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PATRICIA A. Winooss STUART B. YOUNG
EDWARD B MAXWELL. IND
May 24, 2006
BY CM/ECF AND HAND DELIVERY
The Honorable Kent A. Jordan
United States District Court
844 N. King Street
Wilmington, DE l980l
Re: Cryovac, Inc. v. Pechinev Plastic Packagina, Inc.. C.A. No. 04-1278-KA]
Dear Judge Jordan:
We submit this letter on behalf of plaintiff Cryovac, Inc., further to the Cour1;’s directive at
the May I5, 2006, pre-trial conference that each party prepare a three—page submission stating its
position regarding the issue of what is legally required to prove the “without justification" element of
tortious interference, i.e., whether infringement is sufficient or whether proof of willful and
malicious infringement is necessary} As set forth herein, the American Bar Association Model Jury
Izzszvuctions, the RESTATEMENT (SECOND) OF TORTS, and applicable case law all firmly support
Cryovac’s position that Pechiney’s patent infringement standing alone satisfies the "without
justification" element of tortious interference. Moreover, as set forth below, insofar as Pechiney
submits that Cryovac is required to prove malice as part of its prima facie case because Kansas law
. 7 . . . .
appl1es,“ under Kansas law any requirement that Cryovac prove malice is satisfied by proof of
"wrongful means" alone — here Pechiney’s patent infiingement. I
l. Pechiney’s Infringement Constitutes Proof of the "Without Justification" Element for
Tortious Interference. RESTATEMENT (SECOND) OF TORTS § 767 cmt. c provides that "[c]onduct
specifically in violation of statutory provisions or contrary to established public policy may for that
reason make interference improper. . ." The American Bar Association Model Jzuy Instructions,
upon which both parties’ proposed instructions are based, are consistent and provide that where the
fact finder determines a defendant violated a statutory provision, the fact finder also "rnust find that
the defendant’s conduct was improper, regardless of any justification that the defendant may claim."
I The references to "tortious interference" in this submission refer to claims for tortious interference with contract.
Cryovac submits that the "improper interference" element is not part ofthe prima facie case for tortious interference with
prospective relations. This dispute does not impact the proofs, however, and need not be resolved at this time.
2 Pechiney hinted that Kansas law might be determinative at the May I5 Pre-Trial Conference, and out of an abundance
of caution we will address Kansas law briefly herein. Pechiney’s contention interrogatory responses and summary
`udvment briefinv A r. 17 O inion at n.l l did not hint or su ¤est that choice of law was determinative, and in &amin¤
.] U D p · . p · gb l · U
the issue for this submission herein, Pechiney did not indicate that choice of law was determinative.
Case 1:04-cv-01278-KAJ Document 336 Filed 05/24/2006 Page 2 of 3
YoUNo CoNAwAv STARGATT & TAYLOR, LLP
The Honorable Kent A. Jordan
May 24, 2006
Page 2
[cl. § 1.4.3 at 37 (4th ed. 2005). See also icl. cmt. ("un1awful means on the part of the defendant
destroys any claim of justification").
Extensive case law follows the Restatement and the ABA Model Jury Instructions. This case
law demonstrates not only that unlawful acts are sufficient to satisfy the “without justification" ele-
ment, but that this element does not require proof of bad or improper state of mind — the courts have
held that antitrust violations and unfair competition violations suffice. The case law thus squarely
refutes Pechiney’s assertion that malicious and willful infringement must be found to satisfy the
"withoutjustification" element. See, e. g., HJ, Inc. v. Int ’l Tel. & Telegraph Corp., 867 F.2d 1531,
1548 (8th Cir. 1989) ("[Defendant’s] attempted monopolization not only constituted wrongful means
which deny it this ‘special privilege for competitorsf but also was improper as required for tortious
interference."); F un-Dameiztal T oo, Ltd v. Gemmy Indus., Corp., 1996 U.S. Dist. LEXIS 18653, at *
13 (S.D.N.Y. Dec. 17, 1996) (holding that violations ofthe Lanham Act and proof of unfair competi-
tion in violation of statutory and common law "wou1d constitute improper or unlawful means and
meet the third requirement for stating a claim of tortious interference .... "); Reading [nt ’l, [nc. v.
Sutton Hill Capital, LLC, 317 F. Supp. 2d 301, 334 (S.D.N.Y. 2003) ("It seems obvious that alleging
violations of federal antitrust law and state statutory law should satisfy the pleading requirements for
wrongful conduct. Indeed, . . . a competitor can be held liable for tortious interference with
prospective contractual relations where ‘unlawful restraint of trade is effected."’); Community Title
Co. v. Roosevelt F ed. Sav. & Loan Assoc., 796 S.W. 2d 369, 373 (Mo. 1990) ("Improper means, for
purposes of intentional interference with contractual relations or business expectancy, are those
means which are independently wrongful, notwithstanding injury caused by the interference.");
Briner Elec. Co. v. Sac/is Elec. Co., 680 S.W. 2d 737, 743 (Mo. Ct. App. 1984) ("Wrongful means
would generally entail either an illegal act or an act that is actionable in and of itself").
Pechiney’s insistence that willful infringement is required to satisfy the "without
justification" claim element likely stems from its failure to recognize that there are two distinct ways
in which a plaintiff can prove that a defendant acted "without justification" — proof of inrproper
motive or proof of improper means. Top Sew. Body Shop, [nc. v. Allstate Insur. Co., 582 P.2d 1365,
1370 (Or. 1978) ("[E]ven when defendant’s objectives are not inrproper, for instance the pursuit of
competition or other legitimate interests, defendant may still be liablefor using improper means to
achieve these objectives .... . Defendant’s liability may arise from improper motives or from the use
of improper means."); Leigh Fzuwiture & Carpet Co. v. Isom, 657 P.2d 293, 307 (Utah 1982)
("Prob1ems inherent in proving motivation or purpose make it prudent for commercial conduct to be
regulated for the most part by the improper means altemative, which typically requires only a
showing of particular conduct."). Accordingly, where wrongful means exist, defendant’s motive
need not be considered.
2. Pechiney’s Late Claim that Kansas Law Is Detemrinative Is Wrong. At the May 15,
2006 pre-trial hearing, Pechiney mentioned for the first time that Kansas law applies and may be
outcome determinative. We will therefore briefly address Kansas law, even though Pechiney has not
disclosed its reasons for asserting that Kansas law applies.
While Kansas law identifies "malice" as an element of the tort, in practical temrs this docs
change what Cryovac is required to prove because Kansas does not interpret the "without
justification" element of the tort differently than the RESTATEMENT. Kansas courts applying the
stated "malice" requirement only discuss proof by way of improper motive, not improper means, and
these cases thus do not shed light on how Kansas law would deal with proof of the "without
Case 1:04-cv—01278-KAJ Document 336 Filed 05/24/2006 Page 3 of 3
YOUNG CONAWAY STARGATT & TAYLOR, LLP
The Honorable Kent A. Jordan
May 24, 2006
Page 3
justification" element by way of improper means (such as a patent infringement). The Kansas cases
which address the "without j ustification" element in the context of proof by improper means are in—
formative: the cases hold that, under Kansas law, proof of an unlawful act alone satisfies this claim
element. See Reazizz v. Blue Cross and Blue Shield ofKarzsczs, [nc., 663 F. Supp 1360, 1429 (D.
Kan. 1987) (denying defendant’s post—trial argument that jury instructions were erroneous because
they permitted jury to find interference without finding intentional misconduct and noting that "[i]f
anything, the instructions on tortious interference imposed on plaintiff [] a stricter burden of proof
than is otherwise required, given the predicate findings of antitrust violations.") (citing RESTATE-
MENT § 767, cmt. d), afd in part and rev’d in part on other grounds, 899 F.2d 951 (10th Cir. 1990).
Finally, Kansas cases cite RESTATEMENT 767 frequently, there is no reason to believe Kansas would
reject RESTATEMENT § 767 cmt. c or the cases from other jurisdictions discussed above. See OMB
Police Simply, Inc. v. Elbeco, [nc., 2001 U.S. Dist. LEXIS 8310, at * 13 (D. Kan. May 10, 2001) ("ln
Turner, the Kansas Supreme Court cited approvingly Section 767 ofthe RESTATEMENT. This Court
predicts that the Kansas Supreme Court would similarly approve comment c to that section.")
(holding that alleged antitrust violation satisfies without justification element).
Finally, it is not clear that Kansas law even applies, and without a detailed factual
presentation it cannot be stated with any certainty which of five possible states’ laws will govern.
Illinois (Pechiney’s principal place of business, where it developed ClearShield, and the origin of
many or most ofthe communications leading to National’s breach), South Carolina (location of the
plants which lost the National business and Cryovac’s principal place of business), Missouri
(Nationa1’s principal place of business and where National made the decision to breach), or
Delaware (Cryovac’s, Pechiney’s state of formation, and the only state with a common tie to all
parties) all may control; all are consistent with the RESTATEMENT analysis. Moreover, when choice
of law is difficult to ascertain, the policies of RESTATEMENT (SECOND) OF CONFLICT OF LAWS
indicate that selecting Delaware law is the best course of action. See Bicklizzg v. Kent Gen. Hosp.,
872 F. Supp. 1299, 1306 & n.1 (D. Del. 1994) (ease of determination points to forum law and along
with uniformity and certainty of result) and RESTATEMENT §6(g). Moreover, "the Restatement test
does not authorize a court to simply add up the interests on both sides of the equation and
automatically apply the law of the jurisdiction meeting the highest number of contacts .... "
Travelers Imlem. Co. v. Lake, 594 A.2d 38, 48 (Del. 1991).
Suffice it to say, the choice of law analysis is highly factual. ln this circumstance, Kansas
law does not appear to be different on the law of improper means as proof of the relevant tort
element, and the interests of uniformity and judicial economy likely dictate that Delaware law
applies in any event.
Respectfully submitted,
lyuwéiw
J W. Shaw
No. 3362
cc: Clerk of the Court (by hand delivery)
N. Richard Powers (by CM/ECF and hand delivery)
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