Conte v. Emmons, 17-869-cv

• Decision Date: 10 July 2018
• Docket Number: August Term, 2017,No. 17-869-cv,17-869-cv
• Citation: 895 F.3d 168
• Parties: Anthony CONTE, Plaintiff-Appellee, v. Bob EMMONS, Individually and as Assistant District Attorney of Nassau County, New York, William Wallace, Individually and as Assistant District Attorney of Nassau County, New York, Mike Falzarno, Individually and as Special Investigator for the Office of the District Attorney of Nassau County, New York, Defendants-Appellants, Larry Guerra, City of New York, Rhoda Zwicker, Individually and as a Clerk in the Nassau County District Attorney's Office, Nassau County, New York, Nassau County District Attorney's Office, Katherine Rice, Individually and as District Attorney of Nassau County, New York, Christina Sardo, Individually and as Assistant District Attorney of Nassau County, New York, Nassau County, New York, Denis E. Dillon, Individually and as Former District Attorney of Nassau County, New York, Lisa Bland, Individually and as Attorney for the Police Department of the City of New York, Tefta Shaska, Individually and as a Detective for the Police Department of the City of New York, New York City Police Department, Robert Vinal, Individually and as Deputy Commissioner of the Police Department of the City of New York, John and Jane Does, 1-20, Unknown Individuals and Employees of the Nassau County District Attorney's Office, Phillip Wasilausky, Individually and as Assistant District Attorney of Nassau County, New York, Defendants.
• Court: U.S. Court of Appeals — Second Circuit

895 F.3d 168

Anthony CONTE, Plaintiff-Appellee,

v. Bob EMMONS, Individually and as Assistant District Attorney of Nassau County, New York, William Wallace, Individually and as Assistant District Attorney of Nassau County, New York, Mike Falzarno, Individually and as Special Investigator for the Office of the District Attorney of Nassau County, New York, Defendants-Appellants,Larry Guerra, City of New York, Rhoda Zwicker, Individually and as a Clerk in the Nassau County District Attorney's Office, Nassau County, New York, Nassau County District Attorney's Office, Katherine Rice, Individually and as District Attorney of Nassau County, New York, Christina Sardo, Individually and as Assistant District Attorney of Nassau County, New York, Nassau County, New York, Denis E. Dillon, Individually and as Former District Attorney of Nassau County, New York, Lisa Bland, Individually and as Attorney for the Police Department of the City of New York, Tefta Shaska, Individually and as a Detective for the Police Department of the City of New York, New York City Police Department, Robert Vinal, Individually and as Deputy Commissioner of the Police Department of the City of New York, John and Jane Does, 1-20, Unknown Individuals and Employees of the Nassau County District Attorney's Office, Phillip Wasilausky, Individually and as Assistant District Attorney of Nassau County, New York, Defendants.

No. 17-869-cv

August Term, 2017

United States Court of Appeals, Second Circuit.

ARGUED: MARCH 26, 2018

DECIDED: JULY 10, 2018

Eliza Mae Scheibel, Wilson Elser Moskowitz Edelman & Dicker LLP (Peter Meisels, on the brief), White Plains, NY, for Defendants-Appellants.

Michael H. Zhu, New York, NY, for Plaintiff-Appellee.

Before: Walker and Pooler, Circuit Judges, Cote, District Judge.^*

Judge Pooler dissents in a separate opinion.

John M. Walker, Jr., Circuit Judge:

Robert Emmons and William Wallace, prosecutors in the Nassau County District Attorney's Office, and Michael Falzarno, an investigator in the office, appeal from the denial of their post-trial motion for judgment as a matter of law, and the corresponding entry of judgment following a jury verdict in favor of Plaintiff Anthony Conte, on Conte's claims against them for tortious interference with contract under New York law. Because we conclude that there was insufficient evidence for a reasonable juror to have found at least two elements of Conte's claims—intent and causation—we reverse.

Conte alleged in relevant part that appellants tortiously interfered with his contracts when appellants investigated the activities of I Media, a company Conte founded to produce and distribute TV Time , a television magazine. The investigation focused principally on Conte's possible defrauding of "route distributors," individuals who paid I Media upfront for the exclusive right to distribute TV Time in a given area, and were to receive in return a sum for each magazine they delivered. To state it briefly, I Media faced serious difficulties in its early stages, and certain route distributors—who had paid upfront for their routes but had not received any magazines to distribute—became suspicious. Two distributors made complaints to the District Attorney's Office, which assigned the investigation to appellants at the Office's Criminal Bureau. Ultimately, nearly fifty individuals reported their suspicions to the District Attorney's Office, which assigned the investigation to appellants at the Office's Criminal Frauds Bureau. Appellants investigated the complaints, which included the issuance of grand jury document subpoenas and significant inquiries to route distributors, printers, and potential advertisers. No charges were ultimately filed, and, when I Media subsequently failed, Conte sued appellants and others for, inter alia , tortious interference with contract.

Following the close of evidence at a jury trial, appellants moved pursuant to Fed. R. Civ. P. 50(a) for judgment as a matter of law. The district court denied the motion and submitted the claims to the jury which ultimately found in favor of Conte on his tortious interference with contract claims against appellants and subsequently awarded Conte $1,381,500, which included $678,000 in punitive damages.¹ Appellants renewed their motion for judgment as a matter of law pursuant to Fed. R. Civ. P. 50(b), and, following developments not relevant here, see Conte v. County of Nassau , 596 F. App'x 1 (2d Cir. 2014) ; Conte v. Emmons , 647 F. App'x 13 (2d Cir. 2016), the district court denied the motion and directed entry of judgment in favor of Conte on the relevant claims. This appeal followed.

DISCUSSION

To warrant post-verdict judgment as a matter of law, the movant must show that the evidence, when viewed most favorably to the non-movant, was insufficient to permit a reasonable juror to have found in the non-movant's favor. See S.E.C. v. Warde , 151 F.3d 42, 46 (2d Cir. 1998). The standard is a high one, met only in "rare occasions." George Basch Co. v. Blue Coral, Inc. , 968 F.2d 1532, 1536 (2d Cir. 1992). The movant, generally, must be able to show a "complete absence of evidence supporting the verdict [such] that the jury's findings could only have been the result of sheer surmise and conjecture." Luciano v. Olsten Corp. , 110 F.3d 210, 214 (2d Cir. 1997) (internal quotation marks omitted).² For the reasons that follow, appellants met that strict burden here.

The unchallenged jury instructions correctly listed the elements of a tortious interference with contract claim under New York law: (i) the existence of a contract; (ii) defendants' knowledge of that contract; (iii) defendants' intentional inducement of a breach of that contract; (iv) a breach; (v) but for the defendants' actions, that contract would not have been breached; and (vi) damages. App'x 611. After a careful review of the trial record, we conclude that appellants are entitled to judgment as a matter of law because no reasonable juror could have properly inferred from the evidence that at least two elements were satisfied: intent and causation.

Intent . The jury was properly instructed that appellants could be liable for tortious interference with contract only if they acted with the "purpose of inducing [a] breach of contract." App'x 611. See, e.g. , NBT Bancorp Inc. v. Fleet/Norstar Fin. Grp. , 87 N.Y.2d 614, 621, 641 N.Y.S.2d 581, 664 N.E.2d 492 (1996). In NBT Bancorp , the Court of Appeals noted that the requirement of "an existing, enforceable contract" is what distinguishes a claim for tortious interference with contract from a claim for tortious interference with business relations, as to which interference with prospective contracts will suffice, id. , a separate tort claim that Conte did not bring. It is clear that New York law emphasizes the requirement that a tortious interference with contract claimant establish that the defendant purposefully intended to cause a contract party to breach a particular contract. Id. at 620, 641 N.Y.S.2d 581, 664 N.E.2d 492 ("Ever since tortious interference with contractual relations made its first cautious appearance in the New York Reports ... our Court has repeatedly linked availability of the remedy with a breach of contract."). As stated in NBT Bancorp , although the contract-based claim carries a lesser culpability requirement than the more general business-relations claim, the contract-based claim is strictly "defined by the nature of the plaintiff's enforceable legal rights." Id. at 621, 641 N.Y.S.2d 581, 664 N.E.2d 492 (citing Guard-Life Corp. v. S. Parker Hardware Mfg. Corp. , 50 N.Y.2d 183, 193, 428 N.Y.S.2d 628, 406 N.E.2d 445 (1980) ); see also Carvel Corp. v. Noonan , 3 N.Y.3d 182, 189–90, 785 N.Y.S.2d 359, 818 N.E.2d 1100 (2004).

Here, there was no evidence presented to permit a reasonable inference that appellants met the standard as set forth by the above authorities. To begin, there was no evidence that appellants had any personal interest in the breach of any contracts that Conte may have had with route distributors, printers, or advertisers. Rodrigues v. City of New York , 193 A.D.2d 79, 602 N.Y.S.2d 337 (1st Dep't 1993) is instructive. There, the First Department allowed an investigatory subject's tortious interference with contract claim against prosecutors to proceed past the pleading stage, but only on allegations that the prosecutors "sabotage[d]" plaintiffs' contracts "in order to extort bribes from plaintiffs." Id. at 88, 602 N.Y.S.2d 337 (internal quotation marks omitted). We are far afield from Rodrigues , which is the only instance we know of in which a court recognized with approval a New York law tortious interference with contract claim against prosecutors (or their staff) for their conduct in investigating allegations of criminal activity.

Conte's strongest evidence on intent (viewed in his favor) was that one of the appellants, Investigator Falzarno, had a personal animus towards Conte, which manifested itself in an aggressive and harmful handshake on delivery of a document subpoena, stopping a route distributor on the street to tell him that Conte was a "fraud[ ]" and "scam artist" and threatening that he could be arrested if he told Conte about that conversation, and a comment reflecting Falzarno's intent to "get" Conte. Conte also relies on the fact that Assistant District Attorney Wallace contacted certain of Conte's counterparties informing them that Conte was under investigation for fraud, and that the term "Ponzi scheme" may have come up in a conversation Wallace had with an attorney. There was virtually no evidence pertaining to Assistant District Attorney Emmons' state of mind.

For the jury to have inferred that this investigative conduct evinced an ulterior purpose outside of appellants' law enforcement goals could only have been "sheer surmise and conjecture." Warren v. Pataki , 823 F.3d 125, 139 (2d Cir. 2016) (quoting S.E.C. v. Ginder , 752 F.3d 569, 574 (2d Cir. 2014) ). Without evidence to...