Tennessee Court of Appeals Rejects Claim For Intentional Interference with Business Relations

Tennessee courts recognize a claim for intentional interference with business relations, but this multi-year dispute did not end well for the claimant.

In Stratienko v. Chattanooga-Hamilton County Hospital Authority, No. 2011-01699-COA-R3-CV (Tenn. Ct. App. Nov. 21, 2013),the Tennessee Court of Appeals affirmed dismissal of a plaintiff doctor’s claim for intentional interference with business relations. The case has a substantial procedural history, having been previously appealed through the Tennessee Court of Appeals to the Tennessee Supreme Court, as well as to the Sixth Circuit Court of Appeals in an almost identical federal suit. In sum, the case stems from an alleged physical altercation in 2004 between Dr. Stratienko and another doctor in the break room of hospital owned and operated by the defendant Chattanooga-Hamilton County Hospital Authority.

Before addressing the claim for intentional interference of business relations, the Stratienko court rejected the plaintiff’s contention that the trial court had incorrectly dismissed on summary judgment his other claims for breach of contract, inducement of breach of contract, conspiracy, and immunity. The plaintiff argued that there were disputed facts regarding the physical altercation, the investigation of the incident, and the plaintiff’s subsequent suspension. The Court of Appeals, however, observed that the federal district court and the Sixth Circuit had previously made findings of fact relative to the incident, investigation, and suspension, and those findings constituted the law of the case. Under Tennessee’s law of the case doctrine, an appellate court’s decision (state or federal) on an issue of law is binding in later trials and appeals of the same case if the facts on the second trial or appeal are substantially the same as the facts in the first trial or appeal. See Life & Casualty Ins. Co. v. Jett, 133 W.W.2d 997, 998-99 (Tenn. 1939). Therefore, the Court of Appeals refused to reconsider the facts at issue.

            When bringing a claim for intentional interference with a business relationship, the plaintiff must establish the following five elements: (1) an existing or prospective business relationship with a specific third party; (2) the defendant’s knowledge of that specific relationship and not mere awareness of the plaintiff’s dealing with others in general; (3) the defendant’s intent to cause the breach or termination of the business relationship; (4) the defendant’s improper motive or improper means; and (5) damages resulting from the tortious interference. See Trau-Med of America, Inc. v. Allstate Ins. Co., 71 S.W.3d 691, 701 (Tenn. 2002). The Court of Appeals affirmed the trial court’s decision that the plaintiff had failed to prove any of the elements for his claim for intentional interference with a business relationship, with the largest failures concerning the “improper motive or improper means” and damages elements.

The claim was based on the notion that other doctors and the hospital enticed Dr. Stratienko’s patients away from him as a result of the altercation. But Dr. Stratienko could not show that the primary purpose of the defendant’s conduct was to injure the plaintiff, as required under Tennessee law to establish the motive and means element. Common examples of improper interference include violations of statutes or regulations, violence, threats, bribery, fraud, defamation, and misuse of inside or confidential information, and Dr. Stratienko did not provide any evidence of comparable conduct. At most, the evidence indicated an overlap in the doctors’ desires for patient business.

Lastly, Dr. Stratienko claimed that he suffered economic damages as a result of the harm inflicted on his business relationships, but the proof actually showed that his business had performed better financially in some instances than previously before the altercation. The Court of Appeals also questioned the plaintiff’s expert’s estimation of Dr. Stratienko’s damages because the expert did not consider the number of procedures the plaintiff performed in a given year and the plaintiff’s revenue was in fact based on the number of procedures conducted in any given year.

For more cases on the topic of intentional interference with business relations in Tennessee, click on the link.