Opinion ID: 1748299
Heading Depth: 1
Heading Rank: 4

Heading: Intentional Interference with Existing and Prospective Contractual Relations

Text: The jockeys also claim RACI tortiously interfered with existing and prospective riding contracts the jockeys had with horse-owners and trainers. The district court granted summary judgment to RACI on both claims. On appeal, the jockeys abandoned the claim of prospective contractual relations, and we consequently only consider the claim of interference with existing contracts. The elements of the tort of intentional interference with an existing contract are: `(1) plaintiff had a contract with a third-party; (2) defendant knew of the contract; (3) defendant intentionally and improperly interfered with the contract; (4) the interference caused the third-party not to perform, or made performance more burdensome or expensive; and (5) damage to the plaintiff resulted.' Gibson v. ITT Hartford Ins. Co., 621 N.W.2d 388, 399 (Iowa 2001) (quoting Jones v. Lake Park Care Ctr., Inc., 569 N.W.2d 369, 377 (Iowa 1997)). RACI conceded for purposes of summary judgment that the jockeys had contractual relationships with horse-owners and trainers, and RACI did not dispute that it knew of the relationships. Rather, RACI claimed it was entitled to summary judgment because there were no facts pertaining to the claim to establish the third element: intentional and improper interference. Thus, the crux of the argument on appeal boils down to whether there are any facts associated with the jockeys' claim from which a rational jury could find intentional and improper interference. Wilson v. Darr, 553 N.W.2d 579, 582 (Iowa 1996) ([T]he moving party may establish a right to summary judgment by establishing the limits of the other part[y's] proof. If those limits reveal that the resisting party has no evidence to factually support an outcome determinative element of that party's claim, the moving party will prevail on summary judgment. (citing Griglione v. Martin, 525 N.W.2d 810, 813-14 (Iowa 1994))); accord Mason v. Vision Iowa Bd., 700 N.W.2d 349, 353 (Iowa 2005) (stating that to generate a genuine issue of material fact, the nonmoving party must present some evidence from which a reasonable fact-finder could find in that party's favor). The intent to interfere with a contract does not make the interference improper. Berger v. Cas' Feed Store, Inc., 543 N.W.2d 597, 599 (Iowa 1996) (citing Restatement (Second) of Torts § 767 cmt. d (1979)). The interference must be both intentional and improper. For purposes of a claim for intentional interference with a contract, the factors used to help determine if the challenged conduct was improper include: 1. The nature of the conduct. 2. The Defendant's motive. 3. The interests of the party with which the conduct interferes. 4. The interest sought to be advanced by the Defendant. 5. The social interests in protecting the freedom of action of the Defendant and the contractual interests of the other party. 6. The nearness or remoteness of the Defendant's conduct to the interference. 7. The relations between the parties. Revere Transducers, Inc. v. Deere & Co., 595 N.W.2d 751, 767 (Iowa 1999); accord Restatement (Second) of Torts § 767, at 26-27. In Berger, we quoted from Restatement (Second) of Torts section 767 comment d: [I]f there is no desire at all to accomplish the interference and it is brought about only as a necessary consequence of the conduct of the actor engaged in for an entirely different purpose, his knowledge of this makes the interference intentional, but the factor or motive carries little weight towards producing any determination that the interference was improper. Berger, 543 N.W.2d at 599 (quoting Restatement (Second) of Contracts § 767 cmt. d ). Thus, conduct is generally not improper if it was merely a consequence of actions taken for a purpose other than to interfere with a contract. See id. ([A] party does not improperly interfere with another's contract by exercising its own legal rights in protection of its own financial interests. (citing Wilkin Elevator v. Bennett State Bank, 522 N.W.2d 57, 62 (Iowa 1994))). In this case, RACI supported its motion for summary judgment with evidence that the only reason it acted to exclude the jockeys from the track was to responsibly respond to the allegations that the jockeys racially harassed the jockey room custodian. It contends this undisputed fact means that if its conduct did interfere with the jockeys' riding contracts, the interference was not improper but only a consequence of actions taken for the purpose of satisfying its obligation under the law as an employer. See Farmland Foods, Inc. v. Dubuque Human Rights Comm'n, 672 N.W.2d 733, 744 (Iowa 2003) (noting that an employer's failure to take proper remedial action in response to harassment by a nonsupervisory employee is an essential element of a hostile-work-environment claim under the civil rights acts); see also Taylor v. Jones, 653 F.2d 1193, 1199 (8th Cir.1981) ([E]mployer toleration of a discriminatory atmosphere alone gives rise to a cause of action by the [employee].). We recognize a legitimate need of an employer to investigate the allegations of harassment in the workplace and, based upon the results of an investigation, to take responsible action against employees who harass other employees. See Taylor, 653 F.2d at 1199; Farmland Foods, Inc., 672 N.W.2d at 744. Thus, we agree with RACI that if the evidence in this case only shows it acted for the purpose of satisfying its legal obligation to protect the interests of employees and to maintain a hostility-free work environment, then there can be no viable claim for interference with a contract. The factors used to determine the existence of improper conduct support this conclusion. See Revere Transducers, Inc., 595 N.W.2d at 767 (listing factors). If the sole motive is a legitimate purpose derived from the law, then any interference is not improper as a matter of law. See Berger, 543 N.W.2d at 599 ([A] party does not improperly interfere with another's contract by exercising its own legal rights in protection of its own financial interests. (Citation omitted.)). See generally Restatement (Second) of Torts § 767 cmt. b, at 28 (The rules stated in §§ 768-774 show[ ] the results of the balancing process in some specific situations that have been the subject of judicial decision; but they do not constitute an exhaustive list of situations in which it has been determined that an intentional interference with contractual relations is not improper.). When a motion for summary judgment is properly supported, the nonmoving party is required to respond with specific facts that show a genuine issue for trial. See Hlubek v. Pelecky, 701 N.W.2d 93, 95-96 (Iowa 2005) ([T]he nonmoving party may not rest upon the mere allegations of his pleading but must set forth specific facts showing the existence of a genuine issue for trial. (citing Iowa R. Civ. P. 1.981(5); Hoefer v. Wis. Educ. Ass'n Ins. Trust, 470 N.W.2d 336, 338-39 (Iowa 1991))). This means the jockeys in this case were required to set forth some facts in resisting RACI's motion for summary judgment that could support the existence of an improper motive. The jockeys failed to point to any facts in resisting the motion for summary judgment to show RACI's motive was improper. In fact, they offered no facts bearing on the issue of motive in resisting the summary judgment motion, but only made conclusory allegations that RACI's actions were improper. Moreover, the jockeys did not remedy this deficiency when they provided the trial judge with a copy of the complete temporary-injunction record at the summary judgment hearing. Our rules require a nonmoving party to identify the specific facts that show the existence of a genuine issue for trial. Iowa R. Civ. P. 1.981(5). When, as in this case, a party resisting summary judgment seeks to generate a fact issue on an actor's motive, that party must identify specific facts that reveal the alleged underlying motive. See Hoefer, 470 N.W.2d at 338-39 (While intentional torts . . . are generally poor candidates for summary judgment because of the subjective nature of motive and intent the rule is not absolute and, . . . `there is no genuine issue of fact if there is no evidence.' Put another way, the party resisting summary judgment `may not rest upon the mere allegations or denials of his pleading.' The resistance must set forth specific facts constituting competent evidence to support a prima facie claim. (Citations omitted.)). Notwithstanding, the jockeys argue that an inference of an improper motive can be drawn from the undisputed facts offered by RACI in its motion for summary judgment. They claim RACI's threat to arrest the jockeys and the severity of the RACI's responsive action, as well as RACI's decision to pursue an independent investigation following the stewards' investigation, all support an inference of an improper motive. We recognize that a nonmoving party is entitled to all reasonable inferences in a motion for summary judgment. See Perkins v. Wal-Mart Stores, Inc., 525 N.W.2d 817, 818 (Iowa 1994) ([S]ummary judgment is like a directed verdict: Every legitimate inference that reasonably can be deduced from the evidence should be given to the nonmoving party.). However, the requirement to identify specific facts in response to a summary judgment motion includes the requirement to identify those facts that support the inference sought to be drawn. The jockeys have not done so.