Howard M. Kahalas, PC v. Schiller
164 F. Supp. 3d 241
D. Mass.2016Background
- Kahalas, P.C., a Boston personal-injury law firm, alleges Marc J. Schiller (a New Hampshire attorney and uncle of the injured patient’s boyfriend) slandered the firm to the patient’s family so they would retain different counsel for a 2015 motor-vehicle injury claim.
- Kahalas attorneys met the Tuscano family and Schiller at the firm; communications chilled afterward and the family retained new counsel shortly after the meeting.
- Kahalas filed state-court claims for (1) intentional interference with contractual relations, (2) intentional interference with advantageous business relations, (3) defamation, and (4) Chapter 93A unfair business practices; Schiller removed to federal court and moved to dismiss or for a more definite statement.
- Court accepted Kahalas’s factual allegations for purposes of the motion but analyzed whether the pleadings met Twombly/Iqbal plausibility standards for each claim.
- The court dismissed Counts 1 (interference with contractual relations) and 4 (Chapter 93A) for failure to plead required elements, and denied dismissal of Counts 2 (interference with advantageous business relations) and 3 (defamation); the Rule 12(e) motion for a more definite statement was denied.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Kahalas adequately pleaded interference with contractual relations | Kahalas alleges a contract to represent Kathleen (via family arrangement), Schiller slandered them to induce termination and received referral fees | Schiller says plaintiff fails to identify a valid contract with Kathleen or facts showing slander, referral payments, or improper motive/means | Dismissed — plaintiff failed to plead formation/validity of a contract or facts supporting interference element |
| Whether Kahalas adequately pleaded interference with advantageous business relations | Kahalas alleges an existing business relationship with Kathleen/family, Schiller knew of it, used slander/improper means for referral, and caused loss of client and fees | Schiller contends the complaint lacks specifics about defamatory statements and causation | Survived — plaintiff pled sufficient facts to infer interference by improper means (defamation) |
| Whether Kahalas adequately pleaded defamation | Kahalas alleges Schiller made false, reputation-damaging statements to family causing economic loss | Schiller argues complaint fails to identify who said what, when, where, giving inadequate notice | Survived — court finds complaint gives fair notice and permits an inference that Schiller made actionable statements |
| Whether Kahalas may state a Chapter 93A claim against opposing counsel | Kahalas alleges unfair/deceptive acts (slander, referral compensation) causing monetary loss | Schiller argues he was not engaged in trade or commerce with Kahalas; only clients may typically bring c.93A actions against lawyers | Dismissed — plaintiff not the proper party under SJC precedent; fails to state a c.93A claim |
Key Cases Cited
- Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (plausibility pleading standard)
- Ashcroft v. Iqbal, 556 U.S. 662 (conclusory allegations insufficient under federal pleading standard)
- Crellin Techs., Inc. v. Equipmentlease Corp., 18 F.3d 1 (formation of contract generally a question of fact when evidence allows conflicting inferences)
- G.S. Enters., Inc. v. Falmouth Marine, Inc., 410 Mass. 262 (elements for intentional interference with contractual relations)
- Am. Private Line Servs., Inc. v. E. Microwave, Inc., 980 F.2d 33 (elements for interference with advantageous business relations)
- Ravnikar v. Bogojavlensky, 438 Mass. 627 (defamation elements and when economic loss is not required)
- Tetrault v. Mahoney, Hawkes & Goldings, 425 Mass. 456 (proper party to bring c.93A claim against an attorney)
- Schaeffer v. Cohen, Rosenthal, Price, Mirkin, Jennings & Berg, P.C., 405 Mass. 506 (limitations on c.93A claims against attorneys)