Opinion ID: 216819
Heading Depth: 3
Heading Rank: 2

Heading: Tortious Interference Under Kentucky Law

Text: Because the district court's jury instructions were based on Kentucky law, we first review the relevant state law on which the jury was instructed. Under Kentucky law, liability for tortious interference arises when a party improperly interferes with a valid expectancy of another. See Nat'l Collegiate Athletic Ass'n By and Through Bellarmine College v. Hornung, 754 S.W.2d 855, 857 (Ky.1988). In Hornung, the Kentucky Supreme Court first recognized the tort, expressly adopting §§ 766, 767 and 773 of the Restatement (Second) of Torts. Id. Section 766B sets forth the basic elements of a tortious interference claim: § 766B: Intentional Interference with Prospective Contractual Relation One who intentionally and improperly interferes with another's prospective contractual relation ... is subject to liability to the other for the pecuniary harm resulting from loss of the benefits of the relation, whether the interference consists of (a) inducing or otherwise causing a third person not to enter into or continue the prospective relation or (b) preventing the other from acquiring or continuing the prospective relation. Restatement (Second) of Torts § 766B (emphasis added). Section 767 elaborates on the element of improper interference set forth in § 766B: § 767. Factors In Determining Whether Interference Is Improper In determining whether an actor's conduct in intentionally interfering with a contract or a prospective contractual relation of another is improper or not, consideration is given to the following factors: (a) the nature of the actor's conduct, (b) the actor's motive, (c) the interests of the other with which the actor's conduct interferes, (d) the interests sought to be advanced by the actor, (e) the social interests in protecting the freedom of action of the actor and the contractual interests of the other, (f) the proximity or remoteness of the actor's conduct to the interference and (g) the relations between the parties. Id. § 767. Summarizing these factors, the Kentucky Supreme Court has held that improper interference under § 766B requires the plaintiff to `show malice or some significantly wrongful conduct.' Leo J. Brielmaier Co. v. Newport Hous. Auth., 173 F.3d 855 (6th Cir.1999) (table) (quoting Hornung, 754 S.W.2d at 859); Steelvest, Inc. v. Scansteel Serv. Ctr., Inc., 807 S.W.2d 476, 487 (Ky.1991) (defining unlawful means as including fraud, deceit, and coercion). In the case of a tortious interference claim between competitors, § 768 holds plaintiffs to a more exacting standard. Section 768 makes clear that competition is not an improper basis for interference, Restatement (Second) of Torts § 768, cmt. (a), and provides, in pertinent part: § 768. Competition As Proper or Improper Interference (1) One who intentionally causes a third person not to enter into a prospective contractual relation with another who is his competitor ... does not interfere improperly with the other's relation if (a) the relation concerns a matter involved in the competition between the actor and the other and (b) the actor does not employ wrongful means and (c) his action does not create or continue an unlawful restraint of trade and (d) his purpose is at least in part to advance his interest in competing with the other. Restatement (Second) of Torts § 768 (emphasis added). It is unclear whether the Kentucky Supreme Court would apply § 768, or how § 768 may otherwise impact the factors set forth in § 767.