Adcom Products, Inc. v. Konica Business Machines USA, Inc.

• Decision Date: 14 August 1996
• Docket Number: No. 94-P-1303,94-P-1303
• Citation: 668 N.E.2d 866,41 Mass.App.Ct. 101
• Parties: ADCOM PRODUCTS, INC. v. KONICA BUSINESS MACHINES USA, INC., & others. 1 , 2
• Court: Appeals Court of Massachusetts

Page 866

668 N.E.2d 866

41 Mass.App.Ct. 101

ADCOM PRODUCTS, INC. v. KONICA BUSINESS MACHINES USA, INC., & others.¹, ²

No. 94-P-1303.

Appeals Court of Massachusetts Norfolk.

Argued Dec. 5, 1995.

Decided Aug. 14, 1996.

Janet Steckel Lundberg, Boston, for Konica Business Machines USA, Inc.

Before WARNER, C.J., and DREBEN, KASS, SMITH and FLANNERY, JJ.

WARNER, Chief Justice.

The plaintiff, Adcom Products, Inc. (Adcom), brought this action in the Superior Court against the defendant, Konica Business Machines, U.S.A., Inc. (Konica), for tortious interference with prospective contractual relations (Count I) and for a violation of G.L. c. 93A (Count II). Count I was tried before a jury. At the close of Adcom's case and at the close of the evidence, Konica moved for a directed verdict. These motions were both denied. The jury returned a special verdict in favor of Adcom on Count I in the amount of $410,000. The judge then denied Konica's motion for judgment notwithstanding the verdict or in the alternative for a new trial and entered judgment for Adcom on Count I. After a hearing on the G.L. c. 93A claim, the judge ordered judgment in favor of Konica on Count II. Konica's motion for reconsideration of the denial of the motions was denied. Konica appeals. (Adcom has not appealed from the judgment on Count II.) We affirm.

The standard for reviewing a judgment notwithstanding the verdict is "whether, anywhere in the evidence, from whatever source derived, any combination of circumstances could be found from which a reasonable inference could be drawn in favor of the plaintiff. Raunela v. Hertz Corp., 361 Mass. 341, 343 (1972), quoting Kelly v. Railway Express Agency, Inc., 315 Mass. 301, 302, (1943)." Freeman v. Planning Bd. of W. Boylston, 419 Mass. 548, 550, 646 N.E.2d 139 (1995). O'Shaughnessy v. Besse, 7 Mass.App.Ct. 727, 728-729, 389 N.E.2d 1049 (1979). Likewise, in reviewing the denial of Konica's motion for judgment notwithstanding the verdict, "we will construe the evidence most favorably to the plaintiff and disregard that favorable to the defendant " (emphasis supplied). Barbosa v. Hopper Feeds, Inc., 404 Mass. 610, 613, 537 N.E.2d 99 (1989), quoting from Cimino v. Milford Keg, Inc., 385 Mass. 323, 326, 431 N.E.2d 920 (1982).

Taking the evidence, and all reasonable inferences in favor of Adcom, the jury could have found the following facts. On November 1, 1989, Adcom became an authorized dealer for Konica for marketing Konica copiers. Around the summer or fall of 1990, Adcom became aware of a copier replacement program to be undertaken by Polaroid Corporation. Adcom's sales manager, James Dinell, sent Polaroid's representative, Jane Cameron, brochures on the Konica machines, and scheduled a trial demonstration of the equipment. This demonstration went extremely well, and Polaroid's representatives appeared to like the Konica product.

Polaroid then sent a request for quotation to Adcom, which, when answered, led Polaroid to select Adcom as one of its five finalists to make a presentation. The winner would get the contract. Adcom was the sole Konica representative to make the final group. The other two eliminated Konica bidders were Konica (the defendant in this case) and Conway Office Products (Conway).

Howard Yalen, branch manager of Konica, was informed at this time that his division of Konica was the highest of the three Konica bidders. While Cameron did not tell him who the other two bidders were, Yalen admitted assuming they were Adcom and Conway. Yalen also admitted concluding, upon hearing from Polaroid, that he (Konica) had no chance of obtaining the contract.

Yalen was no stranger to Adcom. In fact, Yalen's prior relationship with Adcom was marked by negative associations, including confrontations with them. Joanna Salkovitz, a family friend of Yalen's, testified unqualifiedly that Yalen made numerous comments to her over time denigrating J. Robert McCann, Adcom's president, and Adcom at various social gatherings. ³ Salkovitz also remembered that, at one social dinner, Yalen threatened to "make sure" that Adcom would be disqualified as a Konica dealer.

Adcom sought assistance in its presentation from the dealer support manager of Konica, Ken Matthews. Upon sharing news of the potential Polaroid deal with Matthews, Adcom successfully stalled an otherwise imminent termination of its Konica dealership contract for ninety days, a termination prompted by Adcom's earlier failure to meet its sales quotas. The January 22, 1991, presentation, according to the three Adcom participants, McCann, Dinell, and Matthews, was very successful. Matthews sent a letter to Polaroid expressing confidence in Adcom, McCann opined that Adcom was going to be awarded the contract, and Dinell stated he had the best rapport with Polaroid's Cameron that he had ever had with a buyer in a large corporation.

Approximately three months after the presentation, Cameron called Dinell and requested the immediate receipt of additional rental pricing information, to be used "right away for a meeting." Several weeks later, on May 6, 1991, Cameron called at 8:45 A.M. to request further cost information. Around 1:30 P.M. on the same day, Cameron called Adcom with an urgent message regarding Adcom's status as an authorized dealer, explaining that she had received a call from Yalen, who claimed that Adcom was no longer a dealer. Although Dinell responded accurately that indeed Adcom was an authorized dealer, both Dinell and Cameron agreed that the matter needed further investigation. ⁴

Yalen claimed that he acted to protect Konica; in previous situations, unauthorized dealers had used the Konica name and when copier problems had arisen his branch of Konica was held responsible.

Four days after this confrontation, Cameron asked Yalen's office to resubmit their bid, and she requested additional presentations from other vendors. Polaroid ultimately did not choose either Adcom or Yalen's Konica branch as their vendor; Konica's numbers were too high, and Yalen's telephone call to Polaroid regarding Adcom's status undermined the viability of Adcom's service and ultimately destroyed its deal. ⁵

In order to prevail in this case, Adcom was required to prove (1) a business relationship or contemplated contract for economic benefit with a third party; (2) Konica's knowledge of such a relationship; (3) Konica's interference with it through improper motive or means; and (4) Adcom's loss of advantage directly resulting from Konica's conduct. United Truck Leasing Corp. v. Geltman, 26 Mass.App.Ct. 847, 855, 533 N.E.2d 647 (1989), S.C., 406 Mass. 811, 816, 551 N.E.2d 20 (1990). See also Chemawa Country Golf, Inc. v. Wnuk, 9 Mass.App.Ct. 506, 509-510, 402 N.E.2d 1069 (1980). The jury, which had the option of believing all, some, or none of the testimony of the various witnesses, were warranted in concluding that Konica had intentionally and improperly interfered with a contemplated contract. See Cramer v. Commonwealth, 419 Mass. 106, 111, 113, 642 N.E.2d 1039 (1994). See also Kane v. Learned, 117 Mass. 190, 194 (1875); Liacos, Massachusetts Evidence § 2.10, at 58-60 (6th ed. 1994).

There was ample evidence of (1) a contemplated contract for economic benefit with a third party and (2) Konica's knowledge of such contract. United Truck Leasing Corp. v. Geltman, 26 Mass.App.Ct. at 855, 533 N.E.2d 647. Moreover, Konica has not relied on those elements. We address Konica's contention that Adcom failed to prove elements (3) and (4).

Regarding the third element, there was sufficient evidence of improper motive. ⁶ Generally, the propriety of the actor's motives in a particular setting necessarily depends on the attending circumstances, and must be evaluated on a case-by-case basis. G.S. Enterprises, Inc. v. Falmouth Marine, Inc., 410 Mass. 262, 273, 571 N.E.2d 1363 (1991). Here, the attending circumstances amount to enough evidence to warrant a finding that Yalen's real motive was to hurt Adcom. Contrast United Truck Leasing Corp. v. Geltman, 406 Mass. at 817, 551 N.E.2d 20.

In this case, the jury were warranted in finding an improper motive where the evidence, portrayed in the light most favorable to Adcom, revealed the following. First, Yalen harbored and expressed antipathy toward Adcom prior to the Polaroid scenario, which waxed upon hearing that Adcom was a potential winner of the contract; thus, Yalen was motivated by enmity. Second, Yalen knew he was eliminated from the original group of five finalists, and had himself concluded that his branch was definitely out of the deal; thus, he was not acting within a legitimate business or competitive scenario. Third, if Yalen was acting in part, as he explained, to protect the reputation of Konica, he could have simply notified his boss, Richard F. Clarke, instead of calling Polaroid directly. This was obviously not lost on the jury. Fourth, Yalen called Polaroid, knowing the information he conveyed would have an adverse effect on Adcom's ability to win the contract, and little to no effect on his own ability to win the contract. ⁷

From this evidence, the jury could have concluded that Yalen's decision to call Polaroid was based on retaliation or ill will toward Adcom, rather than the good of the Konica company or of his own branch.

Likewise, regarding the fourth element, there was adequate credible evidence that Adcom's loss of advantage directly resulted from Konica's conduct, in other words, that Adcom's loss of the contract directly resulted from Yalen's telephone call. The jury, the fact finder and final arbiter of the tort claim, could believe that Polaroid chose Adcom as one of its five finalists for the copier contract; that Polaroid was pursuing Adcom as a supplier when Cameron called Dinell requesting information regarding rental pricing three months after the presentation; and that Polaroid was still pursuing Adcom when on May 3, 1991, Cameron needed information for a meeting ...