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March 15 — A fired female sales representative for an animal medications firm can't hold her former supervisor liable under state law for inappropriate remarks that allegedly contributed to her discharge, the U.S. Court of Appeals for the Seventh Circuit ruled March 15.
Under Indiana law, an individual alleging tortious interference with a business relationship must show the defendant committed an illegal act while knowingly interfering with the plaintiff's business relationship without justification.
But fired Zoetis Inc. employee Kellie Pierce can't satisfy the tort's elements because the alleged defamation by Lois Heuchert, her former supervisor, doesn't qualify as “illegal conduct” under Indiana case law, the Seventh Circuit said.
Alternatively, Pierce argued that Heuchert's “loud” and “false” public statements about Pierce at a sales conference amounted to an “injurious falsehood” intended to harm her economic interests. But the court said even if injurious falsehood counts as illegal conduct for tortious interference purposes, Pierce failed to state a claim.
“There is simply nothing in [Pierce's] complaint that would support an inference that Pierce was financially harmed by Heuchert's statements or that her comment was intended to inflict pecuniary harm on Pierce,” Judge Ilana Diamond Rovner wrote.
The decision shows the difficulty for employees seeking to hold their supervisors liable for business torts. A boss acting within the scope of her duties generally is shielded from liability. And if a supervisor steps outside her assigned role, it can be difficult to prove hurtful comments, for example, caused an employee's economic loss.
Pierce began working for Zoetis in February 2012, and had several “unpleasant encounters” with Heuchert before she was fired in November 2013, the court recounted.
Early in 2013, Pierce complained to Zoetis's human resources department about Heuchert's behavior toward her, and the company investigated. In July 2013, the HR department told Pierce that its probe indicated Heuchert had behaved inappropriately and she would be disciplined.
But four months later, Zoetis fired Pierce for alleged poor performance, citing her inability to meet increased sales goals. Pierce alleged Heuchert had raised her sales quota as retaliation for her complaints.
A federal district court in Indiana dismissed Pierce's wrongful termination claims against Zoetis and Heuchert, as well as her tortious interference claim against Heuchert alone.
Pierce appealed only the dismissal of her tortious interference claim.
Pierce originally argued Heuchert interfered with her business relationship with Zoetis by “setting impossibly high sales quotas” and creating an environment that “allowed” for Pierce's termination.
But Heuchert's acts within the scope of her supervisory duties can't support a tortious interference claim, “which is intended primarily to prevent unjustified interference by third parties,” the Seventh Circuit said.
Pierce then focused on Heuchert's public comment during a sales meeting. When Pierce and a male colleague entered a room full of people gathered for a sales banquet, Heuchert loudly said, “What, are you two sleeping in the same room? You are always together!”
The comment certainly fell outside Heuchert's supervisory duties, the court said. But Pierce also must show Heuchert committed an illegal act while intending to harm Pierce's business relationship with Zoetis, the court said.
Defamation isn't “illegal conduct” for purposes of tortious interference, the court said.
“[E]ven if we assume that Heuchert's comment at the banquet was defamatory towards Pierce and that it interfered with some valid business relationship of Pierce's (a big assumption), her claim would still fail because Heuchert committed no illegal act,” the court said.
Pierce's alternative argument that Heuchert's statement was an “injurious falsehood” requires a showing the speaker intentionally harmed the victim's economic interests, the court said.
But nothing in Pierce's complaint suggests the evidence would show she suffered pecuniary loss as a result of Heuchert's comment, the court said.
“The comment itself is unrelated to Pierce's products, her sales, or anything that would bear on her business success selling animal medicines,” Rovner wrote.
More fundamentally, Heuchert's comment had no bearing on Zoetis's decision to fire Pierce, the court said. “There thus is no logical connection between the comment and any pecuniary harm Pierce did suffer,” the court said.
Even if Indiana courts might allow injurious falsehood to supply the required illegal act for a tortious interference claim, Pierce's claim still would fail because she can't show injurious falsehood, the court said.
“As bizarre and inappropriate as Heuchert's statements may have been, they are insufficient to supply the illegal act required for a tortious interference claim,” Rovner wrote.
Judges Diane P. Wood and Manish S. Shah joined in the decision.
Fixel & Nyehol PLLC represented Pierce. Jackson Lewis PC represented Zoetis and Heuchert.
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Text of the opinion is available at http://www.bloomberglaw.com/public/document/KELLIE_PIERCE_Plaintiff_Appellant_v_ZOETIS_INC_and_LOIS_HEUCHERT_.
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