Opinion
C. A. 2:17-cv-1274-BHH-MHC
12-31-2021
Stephen Rice, Plaintiff, v. M-E-C Company, Reuben Andreas, John Beman Andreas, and Amanda Fisk, Defendants.
REPORT AND RECOMMENDATION
MOLLY H. CHERRY, United States Magistrate Judge.
Plaintiff brings this action, alleging various state law claims against pro se Defendant John Andreas. ECF No. 86. Before the Court is Defendant John Andreas's Motion for Summary Judgment, ECF No. 226 (“Motion”). Plaintiff filed a Response in Opposition, ECF No 230. The deadline for Defendant Andreas to file a Reply has passed, and the Motion is ripe for review.
After counsel was relieved in December of 2019, Defendant Andreas has proceeded pro se in this litigation. ECF No. 153.
It is unclear whether Plaintiff's Response has been served on Defendant Andreas. The certificate of service attached to Plaintiff's Response indicates that it was served on “Amanda Fisk.” ECF No. 230 at 18. Because no new issues were raised in Plaintiff's Response and replies to responses are discouraged in this District, Local Rule 7.07 (D.S.C.), the undersigned has addressed the merits of Defendant's Motion. However, to the extent Plaintiff did not serve a copy of his Response on Defendant Andreas, Plaintiff is directed to do so and to file a corrected certificate of service with the Court within ten days of the date of this Report and Recommendation.
All pretrial proceedings in this case were referred to the undersigned United States Magistrate Judge pursuant to the provisions of 28 U.S.C. § 636(b)(1)(A) and (B) and Local Civil Rule 73.02(B)(2)(e) (D.S.C.). This Report and Recommendation is entered for review by the District Judge. For the reasons set forth below, the undersigned recommends that the Motion be granted.
PROCEDURAL HISTORY
Plaintiff filed a Complaint with the Charleston County Court of Common Pleas in March of 2017, which Defendants removed to this Court on May 17, 2017. ECF No. 1. Plaintiff subsequently filed an Amended Complaint, asserting causes of action for Wrongful Retention of Wages (First Cause of Action) against M-E-C Company (“M-E-C”), Lynn Ann Lichtenfeld, Pamela Walden, Michael Hudson, Jacob Johnston, John and Amanda Fisk, Joan K. Parker, Steven D. Parker and W. Kent Shields; Breach of Contract, Breach of Contract with Fraudulent Intent and Detrimental Reliance (Second Cause of Action) against all Defendants; Conversion (Third Cause of Action) against M-E-C, Lynn Ann Lichtenfeld, Pamela Walden, Michael Hudson, Jacob Johnston, John and Amanda Fisk, Joan K. Parker, Rueben Andreas, Stephen D. Parker, John Quick, Jr., and W. Kent Shields; violations of the Employee Retirement Income Security Act (“ERISA”) (Fourth Cause of Action) against M-E-C; Slander (Fifth Cause of Action) against all Defendants; Wrongful Termination in Violation of Public Policy (Sixth Cause of Action) against M-E-C, Lynn Ann Lichtenfeld, Pamela Walden, Michael Hudson, Jacob Johnston, John and Amanda Fisk, Rueben Andreas, Joan K. Parker, Stephen D. Parker, and W. Kent Shields; Civil Conspiracy (Seventh Cause of Action) and Intentional Infliction of Emotional Distress (Eighth Cause of Action), both against Amanda Fisk and Lynn Ann Lichtenfeld. ECF No. 86.
The purpose of the amendment was to “correct the name of Amanda Andreas to Amanda Fisk” as ordered by the Court on October 20, 2017. ECF No. 89.
Plaintiff's Amended Complaint references “John and Amanda Fisk, ” which the Court interprets as John Andreas and Amanda Fisk, based upon the name correction identified in footnote 2 and the causes of action against Defendant John Andreas that are addressed by Plaintiff in his Response, ECF No. 230.
Although Plaintiff originally asserted an ERISA claim against “all Defendants, ” the claim is only against Defendant M-E-C, see ECF No. 108, and Plaintiff has not included any argument in his Response to the Motion for Summary Judgment regarding an ERISA claim against Defendant Andreas. See ECF No. 230.
Almost all Defendants have been dismissed from this action except Defendants M-E-C and Reuben Andreas, each of whom has defaulted (ECF Nos. 62 and 63), and Defendants John Andreas and Amanda Fisk. ECF Nos. 78, 189.
Defendants John Andreas (“Andreas”) and Amanda Fisk (“Fisk”) filed a Motion to Dismiss for lack of jurisdiction, which the Court denied without prejudice on October 25, 2017. ECF No. 78. On March 27, 2019, they filed their first Motion for Summary Judgment for lack of jurisdiction, pursuant to Rules 56 and 12(b)(2) of the Federal Rules of Civil Procedure. ECF No. 134. The Court denied the first Motion for Summary Judgment on March 11, 2020, without prejudice. ECF Nos. 162, 179.
On November 19, 2019, the Court entered an Amended Scheduling Order for the case, with a deadline of February 14, 2020, for all dispositive motions. ECF No. 150. On June 25, 2021, the Court set a trial date of January 12, 2022, for Plaintiff's case against Defendants Andreas and Fisk. ECF No. 209. The Court also entered a text order requiring Defendants Andreas and Fisk to file, within 60 days, a notice indicating whether they intend to hire counsel or proceed pro se at trial. ECF No. 210. In that order, the Court indicated these Defendants would have an opportunity to raise any additional issues that needed resolution prior to trial. Id.
On August 20, 2021, Defendant Andreas filed a one page letter, dated August 15, 2021, requesting to be dismissed from the case (“Motion for Summary Judgment”), asserting there is no evidence to show he was involved in Plaintiff's termination from M-E-C Company or otherwise supporting Plaintiff's allegations against him. ECF No. 226. Plaintiff filed a Response in Opposition to the Motion. ECF No. 230.
In light of discovery having been conducted in the case, Defendant Andreas's pro se status, his reference to evidence outside of the pleadings and Plaintiff's arguments in the Response, the undersigned interprets Defendant Andreas's letter as seeking summary judgment pursuant to Rule 56 of the Federal Rules of Civil Procedure. See Hathaway v. Owen, Civil Action No. 4:07-cv-03520-TLW-TER, 2009 WL 425894, *3 (D.S.C. Feb. 17, 2009) (noting that court must liberally construe pleadings filed by pro se litigants).
BACKGROUND
This action arises out of a dispute over wages and benefits allegedly owed to Plaintiff Stephen Rice. Plaintiff started work for M-E-C on September 1, 2012, as Vice President of Sales in Oklahoma. (ECF No. 230-1 at 12-13, 20; Plaintiff's Depo., pp. 19-20, 33). Plaintiff later became the Chief Operating Officer (“COO”), and his salary was increased to approximately $150,000 - $160,000 per year plus commissions. (Id. at 14-18; Plaintiff's Depo., pp. 21-25).
Plaintiff eventually relocated to Charleston, South Carolina, where M-E-C had opened an office. (ECF No. 230-1 at 40-41; Plaintiff's Depo., pp. 66-67). In May of 2016, John Quick (“Quick”), who was M-E-C's president at the time and had relocated with Plaintiff to Charleston, told Plaintiff that he was resigning and recommending that Plaintiff take his place. (ECF No. 230-1 at 12-13, 24; Plaintiff's Depo. pp. 19-20, 40). Plaintiff was concerned about some financial information that Quick submitted to the board with his resignation letter, as Plaintiff did not believe this information accurately reflected the company's financial situation. (ECF No. 230-1 at 24, 25; Plaintiff's Depo., pp. 41, 43).
Within a day or so of Quick's submission of his resignation letter, Plaintiff was contacted by Fisk, who Plaintiff indicated was one of the “owners/board members. Far as I know she's the wife of [Defendant] John Andreas is how she represented herself.” (ECF No. 230-1 at 28; Plaintiff's Depo., p. 47). Plaintiff argues in his Response that Defendant Fisk informed him that Defendant Andreas was a “member of the board” of M-E-C. ECF No. 230 at 11, ¶ 9; see also ECF No. 230-2 at 4-8. Defendant Andreas previously provided testimony confirming that he served as an unpaid member of the board of directors for M-E-C from December 2014 to May 2016. ECF No. 134-2 at ¶¶ 5, 7.
Plaintiff emailed Fisk a copy of an earlier email he had sent to Quick with his financial concerns, after which Fisk called Plaintiff to discuss the condition of M-E-C. (ECF No. 230-1 at 29-30; Plaintiff's Depo., pp. 48-49.)
Lynn Ann Lichtenfeld (“Lichtenfeld”) and Fisk came to South Carolina on May 9, 2016, and represented to Plaintiff they were there as owners and board members of M-E-C. (ECF No. 230-1 at 46-47; Plaintiff's Depo., pp. 76-77). They met with Plaintiff, and he explained the financial and other challenges facing the company. (ECF No. 230-1 at 33-37; Plaintiff's Depo., pp. 52-56). After a break in their meeting, during which Plaintiff understood there was a telephonic board meeting, Lichtenfeld went to Quick's office and fired him and two other employees who were relatives of Quick. (Id.) Lichtenfeld and Fisk then asked Plaintiff to consider staying with the company and also asked him about the possibility of selling the company. (ECF No. 230-1 at 37- 39; Plaintiff's Depo., pp. 56-58). Plaintiff told them he would consider any options, but not without an infusion of cash into the company. (Id.) Plaintiff did not believe that there were any time constraints and planned to meet with Lichtenfeld and Fisk again on May 10, , 2016, after he returned from a business meeting out of town. (Id.) However, before he returned, Plaintiff's phone and email were turned off. (Id.) The locks on the office were changed, and he never spoke with Lichtenfeld or Fisk again. (Id.)
Plaintiff later explained in his deposition that he did not know if any of the board and ownership representations made by Lichtenfeld were applicable to Fisk. (ECF No. 230-1 at 49; Plaintiff's Depo., p. 79). In an affidavit filed earlier in this case, Fisk attested that she was never a board member of, nor employed by, M-E-C. (ECF No. 134-3, ¶¶ 6-7). In his Response, Plaintiff argues “[a]t all times Fisk was operating as the representative of her husband and stood in the shoes of her husband.” ECF No. 230 at 10, ¶ 6; see also Id. at 11, ¶ 9.
Plaintiff's telephone calls to Lichtenfeld went unanswered, but he did have email correspondence with her. (Id.) Plaintiff believed that M-E-C subsequently quit operating, but was not aware of the details surrounding its closure. (Id.) Prior to Lichtenfeld's involvement in May of 2016, M-E-C had not been paying Plaintiff. According to Plaintiff, Quick made the decisions about who was going to be paid, and what was going to be paid on behalf of the company, until Quick's termination, after which point Lichtenfeld made those decisions. (ECF No. 230-1 at 51; Plaintiff's Depo., p. 87).
LEGAL STANDARD
Summary judgment should be granted when “there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). “Facts are ‘material' when they might affect the outcome of the case, and a ‘genuine issue' exists when the evidence would allow a reasonable jury to return a verdict for the nonmoving party.” The News & Observer Publ'g Co. v. Raleigh-Durham Airport Auth., 597 F.3d 570, 576 (4th Cir. 2010) (citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986)). In ruling on a motion for summary judgment, “the nonmoving party's evidence is to be believed, and all justifiable inferences are to be drawn in that party's favor.” See Id. (quoting Hunt v. Cromartie, 526 U.S. 541, 552 (1999)). However, “the nonmoving party must rely on more than conclusory allegations, mere speculation, the building of one inference upon another, or the mere existence of a scintilla of evidence.” Dash v. Mayweather, 731 F.3d 303, 311 (4th Cir. 2013). When a party fails to establish the existence of an element essential to that party's case, there is no genuine issue of material fact and the movant is entitled to a judgment as a matter of law. Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986); see also Teamsters Joint Council No. 83 v. Centra, Inc., 947 F.2d 115, 119 (4th Cir. 1991) (“[W]here the record taken as a whole could not lead a rational trier of fact to find for the non-moving party, disposition by summary judgment is appropriate.”).
DISCUSSION
Plaintiff first argues that Defendant Andreas “has presented no evidence under oath or any evidence whatsoever regarding his role in the employment and termination of the Plaintiff” and has “failed to meet the burden of proof regarding summary judgment.” ECF No. 230 at 1, 2. However, Defendant Andreas is not required to put forth evidence to prove he is entitled to summary judgment. Instead, Plaintiff has the burden of proving each of his claims against Defendant Andreas. Defendant Andreas has moved for summary judgment, arguing Plaintiff has no evidence to establish the claims against him. ECF No. 226.
Plaintiff also argues that Defendant's Motion, filed on August 20, 2021, is untimely, in light of the February 14, 2020 deadline for dispositive motions set forth in the last Amended Scheduling Order. ECF Nos. 230 at 2. As part of the administration of this case, however, the Court issued a text order informing Defendant Andreas that he would have an opportunity to raise any additional issues that needed resolution prior to trial, which has been scheduled for January 12, 2022. ECF Nos. 209, 210. Given that the order suggests additional motions will be entertained and the current Motion for Summary Judgment was filed at least five and a half months prior to trial, consideration of Defendant's Motion is in the interest of judicial economy and efficiency for the parties and the Court. See, e.g., Synovus Bank v. Stevens L. Firm, No. 4:19-CV-01411-SAL, 2020 WL 6384653, at *1 n.1 (D.S.C. Oct. 30, 2020); Malone v. Greenville Cty., No. 6:06-cv-2631-RBH, 2008 WL 1438221, at *2 (D.S.C. Apr. 10, 2018) (denying motion to strike late-filed motion for summary judgment where it was in the interest of judicial economy to consider it).
For the foregoing reasons, it is appropriate to consider the merits of Defendant's Motion for Summary Judgment. To that end, Plaintiff has clarified that he is not asserting a claim for wrongful termination against Defendant Andreas. See ECF No. 230 at 17. Accordingly, the undersigned recommends granting Defendant's Motion for Summary Judgment as to that claim.
Plaintiff also suggests that the arguments asserted by Defendant Andreas in his first Motion for Summary Judgment, ECF No. 134, are the same arguments asserted in the current Motion, ECF No. 226, such that they should be barred. ECF No. 230 at 3-4. However, Defendant Andreas's first Motion for Summary Judgment was based upon jurisdictional arguments and, in any event, was denied without prejudice. ECF Nos. 162, 179. Defendant Andreas is not precluded from bringing this second Motion for Summary Judgment.
As to the remaining four claims asserted by Plaintiff against Defendant Andreas, Plaintiff contends that there is a “genuine issue of material fact as to Ms. Fisk's involvement in the termination of [Plaintiff], as a representative of her husband the Defendant, John Andreas.” ECF No. 230 at 12. These claims are addressed below.
The undersigned recommended granting Defendant Fisk's Motion for Summary Judgment. ECF No. 219. To the extent Plaintiff's claims against Defendant Andreas are premised upon a finding of liability as to Defendant Fisk, Plaintiff's claims against Defendant Andreas fail for all of the reasons set forth in the Report and Recommendation. In light of Defendant Andreas's role as a board member of M-E-C and the argument that Fisk was his representative in that capacity, however, the undersigned has addressed the substance of each of Plaintiff's claims against Defendant Andreas.
A. First Cause of Action: Wrongful Retention of Wages
Plaintiff has asserted a claim under the South Carolina Payment of Wages Act (“SCPWA”), which creates a cause of action against an employer by an employee for failure of the employer to pay wages as required under the Act. S.C. Code Ann. § 41-10-80(C). Plaintiff claims that Defendant Andreas violated the SCPWA by failing to pay him salaried wages, commissions from December 2015 to his termination, and 401(k) contributions. ECF No. 86 at ¶ 60.
The SCPWA provides that employers “shall pay all wages due to the employee within forty-eight hours of the time of separation or the next regular pay day which may not exceed thirty days.” S.C. Code Ann. § 41-10-50. Defendant Andreas contends that M-E-C was Plaintiff's employer, not him personally, such that he should not be liable to Plaintiff. However, the statute defines an “employer” as:
every person, firm, partnership, association, corporation, receiver, or other officer of a court of this State, the State or any political subdivision thereof, and any agent or officer of the above classes employing any person in this State.
S.C. Code Ann. § 41-10-10(1). Individuals who knowingly permit their corporation to violate the SCPWA may be liable. See, e.g., Allen v. Pinnacle Healthcare Sys., LLC, 715 S.E.2d 362, 364-65 (S.C. Ct. App. 2011) (citing Dumas v. InfoSafe Corp., 463 S.E.2d 641, 645 (S.C. Ct. App. 1995)); Wired Fox Techs., Inc. v. Estep, No. 6:15-331-BHH, 2017 WL 1135288, at *19 (D.S.C. Mar. 27, 2017) (“The statute was ‘intended to impose individual liability on agents and officers of a corporation who knowingly permit their corporation to violate the Act.'”).
Although there is no evidence before the Court that Defendant Andreas was a stockholder in M-E-C, it is undisputed that Defendant Andreas was a board member of M-E-C, Plaintiff's employer, during the relevant time period. See ECF No. 134-2 at ¶¶ 5, 7. Plaintiff contends that Fisk represented to him that she was operating “as a representative of her husband, John Andreas” such that he should be permitted “to pierce the corporate veil for the actions of Defendants.” ECF No. 230 at 13.
Notably, the exhibits attached to Plaintiff's affidavit appear to list the M-E-C shareholders and suggest, in fact, that Defendant Andreas was not a shareholder. ECF No. 230-2 at 7-8.
In support of this argument, Plaintiff cites to the following language regarding piercing the corporate veil:
The court in Sturkie adopted a two-prong test for piercing the corporate veil. The first prong is an eight factor analysis of the shareholder's relationship to the corporation and looks to the observance of the corporate formalities by the dominant shareholders. Cumberland Wood Prods. v. Bennett, 308 S.C. 268, 417 S.E.2d 617 (Ct.App.1992). The factors are:
(1) whether the corporation was grossly undercapitalized;
(2) failure to observe corporate formalities;
(3) non-payment of dividends;
(4) insolvency of the debtor corporation at the time;
(5) siphoning of funds of the corporation by the dominant stockholder;
(6) non-functioning of other officers or directors;
(7) absence of corporate records; and
(8) the fact that the corporation was merely a facade for the operations of the dominant stockholder. Id. The conclusion to disregard the corporate entity must involve a number of the eight factors, but need not involve them all. Id.
The second prong of Sturkie requires a plaintiff to prove “an element of injustice or fundamental unfairness if the acts of the corporation be not regarded as the acts of the individuals.” 280 S.C. at 457, 313 S.E.2d at 318 To prove fundamental unfairness, the plaintiff must establish that (1) the defendant was aware of the plaintiff's claim against the corporation, and (2) thereafter, the defendant acted in a self-serving manner with regard to the property of the corporation and in disregard of the plaintiff's claim in the property. Id.; Multimedia Publishing of S.C., Inc. v. Mullins, [314] S.C. [551, ] 431 S.E.2d 569 (1993). The essence of the fairness test is simply that an individual businessman cannot be allowed to hide from the normal consequences of carefree entrepreneuring by doing so through a corporate shell. Multimedia Publishing, [314] S.C. [551], 431 S.E.2d 569 (1993).
Under our own view of the record, we find sufficient evidence to pierce InfoSafe's corporate veil and hold Maguire individually liable to Dumas for unpaid wages. From its inception, InfoSafe was undercapitalized, failed to hold director's meetings, and did not pay dividends. InfoSafe could not pay the wages of its employees, was insolvent and did not keep adequate corporate records. InfoSafe funds were regularly transferred to Maguire and his wife, allegedly for repayment of certain loans to the company.
Maguire, InfoSafe's president indicated he made decisions regarding hiring employees. Maguire stated he put nearly $ 300, 000 of his own money into InfoSafe and described himself as an “entrepreneur.”
The trial court relied heavily upon the fact that Maguire did not perpetrate a fraud upon Dumas. However, for purposes of piercing the corporate veil, fundamental [***8] unfairness can exist in the absence of fraud, and may be proved by a lesser showing than reckless disregard. Multimedia Publishing, SC 431 S.E.2d 569 (1993). The record
contains an abundance of evidence that although Maguire was aware of Dumas's claims against InfoSafe, Maguire acted in a self-serving manner with regard to InfoSafe's funds available for unpaid salaries and in disregard of Dumas's claim to those funds.
For the reasons stated, we hold the evidence Dumas presented establishes the necessary elements for piercing the corporate veil. Accordingly, we reverse the trial court's ruling denying Dumas's request that Maguire be individually liable for the judgment against InfoSafe.
ECF No. 230 at 13-14 (citing Dumas v. InfoSafe Corp., 463 S.E.2d 641, 645 (S.C. Ct. App. 1995)).
In support of this theory of piercing the corporate veil, Plaintiff argues that Defendant Andreas “failed and refused to pay the Plaintiff when he was aware of what was owed and admits that the Plaintiff requested the pay. At the time that MEC was closed there was enough as testified to by the Plaintiff enough assets to pay what was owed to its employees.” Id. at 15. These facts alone, however, do not meet the Dumas standard for liability. There are no facts to show that Defendant Andreas played any role in the financial problems of M-E-C. Indeed, Plaintiff argues that “the condition of the company was the previous individuals in the Plaintiff's positions fault.”ECF No. 230 at 15.
Specifically, Plaintiff is referring to John Quick. He testifies in his affidavit that Quick was an owner/shareholder of M-E-C and, during the relevant time period, transferred company assets into his own personal name and wrote checks to himself at the time when he put a deposit on a house he purchased in Charleston. ECF No. 230-2 at ¶¶ 4, 7.
Plaintiff also argues that “Defendants as board members and a corporate entity” took the money from the assets of the company and failed and refused to pay Plaintiff. Id. Plaintiff asserts that Defendants made the decision not to pay him from the assets of the corporation such that they are “liable for their actions.” Id. At best, these statements by Plaintiff pertain to the fifth Dumas factor, i.e., siphoning of funds of the corporation by the dominant stockholder; however, Plaintiff has presented no evidence that Defendants Fisk or Andreas were stockholders in M-E-C, let alone dominant stockholders, nor that they siphoned off funds of the corporation. See notes 9 & 10, supra. Ultimately, Plaintiff has not presented any evidence that Defendant Andreas took assets or money from M-E-C or that it would be unjust or fundamentally unfair for Defendant Andreas not to be held personally responsible for the acts of M-E-C.
Of note, Plaintiff's theory of liability as to Defendant Andreas is directly related to Defendant Fisk, specifically that Fisk was acting on behalf of Andreas. Plaintiff's own evidence shows, however, that he had never spoken to Fisk before Quick's resignation and that she knew nothing of the company's dire financial situation until Plaintiff sent her a copy of the email he had previously sent to Quick. (ECF No. 230-1 at 26-30, 35-36, 45-47; Plaintiff's Depo., pp. 44, 46- 49, 54-55, 75-77.) Plaintiff himself testified that M-E-C had not been paying him and that he had received an eviction notice for M-E-C prior to his meeting with Fisk. (ECF No. 230-1 at 50; Plaintiff's Depo., p. 86). Plaintiff also testified that, up until Quick's termination, Quick was the one who made the decisions about who was going to be paid and what was going to be paid on behalf of the company, and that Quick was the one who was not taking care of certain things that directly affected the Plaintiff. (ECF No. 230-1 at 51; Plaintiff's Depo., p. 87).
Indeed, Plaintiff largely holds Quick responsible for taking money from the company and failing to pay him. See ECF No. 230-2. He attests that Quick “was directly responsible for not paying the Federal and State Withholding taxes [and 401-K funds] that had been withheld from [Plaintiff's] paycheck, ” along with sales commissions and other reimbursements due to Plaintiff, and that these payments “were withheld under [Quick's] direction for months before [Quick] was terminated.” (ECF No. 230-2; Plaintiff's Affidavit, ¶ 5). Plaintiff has presented no evidence that Quick was acting under instruction or direction of Fisk or Andreas.
After careful review of the evidence in this case, considered pursuant to the applicable case law and in the light most favorable to the Plaintiff, the undersigned finds that Plaintiff has failed to establish an issue of fact as to whether he should be allowed to pierce the corporate veil as to Defendant Andreas or that Andreas otherwise should be held individually liable under the SCPWA claim. Cf. Dumas, 463 S.E.2d at 645 [“[W]e hold the legislature intended to impose individual liability on agents or officers of a corporation who knowingly permit their corporation to violate the Act.”]; Nabors v. Lewis, No. 6:17-2887-DCC-KFM, 2018 WL 7118008, at *6 (D.S.C. Feb. 16, 2018). Accordingly, the undersigned recommends granting summary judgment to Defendant Andreas on this claim.
B. Second Cause of Action: Breach of Contract, Breach of Contract with Fraudulent Intent, and Detrimental Reliance
The necessary elements of a contract are an offer, acceptance, and valuable consideration. Roberts v. Gaskins, 486 S.E.2d 771, 773 (S.C. Ct. App. 1997) (citing Carolina Amusement Co., Inc. v. Connecticut Nat'l Life Ins., Co., 437 S.E.2d 122 (S.C. Ct. App. 1993)). To show a breach of contract accompanied by a fraudulent act, Plaintiff must show: (1) a breach of a contract; (2) fraudulent intent relating to the breaching of the contract and not merely to its making, and (3) a fraudulent act accompanying the breach. RoTec Services, Inc. v. Encompass Services, Inc., 597 S.E.2d 881, 883 (S.C. Ct. App. 2004) (citing Conner v. City of Forest Acres, 560 S.E.2d 606, 612 (S.C. 2002)). Plaintiff's claim involving breach of contract accompanied by a fraudulent act also requires, in the first instance, that he establish the existence of a contract. See Shelton v. Oscar Mayer Foods Corp., 459 S.E.2d 851, 857 (S.C. Ct. App. 1995), aff'd, 481 S.E.2d 706 (1997); Maco v. Lewis, 697 S.E.2d 684, 688 (S.C. Ct. App. 2010); Lister v. Nationsbank of Delaware, N.A., 494 S.E.2d 449, 454 (S.C. Ct. App. 1997). Finally, Plaintiff also alleges a claim for detrimental reliance in combination with his contract claims.
With respect to this cause of action, Plaintiff argues that he has set forth valid claims against M-E-C and former Defendant Quick. ECF No. 230 at 15. He then argues that Defendant Andreas “is liable to the Plaintiff for this cause of action because at all times his wife [Defendant Fisk] was acting as his representative and he was a board member of MEC that made promises to the Plaintiff.” Id. Presumably, Plaintiff seeks to hold Defendant Andreas liable as a board member of M-E-C. Even so, in making this argument, Plaintiff does not include any other applicable facts or specifics as to why Defendant Andreas should be personally responsible for an employment contract Plaintiff may have had with M-E-C, and has provided no legal support for holding Defendant Andreas individually liable under his contract claim.
Plaintiff has not presented any evidence to show, or to raise a genuine issue of fact as to whether, he had a “contract” with Defendant Andreas. Without showing a contract, he cannot show a cause of action for breach of contract with fraudulent intent. As noted above, there is no evidence to support piercing the corporate veil of M-E-C to impose liability individually on Defendant Andreas based upon a contract between Plaintiff and M-E-C.
Moreover, Plaintiff has not established he had any interaction with Defendant Andreas or that Andreas made any promises to him, such that he cannot establish that he detrimentally relied on any promises by Andreas. Plaintiff does not argue, either, that Defendant Fisk made any promises to him on behalf of Andreas, such that he cannot to show that he detrimentally relied on any promises made by her. Accordingly, Defendant Andreas is entitled to summary judgment on Plaintiff's Second Cause of Action.
Plaintiff conceded in an earlier Response to Defendant Fisk's Motion for Summary Judgment that she did not make any promises to him. See ECF No. 218 at 14.
C. Third Cause of Action: Conversion
Conversion “is the unauthorized assumption and exercise of rights of ownership over goods or personal chattels belonging to another, to the alteration of their condition or to the exclusion of the rights of the owner.” Walters v. Canal Ins. Co., 363 S.E.2d 120, 122 (S.C. Ct. App. 1987). Plaintiff contends that Defendant Fisk, acting as her husband's representative, along with Defendant Lichtenfeld, locked him out of the Charleston office, refused to return his personal property, switched off his cell phone and terminated his employment. ECF No. 230 at 15-16. However, he provides no citations to the record to support these allegations and assumptions. While it appears Defendant Fisk was present in Charleston at the time when the locks on the office were changed, Plaintiff has made no showing that she exercised or participated in an unauthorized personal assumption and rights of ownership over Plaintiff's goods or personal chattels, to the alteration of their condition or to the exclusion of the rights of the Plaintiff. Therefore, because Plaintiff's theory of liability hinges upon Fisk acting as a representative of Defendant Andreas, he cannot establish this cause of action against Andreas. Defendant is entitled to summary judgment on this claim.
Indeed, at best, Plaintiff contends Lichtenfeld was the individual who terminated Quick and, in essence, undertook his position as being in charge of the office. ECF No. 281-1 at 47-51; Plaintiff's Depo., pp. 77-79, 86-87).
D. Fifth Cause of Action: Slander
In his Fifth Cause of Action, Plaintiff alleges that Defendant Andreas made false statements against him and accused him of crimes that he did not commit. Defamatory communications can take two forms: libel and slander. Slander is a spoken defamation, while libel is a written defamation or one accomplished by actions or conduct. Swinton Creek Nursery v. Edisto Farm Credit, 514 S.E.2d 126 (S.C. 1999). In South Carolina, the elements for a defamation claim are: (1) a false and defamatory statement concerning another; (2) an unprivileged publication to a third party; (3) fault on the part of the publisher; and (4) either actionability of the statement irrespective of special harm or the existence of special harm caused by the publication. Murray v. Holnam, Inc., 542 S.E.2d 743, 748 (S.C. Ct. App. 2001). Further, a statement may be actionable per se where it is both false and defamatory and suggests (1) the commission of a crime of moral turpitude, (2) contraction of a loathsome disease, (3) adultery, (4) unchastity, or (5) unfitness in one's business or profession. Holtzscheither v. Thomson Newspapers, Inc., 506 S.E.2d 497, 508- 09 (S.C. 1998).
Plaintiff provides no citation to any records or evidence to support this claim against Defendant Andreas, other than to state “Defendant confirms all of his false statements with the statements ‘As a matter of fact, Steve Rice and John Quick set up a fraudulent front as M-E-C-Company in South Carolina.'” ECF No. 230 at 16. Plaintiff also argues that Andreas “made these statements outside of the Court and should be held liable for those false statements that he continues to make.” Id. at 17. Again, however, Plaintiff cites to no evidence to support this statement. Moreover, the undersigned further notes that Plaintiff has not addressed when any such statement was allegedly made, to whom it was made, or provided any context surrounding the alleged statements that Defendant Andreas published. See Doe v. Cannon, C/A No. 2:16-cv-00530-RMG, 2017 WL 591121, at *1 (D.S.C. Feb. 14, 2017) (dismissing claim for defamation where plaintiff failed to specify the time, place, medium and listener of the alleged defamatory statements).
Presumably, Plaintiff is referring to statements made by Defendant Andreas in the Motion for Summary Judgment presently under consideration. See ECF No. 226 at 1. Although Plaintiff argues that Defendant “made these statements outside of the Court, ” the only evidence before the Court is the letter itself. As noted at the outset, the Court has interpreted the letter as a legal document, specifically a motion for summary judgment. Assuming the statements in Defendant's Motion are defamatory, an absolute litigation privilege applies to statements made by parties in filings made with the court during the course of litigation. Meyer v. McGowan, C/A No. 2:16-cv-00777-RMG-MGB, 2018 WL 4941134, at *8 (D.S.C. July 31, 2018) (citing Pond Place Partners, Inc. v. Poole, 567 S.E.2d 881, 892 (S.C. Ct. App. 2002)). Here, the alleged defamatory statements, as set forth in the filing before the Court, are absolutely privileged as to Defendant Andreas.
Therefore, after careful review and consideration of the evidence presented on this issue in conjunction with the applicable case law, Defendant Andreas is also entitled to summary judgment on this claim.
CONCLUSION
For the reasons set forth above, it is RECOMMENDED that Defendant Andreas's Motion for Summary Judgment, ECF No. 226, be GRANTED and this action be DISMISSED as to him.
The parties are referred to the Notice Page attached hereto.
Notice of Right to File Objections to Report and Recommendation
The parties are advised that they may file specific written objections to this Report and Recommendation with the District Judge. Objections must specifically identify the portions of the Report and Recommendation to which objections are made and the basis for such objections. “[I]n the absence of a timely filed objection, a district court need not conduct a de novo review, but instead must ‘only satisfy itself that there is no clear error on the face of the record in order to accept the recommendation.'” Diamond v. Colonial Life & Acc. Ins. Co., 416 F.3d 310 (4th Cir. 2005) (quoting Fed.R.Civ.P. 72 advisory committee's note).
Specific written objections must be filed within fourteen (14) days of the date of service of this Report and Recommendation. 28 U.S.C. § 636(b)(1); Fed.R.Civ.P. 72(b); see Fed.R.Civ.P. 6(a), (d). Filing by mail pursuant to Federal Rule of Civil Procedure 5 may be accomplished by mailing objections to:
Robin L. Blume, Clerk
United States District Court
Post Office Box 835
Charleston, South Carolina 29402
Failure to timely file specific written objections to this Report and Recommendation will result in waiver of the right to appeal from a judgment of the District Court based upon such Recommendation. 28 U.S.C. § 636(b)(1); Thomas v. Arn, 474 U.S. 140 (1985); Wright v. Collins, 766 F.2d 841 (4th Cir. 1985); United States v. Schronce, 727 F.2d 91 (4th Cir. 1984).