Opinion
CAUSE NO. IP 01-358-C H/K
February 18, 2004
ENTRY ON MOTIONS FOR SUMMARY JUDGMENT
Plaintiff John Blubaugh has sued defendant American Contract Bridge League (ACBL) on a variety of theories arising from the ACBL's decision to suspend him from playing in ACBL-sanctioned tournaments for a period of 18 months. Blubaugh has made his living in recent years as a professional bridge player. After a question was raised about the manner in which Blubaugh shuffled and dealt cards in tournaments, the ACBL's Ethical Oversight Committee held a hearing with witnesses, exhibits, cross-examination and counsel. The committee issued a written decision finding that Blubaugh had violated bridge rules. The committee suspended him from sanctioned bridge play for four months. Blubaugh appealed to the ACBL's Appeals and Charges Committee, which upheld the findings but enhanced the punishment to an eighteen month suspension.
Blubaugh filed this action on March 15, 2001, and moved for a temporary restraining order to prevent the suspension from taking effect. After a hearing on March 16, 2001, the court orally denied such relief. Blubaugh then filed two amended complaints and a motion for preliminary injunction seeking to have the suspension lifted. After a hearing on Blubaugh's motion for a preliminary injunction, the court denied the motion. Blubaugh v. American Contract Bridge League, 2001 WL 699656 (S.D. Ind. June 20, 2001).
Blubaugh's third amended complaint contains no fewer than 19 counts that can be grouped as follows. Breach of Contract Counts I, IX, X, XI, XII, XIII, XIV, XV, and XVI allege that the ACBL breached a contract with Blubaugh by failing to honor its own internal rules and regulations, specifically the Code of Disciplinary Regulations and Guidelines for Disciplinary Proceedings. Tortious Interference: Count II alleges that the ACBL, by suspending Blubaugh, tortiously deprived him of his livelihood. Indiana does not recognize a cause of action for "tortious deprivation of livelihood," so the court construes this count to allege tortious interference with a business relationship, which can be actionable under Indiana law. Count III sets forth a claim of tortious interference with contract based on the same conduct complained of in Count II. Defamation: Counts IV and XX allege defamation, and Count V alleges a conspiracy to defame. Blubaugh claims that various statements regarding the disciplinary proceedings made by the ACBL or those associated with it were defamatory.
Although Blubaugh's final claim is styled "Count XX", there are actually only 19 counts in the complaint. No "Count XIX" appears in the complaint.
Miscellaneous Claims: Count VI alleges that the ACBL was grossly negligent in its handling of a surveillance videotape that was used as evidence in the disciplinary proceedings against Blubaugh. The videotape contained a recording of Blubaugh shuffling and dealing cards at a national tournament. Count VII alleges a violation of the Americans with Disabilities Act, but Blubaugh has abandoned that claim in response to the ACBL's motion for summary judgment. Count VIII alleges a violation of the federal Sherman Antitrust Act. Count XVII alleges a violation of the Racketeering and Corrupt Organizations Act (RICO). Finally, Count XVIII advances an abuse of process claim.
The court has jurisdiction based on diversity of citizenship and the amount in controversy. Although the complaint contains three counts arising under federal law, they are so weak as to provide only meager support for federal jurisdiction. See, e.g., Williams v. Aztar Indiana Gaming Corp., 351 F.3d 294, 299 (7th Cir. 2003) (finding that federal RICO claim was so frivolous as not to support supplemental jurisdiction overstate law claims where citizenship was not diverse).
Summary Judgment Standard
The ACBL has moved for summary judgment on each count. Blubaugh has also moved for summary judgment on liability on his claims for breach of contract and abuse of process. The purpose of summary judgment is to "pierce the pleadings and to assess the proof in order to see whether there is a genuine need for trial." Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986). Summary judgment is appropriate when there are no genuine issues of material fact, so that the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c). The moving party must show there is no genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). "If the nonmoving party fails to establish the existence of an element essential to his case, one on which he would bear the burden of proof at trial, summary judgment must be granted to the moving party." Ortiz v. John O. Butler Co., 94 F.3d 1121, 1124 (7th Cir. 1996).In light of Blubaugh's briefs, which focus on myriad trivial details and irrelevant history, it is worth emphasizing that a factual issue is material only if resolving the factual issue might change the suit's outcome under the governing law. Irrelevant or unnecessary facts do not deter summary judgment, even when in dispute. Clifton v. Schafer, 969 F.2d 278, 281 (7th Cir. 1992). A factual issue is genuine only if there is sufficient evidence for a reasonable jury to return a verdict in favor of the non-moving party on the evidence presented. Anderson v. Liberty Lobby, Inc., 477 U.S. 242,248 (1986). In considering defendants' motion, the court must consider the evidence in the light reasonably most favorable to the opposing party, giving him the benefit of the most favorable reasonable inferences from the evidence. See Fed.R.Civ.P. 56(c); Anderson, 477 U.S. at 255; Celotex, 477 U.S. at 323; Baron v. City of Highland Park, 195 F.3d 333, 337-38 (7th Cir. 1999).
For the reasons explained below, the court grants defendant's motion for summary judgment in all respects. Though all of Blubaugh's claims have specific flaws that are discussed below, the central defect running throughout the Complaint lies in Blubaugh's erroneous and expansive view of the court's role in overseeing the internal affairs of a voluntary membership organization like the ACBL. At the core of this case, Blubaugh contends the suspension imposed on him is simply unjust. He asserts his suspension resulted both from violations of the ACBL's rules and procedures and from personal malice on the part of some ACBL leaders with whom he has had some bitter conflicts over the years.
Indiana courts, however, exercise only very limited judicial oversight of voluntary membership organizations like the ACBL. Blubaugh has not shown that his case fits the limited exceptions for fraud, other illegality, or abuse of civil or property rights having their origin elsewhere. See Indiana High School Athletic Ass'n v. Reyes, 694 N.E.2d 249, 256 (Ind. 1997). Nor has he shown any material violation of the ACBL's elaborate rules and procedures. Although Blubaugh contends he is the victim of a prolonged and concerted effort to harm him unjustly, he simply has not come forward with evidence that would allow a reasonable jury to find that such an effort was made.
The Seventh Circuit has often said that summary judgment is the "put up or shut up" moment in a lawsuit, when a party must show what evidence he has that would convince a trier of fact to accept his version of events. Johnson v. Cambridge Industries, Inc., 325 F.3d 892, 901 (7th Cir. 2003). On this record, it would be a "gratuitous cruelty" to the parties and their witnesses, not to mention the jurors, to go through the ordeal of a trial that could have only one outcome. Mason v. Continental Illinois Nat'l Bank, 704 F.2d 361, 367 (7th Cir. 1983).
Undisputed Facts
Keeping in mind the standard on a motion for summary judgment, the following facts are undisputed or reflect the evidence in the light reasonably most favorable to Blubaugh, as the party opposing the principal motion for summary judgment. The ACBL serves as the sanctioning body for competitive and duplicate bridge in North America. Blubaugh has made his living since 1990 or 1991 as a professional bridge player. Bridge is a team game, and some devoted amateurs are willing and able to pay excellent bridge players like Blubaugh to play as their partners in bridge tournaments that do not offer monetary prizes. Blubaugh has also established a modest business in which he brokers such arrangements between such paying clients and other professional players in return for a fee. Most if not all of these tournaments are sanctioned by the ACBL.
In 2000, Blubaugh's primary client was a Mr. Villman, who paid Blubaugh $2,250 per tournament pursuant to an oral agreement. Blubaugh was negotiating a similar arrangement for 2001 with Gerald Mindell while the disciplinary process was going forward. These negotiations were abandoned when Blubaugh was suspended.
Blubaugh is a member of the ACBL and has been active in its national leadership, including past membership on its national board of governors and its Appeals and Charges Committee, which was the same body that increased his suspension from four to eighteen months. Over the years, he has been an outspoken critic of others in leadership positions with the ACBL and the World Bridge Federation. For example, he has criticized what he views as excessive travel expenses for ACBL directors and their spouses. He also was critical of the appointment in 1999 of Michael Aliotta to the position of national recorder.
At a regional ACBL bridge tournament in Indianapolis during the summer of 2000, the ACBL received information from James Chiszar that he believed he had observed Blubaugh deliberately placing an ace or other "honor card" at the bottom of a deck, shuffling the deck in such a way as to keep the ace at the bottom of the deck throughout the shuffles, and then putting the ace in the hand given to his partner. Chiszar, who was an ACBL tournament director, reported his observations to several other directors attending the Indianapolis tournament. They all agreed to observe Blubaugh the next day. The next day, Chiszar and directors Johnson, Van Cleve and Flader observed Blubaugh. Of the four, three believed they observed Blubaugh manipulate the shuffle so as to place an ace on the bottom of the deck where it would be dealt to his partner.
If one member of a bridge team knows that his partner holds a specific card, that knowledge can provide their team with a modest but unfair advantage in the competition.
Following the Indianapolis tournament, the ACBL arranged for video surveillance of Blubaugh as he shuffled and dealt at the national tournament in Anaheim, California in August 2000. Based on the videotape and the directors' observations, the ACBL's chief tournament director Gary Blaiss, national recorder Richard Colker, and league counsel Jeffrey Polisner agreed that the evidence was sufficient to institute charges against Blubaugh for cheating.
Blubaugh was formally charged on August 12, 2000, with manipulating honor cards to the bottom of the deck and knowing into which hands he dealt them at the Indianapolis Regional tournament on July 29-30, 2000, and the Anaheim NABC tournament on August 10-11, 2000. The charge specified violations of Sections 2.1, 2.2 and 2.11 of the ACBL's Code of Disciplinary Regulations and the ACBL's Laws 6 and 16. Blubaugh was notified of a hearing scheduled for August 16, 2000, before the ACBL's Ethical Oversight Committee. The notice informed him of his rights under ACBL rules to have "counsel" (who was not required to be an attorney), to present evidence, to confront witnesses, and to challenge any committee member for cause. He was also informed that any appellate bodies that might review a decision by the Ethical Oversight Committee had the power, among others, to increase any discipline imposed.
At Blubaugh's request, the hearing before the Ethical Oversight Committee was postponed to November 17, 2000, at a tournament in Birmingham, Alabama. Blubaugh's counsel obtained the four-month delay by explaining that he needed time to gather evidence relating to Blubaugh's earlier injuries and their effects.
Blubaugh suffered an injury to his right hand approximately 20 years ago. His right ring finger was amputated just above the last knuckle, and that finger is stiff and virtually useless. He also suffered nerve damage to his middle finger that reduces its function. Also, over the last several years, also, Blubaugh's vision in his right eye has deteriorated, especially his peripheral vision. Blubaugh contends that his hand injuries cause his shuffling of cards to be clumsy and awkward and not very effective in mixing the cards of the deck, but that his restricted vision keeps him from actually seeing the face of any card when he shuffles. Blubaugh vehemently denies that he knew the positions of any cards in the shuffled decks or that he knowingly gave his partner any particular cards.
Before the hearing, Blubaugh's counsel attempted to obtain the equivalent of pretrial discovery from the ACBL, including the identities of witnesses and the substance of any expert witness testimony. The ACBL rules make such pre-hearing disclosures optional rather than mandatory. The ACBL provided only a copy of the surveillance videotape before the hearing, without explanation or expert commentary.
A committee composed of members of the Ethical Oversight Committee convened to hear evidence on November 17, 2000. Blubaugh did not try to have any members removed for cause. Witnesses in the hearing were not under oath, nor was a complete record of the hearing made. The Recorder of the ACBL presented evidence against Blubaugh, including the videotape as narrated and explained by Norman Beck, who was presented as an expert in cards and their manipulation. The written reports of Beck, Chiszar and others who had observed Blubaugh's conduct during the tournaments were also introduced into evidence. Blubaugh's counsel cross-examined the witnesses against him. Blubaugh's counsel did not ask those witnesses any questions about Blubaugh's hand injury or its effects. After the ACBL presented its evidence, the committee took a prolonged recess to play bridge, then reconvened late that same night and heard evidence from Blubaugh and witnesses he called. Both sides indicated they were through presenting evidence. At 4:30 a.m. on November 18th, the committee announced its ruling against Blubaugh and the sanction of a four month suspension.
Blubaugh appealed that decision to the ACBL's Appeals and Charges Committee. The suspension was stayed pending that appeal. After the Ethical Oversight Committee's decision but before the decision of the Appeals and Charges Committee, "D" Magazine, a local Dallas/Fort Worth magazine published an article profiling Norman Beck, the expert on card manipulation who had testified against Blubaugh at the disciplinary hearing. In the article, Beck was quoted at length discussing the Blubaugh case, although neither he nor the article mentioned Blubaugh by name. The article also contained a brief description of the surveillance videotape, which Beck apparently had shown the author.
On Blubaugh's appeal, the ACBL's Appeals and Charges Committee decided to sustain the finding of a violation and to increase the suspension to eighteen months, to take effect in March 2001. In conjunction with the decision, the ACBL published a notice of Blubaugh's suspension in its news bulletin. Blubaugh filed this action on March 15, 2001. After this court denied a temporary restraining order, the suspension took effect as scheduled.
The parties have stipulated to the admission of a copy of surveillance videotape showing Blubaugh shuffling and dealing several hands of bridge. When it was presented to the ACBL's Ethical Oversight Committee, witness Norman Beck provided a narration and explanation, as well as a written report. At the request of plaintiff, the court has watched the videotape. Without commentary, explanation, and questioning by those expert in the game of bridge, however, the videotape was not enlightening. The task of this court is not to try de novo the case against Blubaugh before the ACBL's Ethical Oversight Committee.
Both the videotape and Blubaugh's testimony show that, before Blubaugh shuffles a deck, he habitually holds the entire deck of cards face-up in a fan-like arrangement that allows him to see all the cards, including the cards that will be at the very bottom of the deck before it is shuffled. Blubaugh testified that he views the cards this way to ensure that all the cards are facing the same way. If a card is dealt face-up, the dealer must reshuffle the deck and start over. (Blubaugh has not explained why he could not make that same determination by holding the cards face-down, without seeing which cards would be at the bottom of the deck. Also, the court is left to wonder why bridge players do not "cut" a shuffled deck before a deal to prevent precisely the sort of problems that arose here.)
Lest there be any misunderstanding, for purposes of deciding the ACBL's motion for summary judgment, the court assumes that Blubaugh did not actually cheat in his shuffling and dealing, even though ACBL officials believed that he did. Nonetheless, the evidence here would not allow any reasonable jury to find that any ACBL officials who reviewed the evidence in the case and made a decision at any stage — the initial charging decision, the initial hearing, or the appeal — subjectively believed that Blubaugh was innocent of cheating.
Other facts are noted below as needed, keeping in mind the standard for a summary judgment motion.
Discussion
I. Breach of Contract — Counts I, IX, X, XI, XII, XIII, XIV, XV, and XVI
Judicial review of the internal affairs and rules of voluntary membership associations like the ACBL is limited under Indiana law. In Indiana High School Athletic Association v. Reyes, 694 N.E.2d 249 (Ind. 1997), the Indiana Supreme Court reaffirmed the general rule that Indiana courts will not interfere in the governance of such a private organization, such as its interpretation and administration of rules governing membership and discipline. Id. at 256, citing State ex rel. Givens v. Superior Court of Marion County, 117 N.E.2d 553, 555 (Ind. 1954) (declining to exercise authority over union election dispute). The Indiana court recognized certain limited exceptions to the general rule. One is a decision by the voluntary membership association that infringes upon a personal liberty or property right having origins outside the association itself. 694 N.E.2d at 256, citing Givens, 117 N.E.2d at 555, and other cases. A second exception applies when the association's decision constitutes fraud or other illegality. 694 N.E.2d at 256, citing Randolph v. Leeman, 146 N.E.2d 267, 272 (Ind.App. 1957).
The Reyes court then addressed several opinions by the Indiana Court of Appeals suggesting that another exception could apply if the voluntary membership association applied its rules in an arbitrary, discriminatory, or malicious manner, or if it failed to apply rules requiring due process. 694 N.E.2d at 256, citing United States Auto Club v. Woodward, 460 N.E.2d 1255, 1261 (Ind.App. 1984), and Terrell v. Palomino Horse Breeders of America, 414 N.E.2d 332, 335 (Ind.App. 1980). The response of the Indiana Supreme Court to these suggestions could not have been clearer:
We reject additional exceptions to the rule. Absent fraud, other illegality, or abuse of civil or property rights having their origin elsewhere, Indiana courts will not interfere in the internal affairs of voluntary membership associations. This means, inter alia, that Indiana courts will neither enforce an association's internal rules, State ex rel. Givens, 233 Ind. at 239, 117 N.E.2d at 555, nor second guess an association's interpretation or application of its rules, see [Crane v. Indiana High School Athletic Ass'n, 975 F.2d 1315, 1329 (7th Cir. 1992) (Posner, J., dissenting)].694 N.E.2d at 256.
In an effort to avoid the effect of Reyes, Blubaugh suggests that the ACBL's disciplinary rules amount to a fraud, so that increased judicial scrutiny of the ACBL's decision to suspend him is permissible under Reyes. Specifically, Blubaugh contends that the ACBL's rule authorizing pre-hearing discovery discretionary is fraudulent because the ACBL has indicated that it will never consider granting pre-hearing discovery of documents. Pl. Br. at 26. As evidence for this proposition, Blubaugh cites the ACBL's discussion of his Sherman Act claim in its brief in support of summary judgment. The cited passage, however, merely illustrates the ACBL's rationale for not adopting mandatory pre-hearing discovery. See Def. Br. at 46. How Blubaugh proceeds from this innocuous passage to his far broader claim that the ACBL will never grant pre-hearing discovery is a mystery to the court.
More generally, Blubaugh seems to be arguing that the ACBL's behavior is fraudulent because in his view the ACBL has failed to follow faithfully its own internal rules. If the court were to accept this circular definition of fraud, it would render Reyes a nullity. The central point of Reyes is that, barring extraordinary situations not present here, courts will not interfere in a voluntary association's interpretation and application of its own internal rules. Fraud is of course one of those extraordinary situations, but for the rule to have any meaning, the threshold for the exception must be set higher than just a complaint about the manner in which the association applies its own rules.
Under Indiana law, actual fraud requires the plaintiff to show that he was injured as a result of his justifiable reliance on a material misrepresentation of past or present fact and that the misrepresentation was made with knowledge of its falsity and in an effort to induce reliance. A.I. Credit Corp. v. Legion Ins. Co., 265 F.3d 630, 635 (7th Cir. 2001), citing Baxter v. I.S.T.A. Ins. Trust, 749 N.E.2d 47, 52 (Ind.App. 2001). Blubaugh's evidence would not allow a reasonable jury to find that the ACBL intentionally misrepresented its own rules or policies. Also, under Indiana law, a claim for actual fraud cannot be founded on promises of future performance. E.g., Eby v. York-Division, Borg-Warner, 455 N.E.2d 623, 628 (Ind.App. 1983).
Without actually developing any argument on the point, Blubaugh asserts at pages 23-24 of his brief that Reyes does not apply here because the ACBL is incorporated in New York, so that New York law rather than Indiana law should govern. The only case that Blubaugh cites on his choice-of-law argument is a district court case arising from the famous Tonya Harding figure-skating controversy relating to the 1994 Winter Olympics. The cited opinions do not address choice-of-law issues at all. See Harding v. United States Figure Skating Ass'n, 851 F. Supp. 1476 (D. Or. 1994); Harding v. United States Figure Skating Ass'n, 879 F. Supp. 1053 (D. Or. 1995). As a form of self-defense, federal courts may treat contentions as waived when they are presented in such cursory fashion. E.g., Tenner v. Zurek, 168 F.3d 328, 330 (7th Cir. 1999); Kauthar SDH BHD v. Sternberg, 149 F.3d 659, 668 (7th Cir. 1998) ("It is not the obligation of this court to research and construct the legal arguments open to parties. . . ."). That is the case here on this choice-of-law contention.
In any event, there is only a weak foundation for applying New York law here. This court must apply Indiana's choice of law rules. See Klaxon Co. v. StentorElec. Mfg. Co., 313 U.S. 487 (1941). Indiana applies a "most intimate contracts" approach to contract claims. See W.H. Barber Co. v. Hughes, 63 N.E.2d 417, 423 (Ind. 1945); Hartford Accident Indent. Co. v. Dana Corp., 690 N.E.2d 285, 291 (Ind.App. 1997); DohmNelke v. WilsonFoods Corp., 531 N.E.2d 512, 513 (Ind.App. 1988). Many states have contacts with Blubaugh's dispute with the ACBL, but the only New York contact is that ACBL is incorporated under New York law. Indiana courts regard place of incorporation as providing only a minimal contact to the dispute. See, e.g., Employers Ins. of Wausau v. Recticel Foam Corp., 716 N.E.2d 1015, 1025 (Ind.App. 1999), citing Restatement (Second) of Conflict of Laws § 188 cmt. e (1971) (a corporation's principal place of business is a more important contact than the corporation's place of incorporation). That contact pales when compared to the Indiana contacts in this case. Indiana is where Blubaugh's unusual shuffling and dealing were first observed. It is the location of his residence and business, and the location of any harm he suffered.
Further, the court has reviewed Blubaugh's detailed allegations of violations of the ACBL's internal rules and procedures. Even if the court had authority to enforce those rules and procedures, Blubaugh's allegations would not support relief. Some of the alleged violations are not violations of the rules at all. For example, pre-hearing discovery and tape-recording of the hearing were not mandatory. See Counts I, XIV, and XV. The other alleged violations were trivial and harmless, and/or Blubaugh waived them by failing to make objections before the ACBL when it would have been possible to correct the supposed errors. For example, Blubaugh challenged no committee members for cause, though he accuses some of bias now. See Counts IX, XIII, and XVI. He also objects to the specific procedures used to initiate the ACBL proceedings, but he did not raise those objections before the ACBL, when the alleged errors could have been corrected. See Counts X, XI, and XII.
Accordingly, the ACBL is entitled to summary judgment on Counts I, IX, X, XI, XII, XIII, XIV, XV, and XVI, which all attempt to allege breaches of contract.
II. Interference with Contracts and Business Relationships — Counts II II I
Blubaugh alleges in Count III that he had valid and enforceable contracts with Mr. Villman and Mr. Mindell to be paid for playing with them in bridge tournaments. He claims that the ACBL tortiously interfered with these contracts. In Indiana, a plaintiff claiming tortious interference with a contract must prove: (1) the existence of a valid and enforceable contract; (2) that the defendant knew of the contract; (3) that the defendant intentionally induced a breach of the contract; (4) that the defendant acted without justification; and (5) that damages resulted from the defendant's wrongful inducement of the breach. Winkler v. V. G. Reed Sons, Inc., 638 N.E.2d 1228, 1235 (Ind. 1994).
The court assumes for purposes of summary judgment that Blubaugh had a valid oral contract with Mr. Villman that ran through 2000. The goal of the contract was for Villman to play bridge with a professional player for one year so that he could accumulate enough master points to win his division. The contract was fully performed at the end of 2000 when Villman achieved this goal. Blubaugh's suspension, however, did not begin until March 14, 2001. Even though the Ethical Oversight Committee had found him guilty of cheating in November 2000, his suspension was stayed pending his appeal. The delay allowed him to play with Villman in the final tournament of the year. A reasonable jury would be unable to find that the ACBL interfered with Blubaugh's contractual rights because Blubaugh's contract with Villman was fully performed before the disciplinary action took effect. See Computers Unlimited, Inc. v. Midwest Data Systems, Inc., 657 N.E.2d 165, 168 (Ind.App. 1995) (affirming grant of summary judgment where contract was terminated before the alleged interference occurred).
Blubaugh also has failed to come forward with sufficient facts that would allow a reasonable jury to conclude that he had a contract with Mr. Mindell. Blubaugh was in negotiations with Mindell to partner for 2001, but Blubaugh concedes that no contract with Mindell or any other client existed at the time of his suspension. Absent an actual contract, Blubaugh's claim for tortious interference with contract fails.
Mindell sent a letter of intent on October 10, 2000, see Def. Ex. 9, but it did not constitute an enforceable contract. The letter alluded to the terms then being negotiated between Blubaugh and Mindell and concluded: "Please accept this letter as an indication of my present intent to accept your proposal, subject, of course, to our ability to work out the terms of a written agreement satisfactory to both parties including working out an acceptable tournament schedule that will accommodate my personal schedule." The letter manifests neither the parties' intent to be bound nor definite terms of the agreement. See Wolvos v. Meyer, 668 N.E.2d 671 (Ind. 1996). No agreement exists where the parties expressly state that they do not intend to be bound until a second writing or subsequent formalization is executed. Foster v. United Home Improvement Co., 428 N.E.2d 1351, 1355 (Ind.App. 1981); International Shoe Co. v. Lacy, 53 N.E.2d 636, 638 (Ind.App. 1944) ( en banc).
Given the facts of this case, it is also beyond dispute that the ACBL was justified in the action that Blubaugh claims was an unlawful interference. Indiana has adopted the Restatement approach to determine whether a defendant's conduct in intentionally interfering with a contract is justified. See Winkler, 638 N.E.2d at 1235. The Restatement states that the following factors should be considered: (1) the nature of the defendant's conduct; (2) the defendant's motive; (3) the interests of the plaintiff with which the defendant's conduct interferes; (4) the interests sought to be advanced by the defendant; (5) the social interests in protecting the freedom of action of the defendant and the contractual interests of the plaintiff; (6) the proximity or remoteness of the defendant's conduct to the interference; and (7) the relations between the parties. Restatement (Second) of Torts § 767 (1977).
The difficulty in applying these factors to the present case is that they invite a consideration of that which Reyes has declared off-limits to this court: whether the ACBL's disciplinary action against Blubaugh was justified. The Restatement, however, recognizes that in some cases the law has already weighed the competing factors involved and has embodied its determination in a standard of review or privilege. "When this has been accomplished and the scope of the more or less crystallized rule or privilege has been indicated by the decisions, the responsibility in the particular case is simply to apply it to the facts involved; and there is no need to go through the balancing process afresh." Id., § 767 cmt. j. The holding of Reyes — that absent fraud, other illegality, or invasion of civil or property rights having their origin elsewhere, a court should not interfere with the internal affairs of a voluntary association — represents exactly the kind of "crystallized rule" that the Restatement had in mind. Put another way, because the ACBL's actions do not fall within one of the Reyes exceptions, they are justified under the Restatement view and thus may not support a claim for tortious interference with contract even if the ACBL was wrong as a matter of fact in its evaluation of Blubaugh's shuffling and dealing. Accordingly, the ACBL is entitled to summary judgment on Count III.
The law treats contract rights as property rights in many situations, but because the alleged contract called for Blubaugh to provide services at ACBL tournaments, the implicated property right owed its existence to the ACBL and did not "have its origin elsewhere." See Reyes, 694 N.E.2d at 256. Consequently, Reyes still requires deference to the voluntary association's decisions.
In Count II, Blubaugh advances a claim for "tortious deprivation of livelihood." No tort by that name exists in Indiana, but Blubaugh has indicated in his briefing that the court should construe this claim one for tortious interference with a business relationship, which is recognized by Indiana law. The elements for this cause of action are the same as the elements for tortious interference with contract, except that there is no requirement that a valid contract exist. Flintridge Station Associates v. American Fletcher Mortgage Co., 761 F.2d 434, 440 (7th Cir. 1985) (construing Indiana law). However, there is also one additional element: that the defendant act illegally in interfering with the business relationship. Syndicate Sales, Inc. v. Hampshire Paper Corp., 192 F.3d 633, 641 (7th Cir. 1999); Furno v. Citizens Ins. Co. of America, 590 N.E.2d 1137, 1140 (Ind.App. 1992).
Blubaugh has presented no evidence that the ACBL acted illegally when it suspended him. To the contrary, the record indicates that the ACBL acted within its authority when it convened the Ethical Oversight Committee hearing to enforce its own disciplinary rules. And as noted above, the ACBL's decision to suspend Blubaugh is protected by Indiana law and entitled to substantial deference. Even viewing the evidence in the light most favorable to Blubaugh, he has failed to come forward with evidence needed to sustain his claim for tortious interference with a business relationship. The ACBL is entitled to summary judgment on Count II.
III. Defamation — Counts W, V, and XX
Counts IV and XX state claims against the ACBL for defamation, and Count V alleges a conspiracy to defame. There are four elements to a defamation claim: (1) defamatory imputation; (2) malice; (3) publication; and (4) damages. Schrader v. Eli Lilly Co., 639 N.E.2d 258, 261 (Ind. 1994). Both parties agree that, at least in the context of bridge affairs, Blubaugh is required to show actual malice, which requires a showing that the defendant made the defamatory statement "with knowledge that it was false or with reckless regard to whether it was false or not." Journal-Gazette Co. v. Bandido's, Inc., 712 N.E.2d 446, 452, 456 (Ind. 1999), adopting the standard from New York Times Co. v. Sullivan, 376 U.S. 254, 279-80 (1964). See Def. Br. 34; PL Br. 47.
A. Reports of Beck and Chiszar/ACBL Official Announcement
The first group of defamatory statements were made in connection with the two disciplinary proceedings that the ACBL conducted to adjudicate the charges against Blubaugh. Blubaugh contends that the written expert report prepared by Norman Beck and submitted to the Ethical Oversight Committee contained libelous statements. The report consisted of Beck's detailed observations in watching the videotape recording that was made of Blubaugh's shuffling and card dealing during the 2000 Anaheim national tournament. In the report, Beck reviewed Blubaugh's shuffles and offered his opinion that Blubaugh was cheating during his deals by placing the ace of spades on the bottom of the deck, keeping it there during his shuffles, and dealing it to his playing partner. Blubaugh also contends that the written report prepared by Jim Chiszar, which detailed his observations of Blubaugh placing aces on the bottom of the deck during his shuffles, was libelous. Finally, Blubaugh contends that the public announcement issued by the ACBL regarding his suspension amounted to libel. The announcement in the ACBL bulletin stated:
The ACBL has suspended John Blubaugh from all ACBL bridge play from March 14, 2001 through September 13, 2002 because of card manipulation during the shuffle and deal. Blubaugh, of Indianapolis, IN was found guilty of giving his partner a specific card when he was the dealer. The ACBL Board of Directors sustained the decision of the Ethical Oversight Committee on this matter.
As a matter of law, these statements are protected by a qualified privilege. A qualified privilege exists for "communications made in good faith on any subject matter in which the party making the communication has an interest or in reference to which he has a duty, either public or private, either legal, moral, or social, if made to a person having a corresponding interest or duty." Schrader, 639 N.E.2d at 262. Barring a dispute about the underlying facts giving rise to the privilege, the question of whether a statement is protected by the qualified privilege is a matter of law. Chambers v. American Trans Air, Inc., 577 N.E.2d 612, 616 (Ind.App. 1991).
Statements made in the context of fraternal associations or societies can be protected by the qualified privilege:
It seems to be generally recognized that a qualified privilege attaches to statements and communications made in connection with the various activities of such organizations as lodges, societies, labor unions, etc. Thus, it is well settled that members of such bodies may report on the qualifications of applicants, prefer charges against fellow members, offer testimony in support of the charges, and make proper publication of any disciplinary action that may be taken, without liability for any resultant defamation, so long as they act without malice.Indianapolis Horse Patrol, Inc. v. Ward, 217 N.E.2d 626, 628 (Ind. 1966), quoting 33 Am. Jur. Libel and Slander § 132. The statements made by Beck, Chiszar and the ACBL fall within this privilege. Beck's and Chiszar's statements were contemporaneous records of their observations of events in which the ACBL had an undisputed interest: Blubaugh's shuffling and dealing during the ACBL's Indianapolis and Anaheim tournaments. These statements were made in connection with the ACBL's investigation and the subsequent disciplinary hearing conducted by the Ethical Oversight Committee.
Similarly, the ACBL's public announcement is also protected by the qualified privilege. The ACBL was privileged to "make proper publication of any disciplinary action" taken against a member. Tournament directors and other players, including prospective partners, had a legitimate need for that information.
Statements that fall within the qualified privilege may nonetheless lose their privileged status if the plaintiff can showthat the privilege has been abused. Abuse may be shown by demonstrating either that (1) the speaker was motivated by ill will in making the statement (bad faith); or (2) there was excessive publication of the defamatory statement; or (3) the statement was made without belief or grounds for belief in its truth. Schrader, 639 N.E.2d at 262.
Blubaugh did not specifically address the issue of qualified privilege in his briefs, but he argues that his suspension was motivated by a general feeling of ill will on the part of several key ACBL officers. Blubaugh contends that Michael Aliotta, a rival bridge player with whom Blubaugh has had several disputes, the ACBL's chief tournament director Gary Blaiss, and the ACBL's national recorder Richard Colker all conspired to fabricate the evidence of his cheating at the Indianapolis tournament. Blubaugh theorizes that Aliotta, Blaiss and Colker improperly influenced Chiszar's initial report of suspected cheating. This theory, however, is total speculation, unsupported by evidence that would allow a reasonable jury to accept it.
By all accounts in the evidence, Chiszar observed Blubaugh in Indianapolis on his own accord and did not make contact with Blaiss or Colker until after he believed he saw Blubaugh improperly manipulating the deck. Chiszar Dep. at 88; Blaiss Aff. at ¶¶ 16-17; Colker Dep. at 12-14. Chiszar never had any contact with Aliotta regarding allegations that Blubaugh was cheating. Chiszar Dep. at 88; Aliotta Aff. at ¶¶ 6-7. Further, Blubaugh has presented no evidence that Blaiss or Colker bore him any ill will. Blubaugh may not believe this evidence, but it is the only admissible evidence on the question. A court may not deny summary judgment on the basis of speculation, suspicion, or expectations about what additional evidence might be forthcoming.
With respect to Beck's statement, Blubaugh points to the fact that Beck was an employee of Bob Hamman. Bob Hamman is a top-ranked international bridge player. He is not a member of the ACBL board. There is no evidence that he played any role at all in the 2000 disciplinary process against Blubaugh. He sat on the Ethical Oversight Committee in 1995 when Blubaugh had been charged with forging master point certificates. In that proceeding, Hamman voted with the majority of the committee in finding Blubaugh not guilty. Hamman and Beck never discussed Blubaugh. Beck Dep. at 24. Blubaugh's suggestion that Beck's report was motivated by malice borne by Hamman is pure conjecture.
Blubaugh's theory that the leadership of the ACBL is against him because of his position on issues like the ACBL's relationship with the World Bridge Federation is similarly unsubstantiated. Blubaugh has not come forward with any specific evidence of animus, nor has he attempted to connect this alleged ill will to the statements that he claims were defamatory. Blubaugh has offered no evidence showing that the statements made by Chiszar, Beck and the ACBL were motivated by anything other than a duty to report fairly on a matter that would be of concern to the entire membership of the ACBL. Accordingly, the ACBL is entitled to summary judgment on those portions of Counts IV and V.
B. "Slam Dunk"
Blubaugh also alleges in Count IV that Jeffrey Polisner, general counsel for the ACBL, slandered him by predicting at a meeting of the ACBL board of directors that the case against Blubaugh would be a "slam dunk." The ACBL is also entitled to summary judgment on this portion of Counts IV and V.
First, it is not at all clear that this statement is even capable of being proved true or false. (Even on the basketball court, "slam dunks" are sometimes missed.) If the statement is "too vague to be falsified," it must be characterized as "mere rhetorical hyperbole," which is not actionable. See Dilworth v. Dudley, 75 F.3d 307, 309 (7th Cir. 1996).
Second, assuming it is possible to assess the truth of the statement, the evidence would require a jury to find that it was "substantially true." See Vachet v. Central Newspapers, Inc., 816 F.2d 313, 316 (7th Cir. 1987); Heeb v. Smith, 613 N.E.2d 416, 420 (Ind.App. 1993). Blubaugh was found guilty by a unanimous ten-member panel of the ACBL's Ethical Oversight Committee. This finding was affirmed by a unanimous seven-member panel of the ACBL Appeals and Charges Committee.
In either case, a slander claim based on Polisner's alleged "slam dunk" comment is unsupportable as a matter of law, and the ACBL is entitled to summary judgment on this portion of Counts IV and V.
C. Beck's Comments in "D" Magazine
Blubaugh also alleges in Count IV that he was defamed by comments made by Norman Beck in an interview with "D" Magazine, a Dallas/Fort Worth periodical. The article, which appeared in the February 2001 issue of the magazine, basically recounted Beck's report and testimony before the Ethical Oversight Committee. Two weeks after the article was published, the Appeals and Charges Committee publicly announced Blubaugh's suspension. Although the article omitted Blubaugh's name, the court assumes for purposes of summary judgment that Blubaugh was readily identifiable as the subject of the article. See Lee v. Weston, 402 N.E.2d 23, 30 (Ind.App. 1980).
Beck's statements to the magazine are not entitled to the same qualified privilege as his statements to the Ethical Oversight Committee. Nevertheless, Blubaugh's defamation claim as to the ACBLstill must fail because Blubaugh has not shown how the ACBL can be held responsible for comments made by Beck. Beck was not an employee of the ACBL. At most, Beck was an independent contractor who had been hired to evaluate the Anaheim videotape, to prepare a report detailing his observations of the tape and to testify as to those observations. These duties had ended in November 2000 — before Beck gave the interview.
Moreover, though no case on point exists in Indiana, other courts have held that a principal may not be held liable for the defamatory statements of an independent contractor unless malice can be imputed to the principal itself. See, e.g., Chaiken v. W Publishing Corp., 119 F.3d 1018, 1034 (2d Cir. 1997) (applying New York law); McFarlane v. Esquire Magazine, 74 F.3d 1296, 1303 (D.C. Cir. 1996); Kassel v. Gannett Co., 875 F.2d 935, 941 (1st Cir. 1989) (applying New Hampshire law); Hunt v. Liberty Lobby, 720 F.2d 631, 649 (11th Cir. 1983) (applying Florida law). This line of cases is consistent with Indiana's general rule that a principal may not be held liable for the torts of an independent contractor. Bagley v. Insight Communications Co., 658 N.E.2d 584, 586 (Ind. 1995).
While a worker's classification is often a question for the fact finder, a court may determine the question as a matter of law if there are no underlying factual disputes. See Hale v. Kemp, 579 N.E.2d 63, 66-67 (Ind. 1991). Blubaugh does not contend that the ACBL gave Beck its approval to do the interview, nor is there evidence that the ACBL was even aware of the article until after it was published. Blubaugh does not argue that the ACBL had any control over whether Beck gave the interview. On these facts, the ACBL may not be held liable for the alleged defamatory statements made by Beck in the course of an interview that occurred after his consulting arrangement with the ACBL had ended. Accordingly, the ACBL is entitled to summary judgment on this portion of Counts IV and V.
D. Fresh Slanders
Count XX alleges "fresh slanders" by Chris Compton, Jeffrey Polisner and unidentified "others" regarding alleged false publications about the evidence in this very lawsuit. Blubaugh believes that the slanderous publications falsely indicated that he had been provided discovery before the hearing of the Ethical Oversight Committee. Blubaugh alleges that the defamatory statements were made after he filed the present lawsuit.
A statement is defamatory only if it "tends so to harm the reputation of another as to lower him in the estimation of the community or to deter third persons from associating or dealing with him." Journal-Gazette v. Bandido's, 712 N.E.2d at 451, quoting Doe v. Methodist Hosp., 690 N.E.2d 681, 686 (Ind. 1997). A statement to the effect that Blubaugh received pre-hearing discovery is not defamatory standing on its own. Nor is it defamatory even if viewed in the context of a finding of guilt by the Ethical Oversight Committee. In this case, Blubaugh's reputation was harmed by the finding that he had cheated, and not by any claim that he was provided with discovery.
Also, Blubaugh has again failed to demonstrate how the alleged statements of Compton and Polisner can be imputed to the ACBL. Compton has no affiliation with the ACBL. Polisner formerly served as league counsel but no longer held that position (or any position with the ACBL) when the alleged statements were made. Blubaugh Dep. at 733.
For the foregoing reasons, the court grants the ACBL's motion for summary judgment as to Counts IV and XX, alleging defamation and fresh slanders. Additionally, in that a reasonable jury could not find that the ACBL participated in defaming Blubaugh, summary judgment is also appropriate on Count V, which alleges a conspiracy to defame.
IV. Federal RICO
The ACBL is also entitled to summary judgment on Blubaugh's RICO claim, which is plainly frivolous. Count XVII alleges that a number of unidentified "control" defendants operated the ACBL as a RICO enterprise to facilitate unspecified self-dealing transactions. These transactions, Blubaugh contends, were made possible by the ACBL's continued funding of the World Bridge Federation, which in turn paid out lavish expense reimbursements to ACBL directors and officers.
The civil RICO remedy enacted in 18 U.S.C. § 1964(c) provides: "Any person injured in his business or property by reason of a violation of section 1962 of this chapter may sue therefor. . . ." At the most basic level, Blubaugh has not identified any violation of 18 U.S.C. § 1962 that injured him in his business or property. Instead, his brief on the RICO claim argues that ACBL board members were improperly using ACBL assets to pay for travel to meetings of the World Bridge Federation. Civil litigants have tried to apply RICO in many unexpected settings, but Blubaugh's theory takes the prize. The wrongs alleged here (a) fall far short of any indictable offense within the statutory definition of "racketeering activity"; and (b) have nothing to do with any alleged injury to Blubaugh's business or property (unless he is seeking to recover some miniscule fraction of his ACBL dues over the years). Blubaugh has not even tried to argue that these activities amount to racketeering activity under RICO.
In his brief in opposition to summary judgment, Blubaugh theorizes that the ACBL was engaged in mail fraud as prohibited by 18 U.S.C. § 1341. This claim is also devoid of factual support. Blubaugh is unable to point to any specific mailings that were fraudulent, nor does he present any evidence of a scheme to defraud as required by the statute. See United States v. Walker, 9 F.3d 1245, 1249 (7th Cir. 1993). "A necessary element of a scheme to defraud is the making of a false statement or material misrepresentation, or the concealment of a material fact." Aztar, 351 F.3d at 298, citing Neder v. United States, 527 U.S. 1, 25 (1999). Evidence of a fraudulent scheme is completely absent from the record, and in any event these alleged wrongs have nothing to do with Blubaugh's suspension, which the court had thought was the focus of this case.
In one of the most unusual dimensions of this unusual case, Blubaugh asserts at page 53 of his brief that he has evidence of predicate acts of racketeering in the form of murder threats by Michael Aliotta. When one looks for supporting evidence, Blubaugh cited the deposition testimony of Colker and Exhibit 45. See PL Br. at 5 (second paragraph). Exhibit 45 is Aliotta's account of an angry encounter, but it certainly does not amount to an admission by Aliotta that he made any such threat. Blubaugh did not cite his own deposition testimony, but there are some references in his deposition testimony to threats by Aliotta. See Blubaugh Dep. at 205, 211-13. This evidence could not support a civil RICO claim against the ACBL. There is no evidence that Aliotta was acting on behalf of the ACBL. The only evidence on that point is that the ACBL condemned the threat and told both Aliotta and Blubaugh to behave. There certainly is no evidence of any link between the alleged threats and Blubaugh's suspension or any harm to his business or property, as required by 18 U.S.C. § 1964(c). The ACBL is entitled to summary judgment on Count XVII.
V. Sherman Act
With respect to his antitrust claim in Count VIII under the federal Sherman Act, Blubaugh advances an only slightly modified version of the theory that the court rejected in denying his motion for a preliminary injunction. Relying on Blalock v. Ladies Professional Gold Ass'n, 359 F. Supp. 1260, 1265-66 (N.D. Ga. 1973), Blubaugh continues to see this case as a "group boycott" case subject to per se illegality under Section 1 of the Sherman Act, 15 U.S.C. § 1.
Since Blalock was decided, the Supreme Court and the circuits have analyzed such cases involving restrictions in sports and other competitive leagues under the rule of reason. When the trade allegedly being restrained concerns a competitive sport, the Court has recognized, the per se rule creates problems because the competition would be impossible without collective agreements among competitors about the rules of the competition and enforcement of those rules. See NCAA v. Board of Regents of University of Oklahoma, 468 U.S. 85, 101 (1984) (applying rule of reason to horizontal agreement limiting television broadcasts of college football games; critical fact was that case involved "an industry in which horizontal restraints on competition are essential if the product is to be available at all"); United States Trotting Ass'n v. Chicago Downs Ass'n, 665 F.2d 781, 788-89 (7th Cir. 1981) ( en banc) (horse racing association's ban on members competing at non-sanctioned tracks was not per se illegal and was tested under rule of reason); Bridge Corp. of America v. American Contract Bridge League, 428 F.2d 1365, 1369 (9th Cir. 1970) (applying rule of reason to Sherman Act claim against ACBL based on refusal to sanction a tournament using new scoring computer); Brant v. United States Polo Ass'n, 631 F. Supp. 71, 75 (S.D. Fla. 1986) (denying injunction to block suspension of polo player for abusing umpire; restraint must be tested under rule of reason, and per se analysis from Blalock was no longer applicable).
The continued viability of the per se rule stated in Blalock, if any, is therefore limited. The Seventh Circuit has made clear that the per se rule "should not be applied, and has never been applied by the Supreme Court, to concerted refusals that are not designed to drive out competitors but to achieve some other goal." Chicago Downs, 665 F.2d at 787, quoting Smith v. Pro Football, Inc., 593 F.2d 1173, 1180 (D.C. Cir. 1978). The availability of procedural safeguards also weighs against a "group boycott" finding. See Livezey v. American Contract Bridge League, 1985 WL 2648, *8 (E.D. Pa. 1985). Cf. McCreery Angus Farms v. American Angus Ass'n, 379 F. Supp. 1008 (S.D. Ill. 1974), aff'd, 506 F.2d 1404 (7th Cir. 1974) (association's actions constituted a group boycott because it had a complete monopoly and it failed to afford members even minimal procedural safeguards); Blalock, 359 F. Supp. at 1260 ( per se rule applied because plaintiff had been suspended by her competitors, who acted with unfettered, subjective discretion and failed to provide her with a hearing).
Blubaugh is hard pressed to characterize the ACBL's action in suspending him as an attempt to eliminate competitors. Abandoning his previous theory, he has conceded that the members of the Ethical Oversight Committee were not his competitors within the meaning of the Sherman Act. His new theory is that Michael Aliotta-who was the co-chairman of the committee but did not sit on the panel that heard Blubaugh's case — was a competitor of Blubaugh's and used his authority to exclude Blubaugh from ACBL tournaments.
Blubaugh, however, offers only speculation to support his claim. As discussed above, no evidence exists that Aliotta instructed Chiszar to observe Blubaugh at the Indianapolis tournament or influenced Chiszar's report of his observations. Blubaugh merely has "suspicions" that this occurred. Blubaugh Dep. at 280. There is no evidence that any of the directors who observed Blubaugh shuffling and dealing or any of the ACBL officials who were involved in the subsequent investigation and disciplinary proceedings had any contact with Aliotta regarding the matter. Blubaugh has presented no evidence that Aliotta exercised any control or influence over the determinations of the Ethical Oversight Committee or the Appeals and Charges Committee.
Blubaugh also characterizes the ACBL's rules and procedures as a sham. He argues that the "flawed" rules were applied arbitrarily, effectively denying him a meaningful hearing, such that the court should apply the per se rule in Blalock. As the court noted above, the evidence shows no material violation of the ACBL's rules. Pre-hearing discovery is not required under its rules, even if those rules were enforceable in court. Blubaugh had a full hearing, he had counsel, and he had the opportunity to challenge committee members for cause. He has not cited any post-Blalock case in which a court applied the per se standard to a competitor's antitrust theory for exclusion from a sport or similar activity after procedures as extensive as those provided in this case. See Livezey v. American Contract Bridge League, 1985 WL 2648, 1985-2 Trade Cases ¶ 66,875 (E.D. Pa. Sept. 12, 1985) (granting summary judgment under rule of reason on antitrust claim challenging ACBL's suspension of player after hearing), aff'd mem., 800 F.2d 1135 (3rd Cir. 1986); Cokin v. American Contract Bridge League, Inc., 1981 WL 2223, 1983-1 Trade Cases ¶ 65,367 (S.D. Fla. Nov. 30, 1981) (refusing to apply per se standard to ACBL's suspension of bridge players for cheating, but denying summary judgment under rule of reason). Even if the court indulged the assumption that a few committee members whom Blubaugh chose not to challenge were nevertheless biased against him, the committee ruled against him unanimously. In short, even if Blalock were still good law, Blubaugh has not come forward with evidence that might support its per se standard.
The rule of reason under the Sherman Act focuses on the impact the restraint of trade has on competition, NCAA v. Board of Regents of University of Oklahoma, 468 U.S. at 104, which is gauged primarily in terms of the effect on price and supply, id. at 107. Blubaugh concedes that he is unable to present the market effects data needed to support a Sherman Act claim under the rule of reason. Nevertheless, he claims that the "quick look" approach of the University of Oklahoma case obviates the need to do so.
In University of Oklahoma, the Supreme Court held that a "naked restraint on price and output requires some competitive justification even in the absence of a detailed market analysis." 468 U.S. at 110. The pro-competitive justifications for the ACBL's actions with respect to Blubaugh are obvious. Facially neutral rules that prohibit cheating are essential to promote fair competition and to preserve the integrity of the game. Even a quick look reveals that Blubaugh has been unable to raise a material issue of fact as to whether his suspension violated section 1 of the Sherman Act. The ACBL is entitled to summary judgment on Count VIII.
VI. Negligence in Failing to Recover Anaheim Videotape — Count VI
Blubaugh charges in Count VI that the ACBL was "grossly negligent" in failing to recover the Anaheim surveillance videotape from Norman Beck. Blubaugh alleges that he was harmed as a result of this negligence when Beck showed the videotape to the author of the "D" Magazine article. The ACBL is entitled to summary judgment on this claim.
The ACBL contends, and Blubaugh has not disputed, that Texas law should apply to this tort claim. The existence of a duty owed by the defendant to conform its conduct to a standard of care is a question of law for the court to determine based on the circumstances of the particular case. Ford v. Cimarron Ins. Co., 230 F.3d 828, 830 (5th Cir. 2002).
Blubaugh's negligence claim fails as a matter of law because he is unable to establish that the ACBL owed him any duty with regard to the videotape. He has cited to no case where a Texas court or any other court found a duty to exist in similar circumstances. The videotape is neither confidential nor privileged. The ACBL acted lawfully when it observed and recorded Blubaugh's public conduct at the Anaheim tournament. To the extent Blubaugh is alleging "gross negligence" under Texas law, he would still need to show a duty, and he would also need to show that the ACBL was actually aware of an "extreme risk" that he would be harmed by its failure to demand that Beck leave the videotape with the ACBL. See Streber v. Hunter, 221 F.3d 701, 732 (5th Cir. 2000) (applying Texas law). Blubaugh's evidence would not support such a finding in this case. Finally, Blubaugh also has no evidence indicating that he suffered any harm as a result of Beck's possession of the videotape (as distinct from Blubaugh's suspension and the publicity that event received). The ACBL is entitled to summary judgment on Count VI.
VII. Abuse of Process — Count XVIII
Count XVIII attempts to allege a claim for abuse of process. The process allegedly abused, according to Blubaugh, is the ACBL's internal disciplinary process that culminated in his suspension. Indiana law, however, does not recognize the internal proceedings of a voluntary association as a "process" upon which a plaintiff may base an abuse of process claim. In Reichhart v. City of New Haven, 674 N.E.2d 27, 31-32 (Ind.App. 1997), the Indiana Court of Appeals adopted a relatively expansive view of the abuse of process tort, but even that view does not reach the internal procedures of a private association like the ACBL.
The Court of Appeals wrote:
"Process" should not be "limited to the strict sense of the term, but [should be] broadly interpreted to encompass the entire range of `procedures' incident to litigation. . . . This broad reach of the `abuse of process' tort can be explained historically, since the tort evolved as a `catch-all' category to cover improper uses of the judicial machinery. . . .674 N.E.2d at 31, quoting Groen v. Elkins, 551 N.E.2d 876, 878 n. 3 (Ind.App. 1990), quoting in turn Barquis v. Merchants Collection Ass'n of Oakland, Inc., 496 P.2d 817, 823 n. 4 (Cal. 1972) ( en banc). "Process" therefore implies the "use of judicial machinery" and "includes actions undertaken by a litigant in pursuing a legal claim". Reichhart, 674 N.E.2d at 31-32. Alternatively, the court framed the relevant question as whether the "use of process 'was a legitimate use of the judicial system.'" Id., quoting Broadhurst v. Moenning, 633 N.E.2d 326, 333 (Ind.App. 1994).
The ACBL procedures about which Blubaugh complains do not meet the criteria even under Reichharts expansive definition of "process." The ACBL's internal workings cannot fairly be characterized as "judicial machinery." No "legal claim" was implicated or jeopardized by the ACBL's disciplinary proceedings. The "judicial system" was not employed directly or indirectly in suspending Blubaugh from the ACBL. Moreover, recognizing this claim for abuse of process would undermine the Indiana Supreme Court's decision in Reyes, for it would simply open up a back door allowing judicial review of the private voluntary association's internal decisions.
Blubaugh suggests that the disciplinary process is necessarily "incident to litigation" because the ACBL rules require the member to exhaust administrative remedies before a member may litigate in court. The language of the Reichhart passage indicates, however, that the "incident to litigation" phrase is impliedly limited by the "use of the judicial machinery" sentence that follows it. The examples that follow the quoted passage confirm this interpretation. The Reichhart language originated from a California Supreme Court opinion that cited taking a deposition, filing an action, and taking an appeal as actionable "processes" that are "incident to litigation." Barquis, 496 P.2d at 823 n. 4.
Blubaugh has not identified a single case, from Indiana or otherwise, where a court treated the proceedings of a voluntary association as a "process" for the purposes of an abuse of process tort claim. The ACBL has cited several cases holding that administrative proceedings are not actionable "processes" under the common law tort. See, e.g., Stagemeyer v. County of Dawson, 192 F. Supp.2d 998, 1010 (D. Neb. 2002) ("The `process' in an abuse-of-process claim means judicial, as opposed to administrative, process because the purpose of the tort is to preserve the integrity of the court and the judicial process."); O'Hayre v. Board of Educ. for Jefferson County School Dist., 109 F. Supp.2d 1284, 1296-97 (D. Colo. 2000) (suspension of student implemented by school administrators was not actionable "process" because it did not involve "any contact with a judicial forum"; abuse of process claim "by its terms requires judicial proceedings."); Char v. Matson Terminals, Inc., 817 F. Supp. 850, 858-59 (D. Haw. 1992) (appeal to state unemployment agency was not "process" within meaning of abuse of process tort; "in an abuse of process claim, it is clear that the judicial process must in some manner be involved") (emphasis in original) (internal quotations omitted).
The only case cited by Blubaugh on this issue, International Medical Group, Inc. v. American Arbitration Ass'n, 149 F. Supp.2d 615, 632 (S.D. Ind. 2001), aff'd, 312 F.3d 833 (7th Cir. 2002), does not support his argument. In that case, Judge Barker held that the American Arbitration Association's simple "docketing" of a case in preparation for arbitration did not rise to the level of a "process" that was capable of being abused. The secondary question and the one relevant to this case — whether the association's actions amounted to a judicial process within the meaning of the tort — was left unanswered.
In summary, because the ACBL's disciplinary proceedings did not employ the "use of the judicial machinery" or implicate a "legal right," they did not constitute an actionable "process" for the purposes of an abuse of process tort claim. The ACBL is entitled to summary judgment on Count XVIII.
Conclusion
For the foregoing reasons, defendant ACBL's motion for summary judgment is granted with respect to all counts. Plaintiff John Blubaugh's motion for partial summary judgment is denied. Final judgment will be entered accordingly.
So ordered.