Tortious Interference with Prospective Economic Advantage Claim Fails for Lack of Allegations of a Related Crime or Independent Tort

On June 21, 2023, Justice Gomez of the Bronx County Commercial Division issued a decision in August Constr. Group, Inc. v. DeGroat, 2023 NY Slip Op. 50604(U), dismissing a tortious interference with prospective economic advantage claim for, among other things, failure to allege a related crime or independent tort, explaining:

The proponent of a claim for tortious interference with prospective economic advantage must demonstrate that defendant interfered with plaintiff’s prospective business relations by utilizing wrongful means or that the defendant acted solely to harm the plaintiff. Indeed, it must be alleged that defendant acted solely out of malice, that but for defendant’s conduct, plaintiff and a third-party would have consummated a contract, and the third-party with whom contractual relations were thwarted must be identified. Significantly, defendant’s wrongful conduct must amount to a crime or an independent tort, and may consist of physical violence, fraud or misrepresentation, civil suits and criminal prosecutions. Absent the allegation of an independent tort, claims that a defendant maliciously and deceitfully interfered with the consummation of a contract are clearly insufficient. Moreover, interference by persuasion alone although it is knowingly directed at interference with the contract is insufficient for purposes of a claim tortious interference with prospective economic advantage. Since, conduct constituting tortious interference with business relations is, by definition, conduct directed not at the plaintiff itself, but at the party with which the plaintiff has or seeks to have a relationship, any claim asserting the same must also allege that the tortious conduct was directed at a third-party.

. . .

The third cause of action for defendant’s alleged tortious interference with August’s prospective economic advantage, premised on the interference of the relationship between August and its subcontractors/vendors, is dismissed since the complaint fails to state a cause of action. As noted above, the proponent of a claim for tortious interference with prospective economic advantage must demonstrate that defendant interfered with plaintiff’s prospective business relations by utilizing wrongful means or that the defendant acted solely to harm the plaintiff, that defendant acted solely out of malice, that but for defendant’s conduct, plaintiff and a third-party would have consummated a contract, and the third-party with whom contractual relations were thwarted must be identified. Moreover, defendant’s wrongful conduct must amount to a crime or an independent tort, and may consist of physical violence, fraud or misrepresentation, civil suits and criminal prosecutions. Absent the allegation of an independent tort, claims that a defendant maliciously and deceitfully interfered with the consummation of a contract are clearly insufficient.

Here, the complaint fails to state a cause of action for tortious interference with prospective business advantage because it is bereft of any allegation that there was any contract, which but for defendant’s interference, would have been consummated between August and its subcontractors/vendors. Moreover, the complaint fails to allege, as it must, that the alleged interference was solely out of malice and/or solely to harm August. Lastly, besides alleging that the statements made by defendant were false, there is no other and independent tortious conduct alleged. Indeed, here, the complaint merely alleges that defendant’s conduct was conveying false information, in other words that he engaged in deceit, which is insufficient as a matter of law.

(Internal quotations and citations omitted).

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