2 Business and Torts Arises from careless errors or intentional actions Lawsuits involving businesses often have large awards, i.e. Pennzoil-Texaco case: Jury awarded $10.5 billion to the plaintiffPlaintiffs think of businesses as “deep pockets”Business liable under agency law if tort results in activity “within the scope of worker’s employment”TypesNegligence (Unintentional)IntentionalStrict Liability (Without fault) (Ch. 7)Torts Particular to Property (Ch. 8)
3 The Role of Tort Law Means “wrong” from French originally: A civil wrong, other than a breach of contract, for which the law provides a remedyA breach of a duty owed to another that causes harmCompensation for injuries wrongfully inflicted by the defendant on the plaintiffCivil, not criminal lawLaw is determined in each state--rules varyHowever, the basic principles are similar among all statesRemedies should place injured party in the position he/she would have been in prior to the tortFear of tort action deters injurious behavior by othersPunitive damages punish malicious behavior
4 TORTS BASED ON NEGLIGENCE Unintentional careless conduct that creates an unreasonable risk of harm to othersBreach of duty of careOwed to the plaintiffBreach through an act or omissionCausation (causal connection to the injury)Injury/DamagesThere can be a negligence action even if there was no intent to do harm
5 Negligence: Duty of Care and the Reasonable Person Standard The standard is how persons in the relative community ought to behaveOne must be reasonable at all times, under all circumstancesStandard: “What a reasonable person would do in same or similar circumstances”Applies to professions--Reasonable CPA, MD, attorney, etc.
6 Squish La Fish v. Thomco Specialty Products Squish holds patent on “Tuna Squeeze” (squeezes water & oil from tuna cans); ProPack is hired to assist with store displaysProPack brings in Thomco for advice on adhesive for the displaysThomco says recommended adhesive would wash off; Squish relies on the advice, but adhesive won’t wash offA Squish distributor is not happy with the situation; cancels its contractSquish sues Thomco for negligent misrepresentationDistrict Court grants summary judgment for Thomco; Squish appealsHeld: Reversed and remanded for disputed issues to go to trial. There may be reliance by Squish through ProPack on Thomco’s representations
7 Causation Causation between a party’s act & another’s injury Cause in fact shows defendant’s conduct is the actual cause of the event that created the injury (some courts call this the “but for” test)Proximate cause indicates that the liability bears a reasonable relationship to the negligent conductIn some cases, case is so obvious, res ipsa loquitur (the thing speaks for itself) appliesIf consequences are too remote -- no liabilityIf there is an intervening or superseding event--no liabilityChain of events created by a party’s actions must be foreseeableSome states replace proximate cause with legal cause that creates a substantial factor in bringing about the injury
8 Goldberg v. Florida Power & Light Co. Storm caused electric line to fall.Homeowner called Florida Power & Light (FPL).Six FPL trucks and a police officer arrived; FPL crew told officer he could leave.Crew turned off power in the area, which included a traffic signal. Crew aware that signal was off; did nothing about traffic.Goldbergs driving in traffic toward turned-off light. Car coming from side street caused an accident. Goldberg’s daughter was killed.Sued FPL for negligence – breach of duty to control traffic at the intersection.Jury awarded $37 million; trial judge reduced to $10 million.Appeals court reversed, holding FPL was not negligent – that the cause of the accident was driver who entered traffic, not the fact the traffic signal was out.Goldbergs appealed
9 Goldberg v. Florida Power & Light Co. Duty of Care: whether defendant’s conduct foreseeably created a broader ‘zone of risk’ that posed a general threat of harm to others.FPL had common law duty to warn of hazardous condition it created.FPL’s actions created a foreseeable zone of risk to motoristsFPL had a duty to warn motorists of danger – reasonable precautions to alert and protect drivers – notify police, road flares, direct traffic, etc.Proximate Cause: Standard of foreseeability. Human foresight would lead a person to expect that harm could be possible because of an omission (here failure to protect motorists).Fact finder decides proximate cause and foreseeability.HELD: Reversed. Defendant FPL breached duty of care and it was foreseeable that the omissions of care would reasonably place motorists at risk. Therefore proximate cause was established.
10 Defenses To A Negligence Action Comparative NegligenceDamages are reduced by the % of injuries caused by plaintiff’s own negligencePure Comparative NegligenceComparative Negligence 50% RuleAssumption of RiskThe injured party knew or should have known of risk and voluntarily assumed itComplete bar to the plaintiff’s caseContributory NegligencePlaintiff’s action contributed to the injuriesPlaintiff’s case is completely barred
11 McCune v. Myrtle Beach Indoor Shooting Range McCune with others played paintball at Myrtle Beach Indoor Shooting Range.Used protective face mask provided by the Range.She signed a general liability waiver, releasing the Range from all known or unknown dangers, with the exception of gross negligence on the part of the Range.She complained that mask did not fit well; restricted her range of vision.Mask caught on branch of a tree, lifting it off her face.She was hit in eye by paintball and blinded.Sued Range for negligence of not providing a mask that would fit better and give her protection.Trial court granted summary judgment in favor of Range. She appealed.
12 McCune v. Myrtle Beach Indoor Shooting Range HELD: Affirmed.Agreement was voluntarily signed that she: 1) assumed the risks, known or unknown and 2) she released Range from liability, even injuries sustained because of Range’s own negligence.McCune voluntarily entered into the release of liability.This is not construed as an exculpatory agreement.
13 INTENTIONAL TORTS Intent Person knew what he/she was doing Intent to do the act which reasonably would result in harm to the plaintiffKnew /should have known the possible consequences of an actionWillful misconduct
14 Intentional Torts Against Persons AssaultBatteryFalse ImprisonmentInfliction of Emotional DistressInvasion of PrivacyDefamation: Libel and Slander
15 Intent State of mind of defendant Person knew what he/she was doing Person “knew, or should have known, the possible consequences of the act”Knowledge that certain results would likely occurWillful acts invading protected interestsA reasonable person would have known that the action would create harmful circumstances
16 ASSAULT Placing plaintiff in fear of immediate bodily injury Fear: If a reasonable person under the same or similar circumstances would have apprehension of bodily harm or offensive contactThreats? May be an assaultPointing a gun? YesPoint a gun while other person sleeps? No assaultLetter threats? No assault (“immediate” requirement usually not met)Phone threats? Maybe. How close is the caller? On a cell phone outside the door or in another city?
17 BATTERYAssault & Battery may or may not be linked together in a lawsuitDefensesConsentPrivilegeSelf defenseDefense of others/Defense of propertyUnlawful “touching”Intentional physical contact without consentUse of fist, hand, or kickingUse of weapons, i.e. guns or stickUnwanted kiss? Has been held in some states to constitute battery
18 Fuerschbach v. Southwest Airlines Company Fuerschbach was a customer service representative for Southwest Airlines at Albuquerque airport.Airline prides itself on being “fun-loving, spirited company”.After new employees finish probation, they are often subject to a prank to celebrate the event.Her supervisor thought would be fun to set up a mock arrest.Albuquerque police officers came to the counter, told her she was under arrest and handcuffed her.She began to cry, so officers took her to the back.All the employees jumped and yelled “congratulations for being off probation.”Handcuffs removed; party began. She kept crying and was sent home.Psychologist said she suffered post-traumatic stress disorder.Fuerschbach sued everyone connected with the event on many grounds, including assault and battery.
19 Fuerschbach v. Southwest Airlines Company District court granted summary judgment for defendants and did not allow the matter to go to trial.District court: Officers were courteous and professional.HELD: Reversed on appeal. Summary judgment vacated on assault and battery claims. She can go to trial.Issue: Did the actions offend “a reasonable sense of personal dignity”?HELD: Jury might find that being handcuffed and leading a person in front of others offends a reasonable sense of personal dignity. Police handcuff – offensive contact.Side Note: Some other claims allowed to go forward; others were denied. The only claim against Southwest Airlines was a Workers’ Compensation claim because there was no intent by anyone to harm her at work.
20 False Imprisonment (False Arrest) Defense by businesses regarding detention of shopliftersRestraint was in a reasonable mannerRestraint was in a reasonable timeBasis for the detention was validIntentional holding or detainingFreedom to come and go is restrainedRestraintMay be physicalMay be mental (i.e., by verbal threats)Lawsuits often arise from detention of suspected shoplifters
21 Russell v. Kinney Contractors, Inc. Kinney Contractors advertised jobs in construction.Russell and others belong to construction union applied.Kinney didn’t want union workers.Workers arrived at Kinney’s offices, walked through an open gate, and went to an office to submit applications.Kinney closed the gate behind workers, blocking the exit, called police and claimed they were trespassing.Police arrived and workers were let out. Workers sued Kinney for false imprisonment, saying they were on property legitimately.Trial court dismissed the suit, saying this was a labor dispute under federal labor law and jurisdiction was with the National Labor Relations Board. Said this was not a common law tort for state courts to settle.
22 Russell v. Kinney Contractors, Inc. Russell Appealed.HELD: Reversed and case remanded.Court weighed the federal interest of labor disputes vs. the state’s interest to protect its citizens from wrongful conduct.Indignity, humiliation and disgrace suffered by plaintiffs would not be considered by NLRB, and NLRB cannot award compensatory damages as can the state.State court will look at whether the personal liberty was restrained and if false imprisonment occurred.
23 Infliction of Emotional Distress Intentional conduct: So outrageous, it creates severe mental or emotional distressPetty insults, annoying behavior, bad language? Usually not actionable; we must have “tough skin”Bill collectors or landlords who badger, are profane, or threaten or lay the background for a lawsuitSee Reynolds v. Ethicon Endo-Surgery, Inc.See Issue Spotter: “Dealing With the Elderly and their Heirs”
24 Reynolds vs. Ethicon Endo-Surgery, Inc. Reynolds was sales rep. for Ethicon in In 2002 she was assigned to a new division. Was based in Sioux Falls, S.D.Company reviewed the sales in her territories and decided her region was weak.A week after Reynolds told her supervisor, Burns, she was pregnant, he met with her; said Sioux Falls office would be closed; offered her the Louisville office or a severance package.She was later also offered the St. Louis office.Several weeks later, she suffered a miscarriage.Blamed the elimination of her position soon after she became pregnant for the reason of her miscarriage.She refused to transfer or take severance package. Was fired.Sued Burns and Ethicon for infliction of mental distress.
25 Reynolds vs. Ethicon Endo-Surgery District court granted summary judgment for defendant. She appealed.HELD. Affirmed.In order to be infliction of emotional distress, conduct must be “so outrageous in character, and so extreme in degree, as to go beyond all possible bounds of decency atrocious, and utterly intolerable in a civilized community.”While termination may be upsetting, it does not constitute extreme or outrageous conduct.
26 Invasion of PrivacyInfringement on a person’s right of solitude & freedom from unwarranted public exposureUse of a person’s name or picture without permissionIntrusion on solitude (i.e. wiretap)Placing a person in false light (publishing a false story)Public exposure of private facts (debts, drug use)DefensesRight of privacy waived by public figures, politicians, entertainers, sports personalities, etc.Information about an individual taken from public files or records
27 James v. Bob Ross BuickJames worked at Mercedes dealership owned by Bob Ross Buick. In 2002, he was sales rep. of the year. In 2004 he was fired.After firing, Buick company sent letters to customers who had worked with James: encouraged them to shop for Mercedes.Letter addressed as if from James. An assistant at Bob Ross signed James’s name to the letters.James sued for misappropriation of his name, a form of invasion of privacy.Trial Court: Summary judgment for Bob Ross. James appealed.
28 James v. Bob Ross Buick HELD: Reversed and remanded. Forgery of signature is a variant of invasion of privacy.Mere incidental use of a person’s name or likeness is not actionable.Can’t object to mere mention of name or appearance brought before the public when they are open to public observation.Appropriation occurs when there is commercial benefit of value from the use of the name or likeness.HELD: Reversed and remanded.This is not mere incidental use of James’s name.His name had commercial value – letters used to induce future sales for the car company.Benefit that Bob Ross received as a result of appropriating James’s name can be a part of the actual damages to him.James may seek nominal, compensatory, and punitive damages, if appropriate.
29 Defamation (Libel/Slander) Definition: An intentional false communication that injures a person’s or company’s reputation or good nameElements of the Tort:False or defamatory statementPublished or communicated to a third personCausing harm or injury to the plaintiffDefamation per se: Presumption of harmNo proof of harm/injury is necessaryExamples: person has committed a crime; has a sexually communicable disease; carries out business activities improperly, etc.Workplace Defamation: Info. given re: job performanceSee Issue Spotter: “Say Good Things About A Good Employee?”
30 Republic Tobacco v. North Atlantic Trading Company Republic and North America (NA) compete for premium roll-your-own cigarette papers, tobacco and other products.Two letters written by NA to clients were critical of Republic.First letter: attacked Republic’s business conduct; claimed a display box used by it violated an NA patent and trademark; and that NA had sued Republic for the infringement.NA had no patent or trademark on a display box; had not sued Republic.Second Letter: said NA was suing Republic for antitrust violations; that Republic engaged in “unfair competition” and “deceptive trade practices”.NA had in fact sued Republic for antitrust violations.Trial Court awarded Republic $3.36 million damages and trial judge reduced punitive damages from $10.2 to $4.08 million.
31 Republic Tobacco v. North Atlantic Trading Company A defamatory statement causes harm to reputation – false or unprivileged publication to a 3rd party.Per se: not necessary for a plaintiff to demonstrate actual damage to reputation.Per quod action: plaintiff must prove there was actual damage of a pecuniary nature.NA’s first letter was both false and defamatory.Both letters defamatory.HELD: $1 million is appropriate damage. Punitive damage reduced to $2 million.
32 “Tort Liability for Internet Servers” Q: If Internet users are involved in illegal activities, are the Internet servers liable?A: Generally no, as long as they were not aware of it or had reason to be aware of it.In Zeran v. America Online: AOL not liable in tort for defamatory message that AOL user sent. Sender is liable.Doe v. Cahill When defamatory statements are posted, victim of the statements has a right to obtain the identity of the party who sent the material (here Doe, the anonymous defendant).
33 Defenses to Defamation Truth is a complete defense in some states and is always a very strong defense.Absolute privilege is an immunityLegislators in committee sessionsParticipants in judicial proceedingsConditional privilege eliminates liability if the false statement was published in good faithIf there is no maliceIn order to protect a person’s legitimate interestsConstitutional privilegeMembers of the press may publish “opinion” about public officials, figures, or those of public interest if there is no actual malice (“absence of malice”)