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Janvrin v. Continental Resources, Inc.

United States District Court, D. South Dakota, Southern Division

June 30, 2017

JERRY JANVRIN d/b/a J&J TRUCKING, Plaintiff,
v.
CONTINENTAL RESOURCES, INC., an Oklahoma Corporation, Defendant.

          ORDER DENYING DEFENDANT'S RENEWED MOTION FOR JUDGMENT AS A MATTER OF LAW AND MOTION FOR A NEW TRIAL

          KAREN E. SCHREIER UNITED STATES DISTRICT JUDGE.

         Plaintiff, Jerry Janvrin, sued defendant, Continental Resources, for tortious interference with a business relationship alleging that Continental intentionally interfered with Janvrin's business relationship with CTAP, Inc. After the close of Janvrin's case in chief and again at the close of all the evidence, but before the jury returned a verdict, Continental moved for a judgment as a matter of law on Janvrin's claim. The court heard oral arguments and reviewed Continental's written brief and denied Continental's motion. Docket 85. Continental filed a Renewed Motion for Judgment as a Matter of Law and Motion for a New Trial.

         BACKGROUND

         Janvrin owned J&J Trucking, a business that provided hauling services in South Dakota, North Dakota, and Montana. Continental Resources is an oil and gas exploration company that owns well locations in South Dakota, North Dakota, Montana, and other states. Continental's well locations in Harding County, South Dakota are referred to as the “Buffalo District” and make up a small number of its overall well locations. Non-party CTAP, Inc., is a supplier of pipeline, casings, tubing, and other goods used by oil and gas companies. From 2010 to February of 2014, J&J Trucking was on a list of independent contractors qualified by CTAP to deliver loads to its customers. J&J Trucking only delivered to wells out of CTAP's Bowman, North Dakota yard. The Bowman yard delivered supplies to well locations in the Buffalo District and several other locations in North Dakota. On February 19, 2014, CTAP informed Janvrin that J&J Trucking was no longer on CTAP's list of qualified independent contractors and would no longer deliver loads to CTAP customers.

         At trial, Janvrin presented evidence that on Wednesday, February 19, 2014, [1] an article appeared in the Harding County newspaper describing an accident between a Continental employee who was driving a Continental vehicle and two cows on a county road north of Buffalo, South Dakota. The cows belonged to Roxy and David Niemi-Janvrin's sister and brother-in-law. Janvrin was paraphrased in the article expressing his belief that many drivers on the county road drive too fast for the road's conditions. Janvrin's theory of the case was that Continental induced or otherwise pressured CTAP to end its business relationship with J&J Trucking in retaliation for Janvrin's comment in the newspaper article. Continental claimed that it only asked CTAP not to have Janvrin deliver loads to its well locations in the Buffalo District, but that Janvrin was welcome to deliver to Continental's other well locations. Continental further claimed that it did not want Janvrin delivering to its locations in the Buffalo District because Janvrin was a safety risk.

         Janvrin presented testimony from several witnesses to show the timeline of events that led to his termination. After reading the article in the Harding County newspaper, Gordan Carlson, Continental's Buffalo District supervisor, testified that he believed that Janvrin's comments were disrespectful and he called Continental's Buffalo District unit engineer, Peter MacIntyre, and requested that MacIntyre prohibit Janvrin from providing trucking services to Continental. MacIntyre agreed to contact Ollis Anderson because Anderson was responsible for arranging how materials were delivered to well locations. After MacIntyre discussed the newspaper article with Anderson, Anderson called Stoney McCarrell, Vice President of Operations for CTAP. Anderson testified that he told McCarrell that he did not want Janvrin making deliveries to the Buffalo District, but that J&J was free to deliver to the rest of Continental's wells. McCarrell testified that Anderson told him that Continental did not want Janvrin to make deliveries to any of its well locations. Finally, Ron Spidahl testified that McCarrell called Spidahl and told him to take J&J Trucking out of the line up at the Bowman yard because McCarrell got a call from the “big guy.” The effect of J&J being taken out of the line-up was that J&J would no longer deliver any loads for CTAP out of the Bowman yard.

         There was conflicting testimony as to how much time passed between each communication. Carlson, MacIntyre, and Anderson all testified that several days or a week passed between the day the newspaper was published and the day Anderson called McCarrell. But Spidahl testified that J&J Trucking was removed from the list of haulers at the Bowman yard on February 20, 2014, and Janvrin testified that he received the phone call from Spidahl on the evening of February 19, 2014.

         To support his theory that Continental retaliated against Janvrin for his comments in the newspaper, Janvrin presented testimony from Spidahl that he later received a phone call from Duke Ochellar of CTAP that “there would be hell to pay” if Ochellar found out that Spidahl said something to Continental. Also, David Tilus, a Continental employee, testified that he overheard Carlson talking to another gentleman about J&J Trucking not delivering for CTAP anymore and later called Justin Till, a former Continental and J&J Trucking employee, to talk to him about it. While Tilus testified that he never said Carlson boasted about putting J&J Trucking out of business, Till testified that Tilus told him that Carlson boasted that he put J&J Trucking out of business.

         Continental renews its motion for judgment as a matter of law and moves for a new trial. Continental contends that the court improperly instructed the jury on the law and applied the incorrect standard to determine whether to submit punitive damages to the jury. Continental also argues that a reasonable jury could not find that the interference was intentional or improper, that Continental's conduct was the legal cause of Janvrin's injury, or that Janvrin's damages calculations were supported by competent evidence. Finally, Continental claims that the evidence conclusively established that Janvrin failed to mitigate his damages and that there is legally insufficient evidence to support an award of punitive damages.

         LEGAL STANDARD

         Judgment as a matter of law can be granted when “a party has been fully heard on an issue and there is no legally sufficient evidentiary basis for a reasonable jury to find for that party.” Fed.R.Civ.P. 50(a)(1). “The court views the evidence in the light most favorable to the nonmoving party.” Sip-Top, Inc. v. Ekco Group, Inc., 86 F.3d 827, 830 (8th Cir. 1996). “Judgment as a matter of law is appropriate ‘[w]hen the record contains no proof beyond speculation to support [a] verdict.' ” Arabian Agric. Servs. Co. v. Chief Indus., Inc., 309 F.3d 479, 482 (8th Cir. 2002).

         After a jury trial, the court may grant a new trial to any party on all or some of the issues. Fed.R.Civ.P. 59(a). The court should grant a new trial where “the verdict is against the ‘great weight' of the evidence, so that granting a new trial would prevent a miscarriage of justice.” Jacobs Mfg. Co. v. Sam Brown Co., 19 F.3d 1259, 1266 (8th Cir. 1994).

         I. The court's Jury Instruction No. 6 was a correct statement of the law.

         Continental contends that this court improperly instructed the jury as to South Dakota law. In Tibke v. McDougall, 479 N.W.2d 898, 908 (S.D. 1992), the South Dakota Supreme Court clarified the elements of a tortious interference with a business relationship. The Court stated that the elements are as follows: “(1) the existence of a valid business relationship or expectancy; (2) knowledge by the interferer of the relationship or expectancy; (3) an intentional and unjustified act of interference on the part of the interferer; (4) proof that the interference caused the harm sustained; and (5) damage to the party whose relationship or expectancy was disrupted.” Id. The South Dakota Supreme Court further explained that the previously stated elements more closely follow Restatement (Second) of Torts §§ 766 and 766B. Id.

         Continental argues that part of Jury Instruction No. 6 was an inaccurate statement of the law. The relevant part of the instruction states, “(1) Continental Resources has the right to refuse to do business with Jerry Janvrin and to exclude Jerry Janvrin from its property; (2) But Continental Resources cannot improperly interfere with Jerry Janvrin's business interest with CTAP.” Docket 77 at 8. Continental contends that the second part of the instruction was improper because it suggested that its absolute right to exclude Janvrin from its property and refuse to do business with Janvrin was a conditional right.

         Continental heavily relies on Johnson v. Schmitt, 309 N.W.2d 838, 839 (S.D. 1981), to support its argument that it had the absolute right to refuse to do business with Janvrin. The proposed jury instruction in Johnson that Continental relies on stated:

You are instructed that (appellants) have an absolute right to sell or not to sell water to any person. You are further instructed that there is no liability for procuring a breach of contract where such breach is caused by the exercise of an absolute right, that is, by an act which a person has a definite legal right to do.

Id. at 840. The trial court in Johnson did not give the above instruction because, while it found the legal theory was valid, it did not apply to the facts of the case, and the South Dakota Supreme Court agreed. Id. The legal theory relied on to formulate the above instruction is stated in Restatement (Second) of Torts § 773. Section 773 applies where a defendant admits that he intentionally and knowingly interfered with a contract or relationship but alleges that he did so in good faith and to protect a legal right.[2]

         Here, the legal theory stated in § 773 and the proposed Johnson instruction do not apply to these facts because Continental does not admit that it intentionally interfered with the CTAP-J&J Trucking business relationship. Instead, Continental adamantly denies that it intended to interfere with the relationship. Thus, the defense contemplated in § 773 of the Restatement did not apply to the facts of the case and was not relevant at trial. Instead this court referenced sections 776 and 766B for Jury Instruction No. 6.

         Continental argues that the court's instruction is not supported by any law in any jurisdiction and that it has an absolute right to refuse to do business with Jerry Janvrin. But the court's instruction is supported by law and Continental misconstrues what the instruction states. There were three different business relationships at play in this case. There was the J&J Trucking-Continental Resources relationship, the J&J Trucking-CTAP relationship, and the CTAP-Continental Resources relationship. The first part of Jury Instruction No. 6 instructs the jury that, as to the J&J Trucking- Continental relationship, Continental has a right to refuse to do business with J&J Trucking and a right to exclude J&J Trucking from its property. The second part of the instruction instructs the jury as to Continental's rights in relation to a different ...


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