No Sanctions Against Joshua Wright in His Now-Terminated Defamation Lawsuit Against His Sexual Misconduct Accusers

From Tuesday's opinion by Manuel A. Capsalis (Va. Cir. Ct. Fairfax County) in Wright v. Landry (a case that has been covered in several posts on this blog):

Plaintiff Joshua Wright is a former professor at George Mason University Antonin Scalia Law School …. He was distinguished for his scholarship and served as the Executive Director of the Global Antitrust Institute. He also managed a private consulting business, Plaintiff Lodestar Law and Economics …. In the summer of 2023, he resigned from his post at the Law School.

While a professor, he had romantic relationships with students. Allegations of sexual misconduct were brought to light by former students, Defendant Elyse Dorsey and Defendant Angela Landry. They publicly accused him of sexual harassment and sexual misconduct in addition to reporting the allegations to a Title IX investigator.

Wright does not dispute that he had an ongoing sexual relationship with Dorsey and Landry while they were students at the Law School. He claims that the relationships were consensual, lasting far beyond their graduation. Dorsey and Landry disagree with Wright's characterization of the relationship, citing the power imbalance between teachers and students.

Public discussion about this matter ensued. Law360, among other media outlets, published articles. Wright subsequently brought a lawsuit against Defendants. He claimed that their allegations of misconduct were false which tarnished his reputation and caused him substantial financial harm. The lawsuit contained a count of tortious interference, several counts of defamation, and counts of statutory and common law conspiracy. Plaintiffs prayed for a total of $108 million worth of damages in addition to injunctive relief prohibiting the publication or republication of the alleged defamatory statements.

Parties litigated this case extensively until Dorsey settled with Plaintiffs, and a nonsuit was taken on the eve of trial against Landry.

Landry moved for sanctions, basically claiming that the tortious interference claim and its damages demand were frivolous; but the court said no:

A tortious interference with business expectancy or contract claim requires:

(1) the existence of a valid contractual relationship or business expectancy;

(2) knowledge of the relationship or expectancy on the part of the interferor;

(3) intentional interference inducing or causing a breach or termination of the relationship or expectancy; and

(4) resultant damage to the party whose relationship or expectancy has been disrupted.

In this case, Plaintiffs and their counsel … had a reasonable belief to plead that Landry tortiously interfered.

Prior to any complaint being filed in this case, and before the first media coverage, Parties were embroiled in a Title IX investigation. At the direction of GMU, an investigator interviewed students. University officials questioned Wright. Parties even attended mediation. Throughout this time, Plaintiffs contend that they developed the belief that Landry and Dorsey were acting together.

On August 14, 2023, the Law360 article was published. Featured commentary was provided by Landry and Dorsey. As pleaded, Wright believed that his suspicions were confirmed that Defendants were working together and sharing information with each other. His over a million-dollar portfolio of business dissipated; Plaintiffs then pleaded that both Defendants were to blame…..

A more nuanced basis, independent of Defendants working together, also exists. Defendants individually shared a relationship with Wright that is inextricably intertwined with his business dealings. For example, Dorsey previously worked at Wright's company, Lodestar. Landry also discussed professional matters with Wright. Both Defendants, at one point or another, consulted Wright when making career decisions. The connection between Defendants, Plaintiffs' business, and the losses, provided a means for Plaintiffs to plead tortious interference ….

Whether Plaintiffs may ultimately prove their tortious interference claim against Landry is not for the Court to decide at this time. For the purposes of the present Motion, Landry must show that Plaintiffs and their counsel could not have formed a reasonable belief, after conducting a reasonable inquiry, that the pleadings [were factually and legally well-founded]. Based on the evidence received, this Court finds that Plaintiffs met the standard to allege a tortious interference claim against Landry. …

Landry also argues that… the amount [of damages] sought—$108 million—is unsupportable. The figure, she claims, caused her to needlessly increase the costs of her defense. Plaintiffs, on the other hand, argue that the ad damnum clause is merely to put Defendants on notice of the amount of damages sought. The amount pleaded, Plaintiffs point out, does not guarantee recovery in full; damages are a matter that should be argued at trial.

Plaintiffs are correct. Virginia Supreme Court Rule 3:2(c)(ii) requires the plaintiff to provide "the amount of damages sought." This is to provide the defendant "notice of the size and amount of the claim against her as she is entitled to notice of its nature." The rule, however, does not require a plaintiff to plead more than a lump sum of damages. In any event, a plaintiff may not recover more than the amount pleaded….

Wright testified at the hearing that he spoke with his attorneys about how he believed he was damaged. He stated:

I told, to the best of my recollection, what I told Mr. Cross was that I conferred with my counsel. I described each of the contractual relationships that Lodestar had or that I had individually, what I expected in my experience for those relationships to grow over time or stay the same, the future expectancy with those businesses and the nature of those relationships, how long I expected for those relationships to continue. And then I provided those figures and contracts and that additional qualitative information to my counsel, who put together the complaint.

Wright's testimony indicates that there were pre-filing discussions with counsel and that the damages figure was properly pleaded. Sanctions will not be imposed under these circumstances….

The court also rejected Landry's claim for attorney fees under the Virginia anti-SLAPP statute, which provides for such fees when a tort claim based on speech on matters of public concern is thrown out:

{Landry moved to dismiss the following statements on demurrer:

127. Specifically, in the context of her sexual relationship with Mr. Wright, Defendant Landry falsely stated that he "emotionally abused and manipulated [her] until he got what he wanted."

128. She falsely stated that she "does not believe she would have been in a relationship with him" absent the power dynamics, which is intended to convey that he subjected her to a nonconsensual relationship.

The Court overruled the demurrer as to paragraph 127 and dismissed paragraph 128 with prejudice.} …

Colloquially known as the Virginia Anti-SLAPP Statute, Virginia Code Section 8.01-223.2 was enacted to "weed out and deter lawsuits brought for the improper purpose of harassing individuals who are exercising their protected right to freedom of speech." …

In this case, the Court cannot impose Anti-SLAPP fees for four reasons: (1) the defamation count survived demurrer; (2) the statement was not dismissed pursuant to the statute because it was not even raised on demurrer; (3) this Court cannot now impose an additional ground of dismissal when two motions addressing the issue were already adjudicated; and (4) dismissal of any part of the lawsuit pursuant to the immunity is now moot…. A nonsuit ends the litigation. The day Plaintiffs exercised their statutory right to voluntarily dismiss the case, Landry filed the instant Motion. To the extent that the Motion requests that the immunity apply now, the Court will deny the Motion as moot. The litigation has ended. No finding of immunity can be made….

Jason C. Greaves, Stephen B. French, Lindsay R. McKasson, Benjamin North, and Parker Bowman (Binnall Law Group) and Jennifer Little (Jennifer Little Law) represent plaintiffs.