Chapter 8: Intentional Torts and Business Torts

Chapter 8 – Intentional Torts and Business Torts 1 Chapter 8 Intentional Torts and Business Torts (1 of 7) ◦Tort: A violation of a duty imposed by the civil law ◦Intentional Tort: Harm caused by a deliberate action ◦8-1 Intentional Torts ◦8-1a Defamation ◦L...

Chapter 8 – Intentional Torts and Business Torts 1 Chapter 8 Intentional Torts and Business Torts (1 of 7) ◦Tort: A violation of a duty imposed by the civil law ◦Intentional Tort: Harm caused by a deliberate action ◦8-1 Intentional Torts ◦8-1a Defamation ◦Libel: Written defamation ◦Slander: Oral defamation 2 8-1 Intentional Torts (2 of 7) ◦8-1a Defamation (cont) ◦The elements in a defamation case are: ◦Defamatory statement: A factual statement likely to harm another ◦Falsity: The statement must be false ◦Communicated: It must be communicated to at least one other person ◦Injury: plaintiff must show injury unless the statement constitutes slander per se 3 8-1 Intentional Torts (3 of 7) ◦8-1a Defamation (cont) ◦Slander per se: When oral statements relate to criminal or sexual conduct, contagious diseases, or professional abilities, they are assumed to be harmful to the subject’s reputation ◦Libel per se: When written statements relate to criminal or sexual conduct, contagious diseases, or professional abilities, they are assumed to be harmful to the subject’s reputation 4 8-1 Intentional Torts (4 of 7) ◦8-1a Defamation (cont) ◦The rule from the Landmark New York Times case is: ◦A public official can win a defamation case only by proving the defendant’s actual malice (the defendant knew the statement was false or acted with reckless disregard of the truth) ◦Absolute Privilege: A witness testifying in a court or legislature may never be sued for defamation 5 8-1 Intentional Torts (5 of 7) ◦8-1b False Imprisonment ◦False imprisonment: The intentional restraint of another person without reasonable cause and without consent ◦Generally, a store may detain a customer or worker for alleged shoplifting provided there is a reasonable basis for the suspicion and the detention is done reasonably ◦8-1c Intentional Infliction of Emotional Distress ◦Intentional Infliction of emotional distress: An intentional tort in which the harm results from extreme and outrageous conduct that causes serious emotional harm 6 8-1 Intentional Torts (6 of 7) ◦8-1d Battery and Assault ◦Battery: An intentional touching of another person in a way that is harmful or offensive ◦Assault: An act that makes a person reasonably fear an imminent battery ◦8-1e Trespass, Conversion, and Fraud ◦Trespass: Intentionally entering land that belongs to someone else or remaining on the land after being asked to leave 7 8-1 Intentional Torts (7 of 7) ◦8-1e Trespass, Conversion, and Fraud ◦Conversion: Taking or using someone’s personal property without consent ◦Fraud: Injuring another person by deliberate deception 8 8-2 Damages (1 of 5) ◦8-2a Compensatory Damages ◦Compensatory damages: Money intended to restore a plaintiff to the position he was in before the injury ◦Single recovery principle: Requires a court to settle the matter once and for all by awarding a lump sum for past and future expenses ◦8-2b Punitive Damages ◦Punitive damages: Damages that are intended to punish the defendant for conduct that is extreme and outrageous 9 8-2 Damages (2 of 5) ◦8-2b Punitive Damages (cont) ◦The Supreme court ruled that, in considering punitive damages, a court must consider these guideposts: ◦The reprehensibility of the defendant’s conduct ◦The ratio between the harm suffered and the award, and ◦The difference between the punitive award and any civil penalties used in similar cases ◦In a later case, the Supreme Court ruled that few awards exceeding a single-digit ratio between punitive and compensatory damages would satisfy due process 10 8-2 Damages (3 of 5) ◦8-2c Tort Reform and the Exxon Valdez ◦Some people believe that jury awards are excessive and need statutory reform; others say that excessive awards are rare and modest in size ◦About half of the states have passed limits ◦The laws vary, but many distinguish between economic damage and noneconomic damage ◦Typically, noneconomic damages are capped 11 8-2 Damages (4 of 5) ◦8-2c Tort Reform and the Exxon Valdez (cont) ◦In 2010, Captain Hazelwood’s negligence caused the Exxon Valdez to run aground off the coast of Alaska ◦The ship dumped 11 million gallons of oil into the sea, damaging 3,000 square miles of vulnerable ecosystem ◦The spill forced fisherman into bankruptcy, disrupted entire communities, and killed hundreds of thousands of birds and animals; many have still not recovered ◦The jury found that Exxon had been reckless by allowing Hazelwood to pilot the ship, knowing he was an alcoholic 12 8-2 Damages (5 of 5) ◦8-2c Tort Reform and the Exxon Valdez (cont) ◦They awarded compensatory damages of $507 million, and punitive damages of $5 billion; Exxon appealed ◦Two decades later, the Supreme Court ruled; they declared that the real problem with punitive damages was its unpredictability ◦They ruled that in maritime cases, the ratio of compensatory to punitive damages should be no more than 1:1, and reduced the $5 billion punitive damage award to $507 million 13 8-3 Business Torts (1 of 3) ◦8-3a Tortious Interference with Business Relations ◦The law permits and expects businesses to compete aggressively; but there are times when healthy competition becomes illegal interference ◦8-3b Tortious Interference with a Contract ◦Tortious interference with a contract: An intentional tort in which the defendant improperly induced a third party to breach a contract wit the plaintiff ◦The defendant may try to prove there was no contract, or that special circumstances made its conduct fair 14 8-3 Business Torts (2 of 3) ◦8-3c Tortious Interference with A Prospective Advantage ◦Tortious interference with a prospective advantage: Malicious interference with a developing economic relationship ◦A plaintiff who has a definite and reasonable expectation of obtaining an economic advantage may sue a corporation that maliciously interferes and prevents the relationship from developing 15 8-3 Business Torts (3 of 3) ◦8-3d The Lanham Act ◦The law provides broad protection against false statements intended to hurt another business; to win, plaintiff must prove that: ◦The defendant made false or misleading fact statements about plaintiff’s business ◦Defendants used the statements in commercial advertising or promotion ◦The statements created the likelihood of harm to the plaintiff 16 Chapter Conclusion ◦This chapter has been a potpourri of misdeeds, a bubbling cauldron of conduct best avoided ◦Although tortious acts and their consequences are diverse, two generalities apply: ◦The boundaries of intentional torts are imprecise, the outcome depending upon the fact finder who analyzes it ◦Thoughtful executives and careful citizens, aware of the shifting standards and potentially vast liability, will strive to ensure that their conduct never provides that fact finder an opportunity to give judgment 17