Donald Simmons v. Danhauer & Associates LLC

UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 11-1572
DONALD A. SIMMONS; LESLIE SIMMONS,
Plaintiffs - Appellants,
v.
DANHAUER & ASSOCIATES LLC,
Defendant,
and
PROXIBID, INCORPORATED,
Defendant - Appellee.
Appeal from the United States District Court for the District of
South Carolina, at Anderson. J. Michelle Childs, District
Judge. (8:08-cv-03819-JMC)
Submitted: March 30, 2012 Decided: April 13, 2012
Before NIEMEYER, WYNN, and FLOYD, Circuit Judges.
Affirmed by unpublished per curiam opinion.
Denny P. Major, Henry D. Sellers, HAYNSWORTH SINKLER BOYD, P.A.,
Greenville, South Carolina, for Appellants. W. Howard Boyd,
Jr., Thomas E. Vanderbloemen, Adam C. Bach, GALLIVAN, WHITE &
BOYD, P.A., Greenville, South Carolina, for Appellee.
Unpublished opinions are not binding precedent in this circuit.
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PER CURIAM:
Donald and Leslie Simmons appeal the district court’s
grant of summary judgment against them in this diversity action.
The case stems from an online auction hosted by Proxibid, Inc.,
(“Proxibid”), in which Lee Danhauer, of Danhauer & Associates
LLC (“Danhauer”), served as both auctioneer and bidder.
Although the Simmonses sued both Proxibid and Danhauer on
numerous grounds, on appeal they challenge the district court’s
grant of summary judgment to Proxibid as to only the following
claims: violation of South Carolina’s Unfair Trade Practices
Acts (“UTPA claim”), S.C. Code Ann. §§ 39-5-10 to 39-5-360 (1985
& Supp. 2011) (“SCUTPA”); aiding and abetting Danhauer’s breach
of fiduciary duty (“fiduciary duty claim”); and tortious
interference with a contract (“tortious interference claim”).
We affirm.
We review de novo a district court’s order granting
summary judgment. See Robinson v. Clipse, 602 F.3d 605, 607
(4th Cir. 2010). Summary judgment shall 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). “At the summary judgment stage, facts must be viewed in
the light most favorable to the nonmoving party only if there is
a genuine dispute as to those facts.” Scott v. Harris, 550 U.S.
372, 380 (2007) (internal quotation marks omitted).
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I. UTPA claim.
To establish a claim under SCUTPA, 1 the Simmonses were
required to demonstrate that Proxibid engaged in an unfair or
deceptive act or practice in the conduct of trade or commerce
and that such conduct affects the public interest. Hollman v.
Woolfson, 683 S.E.2d 495, 499 (S.C. 2009). The challenged
conduct must have been the proximate cause of a loss of “money
or property, real or personal,” thus entitling the Simmonses to
recover actual damages. S.C. Code Ann. § 39-5-140. Upon a
careful review of the record, we find that the numerous theories
and allegations the Simmonses have put forward in support of
their UTPA claim fail to establish a material issue of fact. 2
First, to the extent that they rely on allegations of
an arrangement or collusion between Proxibid and Danhauer to
drive up auction prices, the Simmonses have failed to produce
evidence aside from the coincidence of Proxibid and Danhauer’s
joint benefit from higher sale prices. Although Proxibid may
1
To the extent that the Simmonses’ UTPA claim was grounded
in North Carolina law, they have not pressed the issue on
appeal.
2
For the first time on appeal, the Simmonses allege that
Proxibid assured them that it would do its best to enable them
to secure the items on which they were bidding at the lowest
price possible. This new allegation is not properly before us
and need not be considered. See Muth v. United States, 1 F.3d
246, 250 (4th Cir. 1993).
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have failed to proactively prevent Danhauer’s allegedly
fraudulent actions or realize that its policies created the
potential for such abuse, negligence or incompetence alone is
insufficient to establish an unfair or deceptive practice
sufficient to support a claim under SCUTPA. See Clarkson v.
Orkin Estimating Co., 761 F.2d 189, 190-91 (4th Cir. 1985);
Wright v. Craft, 640 S.E.2d 486, 500 (S.C. Ct. App. 2006).
Furthermore, the Simmonses have not established that
Proxibid’s challenged conduct was a proximate cause of their
alleged damages. See Collins Holding Corp. v. Defibaugh, 646
S.E.2d 147, 150 (S.C. Ct. App. 2007); Baggerly v. CSX Transp.,
Inc., 635 S.E.2d 97, 101 (S.C. 2006).
Nor have the Simmonses produced competent evidence
that Proxibid’s challenged conduct impacts the public interest.
There is no showing that Proxibid has previously engaged in
actions similar to those complained of or will continue to
engage in such conduct. See Daisy Outdoor Advert. Co. v.
Abbott, 473 S.E.2d 47, 52 (S.C. 1996); Schnellmann v. Roettger,
627 S.E.2d 742, 746 (S.C. Ct. App. 2006). Mere speculation of
an adverse public impact, or speculation that the alleged
wrongdoer still engages in the same business, is insufficient to
establish the potential for repetition. See Omni Outdoor
Advert. v. Columbia Outdoor Advert., 974 F.2d 502, 507 (4th Cir.
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1992); Jefferies v. Phillips, 451 S.E.2d 21, 23 (S.C. Ct. App.
1994).
II. Fiduciary duty claim.
To establish a claim for aiding and abetting a breach
of fiduciary duty under South Carolina law, the Simmonses were
required to produce evidence indicating (1) the breach of a
fiduciary duty owed to the them, (2) Proxibid’s knowing
participation in the breach, and (3) resulting damages. Vortex
Sports & Entm’t, Inc. v. Ware, 662 S.E.2d 444, 448 (S.C. Ct.
App. 2008). Because “the gravamen of the claim is the
defendant’s knowing participation in the fiduciary’s breach,”
actual knowledge of duty and subsequent breach is required. Id.(internal quotation marks omitted); see also Gordon v. Busbee,
__ S.E.2d __, 2012 WL 89641, at *5 (S.C. Ct. App. 2012).
Assuming for the sake of argument that Danhauer
breached a fiduciary duty owed to the Simmonses, the Simmonses
have not established Proxibid’s knowledge of that duty and
breach by using the presumption that persons are charged with
knowledge of the law. Presumed knowledge of the law, with no
accompanying evidence of actual knowledge, is insufficient under
South Carolina law to establish actual notice or knowledge. See
Labruce v. North Charleston, 234 S.E.2d 866, 867 (S.C. 1977);
Strother v. Lexington Cnty. Recreation Comm’n, 479 S.E.2d 822,
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826 (S.C. Ct. App. 1996). Accordingly, as the Simmonses point
to no other evidence of Proxibid’s knowledge of Danhauer’s
alleged duty or breach, summary disposition of their fiduciary
duty claim was proper.
III. Tortious interference claim.
Under South Carolina law, a viable claim for tortious
interference with contractual relations requires proof of (1)
the existence of a contract, (2) the alleged wrongdoer’s
knowledge of the contract, (3) an intentional and unjustified
interference resulting in a breach of the contract, and (4)
damages. Eldeco, Inc. v. Charleston County Sch. Dist., 642
S.E.2d 726, 731 (S.C. 2007). Generally, where there is no
evidence suggesting that the actions of the alleged tortfeasor
were motivated by anything other than a pursuit or fulfillment
of his own contractual rights with a third party, there can be
no finding of intentional interference with contractual
relations. See Southern Contracting v. Brown Constr. Co., 450
S.E.2d 602, 604-06 (S.C. Ct. App. 1994).
Here, assuming a valid contract between the Simmonses
and Danhauer, we find that the Simmonses have failed to produce
evidence of Proxibid’s intent to interfere with that contract
sufficient to survive summary judgment. Without more, we can
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find no error in the district court’s judgment in favor of
Proxibid.
In light of our above conclusions, it is unnecessary
for us to address the district court’s determination regarding
Proxibid’s immunity under the Communications Decency Act, 47
U.S.C. § 230 (2006). We affirm the district court’s order
granting summary judgment in favor of Proxibid. We dispense
with oral argument because the facts and legal contentions are
adequately presented in the materials before the court and
argument would not aid the decisional process.
AFFIRMED
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