GENERAL INTEREST As the Supreme Court of Virginia recently commented: “The gist of the civil action of conspiracy is the damage caused by the acts committed in pursuance of the formed conspir-acy and not the mere combination of two or more persons to accomplish an unlawful purpose or use an unlawful means.” 11 A plaintiff cannot maintain a claim for common law conspiracy when the unlawful act underlying the claim does not allow for an award of damages. 12 Ordinarily, the issue of whether a conspiracy caused the alleged damage is one for the jury’s decision. 13 Stating a Claim for Statutory Business Conspiracy Under Virginia Law Under Virginia law, a plaintiff must prove three elements to state a prima facie cause of action under Virginia’s business conspiracy statute: 1. A combination of two or more persons; 2. For the purpose of willfully or maliciously inuring a plain-tiff in reputation, trade, business, or profession; and 3. Resulting in damage to the plaintiff. 14 To prove attempted business conspiracy, a plaintiff must prove that a person attempted to procure the participation or cooperation of another to enter into a business conspiracy 15 and resulting damage to the plaintiff. 16 Proof of a civil conspir-acy must be shown by clear and convincing evidence. 17 Proving Civil Conspiracy Claims I. A Combination of Two or More Persons to Accomplish, by Some Concerted Action — Necessary Elements for Common Law and Statutory Business Conspiracy Claims Both the common law and statute require a combination of two separate actors in a concerted action. 18 “Concerted action” reflects the statutory requirement that a plaintiff ultimately prove that someone “combined, associated, agreed, mutually undertook, or concerted together” with someone else in the conduct at issue. 19 A plaintiff must prove then, to be successful in his or her claim, that the defendants “combined together to effect a preconceived plan and unity of design and purpose.” 20 After all, this “common design is the essence of the conspira-cy.” 21 A common law conspiracy claim only requires proof of a “tacit understanding”— an express agreement is not a neces-sary component of the claim. 22 The “two or more persons” requirement, however, is not satisfied by proof that a principal conspired with one of its agents that acted within the scope of his agency. 23 Under such a circumstance, a conspiracy is a legal impossibility because a principal and an agent are not separate persons for purposes of the conspiracy statute. This rule is commonly referred to as the “intracorporate immunity” doctrine. 24 That doctrine holds that where the agents or employees of a corporation are acting within the scope of their employment, “then only one entity exists”— the corporation — and “[b]y definition, a single entity cannot conspire with itself.” 25 To the contrary, an agent www.vsb.org or employee acting outside the scope of his employment or agency can be liable for a civil conspiracy to injure a person’s business. 26 The question of what is within the scope of employment is not always clear, but “[b]oth the Fourth Circuit and the state courts of Virginia take a ‘fairly broad view of the scope of employment.’” 27 “Generally, an act is within the scope of em-ployment if it is ‘naturally incident to [the master’s] business . . . done while the servant was engaged upon the master’s busi-ness, and did not arise wholly from some external, indepen-dent, and personal motive on the part of the servant to do the act upon his own account.’” 28 An act may be prohibited by the employer, tortious, or even criminal to be done yet fall within the scope of employment. The test “is not whether the tortious act itself is a transaction within the ordinary course of busi-ness of the [employer], or within the scope of the [employee’s] authority, but whether the service itself, in which the tortious act was done, was within the ordinary course of such business or within the scope of such authority.” 29 Further, employees are not the only agents who fall under the doctrine as both Virginia federal and state courts have applied the intracorporate immunity doctrine to corporate directors. 30 Federal courts do apply an exception to this rule where an officer or director has a stake or a purpose “independent of his interest in the corporation’s success.” 31 For instance, in Greenville Publishing Company v. Daily Reflector , Inc., 32 the Fourth Circuit observed that an exception to the intracorporate immunity doctrine “may be justified when the officer has an independent personal stake in achieving the cor-poration’s illegal objective.” 33 A Virginia state court has found that this federal personal stake exception is different from the scope of employment test and explained that the personal stake exception “applies primarily in antitrust actions, such as where a corporate director with a personal stake in another business conspires to use the corporation to eliminate com-petitors for that personal business interest, thus, hijacking the corporation for his own personal, illegal, ends.” 34 In fact, courts have held that the exception was meant to apply only to cir-cumstances in which the “conspirator gained a direct personal benefit from the conspiracy, a benefit wholly separable from the more general and indirect corporate benefit always present under the circumstances surrounding virtually any alleged corporate conspiracy.” 35 The Supreme Court of Virginia has not adopted the personal stake exception. 36 In sum, Virginia courts consistently have held that a con-spiracy cannot form in the following situations: • A single entity cannot conspire with itself. 37 • A corporation cannot conspire with its wholly-owned subsidiary. 38 • Partners cannot conspire when they are acting within the scope of their partnership. 39 • If the conspiracy involves the breach of a contract, one of the conspirators must be a third party to that contract. 40 GENERAL INTEREST FEATURES | VOL. 69 | AUGUST 2020 | VIRGINIA LAWYER 23