Int'l Sales & Service Inc. v. Austral Insulated Pr

262 F.3d 1152

• Court: Court of Appeals for the Eleventh Circuit
• Decided: July 30, 2001
• Docket: 99-12939
• Status: Published

Opinion

AMENDED OPINION [PUBLISH]

IN THE UNITED STATES COURT OF APPEALS FILED FOR THE ELEVENTH CIRCUIT U.S. COURT OF APPEALS _________________________ ELEVENTH CIRCUIT JULY 30, 2001 THOMAS K. KAHN No. 99-12939 CLERK _________________________ D. C. Docket No. 98-00252-CV-DMM

INTERNATIONAL SALES & SERVICE, INCORPORATED, a Florida corporation,

Plaintiff-Appellant,

versus

AUSTRAL INSULATED PRODUCTS, INCORPORATED, a Georgia corporation,

Defendant-Appellee.

____________________________

Appeal from the United States District Court for the Southern District of Florida ____________________________

(July 30, 2001)

Before EDMONDSON, WILSON and MAGILL*, Circuit Judges.

______________________________________________ *Honorable Frank J. Magill, U.S. Circuit Judge for the Eighth Circuit, sitting by designation. MAGILL, Circuit Judge:

International Sales & Service, Inc. ("ISS") sued Austral Insulated Products,

Inc. ("Austral") for tortious interference with an advantageous business

relationship. After the jury returned a verdict for ISS, the district court entered

judgment as a matter of law for Austral. We affirm.

I.

ISS was a distributor of, and manufacturer's representative for, various

products, principally aviation wire. In 1990, ISS began providing aviation wire to

Shannon Aircraft Motorworks, later renamed Shannon Ireland and Shannon

Canada (together, "Shannon"). Construing the facts in the light most favorable to

the non-moving party, ISS was the sole distributor of aviation wire to Shannon

from 1990 through 1995. From 1992 to 1995, Shannon ordered wire from ISS 111

times, an average of about one order every nine business days.

To fill orders from Shannon, ISS obtained wire from Austral, a manufacturer

of insulated wire. ISS did not have a written distributorship agreement with

Austral. ISS used a freight forwarder to prevent Austral from discovering the

identity of ISS's clients and selling directly to them. Austral dealt with its

customers on a "quote by quote" basis, without any formalized relationships.

Under this system, customers called Austral and received a quote for the purchase

2 price of wire. Between 1989 and 1993, Austral's clients included a major

distributor, several smaller distributors such as ISS, and end-users.

In 1993, Austral changed course and entered into exclusive distributorship

agreements with distributors in Canada and the United States. As part of its new

relationship with its American distributor, Electrical Insulation Suppliers ("EIS"),

Austral agreed to end its relationships with other independent distributors in the

United States and to instruct its direct customers that orders within the continental

United States would have to be placed with EIS. In 1995, Austral stated that it

would no longer sell wire to ISS unless ISS disclosed the identity of its customers.

ISS initially refused, but agreed when Austral promised not to use the information

to sell directly to ISS's clients. After obtaining ISS's client information, Austral

contacted Shannon directly. Austral then stopped selling wire to ISS, leaving ISS

unable to fill subsequent orders from Shannon. ISS and its sole employee and

shareholder, German Bravo, went bankrupt.

On January 14, 1998, ISS sued Austral in Florida state court for tortious

interference with an advantageous business relationship. After Austral removed

the case to federal district court based on diversity jurisdiction, a jury heard the

action from August 10-12, 1999, and returned a verdict for ISS. The district court

then entered judgment as a matter of law in favor of Austral under Federal Rule of

3 Civil Procedure 50(b). The district court held that ISS failed to show an

advantageous business relationship, and, alternatively, that the privilege of

competition justifies any interference by Austral in the ISS-Shannon relationship.

ISS appeals.

II.

We review the district court's grant of summary judgment de novo. Ross v.

Rhodes Furniture, Inc., 146 F.3d 1286, 1289 (11th Cir. 1998). Under Florida law,

the elements of tortious interference with a business relationship are: (1) the

existence of a business relationship that affords the plaintiff existing or prospective

legal rights; (2) the defendant's knowledge of the business relationship; (3) the

defendant's intentional and unjustified interference with the relationship; and (4)

damage to the plaintiff. Ethan Allen, Inc. v. Georgetown Manor, Inc., 647 So.2d

812, 814 (Fla. 1994). A business relationship need not be evidenced by a contract,

but it generally requires "an understanding between the parties [that] would have

been completed had the defendant not interfered." Id.

A. Existence of a Business Relationship

The district court held that ISS failed to demonstrate a business relationship

with Shannon. The court emphasized that nothing bound Shannon to buy wire

from ISS, leaving Shannon free to take its business elsewhere. The court

4 concluded that it found "no case that holds that a history of discrete sales is not

[sic] sufficient to demonstrate an advantageous business relationship."

In examining ISS's tortious interference claim, we are confronted with a

seemingly divergent body of Florida law. Our analysis begins with Ethan Allen,

where the Florida Supreme Court addressed a dispute between Ethan Allen, a

furniture manufacturer, and its former furniture dealer, Georgetown Manor. 647

So.2d at 814. Georgetown decided to convert its Ethan Allen galleries to other

furniture outlets. Id. Ethan Allen responded by placing an advertisement in

several newspapers that announced its split with Georgetown and asked customers

who had unfilled orders with Georgetown to contact the new Ethan Allen outlets.

Id. Georgetown then sued Ethan Allen for tortious interference with its alleged

business relationship with past Georgetown customers. Id. The Florida Supreme

Court rejected Georgetown's claim, holding that Georgetown's relationship with its

89,000 past customers was not one upon which a tortious interference claim could

be established because Georgetown's hope that some of its past customers would

continue to buy from Georgetown was mere "speculation." Id. at 815. The court

concluded that “Georgetown had no identifiable agreement with its past customers

that they would return to Georgetown to purchase furniture in the future.” Id.

In finding no business relationship between Georgetown and its past

5 customers, the Florida Supreme Court distinguished Insurance Field Services, Inc.

v. White & White Inspection & Audit Service, Inc., 384 So.2d 303 (Fla. 5th DCA

1980). In Insurance Field Services, the Florida District Court of Appeals held that

the plaintiff, who had regularly been performing underwriting inspections,

premium audits, and loss control work for sixteen insurance company clients,

could establish a business relationship with these companies even though the

plaintiff and his clients did not have written agreements. Id. at 306. The Ethan

Allen court noted that the relationship in Insurance Field Services was "ongoing”

and "far different than the one maintained by a retail furniture dealer with 89,000

past customers." 647 So.2d at 815 n.1.

In Ferguson Transportation, Inc. v. North American Van Lines, Inc., 687

So.2d 821 (Fla. 1996), the Florida Supreme Court recently reiterated the distinction

made by Ethan Allen between relationships with the community at large and with

an identifiable customer. The Ferguson court examined a tortious interference

claim brought by Ferguson Transportation against North American Van Lines.

Ferguson contracted with North American to be North American's exclusive agent

in Broward County. Id. at 821-22. Subsequently, North American appointed

Advance Relocation & Storage of Florida, Inc. as its agent in West Palm Beach.

Id. at 822. After Advance Relocation intruded into Ferguson's territory in Broward

6 County, Ferguson sued, alleging that North American and Advance Relocation

tortiously interfered with Ferguson's relationships with its Broward County

customers. Id. The Florida Supreme Court rejected Ferguson's claim, holding that

Ferguson's relationship with Broward County's general population did not

constitute a business relationship; instead, the court agreed with the lower court's

determination that Ferguson was required to show a business relationship with an

identifiable person. Id. at 822 (citing North Am. Van Lines, Inc. v. Ferguson

Transp., Inc., 639 So.2d 32, 33-34 (Fla. 4th DCA 1994) ("At trial Ferguson was

unable to bring forth a single customer who would have patronized Ferguson but

for the interference by North American. Ferguson presented no one who booked a

move with North American through Advance Relocation who had been a customer

of Ferguson or was even a prospective customer of Ferguson.")); see also Sarkis v.

Pafford Oil Co., 697 So.2d 524, 526-27 (Fla. 1st DCA 1997) (noting the distinction

made by Ethan Allen and Ferguson between relationships with the community at

large and with an identifiable customer).

In Dunn v. Air Line Pilots Ass'n, 193 F.3d 1185 (11th Cir. 1999), this Court

recently recognized the distinction Florida courts draw between a relationship with

the community at large and with an identifiable customer. In Dunn, a group of

airline pilots that continued to work during a pilot strike sued a pilots' union that

7 placed the group on a list of "scabs" for tortious interference. Id. at 1189-90. The

pilots claimed that the union's "publication of the scab list prohibited them from

obtaining employment with any commercial airline-in other words, that it

interfered with the pilots' ability to sell their labor to the general community." Id.

at 1191. This Court rejected the pilots' claim, holding that a tortious interference

claim requires "a relationship with a particular party, and not just a relationship

with the general business community." Id. (citing Ethan Allen, 647 So.2d at 815);

see also Future Tech Int'l, Inc. v. Tae IL Media, Ltd., 944 F. Supp. 1538, 1570

(S.D. Fla. 1996) (Marcus, D.J.) (examining a tortious interference claim under

Florida law and distinguishing between relationships with the community at large

and ongoing relationships with existing customers).

In this case, ISS alleges a relationship with an identifiable customer,

Shannon, whom ISS continually supplied with aviation wire from 1990 to 1995.

Thus, we are not presented with a situation like Ethan Allen, where the plaintiff

merely alleged a relationship with the community at large. Instead, this case is

more similar to the relationship at issue in Insurance Field Services, where the

plaintiff had ongoing relationships with sixteen clients. 384 So.2d at 306; see also

Manufacturing Research Corp. v. Greenlee Tool Co., 693 F.2d 1037, 1040 (11th

Cir. 1982) (holding that the plaintiff, who manufactured and sold power cable

8 benders to electrical wholesale suppliers, "established a business relationship with

its sales representatives and various distributors of its product"). Moreover, from

1992 to 1995, Shannon ordered wire from ISS 111 times, an average of about one

order every nine business days. Although the district court correctly noted that

Shannon had no obligation to continue to purchase wire from ISS, neither did the

insurance companies in Insurance Field Services have an obligation to continue

using the plaintiff’s services. 384 So.2d at 304-06; see also Tamiami Trail Tours,

Inc. v. Cotton, 463 So.2d 1126, 1127-28 (Fla. 1985) (affirming the lower court's

finding of a business relationship with no apparent obligation to continue the

relationship); Magre v. Charles, 729 So.2d 440, 444 (Fla. 5th DCA 1999) (same);

see also Restatement (Second) of Torts § 766B cmt. c (1977) ("Also included [as

tortious interference with a business relationship] is interference with a continuing

business or other customary relationship not amounting to a formal contract.").

Austral correctly notes that ISS did not establish a likelihood that its

dealings with Shannon would be formalized in a written agreement. Austral points

to the Ethan Allen court’s statement that, generally, a business relationship requires

proof that an agreement would "in all probability have been completed if the

defendant had not interfered.” 647 So.2d at 815. This statement does provide

some suggestion that Florida courts would require ISS to prove that its relationship

9 with Shannon would have resulted in a contract had Austral not interfered.

However, Ethan Allen did not overrule Insurance Field Services, where there was

no evidence that the plaintiff and his customers would have formalized a written

agreement had the defendant not interfered. See 384 So.2d 303. Nor did Ethan

Allen overrule or criticize precedent that did not require the plaintiff in a tortious

interference case to prove that a contract would have been reached with its

business relationship had the defendant not interfered. See, e.g., Tamiami Trail

Tours, 463 So.2d at 1127-28 (affirming the lower court's finding of a business

relationship despite the apparent absence of a contract or a likelihood of an

imminent contract). Indeed, recent case law generally has not interpreted Ethan

Allen to require such proof. See, e.g., Magre, 729 So.2d at 444 (finding a business

relationship despite the absence of a contract or a likelihood of an imminent

contract); see also Restatement (Second) of Torts § 766B cmt. c (1977) (stating

that it is unnecessary for a prospective business relationship to "be expected to be

reduced to a formal, binding contract"); but see ISS Cleaning Servs. Group, Inc. v.

Cosby, 745 So.2d 460, 462 (Fla. 4th DCA 1999) (rejecting a tortious interference

claim when the plaintiff "failed to present competent substantial evidence of an

actual and identifiable agreement between Controlled Services and himself which

in all probability would have been completed had the alleged interference not

10 occurred").

Additionally, Austral points out that Ethan Allen requires proof of a

"business relationship that affords the plaintiff existing or prospective legal or

contractual rights." 647 So.2d at 814 (emphasis added). ISS makes no claim of

having either existing or prospective legal rights in its relationship with Shannon.

Nevertheless, some courts analyzing Florida tortious interference law have not

required the plaintiff to demonstrate the existence of legal rights in the alleged

business relationship. See, e.g., Tamiami Trail Tours, 463 So.2d at 1127-28

(affirming lower court's finding of a business relationship despite the apparent lack

of any legal rights in the relationship between the plaintiff and third party);

Insurance Field Servs., 384 So.2d 303 (same); Magre, 729 So.2d at 444 (same).

However, other Florida courts have emphasized plaintiffs' lack of legal rights with

their alleged business relationship in rejecting plaintiffs' tortious interference

claims. See, e.g., Register v. Pierce, 530 So.2d 990, 993 (Fla. 1st DCA 1988)

("The subject complaint does not allege any facts to demonstrate that the business

relationship between Register and the other eleven members of the Association

afforded Register any legal rights that have been substantively damaged due to

Hvide's alleged conduct; on the contrary, Register alleges that each of the twelve

members of the Association is an independent contractor in respect to piloting

11 services for vessels and their owners and masters."); Lake Gateway Motor Inn, Inc.

v. Matt's Sunshine Gift Shops, Inc., 361 So.2d 769, 772 (Fla. 4th DCA 1978) ("We

do not find any evidence of any legal rights in existence between the two operators.

A mere offer to sell a business which the buyer says he will consider, does not by

itself give rise to legal rights which bind the buyer or anyone else with whom he

deals."); American Bank v. Stiles, 731 S.W.2d 332, 343 (Mo. Ct. App. 1987)

(interpreting Lake Gateway to require that the plaintiff have existing legal rights in

his alleged business relationship, though rejecting this requirement, stating that

"[s]uch a rule is too restrictive given that Missouri cases have recognized instances

wherein a valid business expectancy exists with neither buyer nor seller having

acquired legal rights binding one or the other"); but see Azar v. Lehigh Corp., 364

So.2d 860, 862 n.2 (Fla. 2d DCA 1978) (distinguishing Lake Gateway by stating

that "the business relationship allegedly interfered with [in Lake Gateway] had

already deteriorated to the point that it could hardly be considered mutually

advantageous").

As a federal court, we are hesitant to insert ourselves in an area of state law

that is lacking in clarity. Instead, we think it better simply to assume for purposes

of this case that ISS had a "business relationship" with Shannon because, even if

such a relationship existed, Austral's actions are justified by the privilege of

12 competition.

B. The Competition Privilege

The district court held that, even if ISS established a prima facie case of

tortious interference, the privilege of competition justified Austral’s interference

with the ISS-Shannon relationship. Florida law recognizes the right of competitors

to compete for customers. Wackenhut Corp. v. Maimone, 389 So.2d 656, 658 (Fla.

4th DCA 1980).

The first issue we confront in determining whether Austral's actions are

protected by the privilege of competition is which party bears the burden of

persuasion. The answer is far from clear. See Restatement (Second) of Torts §

767 cmt. k (1977) (stating that "there is little consensus on who has the burden of

raising the issue of whether the interference was improper or not and subsequently

proving that issue"). The traditional approach places the burden on the defendant

to establish justification or privilege for his conduct. See W. Page Keeton et al.,

Prosser and Keeton on the Law of Torts § 130 (5th ed. 1984). However, critics of

this approach claim that placing the burden on the defendant to show justification

for his actions "requires too little of the plaintiff" because "[t]he major issue in the

controversy -- justification for the defendant's conduct -- is left to be resolved on

the affirmative defense of privilege." Leigh Furniture & Carpet Co. v. Isom, 657

13 P.2d 293, 303 (Utah 1982). Indeed, some commentators suggest that the

Restatement moves away from the traditional rule, instead placing the burden on

the plaintiff to prove that the defendant's interference is improper. See Prosser and

Keeton on the Law of Torts § 130; see also Alex B. Long, Tortious Interference

with Business Relations: "The Other White Meat" of Employment Law, 84 Minn.

L. Rev. 863, 870 (2000) (stating that "courts that have adopted the approach of the

Second Restatement typically place on the plaintiff the burden of showing that the

interference was improper or unjustified").

One treatise suggests that a Florida court has adopted the modern

Restatement approach. See Prosser and Keeton on the Law of Torts § 130 (citing

Lake Gateway as placing the burden on the plaintiff to show the defendant's

interference as improper). However, in Unistar Corp. v. Child, 415 So.2d 733 (Fla.

3d DCA 1982), a Florida appellate court stated that Lake Gateway

stand[s] for the rule that a showing of an intentional and unjustified interference with an existing business relationship which causes damage to the plaintiff establishes a prima facie case, and that the burden then shifts to the defendant to justify that interference. If the defendant can prove that the interference was lawful competition . . . the defendant will not be found to have committed the tort of wrongful business interference.

Id. at 734-35. Thus, the Unistar court apparently places the burden on the plaintiff

to show "unjustified" interference, but then requires the defendant to prove that the

14 interference was "lawful." Id.; see also Ethan Allen, 647 So.2d at 814 (listing "the

defendant's intentional and unjustified interference with the relationship" as part of

a tortious interference claim) (emphasis added). However, when courts talk about

a party's act as "unjustified" or "unlawful," they essentially are talking about the

same thing. See Four Nines Gold, Inc. v. 71 Constr., Inc., 809 P.2d 236, 245

(Wyo. 1991) (Urbigkit, C.J., dissenting) (referring to justification, privilege, and

"not improper" as "all being the same concept"). Therefore, it is not immediately

apparent what the Unistar court intended by placing the burden on the plaintiff to

show "unjustified" interference and then requiring the defendant to show that the

interference was "lawful." A clearer exposition on this issue is found in Greenberg

v. Mount Sinai Medical Center, 629 So.2d 252 (Fla. 3d DCA 1993), where the

court explicitly held that once the plaintiff establishes a prima facie case of

interference, the burden shifts to the defendant to justify the propriety of its

conduct. Id. at 256. Without deciding the issue, we assume that the burden is on

Austral to justify its interference with the ISS-Shannon relationship.

To establish the competition privilege, Austral must show that: (1) the ISS-

Shannon relationship concerned a matter involved in the competition between

Austral and ISS; (2) it did not employ improper means; (3) it did not intend to

create or continue an illegal restraint of competition; and (4) its purpose was at

15 least in part to advance its interest in competing with ISS. Restatement (Second)

of Torts § 768(1) (1977). Whether interference with a business relationship is

privileged "depends upon a balancing of the importance . . . of the objective

advanced by the interference against the importance of the interest interfered with,

considering all circumstances among which the methods and means used and the

relation of the parties are important." Heavener, Ogier Servs., Inc. v. R.W. Florida

Region, Inc., 418 So.2d 1074, 1076 (Fla. 5th DCA 1982); see also Morsani v.

Major League Baseball, 663 So.2d 653, 657 (Fla. 2d DCA 1995) ("Where there is

a qualified privilege to interfere with a business relationship, the privilege carries

with it the obligation to employ means that are not improper."); Manufacturing

Research Corp. v. Greenlee Tool Co., 693 F.2d 1037, 1040 (11th Cir. 1982)

("Although businesses are accorded leeway in interfering with their competitors'

business relationships, they must abide by certain 'rules of combat' and not use

improper means of competition."); Johnson Enters. v. FPL Group, Inc., 162 F.3d

1290, 1321 (11th Cir. 1998) ("Florida law recognizes the principle that actions

taken to safeguard or protect one's financial interest, so long as improper means are

not employed, are privileged."). "[W]hen there is room for different views, the

determination of whether the interference was improper or not is ordinarily left to

the jury, to obtain its common feel for the state of community mores and for the

16 manner in which they would operate upon the facts in question." Manufacturing

Research, 693 F.2d at 1040 (citation and internal quotations omitted).1

In Royal Typewriter Co. v. Xerographic Supplies Corp., 719 F.2d 1092

(11th Cir. 1983), this Court examined a tortious interference counterclaim brought

by Xerographic Supplies Corp. against Royal Typewriter, Inc. After Royal assured

Xerographic officials that it would not compete with Xerographic in Miami,

Xerographic became a dealer of a type of Royal photocopier. Id. at 1097.

However, Royal proceeded to send several letters to Xerographic's customers,

"inviting them to do business with Royal on a 'straight purchase' basis and

suggesting that it would be better to do business with Royal directly than with a

local dealer." Id. at 1098. After Royal sent these letters, Xerographic lost at least

one customer. Id. This Court rejected Xerographic's tortious interference claim,

1 The dissent notes that a Florida intermediate appellate court has stated: "The question of whether an action is privileged is a jury question." Monco Enters., Inc. v. Ziebart Corp., 673 So.2d 491, 492 (Fla. 1st DCA 1996); see also Greenberg v. Mount Sinai Med. Ctr., 629 So.2d 252, 256 (Fla. 3d DCA 1993); Hospital Corp. of Lake Worth v. Romaguera, 511 So.2d 559, 561 (Fla. 4th DCA 1987). However, the Florida Supreme Court has not decided whether privilege is an issue for jury consideration and the Florida intermediate appellate courts are split on the issue, with some courts finding privilege as a matter of law. See Babson Bros. Co. v. Allison, 337 So.2d 848, 850-51 (Fla. 1st DCA 1976); Nitzberg v. Zalesky, 370 So.2d 389, 392 (Fla. 3d DCA 1979), rev’d on other grounds, Ethyl Corp. v. Balter, 386 So.2d 1220 (Fla. 3d DCA 1980); Serafino v. Palm Terrace Apts., Inc., 343 So.2d 851, 853 (Fla. 2d DCA 1976), rev’d on other grounds, Ethyl Corp., 386 So.2d 1220; Ethyl Corp., 386 So.2d at 1224. Although we share some of Judge Wilson's concerns about granting judgment as a matter of law on privilege issues, since the Florida courts have not resolved this issue, we follow this Court's decision in Royal Typewriter.

17 holding that although Royal's promise may have established a cause of action for

breach of contract or fraud, the competition privilege barred Xerographic from

turning Royal's broken promise not to compete into a tortious interference claim.

Id. at 1105.

In this case, Austral promised ISS that it would not sell directly to ISS’s

customers if ISS told Austral the identity of its customers. However, Austral

subsequently broke that promise and sold directly to Shannon. The factual

similarities between this case and Royal Typewriter compel us to agree with

Austral that its actions are justified by the competition privilege.

In arguing that the competition privilege does not protect Austral's actions,

ISS directs our attention to case law outside Florida. See Monette v. AM-7-7

Baking Co., 929 F.2d 276, 281-83 (6th Cir. 1991) (holding that the defendant

improperly induced the breach of a business relationship when the defendant

accompanied the plaintiff on his sales route under the pretext of helping the

plaintiff increase his sales, but instead compiled a list of the plaintiff’s customers

and used the customer list to assume the plaintiff’s route); Island Air, Inc. v.

LaBar, 566 P.2d 972, 979-80 (Wash. Ct. App. 1977) (rejecting the defendant's

competition privilege defense when the defendant elicited secret information about

the plaintiff's at-will contract with UPS and broke its promise not to use the

18 information to compete with the plaintiff); see also Restatement (Second) of Torts

§ 767 cmt. c (1977) ("Fraudulent misrepresentations are also ordinarily a wrongful

means of interference and make an interference improper. A representation is

fraudulent when, to the knowledge or belief of its utterer, it is false in the sense in

which it is intended to be understood by its recipient. . . . One may be subject to

liability for intentional interference even when his fraudulent representation is not

of such a character as to subject him to liability for the other torts."). Were we

writing on a clean slate, perhaps the authority cited by ISS would be compelling.

However, under nearly identical circumstances, this Court has held that the

defendant's actions are justified by the competition privilege. See Royal

Typewriter, 719 F.2d at 1105. Therefore, the district court correctly held that

Austral's actions are protected by the privilege of competition.

III.

We AFFIRM the district court and hold that Austral's actions are justified by

the privilege of competition.

19 WILSON, Circuit Judge, concurring in part and dissenting in part:

I concur with the majority’s decision to assume that the burden is on Austral

to justify its interference with the ISS-Shannon relationship. I also concur with

their decision to assume that ISS had a “business relationship” with Shannon;

indeed, I would find that there was an existing business relationship under Ethan

Allen, which indicated that a claim for tortious interference could be maintained for

ascertainable relationships. See Ethan Allen, Inc. v. Georgetown Manor, Inc., 647

So. 2d 812, 815 (Fla. 1994); Insurance Field Servs., Inc. v. White & White

Inspection and Audit Serv., Inc., 384 So. 2d 303, 306 (Fla. Dist. Ct. App. 1980)

(holding plaintiff could establish business relationship even though plaintiff had no

written contracts). I would find however, that whether an action is privileged is a

jury question under Florida law, and that in this case, the jury had sufficient

evidence to find that Austral’s actions were not justified.

In Florida, when a plaintiff pleads and proves a prima facie case for tortious

interference, the burden is on the defendant to avoid liability by showing his action

is privileged or justified. See Monco Enterprises, Inc. v. Ziebart Corp., 673 So. 2d

491, 492 (Fla. Dist. Ct. App. 1996). “The question of whether an action is

privileged is a jury question.” Id.

Florida law generally recognizes the right of a business entity to compete for customers. See Royal Typewriter Co. v. Xerographic Supplies Corp., 719 F.2d

1092, 1105 (11th Cir. 1983); Wackenhut Corp. v. Maimone, 389 So. 2d 656, 658

(Fla. Dist. Ct. App. 1980). However, whether the competitive conduct is justified

is determined by the “rules of the game.” Insurance Field Servs., Inc. v. White &

White Inspection and Audit Serv., Inc., 384 So. 2d 303, 306-07 (Fla. Dist. Ct. App.

1980) (“Not only must defendants’ motive and purpose be proper but so also must

be the means.”). It can be difficult to determine what is proper or improper in

business competition; thus, it is the province of the jury to make such

determinations. See Manufacturing Research Corp. v. Greenlee Tool Co., 693

F.2d 1037, 1040 (11th Cir. 1982) (“when there is room for different views, the

determination of whether the interference was improper or not is ordinarily left to

the jury, to obtain its common feel for the state of community mores and for the

manner in which they would operate upon the facts in question.”) (quoting

Restatement (Second) of Torts § 767 cmt. 1 (1977)).

There was sufficient evidence for the jury to find that Austral’s actions were

not justified by a competition privilege. The jury heard testimony that Austral’s

national sales manager, Chris Pavlick, told ISS’s sole shareholder and employee,

German Bravo, that in order to place future orders with Austral, ISS would have to

provide the names of its customers. When Bravo refused to name his customers

21 and expressed his concern that Austral might “go around” him, Pavlick assured

him that such conduct would be “abominable” and that Austral would never do it.

Austral then contacted Shannon directly and stopped selling wire to ISS. ISS was

then unable to fill orders, and eventually went bankrupt.

In overturning the jury’s verdict for the plaintiff, the district court and the

majority substitute their own views that Austral’s actions were justified by a

competition privilege for the jury’s determination that Austral’s actions were not

justified. The district court improperly overturned a jury verdict on a question

Florida law reserves for the jury. Viewing the facts in the light most favorable to

the appellant, there is sufficient evidence for the jury to have found as it did. We

should hesitate to allow district courts to throw out jury verdicts when those

verdicts are based on determinations left to a jury under state law and are supported

by sufficient record evidence. I respectfully dissent.