Blank v. Kirwan

In Blank v. Kirwan (1985) 39 Cal.3d 311, an applicant for a poker club license sought to state a cause of action for intentional interference with prospective economic advantage by alleging defendants had conspired to monopolize the operation of such clubs, and but for their acts, he would have made profit operating a poker club in the city of Bell. (Blank v. Kirwan, at pp. 318, 329.) The plaintiff and one of the defendants both applied for a poker club license in the City of Bell. The city council approved defendant's application, and denied plaintiff's application. Plaintiff sued, alleging a conspiracy among various private individuals and city officials to legalize and monopolize the operation of poker clubs. The plaintiff alleged that "but for defendants' acts he would have made some undetermined profit operating a poker club in the City of Bell ... ," and argued these allegations stated a cause of action for intentional interference with prospective economic advantage. (Id. at pp. 329-330.) The Supreme Court affirmed the order sustaining the defendants' demurrer to this cause of action, observing the plaintiff's allegations revealed the prospective business relationship was " 'to a class of as yet unknown patrons . . . .' " ( Id. at p. 330.) It held the plaintiff could not allege a protectable expectancy of a relation with the class of potential poker club patrons "but at most a hope for an economic relationship and a desire for future benefit." (Blank v. Kirwan, at p. 331.) The Supreme Court held the plaintiff's complaint did not state a cause of action "because the first element of the tort is lacking." (Blank v. Kirwan, supra, 39 Cal.3d at p. 330.) "First, 'the relationship between plaintiff and the City cannot be characterized as an economic relationship. It was plaintiff's relationship to a class of as yet unknown patrons which was the prospective business relationship.' ." (Ibid.) Even if the relationship between the plaintiff and the city could be characterized as an economic relationship, the court said, "it would make little difference. The tort has traditionally protected the expectancies involved in ordinary commercial dealings--not the 'expectancies,' whatever they may be, involved in the governmental licensing process." (Ibid.) Further, the city council's discretion to grant or deny a poker club license application was "so broad as to negate the existence of the requisite 'expectancy' as a matter of law. Thus, 'no facts are alleged ... showing that the plaintiff had any reasonable expectation of economic advantage which would otherwise have accrued to him ... .' ." (Ibid.) Construing a former statute the "substance of which is continued in Code of Civil Procedure section 583.420, subdivision (a)" (Blank, supra, 39 Cal.3d at p. 331, fn. 7), the court held: "When the trial court has ruled on such a motion, '"unless a clear case of abuse is shown and unless there has been a miscarriage of justice a reviewing court will not substitute its opinion and thereby divest the trial court of its discretionary power."' '"The burden is on the party complaining to establish an abuse of discretion . . . ." (Blank, supra, 39 Cal.3d at p. 331.)