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Arabian Support & Services Company, Ltd. v. Textron Systems Corp.

United States Court of Appeals, First Circuit

November 20, 2019

ARABIAN SUPPORT & SERVICES COMPANY, LTD., Plaintiff, Appellant,
v.
TEXTRON SYSTEMS CORPORATION, Defendant, Appellee.

          APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MASSACHUSETTS [Hon. Patti B. Saris, U.S. District Judge]

          Martin F. Gaynor III, with whom Haig V. Kalbian, D. Michelle Douglas, William P. McGrath, Jr., Kalbian Hagerty LLP, Nicholas D. Stellakis, and Hunton Andrews Kurth LLP were on brief, for appellant.

          John A. Tarantino, with whom Nicole J. Benjamin and Adler Pollock & Sheehan P.C. were on brief, for appellee.

          Before Lynch, Selya, and Lipez, Circuit Judges.

          LYNCH, CIRCUIT JUDGE

         The international arms trade provides the background for this appeal. Arabian Support & Services Co. ("ASASCO"), a Saudi Arabian consulting company, sued Textron Systems Corporation ("Textron"), a Massachusetts-based defense contractor, on various Massachusetts state law claims. Underlying them all was the assertion that Textron represented that ASASCO's compensation for assisting Textron in securing the sale of sensor fuzed weapons ("SFWs") to Saudi Arabia would include payments resulting from ASASCO's efforts to obtain an "offset waiver" or "offset credits" for Textron associated with that sale. That payment allegedly would be a fee and/or a percentage of the final Textron contract with Saudi Arabia.

         ASASCO's 2017 amended complaint asserted violation of Massachusetts General Laws chapter 93A, fraudulent inducement, intentional misrepresentation, negligent misrepresentation, quasi-contract/implied contract/promissory estoppel, and quasi-contract/unjust enrichment/quantum meruit. We affirm the district court's entry of summary judgment for Textron, relying largely on the district court's able opinion. Arabian Support & Servs. Co. v. Textron Sys. Corp., 368 F.Supp.3d 211 (D. Mass. 2019) (Textron II).

         I.

         In recounting the facts, we rely in substantial part on the district court's opinion and our prior decision, Arabian Support & Services Co. v. Textron Systems Corp., 855 F.3d 1 (1st Cir. 2017) (Textron I). We describe the key events over the parties' thirteen-year relationship in chronological order.

         A. Facts

         Textron was interested in selling SFWs to Saudi Arabia. The relationship between Textron and ASASCO largely developed through the interactions of Mansour Al-Tassan, ASASCO's President, and Avedis Boyamian, Textron's Director of Middle East Business Development. Starting in 2001, Al-Tassan and Boyamian discussed various methods of paying ASASCO for its assistance in furthering a SFW sale, including through a fixed monthly fee or through the formation of a joint venture.

         In March 2004, Textron engaged the International Law Firm in Riyadh to ensure that its contemplated relationship with ASASCO would be legal under Saudi law. On July 8, 2004, Robert Kemp, Textron's General Counsel, inquired about the legality of paying ASASCO "on a commission basis." The International Law Firm advised Kemp on September 1, 2004, that such a relationship had a "significant risk" of being prohibited under Saudi law.

         On September 28, 2004, Boyamian and Al-Tassan met in Cairo. Boyamian told Al-Tassan that Textron was willing to pay ASASCO up to five percent of the value of the SFW deal but that the agreement between the companies must conform to U.S. and Saudi law. ASASCO alleges that on November 6, 2004, at a meeting in Saudi Arabia, Boyamian represented to Al-Tassan that Textron would use "offsets"[1] in order to pay ASASCO lawfully for its services if Textron obtained the SFW sales contract with Saudi Arabia.

         In 2005, Textron and ASASCO executed the first of what would be five consulting agreements. The first three agreements, each lasting one year during the time period from 2005 to 2008, provided ASASCO with a monthly retainer of $10, 000 for its services regarding the sale of Textron's SFWs to the Royal Saudi Air Force.[2]

         Throughout 2006, Boyamian and Al-Tassan further discussed the opportunity for ASASCO to receive compensation for its assistance with any offset projects. Textron's position with ASASCO was that "[a]ll such activity must result in Saudi Gov't approval of offset projects, grant credits/or waive requirement."

         In June 2006, Textron sent ASASCO a draft offset provider agreement.[3] Later at deposition, Boyamian described the offset discussions and the consulting agreements as "totally separate." On June 26, 2006, Boyamian also forwarded Al-Tassan internal Textron emails that ordered that ASASCO's business with Textron be recorded separately as "two books" -- one for the proposed offset agreement and one for a ...


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