Dalley v. Dykema Gossett Pllc.

• Decision Date: 11 February 2010
• Docket Number: Docket No. 289046.
• Citation: 788 N.W.2d 679,287 Mich.App. 296
• Parties: DALLEY v. DYKEMA GOSSETT PLLC.
• Court: Court of Appeal of Michigan — District of US

287 Mich.App. 296

788 N.W.2d 679

DALLEY

v.DYKEMA GOSSETT PLLC.

Docket No. 289046.

Court of Appeals of Michigan.

Submitted Jan. 5, 2010, at Grand Rapids.

Decided Feb. 11, 2010, at 9:00 a.m.

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Kreis, Enderle, Hudgins & Borsos, PC (by Sean P. Fitzgerald), and Fossi & Jewell (by Karen Jewell and Lawrence J. Fossi) for plaintiff.

Smith Haughey Rice & Roegge (by Jon D. Vander Ploeg, Charles F. Behler, and John R. Oostema) for Dykema Gossett PLLC, John Ferroli, and Guidance Software, Inc.

Barnes & Thornburg LLP (by Jeffrey G. Muth) and Chittenden, Murday & Novotny LLC (by Donald A. Murday, David J. Novotny, and Vittorio F. Terrizzi) for Lincoln National Life Insurance Company and Lincoln Financial Advisors Corporation.

Before: STEPHENS, P.J., and GLEICHER and M.J. KELLY, JJ.

GLEICHER, J.

In this action alleging several intentional torts, plaintiff, H. Scott Dalley, appeals as of right a circuit court order granting defendants summary disposition pursuant to MCR 2.116(C)(8). We affirm in part, reverse in part, and remand for further proceedings.

I. FACTS AND UNDERLYING PROCEEDINGS

A. THE FEDERAL CASE

This case finds its genesis in a dispute between an insurance company and its agent. On April 13, 2004, defendants Lincoln National Life Insurance Company and Lincoln Financial Advisors Corporation (collectively Lincoln) sued Rodney Ellis, a Lincoln agent, and Lucasse, Ellis, Inc. (Lucasse), a company partially owned by Ellis, in the United States District Court for the Western District of Michigan. Lincoln's federal court complaint alleged fraud, breach of fiduciary duty, conversion, breach of contract, and tortious interference with business expectancies or relations. Defendants Dykema Gossett P.L.L.C. (Dykema) and John Ferroli, a Dykema member, represented Lincoln in the federal court action.

On April 15, 2004, a federal judge entered a temporary restraining order (TRO) prohibiting Ellis, Lucasse, and instant plaintiff Dalley from “deleting, erasing, destroying, shredding, secreting, removing, modifying, overwriting, replacing, or ‘wiping’ ” any computer data or files containing information related to Lincoln's customers and financial records. The paragraphs of the TRO directly relevant to plaintiff's present intentional tort action provide as follows:

9. Rodney D. Ellis and Lucasse, Ellis, Inc., all officers, owners, employees, principals, and agents of either of them who receive actual notice of this Order by personal service or otherwise, including but not limited to H. Scott Dalley, and all persons or entities acting in concert with any of them, are hereby ordered immediately upon service of this order to make available to a computer/data consultant retained by Plaintiffs all hard drives and other magnetic, optical or electronic media in the possession, custody, or control of any of them, including those hard drives and other magnetic, optical, or electronic media that they have the effective power to obtain, which contain any Lincoln Customer Records, for prompt non-destructive copying at Plaintiffs' expense. Plaintiffs shall minimize disruption to the producing person's business to the extent practicable. Plaintiffs shall return all hard drives and other magnetic, optical, or electronic media supplied pursuant to this Order within 24 hours, or such longer time as may be stipulated to or ordered by this Court. Plaintiffs' computer consultant shall maintain the copied data in a secure, locked location, and shall not review or inspect the data copied, or show it to Plaintiffs or their attorneys, until further order of this Court.

10. Rodney D. Ellis and Lucasse, Ellis, Inc., all officers, owners, employees, principals, and agents of either of them, including, but not limited to, H. Scott Dalley, and all persons or entities acting in concert with any of them who receive actual notice of this Order by personal service or otherwise, are hereby ordered immediately upon service of this order to provide for prompt copying of, at Plaintiffs' expense, (i) any and all “notes” data, files or records of present or former customers of any Lincoln affiliate, and (ii) any and all “Alice Reports,” “A-Roll” lists, and any other documents relating to any contemplated or processed change-in-employment status for any employees of the Henry Ford Health System with an account at any Lincoln affiliate.^{[ 1 ]}

On April 19, 2004, Lincoln's agents served plaintiff with the TRO in his Kentwood apartment, and with the assistance of personnel employed by defendant Guidance Software, Inc. (Guidance Software), copied all the data from all of plaintiff's computers. The events surrounding defendants' entry into plaintiff's apartment and the copying of his computer data form the basis of the instant lawsuit.

B. THE STATE COURT COMPLAINT

Plaintiff commenced this action on April 18, 2007, by filing in the Kent Circuit Court a complaint against Dykema, Ferroli, Lincoln, and Guidance Software. ² Plaintiff subsequently filed a substantially similar first amended complaint, which describes in detail the circumstances surrounding defendants' conduct in serving the TRO and copying plaintiff's computer data. Because the allegations within the amended complaint supply the facts necessary to our resolution of this case, we turn to an examination of that pleading.

The amended complaint avers that in April 2004, plaintiff worked out of his apartment as an independent computer consultant for several small businesses, including Lucasse. The computers in his apartment provided the means to generate his livelihood and held confidential information concerning all his clients, such as their user identifications and passwords. Plaintiff, who suffers from AIDS, also stored on his computers highly personal information, medical records, photographs, and tax returns.

On April 19, 2004, plaintiff's doorbell rang and someone requested that plaintiff permit entry into his apartment building. Because plaintiff was not expecting visitors, he did not respond. At approximately 11:00 a.m., loud pounding on his door “jolted” plaintiff awake and he “realized that the men outside had managed to slip through the security system downstairs.”

Plaintiff saw papers slid under his door, and he read them after the men had departed. The papers included the TRO, which “completely blindsided” plaintiff. Soon thereafter, plaintiff's telephone rang, but he did not answer it. The caller, Ferroli, left a message declaring that a federal court subpoena allowed him and others to enter plaintiff's apartment “to either take his computers and hard drives or copy what was on them.” Plaintiff “reasonably believed that he could not let Ferroli simply walk out the door with the computers,” and that “he had no choice and would go to jail” if he refused Ferroli access to his computers. Plaintiff thus “returned Ferroli's call and agreed to” allow Ferroli “to copy the information on his computers.”

Ferroli and several Guidance Software employees arrived, and plaintiff “led the group to the master bedroom where he kept two computers and four hard drives and, having seen from the subpoena that the case had something to do with Lincoln and Ellis, pointed them to the one and only hard drive that would contain Lincoln data.” But “[t]he intruders ... demanded everything.” The Guidance Software personnel connected laptop computers to plaintiff's machines and transferred “every bit of information on all [plaintiff's] computers and hard drives.” Only a “small percentage” of the information copied by the Guidance Software personnel related to Ellis, Lucasse, or Lincoln. The data transfer and copying process consumed 11 hours, during which period Ferroli “wandered in and out.” In frail health and underweight, plaintiff “did not sleep for several days thereafter.”

Four days after Ferroli and the Guidance Software technicians entered plaintiff's home, a Dykema attorney took plaintiff's deposition, urging him “to state on the record that he was suffering from AIDS[.]” As a result of illness, plaintiff had to complete the deposition later, by telephone from his bed. On July 1, 2004, Lincoln's attorneys informed the federal judge in the Ellis case that plaintiff had violated the TRO. Despite this claim and similar allegations in Lincoln's federal court complaint, defendants never uncovered or presented any evidence of wrongdoing by plaintiff or Ellis. Defendants' actions “traumatized [plaintiff], devastated his best customer, and thereby destroyed [plaintiff's] business.” According to the amended complaint, Lincoln bore vicarious liability for the conduct of Dykema, Ferroli, and Guidance Software, because these defendants “were Lincoln's agents and were acting within the scope of their agency.”

The amended complaint sets forth five intentional tort claims: invasion of privacy in the form of intrusion on seclusion or into private affairs; trespass; intentional or reckless infliction of emotional distress; abuse of process; and tortious interference with business relationships or expectancies. All defendants sought summary disposition of plaintiff's claims pursuant to MCR 2.116(C)(8). Dykema, Ferroli and Guidance Software filed a separate motion seeking summary disposition under MCR 2.116(C)(10). In a written opinion and order entered on September 9, 2008, the circuit court granted defendants' motions under (C)(8) and dismissed the entirety of plaintiff's complaint.

II. SUMMARY DISPOSITION ANALYSIS

A. STANDARD OF REVIEW

Plaintiff challenges the circuit court's grant of summary disposition in favor of defendants regarding all five counts of his complaint. This Court reviews de novo a circuit court's summary disposition ruling.

Walsh v. Taylor, 263 Mich.App. 618, 621, 689 N.W.2d 506 (2004). A court may grant summary disposition under MCR 2.116(C)(8) if “[t]he opposing party has failed to state a claim on which relief...