his job description and daily routine will change now that he is former managing principal, David Shrair, now 73, was quick and to the point.

        “Not much at all,” he said, adding, “I’m not retiring … I’ll just have a little more time to work harder.”

        With this acknowledged oxymoron, the elder Shrair noted that he has passed several administrative duties on to his son, giving him more time to focus on his speciality — business law, and especially work with several area financial institutions.

        This has been the crux of the firm’s work since the Cooley brothers set up shop in downtown Springfield 1946, and it explains why the firm’s fortunes are tied tightly to the state of the economy and, more specifically, to the health of the banking community.

        During the boom times of the early and mid-’80s, for example, the firm enjoyed explosive growth, and eventually topped out at 22 lawyers. But things changed quickly when the bubble burst, especially for the banking and commercial real-estate sectors.

        “I was on vacation when I read in the Wall Street Journal that Bank of New England was in receivership,” David Shrair recalled. “I knew at that moment that we were going to have to let six lawyers go — Bank of New England was that big a client.”

        It would be several weeks before the firm actually took that step, said Peter, who joined the company in 1986, noting that the six to be laid off were given time to find other employment.

        This act of compassion speaks to the manner in which the company operates, said Peter, who noted that Cooley Shrair refers to itself as a “progressive” law firm. Elaborating, he said this is a mindset, or a family-business mentality, that manifests itself in how clients and staff members are treated.

        As for the latter, there is flexibility with schedules, accommodations made for those trying to balance life and work, and a compensation system that rewards people for results.

        “People do work long, hard hours to do what’s necessary for their clients,” said Peter Shrair. “But we do build in a lot of flexibility. Overall, it’s just an enjoyable place to work, and that’s why we have very little turnover.”

        As for clients, both Shrairs said the company is continuously looking for ways to better serve them, especially in an age when technology and modes of communication prompt expectations of service that run 24/7, not 9 to 5.

        “The firm’s culture has always been ‘service first,’ and that goes back to when I was a young lawyer in the early ’60s,” said David Shrair. “That’s because I had to make my own living — that’s the basis on which Ed and Sid Cooley hired me. They said, ‘c’mon in with us, and let’s see what you can produce.’

        “Well, young lawyers coming out of law school know absolutely nothing about the practice of law,” he continued. “So you had to go out and do something different.”

        That ‘something,’ he said, has been a sharp focus on customer service that he believes is uncommon in the industry — rare enough for him to approve the use of the word ‘unparalleled’ in marketing materials to describe response and service.

        “Most lawyers don’t think client service 24/7,” Shrair continued. “We do, because the culture here has always been service-first, service faster than anyone else can provide it, and expertise that’s equal to or better than what anyone else has.”

        This operating philosophy differentiates the firm in ways far beyond having Motz greet clients at the reception desk, said Peter Shrair, who told BusinessWest that this “attitude,” as he called it, appealed to him when he clerked at his father’s firm while attending law school in the mid-’80s. He said he considered a number of career alternatives while earning his JD, including opportunities in Boston and New York, but ultimately decided that his best option was Springfield and Cooley Shrair.

        “By the time I was midway through law school, I had pretty much made up my mind that this was where I wanted to be,” he said. “I realized that you could do sophisticated work in a small city; you didn’t have to be in Boston or New York.”

        The younger Shrair, who became a partner in 1992 and also focuses on banking-related work, takes the helm in the midst of another economic downturn, albeit one that no one is comparing to 1991, especially with regard to the banking and commercial real-estate sectors. And both the current and former managing principal believe the company’s strong track record with regard to customer service and results will help it not only ride out the storm, but thrive.

        “We’re extremely busy,” said David Shrair, banking his fist on the wooden conference table as he did so. “We’re on pace to surpass last year, and last year, we set some records.”

        Paws for Effect

        When asked about his change in responsibilities and what it will mean for him, Peter Shrair shrugged and, like his father when asked the same question, said, “not much.”

        “I’ll have the same office, the same dog … I’ll just have a little more to do,” he said, adding that he will handle the same legal workload and will have the same title on his business card: ‘Attorney at Law.’

        While the change in command is significant in that the proverbial football has been lateraled after 35 years, nothing much will change at this firm, which has known only one way to do business since the first generation of managing principal.

        George O’Brien can be reached atobrien@businesswest

        Sections Supplements
        Use Caution with Non-competes and Confidentiality Agreements

        Two areas of employment law often go hand in hand — confidentiality agreements and covenants not to compete (also known as confidentiality agreements.) They are found in many employment contracts with employees and may also be used in at-will relationships between employers and employees.

        At the beginning stages of employment, an employer should consider whether to bind the new employee to a confidentiality or non-compete agreement. At the termination stage of employment, the employer should review the employee’s file to ensure that there are fully executed copies of these agreements.

        Confidentiality Agreements

        Confidentiality agreements focus on the unauthorized dissemination of confidential information by current and former employees. Generally, companies have a legitimate business interest in protecting important, confidential information from landing in the hands of their competitors or other businesses that could benefit from the information. This could be a customer list, sales data, or technical knowledge. Sometimes, the data the employer seeks to protect is so important and confidential; it could be considered a trade secret, like the recipe for Coca-Cola.

        Even without a confidentiality agreement, Massachusetts law prohibits any person or corporation from converting any trade secret for its own use. The definition of a trade secret is broad, and includes any information that constitutes “secret scientific, technical, merchandising, production, or management information, design, process, procedure, formula, invention, or improvement.” If a company is found to have misappropriated a trade secret, a court may consider the company’s conduct unfair and deceptive, and award punitive damages.

        The difficulty for the aggrieved party will be in showing that the misappropriated information was a trade secret. They will have to prove, among other things, the extent to which they attempted to keep the information safe. In considering the Coca-Cola recipe, it is widely known that the formula is kept in a vault and safeguarded from dissemination.

        While Massachusetts law affords some comfort to employers regarding confidential information absent a confidentiality agreement, it is strongly advisable that employers create confidentiality agreements for their employees. These give employers the ability to define the breadth and scope of information they seek to keep confidential. A confidentiality agreement is a wider ‘net’ then the information protected under Massachusetts law and permits employers to protect information that does not fall under the trade-secret definition.

        Of course, there are certain exceptions relating to information that employers seek to keep confidential. Information that has already become public knowledge will not be considered confidential under any agreement. The confidentiality agreement not only broadens the scope of information, but also puts the employee immediately on notice regarding their employer’s attempt to keep information secret.

        If an employer has information that may not be considered a trade secret, but is critical to the business and is not publicly known, the employer should have its employees sign a confidentiality agreement. In addition, the employer should periodically remind its employees to keep the information confidential, and take steps to limit this information to key employees who need to know. This will provide some protections and, more importantly, an avenue of recourse against an employee in the event the information is used or disclosed.

        Covenant Not to Compete

        Typically, a non-disclosure or confidentiality agreement will be included in an employment contract or covenant-not-to compete agreement. A non-competition agreement is a contract between an employer and former employee that limits the former employee from competing against the employer. The three major components of a non-competition agreement are time, distance, and subject matter:

        • Time relates to the months or years a former employee must refrain from competing against his or her former employer;
        • Distance relates to the geography in which a former employee may not compete; and
        • Subject matter relates to the type of work and specific competitors.
        • Courts have typically focused on time and distance when considering the validity of a covenant-not-to-compete agreement. In one instance, a court prevented a former employee who moved cross-country from engaging in the same business as his former employer because both businesses were national. Therefore, the court concluded that the former employee would be vying for the exact same business as his former employer. As a result, the court upheld the non-competition agreement.

          Conversely, there are instances where courts are not inclined to uphold non-competition agreements because they are egregious in time and scope. For example, a court may not be inclined to uphold a non-competition agreement that prohibits an employee from working in a specific field for 10 years or from moving to a completely different region of the country and working in the same field. A court will also look to the type of business and determine whether it is national, regional, or local. In short, every non-competition agreement must be examined on a case-by-case basis.

          Massachusetts law also prevents certain professionals such as doctors and lawyers from engaging in non-compete agreements.

          In the absence of a non-competition agreement, a former employee is free to compete against his or her former employer. Therefore, it is advisable to draft and negotiate a covenant-not-to-compete agreement with key employees. While the agreement may be tested after the employee resigns, restricting the employee’s competitive activities during the term of employment is always acceptable. It is also critically important to consult with a legal professional to assist in drafting a covenant not to compete; a generic covenant is more likely to be unenforceable because it may fail to consider the specific circumstances of the employee and employer. Each agreement should be tailored to the specific employee.

          While employment agreements that include a covenant not to compete and a non-disclosure agreement benefit the current employer, a potential employer may be exposed to legal action when hiring a former employee of a competitor who is bound by a confidentiality agreement or covenant-not-to-compete agreement. The new employer may face an injunction if the former employer believes the new employer is benefiting from the confidential information.

          Both non-competition agreements and confidentiality agreements demonstrate an employer’s desire to retain strong employees and keep secret information that is vital to the business. The cost of losing a key employee to a competitor or the cost of the dissemination of a client list may be devastating to a company. While cliché, the saying “an ounce of prevention is worth a pound of cure” rings true in this context. Companies should take preventative steps to ensure that their employment agreements are properly drafted and that the provisions relating to confidentiality and non-competition are reviewed by counsel.

          Kevin V. Maltby, Esq. is an associate with Bacon Wilson, P.C. He is a former prosecutor for the Northwestern District Attorney’s Office with extensive jury trial and courtroom experience. His practice concentrates on employment, litigation, and family matters. He also handles personal injury and product liability; (413) 781-0560;[email protected]

          Sections Supplements
          New Wage-and-hour Provision Will Test Employers

          “Fresh meat for plaintiffs’ lawyers.”
          This is the colorful phrase Fred Sullivan summoned to describe employers in Massachusetts — and, more specifically, what he believes they will become after (and perhaps even before) July 13. That’s the date when new legislation regarding the state’s wage-and-hour statutes will take effect.

          In a way, the measure involves a simple change of one word in one sentence of a statute. But the shift in terms, from ‘may’ to ‘shall’ with regard to the awarding of triple damages for violations of those wage-and-hour laws, could have some serious ramifications for area employers and perhaps for the state’s economy as well, said Sullivan, a principal with the Springfield-based firm Sullivan Hayes & Quinn, which represents businesses in employment-law matters.
          “I think this sends a clear message from the Legislature to American and global businesses to put your jobs somewhere else, and essentially stay out of Massachusetts,” said Sullivan, who told BusinessWest that the new measure effectively removes any and all measures of discretion when it comes to awarding damages in such cases. And because it does, he believes it unfairly punishes employers and makes them attractive targets for plaintiffs’ lawyers.

          “This is unneeded and unnecessary,” he said, adding quickly that there have always been provisions for treble damages in cases where offenses were egregious. The new measure will punish people for making honest mistakes in an area of the law that is very complicated and dominated by “gray” areas, he continued, calling the amendment “overkill.”

          “The damnable thing about this provision is that an employer who attempts to do due diligence, who audits their practice, and who tries to the right thing … all that good faith counts for zero.”

          Pat Rapinchuck had another word to describe the measure: “draconian.”

          An employment-law specialist with the Springfield firm Robinson Donovan, she echoed Sullivan’s comments about the complexity of this area, and how easy it is, especially for small business owners, to make mistakes.

          “And now, they’re going to pay dearly for those mistakes,” she said, predicting that wage-and-hour complaints, which have been on the rise in recent years, could skyrocket. “There’s going to a lot of work for a lot of lawyers.”

          Some of that work should come — and will come — in the form of preventative maintenance, said Paul Rothschild, an employment-law specialist and chief litigator with the Springfield-based firm Bacon Wilson. He told BusinessWest that, in anticipation of the new law (and as a sound business practice), employers large and small should audit their policies and practices regarding such matters as classifying employees with regard to overtime to make sure they are in compliance with state and federal statutes, and then thoroughly train supervisors charged out with carrying out those policies.

          “People are simply going to have to pay more attention to this now,” said Rothschild, who called the new provision a “wake-up call” for all employers. “People are going to have to be more diligent … if not, they could pay a big price.”

          In this issue, BusinessWest examines the change to state wage-and-hour laws, what it means, and what business owners should be thinking about.

          Getting Clocked

          “Big Business Whacked by New Wage Act Provision.”

          That was the headline on the Mass Lawyers Weekly story announcing passage of the damages provision in April. It quoted several employment defense lawyers who, like Sullivan, predict that the measure will be so bad for business in the Commonwealth that it will give some companies reason (or another reason) not to locate here or to move out.

          Gov. Deval Patrick expressed some of those concerns in a letter he sent to legislators back in February, in which he asked for an amendment to Senate Bill No. 1059, “An Act Further Regulating Employee Compensation,” one that would add a ‘good-faith’ provision to the treble-damages clause.

          “I strongly support strict enforcement of the state wage-and-hour laws to ensure that workers are justly compensated,” Patrick wrote. “I am concerned, however, that mandating treble damages in all cases and without any exception for employers who act in good faith is unfairly punitive. Treble damages can be a significant penalty, especially in cases involving multiple plaintiffs, and such damages are neither warranted nor fair in every case, particularly in situations where the wage-and-hour issues may be complex and uncertain, and where an employer relies, in good faith, on the advice of counsel and guidance received from government authorities.”

          Legislators didn’t respond as the governor hoped, however, and the new measure passed as originally drafted. It became law when Patrick opted to neither sign nor veto it, making Massachusetts the only state to have such a provision.

          And now businesses must live with that law, said Rothschild, who told Business-West that the new damages provision essentially takes employers back to where they were several years ago, before the state Supreme Judicial Court provided a measure of discretion when it ruled that treble damages were allowed “only where authorized by statute, and appropriate where conduct is outrageous, because of the defendant’s evil motive, or his reckless indifference to the rights of others.”

          Now, there are no more questions about good faith and whether proof of same can allow an employer to avoid treble damages, said Rothschild. But there are a host of other questions.

          Such as retroactivity. Indeed, there is already ongoing debate about whether claims filed before July 13 but to be determined after that date will be subject to the damages provision. Other questions concern just how big a spike in claims should be expected — most believe it will be a large jump — and how many cases will be settled (and how quickly) because there is no discretion with regard to those damages.

          “Businesses have had all their defenses taken away from them in these kinds of actions,” said Sullivan. “And when I say ‘defenses,’ I mean not simply defenses against the violation, but defenses against excessive damages.

          “By taking away the good-faith defenses or the inadvertent action on the part of the employer,” he continued, “you’ve placed employers in a position where a mistake, a miscalculation, or a supervisor’s error now becomes the subject of an excessive-damages award.”

          And the companies that are perhaps most vulnerable, said Rapinchuk, are smaller outfits that are understandably more focused on their product or their mission than they are on management issues such as compliance with wage-and-hour laws.

          “These might be mom-and-pop operations that have grown into smaller or mid-sized companies,” she explained. “They think they’re doing everything right, and they’ve managed to stay out of trouble to this point, but they don’t know and don’t understand, in many cases, the pitfalls of running afoul of these wage-and-hour laws.”

          Trying Times

          Rothschild predicted that, when area employers start to read or hear about large settlements involving wage-and-hour violations, they will begin to act and take preventative steps. He urges them to do so now, or run the risk of being the subject of one of those settlements.

          “Businesses need to be proactive, not reactive, and need to understand that they face paying out triple damages whether the act was willful or not,” he explained. “Before, if you had an employer who, through some mistake of a bookkeeper, didn’t pay someone the required overtime for a period of time, that employer might say, ‘oops, we’re sorry, here’s your overtime,’ and that would probably be enough.

          “Now, if an employee brings a claim, and it’s warranted, the court is going to order triple damages and attorneys’ fees — without discretion,” he continued. “So there’s a lot at stake.”

          But even being proactive and working diligently to do the right thing may not be enough to effectively shield business owners from litigation, said Rapinchuk, as she referred, again, to the complexity of wage-and-hour laws and all that gray area.

          “Obviously we all want employees to be paid fairly, but this is a very difficult area of the law to fully comprehend and to do everything right,” she explained, “and to penalize people in such a way for making good-faith, honest mistakes does seem to be extreme.”

          Rapunchik cited language in the Mass. General Laws regarding exempt and non-exempt employees as but one example of how confusing these laws can be.

          There are three main categories of employees that are exempt, she explained, listing ‘executive,’ ‘administrative,’ and ‘professional’ personnel, and a host of conditions that must be met to fit into one of those categories. In the case of administrative employees, for example, in addition to earning a predetermined salary of not less that $455 per week, a person must satisfy both of the following tests:

          • the employee’s primary duty consists of performing office or non-manual work directly related to management policies or general business operations or the employer’s customers; and

          • the employee’s primary duty includes the exercise of discretion and independent judgment with respect to matters of significance.

          There are several factors to be considered when determining whether an employee does exercise discretion and independent judgment on those matters of significance, she continued, and they include “having authority to fomulate, affect, interpret, or implement management policies or operating practices,” and “carrying out major assignments in conducting the operations of the business.”

          There is plenty of ambiguity in such language, said Rapinchuk, adding that employers must do more than just read the verbiage and try to understand it.

          Sullivan agreed.

          “Employers certainly have to audit their practices,” he said. “And that means more than just looking at or reviewing the stated policy. It means sitting down with people at the worksite and asking how the policy gets applied. With respect to people exempt or non-exempt, it involves going beyond someone’s title and job description and looking at what that individual actually does.”

          Sullivan went so far as to suggest that companies bring in objective individuals, have them interview employees and listen to comments about what they do, and render opinions on whether there is compliance in each specific case.

          Taking such steps will not make a company bulletproof when it comes to wage-and-hour laws, he explained, but it will provide the equivalent of what he called a “bulletproof vest.”

          Up-to-the-minute Reports

          Summing up one likely impact of the new damages provision, Sullivan said the measure amounts to labor law specialists’ full-employment act. “This will be another gold mine for them to tap.”

          Ultimately, he believes that attorneys representing both plaintiffs and defendants should be quite busy in the months ahead with the expected increase in wage-and-hour claims.

          By changing the word ‘may’ to ‘shall,’ the Legislature has stripped employers of their defenses in such matters, thus making complaints much more appetizing to employees and the attorneys who represent them.

          And that’s why business owners have become fresh meat.

          Sections Supplements
          Supporters Cheer as Legislation Moves to Senate

          The state House of Representatives voted 119-35 on May 22 to approve a bill to guarantee safe registered nurse staffing in all Massachusetts hospitals, dubbed the Patient Safety Act.

          The measure calls upon the Mass. Department of Public Health to set safe limits on nurses’ patient assignments, prohibits mandatory overtime, and includes initiatives to increase nursing faculty and nurse recruitment. If enacted into law, Massachusetts would be the only the second state in the nation to set safe staffing limits in hospitals.

          While some prominent nursing organizations, such as the Mass. Nursing Assoc. (MNA) support the bill, others, including the Mass. Hospital Assoc. (MHA), oppose it.

          “We are committed to working with all of the stakeholders — including the business community — to make reform a success,” said Lynn Nicholas, president and CEO of the MHA. “But we share the serious concerns of Massachusetts business leaders that mandated ratios would wreak havoc on health care costs, raise health insurance premiums, and could seriously threaten to derail our achievements on reform — with no improvement to patient care. As improved technology alters the manner in which we deliver health care, we cannot afford to be wed to an outdated delivery model based on ratios. We need the flexibility to deliver care for the 21st century.”

          Conversely, John McCormack, co-chair of the Coalition to Protect Massachusetts Patients, an alliance of more than 130 of the state’s leading health care and patient-advocacy groups, said the law would have a marked effect on improving patient care in the Commonwealth.

          “We applaud the House of Represent-atives for its overwhelming vote in support of the Patient Safety Act,” McCormack said. “When enacted, this law will improve the quality of care for all patients in our hospitals and save thousands of lives.”

          The proposed legislation will now move to the Senate for consideration. In May 2006, the Mass. House of Representatives passed a similar bill, the Patient Safety Act, but it was not taken up by the Senate. The current bill is co-sponsored by state Rep. Christine Canavan (D-Brockton) and state Sen. Marc Pacheco (D-Taunton).

          “The time has come to pass this law and to protect the patients of the Common-wealth,” said Canavan. “I am so pleased that my colleagues have recognized the merits of this bill. Let’s make this the year we finally reach the governor’s desk.”

          “The Mass. Nurses Association commends the House for their courageous vote to support the Patient Safety Act,” said Beth Piknick, president of the MNA. “This bill is about patient safety. We want to thank the Legislature for recognizing the need to improve patient safety for all our citizens, and we urge the Senate to vote to support the Patient Safety Act as well. Every day we wait for this bill to pass, patients are suffering and patients are needlessly dying due to lack of appropriate nursing care.”

          Among its key components, the bill:

          • directs the Mass. Department of Public Health to develop and implement staffing standards and enforceable limits on the number of hospital patients assigned to a registered nurse at any one time;
          • requires that staffing standards be developed within 12 months of the bill’s passage and be based on scientific research on nurse staffing levels, patient outcomes, expert testimony, and standards of practice for each specialty area;
          • calls for the safe staffing limits to be implemented in all teaching hospitals by 2009, with implementation in all community hospitals by 2011;
          • allows DPH to grant waivers to hospitals in financial distress;
          • provides flexibility in staffing and accounts for patients who require more care. Once established, the staffing levels will be adjusted up or down based on patients needs using a standardized, DPH-approved system for measuring patient needs;
          • aims to reduce errors caused by fatigue and overwork by prohibiting hospitals from forcing nurses into mandatory overtime, and also prevents hospital administrators from moving nurses into unfamiliar assignments without proper orientation;
          • prevents the reduction of support services, including services provided by licensed practical nurses, aides, and technicians;
          • establishes strong consumer protections for safe RN staffing, including a prominent posting of the daily RN staffing standards in each unit; and
          • establishes a number of nurse-recruitment initiatives—sought by the hospital industry and supported by the Coalition—to increase the supply of nurses by providing nursing scholarships and mentorship programs, as well as support for increases in nursing faculty to educate new nurses.
          • It also creates refresher programs to assist nurses who want to return to practice at the hospital bedside. A survey of Massachusetts nurses found that more than 65% of those not practicing in hospitals would be likely to return if a law providing safe limits was passed.   In California, where similar limits have been in place for three years, 80,000 nurses have returned to the bedside, according to the California Board of Nursing.

            To date, 130 of the state’s leading health care and patient advocacy groups have endorsed the Patient Safety Act and have joined forces to push for its passage in both the House and Senate. Recent voter surveys indicate that more than 80% of the public supports establishing safe staffing limits.

            Sections Supplements
            There are Many Ways to Finance a Startup Business

            It is one of the often-harsh realties of the business world: While new ventures begin with an idea, they can only truly get started with money.

            Indeed, entrepreneurs and new-business owners alike are challenged by finding sources of funding during the startup phase. And unlike existing businesses with a proven track record relative to cash flow, customer base, and revenue stream, new businesses are often not profitable for at least the initial six to 12 months of operations.

            That said, a new business nonetheless faces the same economic realties of an existing business, such as the need to purchase inventory, pay employees (including a salary to the business owner until profitability is maintained), and pay rent and other ongoing expenses. In addition, new businesses often have initial expenses such as equipment purchases, capital improvement, and initial inventory expenses, which can be significant.

            What follows is a primer on determining what it will take to get a business venture off the ground, and also how to secure that financing.

            Startup Cost Estimates

            A sound business plan for a startup company should consider any and all costs that will be incurred during the startup phase of the business, and then on an ongoing basis. Initial substantial costs will likely be incurred for such things as inventory, equipment and machinery purchases, leasing and/or other real estate expenses, marketing expenses, insurance premiums, specific costs, such as franchise fees or license costs, and initial payroll costs.

            If you’re considering starting a new business, it is wise to avoid understating and underestimating your initial capital needs during the startup period. The rule of thumb should be to overestimate initial capital needs and underestimate initial business operating revenues to avoid running into budgetary deficit. Whether or not you have contemplated seeking financing through an institutional lender, commercial lenders are often an invaluable resource for you relative to evaluating your business plan. In fact, since commercial lenders often are presented with numerous business plans by potential and current borrowers, they are often uniquely positioned to understand and challenge your estimated initial capital needs. Even an informal conversation with a commercial lender would likely be highly productive.

            Once the associated needs and costs have been identified, your challenge is to identify a source to finance the startup of your business. There are a number of different forms of startup financing, including self-financing, equity financing, and debt financing.

            Self-financing

            Self-financing simply means that you fund the startup costs, drawing upon initial cash options such as savings accounts, home equity loans, retirement accounts, and other sources of liquidity. Often called ‘bootstrap’ financing, self-financing a business is the least complex and most popular form of financing new small businesses. You simply draw funds off the available liquidity on an as-needed basis, both during the inception of your business operations and during the course of your business startup period.

            You should bear in mind, however, that frequently the same funds utilized for your business will also be needed in lieu of income during the startup period. Since it takes a potentially significant period of time for most new businesses to see profitability, you will likely need to draw upon existing cash surpluses to substitute income. So, if you’re contemplating utilizing bootstrap financing, you should consider covering not only business expenses that will be incurred during the startup period, but also living and personal expenses that will arise as well.

            An alternative to bootstrap financing is seeking funding from family and friends. Not without a whole host of issues unto itself, family financing can be a cost-effective way to manage your business’s startup needs. Young entrepreneurs often seek initial loans from parents and other close relatives, with terms, conditions, and formality all determined by the circumstances. That said, even in the informal circumstance of a loan from a parent or close family relative, such a transaction nonetheless constitutes an obligation that could have other legal and/or account implications. Even loans between family members should be reflected by minimal documentation including at least a promissory note by and between the parties, and, as with all financing transactions, it should follow legal and tax consultation.

            An advantage to startup self-financing or funding by family and friends is the ability to receive funding without relinquishing equity or control. In addition, the informality of loans from relatives and family members could lend itself to flexibility otherwise unavailable with other sources of financing.

            Debt and Equity Financing

            In the case where substantial capital needs are required by your business during the startup phase, more traditional debt financing or equity financing would most likely be needed. Debt financing is essentially funds borrowed to run your business, including loans from traditional lending institutions, commercial finance companies, and government organizations, such as the Small Business Administration (SBA).

            Equity financing is a financing mechanism by which, unlike debt financing, you relinquish some portion of equity ownership in your business in return for a capital contribution. This often takes the form of an initial investor seeking stock (in the case of a corporation) or membership interests (in the case of a limited liability company), to reflect the contributor’s investment. While certainly an attractive and available option for many new-business owners, seeking equity investors should be undertaken with thorough evaluation.

            In most circumstances, you have spent quite a bit of time developing your business plan with the intent of growing a successful and prosperous business. By incurring a new equity owner, you are relinquishing control and ownership, two factors that should be thoroughly considered at the onset. Indeed, private investors in a new business venture want to understand such things as how much control he or she will have over their new investment, and will want to know how long it will take for them to recoup their investment, as well as the nature of the potential returns that they can hope to achieve.

            Angel Investors and Venture Capital

            An additional method of financing is through angel investors and venture capitalists. They are available, albeit limited, funding vehicles. Angel investors are wealthy individuals or groups of individuals who provide capital financing in return for an ownership stake and control in a new business. Venture-capital firms similarly seek to provide capital investments, often-sizable ones, in return for ownership and control, including rights such as positions on the company’s board of directors.

            In most circumstances, funding from angel investors and venture capital firms is unlikely to be available to a new business owner. Given the risky nature of these investments, most angel investors and venture capital firms look for the proven track record of an existing business seeking financing to provide some level of comfort relative to the profitability and success of the operation’s business plan. That said, while angel and venture-capital financing may not be available at the onset of the business operations, funds may be available after a period of demonstrated success.

            Traditional Debt Financing

            Unlike equity financing, traditional debt financing allows you to seek a loan without the need to relinquish ownership or control. Once a traditional business loan is paid back, there are no further obligations to the lender. This means that you will maintain ownership of 100% of your company and will benefit exclusively from its profitability on an ongoing basis. If you’re not looking to relinquish control and ownership, or incur a new business partner, traditional debt financing may be an attractive option.

            Such debt financing generally involves some type of loan facility, including a traditional lending institution and/or a government agency such as the Small Business Administration. SBA loans administered through traditional lending institutions may have the ability to offer financing with slightly fewer qualification requirements than may be required through the institutional lender without involvement of the government agency. This is possible because agencies such as the SBA may guarantee repayment of some portion of your loan.

            Institutional loans, whether or not government agency-guaranteed, will most likely be secured by some form of collateral. Often, collateral will include your personal guaranty, mortgages on your real estate, including your personal residence, and liens on business assets such as inventory and equipment. It should be noted that nearly one-half of all startup businesses seek initial financing through traditional bank loans.

            As discussed above, commercial lending officers are often an excellent resource for evaluating the strength of your initial business plan. Additionally, as your business grows, an existing track record and relationship with a bank may assist you in receiving further financing such as credit lines and large term loans.

            Even within the current economic climate, it is possible to launch a new venture. But it helps to know — and fully understand — all your options.

            Jeffrey Fialky is an associate with the law firm Bacon Wilson, P.C., specializing in business, corporate, municipal, and real estate law;[email protected]; (413) 781-0560.

            Sections Supplements
            Entrepreneurship Hall of Fame Announces Inductees
            Harry Samble

            Harry Samble, founder of Belmont Laundry, making some deliveries.

            When asked about his grandfather, Robert Samble Jr. started by pointing.

            “That’s him,” he said, gesturing toward a framed photograph sitting on a shelf in his crowded office. Somewhat faded by time, the image is of a man sitting behind the wheel of a delivery truck bearing the name Belmont Laundry, circa 1915. “That’s Harry Samble … he started all this with grandma.

            “That’s her there,” he continued, pointing to another picture, this one on a higher shelf. “She ran it for years with my father after grandpa died.

            “And that’s my father there,” he went on, pointing to a picture of a man in uniform standing next to a P-47 Thunderbolt fighter plane. “That’s from his days in the Army Air Corps during World War II.”

            When businesses stay in the same family for several generations, there are usually lots of old photographs on walls, atop credenzas, or in desk drawers, and so it is with the Western Mass. Entrepreneurship Hall of Fame’s Class of 2008. And as the saying goes, they speak a thousand words.

            Barbara Meunier has a favorite picture of her father, Rupprecht Scherff, who ran the Fort restaurant in downtown Springfield for more than 40 years until his death in 1996. The picture in question shows him in one of the dining rooms, where one would usually find him, shaking up some cherries jubilee tableside.

            “He was always working … always,” said Meunier, who now manages the Fort, known to some as the Student Prince, along with her brothers, Rudi and Peter Scherff. And there is now a third generation at work, she noted, adding that her son, Michael, is kitchen manager, and Rudi’s son (also named Rudi) recently took home his first paycheck for work in the deli.

            There is a fourth generation now working at Belmont Laundry — Samble’s sons, Matt and Derek, have lead roles — and a fifth generation continues to market Absorbine liniment and other products at W.F. Young, which was started by Wilbur Fenton Young in 1892. The company, and the Young family, have several pictures of the founder, including one with his signature followed by the letters P, D, and F. Apparently, Wilbur’s father, Charles, didn’t think much of his son’s decision to start a company making liniment for horses and, later, humans. As a condition for granting a $500 loan to help finance an expansion of the venture, the elder Young stipulated that his son pronounce himself in all advertising as “Pa’s Darn Fool.”

            Long-surviving family businesses, old photos, and the stories behind them may be the dominant theme for the Class of 2008, but there are other intriguing stories in this roster of inductees, the ninth to be enshrined.

            Baystate Health is being inducted to recognize an entrepreneurial spirit that has manifested itself in many ways, said Tom Goodrow, vice president of Economic and Business Development at Springfield Technical Community College, which created the Hall of Fame. These include many new ventures in recent years, including the D’Amour Center for Cancer Care, one of many new developments on the north end of Main Street, and a $239 million expansion, dubbed the ‘Hospital of Tomorrow,’ due to be started this fall.

            There are also the entrepreneurial exploits of Art Jacobson — who founded Olympic Manufacturing Group in Agawam, now called OMG Inc., and later founded Mr. Shower Door — and the individuals now at the helm at OMG.

            The Class of 2008 was introduced at a reception staged May 22 at the Colony Club, and the new inductees will be honored at the annual Hall of Fame dinner on Oct. 2 at the Log Cabin Banquet and Meeting House.

            Proceeds from that event will benefit the many entrepreneurship programs at STCC’s Andrew M. Scibelli Enterprise Center (SEC), said Goodrow. These include the YES (Young Entrepreneurial Scholars) program, which serves more than 1,000 young men and women in two dozen area high schools, as well as the Community Foundation of Western Mass. student business incubator in the SEC, which hosts up to nine fledgling businesses.

            Here’s a look at the Class of 2008.

            Belmont Laundry (the Samble Family)

            Before moving on to that truck, Harry Samble picked up and dropped off laundry on his bicycle and, later, a horse and buggy.

            In those days, his service was called ‘wet wash,’ said Robert Samble, noting that his grandparents would pick up laundry, wash it, and bring it back to the customer wet, to be dried on a line outside. This line of work has evolved considerably over the years, he continued, adding that Belmont now has a fleet of trucks and more than 50 employees, and handles more than 1,000 commercial accounts in a service area stretching from Newport, R.I. to Pittsfield.

            How it arrived at this state is a story of perseverance, vision, and dedication to customer service, he explained. To emphasize this point, he stopped at a pair of recently cleaned uniform pants soon to be returned to a commercial client. Turning the waist back, he revealed a radio frequency identification (RFID) tag implanted within. Each item has one, said Samble, to ensure that every shirt, pair of pants, physician’s coat, or commercial floor mat goes where it’s supposed to go.

            “The big outfits don’t do this, because it’s expensive and they don’t want to spend that kind of money on customer service,” he said, adding that Belmont has been taking such steps since Harry and Corrine Samble set up shop in 1907 in a barn on the location where the headquarters building still stands today.

            Harry Samble died when his son, Robert, was only 14, pressing the second generation of the family into a large role within the business at an early age. For many years, Robert Samble and his mother ran the business, along with one of Harry Samble’s brothers, who was later bought out.

            Robert Samble Jr. is a little sketchy on some of the history, because he never met his grandfather and his father died in 1967, when Robert was just 14. It was then that Robert’s mother, Dorothy, who had not been involved in the business at all while her husband was alive, essentially took over and kept the doors open.

            “If it wasn’t for her, we wouldn’t be here today,” said Robert, adding that, in 1973, his mother was able to convince him to change careers (he had been a refractory mason) and join the family business.

            Since then, he has orchestrated significant growth — the company has added locations in Agawam, West Springfield, Longmeadow, and a second store in Springfield — and diversification. He’s been joined in the business by sons Matthew, now project manager, and Derek, the dry-cleaning division manager, and stepdaughter April Caruso, who is supervisor of counter staff.

            Commercial work, which now accounts for roughly 75% of Belmont’s business, remains strong, said Samble, but the retail side of the ledger has been soft in recent years, a trend he attributes to more-casual dress in the workplace, among other factors.

            “People aren’t dressing up like they used to,” he explained, adding quickly that the company will persevere, whether that trend changes or not. It has endured for 101 years because it’s been able to add new wrinkles — or iron them out, as the case may be.

            The Fort Restaurant

            There are a few pictures of Rupprecht Scherff on the walls of the Fort, providing a continuing presence for the individual credited with making the restaurant a Springfield institution and popular stop for the business community.

            But it is the work of two generations, and now a third, that has enabled the venue to persevere for 73 years, a very rare feat in the challenging restaurant business.

            The Fort is known for many things, including its two names — ‘Student Prince,’ taken from a Sigmund Romberg operetta about student life in Heidelberg, and ‘the Fort,’ the name given the main dining room, in recognition of the fort John Pynchon built on the site in 1660 — and also an extensive collection of beer steins, its veal shank, scrod, and Roquefort salad dressing.

            It all started back in 1935 with Paul Schroeder, a native of Germany and cigar maker by trade. After working at several area cigar factories, he took a job as the housemaster of the Springfield Turnverein, a German club that continued to serve its members libations during Prohibition. After repeal of the Eighteeth Amendment in 1933, Schroeder saw an opportunity to start his own business, and did so, partnering with Erna Sievers in the Student Prince restaurant on Fort Street.

            Rupprecht Sherff would eventually take a job there in 1949. He came to the U.S. from Germany years earlier, at the behest of Robert Jarhling, owner of the Highland Hotel in Springfield, whom Scherff had impressed while he waited on Jarhling and his wife when they were visiting Bremen. Scherff worked at the Highland for many years and later fought in World War II before coming to the Student Prince. He started in the kitchen and was eventually asked to manage the restaurant. When Sievers died in 1961, she left the establishment to Scherff and another employee, Tante Grete, whom Scherff bought out in 1971 to assume sole ownership.

            Barbara Meunier said she and her brothers practically grew up in the restaurant, eventually handling every job in it. Rudi started when he was 8, and was officially on the payroll at age 12. Barbara, meanwhile, started at 14. Neither thought they would make the Fort their career, but after trying other pursuits — Rudi practiced law in Springfield for several years — they gravitated back to Fort Street.

            Today, they split the various responsibilities involved with day-to-day operations — Meunier handles most office duties; Peter, who has an MBA, handles most financial aspects of the business; and Rudi takes care of the kitchen and the menu — and continue many traditions started by their father, such as Octoberfest, Mayfest, a wild game festival, and elaborate decorations for the holidays.

            They’ve also brought the third generation into the business, which, says Meunier, has the same work ethic as the man in all the pictures.

            Baystate Health

            Andrew Scibelli, president emeritus of STCC and chair of the steering committee for this year’s induction ceremonies, acknowledged that Baystate Health is a different kind of selection for the Hall of Fame.

            Rather than acknowledging one individual or several members or generations of one family, the selection of Baystate constitutes recognition of an entrepreneurial philosophy that pervades the system and its more than 10,000 employees, said Scibelli.

            “They’re not just running a hospital there,” he continued. “They’re being entrepreneurial in every aspect of that word; they’re looking for opportunities, they’re taking risks in some cases, and they’re taking steps that will benefit themselves and the community they serve.”

            Elaborating, he said there have been many examples of this over the years, and especially the past decade or so. Endeavors include a number of ventures on Main Street, several blocks from Baystate Medical Center, with most of them involving former mill complexes that were either rehabbed or replaced with new construction.

            These include the D’Amour Center for Cancer Care, the region’s only free-standing, multi-disciplinary cancer treatment facility, opened in 2002, and the Pioneer Valley Life Sciences Institute, a joint venture between Baystate Health and UMass Amherst that was created in 2004 to develop new approaches for the diagnosis and treatment of disease.

            Other examples include the expansion of the health system to include Baystate Franklin Medical Center and Baystate Mary Lane Hospital, and the system’s involvement in the creation of the for-profit health maintenance organization Health New England, in which it still owns a majority interest.

            The most recent, and soon to be most visible, example of Baystate’s entrepreneurial drive is a $239 million expansion project, the ‘Hospital of the Future,’ a nearly 600,000-square-foot complex that will replace some of the hospital’s older facilities with new, state-of-the-art patient-care areas that administrators say will directly address the needs of an aging population.

            The expansion is perhaps the largest in the history of the system, which can trace its roots back to 1883 and the opening of Springfield Hospital. In 1974, what was then known as Springfield Hospital Medical Center merged with its neighbor, Wesson Women’s Hospital, to create the 672-bed Medical Center of Western Mass. In 1976, this entity merged with Wesson Memorial Hospital, located about two miles away. The merger established Baystate Medical Center, then the second-largest hospital in New England, with 1,036 beds.

            In 1983, Baystate Medical Center was reorganized into three separate corporations: Baystate Health Systems, the parent corporation now renamed Baystate Health; Baystate Medical Center; and a for-profit corporation known as Baystate Diversified Health Services.

            The Baystate Health family has grown significantly since its inception. In 1986, Baystate Franklin Medical Center in Greenfield joined Baystate Health; in 1991, Baystate Mary Lane Hospital in Ware joined the health system. In 1996, the Visiting Nurse Association & Hospice of Pioneer Valley, now renamed the Baystate Visiting Nurse Association & Hospice, also became a member of Baystate Health.

            Through all the additions and name changes, the system has been consistently entrepreneurial in its approach to doing business and serving the community, said Baystate President and CEO Mark Tolosky.

            “In the fast and ever-changing health care environment, we must be nimble and responsive to the needs of our patients and our communities, and assure them that we are stewards of all of our resources, and with that comes the need to be visionaries and risk takers,” he said. “One example of our entrepreneurial spirit at Baystate Health aligned with vision and risk relates to North Main Street in Springfield.

            “Just over 10 years ago, the land sat silent, with vast, empty buildings — once home to robust manufacturers of hand tools and much more,” he continued. “The leadership of Baystate Health saw opportunity, and we invested $125 million to develop this Northern Edge Medical campus. Our lead role has led to significant private investment in the area. Now, we see a vibrant complex — with health care at its core — and with other businesses benefiting from the spin-off effects of this development.

            “The vision we had became a reality and there’s more to come.”

            W.F. Young

            Wilbur Young was selling pianos in the early 1890s, and doing rather well at it, when he started looking for a different, more entrepreneurial career opportunity.

            He found one through his love of horses — and some encouragement from his new bride, Mary Ida. The product that Wilbur developed, and that the couple made in a tub in their farmhouse kitchen, would come to be called Absorbine Veterinary Liniment. A blend of herbs and essential oils, the liniment would keep a horse from going lame while gently reducing swelling and stiffness.

            More than 116 years later, the liniment remains the flagship brand marketed by W. F. Young Inc., a company credited with coining the phrase ‘athlete’s foot’ and, over the years, developing a wide array of health care products. Today, the company, which, after spending most of its existence in downtown Springfield, moved to East Longmeadow in 2000, is a global marketer of products for humans and animals.

            The company, which started small, really began to grow when farmers discovered that Absorbine Liniment worked on humans, as well, said Tyler Young, its CEO, president, and fourth-generation manager. Using the original formula as a basis with some changes and
            efinements, Wilbur created a liquid for human use, called it Absorbine Jr. Antiseptic Liniment, and brought it to the marketplace in 1903.

            As demand increased, the original manufacturing operation in Meriden, Conn. proved insufficient, said Tyler Young, adding that his great-grandfather went to his great-great-grandfather and secured a loan — and its unusual condition. The company grew steadily over the years, adding some celebrity spokespeople — Hall of Fame pitcher Walter Johnson and Triple Crown champion Secretariat’s trainer, Lucien Lauren — while also adding ‘athlete’s foot’ to the lexicon in the 1930s.

            The company typically introduces between five to 10 new products a year, said Tyler Young, adding that recent additions include DuraGuard® and Bug Block® insect repellents for horses, the innovative Stall Safe® brand disinfectant and sanitizer for stables and stalls, and Myoplast®, an amino-acid supplement which helps provide strength and stamina in horses while supporting lean muscles.

            More than a decade ago, the company transitioned out of manufacturing and now bills itself as a virtual marketing company, Young continued. Production of the entire network of brands is outsourced throughout the U.S.; the operations department manages production from the company’s East Longmeadow headquarters. After 80-plus years in Springfield, the company moved to its new offices in the East Longmeadow Industrial Park in 2000.

            Art Jacobson and OMG Inc.

            He called it the “roofle.”

            That’s the name Art Jacobson came up with for a new product he contrived back in 1981 to suit the needs of one of his clients.

            At the time, Jacobson was a manufacturer’s representative for companies that made bolts, rivets, and screw-machine parts, among other things, and selling to companies like Hamilton Standard, Pratt & Whitney, and Electric Boat. He was calling on a client that made commercial roofing systems when a discussion ensued that would eventually lead to what Jacobson called a “fluke of a business,” and what has become one of the region’s most intriguing entrepreneurial success stories.

            “I was selling him long screws to fasten his roofing down to concrete decks,” Jacobson recalled. “He said that if I came up with a different kind of fastener, like a long toggle bolt, he could use it to fasten roofing down to lightweight concrete decks where a screw wouldn’t work.”

            One of the companies Jacobson represented made long bolts that he sold to a wooden-rail manufacturer. He borrowed some, took them to a hardware store in Springfield, and put toggle wings and large washers on them. He then took them back to his roofing-industry client, who pronounced them exactly what he was looking for.

            Thus, the Olympic Manufacturing Group was born, only it would be several more years before it would be called that — and before it did any manufacturing.

            After securing a patent for his roof toggle, or ‘roofle,’ Jacobson took out an ad in a national roofing trade publication which touted the product and its potential. And calls started coming in. Still at his sales job and with no inventory on hand, Jacobson started having the roofle made for him to fill those orders, and, in so doing, moving more quickly than most entrepreneurs would in taking a venture off the ground.

            “I found myself getting into a business I really knew nothing about,” he explained. “Most entrepreneurs will investigate to the hilt or work on a product for six months or a year before deciding whether to take it to the market. Not me; I sort of fell into it.”

            Fast-forwarding somewhat, Jacobson said he would have long bolts shipped to him, add the toggles and other features that converted them into roofles, and run back and forth to Bradley International Airport to ship them out. Eventually, he and his wife, Esther, rented out 250 square feet of space to operate the venture, and by late 1982, they had decided to go into business together.

            Within a few more years, Olympic would become a manufacturer of roofing fasteners, and by 1985 it would be No. 1 in the industry.

            Jacobson said the key to the company’s steady growth within the Agawam Industrial Park was hiring the right people, individuals such as Hugh McGovern, who would later become president of Olympic (later to be called OMG), after Jacobson sold it; Dan Murphy, who eventually would become president of a succession of larger owners of OMG; and Tom Wagner, OMG’s senior vice president.

            “We succeeded because I surrounded myself with people better than me,” he explained. “They took the company to places I couldn’t.”

            Jacobson described his sale of Olympic in 1994 as the “quintessential win-win,” and both parties would go on to write more success stories.

            After “chasing the grandkids around for several years,” as he put it, Jacobson started Mr. Shower Door in 2005. He’s tripled sales since them, and now has three locations.

            Meanwhile, OMG continues to grow, organically and through acquisition. The most recent example was the purchase and assimilation of Illinois Tool Works (ITW), Buildex’s roofing business segment, which is now known as OMG West.

            Today, total sales are approaching $150 million. Not bad for a “fluke of a business.”

            George O’Brien can be reached at[email protected]

            Sections Supplements
            FieldEddy Strives to Grow Its Family and Strengthen Its Brand

            Sam Hanmer says it was nothing personal, and certainly not a knock on one of the company’s early executives.

            No, the decision to drop ‘Bulkley’ — as in Chester B. Bulkley — from the corporate name Field Eddy & Bulkley was taken in an attempt to shorten and simplify things, and also to help strengthen the brand.

            The new name on the letterhead and business cards — FieldEddy Insurance — is what most people have called the company for some time anyway, said Hanmer, its long-time president. “When they did include Bulkley they would usually mispronounce it and come out with ‘Buckley,’” he explained. “And besides, it was a real mouthful for our receptionist.”

            In dropping ‘Bulkley’ and the ampersand from the name over the door, the company is following the lead of law firms and accounting firms, said Hanmer, adding quickly that the change is one of the smaller, more cosmetic steps being taken in an ongoing brand-building endeavor.

            Other, more significant steps include consolidating three offices into a recently constructed office complex at 96 Shaker Road in the center of East Longmeadow. There, FieldEddy occupies 10,000 square feet, and can operate — and communicate — far more effectively than it could in separate facilities in downtown Springfield, East Longmeadow, and Windsor Locks, Conn.

            “Add up the square footage in the other three locations, and it’s a lot less than what we have now,” said Hanmer as he led a tour of the new facilities, “but we can do a lot more here because it’s much more efficient space; we can communicate much better because we’re all on one floor.”

            ‘More efficient’ and ‘better communication’ are words you hear quite frequently within this organization these days, as the company, which has been expanding through acquisition and organic growth in recent years, continues work to build and strengthen what Hanmer and partners Tim Marini and Michael Coffey all call a “network” of agencies.

            Indeed, while the search continues for possible acquisition targets — “there are some potential opportunities we’re looking at and talking to,” said Hanmer — there are broad efforts underway to build the FieldEddy brand.

            The new name and logo are part of this effort, as are some marketing initiatives, said Marini, but the bulk of the work involves taking a host of agencies now under the FieldEddy umbrella — Remillard Insurance in South Hadley was the latest addition — and making full use of the benefits, or clout, that this growing family provides.

            Some of the agencies have been rolled into FieldEddy and have taken that name, while others, including Remillard, have kept their names because of the equity held in them. Whatever names they take, the individual agencies can now represent a large number of carriers, just one of the benefits of size gained through this network. And this presents opportunities during an intriguing time for the industry — one in which profound change in auto-insurance regulations enables consumers to shop for options as perhaps never before.

            In this issue, BusinessWest looks at the continued growth of FieldEddy, the process of building a true network of agencies, and the strategic initiatives being taken to make that network wider and stronger.

            Calculated Risks

            As he referenced the auto-insurance reform steps taken recently, which shift the state from what was a fully regulated system to something called ‘managed competition,’ Hanmer did so rather reluctantly. So much has been said and written about the changes he was getting tired of hearing himself talk about it.

            But he did say that most of the marketing and branding initiatives taken by the company have come in direct response to those changes — which have brought new carriers into Massachusetts, such as Liberty Mutual — and in an effort to capitalize on all those opportunities they present for companies with the requisite wherewithal.

            “The good news is that we’re big enough to have multiple options for customers,” he said, adding that, through this strength in numbers, coupled with more-aggressive marketing, which has been an industry-wide trend, the network has added significantly to its books, or book of business. “We’ve certainly had an increase in opportunities, and we’ve come out on the winning side in a lot of those, if not most of those.”

            And there could be many more of these triumphs ahead as competition increases, which all observers expect it will, and consumers gain still more options.

            “Smaller agencies are going to have a very difficult time if they can’t offer more than one or a few options to consumers,” Hanmer explained. “And it’s only getting worse for them as it gets better for the customer.”

            Summing up the events and the initiatives of the past 18 months or so, Hanmer said they were efforts to make FieldEddy stronger, or much stronger, as the case may be, than the sum of its parts.

            And there are many parts.

            Indeed, the network now includes Curtis Hodskins & McKelligott Insurance Agency in Monson, which is actually a collection of smaller agencies in the Palmer-Monson area; Remillard, which was acquired about 18 months ago when FieldEddy prevailed in spirited competition to obtain that brand; Your Choice Insurance Agency in Ludlow; and the Meadows Insurance Agency in East Longmeadow, which is now under the FieldEddy name.

            These acquisitions were all part of a broad, five-year strategic plan for the company which Hanmer formulated in 2003, that called for tripling sales from $30 million to $100 million. While FieldEddy is closing in on that goal — the Remillard acquisition brought it much closer — Hanmer admits that the bar has been moved much higher than its original height.

            Which is why he continues to search for acquisition opportunities, and why the firm embarked on his brand-building, network-building campaign.

            “Historically, we had run those agencies we acquired as separate and distinct operations, with FieldEddy mostly staying behind the scenes,” he explained. “By identifying ourselves as a network of agencies, we can better serve our customers, who will know that they can go to any one of those locations and receive the same services and options.”

            Marini agreed. “Some of what we’ve done is a bit of a reaction to the auto-insurance reform, but it’s basically good, common sense,” he explained. “This gives us the opportunity to put all our carriers in each office; in the past, we would buy an agency and essentially leave it alone with its carriers and sprinkle our carriers in a little bit.

            “Now, we have all our carriers in all our locations,” he continued, “so that every customer has options, and plenty of them.”

            And these options are adding up to growth opportunities for the network, he said, referencing recent performance, not only with auto insurance, but across the board in both residential and commercial lines.

            He attributes that growth not merely to the availability of options for consumers, but also the incorporation of the FieldEddy culture, which is grounded in strong customer service, in those agencies that have been acquired.

            Moving forward, the company intends to capitalize fully on the many assets present in the FieldEddy network. This includes, said Coffey, the names and the people behind those agencies that have been acquired, the benefits that come with the size and flexibility gained over the years, and even what the partners call a unique demographic advantage in its staff.

            Elaborating, Marini said FieldEddy has a number of women working in the field and behind the scenes — a percentage of the overall staff that is much higher than industry norms.

            “It wasn’t anything we planned — our strategy has always been to hire the best people available,” he explained. “But now that it’s happened, we can see it’s a great asset for us; we’ve seen a very favorable response from the marketplace because there’s a lot of women-owned businesses out there.”

            The space at 96 Shaker Road provides room for further expansion, said Hanmer, who told BusinessWest that he expects this to happen, both through more organic growth and additional acquisitions.

            “We don’t stop when enough is enough,” Hanmer of the company’s growth spurt and the prospects for more of the same. “There are a few acquisition opportunities that we’re talking about, and we will continue to be very inquisitive, to say the least.”

            Recent expansion efforts have taken the company further east from its roots, into the Quaboag region, and south, into Northern Conn. The next step could be to go farther east in Massachusetts, to the Worcester area and perhaps beyond, said Hanmer.

            The name FieldEddy isn’t known there, he acknowledged, but given the options it can present to potential customers, “we can make it known, and quickly.”

            Growth Policy

            For the record, the ‘Field’ in the company name is Henry Field, a prominent Springfield businessman who, in 1925, put his name and that of partner Schuyler Eddy on a venture that could trace its roots to the start-up of the Springfield Fire and Marine Insurance Company in 1849.

            Chester Bulkley, a graduate of Yale University and the brother of James Bulkley, a founder of the Springfield law firm of Bulkley, Richardson and Gelinas, would soon join Field and Eddy in the business.

            Hanmer told BusinessWest that, while Bulkley is now longer on the letterhead, his contributions to the company have certainly not been forgotten. His name was dropped in one of many steps, small and large, to help build and strengthen what has become an insurance network, one that has made continued growth its main policy.

            Mr. Bulkley would certainly understand.

            Departments

            The following is a compilation of recent lawsuits involving area businesses and organizations. These are strictly allegations that have yet to be proven in a court of law. Readers are advised to contact the parties listed, or the court, for more information concerning the individual claims.

            CHICOPEE DISTRICT COURT

            Hebert W. Bacon v. Everett G. Bacon Jr. & H & E Associates
            Allegation: Breach of contract: $31,194
            Filed: 4/24/08

            FRANKLIN SUPERIOR COURT

            Mackin Construction Company Inc. v. Berkshire Material Corporation
            Allegation: Non-payment of goods sold and delivered: $48,023.60
            Filed: 4/28/08

            GREENFIELD DISTRICT COURT

            Dorchester Industries Inc. v. RPM Technologies Inc.
            Allegation: Non-payment of goods sold and delivered: $11,558.62
            Filed: 4/15/08

            Solid Waste Solutions Inc. v. Town of Franklin
            Allegation: Amount due under contract for removal of yard waste: $25,000
            Filed: 4/11/08

            HAMPDEN SUPERIOR COURT

            Dauphinais & Son Inc. v. GFI Longbrook, LLC
            Allegation: Non-payment of goods sold and delivered: $45,411.96
            Filed: 4/22/08

            International Bulb Company Inc. v. Grandview Farms Inc.
            Allegation: Non-payment of goods sold and delivered: $66,491.40
            Filed: 4/22/08

            J.D. Contracting Inc. v. Whiteway Construction Corporation, Town of Cummington, and Hanover Insurance Group Inc.
            Allegation: Non-payment of sub-contracting services provided for construction project: $73,000+
            Filed: 4/08/08

            JPS Elastomerics Corporation v. Liberty Roofing Center, LLC
            Allegation: Non-payment of goods sold and delivered: $73,399.27
            Filed: 4/11/08

            Leaf Funding Inc. v. Medequip Inc.
            Allegation: Damages resulting from breach of equipment lease contract: $44,285.45
            Filed: 3/31/08

            NORTHAMPTON DISTRICT COURT

            United Natural Foods Inc. v. Blue Moon Grocery Inc.
            Allegation: Non-payment of goods sold and delivered and breach of contract: $106,156.94
            Filed: 4/22/08

            HAMPSHIRE SUPERIOR COURT

            Hampden Housing Associate, LP v. Whiting Oil Corp.
            Allegation: Claims for release of environmental contamination: $100,000
            Filed: 4/25/08

            Newstress Inc. v. Barr & Barr Inc. and Mount Holyoke College
            Allegation: Balance due for services and materials provided and breach of contract: $217,820.79
            Filed: 4/17/08

            Loring Michael Caney Jr. v. the Commonwealth of Massachusetts and University of Massachusetts
            Allegation: Personnel action involving wrongful termination: $52,000
            Filed: 4/24/08

            SPRINGFIELD DISTRICT COURT

            Mercy Medical Center v. Five Star Transportation Inc.
            Allegation: Unfair and deceptive business practices and non-payment of debt: $7,490
            Filed: 2/04/08

            MVA Center for Rehabilitation v. Encompass Insurance Co.
            Allegation: Non-payment of medical bills: $8,299.45
            Filed: 2/05/08

            TD Banknorth v. Berkshire Frameworks
            Allegation: Non-payment of promissory note: $8,644.86

            WESTFIELD DISTRICT COURT

            Royal Plaza Textiles Inc. v. Canadian Cozies
            Allegation: Non-payment of goods sold and delivered: $8,537.98
            Filed: 4/16/08

            Sections Supplements
            Crystal Meth Offers a Dangerous High

            Asked what age groups are the biggest users of ‘crystal meth,’ James Leyden thought for a moment.
            “I’d say a lot of drugs these days have an 18-to-55 range, some even starting younger,” he said. “Of course, I don’t know who’s making it to 55 using this. It’s a devastating drug.”

            It’s also gaining in popularity throughout much of the U.S., although not particularly in Western Mass. — yet.

            “It has kind of been working west to east,” said Leyden, program manager of inpatient substance abuse services at Providence Hospital in Holyoke. “It’s a huge problem in the Southwest and Midwest, particularly cities like Chicago and Cincinnati, and we understand it’s now a problem in Boston, but it hasn’t quite made it here yet — but we’re anticipating its arrival.”

            Crystal methamphetamine, simply put, is the most powerful form of speed available. It’s an amphetamine that excites the brain and nervous system by releasing dopamine into the body.

            As a regulated pharmaceutical product, meth is available in tablet form. But on the street, manufactured in makeshift laboratories, the drug is sold either as an injectable or snortable powder or a smokeable crystal form. All three delivery systems promise a powerful high quickly, but the effects from smoking crystal meth come especially fast, crashing into the brain within 10 seconds.

            “The high lasts a long time,” said Robert Azeez, clinical supervisor of the Carlson Recovery Center, an affiliate of Baystate Health. “It creates an extended period of feeling euphoric, but with a great amount of energy; you can stay up for days at a time under the influence.

            “But,” he was quick to add, “it also impairs your thought process, so people using it are now engaging in riskier behaviors over a longer period of time” compared to other drugs.

            Health risks, however, are many, ranging from irritability, nervousness, insomnia, nausea, and depression, to severe tooth decay — when smoked, meth destroys the enamel of the teeth — and also cardiac distress, significant cell damage in the brain, and even some unpredictable psychiatric symptoms when trying to withdraw from the drug. And its addictive qualities can be merciless.

            “The way I’ve described crack cocaine vs. alcoholism is, alcoholism is like riding an escalator into the basement, while crack cocaine is like falling down an elevator shaft,” said Leyden. “Well, meth is an even quicker and more precipitous fall.”

            In this issue, BusinessWest explores why more Americans are taking the plunge, and what health and government officials alike are doing to stop the spread.

            Rock and a Hard Place

            According to Azeez, hardcore crystal meth users may stay on the drug for three to four days at a time, with effects ranging from poor nutrition and hygiene to life-threatening health risks — as well as harm to relationships. “

            There has been a lot of published research on the damaging effects to individuals and families,” he noted. “We’ve seen a lot of media attention paid to this subject because it has become a significant problem in this country.”

            So serious, in fact, that the federal government took steps to curb illicit purchases of pseudoephedrine, a key raw material in meth production, by making it more difficult to buy medications that contain the ingredient, such as Sudafed and Claritin-D

            “Unlike other drugs that have to be smuggled in from outside the country, and are typically distributed in urban areas, this drug is made in laboratories using many ingredients you can buy at the drugstore or online,” said Leyden.

            As a result of this accessibility, the federal Combat Methamphetamine Epidemic Act of 2005, which took effect in September 2006, requires drugs containing pseudoephedrine to be sold behind the counter only at pharmacies. In addition, purchasers are limited in how much they can buy in a given month, and the pharmacy must record the purchase information in a log and keep that information for two years.

            Azeez noted that pharmacies in Massachusetts had been proactive about pseudoephedrine sales even before the federal requirements kicked in, and together those restrictions might have contributed to the relatively small size of the crystal meth problem in the Commonwealth — at least compared to other regions of the country.

            “Massachusetts has done a good job with the law change, making it difficult for consumers to purchase medicines over the counter at places like CVS or Wal-Mart that are used in the primary production of crystal meth,” said Azeez. “That has prevented labs from popping up in Massachusetts, so that, while meth is a huge problem in the Midwest, we haven’t seen it as much here.”

            By that, Azeez meant that treatment facilities like the Carlson Center aren’t seeing a high volume of patients reporting crystal meth use.

            “In order to use the substance, you have to have supply, and from what we know about crystal methamphetamine labs in this region, there’s not a lot of supply. It’s much cheaper to use other drugs, such as heroin and crack cocaine, so we’re not seeing as much incidence as they are out there, at least in terms of people accessing treatment.”

            Boston, however, is a different story, said Azeez, noting that crystal meth has become a popular ‘club drug,’ particularly among gay men. In fact, Fenway Health Center in Boston, which specifically targets the gay, lesbian, and transgendered community with its health and wellness programs, has a treatment program specifically set up for crystal meth users.

            “So often, guys wait to seek treatment until they’ve hit rock bottom and are only a shadow of their former selves,” said Wil Halpin, a clinical social worker at Fenway. “My worry is that people don’t always know the risks involved when starting to use crystal and how insidious the addictive cycle can become. It is one of the faster addictions out there, and one of the hardest to break.”

            Exploding Problem

            Addiction isn’t the only reason why crystal meth labs are dangerous, however. “You can be blown up in a laboratory — it’s been known to happen,” Leyden said, adding that the risk typically doesn’t deter someone with the know-how and desire to make the drug. “It’s not something everyone can do, but it is something you can learn to do. People find the instructions online, just like you can learn to make a bomb online.”

            Unfortunately, more people are trying their hand, and it’s frightening to think of labs gaining a foothold in any community, because they can supply a steady stream of drugs that doesn’t rely on imports. Unlike commercial methamphetamines, which have some medical uses, said Leyden, crystal meth is strictly made for illicit use.

            “It’s a much more efficient delivery mechanism, and the drug itself is more powerful” than simple methamphetamine, Leyden said. “Therefore, it hits the pleasure centers of the brain with full force.” It also produces a powerful recall effect in the brain that brings on strong psychological cravings even before a user is physically addicted. “It’s an — well, I don’t want to use the word ‘evil’ — but it’s a diabolical drug.”

            Halpin said the comedowns from a weekend of crystal meth use can be so devastating that users start taking small hits at work to get them through the week without an emotional crash. “Before long it’s a daily ritual,” he said. “Crystal is suddenly taking over their lives, and they don’t even realize it.”

            Leyden cited the story of a woman who was ironing clothes when she heard her mailbox lid slip, reminding her that a check might be in the mail. “She immediately set down the iron, called her next-door neighbor, asked her to watch her child, and dialed her dealer’s pager number” — all of it in a sort of trance, more like stimulus-response than a series of rational decisions.

            “Crack addicts talk about how powerful the first memory of taking the drug is, how they’re forever chasing that first memory,” said Leyden. “It’s much the same with crystal meth. That’s how powerful this drug is.”

            Departments

            The following is a compilation of recent lawsuits involving area businesses and organizations. These are strictly allegations that have yet to be proven in a court of law. Readers are advised to contact the parties listed, or the court, for more information concerning the individual claims.

            CHICOPEE DISTRICT COURT

            Capital One Bank v. Past Perfect Antiques
            Allegation: Default on contract: $7,111.98
            Filed: 3/17/08

            FRANKLIN SUPERIOR COURT

            Ronnie & Robin Chamberlain v. Nova Star Mortgage Inc. & Saxon Mortgage Services Inc.
            Allegation: Wrongful foreclosure of property: $25,000
            Filed: 3/25/08

            GREENFIELD DISTRICT COURT

            Fleetpride Inc. v. Eastern Weatherization Inc.
            Allegation: Non-payment of goods sold and delivered: $3,886.50
            Filed: 4/8/08

            HAMPDEN SUPERIOR COURT

            Deaton Industries Inc. v. Trident Alloys Inc. and Galaska Partners, LLP
            Allegation: Non-payment of services, labor, and materials: $31,376
            Filed: 2/7/08

            Innovative Roofing v. Northeast Interiors Inc.
            Allegation: Non-payment of services rendered: $119,626.93
            Filed: 3/18/08

            John C. Otto Company Inc. v. Hartford Stamp & Office Works
            Allegation: Non-payment of goods sold and delivered: $100,000
            Filed: 3/3/08

            Joseph and Rita Selah v. Dixon Inc. and Northeast Stucco Inc.
            Allegation: Breach of contract and negligence and personal injury: $1,011,289
            Filed: 3/17/08

            HAMPSHIRE SUPERIOR COURT

            Wendy Dixon v. 1st Advantage Dental
            Allegation: Breach of contract for dental services and non-payment of wages: $75,000
            Filed: 4/3/08

            NORTHAMPTON DISTRICT COURT

            E. O. Ross Electric Contractors Inc. v. Southern New England Spice Company
            Allegation: Non-payment of goods sold and delivered: $5,241.09
            Filed: 4/7/08

            PALMER DISTRICT COURT

            Debbie’s Cookin’-Caterin’ v. TDWF Inc.
            Allegation: Breach of agreement to reimburse for restaurant kitchen hood and fire suppression system: $8,826.34
            Filed: 3/27/08

            SPRINGFIELD DISTRICT COURT

            A. Boilard & Sons v. BSF Construction Inc.
            Allegation: Non-payment of goods sold and delivered: $39,845.17
            Filed: 1/29/08

            Complete Disposal Company Inc. v. Al Leger Home Improvement
            Allegation: Non-payment of trash removal and disposal services: $19,439.70
            Filed: 2/25/08

            Czar Distributing Inc. v. Regal Homes & Development Corporation
            Allegation: Non-payment of goods sold and delivered: $9,619.62
            Filed: 1/18/08

            WESTFIELD DISTRICT COURT

            Wells Fargo Bank v. The Dragon Lair
            Allegation: Non-payment on a business line of credit: $22,462.06
            Filed: 3/7/08

            Departments

            The following Business Certificates and Trade Names were issued or renewed during the months of April and May 2008.

            AGAWAM

            Odds N’ Ends
            23 Editha Ave.
            Jason Broussard

            Sabrina’s Pizzaria
            4 Southwick St.
            Daniel Loftus

            AMHERST

            Hospice of Hampshire County
            1165 North Pleasant St.
            Friends of Hospice House Inc.

            CHICOPEE

            Aerys Electrolux
            104 Edbert St.
            Eugene Looney

            Agnew Quality Painting & Staining
            33 Oliver St.
            Val Shvetson

            Anything Goes
            29 Mt. Royal St.
            Steven E. Humel

            Dunkin Doggies
            205 Chicopee St.
            Laurie A. Holland

            Iona Holdings, LLC
            248 Springfield St.
            Scott D. Crosson

            Wilson Market & Sales
            95 Washington St.
            Grant H. Wilson

            EASTHAMPTON

            In & Out Cleaning Service
            29 Mt. Tom Ave.
            Brandon R. Learned

            Reasonable Lawn Care
            39 Sterling Dr.
            Brian Ross

            Sisyphus Woodworking Inc.
            One Cottage St.
            Greg Larson

            Valley Vascular
            2 Mechanic St.
            Zubin Irani

            EAST LONGMEADOW

            Casa Café
            520 North Main St.
            Antonio & Amerinda Coelho

            N2 Construction
            15 Benton Dr.
            Nathan Nadeau

            Set In Concrete
            89 Pine Grove Circle
            Timothy Sirard

            HOLYOKE

            Artsee
            233 Maple St.
            Sylvia Robello

            H.M. Spencer Company
            78 North Canal St.
            Daniel Johnston

            Oasis Dance Fitness
            187A High St.
            Darlene M. Sattler

            Personal Touch Caterer
            2 Country Club Dr.
            Susan Peloquin

            Renaissance Manor
            279 Cabot St.
            Stuart Dindeman

            Tony’s Tech Auto Repair
            580 South St.
            Anthony Elias

            V&J’s Mini Market
            149 Suffolk St.
            Samuel Aviles

            LONGMEADOW

            Baby Joia
            3 Herbert St.
            Heidi Kelly

            Keller Williams Realty
            66 Dwight Road
            Laura Stevens

            Lynn Katz Photography
            407 Bliss St.
            Barbara Katz

            LUDLOW

            Jesko Machine
            State St.
            Zdzislaw Kowalski

            The Tailored Touch Massage Therapy
            314 Sewall St.
            Lori E. Jones

            NORTHAMPTON

            Antiques Corner
            5 Market St.
            Louis Farrick

            Communications Angle
            26 Center St.
            Michael Kusek

            Every Pet’s Dream
            94 Pleasant St.
            Jessie Byrnes

            Healthy Lifestyles
            43 Center St.
            Victoria Ahrensdorf

            HomeWorks
            18 Ridgewood Terrace
            Lori Steiner

            The Celadon Studio
            2 Conz St.
            Malea Rhodes

            Whole Child & Parent
            25 Main St.
            Julie B. Rosenshein

            PALMER

            2 Guys With Tools Handyman Service
            2114 Baptist Hill Road
            Robert Anthony Nenzel

            Three Rivers Tavern
            2052 Main St.
            Belchertown Pheasant Run Inc.

             

            Penny’s E. Picks
            51 Squier St.
            Jay W. Heinicke

            SOUTH HADLEY

            D&R Home Services
            5 Harlow Place
            Arthur R. Hogan Jr.

            Liberty Installations
            240 Brainard St.
            Richard Liberty

            SOUTHWICK

            Amici Salon
            515 College Hwy.
            Susan Shlosser

            Anson Flower Farm & Nursery
            591 College Highway
            Warren Baker

            Design Presentations
            1 Logie Lane
            Michael Pietruska

            Jimmy’s Landscaping
            98 Vining Hill Road
            James Stellato

            Oak N’ Keg
            1 Chapman St.
            Vimal Patel

            SPRINGFIELD

            Art in Action Fine Art
            229 Connecticut Ave.
            Toni Marie Stabilo

            Auric Services Inc.
            15 Dorset St.
            Lance D. LeTourneau

            Chili Dogs
            50 Sanderson St.
            Eugene Pretlow

            D & J Lock & Key
            244 St. James Blvd.
            James Michael Lage

            Daviau Business Services
            11 Dorset St.
            Christine Elaine Daviau

            Elegant Prints
            45 Valley Road
            Lakisha Marie

            Envy Nails
            1777 Boston Road
            Dien Nguyen

            Europa Cleaning Service
            1350 Main St.
            Luisa Cardaropoli

            First Fruit Online Marketing
            40 Sylvan St.
            Suzette

            Gee Barber Shop
            21 Rutland St.
            Johaim Santiago

            Golden Bar & Restaurant
            1127 Main St.
            Rudy Renoso

            Jenn Jemm Photography
            54 Vincent St.
            Rosa M. Torres

            Lee’s Sports
            47 Pearl St.
            Winston Lee

            Mi Isla Music
            35 Indian Leap St.
            Jose Antonio Amaro

            WESTFIELD

            Law Office of John F. Kavanagh, Jr. PC
            10 School St.
            John F. Kavanagh, Jr.

            PPM
            57 Pleasant St.
            Craig Purdy

            Pyramid Nutrition Service
            144 Elm St.
            Nicole K. Frank-Masler

            Tatro’s Mobile Mechanic Services Inc.
            16 George St.
            Gregg Tatro

            Y&G Handyman Services
            216 Sackett Road
            Yuriy Rudenko

            WEST SPRINGFIELD

            All Trash Connection
            389 Park St.
            Ty Geas

            Cori’s K9 Clip
            242 Elm St.
            Cori Napolitan

            Healthy America Marketing Solution
            49 Fairview Ave.
            Joel Gauthier

            JF Investigative Service
            48 George St.
            Juan Fernandez

            Lattitude
            1338 Memorial Ave.
            Jeffrey Daignzau

            Mayers Home Repair
            42 Baldwin St.
            Simeon Mayers

            Nescor
            148 Doty Circle
            Sharon Tariff

            New Season
            1098 Memorial Ave.
            Orsana Mozolevskaya

            North Garden Chinese Restaurant
            42 Myron St.
            Raymond Kan

            Ron’s Income Tax Service
            454 Main St.
            Roland M. Navone

            Departments

            Pamela Monaco has been named Director of the University Without Walls program at the University of Massachusetts Amherst.

            •••••

            Berkshire Hills Bancorp Inc., the holding company for Berkshire Bank, has named Gary M. LeBlanc as its Branch Manager for the Ludlow location at 431 Center St.

            •••••

            Brenda Cuoco of Wilbraham Coldwell Banker Residential Brokerage has achieved the International Diamond Society award for 2007. Cuoco is ranked the No. 1 agent in Coldwell Banker Residential Brokerage throughout Hampden, Hampshire, and Franklin counties, according to the Greater Springfield Board of Realtors.

            •••••

            Robert S. Wheten has been elected to Assistant Vice President, Commercial Credit, at Easthampton Savings Bank. He was hired by the bank in 2001 as a credit analyst. He was promoted to senior credit analyst in 2005 and to commercial credit officer in 2007. Wheten manages credit quality issues and supervises the underwriting of the bank’s larger commercial loans.

            •••••

            The Greater Springfield Convention and Visitors Bureau announced the following:
            • Erin Tierney has been named a Convention Center Sales Manager, and
            • Caitlin Casali has been named a Convention Center Sales Manager.
            Both women will work with Todd Greenwood, Vice President of Convention Center Sales and Marketing, in selling and marketing the MassMutual Center for citywide convention groups.

            •••••

            Stephen L. Kuhn, Senior Vice President, Secretary, and Deputy General Counsel at Massachusetts Mutual Life Insurance Company in Springfield, has been named to the 2008 In-House Leaders in the Law list published by Massachusetts Lawyers Weekly. This is the second consecutive year that Massachusetts Lawyers Weekly has published the list, which recognizes corporate attorneys throughout New England who serve as either general counsel or staff attorney. Kuhn was one of 15 attorneys throughout New England chosen by five panelists.

            •••••

            Elizabeth Solomon’s wallpaper titled “Lily with Buds” is featured in the April 2008 edition of Real Simple magazine. The article, “Wallpaper Made Easy,” appears in the “Home” section of the magazine. Solomon recently created Elizabeth Solomon Designs, a new and whimsical line of work which celebrates her love of color, pattern, and design. Given Campbell, owner and designer of Given Campbell Design Studio, has licensed many of Solomon’s designs, and is manufacturing and retailing her wallpapers. Samples of Solomon’s wallpaper will be on display in her studio at the spring Cottage Street Open Studios event on June 7-8 in Easthampton.

            •••••

            Lia Sophia recently announced top honors for its Excellent Beginnings Program Achievers for outstanding sales accomplishments and professionalism. Eileen Maunsell was honored for attaining certain sales levels in her first 15 weeks and by sharing Lia Sophia with other new advisors.

            •••••

            Health New England has announced the following:
            • Patricia Scheer has been promoted to Director of Quality Operations;
            • Michelle Sears has been promoted to Accounting Manager;
            • Susan Keser has been promoted to Director of Provider Contracting;
            • Renee Wroth has been promoted to Director of Service Operations, and
            • Barbara Berthiaume has joined the firm as a Director of Health Services.

            •••••

            Ronald X. Johnson recently joined the staff of Springfield School Volunteers as the Program Manager for Employer Outreach.

            •••••

            Patrick J. Willcutts, Vice President-Investments CFP for UBS Financial Services Inc., has earned the Certified Investment Management Analyst license through the Investment Management Consultants Association. Willcutts, who works in the firm’s Springfield office, attained the license following coursework and an examination at the Wharton School at the University of Pennsylvania.

            •••••

            PeoplesBank has announced that Paul E. Hillsburg will serve as Assistant Vice President for PeoplesFinancial and Insurance Services at the Bank’s South Hadley office located at 494 Newton St. As a representative of Infinex Investments Inc., Hillsburg will provide customers with financial planning and investment guidance, including retirement, estate, and college education planning. Hillsburg has served as a Financial Consultant for Infinex Financial Group and as a Financial Advisor for Merrill Lynch. He holds Series 7 and 66 registrations and holds an insurance license with life, health, and variable products.

            •••••

            The Howdy Awards Committee of the Greater Springfield Convention and Visitors Bureau (GSCVB) has selected Bruce Landon, President of the Springfield Falcons Hockey Club, as the recipient of the 2008 Spotlight Award. The Spotlight Award is bestowed at the GSCVB’s annual Howdy Awards for Hospitality Excellence. Unlike the winners in eight Howdy Award categories who are selected by hospitality judges from outside the Pioneer Valley, the recipient of the Spotlight Award is chosen by the committee based on his or her dedication and outstanding contribution to the region’s hospitality industry and the long-term impact their efforts have had on tourism in the Pioneer Valley. Landon has served as general manager for 24 campaigns and as president for 14 seasons with the Springfield Falcons Hockey Club. Originally a player with the Peterborough Petes of the Ontario Hockey League, he was selected in the 1969 amateur draft, then relocated to Springfield in October of that year. After eight seasons of playing professional hockey in Springfield, Hartford, and Providence, he suffered a knee injury that ended his playing days, but not his involvement with the sport. He was soon appointed director of Marketing and Sales for the Springfield Indians and was the color commentator on the team’s radio broadcasts. In 1979, Landon received the Ken McKenzie Award, the American Hockey League’s (AHL) award honoring the individual that best promotes his or her team during the season.  Three years later, he was promoted to general manager, a title he holds to this day. He has overseen two consecutive Calder Cup-winning teams, and was the recipient of the James E. Hendy Award, which honors the league’s top executive, in 1981. In 1994, he made the firm commitment to keep hockey in Springfield. After the city lost its professional hockey team, Landon joined forces with Wayne LaChance to spearhead Pro Friends Inc., an investment group that was awarded an AHL expansion franchise: the Springfield Falcons. Prior to the 2002-03 season, Landon was involved in the creation of a new ownership group, Springfield Pro Hockey, LLC, which purchased the Falcons from Pro Friends Inc. Through the years, Landon has served as a key member of the AHL’s Board of Governors as well as several of its committees. Landon will receive his award on May 20 during the 13th annual Howdy Awards for Hospitality Excellence at the Log Cabin Banquet & Meeting House in Holyoke.

            40 Under 40 Class of 2008
            Age 34: General Counsel/Chief Legal Officer, Hampden Bank and Hampden Bancorp Inc.

            Ask Craig Kaylor what teaching and being a lawyer have in common, and he’ll probably tell you, “a lot.” In fact, he might even say that he was destined to find ways to marry the two.

            Since the age of 10, Kaylor has dreamed of becoming a lawyer, but knew that he could be just as successful as a teacher since both of his parents were educators. “I always knew it was the law or teaching,” he told BusinessWest. In the end, the law won. “You can teach when you’re a lawyer, but it’s tough to practice law while you’re a teacher.”

            Kaylor has made a name for himself in the legal profession. At 32 he was named general counsel of Hampden Bank and parent company Hampden Bancorp. He helped take Hampden Bancorp public last year, and was instrumental in helping the company achieve an ‘outstanding’ rating for its Community Reinvestment Act Committee. As a member of the CRA, Kaylor helps determine which community loans, service, and volunteering efforts will take place. It’s a huge effort, he said, since the committee logs about 6,000 service hours among just 100 employees.

            But despite his success in the legal sector, Kaylor has never forgotten his second love, teaching. Not only does he spend a good amount of time educating his peers at Hampden Bank about the many aspects of legality, compliance, security, and risk management, he also teaches a payment systems class at Western New England College.

            With 10 students in his class, Kaylor says his first year in a true teaching gig is going very well. He said it feels good to be sharing his knowledge with the up-and-coming generations. “I’ve had great role models in my life who have gone out of their way to help me, so it’s important for me to give back,” he said.

            Giving back also includes coaching youth sports leagues in Longmeadow and Springfield for the past 17 years. In fact, this is the first year since 1990 that Kaylor is not coaching a team, but he has a good reason — becoming a father. His wife, Debra, recently delivered a son, James William.

            Could this be another lawyer/teacher to grace the world? We’ll have to wait and see.

            Laura DeMars

            40 Under 40 Class of 2008
            Age 37: Communications Director, City of Springfield

            Azell Murphy Cavaan has been around the block a few times, not to mention the world.

            With plenty of journalism and public-relations experience spanning Europe, Chicago, Washington, D.C., and Boston, Springfield couldn’t have called on a better person to help get it back on the map.

            Cavaan spent more than 14 years honing her skills in some of the biggest media markets in the world, including London as a trade journalist, Chicago as a reporter for the Daily Law Bulletin, Washington D.C. for the Medill News Service, and as a reporter for the Boston Herald. She’s interviewed some big names, including former President Bill Clinton and former First Lady Hillary Clinton. But even with all of the excitement of big cities and big names, Cavaan always held a special admiration for her home.

            Thus, in 2002 Cavaan returned with her husband to Springfield. They were expecting their first child, and Cavaan hoped the city would provide her child with the same nurturing and quality of life that she experienced here. “My family was here, so I wanted to make sure that my son would be close to them,” she said.

            After the move, Cavaan worked for the Republican, covering Springfield City Hall as officials tried to get the city back on its feet. In 2007, former Mayor Charles Ryan beckoned Cavaan to join his team as a herald to get the word out about the positive things happening in Springfield. “When your city needs or asks you to help, you do it,” said Cavaan.

            That’s a philosophy she came to wholeheartedly believe in after all of her traveling. “When I was working in these big cities, I got the professional development and personal growth that I am able to apply to Springfield,” she notes. “I’m glad to have gone and then come back.”

            Cavaan also enjoys lending her time to various organizations, including the Mass. Commission on the Status of Women.

            She is also a member of the Springfield School Volunteers and has become a mentor to students. “I’ve developed a real energy with them,” she noted.

            All in, Cavaan said she always thought that she would end up staying in a big city, but has realized that Springfield is the best community on the map for her. Simply put, she said, “I love this city.”

            Laura DeMars

            40 Under 40 Class of 2008
            Age 39: Attorney, Sullivan, Hayes & Quinn

            Melissa Shea was always fascinated by the law. But like many who eventually join the legal profession, she needed some inspiration to convert an interest into a career.

            She found hers in 1981, when Sandra Day O’Connor became the first woman appointed to the U.S. Supreme Court. That moment in history provided a spark for the Shea, now an employment-law specialist at Springfield-based Sullivan Hayes & Quinn, who is inspiring younger generations through her work inside the courtroom — and the community.

            As a labor, employment, and school-law attorney, Shea keeps busy representing many nonprofit organizations, as well as the Springfield, Holyoke, and Chicopee school systems. She has been recognized as a rising star among lawyers in Massachusetts by Boston magazine, and speaks before various organizations in the region, including the National Assoc. of Housing and Redevelopment Officials.

            She also lends her expertise to the Early Childhood Centers of Greater Springfield, the Holyoke Chamber of Commerce, and the Springfield Women’s Committee, an organization dedicated to honoring outstanding women in the community and bringing awareness to issues such as domestic violence.

            Shea has been involved with the Women’s Committee for the past 10 years, and has been devoted to the committee’s annual International Women’s Day celebration, as well as fundraising and holding food drives for area shelters. She says her involvement in the committee is rewarding because she is helping raise awareness of key issues that are important to continuing the success of local women.

            However, just as much as Shea feels at home in the courtroom, working in the legal system, and volunteering, she also feels quite comfortable in the kitchen.

            Fluent in Italian, Shea spent many of her summers growing up in Italy, and her first year of college was in Rome, where she perfected her cooking and gained a fondness for Italian culture and cuisine.

            “I spent a lot of time with my family there, and my aunt passed on her Italian recipes,” she told BusinessWest.

            “Cooking is rewarding, relaxing, and enjoyable, and I often cook with my children, so it provides an opportunity to spend some quality time with them while passing on traditions.”

            Shea hopes to take her husband and two children to Italy in the near future — once again, drawing on her experiences to inspire others.

            Laura DeMars

            Features
            Comcast Brings a New Bundle to the Small-business Marketplace

            Doug Guthrie

            Doug Guthrie says Comcast Small Business Voice addresses the direct needs of what has been an underserved constituency.

            Doug Guthrie says small businesses have traditionally been overlooked, or “underserved,” as he put it, when it comes to voice services, which is ironic, because they dominate the economic scene in most regions, including the Pioneer Valley.

            “Small businesses have pretty much had to take a back seat to bigger companies when it comes to phone service,” said Guthrie, vice president of Comcast’s so-called Connecticut-West Region, which encompasses the Valley. He told BusinessWest that his company is hard at work on remedying that situation with a new product rolled out earlier this year. It’s called Comcast Business Class Voice, part of a ‘Business Class’ bundle of voice, data, and television services that is similar in many ways to the company’s Triple Play package of those three services for residential customers. The new offering should help businesses operate more effectively, said Guthrie, while also saving money in the process through monthly charges as low as $99.

            Business Class Voice includes unlimited local and long-distance calling for one price, as well as features ranging from auto attendant to a host of caller ID services to three-way calling. The new product brings a number of benefits to small businesses, said Guthrie, starting with choice, meaning a viable option to the phone company. But it also offers an effective bundle, those aforementioned cost savings, and the ability for smaller companies (those with under 20 employees) to operate as much larger entities.

            “The idea behind this product is to make the small-business guy feel like the big-business guy,” he explained, adding that this concept is captured in Comcast’s materials to market the new product, which feature the tag line, ‘turn your office on.’ “We’re providing power to the business people.”

            Meanwhile, for Comcast, which does business in 39 states, Business Class Voice and the new bundle provide what Guthrie and others expect will be an effective vehicle for capturing a larger share of the small business market within its substantial footprint, which is pegged at $12 billion to $15 billion nationally, by most estimates.

            The immediate mission, or challenge, for the company, Guthrie acknowledged, is to convince would-be customers that a cable giant that has also gained a solid footing in the business of providing reliable, high-speed Internet service can also provide a quality voice service.

            He believes the product quality will speak for itself, literally and figuratively, and that Comcast can build on the track record it has compiled within the residential market.

            “We have a considerable amount of experience providing voice services to residential customers,” he explained. “We want to take that know-how to the small-business market, where there is enormous potential for growth.”

            Voice of Reason

            Anthony Facchini says his law firm was quick to be among the first to sign on for Business Class Voice and the Comcast business bundle.

            Springfield-based Facchini & Facchini has three lawyers (brothers Anthony, Richard, and Michael), 10 employees, and seven phone lines, said Fracchini, and saw in the Comcast package an opportunity to pay one bill instead of two or three, reduce some expanses, and gain better quality, reliability, and service response.

            Three months after signing on, he’s reporting all of the above.

            “Our bill used to be about $450 a month, and we’ve probably cut that in half,” he said. “Our Internet is much faster and more reliable, and the phone service is good; there have been just a few hiccups with it, but the service has been tremendous.”

            Facchini & Facchini represents the kind of customer, and the type of response, that Comcast had in mind when it spent the bulk of 2007 putting together its new product — one that would give it the opportunity to compete against AT&T’s package of phone and Internet service that runs for $90 per month, or closer to $130 when mobile phone service is added to the mix — while also building the sales and service team that would bring it to the market.

            Such small businesses have traditionally had few, if any, choices besides AT&T for land-line services, said Guthrie, adding that he believes Comcast’s business bundle will compete effectively, garner significant market share — perhaps 20% — and meet or exceed the company’s goal to create a $2.5 billion business by 2011.

            He bases that estimate on the quality of the package, the quantity of specific features and services, and, perhaps most importantly, the opportunity the Comcast bundle provides for businesses in terms of cost savings and greater efficiency.

            These are the selling points being stressed by a sales force amassed by Ed Gallagher, a 20-year veteran of the communications industry recruited by Comcast to become vice president and general manager of Buisness Services for Comcast’s NorthCentral Division, which encompasses all of New England. Gallagher was given the task of putting what Guthrie called the “building blocks” in place for the new business venture.

            Assignments included the hiring and training of a sales force for all regions, he said, adding that, by the end of 2007, Comcast had more than 2,000 employees across the country dedicated to the small- and medium-sized business efforts, including about 750 business salespeople and 1,400 technicians.

            They’ve been busy of late, said Guthrie, adding that early response to the bundle has been positive, and no doubt helped by a softened economy that has business owners thinking about costs and how to reduce them.

            “All companies are looking to trim their expenses and become more efficient,” he explained. “This is the right product at the right time.”

            And Western Mass. has the demographics to be the right place, he continued, adding that small businesses dominate the landscape in the 35 area communities to which the company provides service. These include Springfield, Holyoke, Westfield, Northampton, Greenfield, Longmeadow, and West Springfield.

            “We see Western Mass. as a strong growth area for us,” he explained, adding that many businesspeople in the area are familiar with Comcast through their residential cable, Internet service, or even cable advertising. Such relationships, coupled with the new voice product and the “business Triple Play,” as he called it, all add up to opportunities to take market share.

            Guthrie told BusinessWest that, while Business Class Voice is a new product, and it is part of a new small-business bundle, the company is bringing a significant amount of experience to this initiative that makes ‘new’ a bit of a misnomer.

            For starters, Comcast is the fourth-largest residential phone provider in the nation, so it brings voice experience to the table, he explained, and it has been offering its Triple Play — cable, Internet, and voice — to residential customers for years.

            “Comcast already delivers reliable voice service to thousands of business owners where they live,” said Gallagher. “These business owners now have the option of choosing Comcast for all their communications needs where they work.”

            Answering the Call

            “Comcast means business.”

            That’s another of the marketing slogans being used for the rollout of the new small-business bundle, and it has meaning on a number of levels, said Guthrie.

            First, it speaks to the company’s focus on bringing better services to small-business owners. But it also reflects the company’s aggressive plans to take market share in an increasingly popular small-business sector, which, as he said, offers vast potential.

            Whether Comcast will meet its ambitious goals remains to be seen, but the company’s intentions are as clear as a bell — or a strong dial tone.v

            George O’Brien can be reached at [email protected]

            40 Under 40 Class of 2008
            Age 38: Partner, Sullivan, Hayes & Quinn

            Imagine walking into a court case thinking you’ll be defending a company that’s having trouble with a so-called ‘alien’ (most often interpreted as a person residing and working illegally in the U.S.), only to find out that the plaintiff actually believes he’s an alien from outer space.

            This is just one of many interesting cases that Meghan Sullivan has encountered during her career. “Sometimes we come across people and cases that give us real pause,” she said, actually pausing for effect. And that partly explains why she loves her job as a labor and employment lawyer.

            “There’s always something,” she said. “You can never begin to anticipate how people’s personal lives influence their work lives.”

            While living and working in New York City in her early 20s, Sullivan ran into a variety of tough hiring and employment decisions, which would eventually lead her to pursue a law degree. “I was managing a retail store and kept running into situations where I’d need my dad’s advice,” she explained, referring to Frederick Sullivan of Sullivan, Hayes & Quinn. “I wanted to learn more about these employment and legal issues, and get my law degree.”

            But doing battle in the courtroom is just one way Sullivan likes to spend her time. She also enjoys taking a spin on the Holyoke Merry-Go-Round, which she has been riding since she was a child. “My grandfather used to take me to the carousel when it was at Mountain Park,” she said. “He stood for hours while I rode it.” After the park was closed in 1987, the ride was moved by a group of citizens to Heritage Park in Holyoke so that people could continue to enjoy it.

            Today, Sullivan serves on the board of the Holyoke Merry-Go-Round, something in which she takes great pride.

            “I often take my children to ride the carousel,” she noted. “It fascinates me that this same bit of amusement has spanned generations.”

            When she’s not visiting the carousel, Sullivan spends her free time with her family teaching her children how to ski, a hobby she recently took up again. She also isn’t afraid to get her hands dirty digging in her garden. “It’s a nice way to spend quality time with my children,” she says. “Their interests have become my hobbies.”

            Laura DeMars

            Sections Supplements
            A. Crane Construction Will Build Just About Anything
            Andrew (left) and A.J. Crane

            Andrew (left) and A.J. Crane say cultivating relationships, not aggressive bidding or advertising, has fueled the success of their family business.

            Andrew Crane says a “goofy motto” has long been at the heart of what A. Crane Construction is all about.

            “Picnic tables or bridges,” he said, “it doesn’t matter.”

            Not that he’d plaster the slogan on a sign or anything. The storefront in the Aldenville section of Chicopee that serves as headquarters of this 20-year-old construction business is modest, even unobtrusive, yet is still a step up in noticeability from the first 17-plus years when the company eschewed advertising and even a number in the phone book.

            Yet, Crane said, he has developed a loyal clientele based on the values of quality work, attentive service, and a willingness to do any type, and any size, of commercial or residential job.

            “I’ve always been in the construction business,” said Crane. “My grandfather was in it, and I liked it as a kid. My first real job was working for Daniel O’Connell for a couple of years, and from there I went on to homebuilding for a company that built post-and-beam homes.” After that, he spent eight years in the family business before striking out on his own in 1988.

            For the better part of two decades, A. Crane Construction conducted business out of a house in Chicopee, doing jobs only for people Crane knew personally. A couple of years ago, he moved to Grattan Street and published a phone number — but his philosophy of attracting work remains unchanged.

            “About 95% of our clients are people we know. It has always been that way,” he told BusinessWest. “We’ve built big stores, and we’ve hung mirrors. My first job was Chapdelaine’s Furniture in South Hadley, and then that summer I built a million-dollar house. But if someone calls me up for a storm door, I’ll do that, too.”

            At a time when larger builders are being hard-hit by dramatic economic shifts, it’s a philosophy that has kept his team working and profits coming in.

            Hammering Home a Point

            After starting out alone, Crane gradually hired a team; he employs 10 people today, and the same people-we-know philosophy has taken root there, as well. “The first guy I ever hired is still here,” he said. “The second guy, too.”

            Intentionally staying small, Crane has resisted the temptation to expand too quickly, which he claims would compromise quality. That has proven to be a solid business strategy at a time when increased competition in the building industry (see related story, page 29) has pushed bids downward and made it difficult for conventional firms to make a profit. Crane says he has avoided the low-bid trap by cultivating a reputation for personal service and quality control — and a stable of loyal clients — allowing him to earn more realistic profits without cutting corners.

            “People who go for the lowest price these days can’t be interested in doing it for a long time,” he said. “For one thing, they can’t do it for that price if they’re properly insured; that costs a certain amount of money.

            “I’d say the biggest single challenge in construction is to keep yourself legitimate,” he continued, arguing that the reputation of all builders is compromised by small, renegade contractors who act unscrupulously, whether by using shoddy materials or failing to have adequate insurance. “Anyone can put up a storm door, but I’ll bet you could go out and find six or seven out of 10 doing this business who are not properly insured. That hurts the general public, because if someone ever gets hurt or damage occurs, they won’t be able to recoup it. If everyone competing at some level works to get people a better product at less risk, they’ll be doing a good thing for the industry.”

            Crane is especially proud of his term as president of the Home Builders Assoc. of Mass. (HBAM), which ended last June. He had served the organization at the local and state levels before that time, all the while learning about issues that affect his industry. The role saw him warning lawmakers of the influence that homebuilding wields over the economy locally and nationally; “nobody believed it, but now the bubble has burst, and the economy is suffering as a result,” he said. And it also led him to push for a law requiring anyone with a construction supervisor’s license to complete continuing education courses on a regular basis; after stalling last year, that bill has made progress on Beacon Hill.

            “They need continuing education to learn safety rules, how to write contracts, all the things that protect the consumer. We almost got it done last year and had to wait for another session, but I’m glad it’s happening,” he said, noting that his time with the HBAM has given him an appreciation for aspects of the business that affect customers.

            “I encourage every business to belong to a trade association, whether it’s for teachers, doctors, dentists, whatever,” Crane told BusinessWest. “It kind of validates your existence in business, I think, and keeps you current on all the legislative issues. It really does set you apart from the average, everyday guy.”

            Steady On

            Among his customers over the years, Crane has built stores and revamped displays for Manny’s TV and Appliance, as well as building facilities for Jerry’s Music Shop in South Hadley, Ondrick Natural Earth in Chicopee, Class Grass Garden Center in Granby, a 60,000-square-foot commercial complex on Cape Cod, and the Home Builders Assoc. itself. Through the years, he has seen a roughly 50-50 split between homebuilding and commercial work.

            “Every year, there’s a decent-sized commercial job and a bunch of home remodeling. I have 10 remodeling jobs now, and another appliance store to build,” he said. “I like the challenge of doing both; it helps to manage the cash flow. And, again, it’s mainly people we know, not Joe Shmoe calling me to build a tire shop. And our customers keep coming back.”

            “We seldom competitively bid,” said Crane’s son, A.J., who joined the company four years ago. “Plans are sent to the office all the time, but we’re often too busy.”

            A.J. Crane was intrigued enough by his family’s business to earn a Civil Engineering degree to teach him everything from reading blueprints to managing large-scale construction projects. “I like working in an industry where there’s something to show at the end of the day. I’m lucky in that I have a lot of say in the day-to-day operations. My dad wishes he was in the field more,” he said, as his father nodded and smiled.

            “We’ve got the second generation coming in,” Andrew Crane said, “but I’ve always operated this place like a family business. The guys who work here have become close. They’re not just employees; we care about their welfare, and we want them to work safe and happy.”

            With that in mind, Crane likes the pace of growth so far, keeping the company small enough so that it doesn’t get stretched too thin. That reflects that oft-mentioned focus on individual attention, and the way it breeds loyalty. “We want to make decisions for customers like it’s our own stuff,” he said.

            Besides, Crane still wants enough time in the day to shepherd schoolchildren through a crosswalk outside his office. “The cars fly by here,” he said. “When the kids get out of school, if I see them, we run out and cross them. I don’t mind. It’s a good thing.”

            And just a few more people he’s getting to know.

            Joseph Bednar can be reached at[email protected]

            40 Under 40 Class of 2008
            Age 37: Attorney (Partner), Doherty Wallace Pillsbury & Murphy

            He was only getting started at Brown University, but Michael Sweet already had his career plans all figured out.

            “I knew what I wanted; I was going to be a business lawyer at Doherty Wallace Pillsbury and Murphy,” said Sweet, adding that this ambition was actually inspired long before he got to Brown — and, later, its law school — by the words and deeds of long-time lawyers at that Springfield-based institution, including his former lacrosse coach in Longmeadow and mentor, Craig Brown.

            Sweet fulfilled his stated career goal — his office is just down the hall from Brown’s — but not before taking a slight detour, specifically a two-year stint with the prestigious New York firm Winthrop, Stimson, Putnam & Roberts. How he went from Wall Street and representing Fortune 100 companies to Springfield’s Main Street is an intriguing story, one the Economic Development Council of Western Mass. might want to borrow as it goes about selling the Pioneer Valley.

            That’s because, while Sweet was once determined to make his career in the Valley, he thought he had to see the bright lights and the big city first — especially after hearing from other students at Brown about their plans. Only after doing so did he realize that he was right the first time.

            “I had to get it out of my system,” he said of his New York experience, adding that he came back home to realize his early career ambition — and to make a difference in the community. And he’s doing so at places like Gray House, a large, gray house in Springfield’s North End that has created a number of programs to help disadvantaged families.

            Sweet has been involved with Gray House for a decade now and currently serves as president of its board of directors.

            He’s been involved with many other groups, including the Springfield Enterprise Center at STCC.

            Giving back is part of the corporate philosophy at Doherty Wallace, he said, adding that this is one of many lessons that Brown and others have imparted to him — not through words, but with actions. And now, he’s providing inspiration to others.

            “You do things in the community because it’s the right thing to do,” explained. “But you also do it because you recognize that we are part of the community, so it’s something you’re doing for everyone, including yourself.”

            George O’Brien

            Departments

            The following is a compilation of recent lawsuits involving area businesses and organizations. These are strictly allegations that have yet to be proven in a court of law. Readers are advised to contact the parties listed, or the court, for more information concerning the individual claims.

            CHICOPEE DISTRICT COURT

            Gerald E. Guiel v. M.J. Nails
            Allegation: Pedicure performed negligently resulting in injury: $15,000
            Filed: 3/31/08

            FRANKLIN SUPERIOR COURT

            Homesavers Council of Greenfield Gardens Inc. v. Shaw Industries Inc. and Continental Flooring Co.
            Allegation: Breach of construction contract: $330,000
            Filed: 4/8/08

            GREENFIELD DISTRICT COURT

            Standard Funding Corp. v. Anthony’s Residential Contracting
            Allegation: Breach of finance agreement: $3,426.36
            Filed: 3/21/08

            HAMPDEN SUPERIOR COURT

            Dale Auto Body Inc. v. Western Mass. Electric Company
            Allegation: Breach of contract to provide services: $29,775
            Filed: 2/25/08

            Denise Melanson v. Video Communications Inc.
            Allegation: Employment discrimination: $25,000+
            Filed: 2/19/08

            Fred Quagliaroli v. The Mardi Gras
            Allegation: Negligence and personal injury suffered by plaintiff when pushed by Mardi Gras employee: $300,000
            Filed: 4/11/08

            Witalisz & Associates Inc. v. Whispering Pines at Root Road, LLC
            Allegation: Breach of contract: $777,979.62
            Filed: 1/30/08

            HAMPSHIRE SUPERIOR COURT

            John C. Urschel v. Bioshelters Inc.
            Allegation: Non-payment of promissory note and unfair and deceptive trade practices: $50,000
            Filed: 3/27/08

            NORTHAMPTON DISTRICT COURT

            Francis Baldwin III v. The Premier Insurance Company
            Allegation: Failure to pay personal injury protection benefit: $7,721.02
            Filed: 3/31/08

            Victory Steel Products v. Quabbin Well Drilling Inc.
            Allegation: Non-payment of goods sold and delivered: $13,640.14
            Filed: 4/2/08

            SPRINGFIELD DISTRICT COURT

            City Line Distributors Inc. v. Robe Inc. and Mark E. Robitaille
            Allegation: Non-payment of produce delivered: $6,671.62
            Filed: 1/29/08

            Roy’s General Contracting Inc. v. MLS and IZS Enterprises
            Allegation: Non-payment of general-contracting services: $2,697.00
            Filed: 3/13/08

            Tri-County Contractors Supply Inc. v. Total Renovations & Construction, LLC
            Allegation: Non-payment of goods sold and delivered: $8,489.29
            Filed: 1/22/08

            WESTFIELD DISTRICT COURT

            International Bar-Tech Solutions Inc. v. Southwick Electric Company Inc.
            Allegation: Breach of contract for goods and services: $11,288.19
            Filed: 3/12/08

            40 Under 40 Class of 2008
            Age 38: Attorney (Associate), Bacon Wilson, P.C.

            Jeff Fialky had several options when he was job-hunting a few years ago, near the end of his stint with Adelphia Communications in Andover.

            A few of them were with Boston-based law firms, and they were certainly attractive, he told BusinessWest. But another was with Springfield-based Bacon Wilson, where his father happened to be a partner. He eventually chose the latter, in part because it meant returning to an area he grew up in and loved. But there was more; he really wanted to get involved in the community and “make a difference,” and knew that the opportunities to do so — and the need to do so — were here in the Pioneer Valley.

            “In Boston, they don’t really need people to raise their hand and volunteer,” he explained. “Here, they do; here, you can make an impact.”

            And since joining Bacon Wilson nearly two years ago, Fialky has committed himself to “walking the walk.” Indeed, while building a law practice focused on business and commercial real estate, he has been active in the community on several levels.

            He’s a board member with a number of organizations, including the Springfield Chamber of Commerce, the American Red Cross of the Pioneer Valley, and the Young Professional Society of Greater Springfield, or YPS. He’s also on the Advisory Committee at the Springfield Enterprise Center at STCC.

            Fialky said his involvement with the Chamber, YPS, and enterprise center helps satisfy his desire to foster economic development in the region. He told BusinessWest that the Valley provides an attractive quality of life, but to attract and keep more young people it must also offer career opportunities.

            Fialky is devoting considerable energy to YPS, a group formed in 2007. He is one of many shaping a mission for the growing fellowship of young leaders, and helping it make a significant impact — there’s that word again — in the Pioneer Valley.

            Perhaps his biggest challenge at the moment is finding time to grow his practice and serve those nonprofit groups, and that test will become even sterner this summer, when Fialky and his wife, Emily, are expecting their first child, a boy.

            “This is something I’ve looked forward to for a long time,” he said of fatherhood, adding that it will soon be the most important line on his resume — and still another opportunity to make a difference.

            George O’Brien

            40 Under 40 Class of 2008
            Age 32: Director of Public Relations, Winstanley Associates

            For Jennifer Glockner, it’s all about getting the word out.

            The director of public relations for Lenox-based Winstanley Associates handles not only the regular PR work for her firm, but also similar duties for some big-name clients such as Spalding. Recently, she helped coordinate community events surrounding the visit of Prince Saud bin Thunayan Al-Saud of Saudi Arabia, chairman of SABIC, the new owner of GE Plastics (now SABIC Innovative Plastics).

            But it wasn’t always PR and the Berkshires for Glockner. Starting out in Kalamazoo, Mich. at a television station, she relocated to Denver, Colo. to become producer of a top morning show. The show even ended up with the highest ratings in the country for its market. Then, after meeting her future husband, who is originally from Pittsfield, she took another leap and moved to Massachusetts to become an advertising salesperson for the Berkshire Eagle.

            “This is actually my third career,” she said. “Sometimes I wonder what I was thinking when I risked moving without a job or knowing anyone, but it was also nice to go off on my own.”

            Despite her taste for new frontiers, Glockner thinks she’ll be staying put for a while. Since moving to Massachusetts in 2003, she has become involved with a variety of community organizations, including the Berkshire Leadership Program Committee, the Mass. Audubon Berkshire Wildlife Sanctuaries, and the Pediatric Development Center.

            Most dear to Glockner, however, is the Junior League of Berkshire County. Initially coaxed by her mother-in-law to join so she could meet people and become familiar with the area, Glockner ended up falling in love with the organization. In fact, Glockner is slated to become the next president of the group.

            “I am excited to take over as president. This is an organization with a great group of women in it,” she noted. “I know that we’ll get a lot done in the community over the next several months and have fun doing it.”

            In her spare time, Glockner loves to ski, something she picked up in Colorado. But now that the snow is almost gone, you can find her and her husband, Theodore, trekking across the Berkshires with their loveable dog, Pudding, a 10-year-old chocolate lab, who can’t get enough of the outdoors — or carrots.

            Laura DeMars

            40 Under 40 Class of 2008
            Age 36: City Councilor at Large, Holyoke

            A lifelong Holyoke resident, Kevin Jourdain has made a career out of giving back to the community.

            Fifteen years ago, he secured a piece of Holyoke history when, at age 22, he became the youngest person ever elected to the City Council. Now 36, he’s an at-large councilor, a seasoned veteran of Western Mass. politics, and an individual with a strong commitment to this industrial city and its future.

            “My whole adult life has been in public service,” he said. “This is a great outlet to make a difference and an impact, as well as meet hundreds of people you never would have met before.”

            Jourdain met some of those people through his extensive community service, entered into both as part of his duties on the City Council and on his own, to pursue personal passions. He’s a former board member of the T.J. O’Connor Animal Shelter in Springfield and the Valley Opportunity Council, and a current member of the Board of Trustees at Holyoke Community College.

            “This position has been a pleasure because I feel strongly that HCC can become a real incubator of business and commerce for Holyoke,” he said. “It already has a great foundation and a strong sense of community, and I think it’s showing.”

            That sentiment extends to other parts of Holyoke, too. Jourdain speaks enthusiastically about several projects in the city, including many with an educational component. He’s particularly excited about work beginning on a new intermodal transportation center, which, through a collaboration with Peter Pan Bus Lines, will create a bus depot in a former fire station, as well as an adult basic education center.

            “This will be one more way to link Holyoke’s community,” he said, “especially its young people, to education in any way we can.”

            Jourdain holds a bachelor’s degree in Political Science and Economics from UMass Amherst and an MBA from Anna Maria College, and is currently pursuing a Juris Doctor from the Massachusetts School of Law in Andover. That’s in addition to raising three children under the age of 6 (Kevin Jr., Jacqueline, and Allison) in Holyoke along with his wife, Shari.

            “I think no matter how busy we are, there’s always time to give something back,” said Jourdain. “I like this community. I like living here, and I made a commitment early on to get involved.”

            Jaclyn Stevenson

            Features

            It’s Not Exactly Business as Usual in the Valley, but There’s No Panic, Either

            ‘Survival mode.’
            That’s a term being seen and heard with increasing frequency these days as the media covers the ongoing economic downturn and how individuals, families, businesses, and municipalities are responding to life within it.

            This phrase and others like it may accurately depict the current picture within some areas of the country, and even some parts of the Bay State, said Ken Albano — putting the accent on ‘may’ — but they’re a bit overblown for the Pioneer Valley, where, it seems, most companies seem intent on doing more than merely surviving.

            “A lot of people are saying, ‘knock on wood, I’m doing OK,’” said Albano, a business law specialist with the Springfield-based firm Bacon and Wilson, who spoke about life for his clients, as well as for his law firm. “They’re just not saying it very loud because they’d prefer to fly under the radar screen and not say they’re doing OK, in case something happens.”

            Others used different words and phrases to convey essentially the same thing — that the economic downturn (there still appears to be some debate over whether this is officially a recession) has business owners cautious and wary about what might happen. But no one is yet drawing up comparisons to 1991, the height of the last deep recession, when the phones simply stopped ringing at many companies.

            It’s not exactly business as usual in this region, by most accounts, and there are some definite signs that times are tough. Indeed, the demise of low-cost carrier Skybus earlier this month brought the downturn home to the Valley and, specifically, to Westover Metropolitan Airport in Chicopee, with an exclamation point. Meanwhile, there are real concerns about the residential real-estate market and its fate. There is talk of large-scale cutbacks across the Commonwealth as state and municipal officials grapple with budget deficits and declining tax revenues, and most all businesses have been touched in some way by high gas prices and sky-high diesel fuel prices.

            But many of those asked to give a quarter-pole analysis of 2008 and the state of the local economy were sounding mostly optimistic tones. Here are some observations:

            • Laura Stevens, president of the regional offices of Keller Williams Realty, said that, contrary to popular opinion, houses are moving — if they’re priced right, that is. “The problem we have is that a lot of people simply don’t want to believe that their house has lost 10% of its value since last year, and they’re stubborn,” she said, referring to the average drop in the Valley, by most estimates, that she believes represents a market correction that was overdue. Stevens remains optimistic that sellers will come to grips with reality and that, likewise, buyers will realize that there is no real advantage to waiting, two prerequisites for reducing a bloated inventory that is keeping prices lower. The question is, when?

            • Arlene Putnam, general manager of the Eastfield Mall in Springfield, said most retailers there enjoyed a fairly strong February — “why, no one is really sure.” Despite mostly gloom-and-doom headlines and sound bites locally and nationally, she expects this sector to hold its own amid a general decline in consumer confidence and capitalize on those economic-stimulus checks that people will be getting later this year.

            • Kenneth Boutin, senior vice president and senior credit officer at Holyoke-based PeoplesBank, wasn’t projecting a strong first quarter for commercial lending activity last fall, but to his surprise the numbers are solid, with business owners in many sectors making investments in new equipment and facilities. Some industry groups are doing better than others, he acknowledged — hospitality is struggling somewhat, for example — but most are exercising caution, not hunkering down.

            • Joe Ascioti, president of Reliable Temps in Agawam, said that, thus far, he’s seeing little evidence of companies cutting back or delaying planned hiring. He admits, though, that the picture is seriously clouded by the much-bigger story — ongoing struggles in many sectors to find enough good help. This is evidence, he said, that shortages in labor that many have projected for years down the road — when smaller generations are going to be asked, unrealistically, to fill the huge void left by retiring Baby Boomers — are already here.

            In this issue, BusinessWest takes an in-depth look at the economy as the second quarter of ’08 begins, and the issues that will determine what happens short- and long-term.

            House Money

            Stevens told BusinessWest that, in response to one reporter’s question a few months ago, she said that “if there was a recession, her company was choosing not to participate in it.”

            That was her way of saying that Keller Williams is having a solid start to ’08 and that, overall, the local housing market is not as depressed as many other areas of the country, nor is the picture as bad as most would believe.

            She used the word “stable,” and went so far as to say that a long, bleak winter may have as much to do with the current conditions as any downturn in the economy, and that the picture will improve when the weather does.

            “We’ve been ignoring the headlines and advising our clients to essentially do the same,” she said. “We tell them that if they put a reasonable price on their house, someone will buy it. I can sell anyone’s house in a day — you just have to price it right.”

            It appears that not enough people in the Valley are heeding such advice, because the local housing market has declined to the point where firms such as Bacon Wilson, which handle large volumes of real estate closings, are certainly feeling an impact on the bottom line.

            Albano said this is part of a broad trickle-down effect from a slow housing market that he and most others believe is perhaps the most important factor impacting the fate of the local economy short- and long-term. That’s because this trickle-down impacts businesses ranging from law firms to homebuilders to retailers, and it’s real, based on what he’s seen and heard anecdotally.

            “It all starts with the real estate market, and right now, it’s slow,” he said, adding that he can qualify matters more easily than he can quantify them. “There were times during the boom three or four years ago when a deal would come in the door and you’d have to order a title exam from the local title examiner. The feedback you’d get was, ‘maybe next week at the earliest.’ That’s not happening now; people are sitting around waiting for the phone to ring because people aren’t buying and selling homes.

            “I represent a few local developers who opted to get into the over-55-development concept,” he continued. “It still is a great concept … but for people to move into one of these complexes, they need to sell their house; there’s a big backlog of inventory at these over-55 developments because people have signed up to move in but they can’t until they close on their existing home.”

            While he insists he’s a “glass-half-full person,” and sees plenty of positive signs regarding the economy, Albano says the residential market is the key, and there are real questions about when it will rebound. “I’m glad I’m not a mortgage broker right now, and I’m glad I’m not a Realtor.”

            Stevens is a Realtor, and she expressed some cautious optimism that the market will improve, but included a number of caveats. Specifically, she said some attitudes will have to change if the big picture is to brighten considerably.

            Elaborating, she said that both buyers and sellers should think through their strategic outlook and not respond to headlines, perceptions, or their what neighbor might be thinking or doing. For sellers, she said, most expectations on price are not realistic, and this is contributing to high inventory: “if a house is priced right, it will sell; if it’s not, it won’t.” As for buyers, if they wait to pull the trigger due to reasonable expectations that prices will go still lower, they will only see any benefit offset by rising interest rates.

            When or how much they’ll rise is anyone’s guess, she continued, but logic dictates that they can’t go much, if any, lower. “Once the economy stabilizes, rates will rise, and buyers will be sorry.”

            Overall, Stevens said sellers are only hurting matters by rushing to sell now, amid fears that conditions will only worsen. Such actions will simply turn those fears into reality, she explained, because a glut of homes with ‘for sale’ signs keeps prices down, while giving buyers more reason to hesitate, which just deepens the cycle.

            “More people are trying to sell because they fear what’s coming — sellers are the ones panicking the market,” she said, noting that her firm currently has about 130 listings, when it normally would have roughly 90. “If they would just stay put, the inventory would go down, buyers wouldn’t have so much to choose from, and they’d bid against each other on houses.”

            Banking on It

            While the residential housing market bears watching, so too does the commercial-lending realm; when conditions worsen, some business owners will put off expansion plans or investments in new equipment and facilities until they feel more confident about the future.

            But thus far in ’08, there has been little such hesitancy, said Boutin, who admits to being more than little surprised by the numbers recorded by the PeoplesBank commercial-lending department thus far this year.

            “We’re ahead of the pace for the past few years,” he said, attributing this to, among other things, several strong sectors, including health care and education, as well as a manufacturing base that is considerably smaller than it was years ago, but still has many strong players that have flourished in niche markets.

            “This market doesn’t see as the highs or the lows that other areas, like Boston, do,” he said, referring to the Valley’s traditional performance during economic declines and upswings. “We’re ‘steady Eddie.’”

            Donna Bliznak, vice president of Commercial Loans at PeoplesBank, told BusinessWest that there isn’t much, if any, speculative borrowing at present, but companies are responding to what they need in terms of growth strategies. She cited one manufacturer that secured $1 million for new equipment and another that borrowed $2 million to invest in new technology. “There’s been a steady stream of business coming in the door.”

            Mary Meehan, another vice president of commercial loans at PeoplesBank, said the commercial real-estate market remains fairly steady, with many clients and potential clients looking for investment opportunities.

            Still, all three bankers noted that it’s early in ’08, and many business owners are still analyzing year-end accounting statements. The next few months will provide a good barometer of overall business confidence, said Bliznak, adding that some sectors are more vulnerable to worsening conditions than others.

            One sector that would certainly appear to be in harm’s way is retail, and some components of this industry, especially restaurants, hotels, and other hospitality-related businesses, are being impacted as consumers tighten their belts.

            Putnam acknowledged that seemingly non-stop gloom-and-doom coverage of the scene nationally tends to wear down consumers — “those headlines scare people” — but she is optimistic that the worse may be over, and some first-quarter numbers support her positive feelings.

            Indeed, while most retailers did not enjoy a good holiday season and that trend continued into ’08, there was, at least at Eastfield Mall, a noticeable bounce in February.

            “Many of our stores reported increases over last year’s numbers,” said Putnam, adding that some imaginative steps, such as a ‘summer in February’ program staged during school vacation week, succeeded in bringing people to the mall.

            “And if you can get them to the mall, they will spend money in the stores and eat lunch here,” she said, adding that confidence among consumers remains generally high locally, and it should remain that way unless the situation changes for the worse in dramatic fashion.

            And she doesn’t believe it will. A veteran of several economic cycles, Putnam said that, generally, when people start talking about definitely being in a recession (as many economists are with regard to the current conditions), the nation is already on its way out of recession.

            “I think we’ve hit that magic point, and there’s no place to go but up,” she said, expressing confidence that a presidential election, which generally helps boost an economy, coupled with those economic-stimulus checks, should brighten the picture for retailers within a few months, and certainly by back-to-school sales time.

            What the jobs picture will look like by then is anyone’s guess, said Ascioti, who admitted that he is having a hard time making complete sense of what’s going on now. In general, he said, businesses are not showing signs of cutting back or putting off hiring, and are proceeding as they would during better times.

            But there is a problem, he continued, noting that businesses in many sectors continue to struggle in their search for qualified help. Many are turning to companies like Reliable Temps for help, he continued, which helps explain a strong Q4 in ’07 and a good start to ’08 for the firm.

            “Companies are wanting us to find them good, quality people they can hire, and to me, that’s not indicative of a recession,” he said. “All of our seasonal people are starting to pick up, and our phones are ringing; we’re seeing a lot of people looking for work.”

            But it leads to questions for the long term. “People were projecting that, down the road, there would be real shortages of people for many different jobs because the Boomers would be retiring and there wouldn’t be enough members of the younger generations willing to go into those fields,” he said. “Well, it’s starting to happen now.”

            Summing things up, Albano said Bacon Wilson is responding to the current downtown as most responsible businesses would — with caution and what he called “smart spending.”

            This strategic approach applies to everything from additional hiring to marketing to charitable giving, such as sponsorship of benefit golf tournaments. “We’re going to be prudent and spend when and how it makes sense to do so.”

            That’s all most companies are doing for now, he said, displaying that ‘glass-half-full’ mentality. “I talk to a lot of people in business, and, for the most part, they are doing OK.”

            Knock on wood.

            Sections Supplements
            Auto Insurance Gets Competitive in Massachusetts

            The last time Massachusetts introduced market competition to auto insurance, the experiment lasted only 12 months. Now, 30 years later, the state has once again shifted away from its fully regulated system into something called ‘managed competition.’ The state insurance commissioner vows to steer clear of past mistakes and promises rate reductions for many drivers. But motorists with not-so-clean records may be surprised to see their costs going up — while insurance agencies help consumers navigate an often-confusing maze of new options.

            Is the Bay State’s switch to competitive auto insurance rates cause for celebration or concern? The answer might just depend on your driving record.
            “The new, managed-competition system penalizes people with bad driving records, and rates are going to be higher for operators who are considered higher-risk, which includes youthful drivers,” said Diana Paris, personal lines manager for the Insurance Center of New England in West Springfield. “At the same time, good drivers are seeing big savings, and that’s a good thing.”
            “Based on what we’re seeing, a lot of people are going to save money — primarily the best drivers,” meaning those with the fewest accidents and citations on their record, noted James Phaneuf, owner of Bell and Hudson Insurance Agency in Belchertown. “Early indications seem to be that less-experienced drivers may pay slightly more for their insurance, so not everyone will save money under this system.”

            For much of the past century, all rates for automobile insurance in Massachusetts have been set by the state Division of Insurance — until this month, the only such regulated system among the 50 states. Anyone who requested a premium quote for a certain level of coverage would receive the same price from any number of companies, unless they were eligible for a group discount.

            Managed competition, which began on April 1, allows insurance companies to offer their own rates. Although these rates may vary, they must still be approved by the Division of Insurance — hence the term ‘managed.’ For the first time since a disastrous attempt at changing the system 30 years ago, Massachusetts drivers may now compare the different rates, benefits, and services offered by the 19 insurance companies competing for their business in the Commonwealth.

            Many are busy doing just that, and — if the agencies interviewed by BusinessWest are any indication — actively seeking professional help to navigate the sudden plethora of options.

            “There are some fairly subtle pricing differences between companies — and some significant ones,” said William Grinnell, president of Webber and Grinnell Insurance in Northampton. “The good thing about being an independent agent is that we represent several different insurance companies and are able to shop them to consumers. So we’re getting a lot of calls asking, ‘what’s my premium going to do?’ ‘Can I do better with another company?’”

            The verdict is still out on how many motorists will actually wind up paying less, but consumers and agents alike have been generally receptive to the change, which is also bringing new business into the Bay State; Progressive Insurance will begin selling insurance to drivers here in May, bringing the total number of competitors to 20.

            In this issue, BusinessWest examines the benefits of managed competition, as well as some the possible pitfalls, as insurance options open up like a six-lane highway.

            Engine Stall

            Under the prior, regulated system, insurance providers were required to apply specific surcharges for certain accidents and traffic violations, a program known as the Safe Driver Insurance Plan (SDIP). Now, insurance companies will be permitted to develop their own rules, subject to state approval, for imposing surcharges for at-fault accidents and traffic violations. They may also use the state-established SDIP in setting their rates.

            The last time Massachusetts waded into managed competition was three decades ago, and the result was not exactly what state leaders had intended. Consumers weren’t given much time to prepare for the change in early 1977, and premiums shot up more than 25% for some motorists. Lawmakers quickly passed a law capping increases at 25% over 1976 levels, and in 1978, amid widespread discontent, Massachusetts reverted to a fully regulated system yet again.

            In 2005, then-Gov. Mitt Romney once again called for a more-competitive system, and in 2006, Gov. Deval Patrick promised during his campaign to increase competition to lower insurance rates. Last year, state Insurance Commissioner Nonnie Burnes, a Patrick appointee, began doing just that.

            To avoid the rate-spike problems of 1977, she capped any increase at 10% for the worst drivers, as well as forbidding insurance companies from using certain socioeconomic factors, including credit scores, in setting rates.

            The decision hasn’t been without controversy. Martha Coakley, the state’s attorney general, has called the new system “confusing” and frets that some drivers, even many with clean records, could face rate increases. But competition also opens up a world of price incentives that allow drivers to shop for the plan that best suits their own circumstances. Among them are:

            • Accident forgiveness. “One difference is the disappearing deductible,” said Grinnell. “If you’ve been with a company for a certain number of years, if you have an accident with a $500 deductible, certain companies will forgive that deductible. And if you’ve owned a car for 10 months and it’s totaled, they might buy you a brand-new car, rather than one that’s depreciated by 10 months. Those little built-in bells and whistles are nice additions, but they’re not necessarily across the board.”

            • Elimination of ‘short-rate values.’ These are fees that insurers typically charge for early cancellation of a policy. But under the new system, some customers will not have to wait for their policies to expire to rework them or change companies altogether. “One way insurers are competing for your business under managed competition is by offering to waive or credit short-rate values. Others are rewarding customers who stay with them,” said Burnes. “You should check with your insurance agent to determine the insurance choices that are in your best interest.”

            • Discounts when someone insures both their house and vehicle with the same company. Not all insurers offer this incentive, and even when they do, there’s an important caveat. “Insurance companies can’t use your credit as an underwriting tool on auto insurance, but they can and do use it on home insurance,” said Phaneuf. “So, while it generally makes more sense now to have your home and auto insurance with the same company, it’s not always easy to place them with the same carrier if there’s an issue of bad credit.”

            In general, he added, “it’s more complicated now. You need an agency with a trained staff to guide you through the maze.” For that reason, area insurance agencies generally agree that the change to managed competition will be good for their business, because a more complex landscape should funnel more customers to them for help.

            “Is it going to be more confusing? Yes,” said Phaneuf. “Every company has different rates, policy features, and benefits. More than ever, people are going to need an independent agent to go to work for them.” At the same time, however, auto insurance has become more complicated for the agencies, too, meaning they’ll have to work to earn the extra business.

            “It’s going to make the agent’s job tougher than it was previously,” he continued. “In the past, there was one state-set rate, and we competed in areas other than rate — such as being local, having a professional, trained staff, and being involved in the community. Those are still critical areas, but we realize that price is important to customers.”

            Paris noted that motorists won’t always get all the information they need from advertisements and Web sites. “It is confusing, and the hype and advertising on television don’t tell the whole story,” she said. “They tell the good parts, but not the bad parts. Someone who had two accidents roll onto their driving record last year might call us, saying, ‘I can save all kinds of money,’ but the price actually went up.”

            Road Conditions

            Coakley has argued that the average auto insurance rate would have declined this year without managed competition, an assertion with which Phaneuf agreed. “So, whether managed competition is a good thing will take a couple of years to figure out,” he said. “Personally, I think a less-regulated market will be a good thing, particularly for good, responsible drivers.”

            Indeed, Burnes said drivers with clean records should see a 10% savings, on average, in the coming year, perhaps more if they shop around. The Division of Insurance is helping consumers do just that with a Web site (www.mass.gov/autorates) on which users can answer a few questions and generate a list of sample premiums being offered by the state’s 19 insurers (Progressive will increase that number to 20 next month).

            “When consumers use our site, they are struck by the huge variations in prices and discounts being offered by different companies, and it really motivates them to get serious about calling their agent and starting to comparison-shop,” Burnes said.  “The savings for good drivers has the potential to be significant, so it’s worth it for all consumers to do a little legwork.”

            BusinessWest has heard reports of confusion with the Web site, with some customers complaining that the rates quoted on the site don’t jibe with those quoted by an agent. Paris said agents expect questions and even some confusion, but they also see the value in giving consumers a choice.

            “It’s more complicated, and people who want to save money have to do a little homework,” said Grinnell. “But I think competition is a good thing, not just for consumers but for agents, too, because competition makes all of us better.”

            Sections Supplements
            Liability Coverage Is Critical to a Company’s Insurance Planning

            Running a business is an endless challenge to gain and keep customers, control expenses, outwit the competition, and keep a productive and efficient workforce. You also have to prepare for ordinary but potentially critical threats to your company’s survival: physical losses to your building, equipment, or cars; an injury to one of your workers; and, of course, the possibility of someone suing your company, alleging that an employee did something wrong or was negligent in some way.

            Fortunately, much of the impact of these ordinary but very real risks can be reduced or mitigated through the use of an insurance program that includes a general-liability policy and a property-insurance policy. Additionally, Massachusetts requires that corporations purchase workers’ compensation insurance, and also requires all automobiles to have liability insurance.

            With this full insurance planning in place, a business may be financially protected from the impact of most risks it faces. However, this ‘insurance confidence’ may be premature. The company still faces the critical exposure of a lawsuit brought on by an employee. In fact, statistics show that an employer is more likely to have an employment claim than a property or general-liability claim. And, unfortunately, a standard general-liability policy specifically excludes employer’s liability.

            It might be easy to think some types of ‘discrimination’ lawsuits happen only in large companies. Past results show this not to be accurate. A surprising 41% of all employment-practices liability claims are brought against small businesses consisting of 15 to 100 employees. However, many employers reason that they ‘know’ all their employees and this would not happen in their company. However, they do not know everyone they interview for a job, and those applicants can certainly claim discrimination.

            Necessary Measures

            Many business owners may believe that their general-liability policy will respond to any lawsuit brought against them. This is not the case. In order to have insurance coverage for this exposure, an employer needs to purchase an employment-practices liability-insurance (EPLI) policy.

            The EPLI policy has been developing over the past 10 years. It has grown to be more than a policy regarding sexual harassment. When evaluating a proposed EPLI policy, it is important to review the key elements to determine which are more favorable to your situation. The key elements of this type of policy are the acts that are covered, the types of damages covered, and the specifics of your defense.

            Insurance carriers that offer EPLI cover what are considered traditional wrongful-employment practices, such as discrimination, harassment, and wrongful termination. However, employment-practices law has evolved rapidly, and creation of additional causes of action can outpace the development of some insurance policies. Other covered acts to look for include failure to provide equal-employment opportunities, retaliatory discharge, employment-related misrepresentation, wrongful deprivation of career opportunity, wrongful failure to hire, and termination in breach of an implied contract.

            It is common for the EPLI policy to pay for compensatory damages. However, in these types of cases, any ruling of guilty can include fines, penalties, and punitive damages. You should be clear on the types of damages that are covered under the policy before you accept the proposal. You want to be sure that the policy will reimburse you for all the costs to defend the case, regardless of whether you win or lose. In the event the employee wins the suit, you want to be reimbursed for the judgment and settlement costs.

            It is probably true that the majority of employment practices claims are settled out of court. However, that does not mean that the legal costs to dispute a case are insignificant. It is reported that the average defense cost for an EPLI case is over $45,000.

            Because defense costs can be such a significant portion of the claim, it is important to understand how those costs impact the limits of the policy. In some cases there could be a separate limit for defense costs. Other carriers may include defense, judgment, and settlement costs all within one limit.

            Other Issues

            Another issue in regard to the defense of your employment-practices claim is your right to influence the defense attorney and that individual’s strategy. It is important to understand your ability to select or the input you have in the selection of the attorney defending your case. Under some policies, the attorney may be designated entirely by the insurance carrier.

            Another critical element of the defense is the settlement conditions. Some policies may require you to consent to the recommended settlement offer or you will forfeit the coverage provided. Other policies may impose a dramatic increase to your co-insurance percent.

            An employment-practices liability-insurance policy has many critical details that will make a real difference when a claim comes your way. In order to exercise the most influence over the many issues discussed here, you could purchase an EPLI ‘standalone’ policy. This would allow you greater flexibility over the terms of your policy. However, for those business owners whose insurance program consists of a business owner’s policy, many insurance companies now offer some optional EPLI coverage that may be added.

            It is important to discuss what options are available with your independent insurance agent. While it may be a little difficult now to work through the details of such an involved insurance policy, it will be time well-spent in the likely event of an employment-practices claim.

            Departments

            The following is a compilation of recent lawsuits involving area businesses and organizations. These are strictly allegations that have yet to be proven in a court of law. Readers are advised to contact the parties listed, or the court, for more information concerning the individual claims.

            CHICOPEE DISTRICT COURT

            Arnold’s Meats v. Iron Door Tavern
            Allegation: Non-payment of meat and food products received: $3,871.54
            Filed: 2-21-08

            Griffin Greenhouse Supplies Inc. v. Westover Greenhouse Inc.
            Allegation: Non-payment of goods received: $3,785.72
            Filed: 2-28-08

            Griffin Greenhouse Supplies Inc. v. Grandview Farms Inc.
            Allegation: Non-payment of goods received: $6,925.69
            Filed: 2-28-08

            State Lottery Commission v. Lacroix’s Market
            Allegation: Non-payment of services rendered: $21,377.96
            Filed: 2-28-08

            HAMPDEN SUPERIOR COURT

            Maria Silva v. Bertera Chrysler Jeep Inc.
            Allegation: Breach of contract: $20,000
            Filed: 2-15-08

            Richard Stanton v. Lauries Glass LTD
            Allegation: Negligence and breach of implied warranties causing injury: $13,365.75
            Filed: 1-22-08

            Superior Auto Transport, LLC v. Phil’s Auto Express
            Allegation: Breach of sales contract: $234,520
            Filed: 2-19-08

            The Sherwin Williams Company v. Engineered Floors Inc.
            Allegation: Non-payment of goods sold and delivered: $29,461.48
            Filed: 1-04-08

            HAMPSHIRE SUPERIOR COURT

            Karen Riley v. Magnat Rolls Inc.
            Allegation: Employment discrimination based on age and disability: $82,878
            Filed: 3-05-08

            Paul & Anne McGrath v. David Campbell Builders
            Allegation: Breach of construction contract and negligence causing fire: $138,281.14
            Filed: 2-29-08

            Scott & Lyndia Brough v. Zerteck Inc., d/b/a Boat-N-Ry Warehouse and Forest River Inc.
            Allegation: Breach of contract and fraud and deceit in sale of motor home: $165,000+
            Filed: 2-26-08

            Whiteway Construction Corporation v. Town of Tewksbury
            Allegation: Breach of contract for construction of Tewksbury Senior Center: $500,000+
            Filed: 2-28-08

            HOLYOKE DISTRICT COURT

            Minerva Lopez v. Holyoke Medical Center
            Allegation: Negligence in property maintenance causing personal injury: $24,476.75
            Filed: 3-07-08

            NORTHAMPTON DISTRICT COURT

            Diane Blahusch v. Remax Teamwork Realty
            Allegation: Breach of purchase and sale contract and professional negligence: $24,000.00
            Filed: 3-05-08

            New Penn Motor Express Inc. v. Johnson Metal Products Inc.
            Allegation: Non-payment of goods sold and delivered: $9,162.53
            Filed: 2-28-08

            Sherwood Lumber Company v. Eastern Lumber & Millwork Inc.
            Allegation: Non-payment of goods sold and delivered: $16,621.49
            Filed: 2-19-08

            Vaughn Munson v. Hotel Northampton
            Allegation: Breach of contract for snow removal: $3,800
            Filed: 2-26-08

            PALMER DISTRICT COURT

            Jeanne Rose v. Lowe’s Inc.
            Allegation: Negligence in property maintenance causing injury: $3,463.00
            Filed: 2-27-08

            Leonard’s of Connecticut Inc. v. The Livery
            Allegation: Non-payment of goods sold and delivered: $12,414.67
            Filed: 2-28-08

            SPRINGFIELD DISTRICT COURT

            Bradco Supply Corporation v. Mello’s Home Improvement
            Allegation: Non-payment of goods sold and delivered: $5,241.48
            Filed: 1-09-08

            PFG Springfield Corporation v. Brennan’s Inn
            Allegation: Non-payment of goods sold and delivered: $42,515.78
            Filed: 3-04-08

            Sunshine Village Inc. v. Superior Mechanical Contractors Inc.
            Allegation: Breach of contract for services: $20,000
            Filed: 2-14-08