Eddie Trail and Katrinka Trail v. Boys and Girls Clubs of Northwest Indiana

ATTORNEY FOR APPELLANTS ATTORNEYS FOR APPELLEE
Nathaniel Ruff Paul J. Peralta
Merrillville, Indiana D. Lucetta Pope
South Bend, Indiana

In the
Indiana Supreme Court
_________________________________

No. 45S03-0504-CV-00132

EDDIE TRAIL AND KATRINKA TRAIL,
Appellants (Plaintiffs below),

v.

BOYS AND GIRLS CLUBS OF NORTHWEST INDIANA,
DONALD WEISS, BONNIE COLEMAN, JOHN DIEDERICH,
PAUL BAILEY, EDWARD WILLIAMS, FRAN TAYLOR, JAMES
GREINER, RAYMOND MORRIS, AND BONNIE FINE,
Appellees (Defendants below).
_________________________________

Appeal from the Lake Superior Court, No. 45D10-0302-CT-00035
The Honorable John R. Pera, Judge
_________________________________

On Petition to Transfer from the Indiana Court of Appeals, No. 45A03-0309-CV-00389
_________________________________

April 12, 2006

Shepard, Chief Justice.

Subsequent to a parting of ways with the Boys and Girls Clubs of Northwest Indiana,
former executive director Eddie Trail sued the organization and a number of its board members.
He alleged breach of contract, defamation, and tortious interference with an employment at will
relationship. Because Trail failed to plead sufficient operative facts, and because certain of his
claims have no basis in law, we conclude that the trial court was correct to dismiss.

1
 Facts and Procedural History

This case arises from a motion to dismiss, so the only facts available are those alleged in
the complaint. The Boys and Girls Club of Northwest Indiana is an Indiana not-for-profit
corporation. Eddie Trail worked with the Club in various capacities for twenty-three years, with
the last six as Executive Director. Trail alleges that during his service with the Club, he became
a respected and valued member of the organization, earning performance raises and receiving
recognition for his work as an Executive Director.

Trail’s employment contract with the Club expired on December 31, 2001, and early
signs seemed favorable for an extension. Board member John Diederich told Trail in February
2001 that the Executive Committee had voted unanimously to retain him as Executive Director.
After the contract expired, board president Donald Weiss informed him that members of the
Executive Committee had voted to increase his salary.

Trail alleges that Weiss, Paul Bailey, Bonnie Coleman, and Fran Taylor, who were
members of the Executive Committee, were “unhappy for personal reasons with the retention of
Trail . . . [and] were upset with [him] because he refused to defer to them on those initiatives
and actions that properly were [his] duties as Executive Director.” (Compl. ¶¶ 4, 12.) He says
these director-defendants “contrived a study of the Club” the purpose of which, Trail alleges,
was “to discredit Trail and justify his termination.” (Compl. ¶ 13.) To achieve that end, Trail
alleged that the defendants created a biased report that cast him in a negative light. (Compl. ¶¶
14, 16.) Trail says he is uncertain exactly how, or even if, the defendants used the report to
remove him from his position, but he alleges that defendant Paul Bailey told Trail the Board of
Directors had voted unanimously to terminate him, and then told both the Board of Directors,
and the media, that Trail had resigned. (Compl. ¶¶ 18, 20, 21.) 1

Trail says that although the defendants have “released to a few individuals the alleged
contents of parts of the report highly negative about Trail,” they have neither released the report

1
The defendants indicate that the Executive Committee voted unanimously on June 6, 2002 to ask Trail to resign.
(Decl. Paul Bailey ¶ 7, Appellants’ App. at 22.)

2
in its entirety to anyone, nor discussed the contents of the report openly. (Compl. ¶¶ 22-23.)
Trail claims that this silence has had a negative impact on his employment since the defendants
know that this silence “would be taken erroneously to mean that Trail had been found to have
committed grave personal improprieties with the children [the Boys and Girls Club] serve[s] or
financial misdeeds such as embezzlement.” (Compl. ¶ 23.) As proof of this negative impact,
Trail alleges that he has applied for several openings, but that in response he has been treated as
a “pariah” and received negative responses from prospective employers, which he states “would
have been inconceivable” before his termination. (Compl. ¶¶ 24, 25.)

Based on these allegations, Trail sought relief under several theories, including: breach
of implied terms of contract, tortious interference with Trail’s contract with the Club, and a claim
for defamation based on the contents of the report. Trail’s wife Katrinka Trail sought relief for
loss of consortium.

The defendants responded by moving to dismiss under Rule 12(B)(6), failure to state a
claim. After the parties filed several affidavits, exhibits, and briefs, the trial court dismissed the
Trails’ claims.

The Court of Appeals concluded that the trial court had properly dismissed Trail’s breach
of contract claim, but had wrongly dismissed the claims of tortious interference against the
Executive Committee members in their unofficial capacity, defamation, and loss of consortium.
Trail v. Boys & Girls Clubs of Nw. Indiana, 811 N.E2d 830, 842 (Ind. Ct. App. 2004) vacated.
We grant transfer and affirm the trial court.

Standard of Review

A motion to dismiss under Rule 12(B)(6) tests the legal sufficiency of a complaint: that
is, whether the allegations in the complaint establish any set of circumstances under which a
plaintiff would be entitled to relief. See Kitco, Inc. v. Corp. for Gen. Trade, 706 N.E.2d 581
(Ind. Ct. App. 1999). Thus, while we do not test the sufficiency of the facts alleged with regards

3
to their adequacy to provide recovery, we do test their sufficiency with regards to whether or not
they have stated some factual scenario in which a legally actionable injury has occurred.

A court should “accept[] as true the facts alleged in the complaint,” Minks v. Pina, 709
N.E.2d 379, 381 (Ind. Ct. App. 1999), and should not only “consider the pleadings in the light
most favorable to the plaintiff,” but also “draw every reasonable inference in favor of [the non-
moving] party.” Newman v. Deiter, 702 N.E.2d 1093, 1097 (Ind. Ct. App. 1998). However, a
court need not accept as true “allegations that are contradicted by other allegations or exhibits
attached to or incorporated in the pleading.” Morgan Asset Holding Corp. v CoBank, ACB, 736
N.E.2d 1268, 1271 (Ind. Ct. App. 2000)(citations omitted).

Indiana Trial Rule 8(A), this state’s notice pleading provision, requires only “a short and
plain statement of the claim showing that the pleader is entitled to relief.” Although the plaintiff
need not set out in precise detail the facts upon which the claim is based, she must still plead the
operative facts necessary to set forth an actionable claim. Miller v. Mem. Hosp. of South Bend,
Inc., 679 N.E.2d 1329 (Ind. 1997). Under notice pleading, we review the granting of a motion to
dismiss for failure to state a claim under a stringent standard, and affirm the trial court’s grant of
the motion only when it is “apparent that the facts alleged in the challenged pleading are
incapable of supporting relief under any set of circumstances.” McQueen v. Fayette County Sch.
Corp., 711 N.E.2d 62, 65 (Ind. Ct. App. 1999).

I. Claims for Breach of Contract

Trail contends that the trial court erred in dismissing his claim for breach of the contract
that expired by its own terms on December 31, 2001. The Court of Appeals rejected his
argument, concluding that Trail’s complaint did not provide any facts or legal authority “capable
of supporting a breach of contract action against the Club.” Trail, 811 N.E.2d at 839, vacated. It
observed that after the expiration of Trail’s contract, he became “an at-will employee subject to
termination at any time with or without cause.” Id. at 837. The Court of Appeals concluded that
Trail had not alleged any facts that would demonstrate any oral arrangement promising job

4
security. Id. at 837-39. We summarily affirm the Court of Appeals’ holding on this point. Ind.
App. Rule 58(A). Consequently, like the Court of Appeals, we will assess Trail’s other claims in
light of his position as an employee at will.

Employment at will is an American doctrine, one that freed both employer and employee
from the strictures of the English common law. English law presumed that employment
contracts of unspecified duration were to last for a year. This presumption imposed reciprocal
legal duties: the duty to provide employment for a year, and the duty to perform service for a
year. It thus ensured, as William Story explained, that “both master and servant may have the
benefit of all the seasons.” 2 With few exceptions, the modern American doctrine permits both
employers and employees to terminate an employment relationship for any reason and on a
timetable of their choosing, without being responsible financially to the other. See, e.g, Jarboe v.
Landmark Cmty. Newspapers of Indiana, Inc., 644 N.E.2d 118, 121 (Ind. 1994); Bochnowski v.
People Fed. Sav. & Loan Ass’n, 571 N.E.2d 282, 284 (Ind. 1991). But see, McClanahan v.
Remington Freight Lines, Inc., 517 N.E.2d 390, 392-94 (Ind. 1988)(employee at will may
recover for wrongful discharge if fired for refusing to perform illegal act).

II. Defamation Claim

The trial court dismissed the defamation claim after concluding that the complaint
“provides no evidence of a communication with defamatory imputation, malice, or special
damages resulting from the defamation.” (Order, Appellants’ App. at 15.)

2
2 WILLIAM W. STORY, TREATISE ON THE LAW OF CONTRACTS, 506 §962c (4th ed. 1856). William Blackstone
explained the English rule by stating that the reason for the presumptive one year term was:

natural equity that the servant shall serve, and the master maintain him, throughout all the
revolutions of the respective seasons . . . and no master can put away his servant, or servant leave
his master, after being so retained, either before or at the end of his term, without a quarter’s
warning, unless upon reasonable cause to be allowed by a justice of the peace; but they may part
by consent, or make a special bargain.

1 WILLIAM BLACKSTONE, COMMENTARIES 424-5 (1852). For a brief history of the development of the modern
doctrine of at-will employment, see McClanahan v. Remington Freight Lines, Inc., 517 N.E.2d 390, 393-94 (Ind.
1988).

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 To establish a claim of defamation, a plaintiff must prove the existence of “a
communication with defamatory imputation, malice, publication, and damages.” Davidson v.
Perron, 716 N.E.2d 29, 37 (Ind. Ct. App. 1999). Any statement actionable for defamation must
not only be defamatory in nature, but false. Doe v. Methodist Hospital, 690 N.E.2d 681, 687
(Ind. 1997) (citing Restatement (Second) of Torts § 558 (1977)).

The first communication Trail appears to treat as defamatory is the apparent transmission
of the report by the individual defendants to other directors or officers of the Boys and Girls
Club of Northwest Indiana. (Br. Appellants at 19).

The appellees argue that Trail failed to establish any of the elements of a claim for
defamation. Not so. Trail has sufficiently pled the publication requirement. This Court has held
that “employee evaluation information communicated intracompany to management personnel
may be considered published for purposes of a defamation action.” Bals v. Verduzco, 600
N.E.2d 1353, 1356 (Ind. 1992). Transmission of the report between and among the directors of
the Boys and Girls Club of Northwest Indiana would constitute publication adequate to support
the publication requirement of a defamation claim.

On the other hand, we also said in Bals that “the important role of free and open
intracompany communications and legitimate human resource management needs” require
protecting the communication of such employment information by a qualified privilege. Id. at
1356. That privilege is a defense against a defamation action and protects “communications
made in good faith on any subject matter in which the party making the communication has an
interest or in reference to which he has a duty . . . if made to a person having a corresponding
interest or duty.” Id. (citations omitted). The privilege may be overcome when the plaintiff
demonstrates an abuse of the privilege. A claimant can do this by proving an absence of good
faith, or excessive publication, or that the statement was made without belief or grounds for
belief in its truth. Id.

As to issues such as good faith, Trail has essentially alleged that members of the
Executive Committee found him unwilling or unable to conduct business according to their

6
desires. Judge Pera was correct to regard this as an inadequate allegation of bad faith. As for
whether Trail has alleged that no basis exists to believe the statements made about him, there is
some ground for sympathy with his argument that he can allege nothing else without access to
the report itself. (Br. Appellants at 17.) 3 But even under notice pleading, a plaintiff must still set
out the operative facts of the claim. Indeed, hornbook law stresses the necessity of including the
alleged defamatory statement in the complaint. See, e.g., 53 C.J.S §§ 128-163; 9 Indiana
Practice §§28.3-28.14. There is sound reason for this policy, as the absence of a statement in the
complaint works a detriment on both the court and the defendant. The court is handicapped
without the statement since, without it, the court cannot actually determine if the statement is
legally defamatory. Journal-Gazette Co., v. Bandido’s Inc., 712 N.E.2d 446, 457 (Ind. 1999).
The defendant is placed on an unfair footing since the absence of the statement denies her the
opportunity to prepare appropriate defenses.

The second “communication” Trail treats as defamatory is that between the individual
defendants and other clubs to whom he has made application. The only communication he
alleges is that “defendants have refused to say anything about the report.” (Compl. ¶ 23.)

As we observed recently, the “free flow of information about performance helps
prospective employees, prospective employers, and the economy in general.” Passmore v.
Multi-Management Serv., 810 N.E.2d 1022, 1027 (Ind. 2004) (former employer sued for failing
to tell future employer about rumors concerning employee). Liability arising out of employment
references “poses rather more complex competing policies.” Id. (citing Susan Oliver, Opening
the Channels of Communication Among Employers, Can Employers Discard Their “No
Comment” and Neutral Job References Policies?, 33 Val. U. L. Rev. 687 (1999)).

Attempting a balanced approach to these competing interests, Indiana recognizes a
qualified privilege for communications between former and prospective employers. Chambers v.
Am. Trans Air Inc., 577 N.E.2d 612, 615-16 (Ind. Ct. App. 1991). Like the privilege afforded
intracompany communications, that privilege protects human resource needs by permitting

3
Trail has alleged only that the report was “highly negative about Trail,” (Compl. ¶ 22,) but says he does not know
if the report was used to persuade the Executive Committee to terminate him. (Compl. ¶ 21.)

7
former employers “to give sincere yet critical responses to requests for an appraisal of a
prospective employee’s qualifications” without fear of a defamation action. Id. at 615. That
privilege may be overcome by showing some abuse of the privilege, such as actual or express
malice. Id. at 616.

Trail argues that he need not plead with the usual particularity because the alleged
communications were defamatory per se. Communications are considered defamatory per se
when they impute “1) criminal conduct; 2) a loathsome disease; 3) misconduct in a person’s
trade, profession, office, or occupation; or 4) or sexual misconduct” to the plaintiff. Branham v.
Celadon Trucking Services, Inc., 744 N.E.2d 514, 522 (Ind. Ct. App. 2001).

The basis of Trail’s argument that the communications are defamatory per se is his
allegation that the defendant’s unwillingness to discuss the contents of the report “would be
taken erroneously to mean that Trail had been found to have committed grave personal
improprieties with the children they serve or financial misdeeds such as embezzlement.” (Compl.
¶ 23.) Interestingly, this allegation does not actually assert, nor relate to, any actionable
defamatory statement. Rather, the allegation merely refers to the speculative effect the
defendants’ non-actionable silence has had on Trail’s reputation. It would be an odd use of the
defamation doctrine to hold that silence constitutes actionable speech.

Permitting defamation actions to proceed without the inclusion of the alleged statement
would sanction claims brought by individuals who allege nothing more than that someone must
have said something defamatory about them, or else they would not have been terminated or
unable to secure new employment. While many of these individuals might have an actual
grievance, merely making such an accusation does not establish a claim sufficiently to permit
courts to determine its legal legitimacy. When all is said and done, Trail’s complaint is little
more than an allegation of this nature. Consequently, we affirm the trial court’s dismissal of this
claim.

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 III. Tortious Interference with Employment

The trial court dismissed Trail’s claim against the individual board members for tortious
interference with his employment contract for two reasons: 1) because “the contract expired
before the alleged interference” and 2) because “a director of a corporation will not be held
personally liable for inducing the corporation’s breach of its contract if the director’s actions
were within the scope of his official duties.” (Order, Appellants’ App. at 13.)

Trail says the trial court erred in dismissing this claim since even as an employee at will
of the Boys and Girls Club, he is still entitled to assert such a claim. Moreover, Trail argues that
his complaint did allege facts sufficient to demonstrate that the four individuals named as
defendants acted outside the scope of their official capacities in firing him.

We agree with Trail that the court was incorrect to dismiss on grounds that the contract
between Trail and the Club had expired at the time of his termination. As we have explained, an
at-will employee “must be able to expect that his continued employment depends on the will of
his employer and not upon the whim of a third party interferer.” Bochnowski v. Peoples Fed.
Sav. & Loan Ass’n, 571 N.E.2d 282, 285 (Ind. 1991). Such an employee may bring a claim for
tortious interference provided that, in addition to demonstrating the standard elements of the tort,
she is “prepared to show that the defendant interferer acted intentionally and without a legitimate
business purpose.” Id.

Trail appropriately acknowledges that the trial court was correct that officers and
directors of corporations are not personally liable for tortious interference with the corporation’s
contracts unless they acted outside the scope of their official duties in causing the breach.

That an officer or director of a corporation possesses limited immunity from most
charges of tortious interference with the corporation’s contracts stems from both their role as
agents of the corporation and the nature of the tort. A party cannot “interfere” with its own
contracts, so the tort itself can be committed only by a third party. See, e.g., Martin v. Platt, 179
Ind. App. 688, 690-91, 386 N.E.2d 1026, 1027 (1979). In the case of a corporation, the legal

9
entity acts through its directors and officers. Thus, when officers or directors act in their official
capacity as agents of the corporation, they act not as individuals but as the corporation itself. In
doing so, they are not acting as a third party, but rather as a party to the contract and cannot be
personally liable for tortious interference with the contract.

Conversely, when directors or officers act outside the scope of their official capacity,
they no longer act as agents of the corporation and therefore act as a third party. Jones v. Lake
Park Care Center, Inc., 569 N.W.2d 369, 377 (Iowa 1997). Directors and officers who act
outside the scope of their official duties therefore can be held personally liable for tortious
interference with a contract. Biberstine v. New York Blower Co., 625 N.E.2d 1308, 1318 (Ind.
Ct. App. 1993); Martin, 179 Ind. App. at 690, 386 N.E.2d at 1027; Kiyose v. Trs. of Indiana
Univ., 166 Ind. App. 34, 43-44, 333 N.E.2d 886, 891 (1975).

Because the officers and directors of corporations possess some immunity from claims of
tortious interference, to state a claim against the officers and directors of a corporation, Trail
must not only allege the basic elements of tortious interference and those special elements related
to employees at will, he must also allege some interfering act by officers or directors that rests
outside their authority as agents of the corporation.

Trail makes three arguments that his complaint is sufficient to state a claim against the
individual defendants based on actions taken outside the scope of their authority.

First, Trail argues that in investigating and evaluating Trail the directors were outside the
scope of their authority. In support of this point, Trail takes issue with the trial court’s
conclusion that the authority to investigate Trail fell within “the implied powers for the directors
of a corporation” and states that the “only way the Trial Court could have made such a finding
for [the] purposes of the T.R. 12(b)(6) motion is if the Plaintiffs had admitted it in their complain
[sic] which they did not.” (Br. Appellants at 12.) This is not true.

Although the trial court is limited to those facts that the plaintiff alleges in the complaint,
it is not restrained from applying the law to the factual situation presented in it. Basic corporate

10
agency law indicates that directors enjoy a wide range of authorized powers including both those
powers expressly granted by statute and the articles of incorporation or by-laws, and that
“incidental authority necessary, usual, and proper to effectuate the main authority expressly
conferred.” Indiana Dep’t of Pub. Welfare v. Chair Lance Serv., Inc., 523 N.E.2d 1373, 1377
(Ind. 1988). Certainly, such incidental authority includes the authority to investigate and
evaluate the executive employees of the enterprise. To say that the directors lacked the authority
to carry out the inquiry flies against standard corporation law.

Perhaps recognizing this, Trail argues that because he did not allege that either the
Executive Committee or the Board of Directors acting as a whole authorized the individual
defendants to launch the investigation, the individual defendants cannot be considered to possess
the authority. (Br. Appellants at 14.) This does not save his claim. While notice pleading does
not require great specificity, it cannot be allowed to degrade into a process where all claims
survive a motion to dismiss simply because the plaintiff later says, “I did not plead enough.”
That is especially true where, as here, basic corporation law affords the directors authority to
engage in the activity at issue. Because Trail has not alleged any fact that overcomes the
presumed and implied powers of the directors, we cannot agree with Trail’s assertion that the
defendants acted outside the scope of their official duties in evaluating his work.

Second, Trail contends that the defendants acted outside the scope of their authority
because the power to terminate Trail rested solely with the full Board of Directors. In support of
this position, Trail points to his allegation that “[u]nder the Corporation’s articles, The Board has
sole authority to terminate Trail,” (Compl. ¶ 19), and to Article V Section 1 of the articles of
incorporation which states, in relevant part that the “business, property and affairs of the
corporation shall be managed by a Board of Directors which shall have the power to . . . hire the
Executive Director.” (Appellants’ App. at 35.)

Copies of the corporation’s articles and by-laws were presented to the trial court with the
defendants’ reply brief without objection, and both parties have referred to, and adopted, them on
appeal. (Appellants’ App. at 24-33, 39-41; Br. Appellants at 2; Br. Appellees at 1,3.) These
materials contradict both his assertion that the power to terminate him rested solely in the hands

11
of the Board of Directors, and his claim that the defendants in some way terminated him without
action by the Executive Committee as a whole. (Articles of Incorporation Article VI Section 2,
Appellants’ App. at 36 — “The Executive Committee shall be vested with the powers of the
Board of Directors when the same is not in session.”; Decl. of Paul Bailey ¶ 7, Appellants’ App.
at 22 — “On June 5, 2002, the Executive Committee unanimously voted to ask Eddie Trail to
resign his position as Executive Director of the Boys & Girls Clubs.”). These materials certainly
indicate that Trail has failed to allege any action by the individual defendants that went beyond
their authority as directors. The trial court should have granted summary judgment on this claim
in accordance with Trial Rule 12(B)(when “matters outside the pleadings are presented to and
not excluded by the court, the motion shall be treated as one for summary judgment and disposed
of as provided in Rule 56.”)

Third, Trail argues that his complaint alleged that the directors acted out of ill will
towards Trail, making their actions personal rather than corporate in nature. To the extent that
there are any declarations of Indiana law concerning whether a director’s personal motive alone
is sufficient to move an otherwise ordinary corporate decision, such as the firing of an employee,
beyond the scope of the director’s authority, that authority is contrary to Trail’s position. Judge
Hamilton had recent cause to review Indiana law on this point in Leslie v. St. Vincent New
Hope, Inc., 873 F. Supp. 1250 (S.D. Ind. 1995). The court had before it a claim for tortious
interference with an at-will employment relationship in which the plaintiff argued that her
supervisor’s “motives took her [the supervisor’s] actions outside the scope of her employment.”
Id. at 1255. In concluding that Indiana law would not support recovery under such a theory, the
court noted that the actions taken by the supervisor — such as ultimately dismissing the
employee — were within the supervisor’s duties as a supervisor, and that “motives could not
affect whether her actions were within the scope of her duties.” Id. at 1257.

In reaching that conclusion, the court also examined the holding in Martin v. Platt, 179
Ind. App. 688, 386 N.E.2d 1026 (1979), in which the Court of Appeals similarly held that an
action will not lie against a supervisor for tortious interference when the supervisor fires an
employee, irrespective of the supervisor’s motivations, if the supervisor possessed the authority
to fire the employee as part of his ordinary duties. Id. at 1027. In Trail’s case, there is no

12
question that the Executive Committee possessed the authority to terminate Trail. Consequently,
the defendants’ action in asking Trail to resign fell within the scope of their authority as part of
that group, and no action can lie against the individual members of that group for exercising their
rightful authority.

Even if this were not the case, Trail has not alleged that the actions taken by the
defendants were prompted by a legally improper motivation. In his complaint, Trail alleged that
the defendant’s improper motivation was his refusal to defer to them on matters of corporate
control. (Compl. ¶ 12.) At oral argument, Trail asserted that the defendants’ improper
motivation was their desire to increase their own control over the operation of the Boys and Girls
Clubs. However, in the unreported case which Trail himself cites, the court held that “[a]n
increase in corporate control is not personal advantage” of the sort that takes a director or
officer’s actions outside the scope their authority for the purposes of a tortious interference
claim. Nagy v. Riblet Prod. Corp., 1992 WL 318604, at *4 (N.D. Ind. July 2, 1992). Nothing in
Trail’s complaint suggests that the “personal advantage” sought by the defendants was anything
other than larger influence over the direction of the enterprise.

Conclusion

To survive a 12(B)(6) motion to dismiss of a tortious interference claim, the plaintiff
must provide “at the very least a description of the tortious conduct.” Kiyose v. Trs. of Indiana
Univ., 166 Ind. App. 34, 44, 333 N.E.2d 886, 891 (1975). In this case, Trail has failed to do so.
Consequently, his claim for tortious interference was properly dismissed.

We therefore affirm the decision of the trial court.

Sullivan and Boehm, JJ., concur.
Rucker, J., dissents with separate opinion in which Dickson, J., joins.

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Rucker, Justice, dissenting.

I respectfully dissent. The law is settled that a complaint may not be dismissed under
Ind. Trial Rule 12(B)(6) for failure to state a claim upon which relief can be granted unless it
appears to a certainty on the face of the complaint that the complaining party is not entitled to
any relief. King v. S.B., 837 N.E.2d 965, 966 (Ind. 2005); City of New Haven v. Reichhart, 748
N.E.2d 374, 377 (Ind. 2001); Martin v. Shea, 463 N.E.2d 1092, 1093 (Ind. 1984). In ruling on a
motion to dismiss for failure to state a claim, the trial court is required to view the complaint in a
light most favorable to the nonmoving party and with every reasonable inference in his favor.
King, 837 N.E.2d at 966. The trial court may only look to the complaint, and well-pleaded
material must be taken as admitted.

Ind. Trial Rule 8(A) requires only a “short and plain statement of the claim showing that
the pleader is entitled to relief.” Under such notice pleading, a complainant is only required to
plead the operative facts involved in the litigation. The rules of notice pleading do not require
that the complaint recite in detail all the facts upon which the claim is based. Obremski v.
Henderson, 497 N.E.2d 909, 910 (Ind. 1986). Accordingly, a complaint is sufficient if it states
any set of allegations, no matter how unartfully pleaded, upon which the trial court could have
granted relief. Miller v. Memorial Hosp. of South Bend, 679 N.E.2d 1329, 1332 (Ind. 1997);
McQueen v. Fayette County Sch. Corp, 711 N.E.2d 62, 65 (Ind. Ct. App. 1999). More
specifically, “the plaintiff is required to provide a clean and concise statement that will put the
defendants on notice as to what has taken place and the theory that the plaintiff plans to pursue.”
McQueen, 711 N.E.2d at 65. Indeed we view “motions to dismiss for failure to state a claim
with disfavor because such motions undermine the policy of deciding causes of action on their
merits.” Id.

To establish a claim of defamation, a plaintiff must prove the following: (1) a
communication with defamatory imputation, (2) malice, (3) publication, and (4) damages.
Schrader v. Eli Lilly & Co., 639 N.E.2d 258, 261 (Ind. 1994). In this case, the
“communication” was the contents of the consultant’s report. In my view the Trails’
complaint alleged the operative facts relating to each element of a defamation claim: (1) a

14
communication with defamatory imputation: “[t]he Defendants have released to a few
individuals the alleged contents of part of the report highly negative about [Eddie];” (2) malice:
“[t]he actions of the individual Defendants were intentional and malicious;” (3) publication:
“[t]he Defendants have released to a few individuals the alleged contents of part of the report
highly negative about [Eddie];” and (4) damages: “[Eddie] has suffered . . . loss of earnings . . .
from the Defendants’ actions.” Appellants’ App. at 19-20. It bears repeating that under notice
pleading a party is only required to plead the operative facts involved in the litigation. Here,
although perhaps unartfully pleaded, the complaint is sufficient to defeat an Ind. Trial Rule
12(B)(6) motion to dismiss. And this is especially so considering that in this pre-discovery phase
of litigation, the report has not yet been made available to the Trails. The defendants should not
be allowed on the one hand to withhold the report, which apparently would reveal the specific
contents of the allegedly defamatory statements, and on the other hand complain in effect that it
has no “notice as to what has taken place and the theory that the plaintiff[s] plan . . . to pursue.”
McQueen, 711 N.E.2d at 65.

As for the Trails’ tortious interference claim, I disagree with the majority sua sponte
declaring, “the trial court should have granted summary judgment on this claim in accordance
with Trial Rule 12(B).” Slip op. at 12. Unlike a motion to dismiss for failure to state a claim
upon which relief can be granted which tests the legal sufficiency of a claim and not the facts
supporting it, the purpose of summary judgment is to terminate litigation about which there can
be no factual dispute and which may be determined as a matter of law. Bushong v. Williamson,
790 N.E.2d 467, 474 (Ind. 2003). Ind. Trial Rule 12(B) provides:

If, on a motion, asserting the defense number (6), to dismiss for
failure of the pleading to state a claim upon which relief can be
granted, matters outside the pleading are presented to and not
excluded by the court, the motion shall be treated as one for
summary judgment and disposed of as provided in Rule 56. In
such case, all parties shall be given reasonable opportunity to
present all material made pertinent to such a motion by Rule 56.

(Emphasis added).

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 The record shows that in a reply in support of their earlier filed T.R. 12(B)(6) motion to
dismiss, the defendants filed as an exhibit the affidavit of one of the members of the Executive
Committee attached to which were the articles of incorporation and the constitution and by-laws
of the Boys and Girls Club. Appellants’ App. at 5, 21-41. At the hearing on defendants’ motion
to dismiss, the Trails acknowledged that the documents were “attached to the response—to the
reply” but specifically urged “we object to this being transformed into a motion for summary
judgment by attaching this to the reply or by any other means.” Tr. at 13. It is true that the trial
court did not enter an express order excluding these “matters outside the pleading.” But it is
equally true the trial court did not consider them in ruling on the defendants’ motion to dismiss.
The record is clear that in its six page order granting the motion, the trial court made no
reference whatsoever to the defendants’ exhibit. See Appellants’ App. at 10-15. Instead, the
trial court relied exclusively on the allegations in the Trails’ complaint. Id. This is particularly
significant because, among other things, had the trial court decided to rely on these materials and
thus transform the motion to dismiss to a motion for summary judgment, then the Trails would
have been “given reasonable opportunity to present all materials made pertinent to such a motion
by Rule 56.” T.R. 12(B). Pending before the trial court at the time of the motion to dismiss was
defendants’ motion for protective order, see Appellant’s App. at 5; Tr. at 2, 24, which was
apparently filed in response to the Trails’ discovery requests. The trial court deferred ruling on
the motion for protective order until after he had ruled on the motion to dismiss. Tr. at 2, 24. It
would have been error for the trial court to have considered matters outside the pleadings offered
by the defendants, not afford the Trails an opportunity to conduct discovery thereby possibly
refuting the allegations contained in these external documents, and then grant summary judgment
in defendants’ favor. It is apparent to me that the trial court ruled solely on the basis of the
pleadings. Reviewing this claim under a summary judgment standard of review is inconsistent
with the record. It also places the Trails in an untenable position, which leads to my next point.

Relying on selected portions of the documents, namely: “[t]he Executive Committee shall
be vested with the powers of the Board of Directors when the same is not in session” and “[o]n
June 5, 2002, the Executive Committee unanimously voted to ask Eddie Trail to resign as
Executive Director of the Boys & Girls Clubs,” the majority concludes they “contradict both
[Eddie’s] assertion that the power to terminate him rested solely in the hands of the Board of

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Directors, and his claim that the defendants in some way terminated him without action by
Executive Committee as a whole.” Slip op. at 12. There are at least two problems with the
majority’s conclusion. One, by the express terms of the Clubs’ constitution, the Executive
Committee is vested with the powers of the Board of Directors “when the same is not in
session.” There was nothing before the trial court and thus nothing before this Court declaring
whether the Board was in session at the time of Eddie’s termination. The defendants make no
claim one way or the other. And absent discovery the Trails apparently are unable to say. Two,
the affidavit of one of the Executive Committee members is the source of the claim that the
Committee “unanimously” voted to terminate Eddie. This assertion however could very well be
challenged if the Trails were afforded an opportunity to present their own Rule 56 materials and
provided they were given the opportunity to conduct discovery.

It is of course true that basic corporations law affords directors in their official capacity
the authority to investigate and evaluate their employees. See Slip op. at 11. We have held for
instance that, “[a] corporate officer is not liable for inducing the corporation’s breach of its
contract if the officer acts within the scope of his official duties on behalf of the corporation and
not as an individual for his own advantage.” Winkler v. V.G. Reed & Sons, Inc., 638 N.E.2d
1228, 1234 n.7 (Ind. 1994). The Trails’ complaint alleged that certain individual board members
were not acting in an official capacity in investigating and evaluating Eddie, but rather were
acting outside the scope of their official duties and for their own advantage. According to the
complaint, certain individual board members contrived a study that was critical of Eddie to
“discredit [him] and justify his termination.” Appellants’ App. at 18. The Trails alleged that
those board members “structured the actual reporting so that only the four of them and select
individuals, chosen solely by them, would be interviewed for the study to be performed by a
consultant” and that Eddie has been denied access to the report in violation of the defendants’
standard protocol and procedures. Id. The complaint also alleged that the actions of those board
members were “intentional and malicious” and that Eddie has been damaged as a result of their
actions. Id. at 20. In sum, the Trails alleged that certain individual board members intentionally
induced a breach of Eddie’s at will employment, that they acted maliciously and without
justification, and that Eddie has suffered damages as a result. Further, the complaint alleged that
these same board members were acting outside the scope of their official duties, namely: they

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were unhappy, for personal reasons, about Eddie’s retention as Executive Director. I agree with
the Court of Appeals that these allegations are sufficient to put these individual defendants on
notice of the Trails’ tortious interference claim.

To be sure the bare allegations in the Trails’ complaint would likely not withstand a
motion for summary judgment under Ind. Trial Rule 56. But this litigation is only in the
pleading stages and discovery has not yet been conducted . Therefore, I would reverse the trial
court’s dismissal of the Trails’ defamation claim as well as the tortious interference claim against
the individual board members and remand this case for further proceedings.

Dickson, J., concurs.

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