“Enemies List” - Not a good idea in Virginia unless you want to be sued

“Enemies List” - Not a good idea in Virginia unless you want to be sued

On November 6, 2020, Alexandria Orcasio-Cortez tweeted: “Is anyone archiving these Trump sycophants for when they try to downplay or deny their complicity in the future? I foresee decent probability of many deleted Tweets, writings, photos in the future.”

In response, Hari Sevugan, former Democratic National Committee press secretary and ex-deputy campaign manager for Pete Buttigieg, tweeted: “. . .WH staff are starting to look for jobs. Employers considering them should know there are consequences for hiring anyone who helped Trump attack American values. Find out how at the Trump Accountability Project.”

As of the date of this article, the website provided by Mr. Sevugan (https://www.trumpaccountability.net/) is no longer active.

The “Trump Accountability Project” was reportedly formed in part to ensure that members of the current administration “are not rewarded with book deals, TV contracts, or six-figure salaries in the private sector” (formerly at trumpaccountability.net). The project was described as “looking to blacklist those that worked for the outgoing administration” https://www.firstpost.com/world/trump-accountability-project-meet-new-group-seeking-to-blacklist-staff-who-worked-for-trump-administration-9007641.html. (emphasis added).

Reading about the Trump Accountability Project got us thinking about the potential legality of such an “enemies” list in Virginia, written or otherwise.

In short, there are a number of potential legal avenues under Virginia law for potential plaintiffs who lose a contract or business expectancy (e.g. a job) as a result of intentional interference by a third party.

While any resulting claim by an injured plaintiff is necessarily fact dependent, the applicable law in Virginia is generally outlined below:

I. Tortious Interference with Contract or Business Expectancy

Virginia recognizes a private cause of action for tortious interference with contract or business expectancy. A plaintiff can bring a claim in Virginia for tortious interference when a third party has interfered with an existing contract or the plaintiff’s legitimate expectation of a prospective business relationship with another party.

  • What Are the Elements

The elements of a prima facie case of tortious interference with contract or business expectancy in Virginia are:

  1. The existence of a valid contractual relationship or business expectancy;
  2. Knowledge of the relationship or expectancy on the part of the defendant;
  3. Intentional interference inducing or causing a breach or termination of the relationship or expectancy; and
  4. Resultant damage to the plaintiff, whose contractual relationship or business expectancy has been disrupted.

See Schaecher v. Bouffault, 772 S.E.2d 589, 602 (Va. 2015) (citing Chaves v. Johnson, 335 S.E.2d 97, 102 (Va. 1985)); Maximus, Inc. v. Lockheed Info. Mgmt. Sys., 493 S.E.2d 375, 378 (Va. 1997).

  • The Mere Possibility of a Future Benefit is Not Enough

Under Virginia law, the mere possibility of a future business relationship is not enough to demonstrate a “business relationship or expectancy, with a probability of future economic benefit to plaintiff,” as is required to make out a claim of tortious interference under Virginia law. Heflin v. Coleman Music & Entm’t, L.L.C., 2011 U.S. Dist. LEXIS 141579, at *28 (E.D. Va. Dec. 5, 2011). Instead, a plaintiff must demonstrate that a future economic benefit is objectively probable. CSX Transp., Inc. v. Norfolk S. Ry. Co., 2019 U.S. Dist. LEXIS 161339, at *48 (E.D. Va. 2019). Subjective expectancies are insufficient.

In other words, mere proof of the plaintiff’s belief and hope that a future business relationship would ensue is inadequate to sustain the cause of action. X-It Prods., L.L.C. v. Walter Kidde Portable Equip., Inc., 155 F. Supp. 2d 577, 582 (E.D. Va. 2001). See Peterbilt of Bristol, Inc. v. Mac Trailers, Mfg., 2009 U.S. Dist. LEXIS 109179, at *1 (W.D. Va. 2009) (truck dealer failed to state a valid claim for tortious interference with a business expectancy where it alleged that an out-of-state dealer illegally sold a truck to one of plaintiff’s existing customers, but failed to allege that the economic benefit was objectively probable by demonstrating that but for the interference, the customer would have purchased the truck from the plaintiff).

  • Improper Methods Required for At Will Contracts

Significantly, when the contract or business expectancy is terminable at will, a plaintiff, in order to present a prima facie case of tortious interference, must also allege and prove that the defendant employed “‘improper methods.” Duggin v. Adams, 234 Va. 221, 226-27, 360 S.E.2d 832, 836 (1987) (citation omitted). “Improper methods” under Virginia law “include a wide variety of conduct,” including:

Methods of interference considered improper are those means that are illegal or independently tortious, such as violations of statutes, regulations, or recognized common-law rules . . . . Improper methods may include violence, threats or intimidation, bribery, unfounded litigation, fraud misrepresentation or deceit, defamation, duress, undue influence, misuse of inside or confidential information, or breach of a fiduciary relationship. Methods also may be improper because they violate an established standard of a trade or profession, or involve unethical conduct. Sharp dealing, overreaching, or unfair competition may also constitute improper methods.

Duggin, 234 Va. at 227-28, 360 S.E.2d at 836-37 (citations omitted).

Improper methods may be, but do not have to be independently illegal or tortious. Maximus, 493 S.E.2d 375 at 414, 493 S.E.2d at 378-379. Tortious interference means that the interference was intentional and improper under the circumstances. Id.

  • Hatred and Political Animosity Alone Are Insufficient

Notably, actions “solely motivated by spite, ill will and malice” do not, standing alone, suffice to establish the “improper” methods requirement for cases involving contracts terminable at will. Dunn, McCormack & MacPherson v. Connolly, 281 Va. 553, 558-60, 708 S.E.2d 867, 870-71 (2011). The Supreme Court of Virginia has stated that “the law will not provide relief to every disgruntled player in the rough-and-tumble world comprising the competitive marketplace.” Williams v. Dominion Tech. Partners, L.L.C., 265 Va. 280, 290, 576 S.E.2d 752, 758 (2003) (internal quotation marks omitted).

It should be noted that “[t]he fact that Virginia recognizes the existence of the tort of intentional interference with a contract does not mean that every contract relationship which is terminated or disrupted through the interference of a third party promoting its own interests will result in tort liability for that party. Rather, the law provides a remedy in tort only where the plaintiff can prove that the third party’s actions were illegal or fell so far outside the accepted practice of that ‘rough-and-tumble world’ as to constitute improper methods.” Lewis-Gale Med. Ctr., LLC v. Alldredge, 282 Va. 141, 153, 710 S.E.2d 716, 722 (2011). Applying these principles, the Virginia Supreme Court held that use of the term “organizational terrorist” to describe a doctor while “certainly unwise, unprofessional hyperbole, and may even indicate a personal animus” was not independently tortious and did not rise to improper methods. Id. at 152, 710 S.E.2d at 721-22.

  • Additional Hurdles in Federal Court

The United States District Court for the Eastern District of Virginia held that a competitive relationship is an “unstated” element of a prima facie case of tortious interference with contractual relations. See 17th St. Assocs., LLP v. Market Int’l Ins. Co. Ltd., 373 F. Supp. 2d 584, 601 (E.D. Va. 2005). The court has explained that a competitive relationship is necessary for a tortious interference claim because “the existence of a competitive relationship between a plaintiff and the defendant is the factual circumstance giving rise a common law duty actionable in tort.” 17th St. Assocs., LLP v. Market Int’l Ins. Co. Ltd., 373 F. Supp. 2d 584, 601 (E.D. Va. 2005). The court also held that direct or indirect contact between the defendant and the source of the business or contract expectancy is another element of a prima facie claim because if the defendant has not made contact, the defendant has not actually interfered. Id.

However, it should be noted that other courts in Virginia, including the Virginia Supreme Court have not found that a competitive relationship and direct or indirect contact are requisite elements of a claim for tortious interference.

  • Who Decides

Determining whether a defendant’s methods are improper and whether a plaintiff has demonstrated the elements of tortious interference is ordinarily a matter for the jury

and should not be decided in the context of either a motion to dismiss or a motion for summary judgment. See Commerce Funding Corp. v. Worldwide Sec. Servs. Corp., 249 F.3d 204, 213 (4th Cir. 2001) (reversing summary judgment grant on the grounds that reasonable jury could find that elements of tortious interference have been met); Ford v. Torres, 2009 WL 537563, at * 5 -7 (E.D. Va. 2009) (plaintiff sufficiently alleged elements to survive motion to dismiss); Chaves v. Johnson, 335 S.E.2d 97, 104 (Va. 1985) (reversing trial court’s decision to set aside jury verdict on tortious interference claim because it was a jury question to weigh the evidence to determine whether plaintiff met elements of claim); Bryarly v. Shenandoah Univ., 1996 WL 1065488, at *5 (Va. Cir. Ct. Jan. 31, 1996) (denying demurrer on tortious interference claim because “it is a jury question as to whether the actor’s methods are improper and whether the other elements of the tort of interference have been proved”).

  • What Are the Potential Damages

The Virginia Supreme court has held that a defendant who has engaged in tortious interference with contract or business expectancy is liable for “the pecuniary harm resulting from loss of the benefits of the relation, whether the interference consists of:

  • inducing or otherwise causing a third person not to enter into or continue the prospective relation or
  • preventing the other from acquiring or continuing the prospective relation.

Maximus, Inc. v. Lockheed Info. Mgmt. Sys., 493 S.E.2d 375, 378 (Va. 1997) (citing Restatement (Second) of Torts § 766B (1977)).

Pecuniary, or financial harm to the plaintiff in a tortious interference case can include lost future profits that the plaintiff would have received from the contract or prospective contract or business expectancy, as long as they “are capable of reasonable ascertainment and are not uncertain, speculative, or remote.” Hop-In Food Stores, Inc. v. Serv-N-Save, Inc, 440 S.E.2d 606, 608 (Va. 1994) (citation omitted).

II. Related Common Law Claim - Defamation Per Se

In addition to a claim for tortious interference with contract or business expectancy, it should be noted that certain words are considered defamatory per se in Virginia. At common law, defamation per se arises when a person or entity publishes the following types of words:

(1) Those which impute to a person the commission of some criminal offense involving moral turpitude, for which the party, if the charge is true, may be indicted.

(2) Those which impute that a person is infected with some contagious disease, where if the charge is true, it would exclude the party from society.

(3) Those which impute to a person unfitness to perform the duties of an office or employment of profit, or want of integrity in the discharge of the duties of such an office or employment.

(4) Those which prejudice such person in his or her profession or trade.

Tronfeld v. Nationwide Mutual Ins. Co., 272 Va. 709, 713, 636 S.E.2d 447 (2006) (emphasis added).

A plaintiff injured by defamation per se may recover compensatory damages for injury to reputation, humiliation, and embarrassment without demonstrating any financial loss. Id.

However, it should be noted that “speech which does not contain a provably false factual connotation, or statements which cannot reasonably be interpreted as stating actual facts about a person cannot form the basis of a common law defamation action.” Yeagle v. Collegiate Times, 255 Va. 293, 295, 497 S.E.2d 136 (1998). On the other hand, statements that “are capable of being proven true or false” are not expressions of opinion and may be actionable. Fuste v. Riverside Healthcare Assoc., 265 Va. 127, 133, 575 S.E.2d 858 (2003).

III. Related Statutory Claim - Va. Code Ann. § 18.2-499

In addition to potential claims for tortious interference with contract or business expectancy and defamation per se, detailed above, it should be noted that Virginia also has a statute that prohibits conspiracies to injure others in their reputation, trade, business or profession; rights of employees. See Va. Code Ann. § 18.2-499.

The Virginia Code § 18.2-499 provides:

A. Any two or more persons who combine, associate, agree, mutually undertake or concert together for the purpose of (i) willfully and maliciously injuring another in his reputation, trade, business or profession by any means whatever or (ii) willfully and maliciously compelling another to do or perform any act against his will, or preventing or hindering another from doing or performing any lawful act, shall be jointly and severally guilty of a Class 1 misdemeanor. Such punishment shall be in addition to any civil relief recoverable under § 18.2-500.

B. Any person who attempts to procure the participation, cooperation, agreement or other assistance of any one or more persons to enter into any combination, association, agreement, mutual understanding or concert prohibited in subsection A of this section shall be guilty of a violation of this section and subject to the same penalties set out in subsection A.

C. This section shall not affect the right of employees lawfully to organize and bargain concerning wages and conditions of employment, and take other steps to protect their rights as provided under state and federal laws.

Va. Code Ann. § 18.2-499

In Andrews v. Ring, 266 Va. 311, 585 S.E.2d 780 (2003), the Supreme Court of Virginia cautioned that this statute is limited to business and property interests, not to personal or employment interests. Similarly, in Jordan v. Hudson, 690 F. Supp. 502 (E.D. Va. 1988), aff’d, 879 F.2d 98 (4th Cir. 1989) the statute was held inapplicable to a claim that plaintiff was demoted as a result of plaintiff’s alleged actions. The claim was dismissed for failure to state a claim for relief because the statute addresses only injuries to one’s business, not injuries to one’s employment interests.

However, where a defendants’ acts “were committed in furtherance of a conspiracy to interfere with the [p]laintiffs’ business expectancy,” and where the plaintiff seeks damages for injury to business interests, not personal reputation, the statute is applicable. Compassionate Care Pediatrics, LLC v. Children’s Med. Ctr., Ltd., 100 Va. Cir. 6, 9 (Martinsville Cir. Ct. 2018).

In short, the Trump Accountability Project was wise to disband. The purported intent of the project, seeking to cancel people who worked for the current administration, by denying them post-government employment, raised a number of potential legal claims. Notably, liability does not require the existence of a written blacklist. In short, anyone who has knowledge of and intentionally seeks to harm another in a contractual relationship or business expectancy, proceeds at their own peril.

If you have any questions about this article, please contact Alison Feehan (afeehan@setlifflaw.com) at (804) 377-1279 or Steve Setliff (ssetliff@setlifflaw.com) at (804) 377-1261.