Peg Westphal v. Smelser, No. 2007AP827 (Wis. App. 7/3/2008), 2007AP827

• Decision Date: 03 July 2008
• Docket Number: No. 2007AP827,2007AP827
• Parties: Peg Westphal, Plaintiff-Respondent, v. Peggy Ann Smelser, Margaret Zweifel and Greenbrier & Russel, Inc., Defendants-Appellants.
• Court: Wisconsin Court of Appeals

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Peg Westphal, Plaintiff-Respondent, v. Peggy Ann Smelser, Margaret Zweifel and Greenbrier & Russel, Inc., Defendants-Appellants.

No. 2007AP827

Court of Appeals of Wisconsin, District IV.

Opinion Filed: July 3, 2008.

APPEAL from an order of the circuit court for Dane County: RICHARD G. NIESS, Judge. Reversed.

Before Higginbotham, P.J, Dykman and Bridge, JJ

¶ 1 DYKMAN, J

Peggy Ann Smelser, Margaret Zweifel, and Greenbrier & Russel, Inc. (Smelser and Zweifel) appeal from an order denying their motions for summary judgment. They contend that the circuit court erred in concluding that there are disputed issues of material fact in Peg Westphal's action for civil conspiracy and tortious interference with employment. We conclude that the undisputed facts in the record do not support Westphal's claims, and therefore reverse.

Background

¶ 2 The following facts are taken from the parties' submissions on summary judgment. Peg Westphal was an at-will employee of WEA Insurance Corporation (WEA Trust), from 1984 until 2006. In late 2004 and early 2005, WEA Trust was in the process of developing a program to transition to a new software system (the program). In the fall of 2004, Fred Evert, who had recently been elected president of WEA Trust, selected Westphal to be WEA Trust's director of special projects. As director of special projects, Westphal was responsible for the change management (CM) piece of the program. Westphal was responsible for managing the change that WEA Trust personnel would experience during the program. As director of special projects, Westphal initially reported to Evert. In January 2006, Evert became CEO of WEA Trust, in addition to president. At around that same time, Peggy Ann Smelser, WEA Trust's chief operating officer, advised Evert to have Westphal report to Smelser for organizational and structural reasons. Evert decided that Westphal should begin reporting directly to Smelser.

¶ 3 WEA Trust hired two consulting firms to evaluate its program. The first firm, Proxicom, issued a report on March 27, 2006, that identified problems within the program. The other firm, Greenbrier, was hired to assist WEA Trust with its CM efforts and take a closer look at the CM component of the program.

¶ 4 In mid-March, 2006, Greenbrier sent consultant Margaret Zweifel to WEA Trust for this purpose. WEA Trust expected Zweifel to assess the status of CM and to develop a strategy to improve the CM component of the program. In assessing WEA Trust's CM efforts, Zweifel interviewed fifteen key members of the program team. She then typed a summary of the interviews, reflecting a handful of positive or neutral comments about CM and Westphal, as well as some negative feedback concerning Westphal's leadership of CM.

¶ 5 Zweifel and Smelser met on Monday, March 27, and discussed the results of the interviews. Smelser then asked Zweifel whether she would be available to work for WEA Trust after her contract was concluded at the end of the week. Smelser set up a meeting with Evert for Friday, March 31, for Smelser and Zweifel to share their findings and concerns with him.

¶ 6 Smelser and Zweifel met together in the afternoon of Thursday, March 30, and then met with Evert on the morning of Friday, March 31. Smelser relayed to Evert the negative feedback she had received concerning Westphal's performance as director of special projects. Zweifel reported her findings regarding Westphal's performance, including that members of the program team lacked confidence in Westphal. Evert asked Zweifel whether she believed Westphal could remain in CM and be effective. Her response to Evert was "no," and that it was "too late" for that.

¶ 7 Between his March 31 meeting with Smelser and Zweifel and April 4, Evert met with Smelser and the two vice presidents of WEA Trust, Denise DeLong and Neal Kaderabek, to discuss Westphal's status as director of special projects. At this meeting, everyone agreed that Westphal should be removed from the position of director of special projects. Evert decided to do so.

¶ 8 On April 4, 2006, Evert and Smelser met with Westphal, and Evert informed Westphal of his decision. WEA Trust offered Westphal an alternative position of staff development specialist, a position crafted specifically for her, for a limited term and at a reduced salary. Alternatively, Westphal was offered a severance package, in exchange for a release. Westphal declined both options and her employment with WEA Trust ended April 30, 2006. Zweifel was given a new one-year contract with WEA Trust.

¶ 9 Westphal sued Smelser and Zweifel for conspiracy to interfere with her employment relationship, conspiracy to maliciously injure her business reputation, and tortious interference with her employment relationship. Smelser and Zweifel appeal from the circuit court's denial of their motions for summary judgment.

Standard of Review

¶ 10 We review summary judgments de novo, applying the same methodology as the circuit court. Green Spring Farms v. Kersten, 136 Wis. 2d 304, 316-17, 401 N.W.2d 816 (1987). Under WIS. STAT. § 802.08(2), summary judgment shall be granted "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law."

¶ 11 First, we look to whether the plaintiff's complaint states a claim. Green Spring Farms, 136 Wis. 2d at 317. Then, we examine the moving party's submissions to determine if they make a prima facie case for summary judgment; here, we must determine whether Smelser and Zweifel have established a defense to defeat Westphal's claims. See Grams v. Boss, 97 Wis. 2d 332, 338, 294 N.W.2d 473 (1980). Next, we examine the submissions of the opposing party to determine if there are any disputed material facts, or undisputed material facts from which reasonable alternative inferences may be drawn, necessitating a trial. Id.

¶ 12 Thus, if the moving party establishes entitlement to judgment as a matter of law, "the opposing party may avoid summary judgment only by setting forth specific facts showing that there is a genuine issue for trial." Transportation Ins. Co., Inc. v. Hunzinger Constr. Co., 179 Wis. 2d 281, 291, 507 N.W.2d 136 (Ct. App. 1993) (citation omitted). Summary judgment for the defendant is appropriate if the plaintiff presents no credible evidence to support an element on which the plaintiff bears the burden of proof. Id. at 290.

Discussion

¶ 13 Smelser and Zweifel do not argue that Westphal's complaint does not state a claim. Instead, they argue that the parties' submissions establish that there are no disputed issues of material fact and that Smelser and Zweifel are entitled to judgment as a matter of law on each of Westphal's claims. We agree.

Conspiracy to injure business reputation under WIS. STAT. § 134.01

¶ 14 Westphal claims that Smelser and Zweifel conspired to maliciously injure her business reputation in violation of WIS. STAT. § 134.01 (2005-06).¹ Specifically, Westphal contends that Smelser and Zweifel agreed to convey false and misleading information about Westphal's job performance to Evert, and that they did so to cause Evert to lose confidence in Westphal and fire her. They did this, Westphal argues, to detract attention from Smelser's poor managing of the program, as would soon be revealed in the Proxicom report, and to secure additional consulting work for Zweifel. Smelser and Zweifel argue that they are entitled to summary judgment on Westphal's claim for conspiracy under Wis. Stat. § 134.01 because the parties' submissions establish that the elements of the claim have not been met.² We agree with Smelser and Zweifel.

¶ 15 A claim for a conspiracy in violation of WIS. STAT. § 134.01 requires the plaintiff to establish that (1) the defendants acted together, (2) with a common purpose to injure the plaintiff's business, (3) with malice, and (4) the acts financially injured the plaintiff. WIS JI-CIVIL 2820 (2008). Additionally, "a plaintiff must show more than a mere suspicion or conjecture that there was a conspiracy or that there was evidence of the elements of a conspiracy." Maleki v. Fine-Lando Clinic Chartered, 162 Wis. 2d 73, 84, 469 N.W.2d 629 (1991). Thus, "if circumstantial evidence supports equal inferences of lawful and unlawful action, ... the claim of conspiracy ... is not proven.... [I]n such circumstances, the matter at issue should not be submitted to the jury." Id. at 85 (citations omitted). Because the parties' submissions do not support even an equal inference of the required element of malice, we conclude that Smelser and Zweifel are entitled to summary judgment.³ See id. at 86 ("There can be no conspiracy if malice is not found in respect to both conspirators.").

¶ 16 Malice in WIS. STAT. § 134.01 "does not merely mean an intent to harm, but means an intent to do a wrongful harm and injury. An intent to do a wrongful harm and injury is unlawful, and if a wrongful act is done to the detriment of the right of another, it is malicious." Maleki, 162 Wis. 2d at 87 (citation omitted). "[M]aliciously injuring [means] doing a harm malevolently for the sake of the harm as an end in itself, and not merely as a means to some further end legitimately desired." Id. at 87-88 (citation omitted). Westphal's claim of malice is that Smelser and Zweifel intended to harm her by conveying false and misleading information to Evert; that is, that Smelser and Zweifel knew Westphal was performing well and yet disparaged her to Evert in order to cause him to lose confidence in her. The record, however, does not support her claims.

¶ 17 In response to Westphal's claims, Zweifel submitted an affidavit stating that she accurately conveyed to Smelser and Evert the information she gathered in interviewing the program team members. She averred that Evert asked her whether she believed...