Intentional Interference with Business Relationships

April 12, 2024

No causation or improper motive in tortious interference case

Where plaintiffs asserting a tortious interference with a business relationship claim could not show that the defendants intended to cause a breach or termination of the relationship, which had already been breached before defendants’ involvement, or that defendants acted with an improper motive, summary judgment for defendants was affirmed.

In Throckmorton v. Lefkovitz, No. M2022-01124-COA-R3-CV (Tenn. Ct. App. Feb. 29, 2024), plaintiff attorneys had previously represented clients in a property dispute in which clients’ goal was to be awarded the property at issue. Plaintiffs and clients had entered into a contingency fee agreement stating that clients would pay plaintiffs a percentage of the recovery, but recovery was not defined. After clients successfully obtained the property, plaintiff attorneys attempted to recover the percentage in the fee agreement based on a contract for the sale of the land that clients entered into. Clients contested that the amount sought was reasonable, and clients eventually hired defendant attorneys to represent them in the fee dispute.

Defendants advised clients to attempt to settle the dispute, and defendants engaged in settlement discussions with plaintiffs on behalf of clients. Defendants informed plaintiffs that if a settlement was not reached, clients would file for bankruptcy. Clients ultimately did file for bankruptcy, and through the bankruptcy process, plaintiffs and clients settled the fee dispute. Thereafter, plaintiff attorneys filed this case against defendant attorneys for tortious interference with a business relationship. The trial court granted defendants summary judgment, finding that the bankruptcy was a legitimate option, that defendants did not act with improper intent, and that there was no evidence that defendants “acted in self-interest.” Summary judgment was affirmed on appeal.

May 4, 2022

Revenge Porn

by The Law Offices of John Day, P.C.

My newest article, ” A New Arrow in the Quiver to Fight Revenge Porn,” has been published in the May/June edition of Tennessee Bar Journal.

An excerpt:

Now, a new federal law effective October 1, 2022, expands the rights of revenge porn victims and certain others by creating a federal cause of action that includes adults harmed by such conduct. The Violence Against Women Act Reauthorization Act of 2022, signed into law on March 16, creates a new federal right of action for a “depicted individual” (regardless of gender) against one who, in or affecting interstate or foreign commerce, discloses the “intimate visual depiction” of the identifiable plaintiff without their consent. The legislation applies to adults and minors. Certain disclosures are not actionable, including but not limited to disclosure of “commercial pornographic content” unless produced “by force, fraud, misrepresentation, or coercion of the depicted individual.”

March 9, 2022

Attorney’s fees allowed as compensatory damages in inducement of breach of contract case.

by The Law Offices of John Day, P.C.

Where the evidence clearly established the elements of intent and malice in an inducement of breach of contract case, summary judgment for plaintiff was affirmed. Moreover, the trial court’s ruling that plaintiff could recover attorney’s fees as compensatory damages under the independent tort theory was also affirmed.

In HCTEC Partners, LLC v. Crawford, No. M2020-01373-COA-R3-CV, 2022 WL 554288 (Tenn. Ct. App. Feb. 24, 2022), plaintiff was the former employer of defendant Crawford, who had worked for plaintiff in healthcare information technology recruitment. When Crawford was hired by plaintiff, he signed a “Confidentiality, Non-Competition, and Non-Solicitation Agreement,” which, among other things, provided that he would not work in the same field for 12 months after leaving plaintiff’s employment.

Defendant Rezult made Crawford a job offer while he was still working for plaintiff, which Crawford accepted. Plaintiff communicated to Rezult and Crawford about the Agreement, but Crawford was nonetheless placed in a position that involved healthcare information technology recruiting. Plaintiff thereafter brought this suit asserting breach of contract against Crawford and inducement of breach of contract against Rezult. After entering an injunction, the trial court granted plaintiff’s motion for summary judgment against both defendants, and the Court of Appeals affirmed.

September 25, 2019

Summary Judgment Affirmed on Negligent Misrepresentation Claim

by The Law Offices of John Day, P.C.

Where an attorney working for a bank gave the bank president advice about his resignation but also recommended that he seek independent counsel, the Court of Appeals affirmed summary judgment on a negligent misrepresentation claim.

In Batten v. Community Trust and Banking Company, No. E2017-00279-COA-R3-CV (Tenn. Ct. App. Aug. 26, 2019), plaintiff was the president and CEO of defendant bank. Plaintiff had an employment contract with the bank that included a provision allowing him to resign and receive 36 months of additional compensation. When the Tennessee Department of Financial Institutions (TDFI) examined the bank, it found serious problems, eventually declaring that the bank was in a troubled condition.

May 2, 2017

The Latest Intentional Interference with Business Relationships Decision

by The Law Offices of John Day, P.C.

In Clear Water Partners, LLC v. Benson, No. E2016-00442-COA-R3-CV (Tenn. Ct. App. Jan. 26, 2017), the Court of Appeals reversed dismissal of a claim for intentional interference with business relationships and civil conspiracy. The Tennessee court concluded that a current contractual relationship was not an automatic bar to an intentional interference with contractual relationships claim.

Plaintiff had an option contract to purchase and develop 111 acres of land, with the purchase being “contingent on the approval of a development plan, obtaining rezoning approval, and the performance of certain site development work.” Plaintiff also had a contract to sell Paul Murphy around 30 acres of the property once the option had been executed. According to plaintiff, the 23 named individual defendants used “improperly motivated conduct and/or improper means” to delay and oppose the rezoning and the approval of the development plan, causing Mr. Murphy to “void” his contract with plaintiff. Subsequently, plaintiff entered into another contract to sell the 30 acres to Belle Investments, but that contract required plaintiff to make some changes to its plan and incur damages.

As plaintiff continued to work towards rezoning and approval of its project, plaintiff alleged that the Defendants “individually and through their attorney/agent, ‘vigorously opposed’ its rezoning application and development plans.” Plaintiff alleged that defendants created false email accounts to make it look like residents near the development were emailing the County Commission, that one defendant sent a flyer containing false information home with the students at an elementary school, that one defendant gave a flyer with false information to nearby residents, and that an affidavit containing false information was given to the planning commission and zoning board, among other allegations. Plaintiff’s fight with defendants wound its way through the planning commission and zoning board, the circuit court, and even included an appeal to the Court of Appeals. At the time of plaintiff’s filing of the complaint in this case, the circuit court had upheld the zoning board’s decision to approve the development plan and deny part of the rezoning request.