Smith v. Antler Insanity, LLC et al
Filing
48
ORDER granting in part and denying in part 39 Motion to Dismiss. Signed by Honorable David C. Bramlette, III on October 27, 2014 (AA)
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF MISSISSIPPI
NORTHERN DIVISION
SHANE SMITH
PLAINTIFF
VS.
CIVIL ACTION NO: 3:13-cv-841-DCB-MTP
ANTLER INSANITY, LLC; BYG OUTDOORS, LLC;
JOHN YOUNG; SCOT GARLAND;
RANDY BUCKNER; and DARRIN HOLT
DEFENDANTS
ORDER GRANTING IN PART AND
DENYING IN PART MOTION TO DISMISS
This
matter
is
before
the
Court
on
Defendants’,
Antler
Insanity, LLC, BYG Outdoors, LLC, John Young, Scot Garland, Randy
Buckner, and Darrin Holt, Motion to Dismiss [docket entry no. 39].
Having carefully considered the motion and responses, applicable
statutory and case law, and being otherwise fully informed in the
premises, the Court finds as follows:
I. Factual and Procedural Background
The Plaintiff Shane Smith initiated this action in the Circuit
Court of Yazoo County, Mississippi, on May 31, 2013. The Defendants
removed it to this Court, claiming diversity jurisdiction, on June
24, 2013. Notice Removal, ECF No. 1. Smith filed his amended
complaint on May 1, 2014. Am. Compl., ECF No. 37. In it he puts
forth five causes of action against the defendants: (1) breach of
contract, (2) negligent and/or intentional infliction of emotional
distress, (3) defamation, (4) tortious interference with business
1
relations, and (5) violations of the Lanham Act. Am. Compl. ¶¶ 4044.
The dispute arises from the termination of Smith’s contractual
relationship with Antler Insanity, LLC, (“Antler Insanity”) and BYG
Outdoors, LLC, (collectively, the “corporate defendants”) and some
unreimbursed expenses from before his termination. Smith began
working for the corporate defendants in May of 2011. Am. Compl. ¶
11. The corporate defendants terminated Smith’s employment on April
30, 2012. Am. Compl. ¶ 20. Smith had previously submitted an
“expense reimbursement report” on April 7, 2012. Am. Compl. ¶ 19.
After his termination, the corporate defendants sent Smith a letter
“partially approving [his] reimbursement request, but denying part
of
the
reimbursement
until
additional
documentation
could
be
provided by [Smith].” Am. Compl. ¶ 21. Smith submitted “additional
documentation to [the corporate] Defendants or provided explanation
as to why such documentation was not necessary” in a letter dated
September 11, 2012. Am. Compl. ¶ 22. Smith further alleges that,
even up to the date of filing this suit, the corporate defendants
and John Young, Scot Garland, Randy Buckner, and Darrin Holt
(collectively,
the
“individual
defendants”)
have
“sought
to
intentionally disparage [Smith] to others in the outdoor television
industry” and harm his future employment prospects. Am. Compl. ¶¶
33-34. Lastly, Smith alleges that he created a “specific graphic
logo, which
he
registered
with
2
the
United
States
Patent
and
Trademark
Office”
(“PTO”),
and
the
corporate
defendants
and
individual defendants continue to use the mark in their business.
Am. Compl. ¶¶ 36-38. Antler Insanity has filed a counterclaim
against Smith alleging fraudulent registration of the logo by
Smith, a right to register the logo itself, and common law unfair
competition created by Smith’s allegedly fraudulent registration.
Answer & Countercl. p. 12-14, ECF No. 38.
II. Analysis
The individual defendants have moved to have the case against
them dismissed for lack of personal jurisdiction through Federal
Rule of Civil Procedure 12(b)(2). Both the corporate and individual
defendants have moved to dismiss the case for failure to state a
claim through Rule 12(b)(6).1
A. Personal Jurisdiction Over the Individual Defendants
“A federal court sitting in diversity may exercise personal
jurisdiction only to the extent permitted a state court under state
law.” Paz v. Brush Engineered Materials, Inc., 445 F.3d 809, 812
(5th Cir. 2006). The Mississippi Supreme Court has ruled that
“[t]he proper order when analyzing personal jurisdiction over
nonresident defendants is to first consider whether the long-arm
statute subjects a nonresident defendant to personal jurisdiction
and then to consider whether the statute’s application to that
1
All references in this opinion are to the Federal Rules of
Civil Procedure unless otherwise noted.
3
defendant
offends
the
Due
Process
Clause
of
the
Fourteenth
Amendment to the U.S. Constitution.” Estate of Jones v. Phillips ex
rel. Phillips, 992 So. 2d 1131, 1137 (Miss. 2008). Mississippi’s
long-arm statute provides the courts shall have jurisdiction over
a nonresident who: (1) “make[s] a contract with a resident of this
state to be performed in whole or in part by any party in this
state,” (2) “commit[s] a tort in whole or in part in this state
against a resident or nonresident”, or (3) “do[es] any business or
perform[s] any character of work or service in this state.” Miss.
Code Ann. § 13-3-57 (1991).
The individual defendants are not residents of Mississippi.
Further, Smith concedes that the individual defendants are not
subject to jurisdiction under either the contract or business
prongs of the long-arm statute. Mem. Opp. p. 4, ECF No. 45.
(“Plaintiff Shane Smith does not allege that the non-resident
individual Defendants are subject to personal jurisdiction under
the first or third prongs of the Mississippi long-arm statute.”)
Therefore, the Court will only analyze whether the individual
defendants meet the tort prong of the statute.
When “personal jurisdiction is predicated on the commission of
a tort: ‘The jurisdictional question involves some of the same
issues as the merits of the case, and the plaintiff must make a
prima facie case on the merits to withstand a motion to dismiss
under Rule 12(b)(2).’” Unified Brands, Inc. v. Teders, 868 F. Supp.
4
2d 572, 577-78 (S.D. Miss. 2012) (quoting Wyatt v. Kaplan, 686 F.2d
276, 280 (5th Cir. 1982)). The plaintiff must not only show “that
a tort has occurred. . . . [The plaintiff] must also make a prima
facie showing that the tort occurred within [Mississippi].” Wyatt,
686 F.2d at 280. Mississippi courts “do[] not require that the
action giving rise to the tort actually occur in Mississippi in
order for a tort to be committed in state.” Yatham v. Young, 912
So. 2d 467, 470 (Miss. 2005). Further, “a tort is committed in
Mississippi when the injury results in this State. This is true
because an injury is necessary to complete a tort.” Id. As the
individual defendants correctly state in their brief, the Fifth
Circuit has “been careful to distinguish actual injury from its
resultant consequences.” Allred v. Moore & Peterson, 117 F.3d 278,
282 (5th Cir. 1997); see also Reply p. 2, ECF No. 46. And the
“consequences stemming from the actual tort injury do not confer
personal jurisdiction at the site or sites where such consequences
happen to occur.” Jobe v. ATR Marketing, Inc., 87 F.3d 751, 753
(5th Cir. 1996). However, the result is different when the damages
are an element of the tort.
Smith alleges tortious interference with his business by the
individual defendants. Smith alleges that he suffered “financial
detriment”
prevent
because
[him]
from
of
the
being
individual
able
to
defendants’
procure
efforts
employment
“to
with
competitors of the Defendant.” See Am. Compl. ¶¶ 34-35. A court in
5
this
district
has
previously
addressed
the
application
of
Mississippi’s long-arm statute to this tort:
It is without question that Mississippi recognizes
the claim of tortious interference with a business
relationship, which “occurs when a person unlawfully
diverts prospective customers away from one’s business.”
Par Indus., Inc. v. Target Container Co., 708 So. 2d 44,
48 (Miss. 1996) . . . The elements necessary to prove
such claim are: “(1) the acts were intentional and
willful; (2) the acts were calculated to cause damage to
the plaintiffs in their lawful business; (3) the acts
were done with the unlawful purpose of causing damage and
loss, without right or justifiable cause on the part of
the defendants (which constitutes malice); and (4) actual
damage and loss resulted.” MBF Corp. v. Century Bus.
Commc’ns, Inc., 663 So. 2d 595, 598 (Miss. 1995)
(alterations in original).
The Court finds the allegations in the Amended
Complaint are sufficient to establish a prima facie
showing that the tortious interference claim was
committed, at least in part, in Mississippi because this
is the state in which the alleged damage and loss
occurred. See Allred v. Moore & Peterson, 117 F.3d 278,
282 (5th Cir. 1997) (explaining that “[u]nder the tort
prong of the Mississippi long-arm statute, personal
jurisdiction is proper if any element of the tort (or any
part of any element) takes place in Mississippi.”) . . .
[T]he Court finds that the loss and damage suffered by
[the plaintiff] in this case are not mere consequences of
a tort having occurred elsewhere.
Unified Brands, 868 F. Supp. 2d at 578-79. Judge Barbour in the
Unified Brands case also found that the lost business “necessarily
occur[red] in Mississippi as the principal place of business for
[the plaintiff].” Id., at 579. This Court makes the same inference
as to the damages alleged by Smith because he is a resident of
Mississippi. Therefore, the Court finds that the long-arm statute
applies to the individual defendants.
The
Court
next
considers
6
whether
the
“assertion
of
jurisdiction [over the individual defendants] under the long-arm
statute
offends
the
Due
Process
Clause
of
the
Fourteenth
Amendment.” Estate of Jones, 992 So. 2d at 1139. Due process allows
jurisdiction over a nonresident defendant when: “(1) that defendant
has purposefully availed himself of the benefits and protections of
the forum state by establishing minimum contacts with the forum
state, and (2) the exercise of jurisdiction over that defendant
does not offend traditional notions of fair play and substantial
justice.” Alpine View Co. Ltd. v. Atlas Copco AB, 205 F.3d 208, 215
(5th Cir. 2000). “Minimum contacts can be established either
through contact sufficient to assert specific jurisdiction, or
contacts sufficient to assert general jurisdiction.” Id. Here,
Smith does not allege contacts sufficient to subject the individual
defendants to general jurisdiction, so the Court will only analyze
those facts supporting specific jurisdiction. See Mem. Opp. p. 4,
ECF No. 45 (“Smith does not allege that the individual Defendants
are subject to general personal jurisdiction. . . .”).
Specific personal jurisdiction “exists when a nonresident
defendant has purposefully directed its activities at the forum
state and the litigation results from alleged injuries that arise
out of or relate to those activities.” Panda Brandywine Corp. v.
Potomac
Elec.
Power
Co.,
253
F.3d
865,
868
(5th
Cir.
2001)
(internal quotations omitted). The individual defendants argue that
they cannot be subject to jurisdiction because they are not parties
7
to the alleged employment agreement. See Mem. Supp. p. 8, ECF No.
40. However, the Supreme Court has “reject[ed] the suggestion that
employees who act in their official capacity are somehow shielded
from suit in their individual capacity. But jurisdiction over an
employee does not automatically follow from jurisdiction over the
corporation which employs him.” Keeton v. Hustler Magazine, Inc.,
465 U.S. 770, 781 n.13 (1984) (citing Calder v. Jones, 465 U.S.
783, 790 (1984)). Each of the individual defendants admits he is “a
member of Antler Insanity, LLC” in his declaration attached to the
motion to dismiss. See Mot. Dismiss Exs. 1-4 ¶ 4, ECF No. 39-1
through 39-4. Therefore, although the individual defendants were
not parties to the contract with Smith, their actions in their
official capacity can confer jurisdiction over them to this Court.
Further, “[e]ach defendant’s contacts with the forum State must be
assessed individually.” Calder, 465 U.S. at 790.
Judge Barbour also examined whether the due process clause
permits specific jurisdiction:
Courts have found that a single act that is directed at
the forum may be sufficient to confer specific
jurisdiction if the act gives rise to the plaintiff’s
cause of action. See e.g. Ruston Gas Turbines, Inc. v.
Donaldson Co., Inc., 9 F.3d 415, 419 (5th Cir. 1993).
Further, under Calder v. Jones, 465 U.S. 783, 104 S.Ct.
1482, 79 L. Ed. 2d 804 (1984), the exercise of specific
jurisdiction may be proper in cases in which a defendant
engages in intentional conduct that is calculated to
cause injury in the forum state. In this Circuit, the
analysis of Calder’s ‘effects’ test, as applied to
tortious interference claims, requires a determination of
“whether the alleged tortfeasor expressly aimed his outof-state conduct at the forum state by examining the
8
nexus between the forum and the injured contractual
relationships.” Mullins v. TestAmerica, Inc., 564 F.3d
386, 402 (5th Cir. 2009).
Unified Brands, 868 F. Supp. 2d at 580. “Under Calder, ‘an act done
outside the state that has consequences or effects within the state
will suffice as a basis for jurisdiction in a suit arising from
those consequences if the effects are seriously harmful and were
intended
or
highly
likely
to
follow
from
the
nonresident
defendant’s conduct.’” Mullins, 564 F.3d at 400 (quoting Guidry v.
U.S. Tobacco Co., 188 F.3d 619, 628 (5th Cir. 1999)). “The key to
Calder is that the effects of an alleged intentional tort are to be
assessed as part of the analysis of the defendant’s relevant
contacts with the forum.” Panda Brandywine, 253 F.3d at 869.
Further, “the plaintiff’s residence in the forum, and suffering of
harm there, will not alone support jurisdiction under Calder.”
Revell v. Lidov, 317 F. 3d 467, 473 (5th Cir. 2002).
The nexus here is the employment and professional relationship
between Smith and Antler Insanity. However, the Court is unable to
determine how the individual defendants satisfy this nexus because
Smith alleges “nothing in the First Amended Complaint that ascribes
specific conduct or statements to [the individual defendants] . .
. [I]t is not enough to simply rest on the use of the collective
term, ‘Defendants,’ in the allegations.” Gen. Retail Servs., Inc.
v. Wirelss Toyz Franchise, LLC, 255 F. App’x 775, 793 (5th Cir.
2007) (citing Rush v. Savchuk, 444 U.S. 320, 332-33 (1980)). Smith
9
has alleged no facts that support the individual defendants’
involvement in his tort claims. The individual defendants are
identified in the beginning of Smith’s amended complaint and never
again mentioned. Thus, the Court finds that Smith has failed to
meet his burden to show sufficient minimum contacts “that these
individuals could reasonably expect to hailed into court” in
Mississippi. Id. Therefore the individual defendants’ motion to
dismiss for lack of personal jurisdiction will be granted, and they
will be dismissed from this case. Because the Court has found
insufficient minimum contacts between the individual defendants and
Mississippi, it does not reach the issue of whether jurisdiction
over them would violate traditional notions of fair play and
substantial justice.
B. Failure to State a Claim
The corporate defendants submit two arguments in support of
their position that Smith has failed to state a claim: (1) Smith
has failed to meet the plausibility burden of Rule 8(a) and (2) his
claims
are
time-barred
by
Mississippi
Code
Annotated
(“MCA”)
Sections 15-1-29 and 15-1-35.
1. Rule 8(a) Plausibility
Rule 8(a) requires a plaintiff to plead a “short and plain
statement” of his claim. Fed. R. Civ. P. 8(a)(2). The Supreme Court
has raised the plaintiff’s burden by holding this short and plain
statement to a plausibility standard. In ruling on a motion to
10
dismiss, “[t]he court’s task is to determine whether the plaintiff
has stated a legally cognizable claim that is plausible. . . .”
Lone Star Fund V (U.S.), L.P. v. Barclays Bank, PLC, 594 F.3d 383,
387 (5th Cir. 2010) (citing Ashcroft v. Iqbal, 556 U.S. 662, 678
(2009)). A claim is plausible “when the plaintiff pleads factual
content that allows the court to draw the reasonable inference that
the defendant is liable for the misconduct alleged.” Iqbal, 556
U.S. at 678 (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 556
(2007)). Determining plausibility is a “context-specific task”
requiring
the
application
of
“judicial
experience
and
common
sense.” Id., at 679. But “[a] complaint must fail if it offers only
’naked assertions devoid of further factual enhancement.’” Doe v.
Robertson, 751 F.3d 383, 387 (5th Cir. 2014) (quoting Iqbal, 556
U.S. at 678)). Ruling on a motion to dismiss, courts “make all
inferences in a manner favorable to the plaintiff, ‘but plaintiffs
must allege facts that support the elements of the cause of action
in order to make out a valid claim.’” Wilson v. Birnberg, 667 F.3d
591, 595 (5th Cir. 2012) (quoting City of Clinton v. Pilgrim’s
Pride Corp., 632 F.3d 148, 152-53 (5th Cir. 2010)).
In a claim for breach of contract in Mississippi, a plaintiff
must plead: (1) the existence of a valid contract and (2) breach by
the defendant. Bus. Commc’ns, Inc. v. Banks, 90 So. 3d 1221, 122425 (Miss. 2012). Smith has pled the existence of a valid contract
and that, as part of that contract, the corporate defendants would
11
pay all of Smith’s work expenses. Am. Compl. ¶¶ 13, 18. Further,
Smith has pled that the corporate defendants breached the contract
by refusing to pay his submitted expenses. Am. Compl. ¶¶ 21, 24-25.
Therefore, the Court finds that Smith’s breach of contract claim
meets the burden of Rule 8.
In a claim for trademark infringement under the Lanham Act,
the plaintiff must show: (1) “ownership in a legally protectible
mark” and (2) “infringement by demonstrating a likelihood of
confusion.” Bd. of Supervisors for La. State Univ. Agric. & Mech.
Coll. v. Smack Apparel Co., 550 F.3d 465, 474 (5th Cir. 2008);
Wilson v. New Palace Casino, LLC, No. 1:11cv447, 2013 WL 870350, at
*9 (S.D. Miss. Mar. 2013). As to the first element, “proof of the
registration
evidence
of
that
a
mark
with
the
mark
is
the PTO
valid
and
constitutes
the
prima
registrant
facie
has
the
exclusive right to use the registered mark in commerce. . . .”
Amazing Spaces, Inc. v. Metro Mini Storage, 608 F.3d 225, 237 (5th
Cir. 2010) (citing Lanham Act §§ 7(b) & 33(a)). Further, “[a]
certificate of registration of a mark . . . shall be prima facie
evidence . . . of the owner’s ownership of the mark. . . .” 15
U.S.C. § 1057(b) (2010); see also 15 U.S.C. § 1115(a) (2002). The
Court finds that Smith has sufficiently pled his ownership of the
mark to survive a motion to dismiss by submitting a copy of his
certificate of registration of the mark with the PTO. See Am.
Compl. Ex. F p. 1, ECF No. 37-6. As to the second element,
12
“[l]ikelihood of confusion is synonymous with a probability of
confusion, which is more than a mere possibility of confusion.”
Elvis Presley Enterprises, Inc. v. Capece, 141 F.3d 188, 193 (5th
Cir. 1998). A court considers the following “digits of confusion”
to determine whether a likelihood of confusion exists: (1) the type
of mark involved, (2) similarity of the marks, (3) similarity of
the products or services, (4) identity of the retail outlets and
purchasers,
(5)
identity
of
the
advertising
defendant’s intent, and (7) actual confusion.
media
used,
(6)
Id., at 194. This
list is nonexhaustive, and a court may consider any other factor it
deems relevant. Id. The Court finds that a likelihood of confusion
has been sufficiently pled because the marks are identical and
Antler
Insanity
is
countersuing
over
ownership
of
the
logo.
Therefore, Smith has sufficiently pleaded this claim to survive a
motion to dismiss.
As to the remaining tort claims there appears to be scant
evidence to support the viability of these claims; however, the
Court will deny the motion to dismiss for failure to state a claim
at this stage in anticipation of careful review after discovery and
at
the
summary
judgment
stage.
The
Court
outlines
infra
the
necessary elements of each claim that Smith must prove.
In a claim for intentional infliction of emotional distress
the plaintiff is required to show:
1. The defendant acted willfully towards the plaintiff by
committing certain described actions;
13
2. The defendant’s acts are ones which evoke outrage or
revulsion in civilized society;
3. The acts were directed at or intended to cause harm to
the plaintiff;
4. The plaintiff suffered severe emotional distress as a
direct result of the acts of the defendant; and
5. Such resulting emotional distress was foreseeable from
the intentional acts of the defendant.
Rainer v. Wal-Mart Assocs., Inc., 119 So. 3d 398, 403-04 (Miss. Ct.
App. 2013) (internal quotations omitted). The requirements imposed
on a claim for negligent infliction of emotional distress are less
straightforward.
A strong argument can be made that Mississippi has
historically lacked a consistent emotional distress
jurisprudence in cases of simple negligence and that it
does not have one now . . . There is more than ample
Mississippi authority supporting either a broad or narrow
application of the right to recover emotional distress
damages in various contexts, and this has enabled courts
to selectively cite from abundant authority in support of
whatever result they deem appropriate in a particular
case.
Mississippi Law of Torts, § 20:6 Negligent Infliction of Emotional
Distress (2d ed. 2013). There are two leading lines of Mississippi
Supreme Court precedent that judges may choose from.
In one line of cases, the Court follows the majority view
that, where the defendant’s conduct rises only to the
level of simple negligence, the plaintiff must prove some
sort of physical manifestation of distress and/or
demonstrable injury, either physical or mental, and that
such injury must have been reasonably foreseeable to the
defendant. In another line of cases, the Supreme Court
has indicated an intent to “relax” the standard of proof
in emotional distress cases and follow the minority view
that a plaintiff may recover for emotional distress and
mental anguish proximately resulting from ordinary
negligence, provided only that the injury was reasonably
foreseeable to the defendant.
14
Id. However, the authors of Mississippi Law of Torts assert that
the most recent cases augur a “firm shift” to the more stringent
standard requiring proof of demonstrable, physical harm. Id.;
accord Montgomery v. CitiMortgage, Inc., 955 F. Supp. 2d 640, 653
(S.D. Miss. 2013) (finding the demonstrable harm standard “has been
more
consistently
applied
by
the
federal
district
courts
in
Mississippi and the Mississippi Supreme Court” and collecting
cases). Because Smith’s amended complaint does not plead some
direct physical injury caused by the negligent conduct of the
defendants, he may recover only in either “a claim of outrageous
conduct” or where there is a medically cognizable and treatable
“resulting physical illness or assault upon the mind, personality
or
nervous
system
of
the
plaintiff.”
Paz
v.
Brush
Eng’red
Materials, Inc., 949 So. 2d 1, 4 (Miss. 2007) (internal quotations
omitted). Further, this harm must have been reasonably foreseeable
from the actions of the defendant. Id. (citing Leaf River Forest
Products, Inc. v. Ferguson, 662 So. 2d 648, 658 (Miss. 1995)).
The corporate defendants argue that Mississippi law does not
recognize a claim for negligent infliction of emotional distress
based on defamation. Mem. Supp. p. 14 n.1, ECF No. 40. They cite to
authority from the Northern District of Mississippi stating that
such a cause of action cannot lie. See Lane v. Strang Commc’ns Co.,
297 F. Supp. 2d 897, 899 n.1 (N.D. Miss. 2003) (citing Mitchell v.
Random House, Inc., 865 F.2d 664 (5th Cir. 1989)). Some authority
15
for the same proposition exists in this district. See e.g., Hayne
v. The Innocence Project, No. 3:09cv218, 2011 WL 198128, at *11
(S.D. Miss. Jan. 20, 2011) (citing to Lane) (“Mississippi law does
not recognize
a
cause
of
action
for
negligent
infliction of
emotional distress arising from a defamation claim.”); Pierce v.
The Clarion Ledger (“Pierce I”), 433 F. Supp. 2d 754, 760 (S.D.
Miss. 2006) (citing to Lane) (“. . . [N]o cause of action exists
under
Mississippi
law
for
negligent
infliction
of
emotional
distress arising from non-commercial speech.”). However, the 5th
Circuit precedent relied on by the Lane court only holds that
Mississippi precedents do not support such a claim based on a
“written noncommercial publication.” Mitchell, 865 F.2d at 672; see
also Pierce v. The Clarion-Ledger (“Pierce II”), 236 F. App’x 887,
889
(5th
Cir.
2007)
(reiterating
the
rule
for
“written
noncommercial publications”). Further, the Mississippi Court of
Appeals has more recently implied in dicta that a “claim for
negligent infliction based upon defamation” may exist but “would
obviously require a successful claim of defamation.” Hudson v.
Palmer, 977 So. 2d 369, 384-85 (Miss. Ct. App. 2007) (finding it
unnecessary to formally recognize such a cause of action in that
case and citing to Lane and Pierce I),
cert. denied 977 So. 2d 343
(Miss. 2008); see also Lehman v. Holleman, No. 1:11cv284, 2012 WL
3915392, at *3 (S.D. Miss. Sep. 10, 2012) (citing to Hudson but
stating that such a claim has not previously been recognized).
16
Because the Hudson decision came out of the Mississippi Court of
Appeals, rather than the Mississippi Supreme Court, this Court is
not bound to follow it in this diversity case. Labiche v. Legal
Sec. Ins. Co., 31 F.3d 350, 351 (5th Cir. 1994) (“When there is no
ruling by the state’s highest court, it is the duty of the federal
court to determine as best it can, what the highest court of the
state would decide.”). However, based on these precedents, the
facts of this case, and the Court’s Rule 8 ruling supra, the Court
is unwilling to apply the extended Mitchell rule in this case, at
this time.
In a claim for defamation, the plaintiff must show:
(1) a false and defamatory statement concerning [the]
plaintiff;
(2) unprivileged publication to [a] third party;
(3) fault amounting at least to negligence on [the] part
of [the] publisher;
(4) and either actionability of [the] statement
irrespective of special harm or [the] existence of
special harm caused by publication.
Franklin v. Thompson, 722 So. 2d 688, 692 (Miss. 1998).
In a claim for tortious interference with business relations,
the plaintiff must plead: (1) intentional and willful acts by the
defendant;
(2)
that
the
acts
were
intended
to
damage
the
plaintiff’s business; (3) that the acts were unlawful; and (4)
actual damages caused by the defendant’s unlawful acts. MBF Corp.
v. Century Bus. Commc’ns, Inc., 663 So. 2d 595, 598 (Miss. 1995).
2. Statute of Limitations
The corporate defendants lastly argue that Smith’s tort and
17
contract claims are time-barred. The Court will first analyze the
statute of limitations for Smith’s contract claim, followed by the
statute of limitations for his tort claims.
A. Contract Claim
The corporate defendants assert that the breach of contract
claim is
barred
by
MCA
Section 15-1-29.
MCA
Section
15-1-29
provides a one-year statute of limitations for unwritten employment
contracts from when the cause of action accrues. Miss. Code Ann.
§15-1-29 (1976). Smith argues that the longer three-year statute of
limitations for a written contract from MCA Section 15-1-49 should
apply.
Antler
Insanity
contests
the
existence
of
a
written
contract, and Smith has heretofore been unable to produce the
written agreement. However, the Court finds it unnecessary to
determine which statute of limitations should apply because Smith’s
claims are not time-barred under either.
In a breach of contract claim, the cause of action accrues at
the time of the breach. Young v. S. Farm Bureau Life Ins. Co., 592
So. 2d 103, 107 (Miss. 1991) (quoting Johnson v. Crisler, 156 Miss.
266, 269 (1930)). The corporate defendants contend that Smith’s
cause of action accrued no later than April 30, 2012, the date his
employment was terminated. Reply p. 4, ECF No. 46. Smith argues,
however, that his cause of action accrued sometime after September
11, 2012, the date he sent a letter to the corporate defendants
elaborating upon his request for reimbursement. Mem. Opp. p. 11,
18
ECF No. 45. “[A] breach of contract is a failure, without legal
excuse, to perform any promise that forms the whole or part of a
contract.” 23 Williston on Contracts § 63:1 (4th ed. 2014).
Smith submitted his reimbursement report three weeks before
his termination, therefore, the contract was not breached before
then and his reimbursement was still pending at that time. The
corporate defendants have not explicitly argued and cite to no
authority that termination should be construed as a denial of
Smith’s claims for reimbursement. Further, Smith attached to his
amended complaint an email sent from a party representing Antler
Insanity discussing Smith’s reimbursement report. The email is
dated June 30, 2012, one month after his termination. See Am.
Compl. Ex. D, ECF No. 37-4. In the email, Antler Insanity, through
its agent, states that the email and its attachments “represent[
Antler Insanity]’s position as to what reimbursement they will be
willing to make in a good faith effort to resolve this matter.” Id.
This clearly shows that Antler Insanity had not refused to pay
Smith’s expenses before then. It reads to the contrary, in fact:
Antler Insanity
was
agreeing
to
pay
some
of
Smith’s
claimed
expenses. Based on this correspondence and without finding a
specific date on which the contract was breached, the Court finds
that it could not have been breached before June 30, 2012. Smith
filed the case at bar on May 31, 2012. Therefore, Smith’s breach of
contract claim is not time-barred.
19
B. Tort Claims
The corporate defendants assert that Smith’s tort claims are
barred by MCA Section 15-1-35. The statute provides:
All actions for assault, assault and battery, maiming,
false imprisonment, malicious arrest, or menace, and all
actions for slanderous words concerning the person or
title, for failure to employ, and for libels, shall be
commenced within one (1) year next after the cause of
such action accrued, and not after.
Miss. Code Ann. § 15-1-35. While the statute facially applies to
Smith’s
defamation
interpreted
this
action,
statute
the
to
Mississippi
apply
to
Supreme
claims
of
Court
has
intentional
infliction of emotional distress, as well. Jones v. Fluor Daniel
Servs. Corp., 32 So. 3d 417, 422-23 (Miss. 2010). The corporate
defendants
argue
it
applies
also
to the
claims
for
tortious
interference with business relations and negligent infliction of
emotional distress “[b]ecause the allegations underlying those
claims ‘may be fairly categorized as one of the enumerated torts
[defamation], the one-year statute applies.’” Mem. Supp. p. 13-14,
ECF No. 40 (quoting Jones, 32 So. 3d at 423). The corporate
defendants assert that these two claims “arise[] solely from the
alleged defamation.” Mem. Supp. p. 13. However, the Mississippi
courts have previously held that the three-year “catch all” statute
of limitations from MCA Section 15-1-49 applies to claims of
negligent infliction of emotional distress. Air Comfort Sys., Inc.
v. Honeywell, Inc., 760 So. 2d 43, 47 (Miss. Ct. App. 2000) (citing
Norman v. Bucklew, 684 So. 2d 1246, 1256 (Miss. 1996); City of
20
Mound Bayou v. Johnson, 562 So. 2d 1212, 1217 (Miss. 1990)).
Furthermore, the three-year “catch all” statute also applies to
claims of tortious interference with business relations. Nichols v.
Tri-State Brick & Tile Co., Inc., 608 So. 2d 324, 333 (Miss. 1992)
(“[Tortious interference with business relations], however, simply
does not fit with any of the enumerated torts in [MCA 15-1-35].”).
The Court
finds
that
emotional
distress
the
and
claims
tortious
for
negligent
interference
infliction of
with
business
relations are clearly not time-barred; the facts, however, must be
more
closely
examined
to
determine
whether
the
claims
for
defamation and intentional infliction of emotional distress are
time-barred.
Smith asserts that these tort claims are not time-barred
because the “tortious actions took place at different times, months
after [his] April 30, 2012, termination.” He also quibbles with the
cases
cited
by
the
defendants
arguing
that
his
“case
is
distinguishable because [he] did not suffer [the tort damages] on
the date of his termination but instead suffered these damages at
the hands of the individual Defendants months later.” Mem. Opp. p
11-12, ECF No. 45. The Court will apply the same reasoning in
reaching its ruling on the Rule 8 issues supra to the issue of
whether these two claims are time-barred: the Court will deny the
motion to dismiss on this issue in anticipation of careful review
after discovery and at the summary judgment stage.
21
III. Conclusion
Based on the foregoing analysis, the Court finds that the
individual defendants, John Young, Scot Garland, Randy Buckner, and
Darrin Holt, should be dismissed from this action for a lack of
personal
jurisdiction.
The
Court
further
finds
that
the
plaintiff’s, Shane Smith, claims for negligent and/or intentional
infliction of emotional distress, defamation, tortious interference
with
business
relations,
breach
of
contract
and
trademark
infringement have been sufficiently pled. The Court lastly finds
that Smith’s breach of contract claim and tort claims are not timebarred.
IV. Order
IT IS HEREBY ORDERED that the Defendants’, John Young, Scot
Garland, Randy Buckner, and Darrin Holt, Motion to Dismiss for Lack
of Personal Jurisdiction is GRANTED.
FURTHER ORDERED that the Defendants John Young, Scot Garland,
Randy Buckner, and Darrin Holt are dismissed from this action.
FURTHER ORDERED that the Defendants’, Antler Insanity, LLC,
and BYG Outdoors, LLC, Motion to Dismiss for Failure to State a
Claim is DENIED.
SO ORDERED this the 27th day of October 2014.
/s/ David Bramlette
UNITED STATES DISTRICT JUDGE
22
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