Court Opinion

ID: 2681250
Source: CourtListenerOpinion
Date Created: 2014-06-30 07:01:05.26264+00
Date Added: 2024-06-11T09:41:06.184515
License: Public Domain

UNPUBLISHED

                   UNITED STATES COURT OF APPEALS
                       FOR THE FOURTH CIRCUIT

                            No. 11-2327

JAMES M. DUNLAP,

                Plaintiff - Appellant,

           v.

COTTMAN TRANSMISSIONS SYSTEMS, LLC; TODD P. LEFF,

                Defendants - Appellees.

Appeal from the United States District Court for the Eastern
District of Virginia, at Norfolk. Arenda Wright Allen, District
Judge. (2:11-cv-00272-AWA-DEM)

Argued:   May 14, 2013                     Decided:   June 24, 2014

Before Sandra Day O’CONNOR, Associate Justice (Retired), Supreme
Court of the United States, sitting by designation, and WYNN and
DIAZ, Circuit Judges.

Vacated and remanded by unpublished per curiam opinion.

ARGUED:   Crystal M. Johnson, UNIVERSITY OF GEORGIA SCHOOL OF
LAW,   Appellate   Litigation   Clinic,  Athens,   Georgia,   for
Appellant. James C. Rubinger, PLAVE KOCH PLC, Reston, Virginia,
for Appellees.    ON BRIEF:   Peter B. Rutledge, Paula Briceno,
Brittany Cambre, UNIVERSITY OF GEORGIA SCHOOL OF LAW, Appellate
Litigation Clinic, Athens, Georgia, for Appellant.    Benjamin B.
Reed, PLAVE KOCH PLC, Reston, Virginia, for Appellees.

Unpublished opinions are not binding precedent in this circuit.
PER CURIAM:

        The background of this case is discussed in more detail in

our prior order.             See Dunlap v. Cottman Transmission Sys., LLC,

539 Fed. Appx. 69 (4th Cir. 2013).                    James Dunlap, the plaintiff-

appellant, has operated two AAMCO Transmissions, Inc. franchises

in Virginia for over 30 years.                      Cottman Transmission Systems,

LLC, the first defendant-appellee, is an AAMCO competitor.                                Todd

Leff,    the     second       defendant-appellee,          became    the    president       of

AAMCO when it was acquired by an asset-management company that

also held a large interest in Cottman.                             Dunlap alleges that

Cottman    and       Leff,    along    with    some    of    his    local    competitors,

including      Joseph        Truskowski       and   Robert    Biller,       conspired      to

force him out of business.                     He maintains that their actions

resulted    in       irreparable       harm    to   his    business    because       it    was

deprived       of     marketing       benefits      that    typically       flow   from     a

franchise       agreement.            Accordingly,        Dunlap’s     complaint      names

Cottman and Leff as defendants in a suit for: (1) violation of

Virginia’s       business         conspiracy    statute,      Va.    Code    §§ 18.2-499,

18.2-500,       (2)       tortious    interference         with     contract,      and     (3)

tortious interference with business expectancy.

        The district court dismissed Dunlap’s suit.                         With respect

to the statutory business conspiracy claim, it concluded that

Dunlap     had       failed    to     allege    a    valid    “unlawful       act”    as    a

predicate           for     the      conspiracy       because        neither       tortious

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interference     with       contract    nor    tortious         interference        with

business expectancy qualifies as such an act.                     And with respect

to the common law tortious interference claims, the district

court determined that they were untimely because Virginia’s two-

year statute of limitations for suits for personal injury, Va.

Code    § 8.01-243(A),       governs     them,     not    Virginia’s         five-year

statute of limitations for suits for injury to property rights,

Va. Code § 8.01-243(B).

       Recognizing that Dunlap’s challenge to the district court’s

decision turns on the correct interpretation of Virginia law, we

certified to the Supreme Court of Virginia, pursuant to its Rule

5:40, the following questions:

  1.    May a plaintiff use tortious interference with contract or

        tortious    interference        with   business        expectancy      as   the

        predicate     unlawful    act    for   a   claim       under   the    Virginia

        business conspiracy statute, Va. Code §§ 18.2-499, 18.2-

        500?

  2.    Does a two-year or five-year statute of limitations apply

        to   claims    of    tortious    interference          with    contract     and

        tortious interference with business expectancy under Va.

        Code § 8.01-243?

Dunlap, 539 Fed. Appx. at 70.

       The Supreme Court of Virginia accepted our certification

request and     answered      both   questions.          See    Dunlap   v.    Cottman

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Transmission Sys., LLC, 287 Va. 207 (2014).                   With respect to the

first    question,    it     “examine[d]      the    nature”       of   the       tortious

interference    with       contract     and     tortious       interference           with

business expectancy causes of action and determined that they

“are    intentional    torts    predicated      on    the    common        law    duty   to

refrain from interfering with another’s contractual and business

relationships.”       Id. at 216, 218.         Because “[t]hat duty does not

arise from the contract itself but is, instead, a common law

corollary of the contract,” the Court held that both causes of

action “qualify as the requisite unlawful act to proceed on a

business conspiracy claim under [Va.] Code §§ 18.2-499 and -

500.”    Id. at 211, 218.

       With respect to the second question, the Supreme Court of

Virginia    determined       that   “[t]he    dispositive          issue     is    whether

tortious    interference      with    contract       and   tortious         interference

with business expectancy allege injury to property.”                               Id. at

219.     Pointing to the requirement in both causes of action of

“intentional    interference         inducing       or     causing      a    breach      or

termination     of     the     contractual          relationship        or        business

expectancy,”    the    Court    reasoned      that       “[s]uch    interference         is

directed at and injures a property right, i.e., the right to

performance of a contract and to reap profits and benefits not

only from the contract but also from expected future contracts

or otherwise advantageous business relationships.”                          Id. at 221.

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Accordingly, it held that “the five-year statute of limitations

in   [Va.]     Code        § 8.01-243(B)         applies        to       both      tortious

interference       with     contract      and     tortious       interference            with

business expectancy.”           Id. at 222.

     In light of the Supreme Court of Virginia’s answers to the

certified questions, it is now clear that the district court’s

dismissal of Dunlap’s statutory business conspiracy and common

law tortious interference claims on the grounds stated in its

opinion is incorrect.

     Cottman and Leff, however, advance an additional ground for

affirming    the    district      court’s       dismissal     of     one     of    Dunlap’s

claims -- the statutory business conspiracy claim.                          They contend

that Dunlap cannot prevail on that claim because he alleges a

conspiracy between AAMCO, Cottman, and Leff, all of whom are

legally    incapable       of    conspiring       with    each       other      under      the

intracorporate      immunity       doctrine.          Since      we      may      affirm    a

district    court’s       dismissal    of   a    claim    “on      the     basis    of     any

ground supported by the record even if it is not the basis

relied upon by the district court,” Ostrzenski v. Seigel, 177
F.3d 245, 253 (4th Cir. 1999), we consider Cottman and Leff’s

contention here.

     The     intracorporate           immunity        doctrine           originates         in

antitrust law and holds that a corporation cannot, with certain

exceptions,        conspire        with         its      officers,           wholly-owned

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subsidiaries,      and    commonly-owned        affiliates.        See    Copperweld

Corp. v. Independence Tube Corp., 467 U.S. 752, 769, 771 (1984);

Advanced Health-Care Servs., Inc. v. Radford Cmty. Hosp., 910
F.2d 139, 146 (4th Cir. 1990).                 We need not decide whether the

doctrine applies to claims under Virginia’s business conspiracy

statute because Dunlap does not limit his conspiracy allegation

to AAMCO, Cottman, and Leff.           Rather, his complaint alleges that

Cottman     and   Leff    “along    with       AAMCO,    Truskowski      and    Biller

conspired with each other to injure Dunlap in his businesses.”

J.A.    20.       That    allegation       brings       the   claim   outside      the

intracorporate immunity doctrine because Truskowski and Biller,

Dunlap’s local competitors, lack the requisite relationship to

AAMCO, Cottman, and Leff.

       We     therefore    vacate      the       district       court’s        judgment

dismissing Dunlap’s suit and remand for further proceedings.

                                                              VACATED AND REMANDED

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