Castle Rock Remodeling, LLC v. Better Bus. Bureau of Greater St. Louis, Inc.

• Citation: 354 S.W.3d 234
• Decision Date: 01 November 2011
• Docket Number: No. ED 96214.,ED 96214.
• Parties: CASTLE ROCK REMODELING, LLC, Appellant, v. BETTER BUSINESS BUREAU OF GREATER ST. LOUIS, INC., Respondent.
• Court: Court of Appeal of Missouri (US)

354 S.W.3d 234

CASTLE ROCK REMODELING, LLC, Appellant,

v.BETTER BUSINESS BUREAU OF GREATER ST. LOUIS, INC., Respondent.

No. ED 96214.

Missouri Court of Appeals, Eastern District, Division Three.

Nov. 1, 2011.Application for Transfer to Supreme Court

Denied Dec. 12, 2011.

Al W. Johnson, St. Louis, MO, for Appellant.

Joseph E. Martineau, St. Louis, MO, for Respondent.

ROBERT G. DOWD, JR., Presiding Judge.

Castle Rock Remodeling, LLC (“Castle Rock”) appeals from the judgment dismissing its claims for libel/slander and tortious interference with business expectancy against the Better Business Bureau of Greater St. Louis, Inc. (“BBB”). We affirm.

Castle Rock is a business engaged in retail sales and installation of windows and doors. BBB is a non-profit corporation that, inter alia, compiles consumer complaints about businesses, rates businesses on an A through F scale based on various criteria, and makes that information available to consumers through BBB's website. Businesses who meet a certain rating level, comply with BBB's code of conduct, and pay a membership fee can be “accredited” by BBB.

Castle Rock filed a petition against BBB for money damages alleging libel/slander and tortious interference with business expectancy based on BBB's reliability report on Castle Rock giving Castle Rock a “C” rating ¹ as well as statements regarding seventeen complaints filed against Castle Rock, BBB's concerns over Castle Rock's advertising, and the expiration of Castle Rock's accreditation. Castle Rock also sought declaratory judgment requiring BBB to give it an “A” rating and BBB accreditation.

Castle Rock pleaded an extensive history between Castle Rock and BBB. Between 2002 and April of 2010, Castle Rock was a member and accredited business of BBB and paid yearly dues to BBB. Castle Rock alleged Castle Rock's CEO had a falling out with BBB in 2008 after Castle Rock's CEO “became more vocal about his opposition to the manner in which complaints were being placed on Castle Rock's public record.” Essentially, Castle Rock alleged that after this falling out BBB gave Castle Rock a negative report and forced Castle Rock to resign its accreditation.

Specifically, Castle Rock asserted BBB's report and the “C” rating it gave Castle Rock directly states or implies that Castle Rock (a) is a generally unreliable firm which has recently lost its accreditation with BBB, (b) has numerous complaints filed against it, and has not responded in a timely manner or has demonstrated bad faith in an effort to resolve the complaints, (c) has failed to resolve the underlying cause or causes of the pattern of complaints, and (d) regularly engages in deceptive advertising and only changes their policies when admonished by BBB.

Castle Rock attached its BBB report to its First Amended Petition along with BBB's ratings system. BBB specifically advises that:

[t]he BBB rating is a grade based on a proprietary formula that uses information known to BBB and incorporates BBB experience with the business. The formula evaluates numerous categories of information, and reflects BBB weightings as to the relative importance of each category. This rating represents BBB's degree of confidence the business is operating in a trustworthy manner and will make a good faith effort to resolve any customer concerns fil[ ]ed with BBB.

BBB explains that it rates businesses based on seventeen elements including: type of business; time in business; competency licensing; complaint volume; unanswered complaints; unresolved complaints; serious complaints; complaint analysis; complaint resolution delayed; failure to address complaint pattern; government action; advertising review; background information; clear understanding of business; mediation/arbitration; accredited business status; and revocation. In its explanation of the elements and how it evaluates them, BBB often used the phrases like “in BBB's judgment,” “determined by BBB judgment,” “BBB uses its judgment in assessing,” and “BBB's will use their judgment.”

The BBB reliability report for Castle Rock showed Castle Rock had a BBB rating of “C.” The report stated that the reasons for this rating include “17 complaints filed against business,” and “[a]dvertising issue(s) found by BBB.” The report also stated that Castle Rock's “accreditation expired on 04/27/2010.”

With regard to the complaints, the report showed that BBB processed a total of seventeen consumer complaints against Castle Rock in the last thirty-six months and that the complaints were closed in the last thirty-six months with three closed in the last year. The report noted that the complaints concerned various issues: six concerned service issues; three concerned contract issues; three concerned product issues; two concerned repair issues; one concerned billing or collection issues; one concerned customer service issues; and one concerned sales practice issues. Of these seventeen complaints, the report identified that 11 of them were “Resolved.”

In detailing Castle Rock's complaint history, the report stated “[w]hen considering complaint information, please take into account the company's size and volume of transactions, and understand that the nature of the complaints and a firm's response to them are often more important than the number of complaints.”

The report also noted that BBB “challenged some advertised claims of the company concerning a price discount” and “savings claims” which “had the capacity to mislead consumers,” and that Castle Rock “agreed to modify its advertisements to comply with the [BBB] Code [of Advertising].” Specifically, the report stated:

[BBB] has challenged some advertised claims of this company concerning a price discount. We pointed out that that the Code of Advertising states, Advertisers may offer a price reduction or saving by comparing their selling price with: (a) their own former selling price[;] (b) the current selling price of identical merchandise sold by others in the market area[;] (c) the current selling price of comparable merchandise sold by the advertiser or by others in the market area. The company has agreed to modify its advertisement to comply with the Code.

[BBB] has questioned an advertised claim with this company concerning a range of savings. [ ] BBB brought to the firm's attention that advertisements concerning up to savings claims have the capacity to mislead consumers when the ad contains an undue or misleading display of the maximum savings amount. The company has agreed to modify its advertisement.

The reliability report also set forth the following in describing BBB's rating process:

Ratings are determined by a proprietary formula that represents BBB's opinion as to (1) the importance of each category, and (2) the appropriate score given to the business for each category.

* * *

BBB's rating of a business reflects BBB's opinion about the business based on information in our files and BBB experience. The rating is not a guarantee of a business' reliability or performance, and readers should consider a business' rating in addition to all other available information about the business.

The report further stated that “BBB Reliability Reports are provided solely to assist you in exercising your own best judgment.”

In response to Castle Rock's petition, BBB filed a motion to dismiss for failure to state a claim upon which relief can be granted. BBB asserted that any alleged defamatory statements about Castle Rock by BBB were opinion, and thus, not actionable. As to Castle Rock's claim of tortious interference with business expectancy, BBB also asserted Castle Rock could not establish the absence of justification or that BBB employed improper means when it published its report. The trial court granted BBB's motion and dismissed Castle Rock's petition with prejudice. Castle Rock appeals the dismissal of its claims for libel/slander and tortious interferences with business expectancy.²

Our review of the trial court's grant of a motion to dismiss for failure to state a claim is de novo. Diehl v. Fred Weber, Inc., 309 S.W.3d 309, 321 (Mo.App. E.D.2010). The propriety of the trial court's ruling on such a motion rests solely on the adequacy of the plaintiff's petition. Id. The facts contained in the plaintiff's petition are treated as true and are construed liberally in favor of the plaintiff to determine if they meet the elements of a recognized cause of action or of a cause that might be adopted in the case. Id. If the plaintiff's petition sets forth any set of facts that, if proven, would entitle him to relief, then the petition states a claim. Id.

We will address Castle Rock's points out of order and begin by addressing its second point because its disposition affects the other points on appeal. In its second point, Castle Rock argues the trial court erred “in granting [BBB's] motion to dismiss because Castle Rock's petition states a cause of action for defamation, and thus for the other counts in that [ ] BBB's representations are either statements of fact or are actionable statements of opinion which necessarily imply the existence of undisclosed defamatory facts.”

In Missouri, the elements of defamation are: (1) publication, (2) of a defamatory statement, (3) which identifies the plaintiff, (4) that is false, (5) that is published with a requisite degree of fault and (6) damages the plaintiff's reputation. Sterling v. Rust Communications, 113 S.W.3d 279, 281 (Mo.App. E.D.2003) (citing Nazeri v. Missouri Valley College, 860 S.W.2d 303 (Mo. banc 1993)).

The focus of this appeal is whether there was a “defamatory statement.” In determining whether a plaintiff can survive a motion to dismiss a defamation claim for failure to state a cause of action, there are two primary components. First, we must determine whether the statement is capable of having a defamatory meaning. Pape v. Reither, 918 S.W.2d 376, 379 (Mo.App. E.D.1996). Whether language is defamatory and actionable is a...