American Private Line Services, Inc. v. Eastern Microwave, Inc., 91-2177

• Decision Date: 17 September 1992
• Docket Number: No. 91-2177,91-2177
• Citation: 980 F.2d 33
• Parties: AMERICAN PRIVATE LINE SERVICES, INC., Plaintiff, Appellant, v. EASTERN MICROWAVE, INC., et al., Defendants, Appellees. . Heard
• Court: U.S. Court of Appeals — First Circuit

Page 33

980 F.2d 33

AMERICAN PRIVATE LINE SERVICES, INC., Plaintiff, Appellant, v. EASTERN MICROWAVE, INC., et al., Defendants, Appellees.

No. 91-2177.

United States Court of Appeals, First Circuit.

Heard Sept. 17, 1992.

Decided Nov. 24, 1992.

Peter L. Brown, Boston, Mass., for plaintiff, appellant.

Paul K. Connolly, Jr., with whom Damian R. LaPlaca and LeBoeuf, Lamb, Leiby & MacRae, Boston, Mass., were on brief, for defendant, appellee Eastern Microwave, Inc.

Before BREYER, Chief Judge, TORRUELLA and SELYA, Circuit Judges.

TORRUELLA, Circuit Judge.

Appellant, American Private Line, Inc. ("APL"), appeals from a directed verdict in favor of appellee, Eastern Microwave, Inc. ("EMI"). The verdict dismissed APL's three claims: interference with contractual relations, wrongful inducement to breach a contract, and interference with an advantageous relationship. We affirm the district court's judgment.

BACKGROUND

APL, EMI, and Cable & Wireless Communications, Inc. ("Cable & Wireless") are common carriers of microwave transmission facilities for telephone service, regulated by the Federal Communications Commission. APL and EMI have a relationship like that of a supplier and wholesaler; APL In 1986, EMI entered a one year contract for the purchase and sale of microwave transmission capacity between New York and Boston with Cable & Wireless. At the end of that year, Cable & Wireless decided not to renew its contract with EMI. Instead, it ordered its transmission capacity from APL. In its order, Cable & Wireless asked APL to: (1) waive or reduce its proposed installation costs; (2) provide authorization letters that would allow an AT & T connection between long distance carriers between Boston and New York; and (3) provide a renewal option.

buys transmission capacity in bulk from EMI and resells it.

APL acknowledged Cable & Wireless' request, stating that a response to the three requested terms would follow in a separate letter. Over a month later, the promised letter had not arrived, and Cable & Wireless wrote to APL expressing concern. APL never responded. Consequently, Cable & Wireless canceled its order for APL's transmission capacity, and eventually extended its original contract with EMI for one more year.

APL brought suit alleging that EMI attempted to hamper APL in its dealings with Cable & Wireless. Specifically, it asserts that EMI unfairly priced its services ¹ and provided services to Cable & Wireless that it provided to no one else. APL further contends that while EMI knew that APL was attempting to include EMI in its business dealings with Cable & Wireless, EMI secured Cable & Wireless' business for itself, without APL's knowledge.

EMI denies APL's allegations, reasoning that it merely engaged in lawful and competitive business activities.

DISCUSSION

I. Standard of Review

We accord directed verdicts plenary review. Gallagher v. Wilton Enterprises, Inc., 962 F.2d 120, 124 (1st Cir.1992) (per curiam). In doing so, we view all of the evidence in the light most favorable to the non-moving party, and draw all reasonable inferences in favor of that party. Id.

II. Intentional Interference with Contractual Relations and Wrongful Inducement to Breach a Contract

Under Massachusetts law, to prove both intentional interference with contractual relations and unlawful inducement to breach a contract, APL must first show that it had a contract. Because we find that it had no contract, we affirm the district court's directed verdict with respect to these claims.

The existence of a contract ordinarily is a question of fact, for the jury. Ismert and Associates v. New England Mut. Life Ins., 801 F.2d 536, 541 (1st Cir.1986). If, however, the evidence consists only of writings, or is uncontroverted, then the court can decide the issue. Id.

In the present case, the evidence of the alleged contract is uncontroverted. It consists of: a letter from Cable & Wireless to APL ordering transmission capacity and a letter from APL to Cable & Wireless accepting most of the terms in the purchase order. In addition to the writings, APL also points to an internal memo written by an EMI employee that acknowledged an "agreement" between Cable & Wireless and APL. However, the EMI employee is not a party to this alleged contract, and her statement is irrelevant to the meeting of the minds of APL and Cable & Wireless. Accordingly, the writings are the only evidence of the alleged contract. Thus, the issue did not require a jury decision.

In order to form a contract through writings, the writings relied upon must clearly and definitely state the contract's essential terms. Wilcox v. Shell Eastern Petroleum Products, 283 Mass. 383, 186 N.E. 562 (1933). The writings that APL insists form a contract, however, leave open three crucial terms. First, APL and Cable & Wireless never agreed to installation costs. These costs could range from $5,000 up to $80,000, 27% of the entire contract. Second, they never agreed on whether APL would provide a renewal option. Finally, APL never established that it could provide Cable & Wireless with authorization letters from AT & T. Without these letters, APL could not arrange an AT & T connection between long distance carriers between Boston and New York, which Cable & Wireless would have needed in order to provide long distance service between those cities. Thus, APL could not have brought into existence a "condition precedent" to any contract becoming binding. Cf. Massachusetts Municipal Wholesale Electric Co. v. Danvers, 411 Mass. 39, 577 N.E.2d 283, 287 (1991) (A condition precedent is "an event which must occur before a contract becomes effective or before an obligation to perform arises under the contract.").

Because APL and Cable & Wireless never agreed upon three essential terms, no reasonable jury could have found that they formed a binding contract. Thus, we affirm the district court's decision with respect to the claims of interference with contractual relations and wrongful inducement to breach a contract.

III. Interference with an Advantageous Relationship

APL's third claim alleges that EMI interfered with an advantageous relationship between APL and Cable & Wireless. The elements of this tort include: (1) a business relationship or contemplated contract of economic benefit; (2) the defendant's knowledge of such relationship; (3) the defendant's interference with it through improper motive or means ²; and (4) the plaintiff's loss of advantage directly resulting from the defendant's conduct. United Truck Leasing Corp. v. Geltman, 406 Mass. 811, 551 N.E.2d 20, 12 (1990).

We address each element in turn. First, to establish an advantageous business relationship, APL need not prove that it had a binding contract. A probable future business relationship anticipating a reasonable...