Rich v. Fox News Network, LLC

United States Court of Appeals for the Second Circuit · 2019 · Torts

TortsIntentional Infliction of Emotional DistressTortious Interference with ContractNegligent SupervisionRespondeat SuperiorRule 12(b)(6)New York lawIIED

Facts

After Seth Rich was murdered, Zimmerman and Butowsky allegedly sought to move a false conspiracy theory tying Seth to WikiLeaks into the mainstream media. According to the complaint, they induced Seth's parents to hire Rod Wheeler as a private investigator while concealing Wheeler's connection to Fox and then worked with Wheeler to generate on-the-record support for a knowingly false Fox News story, despite contractual restrictions forbidding Wheeler from releasing investigative information without authorization. Fox published articles by Zimmerman that emphasized Wheeler's role as the Rich family's investigator and used that relationship to lend credibility to the false story. The Riches alleged severe emotional harm and related losses from the scheme and from Wheeler's breach of his confidentiality obligations.

Issue

Whether the complaint plausibly stated claims under New York law for intentional infliction of emotional distress and tortious interference with contract, and whether dismissal with prejudice of the negligent supervision or retention claim was proper. More specifically, the court considered whether the alleged coordinated scheme could constitute extreme and outrageous conduct, whether but-for causation and damages were adequately pleaded for tortious interference, and whether amendment should be permitted on the negligence count.

Rule

Under New York law, IIED requires extreme and outrageous conduct, intent to cause or disregard of a substantial probability of causing severe emotional distress, causation, and severe emotional distress; extreme and outrageous conduct may be shown by a deliberate and malicious campaign of harassment, and conduct may become outrageous when undertaken with knowledge of the plaintiff's peculiar susceptibility. Tortious interference with contract requires a valid contract, defendant's knowledge, intentional procurement of a breach without justification, actual breach, and resulting damages, plus but-for causation; emotional distress and consequential losses may be recoverable when reasonably expected to result from the interference. Negligent supervision or retention additionally requires an employer-employee relationship, employer knowledge of the employee's propensity, and a tort committed on the employer's premises or with its chattels, but if the employee acted within the scope of employment the proper theory is respondeat superior rather than negligent supervision.

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In Chicago, reporter Dana Mercer and commentator Neil Rowan wanted to boost a false story that a slain charity accountant had embezzled donor funds. Over four months, they befriended the accountant’s parents, persuaded them to hire a supposedly independent investigator secretly aligned with their outlet, fed that investigator fabricated details, and then published a story stressing that the investigator worked for the parents. The parents allege severe emotional collapse after the publication.

Under New York law as applied by the majority opinion, which is the strongest argument that the parents have stated a claim for intentional infliction of emotional distress?

Explanation. The majority emphasized that extreme and outrageous conduct should not be evaluated piecemeal where the allegations describe a coordinated scheme. Under the totality of the circumstances, a deliberate and malicious campaign of harassment or intimidation may satisfy the outrageousness requirement, even if individual acts viewed in isolation might not. The court rejected the idea that speech-related conduct is categorically excluded and also rejected reframing the parents’ claim as only a defamation claim on behalf of the deceased.