Readers may remember Tareq and Michaele Salahi from the national attention they gained in November 2009 when they crashed a White House state dinner in honor of India’s Prime Minister Manmohan Singh or from their run on the reality show “The Real Housewives of D.C.” The Salahis are no stranger to litigation, having gone through a messy divorce in 2012. Most recently, the Supreme Court of Virginia heard Mr. Salahi’s appeal from a decision of the Circuit Court of Warren County regarding claims against the couple’s former agent, DD Entertainment, LLC.
According to Mr. Salahi, he and his then wife had a verbal agreement to appear on reality T.V. shows, talk programs and other media outlets to promote their entertainment partnership, “The Salahis,” and they were to use the profits from the partnership for their mutual benefit. DD Entertainment acted as the Salahis’ agent and procured additional projects for them. Mr. Salahi alleged that DD Entertainment was aware of the couple’s business partnership and used improper means to interfere with the partnership by encouraging Mrs. Salahi to leave the enterprise and become the adulterous mistress of Journey guitarist Neal Schon in violation of Virginia’s adultery statute, Virginia Code § 18.2-365.
After his defamation and emotional distress claims were dismissed, Mr. Salahi filed an amended complaint in which he claimed DD Entertainment tortiously interfered with his business partnership with his former wife. The circuit court sustained DD’s demurrer, ruling that Virginia Code § 8.01-220 (which abolished actions for alienation of affection) barred the tortious interference claim. The court also found that Mr. Salahi failed to allege any conduct by DD sufficient to give rise to the claim. Mr. Salahi appealed.
The Supreme Court of Virginia, by unpublished order, found that the circuit court erred in granting the demurrer to the tortious interference claim. Virginia Code § 8.01-220 only bars an action where the plaintiff’s alleged injuries were due to the effect that the defendant’s conduct had upon the plaintiff’s marriage. An action where the plaintiff’s injuries would be compensable independent of his marital status is not barred. The question is whether the cause of action would exist even if the plaintiff were unmarried. The court found that Mr. Salahi’s alleged injuries were independent of his martial status. The contractual relationship at issue is the business relationship between the Salahis, as the damages sought by Mr. Salahi are the lost profits that would have been generated by the couple as The Salahis.
The court held also that the circuit court erred in finding that the tortious interference allegations failed to state a viable claim. The elements of a tortious interference claim are (1) the existence of a valid contractual relationship or business expectancy; (2) knowledge of the relationship or expectancy on the part of the interferer; (3) intentional interference inducing or causing a breach or termination of the relationship or expectancy; and (4) resultant damaged to the party whose relationship or expectancy has been disrupted. When a contract is terminable at will, the plaintiff must also allege and prove that the defendant employed improper methods.
Here, Mr. Salahi alleged the existence of a valid contractual relationship – the entertainment partnership between himself and Mrs. Salahi. He claimed that DD knew of the contract and interfered with it by encouraging Mrs. Salahi to leave. He further asserted that DD used numerous improper means including encouraging Mrs. Salahi to engage in adultery and breaching its fiduciary duty by paying only Mrs. Salahi the money it held for both of them and by unjustly enriching itself at the expense of the Salahis’ entertainment partnership. Mr. Salahi claimed that he lost income from at least three specific contracts as a result of DD’s actions. The court found that Mr. Salahi’s amended complaint contained sufficient allegations to support a prima facie case for tortious interference with a contract against DD.
One justice dissented, finding that Virginia Code § 8.01-220 bars Mr. Salahi’s claim for tortious interference to the extent it is based on DD’s alleged encouragement of adultery. The amended complaint alleges that DD tortiously interfered with the partnership by encouraging Mrs. Salahi to leave Mr. Salahi and become Neal Schon’s adulterous mistress. The dissenting justice found that this is the type of conduct that the General Assembly intended to exclude from civil liability when it enacted the statute. Additionally, the justice pointed out that the cause of action could not exist if Mr. Salahi were not married since his claim is based on the allegation that DD encouraged Mrs. Salahi to commit adultery–an allegation he could not make unless married. Further, the dissenting justice found that the alleged breach of fiduciary duty did not support an allegation of improper methods. Each partner is an agent of the partnership, so DD’s paying funds earned by the partnership to one partner would not be improper. Finally, even were the methods improper, Mr. Salahi did not demonstrate that DD’s actions caused termination of the partnership.