Others First, Inc. v. Better Business Bureau , 829 F.3d 576 ( 2016 )

United States Court of Appeals
For the Eighth Circuit
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No. 15-2184
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Others First, Inc.
lllllllllllllllllllll Plaintiff - Appellant
Better Business Bureau of Greater St. Louis, Inc.
lllllllllllllllllllll Defendant - Appellee
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Appeal from United States District Court
for the Eastern District of Missouri - St. Louis
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Submitted: January 14, 2016
Filed: July 12, 2016
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Before LOKEN, GRUENDER, and KELLY, Circuit Judges.
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LOKEN, Circuit Judge.
In August 2011, the Better Business Bureau of Greater St. Louis (“the BBB”)
published a news release (“the Release”) expressing concern about Others First, Inc.
(“Others First”), a Michigan-based charity that had recently begun soliciting vehicle
donations in the St. Louis area. A copy of the Release is attached as Appendix A to
this opinion. In June 2014, Others First filed this diversity action in the Eastern
District of Missouri, asserting tort claims for injurious falsehood, based on alleged
falsehoods contained in the Release, and for interference with business expectancy,
based on allegations that the BBB published the Release to direct car donations to a
competing BBB member, took actions to keep the Release on the first page of Google
search results for the search term “Others First,” and induced a Kansas City television
station to run a story in November 2014 based on the Release.
The BBB filed motions to dismiss and for summary judgment. The district
court1 granted summary judgment in favor of the BBB, concluding that the Release
was not actionable injurious falsehood because “no reasonable factfinder could ever
find that the BBB stated anything other than the truth and its seemingly well-informed
opinions about Others First,” and that the tortious interference claim necessarily failed
because the Release contained no wrongful defamation. Others First appeals, arguing
that both claims should have survived summary judgment because the record
contained sufficient evidence to raise genuine issues of disputed fact.2 Reviewing the
grant of summary judgment de novo and viewing the facts in the light most favorable
to the non-moving party, Others First, we affirm. See Mercer v. City of Cedar Rapids,
308 F.3d 840, 843 (8th Cir. 2002) (standard of review).
I. The Tortious Interference Claim.
Others First’s principal argument on appeal is that the district court erred in
concluding that the tortious interference claim necessarily fails because the Release
contained no actionable injurious falsehood. Under Missouri law, “[t]ortious
interference with a contract or business expectancy requires proof of: (1) a contract
or valid business expectancy; (2) defendant’s knowledge of the contract or
1
The Honorable Rodney W. Sippel, Chief United States District Judge for the
Eastern District of Missouri.
2
Others First argued to the district court that summary judgment was premature
because it had not conducted discovery, but it did not file a motion seeking additional
time to conduct discovery. See Fed. R. Civ. P. 56(d).
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relationship; (3) a breach induced or caused by defendant’s intentional interference;
(4) absence of justification; and (5) damages.” Nazeri v. Mo. Valley Coll., 860
S.W.2d 303, 316 (Mo. banc 1993). To show an absence of justification, Others First
has the burden of producing sufficient evidence to show that the BBB employed
improper means to further its own interests. “[I]mproper means are those that are
independently wrongful, such as . . . defamation, misrepresentation of fact, . . . or any
other wrongful action recognized by statute or the common law. Conversely, no
liability arises if the defendant had an unqualified legal right to do the act complained
of.” Id. at 317 (citation omitted).
“[W]here a tortious interference claim is based upon an alleged defamation, if
a plaintiff’s defamation claim fails, the tortious interference claim must also fail
because the plaintiff cannot establish an absence of justification as a matter of law.”
Castle Rock Remodeling, LLC v. Better Bus. Bureau of Greater St. Louis, 354 S.W.3d
234, 245 (Mo. App. 2011); see Milkovich v. Lorain Journal Co., 497 U.S. 1, 18-20
(1990). We reject Others First’s contention that the record contains no evidence
supporting the BBB’s legitimate interest in warning consumers of questionable
business practices. If record evidence was needed, Others First itself provided the
BBB’s published Mission Statement in its summary judgment responsive exhibits.
Thus, if the Release contained no actionable injurious falsehood -- the issue we will
discuss in Part II -- Others First needed to submit sufficient evidence of some other
independently wrongful action to avoid summary judgment dismissing its tortious
interference claim.
Others First argues that it submitted sufficient evidence of three independently
wrongful acts: the BBB (1) published the Release “to help a BBB member . . . obtain
an unfair and illegal competitive advantage over Others First”; (2) republished the
Release to keep it at the top of Google search engine results; and (3) induced or
assisted a Kansas City television station to run the November 2014 story based on the
Release. Assuming without deciding that sufficient evidence supporting these
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allegations of wrongful motive and actions would defeat a defamation defendant’s
motion for summary judgment, the record contains no evidence supporting these
allegations, other than their assertion in the First Amended Complaint, and
declarations by an officer and a contracting agent stating that the assertions are what
Others First believes to be true. “Mere opinion fails to raise any issue of material fact
that precludes summary judgment.” Rice v. Hodapp, 919 S.W.2d 240, 244 (Mo. banc
1996); see Castle Rock, 354 S.W.3d at 245-46. Therefore, Others First failed to prove
the BBB employed any other improper means, and the district court properly granted
summary judgment on this claim if the Release was not defamatory.
II. The Injurious Falsehood Claim.
Under Missouri law, although defamation and injurious falsehood are distinct
torts, for a statement to be actionable as injurious falsehood it must be defamatory.
See Diehl v. Kintz, 162 S.W.3d 152, 155-56 & n.4 (Mo. App. 2005). “[O]ne who
publishes a false statement harmful to the interests of another is subject to liability for
pecuniary loss resulting to the other” if:
(a) he intends for publication of the statement to result in harm to
interests of the other having a pecuniary value, or either recognizes or
should recognize that it is likely to do so, and (b) he knows that the
statement is false or acts in reckless disregard of its truth or falsity.
Wandersee v. BP Prods. N. Am., Inc., 263 S.W.3d 623, 628 (Mo. banc 2008)
(quotation and emphases omitted). To determine if the statement is defamatory, the
challenged words “must be stripped of any pleaded innuendo and construed in their
most innocent sense,” but at the same time “must be considered in context, giving
them their plain and ordinarily understood meaning.” Nazeri, 860 S.W.2d at 311
(citations omitted).
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If a statement is true, it is not defamatory as a matter of law. Rice, 919 S.W.2d
at 243-44. Statements of opinion are protected by the First Amendment, and, even if
made maliciously or insincerely, cannot be actionable. See Hammer v. City of Osage
Beach, 318 F.3d 832, 842 (8th Cir. 2003) (applying Missouri law). Whether a
statement is a protected opinion is also a question of law. The court must look to “the
totality of the circumstances to determine whether the ordinary reader would have
interpreted the statement as an opinion.” Id. at 842-43 (quotation omitted). However,
the First Amendment “privilege does not apply when the statement of opinion implies
the existence of undisclosed defamatory facts.” The question for the court is “whether
a reasonable factfinder could conclude that the statement [of opinion] implies an
assertion of objective fact.” Castle Rock, 354 S.W.3d at 241 (quotation omitted).
Others First failed to plead alleged defamatory statements with the particularity
required by Missouri law. However, the district court denied the BBB’s motion to
dismiss because Others First’s response in opposition to summary judgment alleged
that eight specific statements in the Release were defamatory as a matter of law. Like
the district court, we will limit our analysis to those eight statements.
1. “BBB Urges Caution On Others First Car Donation Programs.” Others
First solicits car donations nationwide, operating under various names including Cars
Helping Veterans, Cars Fighting Cancer, and Mikie’s Minutes. The BBB began
investigating Others First in March 2011 when it began soliciting car donations in the
St. Louis area under the name Cars Helping Veterans. The Release suggested caution
because of possible ties between Others First and Rick Frazier, who was the subject
of prior complaints for his work with vehicle donation programs in other States.
Urging caution was an expression of the BBB’s opinion because it was “a subjective
assessment and not an objectively verifiable fact.” Castle Rock, 354 S.W.3d at 242.
Therefore, we consider whether the “opinion implie[d] the existence of undisclosed
defamatory facts.” Id. at 241. Reading this statement in the context of the Release as
a whole, we conclude that the truthful facts in the Release were sufficient to support
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the cautionary opinion without implying any other facts. Thus, it was protected
opinion and not defamatory as a matter of law. See Hammer, 318 F.3d at 842. Others
First argues the BBB could not have “republished” the Release on the internet for four
years solely to “caution” consumers. But it submitted no evidence to support this
speculative, counterintuitive assertion.
2. “The BBB advises caution when dealing with Rick Frazier and the charity
Others First. Others First is a two-year-old nonprofit that raises money for causes,
such as disabled and homeless veterans, cancer research, children and animals. In
recent months, Others First has mailed solicitations to St. Louis area consumers on
behalf of an affiliated charity, Cars Helping Veterans.” Like statement 1, this
statement urging caution was a protected opinion. The facts set forth are undisputed.
3. “A national charity that is seeking car donations in the St. Louis area has
ties to a Detroit area businessman who has been criticized for alleged improprieties
in running similar programs, the [BBB] warns.” In support of its motion for
summary judgment, the BBB submitted a December 1998 article from the Detroit
Free Press stating that Charity Motors, “the largest of metro Detroit’s used-car
donation programs,” gave less than 40% of its money to charity last year and paid its
“founder,” Rick Frazier, “a huge sum . . . drawing sharp criticism from [the] Michigan
Attorney General”; and that Frazier had previously been sued by Mother Waddles
Perpetual Mission for allegedly withholding money he earned by running the
Mission’s vehicle donation program. The BBB also submitted documentary evidence
establishing that (i) in 2010, Others First entered into consulting agreements with
Charity Funding Consulting Group, Inc., a for-profit corporation formed and owned
by Frazier, and with Charity Car Brokers, LLC, a corporation formed by Maurice
Banks, former Treasurer of Others First, to administer and manage Others First’s
vehicle donation program; (ii) Banks and Frazier were also involved with a venture
called Charity Tickets, Inc.; (iii) some sources listed Frazier as the founder of Others
First, alough Frazier denied being the founder and David Kennedy, President of
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Others First, stated that Frazier had never been a director or officer of Others First in
a letter the BBB quoted in the Release; and (iv) Frazier had filed a lawsuit against the
Military Order of the Purple Heart Service Foundation relating to his contracts to run
its car donation charities, and the Foundation filed a counterclaim alleging that Frazier
misappropriated funds and breached the contracts.
Others First argues that it had no “ties” to Frazier because Frazier was not the
founder of Others First. Considering the statement in context and giving the words
their ordinary meaning, a reader would construe “ties” more broadly than Others First.
Frazier’s undisputed “tie” to Others First was a contract to run its vehicle donation
program for a percentage of the profits. It was also true that Frazier was “criticized
for alleged improprieties” in the Detroit Free Press article and the Foundation
countersuit. Thus, stripped of pleaded innuendo, statement 3 was factual and not
defamatory. See Nazeri, 860 S.W.2d at 311.
4. “Michelle L. Corey, BBB President and CEO, said the BBB is concerned
about Frazier’s controversial history with other charitable vehicle donation
programs. ‘Mr. Frazier’s past problems are reason to be cautious about his newest
venture,’ she said.” This statement was Corey’s opinion, another expression of
caution like the protected opinion in statements 1 and 2. There was nothing in
Corey’s opinion to suggest an implicit defamatory fact. The Release provided the
context for her opinion, including details of Frazier’s “controversial history.” Others
First argues the phrase “newest venture” falsely implied that Frazier founded Others
First. But the plain meaning of “newest venture” is not so limited. Frazier
unquestionably joined in a business venture with Others First by agreeing to manage
its vehicle donation program. The statement was not defamatory as a matter of law.
5. “Corey also said it appears that a former associate of Frazier, and perhaps
even Frazier himself, may have potential conflicts of interest over their involvement
in the Others First donation program.” Alleging a conflict of interest is not
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defamatory unless it implies undisclosed defamatory facts. See Pape v. Reither, 918
S.W.2d 376, 381 (Mo. App. 1996) (allegations of illegal conduct are non-defamatory
opinions); Koly v. Enney, 269 F. App’x 861, 865 (11th Cir. 2008) (classifying
conduct as “a serious conflict of interest” was protected opinion). The statement was
presented as opinion, couched in equivocal language -- “appears,” “perhaps,” “may,”
and “potential.” See Ribaudo v. Bauer, 982 S.W.2d 701, 705 (Mo. App. 1998)
(“[T]he average reader would have believed the statements were opinion” because of
their “qualifying language.”) The Detroit Free Press article provided a basis for
Corey’s “conflict of interest” opinion, reporting that “charity officials are prohibited
by federal law from deriving unreasonable personal gain from their involvement with
their charity.” Statement 5 was non-defamatory opinion as a matter of law.
6. “Frazier is described in the media and on the website of an Others First
charity as the charity’s founder, although he denies that role. Banks is the previous
treasurer of Others First.” This statement is non-actionable as a matter of law
because it was true, whether or not Frazier was in fact Other First’s founder. The
BBB included Other First’s response in the Release: “Kennedy . . . said in a letter to
the BBB that Frazier has never been a board member or officer of Others First and any
reference to him as founder is ‘unauthorized and misguided.’”
7. “Frazier’s problems in the charity arena have been the subject of news
reports. The Detroit Free Press reported in 1998 that the Mother Waddles Perpetual
Mission charity in Detroit accused Frazier of several improprieties in that donation
program. The newspaper also raised questions about Frazier’s involvement with the
Charity Motors donation program in Detroit.”
8. “Last year, the Virginia-based Military Order of the Purple Heart
Foundation alleged in a court suit that an audit found widespread problems with
Frazier’s role in that program, including self-dealing, illegal practices and
destruction of incriminating records.” Others First does not contest the fact that the
Detroit Free Press wrote articles critical of Frazier and that the Foundation made
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allegations in a countersuit. The Release noted that “Frazier denied the claims.”
These statements were non-defamatory because the facts stated were true.
Others First argues that “[n]o materials are provided to the reader to assess the
veracity” of the statements in the Release. However, there is no requirement that
readers be provided source materials for non-defamatory speech to be protected.
Hammer, 318 F.3d at 843. The district court properly granted summary judgment
dismissing Other First’s claim of injurious falsehood because all of the challenged
statements were either true statements of fact or protected opinion, and properly
granted summary judgment dismissing the tortious interference claim given the
absence of wrongful defamation.
The judgment of the district court is affirmed.
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Appendix A