Chapter 6
INTENTIONAL TORTS & BUSINESS
TORTS
1
Suggested Additional Assignments
Research: Criticism by the Press
Ask students to find a newspaper article, editorial, or column that harshly criticizes someone. Has the
author or publisher made efforts to avoid a claim of libel? How?
Research: Online Defamation
Ask students to find an on-line posting either on a social networking site or celebrity gossip site that
Research: Tortious Interference
In the financial pages of a newspaper, students should find an article about two corporations negotiating a
Chapter Overview
Chapter Theme
A wide variety of intended acts can have unintended consequences. With intentional torts, the defendant
may not have intended to harm the plaintiff, but her deliberate actions have resulted in alleged injury.
Anticipating the harm that can result enables us to consider carefully the actions themselves.
Quotes of the Day
“If thou dost marry, I’ll give thee this plague for thy dowry: be thou as chaste as ice, as pure as snow, thou
Introduction
“Tort” means “wrong.” A tort is a violation of a duty imposed by the civil law. Torts differ from crimes
Intentional Torts
Defamation
Four elements: Defamatory statement, that is false, communicated to someone other than the plaintiff,
that somehow injures the plaintiff. Mere statement of opinion does not constitute defamation.
2 Unit 1 The Legal Environment
Additional Case: You Be the Judge: Yeagle v. Collegiate Times1
Facts: Sharon Yeagle was the Assistant to the Vice President of Students Affairs and Virginia
Polytechnic Institute and State University. One of Yeagle’s duties was to help students apply to the
Issue: Was the phrase defamatory, or was it deliberate exaggeration that no reasonable person would
take literally?
Holding: Judgment for Collegiate Times affirmed. The court held that the phrase was no more than
rhetorical hyperbole. Although the phrase was disgusting, offensive, and in bad taste, it could not
reasonably be understood as stating an actual fact about Yeagle’s job title or her conduct, or that she
committed a crime of moral turpitude. Yeagle’s assertion that the phrase demonstrated a lack of integrity
in the performance of her duties also failed. The phrase could not reasonably be considered as conveying
factual information about Yeagle, thus it did not support a cause of action for defamation.
Question: Why didn’t the district court allow Yeagle to present her case at trial? Wasn’t she entitled
to his day in court?
Answer: Yeagle had her day in court—before the judge who dismissed her case. A plaintiff only
Question: Why does the court look at phrase in the context in which it appeared, from the standpoint
of the average reader?
Answer: The phrase could not be read in a vacuum. The same phrase appearing on the front page of
Question: What was the context in which they appeared?
Answer: They were in a student newspaper, readers of which appreciate humor and lively language
In this context, a reader viewing the phrase would not interpret it as literal statements of fact.
Question: Why is that important? The photo and caption offended Yeagle.
Public Personalities
In New York Times v. Sullivan2 the Supreme Court raised the bar for public personalities who sue for
defamation requiring, in addition to the normal prima facie case, proof that the defendant acted with
actual malice. The Supreme Court decided this case in 1964—before the birth of People magazine and its
General Questions:
Should the law continue to require all public personalities to prove actual malice? Why or why not?
Should a court consider the value to society of the communication involved before requiring a public
personality to prove actual malice? If so, how should the court measure such value?
1 255 Va. 293, 497 S.E.2d 136, 1998 Va. LEXIS 32, Virginia Supreme Court, 1998
2 376 U.S. 254, 84 S. Ct. 710, 1964 U.S. LEXIS 1655 United States Supreme Court, 1964
Chapter 6 Intentional Torts and Business Torts 3
How would one revise the actual malice test to continue to serve the First Amendment principles the
Court designed it to protect?
Privilege
False Imprisonment
The intentional restraint of another person without a reasonable cause and without consent is false
Intentional Infliction of Emotional Distress
Case: Jane Doe and Nancy Roe v. Lynn Mills3
Facts: Late one night, an anti-abortion protestor named Robert Thomas climbed into a dumpster located
behind the Women’s Advisory Center, an abortion clinic. He found documents indicating that the
plaintiffs were soon to have abortions at the clinic. Thomas gave the information to Lynn Mills. The
next day, Mills and Sister Lois Mitoraj created signs, using the women’s names, indicating that they were
about to undergo abortions, and urging them not to “kill their babies.”
Doe and Roe (not their real names) sued, claiming intentional infliction of emotional distress (as well as
breach of privacy, discussed later in this chapter). The trial court dismissed the lawsuit, ruling that the
defendants’ conduct was not extreme and outrageous. The plaintiffs appealed.
Issue: Have the plaintiffs made a valid claim of intentional infliction of emotional distress?
Question: What are the elements of intentional infliction of emotional distress?
Answer: A plaintiff must prove extreme and outrageous conduct that caused her serious emotional
harm.
Question: According to the appeals court, how does the law determine whether a defendant’s
conduct is sufficiently extreme to constitute this tort?
Question: Don’t the defendants have a First Amendment right to express their opinions?
Question: Then how can the appeals court reverse the trial court’s dismissal? Isn’t the court
diminishing the defendants’ First Amendment rights?
Answer: The court acknowledges that the defendants have a right to express their views on abortion.
Question: Does the appeals court ruling mean that the plaintiffs have proven their case of intentional
infliction of emotional distress?
3 212 Mich. App. 73, 536 N.W.2d 824, 1995 Mich. App. LEXIS 313 Michigan Court of Appeals, 1995
4 Unit 1 The Legal Environment
Answer: No. The ruling simply means that the plaintiffs are entitled to a jury trial. The court is
Additional Intentional Torts
Battery and Assault
Assault and battery are related, but not identical. Battery is an intentional touching of another person in a
way that is harmful or offensive. Assault occurs when a defendant does some act that makes a plaintiff
fear an imminent battery.
Trespass, Conversion, and Fraud
Trespass is intentionally entering land that belongs to someone else or remaining on the land after being
asked to leave. You don’t have to be aware that the land belongs to someone else. It is also trespass if
you have some object, let’s say a car, on someone else’s property and refuse to remove it.
Conversion is taking or using someone’s personal property without consent.
Fraud is injuring another person by deliberate deception.
Damages
Landmark Case: State Farm v. Campbell4
Facts: While attempting to pass several cars on a two-lane road, Campbell drove into oncoming traffic.
An innocent driver swerved to avoid Campbell and died in a collision with a third driver. The family of
the deceased driver and the surviving third driver both sued Campbell.
As Campbell’s insurer, State Farm represented him in the lawsuit. It turned down an offer to settle the
His lawyers presented evidence that State Farm had deliberately acted in its own best interests rather
than his. The jury was convinced, and in the end, Campbell won an award of $1 million in compensatory
damages, and $145 million in punitive damages. State Farm appealed.
Issue: What is the limit on punitive damages?
Excerpts from Justice Kennedy’s Opinion: We address whether an award of $145 million in punitive
4 538 U.S. 408 Supreme Court of the United States (2003)
Chapter 6 Intentional Torts and Business Torts 5
conduct that will subject him to punishment, but also of the severity of the penalty that a State may
impose. To the extent an award is grossly excessive, it furthers no legitimate purpose and constitutes an
arbitrary deprivation of property. A defendant should be punished for the conduct that harmed the
plaintiff, not for being an unsavory.
Nonetheless, because there are no rigid benchmarks that a punitive damages award may not surpass,
ratios greater than those we have previously upheld may comport with due process where a particularly
egregious act has resulted in only a small amount of economic damages. The precise award in any case
must be based upon the facts and circumstances of the defendant’s conduct and the harm to the plaintiff.
In sum, courts must ensure that the measure of punishment is both reasonable and proportionate to the
The judgment of the Utah Supreme Court is reversed, and the case is remanded for proceedings not
inconsistent with this opinion.
Question: What is the limit on punitive damages?
Question: Why do you think Campbell’s lawyers asked for such a high amount in punitive damages?
Answer: To send a message to State Farm, and all insurance companies, that in the context of legal
Additional Case: Exxon Shipping Co. et al. v. Baker et al.5
Facts: In 1989, the Exxon supertanker Valdez ran aground on a reef in Alaska spilling 11 million gallons
of crude oil into Prince William Sound. The captain of the Valdez, John Hazelwood had completed a 28–
day alcohol treatment program while employed by Exxon, as his superiors knew, but dropped out of the
required follow-up program and stopped attending Alcoholics Anonymous meetings. Witnesses testified
that before the Valdez left port on the night of the spill, Hazelwood drank at least five double vodkas,
which is about 15 ounces of 80-proof alcohol, enough “that a non–alcoholic would have passed out.”
5 128 S.Ct. 2605 (2008).
6 Unit 1 The Legal Environment
and agreed to pay a $150 million fine, which was later reduced to $25 million plus restitution of $100
million. A civil action by the United States and the state of Alaska resulted in a consent decree whereby
Exxon will pay $900 million toward restoring natural resources, and Exxon paid another $300 million in
voluntary settlements with fishermen, property owners, and other private parties.
The remaining civil cases were consolidated and a class of plaintiffs sought punitive damages. Exxon
admitted it was negligent in the disaster and liable for compensatory damages. In charging the jury on the
adjustments and reduced the award to $2.5 billion. Exxon appealed to the United States Supreme Court.6
Issue: Was the punitive damage award excessive?
Holding: Yes, the decision of the Court of Appeals is vacated and remanded.
Excerpts from Justice Souter’s Opinion: Exxon argues that the $2.5 billion punitive damage award
exceeds the bounds justified by the punitive damages goal of deterring reckless (or worse) conduct. This
Although American punitive damages have come under much criticism lately, many of the studies
seem to undercut much of that criticism. Although some studies show the dollar amounts growing, the
real problem is the unpredictable nature of punitive awards. Available studies show that the median ratio
of punitive to compensatory awards has remained 1:1; however the spread between high and low awards
is great which means in the outlier cases defendants are being subjected to punitive damages that greatly
exceed the compensatory damages.
A penalty should be reasonably predictable in its severity, so that even Holmes’s “bad man” can look
General Question: Do you agree that $2.5 billion (or the original $5 billion) is excessive given the
enormity of the damage?
General Question: Is the maximum $507.5 million enough penalty to deter such a large
corporation?
Question: Does a strict 1:1 ratio tie the hands of many courts that might feel it appropriate to award
a greater amount?
Answer: The court does not think so. The court noted that the vast majority of punitive damage
Chapter 6 Intentional Torts and Business Torts 7
Business Torts
Tortious interference with business relations involves the defendant harming an existing contract or a
prospective relationship that has a definite expectation of success.
Tortious interference with a contract exists only if the plaintiff can establish the following four elements:
• There was a contract between the plaintiff and a third party;
Additional Case: Carvel v Noonan7
Facts: For decades, Carvel sold its ice cream only through franchised stores. However, a decline in
revenues caused the company to begin selling its product in supermarkets. That effort expanded quickly,
Issue: Had Carvel committed tortious interference with a prospective advantage?
Holding: Judgment for Carvel. In the words of the court:
The franchisees’ tort claim is that Carvel unlawfully interfered with the relationships between the
franchisees and their customers. The franchisees do not claim that the customers had binding
contracts that Carvel induced them to breach; they allege only that, by implementing its supermarket
program, Carvel induced the customers not to buy Carvel products from the franchisees. The juries
7 3 N.Y.3d 182, 785 N.Y.S.2d 359, 818 N.E. 2d 1100 New York Court of Appeals, 2004
8 Unit 1 The Legal Environment
preclude all competition; and the extent to which competition is allowed should be determined by the
contracts between the parties, not by courts or juries seeking after the fact to devise a code of conduct.
Question: On what theory did the franchisees sue Carvel?
Question: What must a plaintiff prove to win on this theory?
Answer: The plaintiff must prove that (1) it had a definite and reasonable expectation of
Question: What does “economic advantage” mean?
Answer: It means the plaintiff had a business relationship from which it expected an economic
benefit.
Question: How does this tort differ from tortious interference with contract?
Answer: The primary difference is that in tortious interference with contract the plaintiff had—
Question: What are the elements of tortious interference with contract?
Answer: (1) There was a contract between the plaintiff and a third party, (2) the defendant knew
Question: In the Carvel case, what was the basis for the plaintiffs’ claim of economic
advantage?
Question: What did Carvel do to upset the plaintiffs?
Answer: Carvel started to sell its products through other retail outlets such as supermarkets
Question: Did the court agree that this conduct amounted to tortious interference with
prospective advantage?
Answer: No, for two reasons:
Privacy and Publicity
The related torts of privacy and publicity involve unreasonable intrusion into someone’s private
life and unfair commercial exploitation by using someone’s name, likeness, or voice without
permission.
Negligence
The five elements of negligence are duty of due care, breach, factual causation, proximate causation, and
damages.
Discussion: The McDonald’s Hot-Coffee Case
Chapter 6 Intentional Torts and Business Torts 9
A majority of students are likely to have heard of the lawsuit in which Stella Liebeck sued McDonalds for
burns she suffered after spilling a cup of its take-out coffee in her lap. It is also likely that whatever these
students know about the case is either wrong or incomplete. Students may also have seen a chain email
about the “Stella” awards, named after Liebeck. Its message is that the tort system is out of control.
McDonalds knew of the risk of burns caused by its hotter-than-average coffee and knew that most
customers didn’t realize the specific risk posed by coffee at those temperatures, but nevertheless didn’t
intend to warn customers of the risk. The suit was not about a mere failure to warn that coffee is hot; it
was about failure to warn of the danger created by serving materially hotter-than-normal coffee to
customers who knew they were buying something hot, but not THAT hot.9
Negligence
To win a negligence case, a plaintiff must prove five elements. Much of the remainder of the chapter will
examine them in detail. They are:
• Duty of Due Care. The defendant had a legal responsibility to the plaintiff. This is the point from
the Palsgraf case.
Additional Landmark Case: Palsgraf v. Long Island Railroad10
Facts: Helen Palsgraf was waiting on a railroad platform. As a train began to leave the station, a man
carrying a package ran to catch it. He jumped aboard but looked unsteady, so a guard on the car
reached out to help him as another guard, on the platform, pushed from behind. The man dropped the
package, which struck the tracks and exploded—since it was packed with fireworks. The shock
knocked over some heavy scales at the far end of the platform, and one of them struck Palsgraf. She
sued the railroad.
Issue: Was the railroad liable for Palsgraf’s injuries?
10 Unit 1 The Legal Environment
Excerpts from Judge Cardozo’s Decision: The conduct of the defendant’s guard was not a wrong in
its relation to the plaintiff, standing far away. Relatively to her it was not negligence at all. Nothing in
the situation gave notice that the falling package had in it the potency of peril to persons thus
Duty of Due Care
We each of us have a duty to behave as a reasonable person under the circumstances.
Case: Hernandez v. Arizona Board of Regents11
Facts: The University of Arizona chapter of Delta Tau Delta fraternity gave a welcoming party for new
members. The fraternity’s officers knew that the majority of its members were under the legal drinking
age, but permitted everyone to consume alcohol. Minor John Rayner left the party, drove negligently, and
Issue: Did the fraternity and the other defendants have a duty of due care to Hernandez?
Holding: Judgment for defendants reversed and case remanded for trial. Excerpt from the court’s
opinion:
Traditional authority held that when “an able-bodied man” caused harm because of his intoxication,
the act from which liability arose was consuming, not furnishing, the alcohol. However the common
law also provides that:
11 177 Ariz. 244, 866 P.2d 1330, 1994 Ariz. LEXIS 6 Arizona Supreme Court, 1994
Chapter 6 Intentional Torts and Business Torts 11
injured. We join the majority of other states and conclude that as to Plaintiffs and the public in
general, defendants had a duty of care to avoid furnishing alcohol to underage consumers.
Arizona courts, therefore, will entertain an action for damages against [one] who negligently
furnishes alcohol to those under the legal drinking age when that act is a cause of injury to a third
person.
Question: The two lower courts found for all defendants. Why?
Answer: Presumably, they found that the defendants had no duty to Hernandez or the general
Question: What is the logic behind the lower courts’ position that a person or organization that
pours alcohol has no duty to the general public?
Answer: Historically, courts have held that it is a drunk driver who brought the harm on himself
General Questions:
• Should an organizational host, such as a fraternity, be liable for an accident caused by an
Special Duty: Landowners
In most states, a landowner’s duty of due care is lowest to trespassers; often higher to children
(especially if there is some man-made thing on the property that is likely to attract children); higher
still to a licensee (anyone on the land for her own purposes but with the owner’s permission); and
highest of all to an invitee (someone on the property as of right).
Special Duty: Professionals
A person at work has a heightened duty of care. While on the job, she must act as a reasonable
person in her profession.
Special Duty: Hiring and Retention
Companies must beware because they can be liable for hiring or retaining violent employees. In
Breach of Duty
If a legal duty of care exists, then a plaintiff must show that the defendant did not meet it.
Causation
To win, the plaintiff must also show that the defendant’s breach of duty caused the plaintiff’s harm.