Opinion
No. CV 00 0822116 S
August 1, 2003
MEMORANDUM OF DECISION ON MOTIONS FOR SUMMARY JUDGMENT
In this case, plaintiff's Economy Petroleum Corporation and Samuel Sack ("the Buyers") have brought suit against defendants Daniel J. Paulauskas, Susan Z. Paulauskas, Joseph G. Consorte, Jr., Alfred F. Morrocco, Jr. and Economy Oil Fuel, Inc. ("the Sellers") to recover money damages for vexations suit, under General Statutes § 52-568, in connection with a prior lawsuit ("the underlying action") brought against them by the Sellers. The plaintiffs' claim, as pleaded in their one-count Complaint dated November 27, 2000 ("Complaint") is based upon the following facts.
Section 52-568, entitled "Damages for groundless or vexatious suit or defense," provides as follows:
Any person who commences and prosecutes any civil action or complaint against another, in his own name or the name of others, or asserts a defense to any civil action or complaint commenced and prosecuted by another (1) without probable cause, shall pay such other person double damages, or (2) without probable cause, and with a malicious intent unjustly to vex and trouble such other person, shall pay him treble damages.
In 1993, the Sellers sold the assets of Economy Oil Fuel, Inc. to the Buyers and others. One term of the parties' Sales and Purchase Agreement required the Buyers to pay the Sellers 8 cents per gallon for fuel oil they sold the Sellers' former customers who continued to do business with the Buyers ("retained customers") during the three-year period after the sale.
During 1994, the Sellers began to question the accuracy of the Buyers' reported sales to retained customers and the resulting amounts of the Buyers' payments to them based upon such sales. Accordingly, they exercised their right under the Sales and Purchase Agreement to request an audit of Economy Petroleum's books and sales records. The audit revealed that the Buyers had failed to pay the Sellers $8,407 on past sales to retained customers.
After the audit was concluded, the Sellers demanded that the Buyers pay them two sums. The first sum demanded was $8,407, representing the deficiency in payments allegedly due them under the Sales and Purchase Agreement for past sales of fuel oil to retained customers, as determined by the audit. The Sellers claimed that the Buyers had breached the contract between them with respect to the deficiency by withholding delivery receipts and reporting lower-than-actual sales to retained customers to decrease the amount paid under the Sales and Purchase Agreement. The second sum demanded was $64,477, representing the difference between all payments the Sellers claimed that they had originally expected to receive from the Buyers in the three-year post-sale period if, as allegedly agreed, the Buyers continued to sell fuel oil to retained customers at pre-sale levels, and the lower total payments they then projected for that three-year period based on markedly lower actual sales to such customers to date. The Sellers claimed that the Buyers had also breached the Sales and Purchase Agreement by taking actions designed to drive away retained customers or reduce their fuel oil purchases, including, particularly, disconnecting a local phone number in New Britain, Connecticut by which retained customers in New Britain could call in their fuel orders toll-free and by charging higher prices to retained customers than to Economy Petroleum's other clients.
The Buyers responded to the Sellers' demands for payment by acknowledging that the sum of $8,407 was due and owing for past sales to retained customers, but declaring itself unwilling and unable to pay the additional sum of $64,477, which they claimed that the Sellers had no contractual or other right to receive under the Sales and Purchase Agreement. Economy Petroleum thus tendered to the Sellers the sum of $8,407 to resolve their dispute, but the tender was rejected.
Thereafter, in early 1996, the Sellers, through their attorney, defendant Morrocco, filed an application for a prejudgment remedy in the New Britain Superior Court. The stated basis for the application, by which the Sellers sought to attach real property owned by Ms. Jill Cohan, one of the Buyers' co-purchasers of Economy Oil Fuel, in the amount of $71,000, was the Sellers' asserted entitlement to the two sums it had demanded from the Buyers following the audit: first, the unpaid deficiency of $8,407, which the Buyers admittedly owed the Sellers and had tendered to them for pre-audit sales of fuel oil to retained customers; and second, the larger sum demanded by the Sellers to make up for the claimed shortfall between the total payments they originally expected to receive from the Buyers for fuel oil sold to retained customers in the three-year post-sale period and the lower payments they then expected to receive in that period due to lower-than-expected actual sales.
At the hearing on the PJR application on March 11, 1996, the Court, Arena, J., issued a prejudgment remedy in the amount of $8,000, based solely upon the Buyers' admitted failure to pay the Sellers all monies due them — specifically, $8,407 — for pre-audit sales of fuel oil to retained customers. At the same time, however, the court denied further relief because there was no basis in the Sales and Purchase Agreement for the Sellers' claimed right to expect that total sales to retained customers would remain at their pre-sale levels in the post-sale period.
Thereafter, however, the Sellers commenced an action against the Buyers in New Britain ("underlying action") to recover both sums allegedly due them under the Sales and Purchase Agreement. The underlying action, entitled Economy Oil Fuel, Inc. v. Economy Petroleum Corp., was assigned docket number CV 96-0471601S. In their three-count underlying complaint, the Sellers presented both of their claims together in each of three counts — one each sounding in breach of contract, detrimental reliance and fraudulent misrepresentation. The Buyers answered the underlying complaint by: admitting that they and the Sellers were parties to an agreement to purchase Economy Oil Fuel; Answer (4/16/97), ¶ 1, p. 1; admitting that they had agreed that, in addition to the sales price for Economy Oil Fuel, they would pay the Sellers eight cents per gallon for all fuel oil sold to retained customers for the three-year period from the date of the sale of the business; id., ¶ 2, p. 1; admitting that retained customers were those customers on the customer list sold to them as an asset of Economy Oil Fuel; id. ¶ 3, pp. 1-2; admitting that they owed the Sellers the sum of $8,407 based upon inadvertently underreported sales of fuel oil to retained customers, but pleaded that they had long been willing to pay the Sellers that sum plus reasonable costs incurred in calculating it, and thus that their failure to pay it to date had not caused the Sellers special damages; id., ¶ 5, p. 2; admitting that they had disconnected a New Britain phone number for their business, but denying that they were under any legal obligation to maintain that number; id. ¶ 4, p. 2; and admitting that they charged different rates for fuel oil to different customers, but denying that they had thereby breached any contractual obligation. Id. In addition, in their Request To Amend Answer dated March 6, 1998, the Buyers pleaded the special defense of tender as follows:
SPECIAL DEFENSE
1. The plaintiffs requested the opportunity to audit the Defendant, Economy Petroleum's, books in order to determine if they had received the correct amounts and calculated that they were owed $8,407 due to under-reported sales to retained customers.
2. The Defendants, Economy Petroleum and Stephen Sack, Jr., have never disputed the plaintiffs' calculation, and the Defendant, Economy Petroleum Corporation has tendered $8,407 to the plaintiffs on several occasions, which tenders have been refused by the plaintiffs.
Wherefore, since the Defendant, Economy Petroleum Corporation, has made tender or [sic] the $8,407, it has not been wrongfully withheld and the plaintiffs are not entitled to judgment for that sum.
Request To Amend Answer (3/6/98). The Sellers replied to this special defense by treating it as two special defenses as follows:
ANSWER TO SPECIAL DEFENSES
1. The plaintiffs agree to Special Defense number one to the extent that the plaintiffs did conduct an audit which, at the time of the audit, did disclose that according to the records provided $8,407.00 was due the plaintiffs for sales to "retained customers." The plaintiffs do not agree that this is the only sum owed them because no further audits have been undertaken.
2. The plaintiffs deny the defendant's second special defense.
Answer To Special Defenses (3/25/98).
The underlying action was ultimately tried on its merits on the first two counts only, after the Sellers unilaterally withdrew the third count without consideration. Attorney Trial Referee Lynn A. Ustach ("A.T.R. Ustach"), conducted the trial, concluded that judgment should enter for the Sellers in the amount of $8,407, which the Buyers admittedly owed and had tendered to them. She rejected, however, the Sellers' additional claim for payment based upon their alleged pre-sale expectations as to the likely volume of the Buyers' sales of fuel oil to retained customers in the three-year post-sale period because she found it unsupported by the clear, concise terms of the parties' fully integrated Sales and Purchase Agreement. Therefore, because the amount of the recommended judgment was exactly the same as that previously tendered by the Buyers, Attorney Ustach determined that costs should be awarded to the Buyers under the common-law rule of Katz v. Commercial Bank Trust Co., 102 Conn. 57, 127 A. 920 (1925). The Court, Shortall, J., adopted these findings and rendered judgment in accordance with them on August 4, 2000.
Prior to that the Sellers unilaterally withdrew their claim of fraud.
The Buyers claim that in light of its final resolution, the underlying action was terminated in their favor. Therefore, they contend, the Sellers' commencement and prosecution of that action constituted the maintenance of a vexatious suit, in violation of Section 52-568, because it was brought without probable cause as to every claim except that for which a pre-suit tender had been made, and with the malicious intent unjustly to vex and annoy them. As a result of the Sellers' prosecution of that underlying action, the Buyers claim that they suffered actual damages for legal fees, expenses and lost time by the individual plaintiff, Stephen Sack, Jr., as well as lost revenue from the sale of the business, which could not be consummated while the underlying action was still pending.
The Sellers have denied all of the material allegations of the Buyers' claims against them in this action and have interposed certain special defenses. All of the Sellers have specially pleaded that they are immune from liability under the Noerr-Pennington doctrine because all of their activities assertedly "consisted of petitioning activity aimed at procuring favorable governmental action or judicial redress; Answer and Special Defenses (of Defendant, Alfred F. Morrocco, Jr.) (8/31/01) ("Morrocco Answer and Special Defenses"), p. 3; Answer and Special Defenses of Defendant's [sic] Daniel J. Paulauskas, Susan Z. Paulauskas and Joseph G. Consorte (9/28/01) ("Paulauskas Answer and Special Defenses"), p. 2; and that the Buyers failed to mitigate their damages. Morrocco Answer and Special Defenses, supra; Paulauskas Answer and Special Defenses, supra, pp. 2-3. In addition, the Paulauskas Defendants have asserted a third special defense of "advice of counsel." The Buyers have denied all of the Sellers' special defenses. Reply (to defendant Morocco) (10/1/01); Reply (to Paulauskas defendants) (10/10/01).
The Noerr-Pennington doctrine shields from liability all persons who, in good faith, bring lawsuits or otherwise engage in activities involving the petitioning of government or governmental agencies or officials for the redress of grievances. The Appellate Court adopted the doctrine and its "sham exception" for use in Connecticut courts in Zeller v. Consolini, 59 Conn. App. 545, 758 A.2d 376 (2000).
On July 19, 2002, defendant Morocco filed a Motion for Summary Judgment which rests on two grounds: first, that the Buyers cannot establish that the underlying action terminated in their favor; and second, that the Buyers' claims are barred by the Noerr-Pennington Doctrine. He initially supported his Motion with a lengthy memorandum of law and a thick compendium of supporting materials, including: the Order for Prejudgment Remedy (1/17/96) in the underlying action; the Memorandum of Attorney Trial Referee (7/6/00) in the underlying action; the underlying complaint (11/14/00); the Morocco Answer and Special Defenses (8/31/01) in this action; and copies of several Connecticut cases.
On December 10, 2002, the Buyers responded to defendant Morocco's Motion for Summary Judgment by filing their own Plaintiffs' Cross Motion for Summary Judgment, together with a combined brief in opposition to the defendant's Motion and in favor of their own Cross Motion for summary judgment and additional supporting materials, including: the parties' Sales and Purchase Agreement (8/9/93) here at issue; the Sellers' Amended Complaint (2/21/97) in the underlying action; a certified transcript of the hearing on Sellers' application for prejudgment remedy before Judge Arena on March 11, 1996; an uncertified excerpt from the trial transcript in the underlying action; the Buyers' Answer to Plaintiffs' Amended Complaint (4/16/97) in the underlying action; the Buyers' Amended Special Defense (3/6/98) in the underlying action; and the Sellers' Answer to Special Defenses (3/29/98) in the underlying action. In their Cross Motion, the Buyers assert that they are entitled to partial summary judgment on the favorable termination element of their claim and on the defendant's special defense under the Noerr-Pennington Doctrine. On the latter point in particular, the Buyers claim that the Noerr-Pennington Doctrine is not applicable to this case as a matter of law since the underlying action did not involve petitioning a governmental agency for redress or asserting other protected rights to which the Doctrine applies.
On February 20, 2003, the defendant filed a Supplemental Objection to Plaintiffs' Cross Motion for Summary Judgment. Thereafter, following oral argument on the Motions, each party submitted at least one letter brief to the Court in response to the Court's general request for additional authority in support of their respective positions. The final such letter brief was filed on April 3, 2003.
I. SUMMARY JUDGMENT RULES AND STANDARDS
"Summary judgment is a method of resolving litigation when the pleadings, affidavits, and any other proof submitted show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Wilson v. New Haven, 213 Conn. 277, 279, 567 A.2d 829 (1989) (citations omitted). The burden of proof on a motion for summary judgment is on the moving party; Fogarty v. Rashaw, 193 Conn. 442, 445, 476 A.2d 582 (1984); who must clearly show that there is no genuine dispute either as to the existence of one or more facts which, if established, would entitle him to judgment as a matter of law, or as to the nonexistence of one or more facts upon which his opponent's right to judgment materially depends.
Notwithstanding the foregoing limitations, a party is entitled, in two situations only, to seek summary judgment as to issues that will not dispose of the entire action or any count or claim on which relief is sought therein. The first such situation is that envisioned in Practice Book § 17-50, which expressly authorizes the trial court to enter "[a] summary judgment, interlocutory in character, . . . on the issue of liability alone, although there is a genuine issue as to damages." In that event, the granting of summary judgment is followed by an immediate hearing in damages. Id. So worded, this rule obviously does not authorize the trial court to enter a summary judgment, interlocutory in character, on any issue other than liability. It therefore does not authorize the entry of such an order as to a mere element of a liability claim unless proof or disproof of that element is, in and of itself, determinative of the issue of liability.
The second such situation is that envisioned in Practice Book § 17-51, where "it appears that [a] defense [asserted in a motion for summary judgment] applies to only part of [a challenged] claim, or that any part [of the claim] is admitted[.]" In that event, the rule provides that "the moving party may have final judgment forthwith for so much of the claim as the defense does not apply to, or as is admitted, on such terms as may be just; and the action may be severed and proceeded with as respects the remainder of the claim." Id. So worded, Section 17-51 simply recognizes that some claims are really combinations of many claims, each of which, if pleaded separately, could afford the pleader a separate basis for relief. When such a combined claim is challenged by a motion for summary judgment, this rule merely permits the court to separate the claims from one another so that judgment can enter as to those as to which there is no genuine issue of material fact and only the remainder, which are still in dispute, can go to trial. The existence of this rule does not entitle a party to seek a binding judicial determination as to any issue in the case, such as a mere element of a challenged claim or a special defense, unless the result of his challenge to that element or special defense will be the entry of judgment as to a severable portion of the claim.
II. PLAINTIFF BUYERS' CROSS MOTION — PROCEDURAL DEFECT
The plaintiff Buyers' Cross Motion For Summary Judgment asks this Court to decide mere issues in this case in their favor: one essential element of their pending claim and one special defense which the defendant Sellers have interposed against them. They have not asked, nor could they ask on the grounds asserted in their Cross Motion, either for the entry of an interlocutory judgment in their favor on the issue of liability, as permitted by Practice Book § 17-50, or for a final judgment in their favor as to any part of their pending claim against the Sellers, as permitted by Practice Book § 17-51. Accordingly, the plaintiffs' Cross Motion is procedurally defective and must be DENIED.
III. DEFENDANT MORROCCO'S MOTION — FAVORABLE TERMINATION
A. The Requirement of Favorable Termination
At all times relevant to this case, General Statutes § 52-568 has provided in relevant part as follows:
Any person who commences and prosecutes any civil action or complaint against another, in his own name or the name of others, . . . (1) without probable cause, shall pay such other person double damages, or (2) without probable cause, and with a malicious intent unjustly to vex and trouble such other person, shall pay him treble damages.
On its face, this statute appears to create two related claims or causes of action based on combinations of three essential elements: (1) that the defendant commenced and prosecuted a civil action or complaint against the plaintiff; (2) that the defendant commenced and prosecuted said action or complaint without probable cause; and (3) that the defendant commenced and prosecuted said action with a malicious intent unjustly to vex and trouble the plaintiff. Proof of the first two elements, without more, would appear to entitle the plaintiff to an award of double damages, whereas proof of all three would appear to entitle him to treble damages.
It has long been held in Connecticut, however, that our statutory action for vexatious suit, which was first enacted in 1672, "is subject to the same general principles as are actions on the case, for malicious prosecution, at common law." Frisbie v. Morris, 75 Conn. 637, 639, 55 A. 9 (1903) (quoting Goodspeed v. The East Haddam Bank, 22 Conn. 530, 535 (1853)). Accordingly, a statutory claim for vexatious suit, like a common-law claim for malicious prosecution, has one additional requirement of proof that the plaintiff must invariably satisfy, to wit: "that such prosecution or suit terminated in some way favorably to the defendant therein." Frisbie, supra, 75 Conn. at 639 (citing 1 Swift's Digest, pp. 491-94, 617; Munson v. Wickwire, 21 Conn. 513, 515 (1852); Wall v. Toomey, 52 Conn. 35; Thompson v. Beacon Valley Co., 56 Conn. 493 (1888)); QSP, Inc. v. The Aetna Casualty Surety Co., 256 Conn. 343, 361, 773 A.2d 906 (2001).
To prove the "favorable termination" element of a claim for vexatious suit or malicious prosecution, the plaintiff need not
point to an adjudication on the merits in his favor or . . . show affirmatively that the circumstances of the termination indicated his innocence or nonliability, so long as the proceeding has terminated without consideration. [Citations omitted.] Instead, [the Supreme Court] ha[s] always viewed the issue of whether the outcome was "favorable" to the plaintiff as relevant to the issue of probable cause.
DeLaurentis v. New Haven, 220 Conn. 225, 251, 597 A.2d 807 (1991). Therefore, although the unilateral abandonment or withdrawal of a claim or action can fairly be considered a termination favorable to the defendant, because it suggests that the plaintiff lacked probable cause to pursue the claim or action further, withdrawal pursuant to a settlement agreement cannot be so considered because the defendant's act of settling suggests that, at least in his view, the claim or action was worthy of settlement, and thus not completely groundless. Blake v. Levy, 191 Conn. 257, 264, 464 A.2d 52 (1983).
In DeLaurentis v. New Haven, supra, our Supreme Court observed that
Two concerns underlie the requirement of "successful termination." The first is the danger of inconsistent judgments if defendants use a vexatious suit or malicious prosecution action as a means of making a collateral attack on the judgment against them or as a counterattack to an ongoing proceeding. Clewley v. Brown Transportation, Inc., 120 Conn. 440, 444, 191 A. 521 (1930); see also Paramount General Hospital Co. v. Jay, 213 Cal.App.3rd 360, 261 Cal.Rptr. 723 (1989); March v. Cacioppo, 37 Ill. App.2d 235, 246, 189 N.E.2d 397 (1962); 52 Am.Jur.2d, Malicious Prosecution § 29.
DeLaurentis, supra, 220 Conn. at 251-52. Plainly, a vexatious suit action cannot be put to either such potentially disruptive use if the plaintiff's right to bring it depends in the first instance upon the prior termination in his favor of the claim or action he claims to have been vexatiously pursued.
The second "concern" underlying the favorable termination requirement, as described in DeLaurentis,
is the unspoken distaste for rewarding a convicted felon or otherwise "guilty" party with damages in the event that the party who instituted the proceeding did not at the time have probable cause to do so. [Citations omitted.]
This concern is alleviated by requiring the underlying claim or action to go to judgment before a final assessment of probable cause to bring and prosecute it can be made. If the plaintiff prevails on the merits of the claim or action, probable cause to prosecute it is conclusively established. Id. at 252. The favorable termination requirement thus "serves to discourage unfounded litigation without impairing the presentation of honest but uncertain causes of action." Blake v. Levy, supra, 191 Conn. at 263.
B. The Parties' Claims with Respect to Favorable Termination
Here, the Sellers' Motion For Summary Judgment is based directly upon the claim that this action terminated favorably to them, not to the Buyers, because judgment was entered for them in the sum of $8,407 for payments due them under the Sales and Purchase Agreement based on the Buyers' pre-audit sales of fuel oil to retained customers during the three-year period after the sale. Although that sum was admittedly tendered to them before the underlying action was filed, and thus costs of the action were awarded to the Buyers, they claim, correctly, that no case in Connecticut legal history has ever treated a judgment requiring a defendant to pay a plaintiff damages as a judgment terminating in his favor for the purpose of later suing the prevailing plaintiff for vexatious suit. The judgment in their favor, claim the Sellers, also conclusively establishes that they had probable cause to commence and prosecute the underlying action under settled principles of Connecticut law. See, e.g., DeLanrentis, supra, 220 Conn. at 252.
The Buyers respond initially to this part of the Sellers' Motion by urging this Court to rule that since the only sum the Sellers recovered was one they could have had by accepting the Buyers' pre-suit tender and not suing at all, the judgment of the Court, which so limited the Sellers' recovery, was a termination favorable to them not favorable to the Sellers. That is why at common law, they argue, costs are awarded to the defendant who successfully pleads tender, not to the plaintiff who, by refusing the tender, initiates unnecessary litigation. As their fallback position, the Buyers argue that even if the judgment entered against them for the tendered sum of $8,407 is found to have been an unfavorable termination of the Sellers' pre-audit deficiency claim against them, they must still be permitted to maintain the present action based upon the Court's rejection on the merits of the Sellers' additional claim for lost payments due to their alleged failure to maintain fuel oil sales to retained customers at the pre-sale levels in the post-sale period. Insisting that this claim, which they have always alleged to be groundless, is logically severable from the pre-audit deficiency claim on which the Sellers "prevailed" at trial, the Buyers assert that they must be given the right to recover as damages the substantial additional fees and costs they incurred in the underlying action as a result of the Sellers' decision to pursue it.
C. Claim of Right to Bring Vexatious Suit Claim Based Upon Successful Interposition of Defense of Tender
The threshold question raised by the pending motions is whether the successful assertion of the defense of tender constitutes a favorable termination of the action from the perspective of the defendant. The Court agrees with the Sellers that it cannot. Although the judgment ultimately rendered for the Sellers was for the exact amount they could have received from the Buyers had they accepted the Buyers' tender before suit was filed, it was still a judgment in the Sellers' favor, and thus "conclusive proof" that the Sellers had probable cause to bring and prosecute the claim on which it was based. DeLaurentis, supra, 220 Conn. at 252. This fact alone requires the rejection of the Buyers' argument under prevailing Connecticut law.
Here, moreover, notwithstanding the trial court's decision to award costs to the Buyers due to their special defense of tender, it is apparent that the tender was not merely an unconditional offer to pay the full amount of the Sellers' pre-audit payment deficiency claim, but rather an offer to settle all outstanding financial issues between the parties based upon Sellers' recognition that the tendered sum was the only sum then due and owing to them. Obviously, the reason why the Sellers did not accept the Buyers' tender and forced this case to trial was the Buyers' refusal to honor the Sellers' additional demand for payment of their larger claim. This, then, is not a case where a plaintiff by filing suit in the face of an unconditional tender of the precise amount he has demanded, can be found to have embarked upon a wasteful, totally pointless exercise, imposing needless costs on his adversary and the court for no reason whatsoever. In the context of this case, the Sellers did what they had to do to preserve their right to proceed on their other, larger claim. Thus, although prevailing on that claim was a foregone conclusion, they had to put the claim in suit to effect a recovery on it if they also intended to pursue their other claim. In that sense, the Court's judgment on that claim constituted a termination of the action favorable to the Sellers.
Against this background, a legitimate question is raised, under authorities such as Hatch v. Thompson, 67 Conn. 74, 34 A. 770 (1895), as to whether the Buyers should have been awarded their costs. The rule of Hatch is that costs should not be awarded to a defendant who pleads tender unless that is his sole defense to the action. The case holds specifically that a plea of tender does not entitle a defendant to costs where, as part of his tender, he objects to any part of the plaintiff's claim, including the amount of that claim. Even, however, if it is too late in the process to revisit that issue at this time, it is not too late to note that, in light of the parties' positions in this case before it went to trial, the Sellers could not have accepted the Buyers' tender unless they were also willing to waive their larger, separate claim to the difference between actual and expected payments based upon sales to retained customers in the three-year period following the sale. It simply does not appear that a separate settlement of the smaller, pre-audit deficiency claim was ever offered with the intent of leaving the larger claim open for future discussion or litigation.
D. Claim of Right to Bring Vexatious Suit Claim Based Upon Partial Favorable Termination
Even if, as this Court has held, the entry of judgment for the Sellers on the claim as to which the Buyers specially pleaded tender defeats the Buyers' claim that the entire underlying action terminated favorably to them, a second, critical question arises as to whether the partial favorable termination of the underlying action supports a statutory claim of vexatious suit. There is no question that a major part of the underlying action did terminate favorably for the Buyers. The evidence, in fact, is undisputed that the Sellers withdrew their fraud claim without consideration before trial began, and that the Court rejected on its merits their additional claim for payment of the difference between anticipated payments based on expected sales of fuel oil to retained customers in the three-year post-sale period and projected payments based on actual sales to such customers in that period. The question presented is thus as follows: if the Sellers commenced and prosecuted their fraud claim and/or their additional claim for payment, as described herein, without probable cause and with a malicious intent unjustly to vex and annoy the Buyers, can the Buyers now sue the Sellers for vexatious suit on the basis of such conduct even though a part of their underlying action resulted in a judgment in their favor?
Although there is no appellate decision in Connecticut that decides this issue directly, our Supreme Court in DeLaurentis undeniably laid the groundwork for the resolution of the issue in favor of the Buyers. One key question that arose in DeLaurentis was whether the plaintiff could lawfully pursue a claim for vexatious suit based upon the defendant's maintenance of a proceeding against him where some claims made in that proceeding were supported by probable cause but others were not. The plaintiff's jury had been instructed to return a verdict for the defendant if they failed to find a lack of probable cause as to each and every claim made against the plaintiff in the underlying, allegedly vexatious proceeding. Upon finding that probable cause was lacking as to each such claim, the jury returned a verdict for the plaintiff, awarded him a single sum of damages without identifying or quantifying the individual contribution to such damages that resulted from the prosecution of any particular claim.
Upon determining that some but not all of the individual claims made against the plaintiff in the underlying proceeding had in fact been supported by probable cause, the Court was required initially to decide if a plaintiff could properly pursue an action for vexatious suit in those circumstances. Could the existence of probable cause to support one of many claims made in a single action or proceeding somehow immunize the claimant from vexatious suit liability for the simultaneous pursuit of other groundless claims?
The Court's answer to this question was a resounding "No," which it delivered as follows:
[F]or what must the defendant have lacked probable cause? For filing suit? For asserting a particular course of action? For alleging particular facts? If a civil plaintiff had probable cause to assert one cause of action but joined to that claim ten others that he knew to be groundless, the victim called upon to defend himself against the ten groundless claims would not suffer less because one good claim was included among them. It is common practice, however, for a plaintiff to allege alternative factual theories when he cannot be sure which version more accurately reflects the events that transpired. Each time a civil plaintiff responds to a request to revise, or amends his complaint after realizing one part of his claim is baseless, must he fear liability for vexatious suit?
[A]s stated by Lord Mansfield in Reed v. Taylor, 128 Eng.Rep. 472, 4 Taunt. 516 (CP 1812) ". . . [I]f a man prefers an indictment containing several charges, whereof for some there is, and for others there is not probable cause, this will support a count for preferring that indictment without probable cause." [Citation omitted.] We agree with those courts that have applied the same proposition in the civil context. See Paramount General Hospital Co. v. Jay, 213 Cal.App. 32, 360, 261 Cal.Rptr. 723 (1989); March v. Cacioppo, [ 37 Ill. App.2d 235,] 246 [(1962)]; Hales v. Raines, 162 Mo. App. 46, 60, 141 S.W. 917 (1911).
DeLaurentis, supra, 220 Conn. at 253-54.
Having come to this determination, the DeLaurentis Court next grappled with the issue of when one claim or charge was sufficiently separate from other claims or charges made in the underlying action or proceeding as to support a claim of vexatious suit if other claims or charges in that same proceeding were supported by probable cause. Usefully, the Court observed as follows:
In the civil context, what constitutes a separate "charge" for which probable cause is required is not always obvious. [Footnote omitted.] Two decisions involving underlying criminal prosecutions are, however, enlightening. In Janetka v. Dabe, [ 892 F.2d 187 (2d Cir. 1989)], the plaintiff in a malicious prosecution and civil rights action had been acquitted of resisting arrest but convicted of disorderly conduct. Reversing the trial court's dismissal of the plaintiff's malicious prosecution claim, the court noted that he had been "charged with two distinct offenses involving district allegations. The disorderly conduct charge involved Janetka's actions directed at the unidentified hispanic (sic) man; the resisting arrest charge involved his actions directed at the officers' attempts to arrest him. The elements of each charge are different, neither charge is a lesser included offense of the other." Id., 190. In Singleton v. Perry, [ 45 Cal.2d 489, 497 289 P.2d 794 (1955)], the Court sustained the jury's verdict finding probable cause for a charge in the criminal complaint that the plaintiff had stolen the complainant's auto, but awarding damages because there was no probable cause for the accusation that she had stolen his rings, luggage and other personal items that she claimed he had given her.
DeLaurentis, supra, 220 Conn. at 255.
Applying the logic of the above-described decisions to the facts before it, the DeLaurentis Court first divided all the allegations made against the defendant into four discrete groups, "each containing factual allegations with respect to different times, occurrences and actions." CT Page 8937 Id. "Each group of allegations," it declared, "amounts to a separate `charge' to which DeLaurentis[, the vexatious suit plaintiff,] was required to respond." id. Upon concluding that there was in fact probable cause to pursue the plaintiff in the underlying proceeding on two of the four groups of related factual allegations or "charges," the Court upheld the jury's finding of vexatious suit liability on the basis of the two groundless charges because they were logically severable from the others, but remanded the case for a new trial on damages only for the plaintiff to prove what particular damages he sustained due the prosecution of those groundless charges. Id. at 256.
The DeLaurentis Court's analysis of the reasons why the prosecution of groundless claims is actionable under the vexatious suit statute even when proper claims are simultaneously presented in the same action or proceeding is very instructive on the issues now before this Court for decision in several ways. First, the Court's conclusion that the prosecution of a groundless claim supports a vexatious suit action even though the groundless claim was brought in the same underlying action or proceeding as one or more proper claims from which it was logically severable is based upon the premise that the addition of such a claim to any action predictably causes special harm of the sort that a vexatious suit claim is intended to remedy. The inclusion of one or more groundless claims in an otherwise proper action or proceeding will unnecessarily complicate the action or proceeding, prejudicially alter the process and increase the cost and effort required to defend it, and cause added anxiety due to delay, strain on financial resources and public obloquy associated with the groundless claims and accusations. These concerns, it would clearly seem, would justify the bringing of a vexatious suit claim based upon the pursuit of groundless claims even if — indeed, especially if — the underlying action or proceeding led to a judgment for the underlying plaintiff on one or more of his proper claims. Surely, in that instance, suspicion would be warranted that one reason for the plaintiff's partial success was the wearing down of his opponent by the piling on of groundless claims or charges.
Second, the DeLaurentis Court overtly signaled the applicability of its analysis to underlying actions in which the underlying defendant prevailed on a groundless claim while the underlying plaintiff prevailed on other, logically severable claims, by citing and relying on such cases as illustrations of proper procedure. Thus, both, Janetka v. Dabe, supra, and Singleton v. Perry, supra, two malicious prosecution cases which the Court described as "enlightening" as to how the rule should work, involved underlying criminal prosecutions in which the malicious prosecution plaintiff, then a criminal defendant, had been acquitted of one charge but convicted of another. In Janetka, the Second Count reversed the dismissal of the plaintiff's malicious prosecution claim and permitted it to proceed to trial because the two charges he had faced in the underlying prosecution were "distinct offenses involving distinct allegations . . . The elements of each charge are different; neither charge is a lesser included offense of the other." DeLaurentis, supra, 220 Conn. at 254 (quoting Janetka, supra, 892 F.2d at 190)). Similarly, in Singleton, as described with approval in DeLaurentis, the court sustained the jury's verdict finding probable cause for a change in the criminal complaint that the plaintiff had stolen the complainant's radio, but awarding damages because there was no probable cause for the accusation that she had stolen his rings, luggage and other personal items that she claimed he had given her.
Id. at 255.
Beyond these examples from the criminal arena, arising in the analogous context of malicious prosecution actions, the DeLaurentis Court cited with approval, though did not describe, three cases that used the same analysis in the civil context. Not by accident, each of those cases involved an underlying civil action in which a defendant who had lost on certain claims against him but prevailed on other, separate and distinct claims was permitted to sue for vexatious suit based upon his opponent's groundless prosecution of the latter claims. In one of those cases, Paramount General Hospital Co. v. Jay, supra, the California Court of Appeals for the Second District reversed the order of the trial court, which had dismissed a claim for malicious prosecution because 2 of 18 severable issues in the underlying civil action had been decided favorably to underlying plaintiff/malicious prosecution defendant. In reaching this result, the Court cited Singleton, supra for the proposition that:
In order to maintain an action for malicious prosecution, "it is not necessary that the whole proceeding be utterly groundless, for, if groundless charges are maliciously and without probable cause, coupled with others which are well founded, they are not on that account the less injurious, and, therefore, constitute a valid cause of action." [¶] . . . [¶] Indeed, it would seem almost a mockery to hold that by uniting groundless accusations with those for which probable cause might exist, the defendants could thereby escape liability, because of the injured party's inability to divide his damages between the two with delicate nicety.
(Italics added.) Paramount General Hospital Co., supra, 213 Cal.App.3d at 368 (quoting Singleton, supra, 45 Cal.2d at 497-98). So stating, the Paramount Court concluded that:
there is no reason for permitting plaintiffs to pursue "shotgun tactics" by proceeding on counts and theories which they know or should know to be groundless [citation omitted]. A malicious prosecution action following a partial favorable termination of a severable underlying action . . . reasonably accommodates these competing policies.
Id. at 372.
In March v. Cacioppo, supra, another case arising in the civil context which the DeLaurentis Court cited with approval, the Illinois Appellate Court for the First District employed the same analysis used in Paramount, Janetka and Singleton to uphold a plaintiff's right to sue for malicious prosecution even though he had not prevailed on each and every claim made against him in the underlying action. There, in a fact situation remarkably similar to that presented in this case, a landlord had sued a tenant to recover two distinct sums of money: first, past due rent of $175 for the month of November 1960; and second, future rent for the months of December 1960 through May 1961, which the landlord claimed he could accelerate because the tenant was about to vacate the apartment, which he had rented through May. Initially, when the tenant failed to appear, the landlord obtained a judgment against him on both claims and proceeded to garnish the tenant's bank account in the amount of the judgment. Later, however, the tenant appeared in the action and successfully moved as follows: first, to reduce the amount of the judgment to the amount of his November rent plus $33.75 in attorneys fees and costs because, inter alia, he had never signed his lease and it contained no acceleration clause, and thus there was no basis for the landlord's claim for future rent; and second, to open the new and lesser judgment of $175 plus attorneys fees and costs so that he could defend it on the claim that he owed the landlord nothing because of their agreement that he would vacate the premises by November 30 and the landlord would retain his $175 security deposit as his November rent. Before the reopened claim for November rent came to trial, the tenant filed a malicious prosecution action against the landlord for obtaining the larger judgment for rent in futuro and garnishing his bank account in that amount. The landlord and his attorneys, who had helped him to obtain the judgment and garnish the tenant's bank account, successfully demurred to the tenant's malicious prosecution claim on the ground that part of the underlying action remained open, and thus that the entire action had not terminated favorably to the tenant.
The March Court reversed the trial court's ruling sustaining of the demurrer and reinstated the tenant's action for the following reasons:
The suit, under the factual situation prevailing, is divisible into two parts: the rent for the month of November and the rent for the following six months. The former is still in controversy; the latter has been resolved. It would not be just to hold that the defendants must be absolved from liability simply because a small part of their suit might end in judgment for them, when the far longer part, the equivalent of a separate claim, has been decided against them, and when there is reason to believe that this separate claim was prosecuted with malice and without probable cause.
Id. at 245-46.
Against the background of the above-described decisions, as featured and relied upon in DeLaurentis, this Court concludes that in Connecticut, the favorable termination of one or more groundless claims against a defendant in an underlying civil action will support a valid and sufficient claim for vexatious suit even though other, logically severable claims made against him in that action did not terminate favorably to him. Here, then, the defendants' Motion for Summary Judgment must be denied unless, on the evidence presented, the claim which terminated favorably to the Buyers is not logically severable from the claim which did not.
This, in fact, is the third way in which the DeLaurentis decision is of special significance in this case, for there the Court spent considerable time and energy discussing the issue of logical severability in the civil context. There, to reiterate, the Court relied expressly upon the cases just discussed — Janetka, Singleton, Paramount and March — to shed light on what logically severable claim was for the purposes of a civil action. From Janetka, it borrowed the concept that separate legal claims involving different legal elements, none of which was a lesser included offense of the other, are logically severable. From Singleton, it borrowed the concept that even claims involving the same legal elements are logically severable if they relate to separate incidents, actions or objects. Accord, Paramount, supra, 213 Cal.App.3d at 370 (rejecting the argument that multiple acts of wrongdoing were not logically severable from one another merely because each was claimed to have been a breach of fiduciary duty); and March, supra, 37 Ill. App.2d at 245-46 (finding that two alleged breaches of the same contract — one for alleged failure to pay past rent, the other for alleged breaking of the lease before its term was over — were separate claims which, if terminated favorably to the underlying defendant, could later serve as the basis for a valid claim of malicious prosecution).
Applying these authorities to the facts before it, the DeLaurentis Court subdivided the claims in the underlying proceeding there at issue into four separate groups, each of which was held to be logically severable from the others because it "contain[ed] factual allegations with respect to different times, occurrences and actions." "Each group of allegations," observed the Court, "amount[ed] to a separate `charge' to which DeLaurentis was required to respond." Id. at 255.
E. Whether the Two Claims Made in the Underlying Action Were Logically Severable from One Another
Applying the logical severability analysis from DeLaurentis to the underlying claims at issue in this case, this Court finds that the two claims are logically severable, and thus that a vexatious suit claim can properly be based upon the favorable termination of one such claim in the same action as the other was terminated unfavorably. The Buyers' claim that the Buyers owed them $8,407 for fuel oil sold to retained customers prior to the audit, which went to judgment for the Sellers in the underlying action, was completely distinct and separate from the claim that the Sellers were entitled to the difference between anticipated payments based on expected sales of fuel oil to such customers at pre-sale levels and projected payments from such sales based upon actual sales to date, which terminated favorably for the Buyers. Although both claims sounded in breach of contract, the former was based upon the Buyers' alleged (and admitted) failure to pay for sales of fuel oil actually made to retained customers, whereas the latter was based upon the Buyers' alleged failure to maintain the volume of fuel oil sales to such customers at pre-sale levels so as to guarantee them payments in expected amounts. Like the two breaches alleged in the March case — one for past due rent and the other for future rent for the duration of a rental agreement, accelerated due to the impending termination of the agreement — these two claims were logically severable from one another in the sense that they arose from different alleged promises, sought different recoveries, and were based upon different allegations of fact. The Court must therefore deny the favorable termination portion of the defendant's Motion for Summary Judgment insofar as it challenges the Buyers' right to proceed against him on the claim of vexatious suit based upon the Sellers' prosecution of their second claim against him in the underlying action.
F. Conclusion
Having concluded as a matter of law that the two claims made by the Sellers in the underlying action were logically severable from one another, and that the Buyers can lawfully maintain this vexatious suit action against the Sellers based upon the favorable termination of one such claim despite the unfavorable termination of the other, the Court must sever the Buyers' present claim, enter summary judgment for defendant Morrocco, under Practice Book § 17-51, on that portion of the claim which is based upon the Sellers' successful prosecution of their pre-audit deficiency claim, but deny the defendant's Motion insofar as it challenges the Buyers' right to proceed against him on the basis of the Sellers' unsuccessful prosecution of their other, larger claim.
III. DEFENDANT MORROCCO'S MOTION — NOERR-PENNINGTON
Defendant Morrocco's second claim on his Motion For Summary Judgment is that the Buyers' claim against him is barred by the Noerr-Pennington doctrine because, as alleged in his Second Special Defense, the alleged acts that form the basis of the Buyers' claim against him "consisted of petitioning activity aimed at procuring favorable governmental action or judicial redress." Answer and Special Defenses (of Defendant Alfred F. Morrocco, Jr.) (8/31/01) ("Morrocco Answer and Special Defenses"), p. 3. The Buyers flatly disagree, contending that the Noerr-Pennington doctrine has no application to the commencement and prosecution of an ordinary civil lawsuit like the underlying action, which did not involve petitioning the government or the exercise of protected constitutional rights. For the following reasons, the Court agrees with the Buyers that the Noerr-Pennington doctrine has no application to this case.
As explained by our Appellate Court in Zeller v. Consolini, 59 Conn. App. 545, 550-54, 758 A.2d 376 (2000), the doctrine was based initially on a trio of federal antitrust cases, California Motor Transport Co. v. Trucking Unlimited, 404 U.S. 508, 92 S.Ct. 609, 30 L.Ed.2d 642 (1972); United Mine Workers v. Pennington, 381 U.S. 657, 85 S.Ct. 1585, 14 L.Ed.2d 626 (1965); Eastern Railroad Presidents Conference v. Noerr Motor Freight, Inc., 365 U.S. 127, 81 S.Ct. 523, 5 L.Ed.2d 464 (1961); and their progeny, collectively referred to as the Noerr-Pennington doctrine. In short, the Noerr-Pennington doctrine "shields from the Sherman Act [ 15 U.S.C. § 1 et seq.] a concerted effort to influence public officials regardless of intent or purpose." United Mine Workers v. Pennington, supra, 670. The United States Supreme Court has reasoned that "it would be destructive of rights of association and of petition to hold that groups with common interests may not, without violating the antitrust laws, use the channels and procedures of state and federal agencies and courts to advocate their causes and points of view respecting resolution of their business and economic interests vis-a-vis their competitors." California Motor Transport Co. v. Trucking Unlimited, supra, 510-11.
The Noerr-Pennington doctrine has evolved from its antitrust origins to apply to a myriad of situations in which it shields individuals from liability for petitioning a governmental entity for redress. "[A]lthough the Noerr-Pennington defense is most often asserted against antitrust claims, it is equally applicable to many types of claims which seek to assign liability on the basis of the defendant's exercise of its first amendment rights." (Internal quotation marks omitted.) Central Telecommunications, Inc. v. TCI Cablevision, Inc., 800 F.2d 711, 717 n. 7 (8th Cir. 1986), cert. denied, 480 U.S. 910, 107 S.Ct. 1358, 94 L.Ed.2d 528 (1987). For example, Noerr-Pennington has been recognized as a defense to actions brought under the National Labor Relations Act, 29 U.S.C. § 151 et seq.; Bill Johnson's Restaurants, Inc. v. National Labor Relations Board, 461 U.S. 731, 741, 103 S.Ct. 2161, 76 L.Ed.2d 277 (1983); state law claims of tortious interference with business relations; NAACP v. Claiborne Hardware Co., 458 U.S. 886, 913-15, 102 S.Ct. 3409, 73 L.Ed.2d 1215 (1982); federal securities laws; Havoco of America Ltd. v. Hollowbow, 702 F.2d 643, 650 (7th Cir. 1983); and state wrongful discharge claims. San Filipo v. Bongiovanni, 30 F.3d 424, 438-43 (3d Cir. 1994), cert. denied, 513 U.S 1082, 115 S.Ct. 735, 130 L.Ed.2d 638 (1995).
Although the Noerr-Pennington doctrine provides broad coverage to petitioning individuals or groups, its protection is not limitless. In Eastern Railroad Presidents Conference v. Noerr Motor Freight, Inc., supra, 365 U.S. 144, the United States Supreme Court, albeit in dictum, established a "sham exception" to the general rule, stating: "There may be situations in which a publicity campaign, ostensibly directed toward influencing governmental action, is a mere sham to cover what is actually nothing more than an attempt to interfere directly with the business relationships of a competitor and the application of the Sherman Act would be justified." Id. In short, petitioning activity is not protected if such activity is a mere sham or pretense to interfere with no reasonable expectation of obtaining a favorable ruling. See Litton Systems, Inc. v. American Telephone Telegraph Co., 700 F.2d 785, 809-12 (2d Cir. 1983), cert. denied, 464 U.S. 1073, 104 S.Ct. 984, 79 L.Ed.2d 220 (1984). In Professional Real Estate Investors, Inc. v. Columbia Pictures Industries, Inc., 508 U.S. 49, 60-62, 113 S.Ct. 1920, 123 L.Ed.2d 611 (1993), the court outlined a two part test to define sham litigation. First, the lawsuit must be objectively baseless in the sense that no reasonable litigant could realistically expect success on the merits. Id., 60. Second, "the court should focus on whether the baseless lawsuit conceals an attempt to interfere directly with the business relationships of a competitor . . . through the use [of] the governmental process — as opposed to the outcome of that process as an anticompetitive weapon . . ." (Citations omitted; internal quotation marks omitted.) Id., 60-61. Essentially, then, a sham involves a defendant whose activities are not genuinely aimed at procuring favorable governmental action in any form. Video International Production, Inc. v. Warner-Amex Cable Communications, Inc., 858 F.2d 1075, 1082 (5th Cir. 1988), cert. denied, 490 U.S. 1047, 109 S.Ct. 1955, 104 L.Ed.2d 424 (1989)
Zeller v. Consolini, supra, 59 Conn. App. at 551-52.
So explaining the purposes and operation of the doctrine and its "sham litigation" exception, the Zeller Court adopted them for use in Connecticut for the following reasons:
many of our own trial courts have applied the Noerr-Pennington doctrine in their decisions. E.g., Roncari Development Co. v. GMG Enterprises, Inc., 45 Conn. Sup. 408, 414, 718 A.2d 1025, 19 Conn.L.Rptr. 237 (1997), citing Connecticut National Bank v. Mase, Superior Court, judicial district of Fairfield at Bridgeport, Docket No. 269180, 3 Conn.L.Rptr. 285 (January 31, 1991); Abrams v. Knowles, Superior Court, judicial district of New London at Norwich, Docket No. 95287 (December 4, 1990) ( 3 Conn.L.Rptr. 9); Yale University School of Medicine v. Wurtzel, Superior Court, judicial district of New Haven, Docket No. 275314 (November 9, 1990) ( 2 Conn.L.Rptr. 813).
In addition, the United States Court of Appeals for the Second Circuit has predicted that Connecticut's appellate courts probably would apply the Noerr-Pennington doctrine and the accompanying sham exception when given the opportunity to do so. "We believe that Connecticut's courts would be guided by the strong suggestions from the federal courts that imposing liability for the act of filing a non-sham lawsuit would present serious constitutional problems, and would construe Connecticut law to avoid those problems. Especially since Noerr-Pennington's statutory exemption is defined in terms of first amendment activity, we are confident that Connecticut's courts would carve out a similar exception to [the Connecticut Unfair Trade Practices Act (CUTPA), General Statutes § 42-110a et seq.] and the common law, whether or not they believed that they were required to do so by the Constitution." Suburban Restoration Co. v. ACMAT Corp., 700 F.2d 98, 102 (2d Cir. 1983); see also T.F.T.F. Capital Corp. v. Marcus Dairy, Inc., 33 F. Sup.2d 122, 125-26 (D.Conn. 1998). We agree.
The Noerr-Pennington doctrine subordinates antitrust considerations and commercial expediency to the constitutional rights of individuals and groups to petition their government. Furthermore, failure to apply the Noerr-Penninnton doctrine aggressively may create a "chilling effect" on the first amendment right to petition in zoning and other matters. See Ottensmeyer v. Chesapeake Potomac Telephone Co., 756 F.2d 986, 993-94 (4th Cir. 1985). Indeed, such a chilling effect can be a virtual deep freeze when individual citizens not versed in the legal system and without financial resources do not exercise potentially meritorious legal challenges for fear of costly and protracted, retributive litigation from opponents.
The Noerr-Pennington doctrine is a well established body of law applicable to a wide variety of situations involving petitioning activity, including local zoning and other municipality matters. Seventeen years later, we fulfill the Second Circuit's prophecy and adopt the Noerr-Pennington doctrine and its accompanying sham exception as the applicable analysis for cases such as this one. [Footnote omitted.]
Zeller v. Consolini, supra, 59 Conn. App. at 552-54.
Finally, the Zeller Court applied the doctrine to the case before it, where the plaintiff was suing the defendant for vexatious suit based upon the latter's unsuccessful application for a zoning change and commencement and prosecution of several unsuccessful zoning appeals affecting the plaintiff's property. The doctrine was ruled applicable to the plaintiff's action because the underlying conduct there complained of clearly constituted "petitioning activity directed at local government." Id. at 552. Moreover, on the facts presented to the trial court on the defendant's motion for summary judgment, there was no genuine issue of material fact that such conduct was not "objectively baseless" and thus did not fall within the "sham exception" to the doctrine. Id. at 555.
The instant case, unlike the action at issue in Zeller, does not involve a claim for damages against the defendant Sellers for engaging in "petitioning activity directed at local government," or for any other conduct involving the assertion or protection of "the constitutional rights of individuals and groups to petition their government." Id. at 552-53. Instead, as the Buyers rightly argue, it is based solely upon the allegedly groundless prosecution of purely private claims between commercial parties arising out of and relating to a Sales and Purchase Agreement between them. Therefore, since the prosecution of this case does not threaten to chill the Sellers, including defendant Morocco, in the exercise of their right to petition the government for any purpose or to engage in any other constitutionally protected activity, the Noerr-Pennington doctrine has absolutely no application hereto.
Even, moreover, if the Noerr-Pennington doctrine could somehow be read to apply to the prosecution of every civil lawsuit, on the theory that access to the courts is constitutionally guaranteed, even for the assertion of purely private claims, the Court would have no basis, on the record before it, for concluding that the doctrine bars this action as a matter of law. This is so because the evidence before the Court raises a genuine issue of material fact as to whether the Sellers' underlying claims were objectively baseless, and thus within the "sham exception" to the doctrine. Here, in particular, there is evidence that the Sellers' claim for the difference between anticipated total payments in the three-year period after selling their business to the Buyers, based upon expected sales of fuel oil to retained customers at pre-sale levels, and projected actual payments during that period based upon actual sales of fuel oil to such customers to date, was totally unsupported by the language of the parties' Sales and Purchase Agreement. It having been decided in the underlying action that this claim was without merit, based upon the language of Sales and Purchase Agreement, this Court has no basis for finding, as a matter of law, that that claim was commenced and prosecuted with probable cause. Therefore, even if Noerr-Pennington applied to this case, which it does not, a genuine issue of material fact exists as to the applicability of the "sham exception" to the Sellers' conduct, thus requiring the denial of this second aspect of defendant Morrocco's Motion For Summary Judgment.
V. CONCLUSION
For all of the foregoing reasons, the Court hereby concludes: (1) that the Buyers' Motion For Summary Judgment must be DENIED in its entirety; and (2) that defendant Morrocco's Motion For Summary Judgment must be GRANTED, on the issue of favorable termination, as to that portion of the Buyers' vexatious suit claim that is based upon the Sellers' successful prosecution of their pre-audit payment deficiency claim in the underlying action, but DENIED, on the issue of favorable termination, as to that portion of the Buyers' vexatious suit claim that is based upon the Sellers' unsuccessful prosecution of a different, logically severable claim in the underlying action, and DENIED in its entirety on the defendant's claim of immunity under the Noerr-Pennington doctrine.
IT IS SO ORDERED this 1st day of August 2003.
Michael R. Sheldon, J.