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State ex rel BP Products North America Inc. v. Ross5/31/2005
I.
Advanced Cleaning Technologies, Inc., and Brian Wandersee, president of ACT, brought suit against PDQ Manufacturing, Inc., BP Products North America, Inc., and Paul and Janet Faix, former employees of ACT. BP filed a motion for summary judgment, which was granted in part and denied in part. BP claimed that summary judgment was improperly denied as to the plaintiffs' claims of injurious falsehood because those claims were filed outside the two-year statute of limitations in section 516.140, RSMo 2000. This Court issued a preliminary writ.
The five-year statute of limitations from section 516.120 applies to plaintiffs' injurious falsehood claims. The two-year statute of limitations from section 516.140 applies to plaintiffs' defamation claims. Injurious falsehood protects pecuniary loss whereas defamation protects reputational injury. Accordingly, plaintiffs'claims for pecuniary damages are timely, but their claims for reputational injury are barred. The preliminary writ is made absolute in part and quashed in part.
II.
The uncontroverted facts of the underlying suit are as follows. ACT distributed car wash machines, supplies, and parts, and it serviced the machines. PDQ manufactured car wash machines. Sometime in 1997, PDQ and ACT contracted for ACT to distribute and service machines manufactured by PDQ.
In December 1997, BP ordered three car wash machines from PDQ. PDQ shipped the three machines to ACT. BP paid PDQ for all three machines and paid ACT a commission for all three sales. Two of these three machines were installed at BP gas stations in March and April 1998. The third machine remained at ACT's warehouse. The machine had been ordered for a planned BP station that was never built. In the meantime, the contract between PDQ and ACT expired on June 30, 1998.
In July 1999, the head of BP's corporate security contacted the Overland Police Department regarding the third car wash machine purchased by BP and shipped to ACT in December 1997. Two former ACT employees gave written statements to the police regarding the car wash machine. One of the former employees claimed that Wandersee and an ACT employee had instructed her to sell BP's machine.
A detective applied for a warrant to search ACT's warehouse. In his affidavit in support of the application for the search warrant, the detective wrote that one of the former employees claimed that Wandersee told her "that it was a free machine commandeered from ." The search warrant was signed and executed on July 26, 1999. Parts of BP's car wash machine were seized and released to the head of BP's corporate security.
The next day, Wandersee went to the police station with an ACT employee and an attorney. Wandersee and the employee were arrested for stealing more than $750 and booked, fingerprinted, and photographed. They were released that day pending application of warrants.
The police conducted further investigation at the request of the prosecutor, and the case was argued before the grand jury in May 2000. The grand jury indicted Wandersee for stealing more than $750, and he was arrested again. He was released later that night on bond. Depositions were taken in the case, but the prosecutor filed a nolle prosequi on November 6, 2000, to allow for further investigation. The prosecutor declined to prosecute the case because he said " here were problems with credibility of the witnesses, especially the lay witnesses."
Wandersee claimed he lost business contracts and people told him it was because of the police investigation. Also as a result of the police investigation in 1999, ACT's line of credit was frozen in September, and
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