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Boyer v. Health Grades, Inc.

Supreme Court of Colorado, En Banc

June 1, 2015

Christopher Boyer and Patrick Singson, Petitioners:
v.
Health Grades, Inc., a Colorado corporation, Respondent:

Certiorari to the Colorado Court o f Appeals. Court of Appeals Case No. 11CA1829.

Judgment Reversed.

SYLLABUS

Boyer and Singson, defendants in a suit brought by Health Grades, petitioned for review of the court of appeals' judgment declining to affirm a favorable jury verdict on their counterclaim for abuse of process. The court of appeals remanded to the district court and ordered reversal of the verdict unless that court were to find that the claims initially brought by the plaintiff, Health Grades, were devoid of reasonable factual support or had no cognizable basis in law, in accordance with the appellate court's understanding of the mandate of Protect Our Mountain Environment v. District Court (POME), 677 P.2d 1361 (Colo. 1984). On rehearing, the appellate court modified its opinion, expressly evaluating the recent judgment of the supreme court in General Steel Domestic Sales, LLC v. Bacheller, 2012 CO 68, 291 P.3d 1, which had found the heightened abuse of process standards of POME inapplicable to the filing of an arbitration complaint implicating a purely private dispute. Based on its own exegesis of POME and its progeny, as well as POME's roots in federal jurisprudence, the court of appeals concluded that nothing in General Steel required the modification of its remand order.

The supreme court reverses the judgment of the court of appeals, holding that the underlying rationale for its judgment in General Steel concerning arbitration proceedings is equally applicable to actions filed in courts of law. Because it is uncontested by the parties that the action filed by Health Grades involved a purely private dispute, the supreme court remands the matter with directions to affirm the jury's verdict.

Attorneys for Petitioners: The Law Office of Paul Maxon, P.C., Paul Maxon, Boulder, Colorado.

Attorneys for Respondent: Lewis Roca Rothgerber LLP, Kris J. Kostolansky, Susan S. Sperber, Denver, Colorado.

OPINION

COATS, JUSTICE

[¶1] Boyer and Singson, defendants in a suit brought by Health Grades, petitioned for review of the court of appeals' judgment declining to affirm a favorable jury verdict on their counterclaim for abuse of process. The court of appeals remanded to the district court and ordered reversal of the verdict unless that court were to find that the claims initially brought by the plaintiff, Health Grades, were devoid of reasonable factual support or had no cognizable basis in law, in accordance with the appellate court's understanding of the mandate of Protect Our Mountain Environment v. District Court (POME), 677 P.2d 1361 (Colo. 1984). On rehearing, the appellate court modified its opinion, expressly evaluating the recent judgment of this court in General Steel Domestic Sales, LLC v. Bacheller, 2012 CO 68, 291 P.3d 1, which had found the heightened abuse of process standards of POME inapplicable to the filing of an arbitration complaint implicating a purely private dispute. Based on its own exegesis of POME and its progeny, as well as POME's roots in federal jurisprudence, the court of appeals concluded that nothing in General Steel required the modification of its remand order.

[¶2] Because we now hold that the underlying rationale for our judgment in General Steel concerning arbitration proceedings is equally applicable to actions filed in courts of law, and because it is uncontested by the parties that the action filed by Health Grades involved a purely private dispute, the judgment of the court of appeals is reversed, and the matter is remanded with directions to affirm the jury's verdict.

I.

[¶3] Health Grades, Inc., which operates a website providing information to healthcare consumers about hospitals and physicians around the country, filed suit against two of its former employees, Christopher Boyer and Patrick Singson. Its complaint alleged that Boyer and Singson created competing websites during their employment at Health Grades and solicited Health Grades' clients to advertise on their competing websites, which utilized proprietary methodologies created by Health Grades to increase the probability that consumers would discover their websites. The complaint included claims of breach of the fiduciary duty of loyalty, misappropriation of trade secrets, tortious interference with prospective business advantage, and ultimately, breach of contract and conversion.

[¶4] The defendants, Boyer and Singson, denied Health Grades' material allegations and asserted a counterclaim for abuse of process. In support of their counterclaim, they alleged that Health Grades' claims lacked a reasonable factual basis or cognizable basis in law and were based on allegations Health Grades largely knew to be false. They further alleged that Health Grades filed suit with the motive to harass and intimidate them and the purpose of limiting their ability to earn a living in their respective professional fields; and ultimately, they alleged that Health Grades' claims were a " sham."

[¶5] The district court denied cross-motions for summary judgment and for directed verdicts and submitted the case to the jury. With regard to Health Grades' motion for directed verdict on the defendants' abuse of process counterclaim, the court simply indicated that there was sufficient evidence for the jury to find for the defendants, and it instructed the jury concerning the requirements for a finding of an abuse of process under the heightened standard announced in Protect Our Mountain Environment v. District Court (POME),677 P.2d 1361 (Colo. 1984). The jury rejected all of Health Grades' claims and returned a ...


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