Opinion
CIVIL ACTION No. 99-3462 SECTION "K" (3).
October 4, 2000.
Before the Court is defendant Bassett Furniture Industries, Inc.'s Rule 12(b)(6) Motion for Partial DismissL (doc. #21) and defendant Hilton Wimbs' Rule 12(b)(6) Motion for Partial Dismissal (doc. #23). Having reviewed the pleadings, memoranda and the relevant law, the Court finds as follows,
David J. Henson ("Henson") filed a petition for damages in the 22nd Judicial District Court for the Parish of St. Tammany against Bassett Furniture Industries, Inc. ("Bassett"), Hilton Wimbs ("Wimbs"), John Doe, Robert Roe, ABC Insurance Co. and XYZ Insurance Company. Plaintiff alleged intentional interference with contractual relations, intentional infliction of emotional distress, negligent infliction of emotional distress and defamation. The case was timely removed to federal court. Bassett filed, and Wimbs adopted, a 12(b)(6) motion seeking dismissal of plaintiffs intentional interference with contractual relations, intentional infliction of emotional distress and negligent infliction of emotional distress claims in their entirety. The Court granted the motion with respect to the negligent infliction of emotional distress claim and allowed plaintiff30 days to amend its petition to state a cause of action for intentional interference with contractual relations and intentional infliction of emotional distress. Before the Court are Bassett's and Wimbs' motions to dismiss those causes of action based on the Amended Complaint's failure to state a claim upon which relief can be granted.
Allegedly, Henson was the exclusive manufacturer's representative of Bassett Furniture in Louisiana and had been quite successful through 1998. Plaintiff claims that in October of 1998, Bassett advised that it was reducing commissions for its sales representatives from 5% to 4%. Wimbs was allegedly an exclusive manufacturer's representative of Bassett Furniture for varying years within the States of Tennessee, Mississippi, Arkansas, and Oklahoma. Henson alleges that Wimbs demanded additional compensation under the threat of terminating his long-term representation of Bassett in light of the reduction. In response, Henson contends that Rob Spillinan, president of Bassett Furniture, and Wimbs agreed to give Wimbs the Louisiana territory previously handled by plaintiff. Allegedly, plaintiff was under a year to year oral contract, based upon performance (Amended Complaint ¶ X-XI). Although both the president and vice president (Tom Prato) of Bassett were aware of plaintiff's alleged oral contract with the company, Tom Prato informed plaintiff that Spillman decided to terminate him in lieu of losing or displeasing Wimbs.(Amended Complaint ¶ XVII-XX) The decision was not based on plaintiffs performance but solely to appease Wimbs. (Amended Complaint ¶ XVII) Plaintiff further alleges that "John Doe" contacted a vendor and defamed plaintiff, causing him damages. As such, Henson contends that the defendants injured plaintiff by unlawfully interfering in plaintiffs contractual relationship with Bassett Furniture and further caused intentional infliction of emotional distress upon plaintiff through extreme and outrageous conduct.
A motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) is viewed with disfavor and is rarely granted. Beanal v. Freeport McMoran. Inc., 197 F.3d 161, 164 (5th Cir. 1999). The district court is required to liberally construe the complaint in favor of the plaintiff, and all facts pleaded in the complaint must be taken as true. Id. As the Fifth Circuit stated:
The district court may not dismiss a complaint under rule 12(b)(6) "unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Conley v. Gibson, 355 U.S. 41, 45-46, 78 5. Ct. 99, 101-02,2 L.Ed.2d 80 (1957); Blackburn, 42 F.3d 929, 931 (5th Cir. 1995). This strict staindard of review under rule 12(b)(6) has been summarized as follow: "The question therefore is whether in the light most favorable to the plaintiff and with every doubt resolved in his behalf, the complaint states any valid claim for relief." Charles A. Wright Arthur R. Miller, Federal Practice and Procedure' 1357 at 601 (1969).Beanal, 197 F.3d at 164.
"In order to avoid dismissal for failure to state a claim. . . a plaintiff must plead specific facts, not mere conclusory allegations. [The Court need] not accept as true conclusory allegations or unwarranted deductions of fact." Collins v. Morgan Stanley Dean Witter, 2000 WL 1159321, *2 (5th Cir. 2900) (citingTuchman v. DSC Communications Corp., 14 F.3d 1061, 1067 (5th Cir. 1994) (internal citations, quotation marks and ellipses omitted)). Additionally, in deciding whether plaintiff's complaint satisfactorily states a cause of action, "[a] court [is not bound to] accept conclusory allegations concerning the legal effect of the events plaintiff has set out if these allegations do not reasonably follow from his description of what happened, or if these allegations are contradicted by the description itself." Charles A.Wright Arthur R. Miller, Federal Practice Procedure, § 1357, pp. 319-20 (1990).
A review of the causes of action sought to be dismissed is required. The intentional interference with contractual relations claim was recognized in a limited fashion by the Supreme Court in9 to 5 Fashions. Inc. v. Spurney, 538 So.2d 228 (La. 1989) and to date the holding has been "restricted to the precise cause of action it explicates: that is a situation involving a corporation, an officer of the corporation, and a contract between the corporation and a third party." Egorov. Pughinskv. Afanasiev Juring v. Terribeny. Carroll Yancev, 1998 WL 483483, *3 (E.D.La. Aug. 14, 1998), citing Great Southwest Fire Ins. Co. v. CNA Ins. Cos., 557 So.2d 966 (La. 1990); Kite v. Gus Kaplan. Inc., 708 So.2d 473 (La.App. 3d Cir. 1998); Colbert v. B.F.Carvin Const. Co., 600 So.2d 719 (La.App. 5th Cir. 1992);Durand v. McGaw, 635 So.2d 409 (La.App. 4th Cir. 1994). To recover under this cause of action, a plaintiff must allege and prove:
(1) the existence of a contract or a legally protected interest between the plaintiff and the corporation;
(2) the corporate officer"s knowledge of the contract;
(3) the officer"s intentional inducement or causation of the corporation to breach the contract or his intentional rendition of its performance impossible or more burdensome;
(4) absence of justification on the part of the officer;
(5) causation of damages to the plaintiff by the breach of contract or difficulty of its performance brought about by the officer.Spurney, 538 So.2d at 234.
The Court previously found that plaintiffs allegation in his original petition failed to plead (1) a corporate officer's involvement, (2) knowledge on the part of the corporate officer of plaintiffs contract and the corporate officer"s intentional inducement of the breach, or (3) the corporate officer lacked justification for so doing.
Plaintiffs Amended Complaint sufficiently remedies the first two deficiencies outlined in the Court's earlier minute entry. However, by its own terms, the complaint fails to allege that the corporate officers lacked justification for acting as they did. Indeed, in § XVII of the Amended ¶ Complaint, plaintiff alleges that "the negotiations [which eventually resulted in plaintiffs termination] with Wimbs were not based upon plaintiffs performance but solely on Bassett Furniture trying to appease Wimbs in light of his potential commission loss in the new program. Likewise, in ¶ plaintiff states that "he was being dismissed without cause based on Rob Spillman"s intentions to terminate plaintiff in lieu of losing or displeasing Wimbs." Finally, at ¶ XXI is the allegation that "[Plaintiffs] contract with Bassett Furniture was based upon his performance and therefore, there was no justification for his dismissal." Although plaintiff does employ the term "no justification", an examination of the "justification" element reveals that complaint looks to the wrong body of law to interpret justification.
Under Louisiana's law of intentional interference with contract, a corporate officer may be subject to liability "unless the officer has reasonable justification for his conduct. The officer's action is justified, and he is entitled to a privilege of immunity, if he acted within the scope of his corporate authority and in the reasonable belief that his action was for the benefit of the corporation." 9 to 5 Fashions. Inc. v. Spurnev, 538 So.2d 228, 231 (La. 1989); Thornton v. Lanehart, 723 So.2d 1127, ll31-1132 (La.App. 2 Cir. 1998);see also Yarbrough v. Federal Land Bank Assoc. of Jackson, 616 So.2d 1327, 1333-34 (La.App. 2 Cir. 1993) (plaintiff must allege lack of justification to have actionable claim); Green v. Beauregard Federal Savings Bank, 640 So.2d 1351, (La.App. 3 Cir. 1992) (no cause of action when officials acting to protect corporation's interests). Moreover,
[A]n officer is privileged to induce the corporation to violate a contractual relation, or make its performance more burdensome, provided that the officer does not exceed the scope of his authority or knowingly commit acts that are adverse to the corporation.9 to 5 Fashions. Jnc. v. Spurnev, 538 So.2d 228, 231 (La. 1989) (emphasis added).
Plaintiff alleges that the president and vice president of Bassett Furniture fired him in order to have the ability to retain Wimbs, another salesperson. However, under 9 to 5, the corporate officers are entitled to a privilege of qualified immunity unless they "exceeded the scope of their authority" or "knowingly committed acts that are adverse to the corporation." Plaintiff does not allege that the corporate officer exceeded the scope of his authority or committed an act that was adverse to the corporation. Plaintiff does allege that the corporation made a decision to terminate his employment, "in lieu of" losing or displeasing Wimbs. Such an allegation indicates that the corporate officers made a decision based upon an assessment of plaintiffs and Wimbs' respective values to the corporation. Thus, plaintiffs amended complaint fails to demonstrate that the action was unjustified under the Louisiana law of intentional interference with contractual relations.
Plaintiffs allegations that he was a superior performer for Bassett, and that he could only be terminated for poor performance, are misguided. The terms of plaintiffs contract may be pertinent to an action for breach of contract, but not to the delictual cause of action asserted in this case. Indeed, 9 to 5 expressly recognizes that a corporate officer may violate a contractual relation. 9 to 5 fashions. Inc. v. Spurney, 538 So.2d 228, 231 (La. 1989). Although a contract is necessary to have standing for the tort, the breach of the contract, ex proprio vigore, does not trigger the tort. In the Court's review of this Rule 12(b)(6) dismissal, it has accepted the allegations in the complaint as true and has viewed them in the light most favorable to Mr. Henson. Louisiana does not recognize a cause of action for intentional interference with contractual relations based on the recited facts.
As concern's plaintiffs intentional infliction of emotional distress claim, the seminal case outlining this cause of action is White v. Monsanto Co., 585 So.2d 1205 (La. 1991). The Louisiana Supreme Court held that in order to recover for intentional infliction of emotional distress, a plaintiff must establish "(1) that the conduct of the defendant was extreme and outrageous; (2) that the emotional distress suffered by the plaintiff was severe; and (3) that the defendant desired to inflict severe emotional distress or knew that severe emotional distress would be certain or substantially certain to result form his or her conduct." Id. at 1209.
The supreme court then described the conduct necessary to prevail as follows:
The conduct must be so outrageous in character, and so extreme in degree, as to go beyond all possible bounds of decency, and to be regarded as atrocious and utterly intolerable in a civilized community. Liability does not extend to mere insults, ipdignities, threats, annoyances, petty oppressions, or other trivialities. Persons must necessarily be expected to be hardened to a certain amount of rough language, and to occasional acts that are definitely inconsiderate and unkind. Not every verbal encounter may be converted into a tort: on the contrary, "some safety valve must be left through which irascible tempers may blow off relatively harmles steam." Restatement, supra, comment d, § 46; Prosser and Keaton, The Law of Torts, § 12, p. 59 (5th ed. 1984).White at 1209.
Recently, in Nicholas v. Allstate Insurance Company, 2000 WL 1234227 (La. 8/31/00), the Louisiana supreme court reiteratedWhite's tripartite test and discussed the application of the cause of action since White. In discussing the "high threshold for intentional infliction of emotional distress established inWhite," the court once again acknowledged that the contours of the tort under article 2315 are "illuminated" by the Restatement (Second) of Torts. Id. at **2. Citing Comment D of Restatement § 46, the court stated that
It has not been enough that the defendant has acted with an intent which is tortious or even criminal, or that he has intended to inflict emotional distress, or even that this conduct has been characterized by "malice" or a degree of aggravation which would entitle plaintiff to punitive damages for another tort. Liability has been found only where the conduct has been so outrageous in character, and so extreme in degree, as to go beyond all possible bounds of decency, and to be regarded as atrocious, and utterly intolerable in a civilized community.Nicholas at **3
Factors (2) and (3) of the White test involve a fact-driven subjective inquiry into the states of mind of the actors and are difficult to resolve on a motion to dismiss. Factor (1), however, can be considered on a more objective basis. If resolving all questions of fact in favor of Henson, the conduct complained of is not sufficiently "extreme and outrageous", then dismissal on the issue of intentional infliction of emotional distress is appropriate. See generally Greenwell v. Raytheon Aerospace, 1996 WL 63093, *3 (ED. La. 1996). Plaintiff was given the opportunity to amend his petition to plead the elements of White v. Monsato. However, in the Complaint as amended, it is patent that plaintiff has failed to allege that Bassett and Wimbs' conduct was extreme and outrageous, thereby failing to satisfy the first element of recovery under White and its progeny. Once again, plaintiffs Amended Complaint uses the appropriate nomenclature, but is factually deficient. Plaintiff states that "Bassett's conduct was extreme and outrageous," (Amended Complaint ¶ XXXVI) and also alleges that two Bassett employees, John Doe and Robert Roe, contacted vendors and represented that plaintiffs dismissal was based on performance (Amended Complaint § XXIV, XXVIII) which constituted "defamation in that it was untrue and made with malice and knowledge of its falsity." (Amended Complaint ¶ XXV). Paragraph's XXXVI AND XXXVII state that Bassett's and Wimbs' conduct was extreme and outrageous in that plaintiff was terminated despite his tireless efforts on behalf of Bassett.
Paragraph XXXVI is a "legal conclusion masquerading as a factual conclusion [and] will not suffice to prevent a motion to dismiss", even under the liberal standards of Rule 8. Jefferson v. Lead Industries Assoc., 106 F.3d 1245, 1250 (5th Cir. 1997); Charles A. Wright Arthur R. Miller, Federal Practice Procedure' 1357, pp. 311-318 (1990). The remaining factual allegations do not plead the extreme and outrageous conduct necessary to satisfy Nicholas and White. Plaintiff has plead that the defendants acts were tortious (defamatory) and malicious. However, "[c]onduct which is merely tortious or illegal does not rise to the level of being extreme and outrageous." Nicholas v. Allstate Insurance Company, 2000 WL 1234227 at **6 (La. 8/31/00).See also Skidmore v. Precision Printing Pkg., Inc., 188 F.3d 606, 613 (5th Cir. 1999) (mere violation of laws regulating conduct in the workplace is not enough to establish intentional inflict on). Plaintiffs allegations of defamation and unfair termination fail to show conduct on the part of the defendants that is "so extreme and outrageous in degree as to be regarded as "atrocious and utterly intolerable in a civilized community."Barfott v. Zapata Corportion, 1995 WL 425026 at *4 (E.D. La. 1995) (quoting Massey v. G.B. Cooley Hospital, 593 So.2d 460, 464 (La.App. 2 Cir. 1992)).
In Beanal, the Fifth Circuit noted that under Fed.R.Civ.P.8(a), a short and plain statement of the claim showing that a plaintiff is entitled to relief is required. A complaint is inadequate only if it fails to (1) provide notice of circumstances which give rise to the claim, or (2) set forth sufficient information to outline the elements of the claim or permit inferences to be drawn that these elements exist. Beanal, 197 F.3d at 164.
Bearing those criteria in find, the Court finds that it must dismiss plaintiffs claims for intentional interference with contractual relations and intentional infliction of emotional distress. Accordingly,
IT IS ORDERED that Bassett Furniture's and Hilton Wimbs' Motions to Dismiss plaintiffs intentional interference with contractual relations and intentional infliction of emotional distress claim are GRANTED.