West Michigan Film LLC v. James W Metz II

STATE OF MICHIGAN
COURT OF APPEALS
WEST MICHIGAN FILM LLC, UNPUBLISHED
January 29, 2015
Plaintiff-Appellant,
v No. 319119
Ingham Circuit Court
JAMES W. METZ II, and DONOVAN MOTLEY LC No. 13-000649-NZ
Defendants-Appellees.
Before: TALBOT, C.J., and CAVANAGH and M. J. KELLY, JJ.
PER CURIAM.
Plaintiff, West Michigan Film LLC, appeals as of right an order granting defendants’
motions for summary disposition, dismissing claims of tortious interference with a business
relationship or expectancy on grounds of governmental immunity. We vacate and remand for
further proceedings.
In 2006, real estate developer John C. Buchanan, Jr. and his father co-owned Alpinist
Endeavors, LLC. Alpinist Endeavors owned a building that had been converted from a facility
where aircraft was built, to a condominium-type development for industrial and/or office use.
After several units remained unoccupied, Buchanan sought an investor interested in buying units
and using them as a film studio. Pursuant to MCL 208.1457, such investment might qualify for
an infrastructure tax credit. Joseph Peters, a real estate developer, was interested in making a
deal with Alpinist Endeavors and formed West Michigan Film LLC, the plaintiff in this matter.
Plaintiff would buy two units from Alpinist Endeavors for $40 million and then seek a $10
million tax credit as permitted under the statute. At some point, public accusations were made
that this project was a sham designed to dupe the State into issuing a $10 million tax credit,
which prompted a criminal investigation of the “Hangar 42” project. Defendants, Assistant
Attorney General James Metz and Investigator Donovan Motley, were assigned to the
investigation, which culminated in criminal charges being filed against Buchanan and Peters, the
principals, for attempted fraud. Although the charges were eventually dismissed for lack of
probable cause, plaintiff was never able to obtain the tax credit.
Subsequently, plaintiff filed this lawsuit against defendants Metz and Motley, bringing
one count of tortious interference with a business relationship or expectancy. Plaintiff alleged in
its complaint that defendants “conducted a baseless investigation designed to come to a
preordained false conclusion that a crime had been committed, and publicly and falsely accused
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the principal businessmen involved in the deal with crimes against the State.” Plaintiff set forth
defendants’ wrongful acts as including:
a. Conducting a criminal investigation that deliberately ignored exculpatory facts
to reach a preordained conclusion not supported by probable cause;
b. Making false and misleading statements to magistrates to induce the
magistrates to issue arrest warrants;
c. Arresting the principal members of West Michigan Film without probable
cause;
d. Providing false and misleading information to the Attorney General that formed
the basis of repeated announcements to the press that the deal was fraudulent and
that the principal parties were guilty of crimes;
e. Telling potential witnesses as the investigation ensued that it was already
known that Mr. Peters and Mr. Buchanan were crooks and defendants just needed
to talk to the witnesses to confirm what were established facts;
f. Misrepresenting to the court that issued the arrest warrant for Buchanan that
Buchanan had solicited a false appraisal from his appraiser in order to overstate
the value of the project.
Plaintiff further alleged that defendants’ actions “caused a breach or termination of [plaintiff’s]
business expectancy with the State, as no re-application for the tax credit certificate would be
considered during the investigation and prosecution, and the opportunity to complete the deal
expired before the prosecution ended.” Plaintiff also claimed that neither defendant was entitled
to governmental immunity under MCL 691.1407.
Defendant Motley responded to plaintiff’s complaint with a motion for summary
disposition pursuant to MCR 2.116(C)(7) and (C)(8). Defendant Motley acknowledged that he
was a special agent for the Michigan Department of Attorney General and was involved in the
investigation of this matter. But, defendant Motley argued, pursuant to Maiden v Rozwood, 461
Mich. 109, 134; 597 NW2d 817 (1999), he was entitled to absolute witness immunity regarding
plaintiff’s allegation that he made false statements to the court in judicial proceedings. Further,
he was entitled to qualified governmental immunity regarding plaintiff’s allegations arising from
his investigation of this matter as set forth in Ross v Consumers Power Co (On Rehearing), 420
Mich. 567, 633-634; 363 NW2d 641 (1984). See Odom v Wayne Co, 482 Mich. 459, 461; 760
NW2d 217 (2008). And, because the alleged acts were discretionary, were undertaken in good
faith (as he attested in his attached affidavit), during the course of his employment, and within
the scope of his authority, such acts could not give rise to plaintiff’s intentional tort action. See
id. at 480. Moreover, defendant Motley argued, plaintiff did not have an adequate business
expectancy to support its claim because the Film Office, which issued the tax credit, was vested
with broad discretion. Accordingly, defendant Motley argued, plaintiff’s intentional tort claim
against him should be summarily dismissed.
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Defendant Metz also responded to plaintiff’s complaint with a motion for summary
disposition pursuant to MCR 2.116(C)(7) and (C)(8). Defendant Metz acknowledged that he
was the Assistant Attorney General who prosecuted the underlying matter. But, he argued,
because the allegations against him were premised on his decision to prosecute the principals, he
was entitled to absolute prosecutorial immunity as set forth in Bischoff v Calhoun Co Prosecutor,
173 Mich. App. 802, 808; 434 NW2d 249 (1988), citing Imbler v Pachtman, 424 U.S. 409, 431; 96
S. Ct. 984; 47 L. Ed. 2d 128 (1976). Moreover, defendant Metz argued, plaintiff did not have an
adequate business expectancy to support its claim because the Film Office, which issued the tax
credit, was vested with broad discretion. Accordingly, defendant Metz argued, plaintiff’s
intentional tort claim against him should be summarily dismissed.
Plaintiff responded to defendant Motley’s motion for summary disposition, arguing that it
had a valid business relationship or expectancy with the State and defendant interfered with it
through various intentional actions which induced the State to terminate their relationship or
plaintiff’s expectancy, i.e., defendant’s intentional actions induced the State to refuse to issue the
agreed upon tax credit. In particular, plaintiff argued, defendant Motley committed the following
intentional acts of interference: (1) conducted an investigation that deliberately ignored facts
which negated probable cause, violating the Fourth Amendment, (2) fabricated evidence of
probable cause to secure arrest warrants and then made arrests without probable cause, and (3)
provided false information used in press releases and told people that the principals were crooks,
constituting the negligent tort of defamation. These acts were wrongful per se or, in the
alternative, were committed with malice; thus, defendant Motley was not entitled to
governmental immunity. See Bonelli v Volkswagen of America, Inc, 166 Mich. App. 483, 498-
499; 421 NW2d 213 (1988). Accordingly, plaintiff argued, defendant Motley was not entitled to
summary disposition.
Plaintiff also filed a response in opposition to defendant Metz’s motion for summary
disposition, arguing that it had a valid business relationship or expectancy with the State and
defendant interfered with it through various intentional actions which induced the State to
terminate their relationship or plaintiff’s expectancy, i.e., defendant’s intentional actions induced
the State to refuse to issue the agreed upon tax credit. In general, plaintiff argued that defendant
committed the following intentional acts of interference before the prosecution: (1) controlled
and participated in the preliminary investigation that deliberately ignored facts which negated
probable cause,1 (2) personally obtained information from witnesses that the appraisal of the
subject property was legitimate, contrary to sworn statements made by defendant Motley, (3)
personally spoke with Buchanan’s father who advised that Buchanan had permission to sell the
units to plaintiff, contrary to sworn statements made by defendant Motley, (4) falsely advised
defendant Motley that probable cause to arrest existed,2 and (5) provided false and defamatory
1
See Prince v Hicks, 198 F3d 607, 612 (CA 6, 1999).
2
See Harris v Bornhorst, 513 F3d 503, 509-510 (CA 6, 2008).
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information used in press releases.3 Accordingly, plaintiff argued, defendant Metz was not
entitled to summary disposition.
Following oral arguments, the trial court granted defendants’ motions for summary
disposition. The court held that defendant Metz was entitled to absolute prosecutorial immunity
under MCR 2.116(C)(7) because he was operating in his role as a prosecutor with regard to the
underlying investigation that gave rise to this civil case. “[T]he prosecutor has to investigate
every charge before they make a filing of some type.” Further, defendant Motley was entitled to
absolute witness immunity because plaintiff’s primary claim was that his testimony before the
magistrate in support of arrest warrants was false. The trial court also noted: “unless there is
some tie that somehow there’s a conspiracy that the Attorney General was just doing this so that
the Film Board would turn the application down, I don’t see how these individuals would be
interfering with any economic benefit of [plaintiff].” Thereafter, an order granting both
defendants’ motions pursuant to MCR 2.116(C)(7) and (C)(8) was entered and this appeal
followed.
First, plaintiff argues that defendant Metz was not entitled to absolute prosecutorial
immunity for his various intentional actions which interfered with plaintiff’s valid business
relationship or expectancy with the State; thus, the trial court erred when it granted his motion
for summary disposition under MCR 2.116(C)(7). We agree, in part.
This Court reviews de novo a trial court’s decision on a motion for summary disposition.
Odom, 482 Mich. at 466. Summary disposition may be granted under MCR 2.116(C)(7) when a
claim is barred because of immunity granted by law. In deciding such a motion, the court must
consider the pleadings and any affidavits, depositions, or other documentary evidence submitted
by the parties. MCR 2.116(G)(5); Holmes v Mich Capital Med Ctr, 242 Mich. App. 703, 706; 620
NW2d 319 (2000).
The parties agree that Michigan standards for prosecutorial immunity are the same as
federal standards: prosecutors are considered “quasi-judicial officers” and are entitled to
absolute immunity from civil liability for conduct committed within the scope of prosecutorial
duties or functions. See Bischoff, 173 Mich. App. at 807-808, citing Imbler, 424 U.S. at 431.
Absolute immunity applies when the alleged activities “were intimately associated with the
judicial phase of the criminal process.” Id. at 430. But, as the United States Supreme Court
explained in Buckley, 509 U.S. 259:
A prosecutor’s administrative duties and those investigatory functions that
do not relate to an advocate’s preparation for the initiation of a prosecution or for
judicial proceedings are not entitled to absolute immunity. We have not retreated,
however, from the principle that acts undertaken by a prosecutor in preparing for
the initiation of judicial proceedings or for trial, and which occur in the course of
his role as an advocate for the State, are entitled to the protections of absolute
immunity. Those acts must include the professional evaluation of the evidence
3
See Buckley v Fitzsimmons, 509 U.S. 259, 278; 113 S. Ct. 2606; 125 L. Ed. 2d 209 (1993).
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assembled by the police and appropriate preparation for its presentation at trial or
before a grand jury after a decision to seek an indictment has been made.
* * *
There is a difference between the advocate’s role in evaluating evidence
and interviewing witnesses as he prepares for trial, on the one hand, and the
detective’s role in searching for the clues and corroboration that might give him
probable cause to recommend that a suspect be arrested, on the other hand. When
a prosecutor performs the investigative functions normally performed by a
detective or police officer, it is “neither appropriate nor justifiable that, for the
same act, immunity should protect the one and not the other.” Thus, if a
prosecutor plans and executes a raid on a suspected weapons cache, he “has no
greater claim to complete immunity than activities of police officers allegedly
acting under his direction.” [Id. at 273-274 (internal citations omitted).]
Here, plaintiff alleged that defendant Metz interfered with its business relationship or
expectancy by intentionally engaging in wrongful acts, or by doing lawful acts with malice, for
the purpose of interfering with plaintiff’s relationship with the State. See Bonelli, 166 Mich. App.
at 498-499. Plaintiff’s specific allegations are set forth above and involve intentional acts of
interference by defendant Metz during his preliminary investigation, before charges were filed
against the principals. That is, defendant Metz was extensively involved in gathering evidence.
He determined which witnesses to interview, questioned witnesses personally, and observed the
questioning of other witnesses. He also acquired and reviewed documentary evidence. And,
plaintiff alleged, despite all of the exculpatory information that he acquired during his
investigation, defendant Metz falsely advised defendant Motley that probable cause to arrest
existed, and informed the media of numerous falsehoods.
As the United States District Court for the Eastern District of Michigan recently held in
the federal case arising from this matter, defendant Metz was not entitled to absolute
prosecutorial immunity for his participation in the investigation that was conducted prior to
criminal proceedings being commenced against the principals of the business transaction at issue
here.4 Buchanan v Metz, 6 F Supp 3d 730, 743 (ED Mich, 2014). Under the specific
circumstances presented in this case, where he was performing an investigative function much
like a detective who gathers and evaluates evidence, defendant Metz was not entitled to absolute
immunity. Id.5 And defendant Metz was not entitled to absolute immunity for advising
defendant Motley that probable cause to arrest existed. Id. at 743-744.6 However, defendant
4
Defendants submitted the federal court’s opinion as supplemental authority to this Court and
stated that: “[t]he occurrences giving rise to the federal case, and the allegations made by the
plaintiff against Metz in the federal case are identical to the occurrences and allegations involved
in the present case before this Court.”
5
Citing Buckley, 509 U.S. at 275-276 and Prince, 198 F3d at 612-613.
6
Citing Prince, 198 F3d at 613-615.
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Metz was entitled to absolute immunity with regard to his decisions to arrest and prosecute the
principals, including his participation in securing arrest warrants, as these actions were not
investigatory actions—they were prosecutorial in nature. Id. at 744.7 Accordingly, the trial
court’s decision to dismiss plaintiff’s intentional tort claim against defendant Metz pursuant to
MCR 2.116(C)(7), on the ground that he was entitled to absolute prosecutorial immunity, was
erroneous.
Second, plaintiff argues that defendant Motley was not entitled to absolute witness
immunity for his various intentional actions which interfered with plaintiff’s valid business
relationship or expectancy with the State; thus, the trial court erred when it granted his motion
for summary disposition under MCR 2.116(C)(7). We agree.
In dismissing plaintiff’s claim against defendant Motley, the trial court only considered
plaintiff’s allegation that he provided false testimony to magistrates to induce the issuance of
arrest warrants. And on appeal plaintiff does not challenge the court’s conclusion that defendant
Motley was entitled to absolute witness immunity with regard to this testimony; therefore, we
need not consider this decision. But, plaintiff argues on appeal, the trial court dismissed its claim
without considering the other “per se wrongful acts” or lawful acts committed with malice that
defendant Motley intentionally did for the purpose of interfering with plaintiff’s relationship with
the State. We agree. For example, the trial court never considered plaintiff’s allegations that
defendant Motley: (1) participated in the criminal investigation of the principals that was
purposefully designed to ignore exculpatory evidence that negated probable cause, (2) arrested
the principals without probable cause, (3) maliciously prosecuted the principals, and (4) made
public and false criminal accusations against the principals that were published through press
releases. Therefore, the trial court’s decision to dismiss plaintiff’s intentional tort claim against
defendant Motley pursuant to MCR 2.116(C)(7), on ground that he was entitled to absolute
witness immunity, was erroneous.
We note that the trial court’s order indicated that plaintiff’s claims were also dismissed
pursuant to MCR 2.116(C)(8), failure to state a claim, and the court’s legal rationale was limited
to: “unless there is some tie that somehow there’s a conspiracy that the Attorney General was
just doing this so that the Film Board would turn the application down, I don’t see how these
individuals would be interfering with any economic benefit of [plaintiff].” However, both
parties agree that the elements of tortious interference with a business relationship or expectancy
are: “the existence of a valid business relationship or expectancy, knowledge of the relationship
or expectancy on the part of the defendant, an intentional interference by the defendant inducing
or causing a breach or termination of the relationship or expectancy, and resultant damage to the
plaintiff.” Dalley v Dykema Gossett PLLC, 287 Mich. App. 296, 323; 788 NW2d 679 (2010),
quoting BPS Clinical Laboratories v Blue Cross & Blue Shield of Mich (On Remand), 217 Mich
App 687, 698-699; 552 NW2d 919 (1996). Therefore, plaintiff’s failure to plead that a
“conspiracy” existed was not fatal to its claims against defendants and the trial court’s decision
in this regard is also vacated.
7
Citing Burns v Reed, 500 U.S. 478, 484; 111 S. Ct. 1934; 114 L. Ed. 2d 547 (1991).
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Accordingly, we vacate the trial court’s order dismissing plaintiff’s claims of tortious
interference with a business relationship or expectancy pursuant to MCR 2.116(C)(7) and (C)(8),
and remand this matter for further proceedings consistent with this opinion.
Vacated and remanded. We do not retain jurisdiction.
/s/ Michael J. Talbot
/s/ Mark J. Cavanagh
/s/ Michael J. Kelly
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