Truth defeats a tortious interference with contract claim

Telling the truth is not a tort. Today, as PLF urged in its amicus brief, the Texas Supreme Court ruled in Community Health Systems v. Hansen that truth is an absolute defense to an intentional interference with contract claim. The case arose when the College Station Medical Center terminated Dr. Henry Hansen’s employment contract. In making this decision, the hospital relied on advice by a professional services administration firm that evaluated physician performance and employment. The firm truthfully advised the hospital that Dr. Hansen had caused significant financial losses due to the combination of his very high salary, failure to see a sufficient number of patients, and a months-long refusal to accept referrals from two of the three primary referring doctors.

The unanimous decision notes that the firm’s statements were true, and that the firm had a duty to provide explanations for its recommendations. The court’s decision bodes well for employment relationships based on the valuable communication of truthful information. Without protections for truthful communication about workplace performance, employment decisions are made in ignorance. Good employees suffer when employers or administrators fear to convey positive information about exemplary work performance while incompetent employees are shielded from any disclosures that might result in otherwise natural consequences of underperformance. Ultimately, society as a whole suffers when employers make inefficient decisions because those who have information are stifled for fear of lawsuits. PLF applauds today’s decision that recognizes and applies these important policies.