Va. court to hear appeal in grocery lawsuit

By Larry O’Dell, Associated Press – June 4, 2008

RICHMOND, Va. (AP) A jury improperly awarded $16 million to an inner-city grocer who claimed grocery giant Supervalu Inc. sabotaged his efforts to expand and forced him out of business, a lawyer for the large chain told the Virginia Supreme Court on Wednesday.

Edward J. Fuhr urged the court to reverse the verdict for Johnny Johnson of Richmond, who closed his four Community Pride supermarkets a month before filing the lawsuit against Supervalu in 2004.

Johnson claimed Supervalu, one of the nation’s largest food store operators and suppliers, undermined his efforts to buy a Virginia Beach-based 18-store chain that had just emerged from bankruptcy protection. A jury agreed after an 11-day trial last year and awarded Johnson damages for “constructive fraud” and intentional infliction of emotional distress.

“He was wrecked emotionally because of this,” said Johnson’s attorney, Steve Emmert.
Fuhr argued that the trial judge should have set aside the verdict because she had instructed jurors that Johnson had to prove an unintentional “misrepresentation of a past or present fact” to support a finding of constructive fraud — conduct that lacks the intent to deceive but has the same result as actual fraud.

“They ignored the explicit instruction on constructive fraud,” Fuhr said of the jurors.

But Emmert said jurors were entitled to consider the jury instructions in their entirety, including those on actual and constructive fraud, and award damages they believe were supported by the evidence.

Fuhr also said the court has never allowed an infliction of emotional distress claim in a corporate battle, but Emmert said Supervalu’s actions targeted Johnson, not his stores.

Supervalu “intentionally and systematically invoked personal ruin upon this man,” Emmert said.

At his trial, Johnson claimed that Minnesota-based Supervalu singled him out as a troublemaker. His lawyers argued that while Supervalu had extended to him high-interest loans and supply contracts worth millions, the company backed off support for Johnson when he tried to expand.

Supervalu argued that Johnson’s stores were failing and that additional loans would have been too risky.

The Supreme Court is likely to rule in September.