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Cains v. Grassi

United States District Court, D. Arizona

July 6, 2018

David Cains, et al., Plaintiffs,
Elisa Grassi, et al., Defendants.


          Honorable Roslyn O. Silver Senior United States District Judge

         Defendants Elisa Grassi and Frank Sponle made statements to non-parties that Plaintiffs David Cains and Scott Bailey stole two horse embryos. Based on those statements, Cains, Bailey, and two related entities filed this suit against Grassi and Sponle, alleging claims for defamation, false light, and intentional infliction of emotional distress. Grassi and Sponle believe all three claims are barred by the applicable statutes of limitations. Viewed in the light most favorable to the plaintiffs, the evidence establishes Grassi and Sponle are right.


         Plaintiffs are two individuals, David Cains and Scott Bailey, and two entities, Stonewall Farms Arabians, LLC, and Knight Media Networks, Inc. The parties have not provided a complete explanation of the relationship between Cains, Bailey, and the entities. It appears, however, that Cains and Bailey work in the Arabian horse industry and the entities provide services to that industry. Stonewall Farms is “owned and controlled by . . . Bailey.” As part of its business, Stonewall Farms owns numerous horses. Bailey also owns and controls Knight Media, a business devoted to operating horse-related websites. Bailey is not involved in all the transactions regarding horses owned by Stonewall Farms. Instead, Cains sometimes acts as Stonewall Farms' agent when Stonewall Farms sells its horses. For the most part, the presence of Stonewall Farms and Knight Media as plaintiffs can be ignored.[2]

         Prior to February 2012, Stonewall Farms owned a horse named La Bella Versace (“Bella”). In February 2012, Cains began negotiating with Defendant Elisa Grassi regarding the sale of Bella. At that time, Grassi was acting as the agent for non-party Sheikh Ammar bin Humaid Al Nuaimi, the Crown Prince of the Emirate of Ajman (“Sh. Ammar”). During those negotiations, Cains told Grassi that any sale agreement would have to provide that Stonewall could retrieve two embryos from Bella. Grassi agreed to those terms and, on February 25, 2012, Bella was sold to Sh. Ammar. The written agreement executed by Cains and Grassi did not include any provisions regarding subsequent embryo retrieval.

         After Bella was sold, she remained at Stonewall Farms' facility. While there, Cains retrieved two embryos from her. Bella was then shipped out of Arizona. In 2013, Grassi and her partner Defendant Frank Sponle had a disagreement with Cains and Bailey regarding the purchase of another horse. That disagreement led to Grassi and Sponle setting out to “financially ruin” Cains and Bailey (“Plaintiffs”). (Doc. 24 at 6). To do so, Grassi and Sponle began “making false statements about the Plaintiffs to others in the Arabian Horse Industry.” (Doc. 24 at 6). Those false statements were that Plaintiffs had “stole[n] horse embryos from Sheikh Ammar.” (Doc. 24 at 7). Unfortunately, Plaintiffs have not clearly identified each false statement Grassi and Sponle made. That is, Plaintiffs have not clearly identified who said what to whom.[3] Based on the evidence presented at summary judgment, however, the following statements are at issue.[4]

         First, in approximately August 2013, Sponle told Sh. Ammar that “Cains had stolen an embryo from [Bella].” (Doc. 79-1 at 11; Doc. 74 at 80). Next, on some unidentified date prior to February 2014, Grassi told Sh. Ammar that Cains and Bailey had stolen embryos from Bella. And finally, also on some unidentified date prior to February 2014, Grassi and Sponle made statements to two other non-parties that Cains stole an embryo from Bella. (Doc. 79-1 at 11; Doc. 74 at 80).

         After hearing about the alleged embryo thefts, counsel for Sh. Ammar sent Plaintiffs a letter titled “Pre-Litigation Notice and Legal Demand.” (Doc. 74 at 34). That letter, dated February 4, 2014, recited the basic facts regarding the sale of Bella to Sh. Ammar and Cains' subsequent extraction of two embryos. According to the letter, the sale agreement did not include any terms allowing for the retrieval of two embryos after the sale. And by retrieving the two embryos, Plaintiffs had “committed the tort of conversion by appropriating the property of Sh. Ammar to [their] own beneficial use . . . namely, the use of [Bella] to produce embryos.” (Doc. 74 at 37). Based on Plaintiffs' actions, Sh. Ammar demanded immediate payment of $215, 000. If Plaintiffs did not pay that amount within ten days, Sh. Ammar stated he would file suit against them. (Doc. 74 at 38). Bailey and Cains sent separate responses to this letter. Both of those responses assumed it was Grassi, not Sponle, who had told Sh. Ammar about the embryo theft.

         On February 15, 2014, Bailey emailed his response to Sh. Ammar's letter. In that email, Bailey stated he had been “shocked and amazed” by the letter. (Doc. 74 at 55). In Bailey's view, Grassi was “a very vindictive, bitter and nasty person” who was doing “everything possible to destroy” Bailey's relationship with Sh. Ammar. Bailey stated Grassi was just using Sh. Ammar to “get back at [Plaintiffs]” and she was “telling you lies about the sale of that mare.” On February 22, 2014, Cains emailed his response to Sh. Ammar's letter. (Doc. 74 at 57). Cains' email attacked the substance of the allegation that retrieving embryos from Bella had not been part of the sale agreement. According to Cains, he had told Grassi that Bella's previous owner was entitled to one embryo and that Cains hoped to retrieve an embryo for himself. (Doc. 74 at 57). Cains claimed there had never been any intent to keep the embryo retrievals secret. And Cains described Grassi as “twisting the truth with regards to this sale” out of some desire to harm Plaintiffs. (Doc. 74 at 57).

         Based on the letter from Sh. Ammar's counsel, and the responsive emails from Bailey and Cains, there is no genuine dispute of material fact that as of February 2014, Bailey and Cains knew Grassi had made a statement to Sh. Ammar about the allegedly unauthorized embryo retrievals. The letters and emails do not, however, explicitly identify Sponle as making a similar statement to Sh. Ammar.

         The exact content of Grassi's and Sponle's statements to two other non-parties is not as clear. But it is clear when those statements were made. On some unidentified date prior to February 2014, both Grassi and Sponle spoke with those non-parties. Based on that conversation, rumors began to spread within the Arabian horse community regarding Plaintiffs' actions. In February 2014, Bailey and Cains attended the Scottsdale Arabian Horse Show and it was at that show that Plaintiffs “first heard ‘rumors' that [they] had stolen horse embryos from Sh. Ammar.” (Doc. 74 at 3; Doc. 78 at 2). At that time, Plaintiffs believed the rumors were attributable to statements made by both Grassi and Sponle. (Doc. 78 at 2) (“The Plaintiffs suspected that the Defendants were the source of the rumors that the Plaintiffs had stolen embryos from Sh. Ammar.”). Despite hearing the rumors, and receiving the letter making it abundantly clear that Grassi had told Sh. Ammar the embryo retrieval was unauthorized, Plaintiffs did not file suit at that time.

         For unknown reasons, Sh. Ammar did not file his previously-threatened lawsuit until April 16, 2015. On that date Sh. Ammar sued Bailey, Cains, and Stonewall Farms for, among other things, retrieving embryos from Bella after she was owned by Sh. Ammar. CV-15-1045-PHX-DJH. On April 13, 2016, Sponle was deposed in that suit. During his deposition, Sponle admitted that prior to February 2014 he told Sh. Ammar that Plaintiffs had stolen embryos. In opposing summary judgment in the present suit, Bailey submitted a declaration stating Sponle's deposition was the first time he gained “knowledge of the source of the rumors” regarding embryo theft. (Doc. 79 at 2). Plaintiffs filed the present suit the same day as Sponle's deposition, April 13, 2016. (Doc. 1-2 at 5).


         Grassi and Sponle seek summary judgment by arguing the claims for defamation, false light, and intentional infliction of emotional distress (“IIED”) are untimely. Grassi and Sponle also argue there is insufficient evidence to support the IIED claim. Because ...

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