`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE DISTRICT OF SOUTH CAROLINA
`GREENVILLE DIVISION
`
`)
`)
`)
`) C.A. No. 6:06-3466-HMH
`)
`)
`) OPINION & ORDER
`)
`
`))
`
`)
`)
`
`))
`
`))
`
`)
`
`))
`
`)
`)
`
`Advantage Inspection International,
`LLC,
`
`
`
`Plaintiff,
`
` vs.
`
`Wayne Sumner d/b/a VIP Inspection
`and/or Vision Reporting Systems,
`
` Defendant/
` Third-Party
` Plaintiff,
`
`vs.
`
`Thomas Brent Skidmore and Sonya
`Skidmore,
`
`Third-Party
`Defendants.
`
`This matter is before the court on Advantage Inspection International, LLC’s
`
`(“Advantage”) motion for partial summary judgment. For the reasons set forth below, the court
`
`grants in part and denies in part Advantage’s motion.
`
`I. FACTUAL AND PROCEDURAL BACKGROUND
`
`Advantage provides home inspection and warranty services. (Am. Compl. ¶ 1.)
`
`Advantage alleges that it is the exclusive licensee of copyrights in a standardized report, known
`
`as the Advantage Home Inspection Report (“Advantage Report”), and in the software
`
`(“Advantage Software”) developed for creating the Report. (Id. ¶¶ 2-3.) Advantage allows its
`
`franchisees who provide home inspection services to use the Advantage Software to generate
`
`
`
`6:06-cv-03466-HMH Date Filed 01/15/08 Entry Number 113 Page 2 of 15
`
`Advantage Reports. (Id. ¶ 21.) Specifically, the Advantage Software allows home inspectors to
`
`generate a standardized home inspection report by choosing from a variety of predetermined
`
`descriptions that identify and describe any damage or needed repairs observed at the house being
`
`inspected. (Id. ¶ 11.)
`
`Advantage alleges that it is the exclusive licensee of U.S. Copyright TX 3-375-097 for
`
`“The Advantage Home Inspection Report,” which protects the arrangement, format, and
`
`appearance of the Report, and of U.S. Copyright TXu 1-069-095 for “Advantage Inspection
`
`Software and Training System,” (“2001 Copyright”) which protects certain aspects of the
`
`Advantage Software. (Id. ¶¶ 12, 14; Pl.’s Mem. Supp. Mot. Compel 2.) In addition, Advantage
`
`claims that on July 24, 2007, it filed the Copyright Application Form TX for “The 2005
`
`Advantage Inspection, Inc. Software,” which protects the source and object code of the 2005
`
`version of the Advantage Software. (Am. Compl. ¶¶ 16-17.) Wayne Sumner (“Sumner”) asserts
`
`that this copyright was registered on August 28, 2007, as TX 6-595-047. (Def.’s Mem. Opp’n
`
`Pl.’s Mot. Summ. J. 2.)
`
`Thomas Brent Skidmore (“Mr. Skidmore”) originally created the first version of the
`
`Advantage Software around 1992. (Pl.’s Mem. Supp. Summ. J. 2.) From approximately
`
`January 5, 2001, to October 26, 2005, one of Advantage’s affiliate companies, Advantage
`
`Systems, ASP, LLC hired and paid Sumner to upgrade the Advantage Software to provide it with
`
`the capability of converting paper-based reports to PDF files that could be electronically
`
`delivered and manipulated. (Am. Compl. ¶ 24.) Advantage alleges that in return for his work,
`
`Sumner received pay and a membership interest in Advantage Systems ASP, LLC. According to
`
`Advantage, on July 23, 2003, Sumner assigned “the full and exclusive right” to his
`
`2
`
`
`
`6:06-cv-03466-HMH Date Filed 01/15/08 Entry Number 113 Page 3 of 15
`
`improvements to the software to Mr. Skidmore. (Pl.’s Mem. Supp. Summ. J. 2.) However,
`
`Sumner alleges that this assignment was fraudulently induced and did not cover the 2001
`
`Copyright. (Am. Third-Party Compl. ¶¶ 27-31.)
`
`According to Advantage, Sumner was unable to create a fully functional software system.
`
`(Am. Compl. ¶ 25.) Consequently, in September 2005, Advantage informed Sumner that while
`
`he would not be terminated, it intended to hire a third-party programmer to finalize the software
`
`upgrade. (Id. ¶ 30.) However, Sumner resigned in October 2005. (Id. ¶ 31.)
`
`Advantage alleges that shortly after resigning, Sumner began doing business as Vision
`
`Reporting Systems and/or VIP Inspections. (Id. ¶ 36.) As part of his business, Sumner began
`
`selling software entitled “Vision Reporting System Demo Version 2.3” (“Vision Software”). (Id.
`
`¶ 40.) Advantage alleges that the Vision Software is a direct copy of the Advantage Software,
`
`and that the Vision Software generates reports that infringe the Advantage Report. Based on
`
`these allegations, Advantage has asserted claims of copyright infringement, contributory
`
`infringement, temporary and permanent injunctions, interference with actual contractual
`
`relations, and common law unfair competition against Sumner. (Am. Compl.¶¶ 76-121.)
`
`Sumner alleges that over the past fourteen months, Mr. Skidmore and Sonya Skidmore
`
`(“Mrs. Skidmore”) (collectively “Skidmores”), as Advantage’s agents, have made false and
`
`defamatory statements about him, resulting in the loss of existing and prospective contracts.
`
`(Countercl. ¶¶ 17-34.) Sumner has asserted counterclaims for fraud in the inducement, slander,
`
`intentional interference with existing contractual relations, tortious interference with prospective
`
`contractual relations, and declaratory judgment. (Countercl. ¶¶ 1-39.)
`
`3
`
`
`
`6:06-cv-03466-HMH Date Filed 01/15/08 Entry Number 113 Page 4 of 15
`
`On November 23, 2007, Advantage filed a motion for partial summary judgment.
`
`Sumner responded on December 11, 2007, and Advantage replied on December 17, 2007.
`
`II. DISCUSSION OF LAW
`
`A. Summary Judgment
`
`Summary judgment is appropriate only “if the pleadings, depositions, answers to
`
`interrogatories, and admissions on file, together with the affidavits, if any, show that there is no
`
`genuine issue as to any material fact and that the moving party is entitled to a judgment as a
`
`matter of law.” Fed. R. Civ. P. 56(c). Rule 56(c) mandates entry of summary judgment “against
`
`a party who fails to make a showing sufficient to establish the existence of an element essential
`
`to that party’s case.” Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986).
`
`In deciding whether there is a genuine issue of material fact, the evidence of the
`
`non-moving party is to be believed and all justifiable inferences must be drawn in his favor. See
`
`Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986). However, “[o]nly disputes over facts
`
`that might affect the outcome of the suit under the governing law will properly preclude the entry
`
`of summary judgment. Factual disputes that are irrelevant or unnecessary will not be counted.”
`
`Id. at 248.
`
`Moreover, “[w]hen a motion for summary judgment is made and supported as provided in
`
`this rule, an adverse party may not rest upon mere allegations or denials of the adverse party’s
`
`pleading, but the adverse party’s response, by affidavits or as otherwise provided in this rule,
`
`must set forth specific facts showing that there is a genuine issue for trial.” Fed. R. Civ. P. 56(e).
`
`With respect to this burden, “it is the responsibility of the plaintiff, not the court, to identify with
`
`particularity the evidentiary facts existing in the record which can oppose the defendant’s
`
`4
`
`
`
`6:06-cv-03466-HMH Date Filed 01/15/08 Entry Number 113 Page 5 of 15
`
`summary judgment motion.” Malina v. Baltimore Gas & Elec. Co., 18 F.Supp. 2d 596, 604
`
`(D. Md. 1998).
`
`B. Advantage’s Claims
`
`1. Copyright Infringement
`
`Advantage moves for summary judgment on its claim that Sumner infringed its 2001
`
`Copyright. (Pl.’s Mem. Supp. Summ. J. 4-19.) “In order to prove copyright infringement, a
`
`plaintiff must show that it owns a valid copyright, and it must establish that the defendant
`
`engaged in unauthorized copying of the work protected by the copyright.” Nelson-Salabes, Inc.
`
`v. Morningside Dev., LLC, 284 F.3d 505, 513 (4th Cir. 2002). Mr. Skidmore’s copyright
`
`certificate is prima facie evidence of copyright ownership and validity. See M. Kramer Mfg. Co.
`
`v. Andrews, 783 F.2d 421, 434 (4th Cir. 1986) (A copyright, “granted by the Copyright Office, is
`
`prima facie proof of the validity of plaintiff’s copyright, including the existence of the elements
`
`of originality and fixation.”). “Where direct evidence of copying is lacking, plaintiff may prove
`
`copying by circumstantial evidence in the form of proof that the alleged infringer had access to
`
`the work and that the supposed copy is substantially similar to the author’s original work.”
`
`Bouchat v. Baltimore Ravens, Inc., 241 F.3d 350, 353-54 (4th Cir. 2001).
`
`Sumner does not dispute that he had access to the 2001 Copyright or that his Vision
`
`Software is substantially similar to the 2001 Copyright. (Def.’s Mem. Opp’n Pl.’s Mot. Summ.
`
`J. 4-22.) However, Sumner does dispute the ownership and validity of the 2001 Copyright.
`
`Sumner argues that he is a co-author of the 2001 Copyright and cannot infringe upon his
`
`own copyright. (Id. 4.) Advantage concedes that while a genuine issue of material fact exists
`
`over whether Sumner is a co-author of the 2001 Copyright, there is no dispute concerning
`
`5
`
`
`
`6:06-cv-03466-HMH Date Filed 01/15/08 Entry Number 113 Page 6 of 15
`
`ownership because Sumner assigned, through a written agreement, any rights that he have had to
`
`the 2001 Copyright. (Pl.’s Mem. Supp. Summ. J. 5-6.) It is undisputed that on July 23, 2002,
`
`Sumner executed an assignment (“Assignment”), assigning “the full and exclusive right to the
`
`said invention . . . and the entire right, title and interest in and to any and all Letters Patent of the
`
`United States . . . .” (Id. Ex. E (Assignment 1).) The “said invention” is identified as “certain
`
`new and useful improvements in INTEGRATED HOME INSPECTION AND HOME
`
`WARRANTY SYSTEM for which Provisional Patent Application No. 60/314,462 has been
`
`filed on August 23, 2001, and for which a utility patent application is being filed herewith[.]”
`
`(Id.)
`
`Pursuant to 17 U.S.C. § 204(a), “[a] transfer of copyright ownership . . . is not valid
`
`unless an instrument of conveyance . . . is in writing and signed by the owner of the rights
`
`conveyed . . . .” Further, the written conveyance need not explicitly use the word “copyright” to
`
`be valid so long as the conveyance explicitly or implicitly conveys the rights protected with a
`
`copyright. See Armento v. Laser Image, Inc., 950 F. Supp. 719, 732-34 (W.D.N.C. 1996)
`
`(holding that an assignment giving a party “the right to reproduce a work and the right to control
`
`its reproduction” sufficient to convey a copyright. Id. at 733); Schiller & Schmidt, Inc. v.
`
`Nordisco Corp., 969 F.2d 410, 413 (7th Cir. 1992) (holding that an agreement whose “wording
`
`leaves little doubt that [the transferor] sold all the assets . . . tangible and intangible alike” was
`
`sufficient to transfer copyrights). However, courts have held that “the terms of any writing
`
`purporting to transfer copyright interests . . . must be clear” and “any ambiguity concerning the
`
`alleged transfer must be interpreted in favor of the original copyright holder.” Bieg v.
`
`6
`
`
`
`6:06-cv-03466-HMH Date Filed 01/15/08 Entry Number 113 Page 7 of 15
`
`Hovnanian Enters., Inc., 157 F. Supp. 2d 475, 480 (E.D. Pa. 2001) (internal quotation marks and
`
`citations omitted).
`
`Pursuant to these standards, it cannot be said that the Assignment at issue clearly and
`
`unambiguously transferred Sumner’s rights to the 2001 Copyright. On its face, the Assignment
`
`purports to relate to the invention covered by the patent application and does not reference the
`
`2001 Copyright or any rights normally associated with a copyright. (Pl.’s Mem. Supp. Summ. J.
`
`Ex. E (Assignment 1).) Further, a review of the patent claim reveals that while the patent
`
`application and the 2001 Copyright both generally relate to the same subject, namely computer-
`
`generated home inspection reports, they could not be said to necessarily describe the same
`
`“invention.” (Id. Ex. B (Patent Application 5-6) & Ex. E (Assignment 1).) Specifically, while
`
`the patent application, in part, covers the idea of a system utilizing computer readable
`
`instructions for recording home inspection observations, the 2001 Copyright covers a specific
`
`expression embodying that idea. (Id.) Therefore, a genuine issue of material fact exists
`
`regarding ownership of the patent based on the Assignment.
`
`In addition, Advantage argues that it is an undisputed fact that Sumner transferred his
`
`rights in the 2001 Copyright in exchange for an ownership interest in Advantage Systems ASP,
`
`LLC. (Id. 6; Pl.’s Reply Supp. Summ. J. 2.) While it is undisputed that Sumner accepted a ten
`
`percent ownership interest in Advantage Systems in exchange for his contributions to the
`
`Advantage Software, it does not necessarily follow that Sumner intended to relinquish, in
`
`addition, any interest he might have in the 2001 Copyright resulting, in part, from those
`
`contributions. Therefore, summary judgment on Advantage’s copyright infringement claim is
`
`7
`
`
`
`6:06-cv-03466-HMH Date Filed 01/15/08 Entry Number 113 Page 8 of 15
`
`inappropriate on this ground as well. Based on the foregoing, Advantage’s motion for summary
`
`judgment on its copyright infringement claim is denied.
`
`2. Contributory Infringement and Injunctive Relief
`
`Advantage moves for summary judgment on its claims of contributory infringement and
`
`injunctive relief. (Pl.’s Mem. Supp. Summ. J. 19.) Sumner argues that because “questions of
`
`fact and law remain regarding the copyrighted software, its ownership, its originality and the
`
`plaintiff assignor’s obligations under the Copyright Act,” Advantage’s motion for summary
`
`judgment on these claims should be denied. (Def.’s Mem. Opp’n Pl.’s Mot. Summ. J. 22.) For
`
`the reasons set forth above in the discussion of Advantage’s copyright infringement claim, the
`
`court finds that genuine issues of material fact regarding ownership of the 2001 Copyright
`
`remain. Therefore, Advantage’s motion for summary judgment on its contributory infringement
`
`and injunctive relief claims is denied.
`
`3. Duty Not to Compete
`
`Advantage moves for summary judgment on its claim of unfair competition. (Pl.’s Mot.
`
`Summ. J. 1.) In support of its motion, Advantage asserts that as one of its members, Sumner
`
`owes a duty of loyalty to Advantage and to its other members, and that Sumner is breaching this
`
`duty by competing directly with Advantage. (Pl.’s Mem. Supp. Summ. J. 20-21.) However,
`
`Advantage’s operating agreement (“Operating Agreement”) provides that “[a] member who is
`
`not also a Manager owes no duties to the Company or the Members solely by reason of being a
`
`member . . . .” (Def.’s Mem. Opp’n Pl.’s Mot. Summ. J. Ex. 15 (Operating Agreement 14).)
`
`There is no evidence that Sumner is a manager of Advantage, as defined in the Operating
`
`Agreement, and Advantage has not challenged the validity of the Operating Agreement.
`
`8
`
`
`
`6:06-cv-03466-HMH Date Filed 01/15/08 Entry Number 113 Page 9 of 15
`
`Pursuant to Delaware law, which the parties agree applies, “[t]o the extent that, at law or in
`
`equity, a member . . . has duties (including fiduciary duties) to a limited liability company or to
`
`another member . . . , the member’s . . . duties may be . . . restricted or eliminated by provisions
`
`in the limited liability company agreement . . . .” Del. Code tit. 6 § 18-1101(c). Advantage does
`
`not dispute Sumner’s claim that the Operating Agreement eliminated his duty not to compete
`
`with Advantage. Therefore, Advantage’s motion for summary judgment on its claim of unfair
`
`competition is denied.
`
`C. Sumner’s Counterclaims
`
`1. Fraudulent Inducement
`
`First, Advantage moves for summary judgment on Sumner’s claim of fraudulent
`
`inducement. (Pl.’s Mem. Supp. Summ. J. 21-28.)
`
`The proponent of a claim of fraud in the inducement to enter into a contract must
`demonstrate: (1) a representation, (2) its falsity, (3) its materiality, (4) knowledge
`of its falsity or reckless disregard of its truth or falsity, (5) intent that the
`representation be acted upon, (6) the hearer’s ignorance of its falsity, (7) the
`hearer’s reliance on its truth, (8) the hearer’s right to rely thereon, and (9) the
`hearer’s consequent and proximate injury. The failure to prove any one of these
`elements is fatal to the claim.
`
`Parker v. Shecut, 531 S.E.2d 546, 558 (S.C. Ct. App. 2000) (internal citations omitted), rev’d on
`
`other grounds, 562 S.E.2d 620 (S.C. 2002).
`
`Sumner alleges that Advantage, by and through its agents, fraudulently induced him to
`
`assign his rights in the patent application to Advantage. (Countercl. ¶¶ 1-16.) Specifically,
`
`Sumner alleges that “sometime prior to July 2002, Advantage and Advantage Warranty agreed to
`
`sell interests in the businesses to Don Hachenberger [(“Hachenberger”)].” (Id. ¶ 7.) According
`
`to Sumner, “a condition of Hachenberger’s investment was that Advantage have ownership of all
`
`9
`
`
`
`6:06-cv-03466-HMH Date Filed 01/15/08 Entry Number 113 Page 10 of 15
`
`the intellectual property related to Advantage’s and its affiliated business entities’ ongoing
`
`businesses.” (Id. ¶ 9.) Consequently, Sumner alleges that in July 2002, the Skidmores, as
`
`Advantage’s agents, induced him to assign his ownership interest in the patent application to
`
`Mr. Skidmore by fraudulently “fail[ing] to disclose to Sumner prior to the transfer of his interest
`
`in the patent, that Advantage intended to sell a majority stake in Advantage after his transfer.”
`
`(Id. ¶ 14.) In addition, Sumner alleges in his response to Advantage’s motion for summary
`
`judgment that he considered Douglas Kim (“Kim”) to be his attorney and that the Skidmores
`
`“exploited” this belief to induce him to assign his interest in the patent. (Def.’s Mem. Opp’n
`
`Pl.’s Mot. Summ. J. 26.) Finally, according to Sumner, Advantage and Kim failed “to inform
`
`Sumner of the likelihood that his shares would become worthless after the assignment . . . .” (Id.
`
`27.)
`
`Advantage argues that Sumner’s claim for fraudulent inducement is barred by the statute
`
`of limitations. In South Carolina, the statute of limitations for an action alleging fraud is three
`
`years. S.C. Code Ann. § 15-3-530(7) (2005). The statute of limitations “does not begin to run
`
`until discovery of the fraud itself or of such facts as would have led to the knowledge thereof, if
`
`pursued with reasonable diligence.” Burgess v. Am. Cancer Soc’y, S.C. Div., Inc., 386 S.E.2d
`
`798, 799 (S.C. Ct. App. 1989) (internal quotation marks omitted). The undisputed evidence is
`
`that Sumner learned of the agreement to sell an ownership interest in “Advantage and Advantage
`
`Warranty” a “few days” after the July 23, 2002, meeting during which he executed the
`
`assignment. (Pl.’s Mem. Supp. Summ. J. Ex. D (Sumner Depo. 71-72).) Thus, this is the date
`
`on which Sumner discovered the alleged fraud, which triggered the running of the statute of
`
`limitations. Sumner’s argument that he did not discover additional facts connected with the
`
`10
`
`
`
`6:06-cv-03466-HMH Date Filed 01/15/08 Entry Number 113 Page 11 of 15
`
`alleged fraud until later is misplaced as his “actual . . . knowledge of facts or circumstances,
`
`indicative of fraud, trigger[ed] a duty on [his] part to exercise reasonable diligence in
`
`investigating and, ultimately, in pursuing a claim arising therefrom.” Id. at 800.
`
`In addition, Sumner argues that Advantage should be estopped from asserting the statute
`
`of limitations “because of [its] actions and the actions of [its] attorneys.” (Def.’s Mem. Opp’n
`
`Pl.’s Mot. Summ. J. 28.) The “actions” referred to by Sumner are apparently the same as those
`
`that provide the basis for his fraudulent inducement claim as set forth above.
`
`“A defendant may be estopped from claiming the statute of limitations as a defense if the
`
`delay that otherwise would give operation to the statute had been induced by the defendant’s
`
`conduct.” RWE NUKEM Corp. v. ENSR Corp., 644 S.E.2d 730, 734 (S.C. 2007) (internal
`
`quotation marks and alterations omitted). “The inducement may consist of an express
`
`representation that the claim will be settled without litigation or conduct that suggests a lawsuit
`
`is not necessary.” Id. Sumner presents no evidence of any such conduct or any other conduct by
`
`Advantage that induced Sumner’s delay in bringing his fraudulent inducement claim after his
`
`discovery of the alleged fraud in July 2002. Therefore, Sumner’s claim is barred by the three-
`
`year statute of limitations, and Advantage is entitled to summary judgment on Sumner’s claim of
`
`fraudulent inducement.
`
`2. Intentional Interference with Existing Contractual Relations
`
`Second, Advantage moves for summary judgment on Sumner’s claim for intentional
`
`interference with existing contractual relations. (Pl.’s Mem. Supp. Summ. J. 28-31.) In order to
`
`prove a prima facie case of intentional interference with existing contractual relations, Sumner
`
`must prove the following elements: “(1) the contract; (2) the wrongdoer’s knowledge thereof;
`
`11
`
`
`
`6:06-cv-03466-HMH Date Filed 01/15/08 Entry Number 113 Page 12 of 15
`
`(3) his intentional procurement of its breach; (4) the absence of justification; and (5) damages
`
`resulting therefrom.” DeBerry v. McCain, 274 S.E.2d 293, 296 (S.C. 1981).
`
`Sumner alleges that Advantage, “by and through its agents, made defamatory statements
`
`to Sumner’s clients, tortuously [sic] interfering with his contractual relations.” (Countercl.
`
`¶ 25.) Advantage moves for summary judgment on the ground that Sumner fails to present
`
`evidence of any contracts that were breached as a result of the Skidmores’ allegedly defamatory
`
`statements. (Pl.’s Mem. Supp. Summ. J. 28-31.) In his response, Sumner points to two contracts
`
`that were breached as a result of the Skidmores’ statements.
`
`First, Sumner asserts that he had “a verbal agreement with Mr. [Robert] Sams [(“Sams”)]
`
`to distribute his business cards to potential buyers as a home inspector referral.” (Def.’s Mem.
`
`Opp’n Pl.’s Mot. Summ. J. 29.) However, Sumner fails to allege or present evidence of any
`
`consideration on his part to support Sams’s agreement to distribute his business cards, and
`
`consequently fails to assert allegations sufficient to support a finding that a contract existed. See
`
`Rabon v. State Fin. Corp., 26 S.E.2d 501, 502 (S.C. 1943) (“[N]o contract is complete without a
`
`valid, legal consideration.”). In addition, Sumner fails to present evidence that Advantage knew
`
`of his agreement with Sams and intentionally procured its breach. (Id. & Ex. 2 (Sumner Decl.
`
`¶¶ 32-34).) In fact, Sumner refers to the statements as “reckless behavior.” (Def.’s Mem. Opp’n
`
`Pl.’s Mot. Summ. J. 30) However, to prove a prima facie case, Sumner is required to prove the
`
`intentional procurement of the breach of a known contract. See DeBerry, 274 S.E.2d at 296.
`
`Therefore, to the extent Sumner supports his intentional interference with existing contractual
`
`relations claim on his “agreement” with Sams, his claim is subject to summary judgment.
`
`12
`
`
`
`6:06-cv-03466-HMH Date Filed 01/15/08 Entry Number 113 Page 13 of 15
`
`Second, Sumner alleges that the Skidmores’ allegedly defamatory statements resulted in
`
`the breach of his contract with Mr. Nick Gromicko, who is president of the National Association
`
`of Certified Home Inspectors. (Def.’s Mem. Opp’n Pl.’s Mot. Summ. J. 30.) However, as with
`
`Sumner’s agreement with Sams, Sumner fails to allege or provide any evidence that Advantage
`
`or its agents knew of the alleged contract and intentionally interfered with it. (Id. 30-31 & Ex. 2
`
`(Sumner Decl. ¶¶ 32-34).) Therefore, Sumner has presented insufficient evidence to create a
`
`genuine issue of material fact and Advantage’s motion for summary judgment on Sumner’s
`
`claim for intentional interference with existing contractual relations is granted.
`
`3. Intentional Interference with Prospective Contractual Relations
`
`Finally, Advantage moves for summary judgment on Sumner’s claim of intentional
`
`interference with prospective contractual relations. (Pl.’s Mem. Supp. Summ. J. 31-34.) In order
`
`to prove a claim of intentional interference with existing contractual relations, Sumner must
`
`prove “(1) the defendant intentionally interfered with the plaintiff’s potential contractual
`
`relations; (2) for an improper purpose or by improper methods; (3) causing injury to the
`
`plaintiff.” Crandall Corp. v. Navistar Int’l Transp. Corp., 395 S.E.2d 179, 180 (S.C. 1990).
`
`Further, “a cause of action for intentional interference with prospective contractual relations
`
`generally stands following the loss of an identifiable contract or expectation” and “[t]he plaintiff
`
`must actually demonstrate . . . that he had a truly prospective (or potential) contract with a third
`
`party.” United Educ. Distribs., LLC v. Educ. Testing Serv., 564 S.E.2d 324, 328-29 (S.C. Ct.
`
`App. 2002). Thus, the potential “contracts cannot be speculative” and “the mere hope of a
`
`contract is insufficient.” Id. at 330.
`
`13
`
`
`
`6:06-cv-03466-HMH Date Filed 01/15/08 Entry Number 113 Page 14 of 15
`
`Sumner alleges that Advantage, by and through its agents, “made repeated defamatory
`
`statements to Sumner’s potential clients throughout the upstate of South Carolina, including
`
`statements made at the South Carolina Association of Realtors Convention.” (Countercl. ¶ 31.)
`
`Advantage moves for summary judgment on the ground that Sumner has failed to identify any
`
`potential contracts that were disrupted by the allegedly defamatory statements made by
`
`Advantage’s agents. (Pl.’s Mem. Supp. Summ. J. 31-34.) In his response, Sumner does not
`
`identify any prospective contracts, but generally asserts that his claim is not subject to summary
`
`judgment because the alleged statements were made “to a group that is a primary source of
`
`business for vendors in the home inspection business (2006 South Carolina Association of
`
`Realtors Convention)” and “in the defendant’s business community.” (Def.’s Mem. Opp’n Pl.’s
`
`Mot. Summ. J. 31.) These allegations, however, support nothing more than “the mere hope of a
`
`contract” and are insufficient to support a claim of intentional interference with prospective
`
`contractual relations. United Educ. Distribs., LLC, 564 S.E.2d at 330. Therefore, Advantage’s
`
`motion for summary judgment on Sumner’s intentional interference with prospective contractual
`
`relations claim is granted. Based on the foregoing, Advantage’s motion for summary judgment
`
`is granted in part and denied in part.
`
`14
`
`
`
`6:06-cv-03466-HMH Date Filed 01/15/08 Entry Number 113 Page 15 of 15
`
`It is therefore
`
`ORDERED that the Plaintiff’s motion for partial summary judgment, docket number 81,
`
`is granted in part and denied in part.
`
`IT IS SO ORDERED.
`
`Greenville, South Carolina
`January 15, 2008
`
`s/Henry M. Herlong, Jr.
`United States District Judge
`
`15