The Michigan Court of Appeals issued a favorable opinion in a complex commercial dispute, reversing the trial court’s decision and dismissing all claims against our client, with prejudice.
In a complex case that spanned more than six years in the trial court, Plaintiffs sought more than nine figures in damages, alleging tortious interference with a contract, tortious interference with a business expectancy, and civil conspiracy. The dispute arose from our client’s role in managing asbestos concerns following a significant water-loss event at a large commercial property in Dearborn, Michigan.
Plaintiffs alleged that our client, an industrial hygiene consulting firm, conspired with the property’s insurer to force tenants out of the building, thereby interfering with Plaintiffs’ management and redevelopment agreements. The case involved extensive discovery, multiple motions, and a heavily contested factual record.
The Appellate Ruling
In its opinion, the Court of Appeals concluded that all claims were barred by a broad settlement agreement and release executed years earlier between the property owner and its insurer. The court held that plaintiffs, although not signatories, were bound by the release as agents of the settling party and had given their control over the claim and settlement negotiations to the settling party under the alter ego principle.
The court also held that Plaintiffs failed to present evidence of a wrongful act. The panel found that our client’s conduct “arose out of concern of limiting building patrons’ exposure to asbestos,” a legitimate and safety-driven justification that defeated the tortious interference claims.
Legal and Practical Implications
This is a meaningful and important win for our client. It affirms that carefully drafted settlement agreements can and should be enforced to prevent re-litigation of resolved disputes. It also reinforces that actions taken in good faith to manage environmental risk do not amount to legal wrongdoing.
The ruling represents the culmination of years of work by our litigation team at both the trial and appellate levels. We’re proud to have achieved a complete dismissal of claims and a result that protects our client from further litigation exposure.
Article Authors
Nathan Scherbarth is a shareholder and team leader of the firm’s Appellate group. He also practices in the firm’s Business & Commercial, Construction, Employment, Eminent Domain, Insurance Defense, Insurance Coverage, and Municipal practice groups.
Stephanie Strycharz is a results-driven trial attorney with a track record of securing defense victories and offering sound counsel in complex insurance litigation.
