Opinion ID: 3018799
Heading Depth: 5
Heading Rank: 2

Heading: Civil Conspiracy to Breach Fiduciary Duties

Text: There might be a conflict of laws regarding the element necessary to prove a civil conspiracy for breach of fiduciary duties. In large part, this conflict depends on how one believes a Texas court would apply Texas civil conspiracy law to Texas’s limited requirements for breach of fiduciary duty when disgorgement is sought. Texas requires both a conspiracy and a breach of fiduciary duty to maintain a claim of civil conspiracy to breach fiduciary duties. Finish Line P’ship. v. Kasmir & Krage, L.L.P., 2000 Tex. App. LEXIS 7744 (Tex. App. 2000). Therefore, Plaintiffs cannot proceed on their civil conspiracy claim under Texas law unless they can also proceed on their breach of fiduciary duty claim, as discussed above. 16 We note that under Pennsylvania choice of law rules’ “significant relationship” analysis, among Pennsylvania, Ohio, and Indiana, there is not a state with a superior relationship to this case. Therefore, if Texas law did not apply, we would still have to determine if there was a conflict among these states’ laws and that seeking certification from three separate state supreme courts, including two that are not within our Circuit, could significantly delay resolution of this case. 25 Texas generally requires actual injury for civil conspiracy claims, Chon Tri v. J.T.T., 162 S.W.3d 552, 556 (Tex. 2005). However, in light of the absence of an injury requirement for breach of fiduciary duty and Texas’ definition of civil conspiracy as “a combination by two or more persons to accomplish an unlawful purpose or to accomplish a lawful purpose by unlawful means,” Triplex Commc’ns v. Riley, 900 S.W.2d 716, 720 (Tex. 1995), we think it an open question whether Texas law requires actual harm for a claim of civil conspiracy to breach fiduciary duty. Pennsylvania law appears to require injury for a civil conspiracy. Goldstein v. Phillip Morris, Inc., 854 A.2d 585, 590 (Pa. Super. Ct. 2004) (listing injury as a necessary element), but cf. Grose v. P&G Paper Prods. (In re Grose), 866 A.2d 437, 440-441 (Pa. Super. Ct. 2005) (not listing injury as a necessary element although injury existed). Ohio requires proof of an underlying claim and actual damages in a claim for civil conspiracy. Williams v. Aetna Fin. Co., 700 N.E.2d 859, 868 (Ohio 1998). Indiana also requires harm for a civil conspiracy. Indianapolis Horse Patrol, Inc. v. Ward, 247 Ind. 519, 522 (Ind. 1966); Winkler v. V.G. Reed & Sons, 638 N.E.2d 1228, 1234 (Ind. 1994). As noted above, though, these states have not addressed the unique situation of a claim for disgorgement for breach of fiduciary duties. This is an area of unsettled law, but we believe it a fair presumption that civil conspiracy to breach fiduciary duties will follow the law for breach of fiduciary duties, so, as explained above, we will presume a conflict of laws on the civil conspiracy claim too.