American Home Assurance Company et al v. Greater Omaha Packing Company Inc.

Filing 432

MEMORANDUM OPINION - This matter is before the Court on plaintiff Cargill Meat Solutions Corporation's motion for summary judgement (Filing No. 219 ) on the defendants counterclaim. Plaintiff Cargill has filed a brief (Filing No. 220 ) and index of evidence (Filing No. 221 ) in support of its motion. The defendant filed a brief(Filing No. 363 ) and indices of evidence (Filing Nos. 364 , 365 , 366 , 367 , 368 , 369 ) in opposition of the motion. The plaintiff filed a reply brief (Filing No. 396 ) and index of evidence(Filing No. 397 ). The plaintiff's motion will be granted. A separate order will be entered in accordance with this memorandum opinion. Ordered by Senior Judge Lyle E. Strom. (AOA)

IN THE UNITED STATES DISTRICT COURT FOR THE
DISTRICT OF NEBRASKA
AMERICAN HOME ASSURANCE
COMPANY and CARGILL MEAT
SOLUTIONS CORPORATION,

)
)
)
)
Plaintiffs,
)
)
v.
)
)
GREATER OMAHA PACKING COMPANY,)
INC.,
)
)
Defendant.
)
______________________________)

8:11CV270

MEMORANDUM OPINION

This matter is before the Court on plaintiff Cargill
Meat Solutions Corporation’s motion for summary judgement (Filing
No. 219) on the defendant’s counterclaim.

Plaintiff Cargill has

filed a brief (Filing No. 220) and index of evidence (Filing No.
221) in support of its motion.

The defendant filed a brief

(Filing No. 363) and indices of evidence (Filing Nos. 364, 365,
366, 367, 368, 369) in opposition of the motion.

The plaintiff

filed a reply brief (Filing No. 396) and index of evidence
(Filing No. 397).
I.

The plaintiff’s motion will be granted.

BACKGROUND
An E. coli outbreak occurred in 2007 which gravely

injured several people.

An investigation traced the E. coli back

to a ground beef patty manufacturer, Cargill Meat Solutions,
Corp. (“Cargill”), who is the plaintiff in this case along with

American Home Assurance Company (“Assurance”).

The plaintiffs

have brought various contract claims against the defendant,
Greater Omaha Packing, Co. (“GOPAC”).

Essentially, the

plaintiffs claim that GOPAC sold Cargill meat contaminated with
the E. coli strain in violation of a contract between GOPAC and
Cargill.

GOPAC denies all claims and asserts a counterclaim

against the plaintiffs for the tortious interference with
business relationships and expectancies (hereinafter “Tortious
Interference”).

Filing No. 40, at 8.

The impetus for GOPAC’s counterclaim is an article in
which an attorney retained by Cargill allegedly commented on
aspects of this case, before it was filed, to a reporter.
Cargill had retained Shawn Stevens, attorney at Gass, Weber
& Mullins, to defend Cargill from claims brought by those injured
by the E. coli outbreak (Filing No. 220, at ¶22).

In the course

of Mr. Stevens’s work with Cargill, Mr. Stevens discovered facts
which led Cargill to assert claims against GOPAC and file this
current claim against it.

In late March 2009, New York Times

reporter, Michael Moss, first spoke to Mr. Stevens on the phone.
The two men spoke five times in total.

According to Mr. Stevens,

the conversations were initially innocuous and generalized
regarding how one performs traceback investigations in E. coli
outbreaks; however, Mr. Moss garnered additional facts underlying
-2-

the 2007 Cargill recall and began to ask Mr. Stevens more pointed
questions.

At that point, Mr. Stevens refused to answer

additional questions and ended the conversations.
On October 3, 2009, Mr. Moss published a ten-page,
Pulitzer-prize winning story regarding the E. coli outbreak, “The
Burger That Shattered Her Life” (Filing No. 210-1, at 1-10).
salient part, the New York Times article (hereinafter “the
Article”) read as follows:
Shawn K. Stevens, a lawyer in
Milwaukee working for Cargill,
began investigating. Sifting
through state health department
records from around the nation, Mr.
Stevens found the case of a young
girl in Hawaii stricken with the
same E. coli found in the Cargill
patties. But instead of a Cargill
burger, she had eaten raw minced
beef at a Japanese restaurant that
Mr. Stevens said he traced through
a distributor to Greater Omaha.
“Potentially, it could let Cargill
shift all the responsibility,” Mr.
Stevens said. In March, he sent
his findings to William Marler, a
lawyer in Seattle who specializes
in food-borne disease cases and is
handling the claims against
Cargill.
“Most of the time, in these
outbreaks, it’s not unusual when I
point the finger at somebody they
try to point the finger at somebody
else,” Mr. Marler said. But he
said Mr. Stevens’s finding “doesn’t
-3-

In

rise to the level of proof that I
need” to sue Greater Omaha.
It is unclear whether Cargill
presented the Hawaii findings to
Greater Omaha, since neither
company would comment on the
matter.
Filing No. 210-1, at 9.

It is important to note that GOPAC’s

claims do not focus on whether the Article itself was the cause
of damages.

Rather, GOPAC asserts the statements Mr. Stevens

made to Mr. Moss were disseminated to GOPAC’s clientele during
Mr. Moss’s investigation of the Article and thereby caused
damages (See Filing No. 40, at ¶17-21).
In order to determine whether GOPAC experienced damages
related to the Article or the statements Mr. Stevens made to Mr.
Moss, GOPAC commissioned an event study.

The event study

concluded that, prior to the publication of the Article and
through the end of the calender year, GOPAC’s price for boxedbeef was less than that of the national price for boxed beef.
GOPAC’s study attributes this variance to its customers’
knowledge of Mr. Stevens’s statements or the imminent release of
the Article.

Cargill moves the Court to grant summary judgement

against GOPAC’s Tortious Interference claim.

The issue in this

matter is whether, in the light most favorable to GOPAC, could

-4-

lead a reasonable juror to find for GOPAC’s Tortious Interference
claim.
II.

STANDARD OF REVIEW
Summary judgment may be granted when there is no

genuine issue of material fact and the moving party is entitled
to judgment as a matter of law.

Fed. R. Civ. P. 56.

Summary

judgment “should be rendered if the pleadings, the discovery and
disclosure materials on file, and any affidavits show that there
is no genuine issue as to any material fact and that the movant
is entitled to judgment as a matter of law.”
§ 56(c).

Fed. R. Civ. P.

Although, on a motion for summary judgment, the Court

must view all evidence in the light most favorable to the nonmoving party, the nonmoving party must show there is more than
some metaphysical doubt as to the material facts, and must
produce specific facts showing a genuine issue exists for trial.
See Torgerson v. City of Rochester, 643 F.3d 1031, 1042 (8th Cir.
2011) (quotations and citations omitted).

“Where the record

taken as a whole could not lead a rational trier of fact to find
for the nonmoving party, there is no genuine issue for trial.”
Id. (citations and quotation omitted).

The Court only considers

admissible evidence offered by the parties to defeat summary
judgment.

In re Zurn Pex Plumbing Prods. Liab. Litig., 644 F.3d

604, 613 (8th Cir. 2011).
-5-

III. TORTIOUS INTERFERENCE
In this case, Nebraska law controls the analysis of
Tortious Interference.

Tortious Interference is essentially when

“the defendant intentionally disrupted a commercial relationship
between the plaintiff and a third party.”

Bucktail I Ranch v.

Farm Credit Bank of Omaha, Corp., No. A-91-286, 1993 WL 70942, at
*3 (Neb. Ct. App. 1993) (citations omitted).

Under Nebraska law,

the elements of Tortious Interference require a claimant to prove
all the following:
(1) the existence of a valid
business relationship or
expectancy,
(2) knowledge by the interferer of
the relationship or expectancy,
(3) an unjustified intentional act
of interference on the part of the
interferer,
(4) proof that the interference
caused the harm sustained, and
(5) damage to the party whose
relationship or expectancy was
disrupted.
The Lumar Co. v. City of Fremont, 278 Neb. 485, 497, 771 N.W.2d
894, 906 (2009) (citing Aon Consulting v. Midlands Fin. Benefits,
275 Neb. 642, 748 N.W.2d 626 (2008)).

In addition, “[o]ne of the

basic elements of tortious interference with a business
relationship requires an intentional act which induces or causes
-6-

a breach or termination of the relationship.”

Wiekhorst Bros.

Excavating & Equip. Co. v. Ludewig, 247 Neb. 547, 557, 529 N.W.2d
33, 40 (1995) (citing Renner v. Wurdeman, 231 Neb. 8, 434 N.W.2d
536 (1989); Miller Chemical Co., Inc. v. Tams, 211 Neb. 837, 320
N.W.2d 759 (1982).

Viewing the facts in a light most favorable

to GOPAC, GOPAC has not established sufficient evidence to
support a finding for its Tortious Interference claim.
One of the basic elements of tortious interference
with a business relationship requires an intentional interference
inducing or causing a breach or termination of the relationship
or expectancy.

Delay First Nat. Bank & Trust Co. v. Jacobson

Appliance Co., 196 Neb. 398, 410-11, 243 N.W.2d 745, 752 (1976).
GOPAC offered no admissible evidence that Cargill or Mr. Stevens
intentionally interfered.
Cargill itself did not contribute to the Article or to
the statements of Mr. Stevens.

GOPAC, however, alleges a string

of privileged documents demonstrates Cargill’s strategy to blame
GOPAC for the outbreak.

Filing No. 363, at 65-69.

The Court

examined in camera1 those documents and determined that the
documents were privileged and do not stand for the proposition
GOPAC implies.

1

No fact in the record supports GOPAC’s claim

See Filing No. 332.
-7-

Cargill affirmatively acted to interfere with GOPAC’s business
relations.
GOPAC claims Mr. Stevens was an agent of Cargill when
he made the statements to Mr. Moss, and, therefore, his
statements are imputed to Cargill.

Filing No. 363, at 69-72.

Furthermore, GOPAC claims that Mr. Stevens spoke on behalf of
Cargill and had consent to release information to Mr. Moss.
Filing No. 363, at 46, ¶52-¶54.

However, the statements within

the Article and the e-mails from Mr. Moss to Cargill are hearsay
insofar as GOPAC cannot use those documents at trial to prove the
matters asserted therein.

First, GOPAC lacks any evidence that

Cargill expressly authorized Mr. Stevens to speak to Mr. Moss.
Second, GOPAC lacks any evidence that Cargill impliedly
authorized Mr. Stevens to speak to Mr. Moss.

To the contrary,

evidence exists which undermines the subjective element of this
inquiry.

Filing Nos. 221-14, at 23-24 (stating Mr. Stevens’s

belief that he lacked authorization to release information
regarding his alleged statements to Mr. Moss).

There is no

evidence shows Mr. Stevens had actual authority to communicate
with Mr. Moss regarding their alleged communication.

Finally,

there is no evidence to establish Mr. Stevens had apparent
authority.

Therefore, Mr. Steven’s alleged intent cannot be

imputed to Cargill.
-8-

Also, Cargill lacked intent.

As stated before, Mr.

Stevens intent is not imputable to Cargill.

However, no

admissible evidence exists that Mr. Stevens or Cargill wished to
communicate to Mr. Moss in an attempt that was substantially
certain to reduce GOPAC’s sales prices.

In a light most

favorable to GOPAC, no evidence exists to prove direction or
intent to leak information to the press that was damaging to
GOPAC.
Finally, no admissible evidence exists that Mr. Stevens
made the comments to Mr. Moss that the Article attributes to him.
The evidence which GOPAC wishes to use to attribute those
comments contradict Mr. Stevens testimony and are hearsay
statements.

Filing No. 363, at 46-51.

These hearsay statements

and bare accusations are insufficient to lead a reasonable jury
to find for GOPAC’s Tortious Interference claim.

A separate

order will be entered in accordance with this memorandum opinion.
DATED this 4th day of April, 2014.
BY THE COURT:
/s/ Lyle E. Strom
____________________________
LYLE E. STROM, Senior Judge
United States District Court

-9-