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When a non-Pennsylvanian hires a Pennsylvania lawyer knowing that most of the work will be done from the lawyer’s Pennsylvania office, the out-of-state client can later be sued by the lawyer in a Pennsylvania court for breach of contract under Pennsylvania’s long-arm statute, the 3rd U.S. Circuit Court of Appeals ruled. But the same lawyer cannot sue the same client in Pennsylvania for defamation over statements made in a letter faxed to the lawyer’s office and seen by others there because such a publication cannot be said to have been “aimed” at a Pennsylvania audience, the unanimous three-judge panel ruled. And in a significant ruling on the nature of the language lawyers use when dealing with each other, the court found that the lawyer has no claim for defamation against a lawyer for accusing him of “attempting to extort money,” since the phrase was merely “rhetorical hyperbole” and “the audience to which this statement was allegedly published knew that it arose from bitter attorney communications.” The decision in Remick v. Manfredy partially revives entertainment and sports attorney Lloyd Z. Remick’s suit against professional boxer Angel Manfredy; his brother and agent, John Manfredy; a Chicago law firm, D’Ancona & Pflaum, and one of its lawyers, Jeffrey H. Brown. According to the suit, Remick was approached in late 1996 by Angel Manfredy, a lightweight professional boxer — along with John Manfredy and Brown — about representing Angel Manfredy in negotiations, particularly with fight promoter Cedric Kushner Productions Ltd. SPECIAL COUNSEL CONTRACT Eventually, Remick and Manfredy entered into a contract under which Remick would act as Manfredy’s special counsel in the procurement and negotiation of high-profile and lucrative fights, promotions and endorsements. Manfredy signed a fee agreement that entitled Remick to a specified percentage of all purses or other compensation which Manfredy received for boxing or promotions during the term of the agreement and of any endorsement contract procured by Remick. Remick was to receive five percent of up to $35,000 of Manfredy’s purse for the first bout and, thereafter, eight percent of the net amount of all purses or other compensation Manfredy received for boxing or promotions during the term of the agreement, as well as 15 percent of the gross amount Manfredy received from any endorsements Remick procured. In February 1997, Remick succeeded in negotiating an “exclusive promotional agreement” between Kushner and Manfredy. Remick claims that Manfredy quickly benefited from the deal and within a year Remick had secured Manfredy purses up to $375,000. In early 1998, there was a disagreement between Remick and Manfredy over negotiations for an HBO-televised fight between Manfredy and Azumah Nelson, and ultimately the proposed Nelson fight fell through. In March 1998, Manfredy sent Remick a letter terminating his representation, saying that Remick had failed to adequately represent Manfredy’s interests by not delivering on certain alleged promises and faltering as a negotiator. In the letter, Manfredy complained that Remick had failed to deliver a single endorsement opportunity. It ended with an instruction that Remick forward Manfredy’s file to D’Ancona & Pflaum. SEEKS SHARE OF PURSE Manfredy’s team later negotiated with Kushner for a June 1998 bout against Isander Lacen with a $75,000 purse. Remick claimed that he was entitled to an eight percent share of Manfredy’s purse because he negotiated the overarching promotional agreement between Manfredy and Kushner. Remick asked Kushner to place eight percent of Manfredy’s purse into escrow until his dispute with Manfredy could be resolved, but Kushner refused to do so. In September 1998, Remick wrote to Manfredy rejecting the termination of his representation and demanding eight percent of Manfredy’s purse from the Lacen fight. The letter said that if Manfredy refused, Remick would “be left with no recourse than to pursue legal remedies.” The response came from D’Ancona & Pflaum attorney Kathleen Klaus, who, in a letter to Remick, said that Manfredy had terminated his agreement with Remick six months before and that “we are not aware of any legal principle which allows you to ‘reject’ the termination of an attorney client relationship or any authority which requires one party to the contract to perform in the face of the other party’s breach.” Remick claims the next paragraph of Klaus’s letter defamed him. It read: “If you insist on attempting to extort money from Cedric Kushner Promotions Ltd. or any other entity with which Mr. Manfredy is engaged on the basis of your alleged contract with Mr. Manfredy, we will not hesitate to pursue our legal remedies, including a suit for damages arising from your failure to adequately represent Mr. Manfredy.” Remick filed suit alleging breach of contract, tortious interference with contract, misappropriation of image and likeness, civil conspiracy and defamation. But U.S. District Judge J. Curtis Joyner dismissed all of the claims against the individual defendants, finding that he had no personal jurisdiction over them. Manfredy is an Indiana resident, and the other defendants are residents of Illinois. Joyner found that the court had personal jurisdiction against D’Ancona & Pflaum but dismissed with prejudice Remick’s defamation claim against the law firm. He also dismissed, without prejudice, his claims against the firm for interference with business and contractual relationships and civil conspiracy. Now the 3rd Circuit has ruled that Joyner erred in dismissing some of the claims against the individuals since a Pennsylvania court would have personal jurisdiction based on the specific nature of the claims. U.S. Circuit Judge Dolores K. Sloviter explained that personal jurisdiction “may be exercised under two distinct theories, a defendant’s general or claim-specific contacts with the forum.” General jurisdiction, she said, is based upon the defendant’s “continuous and systematic” contacts with the forum and exists even if the plaintiff’s cause of action arises from the defendant’s non-forum related activities. In contrast, she said, specific jurisdiction is present only if the plaintiff’s cause of action arises out of a defendant’s forum-related activities, such that the defendant “should reasonably anticipate being haled into court” in that forum. Sloviter found that Joyner did not conduct a claim-specific analysis except as to the breach of contract claim. MORE ANALYSIS REQUIRED While such an analysis “may not be necessary” in every case, Sloviter said, “we believe such differentiation is required here.” Looking first to Remick’s breach-of-contract claim against Angel Manfredy, Sloviter found that it was one that Pennsylvania courts would hear. Remick claims that Manfredy sought him out by placing a telephone call to Remick’s associate at their office in Philadelphia which eventually resulted in the fee agreement which Remick signed in, and Manfredy signed and returned to, Pennsylvania. Sloviter noted that most of the services performed by Remick on behalf of Manfredy were conducted at Remick’s Philadelphia office and that “Manfredy certainly should have expected as much as he knew that Remick’s home office is in Philadelphia.” There were also repeated “informational communications” during the course of the contractual relationship between Manfredy and Remick, Sloviter noted, with Remick at his Philadelphia office. As a result, Sloviter found that the relationship “as a whole involved more entangling contacts than the mere informational communications.” But, turning to Remick’s defamation claim over the two letters, Sloviter found that personal jurisdiction was not established. Remick’s lawyer, Patrick C. Campbell of Richard G. Phillips Associates, argued that the court had specific personal jurisdiction over the individual defendants as to the defamation claim because the allegedly defamatory statements targeted a Pennsylvania resident’s forum-related activities and were published in Pennsylvania. Campbell cited the U.S. Supreme Court’s 1984 decision in Calder v. Jones which established an “effects test” for determining personal jurisdiction over nonresident defendants who allegedly committed an intentional tort outside the forum. Calder involved an allegedly libelous National Enquirer article written and edited in Florida and published nationwide concerning the California activities of a California resident. Because the California resident was an entertainer in Hollywood, the justices found that the story had its greatest impact in California and that California therefore had personal jurisdiction over the author and editor because the “effects” of their Florida conduct were chiefly felt in California. But Sloviter found that the 3rd Circuit has expanded on Calder and held that the plaintiff succeeds in the effects test only if he can show that “he defendant expressly aimed his tortious conduct at the forum such that the forum can be said to be the focal point of the tortious activity.” Remick failed to meet that prong of the test, Sloviter said, because the two persons in his office read the letter “solely because it was lying on the fax machine.” “There is no indication that the letter was targeted at them or at anyone in Pennsylvania other than Remick,” Sloviter wrote. Sloviter also rejected Remick’s claim that the defamatory statements in the letters were published to the entire boxing community, saying “such persons were apparently located throughout the country” and that “it cannot be said that the defendants here expressly aimed their conduct at Pennsylvania so that Pennsylvania was the focal point of the tortious activity.” But Sloviter sided with Remick on his claim of tortious interference with contractual relations, finding that it was similar to the breach of contract claim because “the effects of any intentional conduct by the defendants designed to interfere with Remick’s contractual relations with Manfredy necessarily would have been felt in Pennsylvania.” Because the law firm was also named as a defendant in the defamation claim, Sloviter said, the court was forced to tackle the merits of the claim to determine if the statements in either of the letters was capable of defamatory meaning. Manfredy’s letter accused Remick of “failing to adequately represent Manfredy’s interests; failing to recognize and discharge his obligations to Manfredy; failing to live up to promises he had made to Manfredy; and being an ineffective negotiator and attorney.” Sloviter found that “each of these statements expressed Manfredy’s subjective opinion.” Under Pennsylvania law, she said, an opinion cannot be defamatory unless it “may reasonably be understood to imply the existence of undisclosed defamatory facts justifying the opinion.” Since Manfredy’s letter noted five instances in which he said Remick failed to adequately represent his interests, Sloviter found that “the opinions set forth by Manfredy … cannot be considered defamatory.” Turning to the letter from attorney Klaus that accused Remick of “attempting to extort money,” Sloviter found that it, too, was incapable of defamatory meaning because it “was written in the context of two lawyers taking diametrically opposing legal positions.” “Correspondence between jousting lawyers is not always drafted with the finesse, tact, and niceties used by a 19th century novelist, and, as we have previously stated, ‘it is well settled that the use of catchy phrases or hyperbole does not necessarily render statements defamatory that would otherwise be non-actionable,’” Sloviter wrote. “While the letter from Klaus probably should have been toned down, and we encourage counsel to maintain civility in their correspondence with each other regardless of the animosity between clients, the audience to which this statement was allegedly published knew that it arose from bitter attorney communications,” she wrote.

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