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Truth as an Affirmative Defense to Tortious Interference — Not in Virginia or North Carolina

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From Smithfield Foods, Inc. v. United Food & Commercial Workers Int’l Union, 593 F.Supp.2d 840 (E.D. Va. 2008):

The parties agree that whether "truth" can serve as an affirmative defense to tortious interference would present an issue of first impression in Virginia.

In support of its Motion, Smithfield primarily relies on the Supreme Court of Virginia's decision in Chaves v. Johnson, 230 Va. 112, 335 S.E.2d 97 (1985). In Chaves, 230 Va. at 121, 335 S.E.2d at 103, the Supreme Court of Virginia articulated five permissible affirmative defenses to a claim of tortious interference: (1) legitimate business competition; (2) financial interest; (3) responsibility for the welfare of another; (4) directing business policy; and (5) the giving of requested advice. In subsequent cases, the Supreme Court of Virginia has refused to recognize additional affirmative defenses to the tort, see Lockheed Info. Mgmt. Sys. Co. v. Maximus, Inc., 259 Va. 92, 524 S.E.2d 420 (2000) (rejecting "protection of public interest" as an affirmative defense), but has apparently not categorically foreclosed the possibility that other affirmative defenses could be recognized in time.

The Defendants correctly note that the Second Restatement of Torts lists "truth" as an affirmative defense to a claim of tortious interference. The Second Restatement provides:

One who intentionally causes a third person not to perform a contract or not to enter into a prospective contractual relation with another does not interfere improperly with the other's contractual relation, by giving the third person

(a) truthful information, or

(b) honest advice within the scope of a request for the advice.

Restatement (Second) of Torts § 772 (1979) (emphasis added). The Defendants contend that the Supreme Court of Virginia would follow the lead of the Second Restatement and thereby permit an affirmative defense of truth in this case.

***[I] it is highly persuasive that in Chaves, the Court noted the First Amendment implications of its holding, but rejected the defendant's freedom-of-speech argument.... [I]n assessing the merits of a tortious interference claim, the Supreme Court of Virginia focused on the motives of the alleged tortfeasor's actions, as opposed to the veracity of the statements uttered by the tortfeasor....

Moreover, it is highly significant that, in Chaves, the Supreme Court of Virginia specifically made reference to certain provisions of the Second Restatement of Torts, but nevertheless failed explicitly to incorporate the Restatement's affirmative defenses into its holding. ***

Finally, it is notable that the Virginia Supreme Court has expressly declined to extend the principles of defamation law to claims for tortious interference with contract or business expectancies, thereby strengthening the inference that "truth" is irrelevant to a claim of tortious interference in Virginia. ***

In North Carolina, it is apparent that the relevant inquiry in a tortious interference claim is the motive behind the tortfeasor's actions, and not the veracity of the tortfeasor's statements. Under North Carolina law, "[w]hether an actor's [tortious interference claim] is justified depends upon the circumstances surrounding the interference, the actor's motive or conduct, the interests sought to be advanced, the social interest in protecting the freedom of action of the actor, and the contractual interests of the other party." Embree Constr. Group, Inc. v. Rafcor, Inc., 330 N.C. 487, 498, 411 S.E.2d 916, 924 (1992) (emphasis added). Nevertheless, "[g]enerally speaking, interference with contract is justified if it is motivated by a legitimate business purpose, as when the plaintiff and the defendant . . . are competitors." ... Consequently, in Embree, the Court made clear that the predominant inquiry in assessing a claim of tortious interference is the motive of the speaker. ***

These decisions teach that the North Carolina courts also would not accept "truth" as a defense to a tortious interference claim.

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New York Attorneys JHA handles range the gamut of complex financial and commercial litigation and arbitration, including securities, RICO, corporate and contract disputes, credit default swaps, derivatives, and class, mass, and derivative actions. The firm also represents law firms in major disputes.
New York Attorneys JHA handles range the gamut of complex financial and commercial litigation and arbitration, including securities, RICO, corporate and contract disputes, credit default swaps, derivatives, and class, mass, and derivative actions. The firm also represents law firms in major disputes.

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