Filed: Mar. 13, 1996
Latest Update: Mar. 02, 2020
Summary: United States Court of Appeals, Fifth Circuit. No. 94-10948. Dudley WARDLAW, Plaintiff-Appellee-Cross-Appellant, v. INLAND CONTAINER CORPORATION, et al., Defendants, Anheuser-Busch, Inc., Defendant-Appellant-Cross-Appellee. March 13, 1996. Appeals from the United States District Court for the Northern District of Texas. Before HIGGINBOTHAM, EMILIO M. GARZA and BENAVIDES, Circuit Judges. BENAVIDES, Circuit Judge: Defendant-appellant/cross-appellee Anheuser-Busch ("Anheuser") appeals from a jury v
Summary: United States Court of Appeals, Fifth Circuit. No. 94-10948. Dudley WARDLAW, Plaintiff-Appellee-Cross-Appellant, v. INLAND CONTAINER CORPORATION, et al., Defendants, Anheuser-Busch, Inc., Defendant-Appellant-Cross-Appellee. March 13, 1996. Appeals from the United States District Court for the Northern District of Texas. Before HIGGINBOTHAM, EMILIO M. GARZA and BENAVIDES, Circuit Judges. BENAVIDES, Circuit Judge: Defendant-appellant/cross-appellee Anheuser-Busch ("Anheuser") appeals from a jury ve..
More
United States Court of Appeals,
Fifth Circuit.
No. 94-10948.
Dudley WARDLAW, Plaintiff-Appellee-Cross-Appellant,
v.
INLAND CONTAINER CORPORATION, et al., Defendants,
Anheuser-Busch, Inc., Defendant-Appellant-Cross-Appellee.
March 13, 1996.
Appeals from the United States District Court for the Northern
District of Texas.
Before HIGGINBOTHAM, EMILIO M. GARZA and BENAVIDES, Circuit Judges.
BENAVIDES, Circuit Judge:
Defendant-appellant/cross-appellee Anheuser-Busch ("Anheuser")
appeals from a jury verdict awarding
plaintiff-appellee/cross-appellant Dudley Wardlaw ("Wardlaw")
damages for tortious interference with his employment. Wardlaw
cross-appeals, arguing that the district court erred in granting
Anheuser judgment as a matter of law on the issue of punitive
damages. We reverse the district court's denial of Anheuser's
motion for judgment as a matter of law, and affirm its judgment on
the issue of punitive damages.
I. Background
Wardlaw was employed as a National Account Service Executive
for Inland Container Corp. ("Inland"), which manufactures
corrugated paper products. Anheuser was one of Inland's customers.
Wardlaw successfully developed a quality and service program for
Anheuser. As a result of his work on the Anheuser account, Wardlaw
1
had access to information regarding the volume of Inland's business
with Anheuser.
On January 20, 1990, Wardlaw wrote a letter to Roger Stone of
Stone Container Corporation ("Stone"), an Inland competitor,
expressing interest in acting as a consultant for Stone. In the
letter, Wardlaw described his success with the Anheuser account,
including information about the volume of products that Anheuser
bought from Inland and the amount of revenues the account was
generating. Wardlaw indicated that Stone should call Anheuser to
confirm that Wardlaw's efforts had fostered Inland's growth.
Jim Riley, an employee of Stone, contacted Bob Scheetz,
Anheuser's purchasing agent for corrugated materials, on April 4,
1990 to determine whether Wardlaw had achieved the results
described in his letter. Scheetz requested a copy of the letter,
which was faxed the same afternoon. After reviewing the letter,
Scheetz realized that Wardlaw was communicating volume and revenue
information that Anheuser considered confidential. Scheetz
immediately called Ron Dailey, Inland's sales representative for
Anheuser, and expressed his concern over the release of the
information. Scheetz did not request that any action be taken
against Wardlaw or that the letter be reported to Wardlaw's
supervisors.
Dailey met with Wardlaw later that day and informed him that
Anheuser had a copy of the letter. Wardlaw became concerned that
the contents of the letter might be divulged to Inland's management
executives because various Inland and Anheuser representatives were
2
planning a golf trip together in the near future. He decided that
he should disclose the letter to his supervisor, Steve Raine.
After Raine received a copy of the letter, he sent it to Jim Cory,
Inland's Senior Vice President of Sales and Marketing, who placed
Wardlaw on administrative leave pending investigation of his
actions.
On April 12, 1990, Wardlaw was terminated for violating
Inland's Anti-Trust Compliance Policy and for offering to use
customer contacts he had acquired at Inland to influence major
customers to conduct business with Stone. After the termination,
Inland called several of its customers, including Anheuser, to
inform them that Wardlaw was no longer employed with Inland.
Wardlaw filed suit against Inland, alleging that his
termination violated the Age Discrimination in Employment Act and
the Employee Retirement Income Security Act. Wardlaw subsequently
sued Anheuser, alleging that Anheuser had tortiously interfered
with Wardlaw's employment contract. On August 22, 1992, Wardlaw
settled his claims against Inland.
After a jury trial, Wardlaw was awarded $390,000 in actual
damages for tortious interference and $1 million in punitive
damages. The district court granted Anheuser's motion for judgment
as a matter of law on the punitive damages issue, but denied
Anheuser's motion on the actual damages issue and its motion for
new trial.
II. Anheuser's Appeal
Anheuser initially attacks the district court's denial of its
3
motion for judgment as a matter of law, contending there was no
evidence to support the jury's finding that Anheuser tortiously
interfered with Wardlaw's employment contract and the evidence
overwhelmingly indicates that Anheuser's actions were privileged.
In reviewing a district court's disposition of a motion for
judgment as a matter of law, this Court applies the same test the
district court applied, without any deference to its decision.
Little v. Republic Ref. Co., Ltd., 924 F.2d 93, 95 (5th Cir.1991).
The applicable test provides:
[T]he Court should consider all of the evidence—not just that
evidence which supports the non-mover's case—but in the light
and with all reasonable inferences most favorable to the party
opposed to the motion. If the facts and inferences point so
strongly and overwhelmingly in favor of one party that the
Court believes that reasonable men could not arrive at a
contrary verdict, granting of the motions is proper. On the
other hand, if there is substantial evidence opposed to the
motions, that is, evidence of such quality and weight that
reasonable and fair-minded men in the exercise of impartial
judgment might reach different conclusions, the motions should
be denied....
Boeing Co. v. Shipman, 411 F.2d 365, 374 (5th Cir.1969) (emphasis
added).1 A conflict in substantial evidence must exist to create
a jury question.
Id. at 375.
To establish a claim for tortious interference, a plaintiff
must prove: (1) the existence of a contract subject to
interference; (2) willful and intentional interference with that
contract; (3) the intentional interference was a proximate cause
of plaintiff's damage; and (4) actual damage or loss occurred.
1
In a diversity case, federal law governs the standard of
review for sufficiency of the evidence. Gibralter Sav. v.
LDBrinkman Corp., 860 F.2d 1275, 1291 (5th Cir.1988), cert. denied,
490 U.S. 1091,
109 S. Ct. 2432,
104 L. Ed. 2d 988 (1989).
4
Victoria Bank & Trust Co. v. Brady, 811 S.W.2d 931, 939 (Tex.1991).
In the instant cause, Anheuser specifically attacks the jury's
findings with respect to the intentional interference and proximate
cause elements of Wardlaw's tortious interference claim. Anheuser
also complains of the district court's rejection of its privilege
defense.
A. Intent and Proximate Cause
Intentional interference does not require an intent to
injure, only that "the actor desires to cause the consequences of
his act, or that he believes that the consequences are
substantially certain to result from it." Southwestern Bell Tel.
Co. v. John Carlo Tex., Inc., 843 S.W.2d 470, 472 (Tex.1992)
(citing Restatement (Second) of Torts § 8A (1965)).2
"Substantially certain" requires that the interference be
"incidental to the actor's independent purpose and desire but known
to him to be a necessary consequence of his action." Southwestern
Bell Tel. Co. v. John Carlo Tex., Inc.,
813 S.W.2d 613, 619
(Tex.Ct.App.1991), rev'd on other grounds,
843 S.W.2d 470
(Tex.1992) (quoting Restatement (Second) of Torts § 766 cmt. j.
(1965)). In short, Wardlaw had to prove that Anheuser intended to
2
Wardlaw argues that the test for intent is whether Anheuser
committed acts that were calculated to cause damage to Wardlaw in
his lawful business. We disagree. In John Carlo, the Houston
Court of Appeals expressly disapproved of this definition to the
extent that it means intent to cause harm is a required element of
tortious interference. See Southwestern Bell Tel. Co. v. John
Carlo Tex., Inc., 813 S.W.2d 613, 619 (Tex.Ct.App.1991). The Texas
Supreme Court agreed, concluding that intentional interference does
not require an intent to injure, only an intent to cause
interference or a substantial certainty that interference will
occur. See John
Carlo, 843 S.W.2d at 472.
5
interfere with Wardlaw's employment or was substantially certain
that such interference would result from Scheetz's telephone call
to Dailey. Wardlaw also had to prove that such interference was a
proximate cause of Wardlaw's termination. See Travis v. City of
Mesquite, 830 S.W.2d 94, 98 (Tex.1992) (proximate cause consists of
cause in fact and foreseeability).
Although we perceive the issue to be close, an examination of
the evidence reveals that the facts and inferences would permit
reasonable jurors to conclude that Anheuser's interference was
intentional. The evidence presented raised a conflict sufficient
to create a jury question on the issue of intent. See Boeing, 411
F.2d at 375.
Wardlaw relies on two principle pieces of evidence to support
his claim of tortious interference. One piece of evidence involves
a phone call between Scheetz and Dailey that occurred in March,
approximately two or three weeks before the phone call regarding
Wardlaw's dissemination of confidential information. During this
conversation, Scheetz mentioned that he had heard that Wardlaw was
interested in a position with Stone. Wardlaw argues that Scheetz
released this information despite Wardlaw's request in his letter
to Stone that his interest in a consulting position not be
betrayed. The evidence indicates, however, that Scheetz's
disclosure was an offhand comment in the course of a regular
conversation with Dailey, made long before Scheetz was aware of the
6
letter to Stone.3
The second piece of evidence Wardlaw points to is the comment
of Jerry Lamm, Anheuser's group manager for packaging, when Cory
informed him that Wardlaw had been terminated: "I hope Anheuser-
Busch's involvement with the letter to Richard Stone had nothing to
do with it." Lamm also admitted that upon hearing about Wardlaw's
termination, he knew immediately that Wardlaw would not have been
fired if Scheetz had not called Inland.
Although Lamm and Scheetz each testified that Anheuser's sole
purpose was to prevent future dissemination of the confidential
information, Scheetz admitted during trial that he never contacted
3
This first conversation occurred in early March. On April 4,
1990, Scheetz contacted Dailey to inform him that Wardlaw had
released confidential information to Stone. Scheetz testified that
Riley called him that same day about the letter, that upon learning
about the confidential content he requested a copy, Riley faxed him
a copy a few hours later, he immediately called Dailey, and then
met with his supervisor, Jerry Lamm, to discuss the situation.
The parties point to no evidence to show that Scheetz was
aware of the letter or its contents before April 4. Thus, we
fail to see how Scheetz deliberately betrayed Wardlaw's
interest in a consulting job with Stone when he was unaware
that Wardlaw wanted that information kept confidential at the
time he revealed it to Dailey. Wardlaw admits as much in his
brief in discussing punitive damages when he asserts that "the
key evidence of ABC's intent to damage (injure) Wardlaw was
that long before Scheetz was even aware of the contents of
Wardlaw's letter, he told Ron Dailey that Wardlaw was looking
for a job with Stone, a competitor." (Emphasis added.)
Wardlaw is apparently trying to have it both ways, arguing on
the one hand that Scheetz knew Wardlaw did not want the
information that he was looking for a job betrayed based on
Wardlaw's letter, and on the other hand that Scheetz was
deliberately trying to get Wardlaw terminated long before he
knew the contents of the letter. We must presume therefore
that Scheetz mentioned Wardlaw's interest in a consulting
position before he was aware of the letter or of Wardlaw's
desire that his interest in employment with Stone not be
betrayed.
7
Wardlaw to prevent future dissemination, nor did he request that
Stone destroy its copy. Scheetz conceded that if he had made such
a request, Stone would have complied. Various Inland employees
testified that Anheuser did not request that Inland prevent further
dissemination by destroying all copies of the letter. After
Wardlaw was terminated, Scheetz and Lamm did nothing more to
prevent the dissemination.
As to proximate cause, Anheuser argues that Scheetz's phone
call was not a proximate cause of Wardlaw's termination; rather,
Wardlaw's action in giving the letter to Raine and his violation of
Inland's anti-trust policies caused his termination. Anheuser
asserts that it did not turn the letter over to anyone at Inland,
did not reveal or threaten to reveal the letter to Inland
executives, and exerted no pressure over Inland to terminate
Wardlaw. Various Inland employees testified that Wardlaw was not
terminated as a result of any pressure from Anheuser, but because
he had violated Inland's own policies and used information and
contacts that he obtained while an employee of Inland to Inland's
possible detriment.
Wardlaw points to the two phone calls from Scheetz to Dailey
as proximate causes of his termination. During the first phone
call, Scheetz mentioned that Wardlaw was applying for a job with
Stone. The record indicates, however, that this phone call was not
a proximate cause of Wardlaw's termination. Dailey described
Scheetz's comment as "Oh, by the way, I hear through the grapevine
that Dudley is looking for a job at Stone Container." Dailey then
8
asked Wardlaw about his job search, and Wardlaw admitted he was
seeking a consulting position so that he could spend more time on
an invention. Dailey testified that he did not tell anyone else at
Inland that Wardlaw was seeking a position at Stone. Wardlaw
presented no evidence that this phone call formed the basis of his
termination. Wardlaw has thus failed to carry his burden of proof
to establish that this phone call was a proximate cause of his
damages.
Wardlaw correctly asserts, however, that there was some
evidence that the second phone call, which concerned the release of
confidential information, was a proximate cause of his termination.
The phone call was a substantial factor in bringing about Wardlaw's
termination, without which the harm would not have occurred. See
Travis, 830 S.W.2d at 98.
Moreover, it was foreseeable that this phone call could result
in interference with Wardlaw's employment relationship with Inland.
Scheetz testified that he informed Dailey about the letter because
he expected Dailey to ensure that the release of information would
cease. He also stated that he was not surprised when he heard that
Wardlaw had met with his supervisor, Raine. Scheetz also admitted
that informing a company that its employee has done something wrong
is a serious matter for the employee accused of the wrongdoing. In
addition, Lamm testified that upon learning that Wardlaw had been
terminated, he knew instantly that Wardlaw would not have been
terminated if Scheetz had not called Inland. Evidence admitted at
trial indicated that Anheuser was upset about the release of
9
confidential information. Jim Cory, Inland's vice president of
sales, wrote a memo on April 4, 1990, which stated that Anheuser
had informed Dailey that it was not very happy about the letter.
We agree with Anheuser that the evidence of intent and
proximate cause4 is much less compelling in the instant cause than
the fact scenarios presented in the various Texas cases. See
Victoria Bank & Trust, 811 S.W.2d at 940 (bank retained security
interest after plaintiff paid off secured debt and then asserted
the security lien when plaintiff attempted to cash a draft at the
bank, refusing to pay until plaintiff agreed to deduct $40,000 from
the draft proceeds to apply to a disputed note); Sterner v.
Marathon Oil Co.,
767 S.W.2d 686, 688 (Tex.1989) (oil company
directed contractor to fire plaintiff because plaintiff had once
sued oil company); Sakowitz, Inc. v. Steck,
669 S.W.2d 105, 107
(Tex.1984), overruled in part by
Sterner, 767 S.W.2d at 690
(Sakowitz wrote letter to former employee's new employer asking
that it honor the non-competition agreement former employee signed
by firing employee); John
Carlo, 813 S.W.2d at 616-17 (plaintiff
sued telephone company for delays in performance of plaintiff's
contract with the city resulting from company's failure to timely
relocate its utilities, despite being informed that relocation was
necessary); Exxon Corp. v. Allsup,
808 S.W.2d 648, 651
(Tex.Ct.App.1991, writ denied) (gas company, which was aware of
4
Although Anheuser correctly asserts that Wardlaw's discussion
of the letter with Raine was also a proximate cause, Texas law
recognizes the existence of concurrent proximate causes. See
Travis, 830 S.W.2d at 98. All individuals whose actions contribute
to the injury, proximately causing the injury, are liable.
Id.
10
employee's lifetime contract as guard for ranch, told subcontractor
not to rehire employee at some point after it took over operations
of ranch's gate).
It is not this Court's function, however, to weigh
conflicting evidence and inferences, or to assess the credibility
of the witnesses. See Boeing, 411 F.2d at 375. Rather, our role
is merely to ensure that a substantial conflict existed in the
evidence to create a jury question.
Id. Scheetz's knowledge that
some action would be taken in response to his phone call, his
admission that informing an employer that an employee had engaged
in wrongdoing could have detrimental effects on the employee, his
failure to request that all copies of the letter be destroyed,
Lamm's statement that he hoped Anheuser's involvement with the
letter did not cause Wardlaw's termination, and Lamm's testimony
that he knew as soon as he heard about the termination that Wardlaw
would not have been fired if Scheetz had not called Inland provide
some evidence from which a jury could conclude that the elements of
intent and proximate cause were satisfied.
Viewing the evidence and the permissible inferences to be
drawn from it, we are loathe to declare that under such
circumstances no reasonable jury could have found that Anheuser
intentionally interfered with Wardlaw's employment and that its
actions proximately caused Wardlaw's termination. See Boeing, 411
F.2d at 374. Accordingly, we reject Anheuser's attack on the
intent and proximate cause elements of Wardlaw's alleged cause of
action.
11
B. Privilege
Anheuser contends that Wardlaw is not entitled to recover for
tortious interference because Anheuser's actions were legally
justified. Anheuser is privileged to interfere in the contract of
another if it is done in a bona fide exercise of Anheuser's own
rights or if Anheuser has an equal or superior right in the subject
matter to that of the other party. Sterner, 767 S.W.2d at 691. A
party may assert the privilege "even though that claim may be
doubtful, so long as it asserts a colorable legal right."
Sakowitz, 669 S.W.2d at 107 (emphasis added).
Legal justification is an affirmative defense upon which
Anheuser bears the burden of proof. Victoria Bank & Trust, 811
S.W.2d at 939. Because Anheuser is appealing the district court's
failure to grant judgment as a matter of law on the ground of
privilege, Anheuser must show that it presented evidence so
strongly and overwhelmingly in favor of a privilege that a
reasonable jury could not have reached a contrary verdict. See
Boeing, 411 F.2d at 374.
The Texas Supreme Court recently clarified the law on legal
justification. In Texas Beef Cattle Company v. Green, the court
held that good faith is irrelevant if the evidence establishes a
legal right to interfere: "[I]f the trial court finds as a matter
of law that the defendant had a legal right to interfere with a
contract, then the defendant has conclusively established the
justification defense and the motivation behind assertion of that
right is irrelevant." 39 Tex.S.Ct.J. 194, 1996 WL 11237, at *7
12
(Tex. Jan. 11, 1996) (citations omitted). Although prior supreme
court precedent indicated that "the defense of legal justification
or excuse only protects good faith assertions of legal rights,"
Victoria Bank & Trust, 811 S.W.2d at 939, the court in Green
rejected the assertion that actual malice could vitiate the
privilege. Green,
1996 WL 11237, at *9. Good faith, however,
remains an essential element where the defendant asserts only a
colorable legal claim.
Id. at *7.
During trial, Anheuser's purchase order agreement with Inland
was admitted in evidence. The agreement provided that "[v]endor
will not, without [b]uyer's prior written consent, advertise or
publish in any manner that it has furnished or contracted to
furnish to [b]uyer the goods or services specified herein."
(Emphasis added.) Wardlaw admitted that he did not seek Anheuser's
permission before disseminating the volume information to Stone.
Upon discovering Wardlaw's disclosure, Scheetz called Dailey
to complain of the release of volume information, which Anheuser
regarded as confidential based upon the purchase order agreement
and Anheuser's treatment of the information. The purchase order
agreement gave Anheuser a legal right to complain about the release
because Wardlaw's dissemination violated the agreement's express
terms. Scheetz's phone call to Inland represented Anheuser's total
involvement in the events precipitating Wardlaw's termination.
Anheuser's action (the interference) was reasonable and wholly
consistent with protecting its right of confidentiality. Because
the evidence clearly established that Anheuser had a legal right to
13
complain of Wardlaw's disclosure, Anheuser's assertion of that
right through Scheetz's call to Dailey was entitled to the
privilege. Anheuser was not required to prove that the right was
asserted in good faith. Id. Anheuser was entitled to a dismissal
of the claim against it based upon its legal right to interfere.
Even were we to conclude that the purchase order agreement
was insufficient to establish Anheuser's legal right to interfere
as a matter of law, we would nevertheless conclude that Anheuser
overwhelmingly proved the existence of a good faith assertion of a
colorable legal right. The evidence at trial indicates that
Anheuser considered the information confidential and took steps to
prevent its dissemination. Anheuser did not release information
regarding a supplier's volume to any other supplier. Inland
employees Dailey, Cory, and Raine testified that Anheuser kept
information about the volume from various competitors confidential.
Riley, a Stone employee, testified that Anheuser did not release
volume information and that no one at Anheuser had ever given him
this type of information. Additionally, the purchase order
agreement provided for confidentiality.
Although Wardlaw testified that volume information was not
confidential because it was not related to pricing, Wardlaw had no
personal knowledge of Anheuser's practice of keeping volume
information confidential. Indeed, Wardlaw's testimony is
apparently premised on Inland's policies concerning
confidentiality, not Anheuser's. Wardlaw failed to offer any
evidence to counter the testimony of various witnesses that
14
Anheuser considered this type of information confidential.5 We
conclude that Anheuser established that it considered the
information confidential, and acted on its right to protect that
confidentiality. Thus, Anheuser at the very least established a
colorable legal right to interfere.
If Anheuser's interference was a bona fide exercise of its
right to protect confidentiality, it is entitled to the privilege.
See Green, 1996 WL 11237, at *9; Victoria Bank &
Trust, 811 S.W.2d
at 939. The evidence indicates that Anheuser never requested that
any action be taken against Wardlaw, did not talk to any Inland
executives about Wardlaw's letter, and called Inland because
Wardlaw was an Inland employee. This evidence sharply contrasts
with Texas cases in which the courts have concluded that the
defendant's interference was not legally justified. See Victoria
Bank &
Trust, 811 S.W.2d at 940 (bank failed to release its
security interest in plaintiff's cattle after plaintiff paid off
secured debt and then asserted the security interest when plaintiff
sold the cattle);
Sterner, 767 S.W.2d at 690 (defendant directed
that employee be fired by subcontractor despite the fact that
employee's performance had been satisfactory);
Allsup, 808 S.W.2d
at 657-58 (defendant directed that subcontractor not rehire
plaintiff based on his failure to perform a job requirement, even
5
Wardlaw relies on Riley's testimony that he might be able to
figure out an approximate volume for other breweries based on
visits to Anheuser because he could see the boxes from different
breweries. Riley admitted, however, that his estimation would be
based upon his own observations and extrapolation, and that no one
at Anheuser would have provided him with this information.
15
though defendant knew a variance had been granted so that plaintiff
would not have to perform). Wardlaw violated what Anheuser
regarded as its right to confidentiality regarding volume
information. Anheuser understandably reacted to this violation by
contacting Inland.
Wardlaw nonetheless asserts that Anheuser's interference was
not a bona fide exercise because it did not attempt to prevent
further dissemination. Wardlaw relies on the fact that Anheuser
neither requested that Wardlaw or Stone turn over all copies of the
letter nor contacted Wardlaw to ensure that he would not
disseminate the information further. Wardlaw asserts that Anheuser
simply informed Inland that it was displeased with the release of
confidential information. Implicit in this statement, however, is
the inference that Anheuser does not want this type of release to
occur again.6
Despite Wardlaw's emphasis on actions Anheuser could have
taken when it discovered that confidential information had been
released, Texas law does not engage in this type of examination
6
Wardlaw also argues that the first phone call, in which
Scheetz mentioned that Wardlaw was seeking other employment, was
not done in a bona fide exercise of Anheuser's rights. We have
concluded, however, that this phone call was not a proximate cause
of Wardlaw's termination. Because legal justification is an
affirmative defense, we do not reach the issue of privilege unless
we first determine there was tortious interference. See Sterner,
767 S.W.2d at 689-90 (party asserting the privilege admits
interference occurred, but seeks to avoid liability based upon a
claimed interest that is being impaired or destroyed). Wardlaw did
not establish one of the necessary elements of tortious
interference. See Victoria Bank &
Trust, 811 S.W.2d at 939. Thus,
Anheuser did not have to prove that it was legally justified in
making this phone call.
16
when analyzing good faith.7 The Texas cases do not focus on what
the defendant could have done or might have done; rather, they
look at what the defendant actually did in assessing good faith.
Victoria Bank & Trust, 811 S.W.2d at 940;
Sterner, 767 S.W.2d at
691;
Allsup, 808 S.W.2d at 657-58; International Bank of Commerce
v. Union Nat'l Bank,
653 S.W.2d 539, 549 (Tex.Ct.App.1983, writ
ref'd n.r.e.).
We conclude that Anheuser's assertion of its right was bona
fide and that no reasonable jury could find otherwise. All
evidence indicated that Anheuser kept volume information
confidential, refused to release information on suppliers to their
competitors, and considered volume information important as a
negotiating tool. Upon learning that this information had been
released by an Inland employee, despite Anheuser's purchase order
agreement and conversations with Inland that this type of
information was confidential, Anheuser called its normal contact at
Inland, Dailey, to inform him of the release.
Anheuser clearly had a well-grounded and justifiable belief
that the information was confidential. See Sakowitz, 669 S.W.2d at
107. Its phone call to Inland was a bona fide exercise of that
right because Inland was the party with whom it had an
understanding that such information would not be released. To
conclude otherwise would effectively destroy the privilege of legal
7
Wardlaw repeatedly asserts that Anheuser should have
contacted him and should have fought to have him rehired once it
became aware of his termination. Anheuser was under no legal
obligation to take such actions and, thus, its failure to do so
provides no indication that Anheuser acted in bad faith.
17
justification. The district court erred in denying the motion for
judgment as a matter of law on the issue of legal justification.
See Boeing, 411 F.2d at 374. Because Anheuser established legal
justification for its actions, Wardlaw is precluded from recovering
on his asserted claim of tortious interference.8
III. Wardlaw's Cross-Appeal: Punitive Damages
Wardlaw complains on cross-appeal of the district court's
order denying him recovery for punitive damages. Our holding that
Wardlaw cannot recover compensatory damages for tortious
interference precludes his recovery for punitive damages. See
Federal Express Corp. v. Dutschmann, 846 S.W.2d 282, 284
(Tex.1993); Hadley v. VAM P T S,
44 F.3d 372, 375 (5th Cir.1995)
(finding of actual damages is a prerequisite to the receipt of
punitive damages under Texas law). The district court did not err
in denying Wardlaw punitive damages.
CONCLUSION
For the foregoing reasons, we reverse the judgment of the
district court awarding Wardlaw damages for tortious interference
and affirm the district court's denial of punitive damages.
Wardlaw's claim is dismissed with prejudice.
AFFIRMED IN PART; REVERSED AND RENDERED IN PART.
8
Our disposition of Anheuser's claim of legal justification
renders our consideration of its other claims of error unnecessary.
18
