Mistaken Refusal to Deal Is Privileged; NJCFA Does Not Reach Negotiated TV Ad Buys

Case: Unimed International Inc. v. Fox News Network, LLC, No. 24-2987 (3d Cir. Nov. 13, 2025)

Court: United States Court of Appeals for the Third Circuit (non-precedential)

Panel: Hardiman, Freeman, and Chung, Circuit Judges (opinion by Judge Hardiman)

Introduction

This Third Circuit decision addresses the intersection of tort, consumer-protection, and equity in a dispute arising from a high-dollar advertising campaign. Unimed International, a skincare seller marketing under the Genucel brand, used a two-layer agency structure to buy advertising on Fox News. When Fox placed a credit hold due to unpaid invoices—caused, according to Unimed, by a media buyer’s bulk, non-earmarked payments—Unimed’s ads stopped running. Unimed sued Fox for negligence, tortious interference with prospective economic advantage, and unconscionable commercial practices under the New Jersey Consumer Fraud Act (NJCFA). Fox counterclaimed, inter alia, for unjust enrichment.

The core issues on appeal were:

• Whether a seller’s refusal to continue an at-will business relationship—based even on a mistaken belief arguably attributable to negligent accounting—can support tort claims.
• Whether Fox’s sale of television advertising inventory in negotiated buys qualifies as “merchandise” offered to the public under the NJCFA in a business-to-business context.
• Whether Fox could recover in unjust enrichment for unpaid ad spots notwithstanding Unimed’s “unclean hands” defense premised on Fox’s alleged negligence.

The Third Circuit affirmed summary judgment for Fox on all of Unimed’s claims and on Fox’s unjust-enrichment counterclaim. Although designated “not precedential,” the opinion offers clear guidance on the privilege to refuse to deal in at-will relationships, the limited reach of the NJCFA to complex B2B transactions, and the limits of the unclean-hands defense to quasi-contract claims.

Summary of the Opinion

• Tort claims (negligence and tortious interference): Dismissed because Unimed sought damages for harm stemming from Fox’s refusal to continue doing business. Under New Jersey law, a party is privileged to refuse to enter or continue an at-will business relationship for any reason not otherwise unlawful. That privilege holds even if the refusal rests on a mistaken belief arguably caused by the party’s own negligent accounting. Any duty to continue dealing arises, if at all, from contract—not tort.
• NJCFA claim: Dismissed under the four-factor test in All the Way Towing for business-to-business transactions. Negotiated purchases of national TV ad spots by sophisticated entities are not “merchandise” offered to the public. A public-facing inquiry form on Fox’s website was insufficient to create a triable issue.
• Unjust enrichment counterclaim: Summary judgment for Fox affirmed. Unimed conceded it did not pay for the final batch of ads. The unclean-hands defense failed because Fox had no legal obligation to continue selling ad time and thus did not act inequitably by exercising its lawful prerogative to stop doing business.

Analysis

Procedural Posture and Standard of Review

The case came to the Third Circuit on cross-motions for summary judgment. The court reviewed de novo and affirmed on grounds supported by the record, even if different from the District Court’s reasoning. The parties agreed New Jersey law governed.

Factual Background and Transaction Architecture

Unimed retained Synergixx, an advertising agency, which in turn retained More Media Direct, a media-buying agency, to purchase ad spots on Fox News for Genucel ads (March 2016–March 2017). Fox invoiced More Media; More Media invoiced Synergixx; Synergixx invoiced Unimed. Unimed paid Synergixx roughly $3.2 million over the year. However, More Media paid Fox in lump sums without clear allocation instructions across its clients, leading Fox to credit payments across accounts in a manner that, Unimed contended, did not line up with Unimed’s Genucel spots. By late March 2017, Fox placed a credit hold, stopping Unimed’s ads. Unimed withheld payment for the final batch and sought reconciliation, but Fox conditioned resumption on payment of all delinquent invoices. Unimed refused to take responsibility for balances it believed were owed by Synergixx or More Media, and the campaign ended.

Unimed sued Fox for negligence, tortious interference with prospective economic advantage, and an NJCFA violation. Fox counterclaimed for breach of contract and unjust enrichment. The District Court granted summary judgment to Fox on all of Unimed’s claims and on unjust enrichment. On appeal, Unimed focused on tort theories, NJCFA, and an unclean-hands defense to unjust enrichment.

Precedents Cited and Their Role

• Rothermel v. International Paper Co., 394 A.2d 860 (N.J. App. Div. 1978) and Levin v. Kuhn Loeb & Co., 417 A.2d 79 (N.J. App. Div. 1980): These cases, drawing on Restatement (First) of Torts § 762, establish that a party is not liable in tort for harm caused merely by refusing to enter or to continue a business relationship that is terminable at will. Motives for such refusals are “beyond inquiry” so long as the refusal is not otherwise unlawful. The panel relied heavily on this principle to defeat Unimed’s negligence and tortious-interference claims, which sought damages for the “blackout” of advertising.
• Sons of Thunder, Inc. v. Borden, Inc., 690 A.2d 575 (N.J. 1997): The New Jersey Supreme Court held that, even when a contract is terminable at will, the implied covenant of good faith and fair dealing can restrain bad-faith performance. The Third Circuit distinguished this contract doctrine from tort: Unimed brought no breach-of-contract claim, and the duty it invoked (to continue dealing) sounds in contract, not tort.
• All the Way Towing, LLC v. Bucks County International, Inc., 200 A.3d 398 (N.J. 2019): For B2B transactions, NJCFA applies only if the goods/services are “merchandise,” meaning offered to the public. The court applied this four-factor test—complexity, sophistication of parties, nature of the relationship, and public availability—to conclude that customized, negotiated television ad buys among sophisticated entities are not merchandise offered to the public.
• Iliadis v. Wal–Mart Stores, Inc., 922 A.2d 710 (N.J. 2007): Cited for the basic elements of unjust enrichment under New Jersey law: a benefit conferred, appreciation/knowledge of the benefit, and retention of the benefit under circumstances making it unjust to do so without payment.
• Dobco, Inc. v. Bergen County Improvement Authority, 273 A.3d 406 (N.J. 2022): Quoted for the equitable maxim that a litigant seeking equitable relief must come with clean hands. The court held the defense inapplicable here because Fox’s refusal to continue doing business—lawful under Rothermel/Levin—did not constitute inequitable conduct related to the unpaid advertising.
• Sapa Extrusions, Inc. v. Liberty Mutual Insurance, 939 F.3d 243 (3d Cir. 2019) (de novo review of summary judgment), and Hassen v. Government of the Virgin Islands, 861 F.3d 108 (3d Cir. 2017) (court may affirm on any ground supported by the record): These procedural guideposts underscore the panel’s latitude to refine the District Court’s rationale.

Legal Reasoning

1) Tort claims fail because the harm flows from a privileged refusal to deal

Unimed’s negligence and tortious-interference theories sought lost profits “due to Fox News’s unjustified blackout” of Unimed’s ads. The Third Circuit reframed the dispute: the injury complained of derived from Fox’s decision not to continue selling ad inventory to Unimed, a decision New Jersey law treats as privileged in an at-will commercial relationship. Citing Rothermel, Levin, and Restatement § 762, the court reiterated that the law will not inquire into a party’s motives for refusing to continue an at-will business relationship unless the refusal is “otherwise unlawful” (for example, statutorily prohibited discrimination or antitrust violations, which were not alleged here). Even if Fox’s mistaken belief about Unimed’s arrearage stemmed from negligent payment allocation, that negligence does not convert a privileged refusal to deal into a tort.

Crucially, the court observed that any obligation to continue selling inventory would arise, if at all, from contract. Unimed did not bring a breach-of-contract claim, and its reliance on Sons of Thunder was misplaced because the implied covenant of good faith and fair dealing is a contract doctrine, not a tort principle.

Notably, a footnote indicates Judge Chung would have gone further, concluding Fox owed no duty of care to Unimed in apportioning More Media’s payments—an alternative ground that would independently defeat negligence. The panel did not reach that question, having disposed of the tort claims on the refusal-to-deal privilege.

2) NJCFA inapplicable: negotiated TV ad buys are not “merchandise” offered to the public in a B2B setting

New Jersey’s Consumer Fraud Act reaches unconscionable practices “in connection with the sale” of “merchandise,” defined to include services “offered, directly or indirectly to the public for sale.” In B2B transactions, courts assess four factors (from All the Way Towing) to determine whether the goods/services are the type of standardized, publicly available offerings the NJCFA is designed to regulate.

Applying those factors, the court held:

• Complexity (Factor 1): The transactions were multi-step, negotiated media buys that involved rate negotiations and multi-party coordination—hallmarks of bespoke commercial dealings, not off-the-shelf merchandise.
• Identity and sophistication of the parties (Factor 2): All participants—Unimed, Synergixx, More Media, and Fox—were sophisticated commercial entities. The presence of professional intermediaries underscored the specialized nature of the transactions.
• Nature of the relationship (Factor 3): The parties transacted repeatedly over a year through intermediaries, reflecting an ongoing, customized commercial relationship rather than a one-off consumer sale.
• Public availability (Factor 4): Although Fox’s website allowed members of the public to submit an advertising inquiry, there was no evidence that Fox actually sells national ad inventory to the general public outside of negotiated, professionalized processes. A public-facing inquiry portal, without more, does not transform negotiated inventory into NJCFA “merchandise.”

With three factors strongly against NJCFA coverage and only minimal evidence on the fourth, Unimed could not raise a genuine dispute of material fact. Summary judgment for Fox followed.

3) Unjust enrichment stands; unclean hands fails because the refusal to deal was lawful

Unimed did not dispute that it received the benefit of the final batch of ads and did not pay for them. That admission satisfied the core elements of unjust enrichment under New Jersey law. Unimed instead invoked “unclean hands,” arguing Fox’s prior negligence in allocating payments tainted its equitable claim. The court rejected that defense. Any alleged negligence manifested in Fox’s decision to stop selling ad time—a choice the law protects in at-will commercial relationships. Exercising a lawful right is not inequitable conduct that bars equitable relief. Accordingly, unjust enrichment was properly awarded to Fox.

Impact and Practical Implications

• Reaffirmation of the refusal-to-deal privilege in tort: Businesses may refuse to begin or continue at-will commercial relationships without incurring tort liability for resulting economic harms, absent an independent unlawful basis. Plaintiffs cannot repackage the fallout from a counterparty’s lawful refusal to deal into negligence or tortious-interference claims simply by alleging errors or even negligence that led to the refusal.
• Contract, not tort, polices continuity obligations: If a party seeks to constrain a counterparty’s ability to stop doing business, the proper vehicle is contract (including express termination provisions and the implied covenant of good faith). Plaintiffs should carefully assess and plead contract claims where applicable; relying on tort alone will often fail.
• NJCFA’s limited reach in sophisticated B2B services: Post–All the Way Towing, complex, negotiated services provided among sophisticated entities—like national television advertising inventory—generally fall outside the NJCFA’s “merchandise” concept. A public inquiry form or marketing page does not, without more, establish that the service is offered to the general public. This reasoning likely extends to other specialized B2B services (e.g., bespoke technology integrations, wholesale bandwidth, custom logistics) that require negotiation and professional intermediation.
• Equity follows the law: unclean hands is narrow: The decision underscores that equitable defenses do not trump legal privileges. Where a party lawfully refuses to continue a business relationship, equity will not bar recovery for benefits conferred and retained without payment.
• Media-buying risk allocation: The opinion highlights a recurrent industry risk: multi-layered agency chains, bulk payments, and allocation ambiguity. Advertisers, agencies, and networks should consider clear contractual allocation instructions, audit rights, and “sequential liability” or similar provisions to reduce exposure when intermediaries default or misallocate funds.
• Appellate practice note: The panel affirmed on a slightly different ground than the District Court, illustrating the importance of building a record that supports multiple independent bases for judgment. The footnoted concurrence hint (no duty of care) signals additional arguments defendants may pursue at the trial level in payment-allocation disputes.

Complex Concepts Simplified

• At-will business relationship: A commercial arrangement that either party may end at any time, for any lawful reason. Unless a contract says otherwise, there is no legal duty to continue doing business.
• Refusal-to-deal privilege (tort law): Under New Jersey law (following Restatement § 762), a party is not liable in tort for harm caused by refusing to enter or continue a business relationship that is terminable at will. Courts do not scrutinize motives unless the refusal independently violates the law (e.g., discrimination or antitrust).
• Tortious interference with prospective economic advantage: A tort where a defendant intentionally and unjustifiably interferes with a plaintiff’s expected economic relationship. The refusal-to-deal privilege limits such claims when the alleged harm is simply the defendant’s choice not to continue doing business with the plaintiff.
• Implied covenant of good faith and fair dealing: A contract doctrine that requires parties to exercise their contractual rights honestly and in good faith. It cannot create obligations where no contract claim is pleaded and does not convert a contract dispute into a tort.
• NJCFA “merchandise” in B2B transactions: For business-to-business deals, NJCFA applies only if the goods or services are the type offered to the general public. Courts consider complexity, sophistication of parties, their relationship, and public availability. Customized, negotiated services among sophisticated entities typically fall outside the statute.
• Unjust enrichment: A quasi-contract claim to recover the value of benefits conferred and retained without payment, where it would be unjust for the recipient to keep the benefit. It does not require a written contract.
• Unclean hands: An equitable defense that bars relief when the plaintiff engaged in inequitable conduct related to the subject matter of the claim. Exercising a lawful right (like refusing to deal at will) is not “unclean.”
• Summary judgment: A procedure to resolve a case without trial when there is no genuine dispute of material fact and the moving party is entitled to judgment as a matter of law.
• Affirm on any ground: On appeal, a court may affirm a lower court’s judgment based on any ground supported by the record, even if the lower court relied on different reasoning.

What the Panel Did Not Decide

• Duty of care in payment allocation: Judge Chung would have held there was no duty of care owed by Fox to Unimed in allocating More Media’s bulk payments. The majority did not reach the duty question, resolving the tort claims on the refusal-to-deal privilege. Future cases may squarely address whether media sellers owe such a duty absent clear allocation instructions from an intermediary.
• Alleged embezzlement by Synergixx: Fox alleged Synergixx embezzled Unimed’s funds; Unimed disputed it. The District Court and the Third Circuit did not resolve this factual dispute because it did not affect the dispositive legal rulings.
• Contract claims: Unimed did not pursue a breach-of-contract claim against Fox, and the opinion does not analyze the contract counterclaim that Fox initially asserted. The decision leaves open how express contract terms—such as termination clauses, allocation protocols, and sequential liability provisions—might change the outcome.

Conclusion

Unimed v. Fox clarifies three important points under New Jersey law. First, the refusal-to-deal privilege robustly shields businesses from tort liability when they end at-will relationships—even if the refusal rests on a mistaken belief arising from the business’s own negligence—so long as no independent illegality is involved. Second, the NJCFA does not extend to complex, negotiated B2B services like national television ad buys; a public-facing inquiry form is not enough to show the service is “offered to the public.” Third, equitable defenses such as unclean hands do not bar recovery in unjust enrichment when the alleged “unclean” conduct consists of exercising a lawful right to stop doing business.

Although not precedential, the opinion offers persuasive guidance to advertisers, agencies, and media companies on risk allocation in multi-intermediary payment chains and underscores a broader doctrinal message: when the alleged wrongdoing is the cessation of an at-will relationship, the law looks to contract—not tort or consumer-fraud statutes—to supply any continuing duties. Plaintiffs should tailor their pleadings accordingly, and commercial actors should draft with precision to manage the risks of complex payment flows and credit holds.