Morley v. Smith

309 F. App'x 103
Court of Appeals for the Ninth Circuit·Decided January 16, 2009·No. No. 07-15840·Published·Cited by 2 cases

Opinion

MEMORANDUM *

Christopher and Arden Morley (the “Morleys”) appeal the district court’s dismissal of their defamation and defamation per se claims against all defendants under Federal Rule of Civil Procedure 12(b)(6) (“Rule 12(b)(6)”) and the magistrate judge’s grant of summary judgment under Federal Rule of Civil Procedure 56 (“Rule 56”) with respect to all of their other claims against Steve and Kristine Alessio (the “Alessios”), and Harry and Ruth Tod-ice (the “Todices”). We have jurisdiction pursuant to 28 U.S.C. § 1291 and 28 U.S.C. § 636(c)(3). We affirm.

1. We review de novo a district court’s decision to grant summary judgment. Thomas v. City of Beaverton, 379 F.3d 802, 807 (9th Cir.2004). After reviewing the evidence in the light most favorable to the Morleys, we conclude that no genuine issues of material fact remain. The magis[105] trate judge correctly applied the relevant substantive law to the Morleys’ intentional interference with prospective advantage, trade libel, intentional infliction of emotional distress, and loss of consortium claims. See Olsen v. Idaho State Bd. of Medicine, 363 F.3d 916, 922 (9th Cir.2004). Because this is a diversity case, we apply the substantive law of Arizona.

To prevail on their intentional interference with prospective advantage claim, the Morleys must prove, inter alia, that the Alessios and the Todices knew of the allegedly destroyed contractual relationship or business expectancy, and that their improper and intentional interference with that relationship induced or caused a breach of the contract or termination of the expectancy. Miller v. Servicemaster By Rees, 174 Ariz. 518, 851 P.2d 143, 146 (Ariz.Ct.App.1992). The Morleys did not produce evidence that meets their burden of proof. The only business expectancy evidence the Morleys offered was that Kristine Alessio and Arden Morley had a planned sale between them. This business expectancy cannot support a claim against the Alessios, however, because Arizona law demands that the expectancy must exist between the plaintiff and a third party, not the plaintiff and the defendant. See Campbell v. Westdahl, 148 Ariz. 432, 715 P.2d 288, 294-95 (Ariz.Ct.App.1985). Further, the Morleys offered no evidence that the Todices knew of the Alessio/Morley business relationship. Accordingly, the magistrate judge appropriately granted summary judgment as to both the Alessios and the Todices.

To prevail on their trade libel claim, the Morleys must prove that the Alessios and the Todices intentionally published an injurious falsehood disparaging the quality of the Morleys’ property, and that the publication resulted in a pecuniary loss to the Morleys. See Gee v. Pima County, 126 Ariz. 116, 612 P.2d 1079 (Ariz. Ct.App.1980). The Morleys cannot prevail on their trade libel claim for two reasons. First, they have not adduced any facts that support a finding that either the Alessios or the Todices published any false information. All complained-of communications derived from Kristine Alessio’s and Ruth Todice’s belief that Arden Morley filed inconsistent registration forms with TICA, and Arden Morley admitted to filing “inaccurate” forms. Second, the Alessios and the Todices assert the conditional privilege applicable to trade libel and defamation claims, which applies if they “act[ed] in furtherance of some interest of social importance” and can thus be said to have a qualified privilege to make the statements. Green Acres Trust v. London, 141 Ariz. 609, 688 P.2d 617, 620 (1984). Arizona law provides a two-part test for determining whether an action is so privileged: (1) there must be an occasion for the privilege and (2) the occasion for the privilege must not be abused. Id. at 624. We agree with the magistrate judge that communications within TICA regarding the accuracy of the Morleys’ breeding implicates the privilege. Whether the privilege is abused is a question of fact typically reserved for the jury, though a court may find that there was no abuse in the absence of evidence of “actual malice” or “excessive publication.” Id. The Morleys did not present any evidence of actual malice or excessive publication. Accordingly, the magistrate judge appropriately granted summary judgment.

To sustain their claim for intentional infliction of emotional distress, the Morleys must provide proof that the Alessios and the Todices: (1) engaged in intentional or reckless conduct, (2) that was extreme and outrageous, and (3) caused the Morleys (4) severe emotional distress. Midas Muffler Shop v. Ellison, 133 Ariz. 194, 650 P.2d 496, 499 (Ariz.Ct.App.1982). The [106] Morleys cannot show any extreme and outrageous conduct. Accordingly, the magistrate judge appropriately granted summary judgment.

Loss of consortium is a derivative claim in Arizona; to succeed, the Morleys must prove that the Alessios and the Tod-ices committed an underlying tort against Arden Morley. Barnes v. Outlaw, 192 Ariz. 283, 964 P.2d 484, 487 (1998). As discussed above, all claims against the Alessios and the Todices were properly dismissed. Accordingly, the magistrate judge appropriately granted summary judgment as well.

2. We review de novo a motion for dismissal for failure to state a claim. Miller v. Yokohama Tire Corp., 358 F.3d 616, 619 (9th Cir.2004). If matters outside the pleadings are submitted, the motion to dismiss under Rule 12(b)(6) is treated as one for summary judgment under Rule 56. See Fed.R.Civ.P. 12(b); Del Monte Dunes at Monterey, Ltd. v. City of Monterey, 920 F.2d 1496, 1507-08 (9th Cir.1990).

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Morley v. Smith, 309 F. App'x 103 (9th Cir. 2009).

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