Opinion ID: 1033212
Heading Depth: 2
Heading Rank: 1

Heading: ;:w:citN

Text: GCA. During the course of a financial audit for another gaming client, Krause obtained an intelligence bulletin authored by the Federal Bureau of Investigation (FBI) that contained information about alleged illegal acts committed by GCA and two members of its board of directors, appellants Robert Cucinotta and Karim Maskatiya. Due to the serious allegations in the intelligence bulletin, Deloitte's senior management and in-house counsel contacted the FBI and the Department of Justice (DOJ) to confirm the validity of the document. Although the DOJ advised against further dissemination of the document, Deloitte believed it had a duty under federal securities law to disclose the allegations within the intelligence bulletin to GCA's Audit Committee, which is a subcommittee of GCA's Board of Directors. Deloitte's in-house counsel prepared a script summarizing the allegations in the intelligence bulletin. Krause, along with a senior Deloitte auditor, subsequently communicated the allegations in the intelligence bulletin 2 to the Audit Committee via conference call. The script stated, in part, that Deloitte had learned from a credible, confidential source that serious allegations have been made regarding transactions and conduct involving Global Cash Access and its principals. Deloitte listed the allegations, all of which were serious in nature. Deloitte requested that the Audit Committee conduct an independent investigation. GCA issued a press release announcing that it would delay filing its third-quarter report pending the conclusion of an internal investigation. The investigation performed by a national law firm with 2A New York state court later ordered Deloitte to provide Cucinotta with a copy of the intelligence bulletin. SUPREME COURT OF NEVADA (0) I947A 3 experience in regulatory and compliance issues revealed no evidence of misconduct on the part of GCA, Cucinotta, or Maskatiya. GCA accepted the findings and issued a delayed third-quarter report. GCA's stock price significantly declined as a result of the delay in reporting. Soon thereafter, Cucinotta and Maskatiya resigned from GCA's Board of Directors. Subsequently, Cucinotta and Maskatiya filed a complaint for defamation and tortious interference against Deloitte and Krause. 3 They alleged that Deloitte published defamatory statements to the Audit Committee and knowingly interfered with their contractual relationships and prospective economic advantage with GCA as a result of the defamatory statements. Upon the completion of limited pre-answer discovery, Deloitte filed a motion for summary judgment, arguing that both the defamation and tortious interference claims failed as a matter of law because its communications with the Audit Committee were absolutely or conditionally privileged. The district court granted Deloitte's motion for summary judgment, concluding that Deloitte's communications to the Audit Committee were protected by a conditional privilege as Cucinotta and Maskatiya did not present evidence that would permit a reasonable jury to conclude that Deloitte acted with actual malice. The district court further concluded that Deloitte's communications were also privileged for purposes of the tortious interference claim. Although the district court found that Deloitte had a duty under federal securities law to disclose the allegations to the Audit Committee in order for the Audit 3 For the sake of clarity, we refer to respondents collectively as Deloitte. 4 Committee to investigate the allegations, the district court found it unnecessary to reach a conclusion as to whether Deloitte's statements were absolutely privileged. This appeal followed.