Rando v. Leonard , 826 F.3d 553 ( 2016 )

United States Court of Appeals
For the First Circuit
No. 15-1857
SHELLY A. RANDO,
Plaintiff, Appellant,
v.
MICHELLE LEONARD,
Defendant, Appellee,
CVS PHARMACY, INC.,
Defendant.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS
[Hon. Leo T. Sorokin, U.S. District Judge]
Before
Torruella, Thompson, and Kayatta,
Circuit Judges.
Robert D. Loventhal, on brief for appellant.
Laura M. Raisty and Locke Lord LLP, on brief for appellee.
June 17, 2016
TORRUELLA, Circuit Judge. From 2010 to 2012, more than
100 bottles of the pain medication butalbital went missing from a
CVS Pharmacy in Concord, Massachusetts. After a CVS surveillance
video showed plaintiff-appellant Shelly Rando, a pharmacy
technician, pocketing a bottle of butalbital, Rando was suspected
of committing the thefts. Defendant-appellee Michelle Leonard, a
loss prevention manager at CVS, conducted an interview with Rando
in which Rando confessed to stealing all of the missing bottles,
and Rando was subsequently terminated. In this suit, Rando denies
that she stole the bottles and asserts that Leonard is liable for
the tort of intentional interference with contractual relations
for forcing her to confess. The United States District Court for
the District of Massachusetts entered summary judgment in favor of
Leonard. We affirm.
I.
A. Factual History
Since 2002, Leonard has served as a Regional Loss
Prevention Manager at CVS Pharmacy, Inc. ("CVS").1 As a Loss
Prevention Manager, Leonard investigates "shrinkage," the loss of
inventory due to factors such as theft and vendor fraud. In
February of 2011, Leonard learned of significant "growth" in
1 CVS Pharmacy was incorrectly named as CVS Caremark in the
complaint.
-2-
butalbital at the CVS in Concord.2 Growth occurs where a pharmacy
"order[s] a drug in quantities that significantly exceed those
that are being dispensed to patients." At that time, the CVS
should have had 73 bottles, each containing 100 tablets of
butalbital, in inventory. A review of the inventory yielded only
205 tablets of butalbital: 7095 tablets, or slightly fewer than
71 bottles, were missing. The losses soon stopped, however, and
Leonard concluded that an employee who had recently left the
company must have been responsible for their disappearance. In
April of 2012, Leonard learned that the same CVS in Concord was
again experiencing growth in butalbital, with 67 bottles, or 6700
tablets, missing. All in all, a total of 138 bottles of butalbital
had disappeared since 2010. Around this time, Leonard also
learned that the CVS had growth in hydrocodone.
Rando had served as a pharmacy technician at various CVS
stores since 1994 and was then employed at the CVS in Concord. On
April 21, 2012, an in-store surveillance camera captured Rando
taking a bottle of butalbital off the shelf and placing it in her
pocket. Rando took the bottle home that day. After watching the
video, either store manager Steve Normandy or pharmacy manager
2 The prescription drug at issue in this litigation is in fact a
combination of butalbital, acetaminophen, and caffeine. We refer
to the drug as "butalbital" throughout this opinion.
-3-
Colleen Robillard told Leonard about the tape and informed her
that a bottle of butalbital was missing. Leonard watched the tape
as well.3
Two days later, on April 23, Leonard interviewed Rando
with another loss prevention manager, Alfie Binns. Early in the
interview, Rando acknowledged having taken the single bottle of
butalbital on April 21. Leonard then broached the issue of whether
Rando had also stolen the hydrocodone and the other 138 bottles of
butalbital. Rando felt coerced and pressured during the meeting
and recalled that Leonard barraged her with questions. Leonard
repeatedly placed a confession in front of Rando for her to sign,
asked whether Rando knew that she was going to be terminated,
yelled at Rando, and threatened to call the police.4 Rando also
felt nervous as she did not know who Binns was or why he was there.
Desperate to leave and exhausted by Leonard's constant questions,
Rando finally signed the confession and a promissory note stating
that she had stolen the 138 bottles of butalbital (but not any
3 Rando denies that Leonard recognized her in the tape on the
basis that, in her deposition, Leonard stated that she did not
recall whether she could see Rando's face or what Rando did with
the bottle in the video.
4 It is difficult to discern, based on Rando's testimony, whether
Leonard threatened to call the police before or after Rando
confessed to stealing the remaining bottles of butalbital. For
purposes of summary judgment, we will assume that Leonard made
this threat before Rando's confession.
-4-
hydrocodone) and owed CVS $7,482.99. During her deposition, Rando
stated that she "would have admitted to stealing the crown jewels
to get out of that room."
Once Rando signed the confession, Leonard called the
police and they arrived soon after. Rando agreed to let them
search her home. During the search, the police found the bottle
of butalbital that Rando had stolen two days before, along with
two empty bottles from a "long, long time ago." Rando has not had
a prescription for butalbital for more than ten years.
In early May, Normandy called Rando to terminate her
employment. Normandy did not explain why Rando was being
terminated, nor did Rando ask for an explanation. Rando was
charged with one count of larceny over $250 in the Concord District
Court. After CVS failed to give any further evidence to the
assistant district attorney ("ADA") in charge of the case, Rando
was accepted into a pretrial diversion program. Rando took drug
tests over a six-month period as part of the program, and the case
was dismissed. The ADA later informed Rando's counsel that
another individual had confessed to stealing the hydrocodone.
B. Procedural History
In May of 2013, Rando filed suit against Leonard and CVS
in the United States District Court for the District of
Massachusetts on the basis of diversity jurisdiction. Her amended
-5-
complaint alleged counts of malicious prosecution, intentional
infliction of emotional distress, negligent infliction of
emotional distress, intentional interference with contractual
relations, and abuse of process.
The defendants moved to dismiss Rando's claims under
Federal Rules of Procedure 12(b)(1) and 12(b)(6). The district
court dismissed all of Rando's claims except her count for
intentional interference with contractual relations, which was
only alleged against Leonard.5 After discovery, Leonard filed a
motion for summary judgment, which the district court granted in
a written order. Rando now appeals that determination.
II.
A. Standard of Review
"We review an order for summary judgment de novo,
evaluating the facts and all reasonable inferences therefrom in
the light most flattering to the nonmoving party." Nieves-Romero
v. United States, 715 F.3d 375, 378 (1st Cir. 2013). Summary
judgment is warranted where "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). "An issue is 'genuine' if the
evidence of record permits a rational factfinder to resolve it in
5 Accordingly, none of Rando's claims against CVS remain in this
case.
-6-
favor of either party," and "'material' if its existence or
nonexistence has the potential to change the outcome of the suit."
Borges ex rel. S.M.B.W. v. Serrano-Isern, 605 F.3d 1, 4-5 (1st
Cir. 2010).
B. Analysis
For the tort of intentional interference with
contractual relations,
a plaintiff must prove that (1) he had an
advantageous relationship with a third party . . . ;
(2) the defendant knowingly induced a breaking of
the relationship; (3) the defendant's interference
with the relationship, in addition to being
intentional, was improper in motive or means; and
(4) the plaintiff was harmed by the defendant's
actions.
Blackstone v. Cashman, 860 N.E.2d 7, 12-13 (Mass. 2007). Although
Leonard concedes that Rando can satisfy the first element of the
four-part test through her employment relationship with CVS, she
asserts that Rando cannot make the other three showings. Because
Rando fails to satisfy the third prong of the test -- that
Leonard's alleged inducement was improper -- we need not reach
Leonard's other arguments.
In assessing whether a defendant acted with improper
motive or means, Massachusetts courts apply a heightened standard
where defendants are "'corporate officials' acting 'within the
scope of their employment responsibilities.'" Id. at 13 (quoting
Gram v. Liberty Mut. Ins. Co., 429 N.E.2d 21, 24 (Mass. 1981)).
-7-
In such instances, the plaintiff must carry the heavy burden of
showing that the defendant acted with "actual malice," or, with "a
spiteful, malignant purpose, unrelated to the legitimate corporate
interest." Id. (quoting Wright v. Shriners Hosp. for Crippled
Children, 589 N.E.2d 1241, 1246 (Mass. 1992)).
In her motion for summary judgment before the district
court and again on appeal, Leonard argued that she was a "corporate
official" and the actual malice standard was therefore
appropriate. By doing so, she fulfilled her threshold duty of
"bringing to the attention of the plaintiff and the court in some
fashion that [s]he claims to qualify as a 'corporate official' of
the relevant corporation and therefore is entitled to have the
actual malice standard apply." Weiler v. PortfolioScope, Inc.,
12 N.E.3d 354, 364 (Mass. 2014). Once Leonard asserted that she
qualified as a corporate official, Rando "[bore] the burden of
proving either that the defendant does not so qualify and is not
entitled to the actual malice standard, or that the defendant did
act with actual malice." Id. Rando does not carry this burden,
as she has waived any argument that Leonard does not qualify as a
"corporate official" and fails to produce evidence that Leonard
acted with actual malice.
In her opposition before the district court, Rando
stated, in a single sentence, that she did not believe
-8-
Massachusetts case law supported Leonard's argument that she
qualified as a corporate official and that Rando did "not waive
the right to argue that a showing of malice is not required." On
appeal, Rando's briefing on this issue is limited to a footnote in
which she reiterates that she "does not waive the right to argue
that a showing of malice is not required" and asserts, without
developed argument, that "[c]orporate officials' status is
reserved for owners and controlling officials of a company."
Despite Rando's assertions to the contrary, these perfunctory
arguments are insufficient to preserve her argument on appeal.
See Armistead v. C & M Transp., Inc., 49 F.3d 43, 45 n.2 (1st Cir.
1995) (deeming waived an "argument [that] was not fully developed
below"); United States v. Zannino, 895 F.2d 1, 17 (1st Cir. 1990)
("[I]ssues adverted to in a perfunctory manner, unaccompanied by
some effort at developed argumentation, are deemed waived.").6
6 Even if it were not waived, Rando's argument that the "corporate
officials" analysis is reserved for more senior employees such as
owners and shareholders is without merit. The term "corporate
official" has been used "expansively" to include "high level
corporate officers, as well as directors involved in management."
Blackstone, 860 N.E.2d at 17; see also Zimmerman v. Direct Fed.
Credit Union, 262 F.3d 70, 76 (1st Cir. 2001) (explaining that the
actual malice analysis applies to "defendant-supervisors");
Boothby v. Texon, Inc., 608 N.E.2d 1028, 1040 (Mass. 1993) (same).
Leonard need not have "day-to-day involvement" in the enterprise
so long as her activities are "directed toward corporate purposes."
Blackstone, 860 N.E.2d at 17 (quoting Gram, 429 N.E.2d at 24).
Although she was not Rando's direct supervisor, Leonard acted in
a managerial position and her actions here served the corporate
purpose of "protection of company assets and reduction of
-9-
Although Rando's arguments regarding whether Leonard
acted with actual malice are properly preserved, we find that Rando
produces no evidence suggesting that Leonard acted with actual
malice and without a legitimate corporate purpose. See Zimmerman
v. Direct Fed. Credit Union, 262 F.3d 70, 76 (1st Cir. 2001)
("Proof of actual malice requires more than a showing of mere
hostility."). Rando asserts that Leonard knowingly elicited a
false confession from Rando because Leonard "was looking for
someone to pin the blame on" after failing to find the cause of
the continued butalbital and hydrocodone losses. Rando's only
evidence on this point is that Leonard spoke to her boss,
Christopher Crossman, about the thefts before interviewing Rando.
But the mere fact that Leonard discussed an assignment with her
boss does not suggest that she was frustrated or looking for
someone to blame, as Rando argues. Rando also asserts that Leonard
accused Rando "without any evidence establishing that theft." To
the contrary, Leonard had reason to believe that Rando may have
been the culprit: Rando worked at the Concord CVS when the thefts
began, and she was caught on videotape stealing a bottle of
butalbital. To be sure, Rando's theft of one bottle of butalbital
shrinkage." Applying the "actual malice" standard here thus
serves the policy of protecting those involved "in matters related
to the conduct of the internal affairs of a corporation." Id. at
16 n.15.
-10-
does not necessarily mean she was responsible for the other thefts.
Nevertheless, there is no indication that Leonard, by
investigating Rando's potential involvement in the overarching
growth problem, acted with spite or malice.7 Rando claims that
Leonard lied to her, but the record evidence does not support this
assertion. Nor does Rando produce any evidence that Leonard
harbored any ill will toward Rando. Indeed, their prior
interactions, which were limited to polite greetings, were
uneventful. At worst, Rando's testimony suggests that Leonard
aggressively questioned Rando, informed Rando that she faced
termination, threated to call the police, and yelled at her. We
do not doubt that Rando felt frightened and upset by this
encounter. Leonard's behavior, however, simply does not rise to
the level of "actual malice." See Weber v. Cmty. Teamwork, Inc.,
752 N.E.2d 700, 716 (Mass. 2001) ("[E]vidence that a corporate
official engaged in 'sloppy and unfair business practices' is an
insufficient basis to negate the official's broad privilege to
terminate an at-will employee." (quoting Gram, 429 N.E.2d at 25));
King v. Driscoll, 638 N.E.2d 488, 495 (Mass. 1994) ("[P]ersonal
dislike will not warrant an inference of the requisite ill will.").
7 Moreover, the evidence shows that during the interview Leonard
asked Rando only one question about the hydrocodone. Once Rando
denied stealing the hydrocodone, Leonard did not ask any further
questions on that topic.
-11-
Recall, Leonard's job was to determine the source of the butalbital
and hydrocodone losses: even if she did so in a hostile manner,
that evidence cannot support a claim for intentional interference
with contractual relations.
III.
Because the record is devoid of any evidence that Leonard
acted with actual malice, the motion for summary judgment is
affirmed.
Affirmed.
-12-