349 Conn. 120
Conn.2024Background
- Deutsche Bank AG sought to collect a $243 million English judgment against Sebastian Holdings, Inc. (SHI), alleging Alexander Vik controlled SHI and engaged in asset transfers to avoid payment.
- Deutsche Bank obtained a Norwegian court order for the sale of SHI-owned shares in Confirmit AS, a Norwegian software company, to partially satisfy the judgment.
- The bank alleged Alexander Vik and his daughter, Caroline Vik, interfered with the sale through various tactics: filing meritless appeals, requesting unlawful removal of a lien, stacking Confirmit’s board, submitting false bids, and creating/falsifying documents to disrupt the sale.
- Caroline attempted to enforce a fraudulent right of first refusal (ROFR) to buy the shares, bringing actions in both Norwegian and U.S. courts, which were denied or voluntarily dismissed.
- Deutsche Bank claimed these actions drove down the final sale price, reducing its recovery, and sued the Viks for tortious interference and violations of the Connecticut Unfair Trade Practices Act (CUTPA).
- The trial court denied the Viks’ motion to dismiss based on litigation privilege, but the Appellate Court reversed; the Connecticut Supreme Court granted review on whether Deutsche Bank’s claims were barred by the litigation privilege.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Mootness due to prior case (Sebastian) | Appeal was not moot; prior case concerned other issues and earlier conduct | Prior decision precludes current claims; case is moot or barred by collateral estoppel | Not moot; allegations in this case are distinct (2016+) and not precluded by prior findings |
| Litigation privilege scope | Claims involve extrajudicial misconduct, not statements in judicial proceedings | All conduct is "inextricably intertwined" with litigation; thus, privilege applies | Privilege does not cover extrajudicial conduct; many allegations are outside any judicial proceeding |
| Applicability to non-parties/actions | Alleged misconduct includes actions by Erik Vik and Caroline, directed by Alexander | Only litigation-related conduct matters; privilege bars all claims even if including others | Privilege only applies to statements/acts in judicial proceedings by participants; not applicable to much of defendants’ conduct |
| Remedy if privilege partially applies | Only privileged allegations should be stricken; remainder should proceed | Entire complaint barred if intertwined with litigation-related actions | Even if privilege applied to some actions, claims stand on extrajudicial misconduct; case should not be dismissed in full |
Key Cases Cited
- Simms v. Seaman, 308 Conn. 523 (scope and policy of litigation privilege; factors limiting its application)
- Dorfman v. Smith, 342 Conn. 582 (defining application and exceptions to litigation privilege, particularly for abuse of process)
- Scholz v. Epstein, 341 Conn. 1 (clarifying when litigation privilege does not apply, especially for non-communicative, extrajudicial acts)
- MacDermid, Inc. v. Leonetti, 310 Conn. 616 (distinguishing between privileged litigation conduct and non-privileged improper use of judicial system)
- Hopkins v. O’Connor, 282 Conn. 821 (defining when statements and conduct are covered by litigation privilege)