Benajmin "B.J." Reynolds, Mark Mewshaw and Wes Hobbs and Terra Energy Partners LLC v. Sanchez Oil & Gas Corporation
This text of Benajmin "B.J." Reynolds, Mark Mewshaw and Wes Hobbs and Terra Energy Partners LLC v. Sanchez Oil & Gas Corporation (Benajmin "B.J." Reynolds, Mark Mewshaw and Wes Hobbs and Terra Energy Partners LLC v. Sanchez Oil & Gas Corporation) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.
Opinion
Opinion issued November 30, 2023
In The
Court of Appeals For The
First District of Texas ———————————— NO. 01-18-00940-CV ——————————— BENJAMIN “B.J.” REYNOLDS, MARK MEWSHAW, WES HOBBS, AND TERRA ENERGY PARTNERS LLC, Appellants V. SANCHEZ OIL AND GAS CORPORATION, SANCHEZ ENERGY CORPORATION, AND SANCHEZ PRODUCTION PARTNERS LP, Appellees
On Appeal from the 11th District Court Harris County, Texas Trial Court Case No. 2016-18909
MEMORANDUM OPINION ON REHEARING
Appellants Benjamin “B.J.” Reynolds, Mark Mewshaw, Wes Hobbs
(collectively, the “individual appellants”), and Terra Energy Partners LLC (“Terra”) have moved for rehearing of our May 9, 2023 opinion and judgment. We grant the
motion for rehearing, withdraw our May 9, 2023 opinion and judgment, and issue
this opinion and judgment in their stead.
This interlocutory appeal returns to this Court on remand from the Texas
Supreme Court with instructions to reconsider our prior holding in light of
intervening precedent and to reach any remaining issues as necessary to dispose of
this appeal. The individual appellants and Terra appeal the denial of their amended
motion to dismiss under the Texas Citizens Participation Act (“TCPA”).1
Appellants raise five issues on appeal.2 In their first three issues, appellants
argue that the trial court erred by denying their amended TCPA dismissal motion
because it was timely filed; appellees did not meet their burden to establish by clear
and specific evidence a prima facie case of each element of the challenged claims;
1 In 2019, the Texas Legislature amended several provisions of the TCPA. The amendments became effective on September 1, 2019, and they apply to cases filed on or after that date. Creative Oil & Gas, LLC v. Lona Hills Ranch, LLC, 591 S.W.3d 127, 129 (Tex. 2019) (citing Act of May 17, 2019, 86th Leg., R.S., ch. 378, 2019 Tex. Gen. Laws 684). “The prior version of the statute continues, however, to control cases filed before September 1, 2019.” Id.; see Gardner v. Tuskey, No. 01- 19-00599-CV, 2020 WL 2069809, at *1 n.1 (Tex. App.—Houston [1st Dist.] Apr. 30, 2020, no pet.) (mem. op.). This case was filed before September 1, 2019, so it is governed by the pre-amendment version of the statute. See Creative Oil, 591 S.W.3d at 129; Gardner, 2020 WL 2069809, at *1 n.1. All citations to the TCPA in this opinion are to the pre-amendment version of the statute. 2 Appellants also raise the issue of whether the TCPA applies to the challenged claims, but the Sanchez parties do not dispute this issue. Accordingly, we do not list it as a separate issue.
2 and appellants met their burden to establish defenses to some of the challenged
claims.3 As part of their second issue, appellants contend that appellees lack standing
to assert their trade secret misappropriation claims, and therefore the trial court
lacked subject-matter jurisdiction over these claims. In their fourth issue, appellants
argue that the trial court abused its discretion by finding that the amended TCPA
dismissal motion was solely intended to delay, a necessary finding to support an
award of attorney’s fees and costs to appellees as responding parties under the
TCPA. Finally, in their fifth issue, appellants argue that they are entitled to attorney’s
fees under Civil Practice and Remedies Code section 27.009. After reconsidering
our prior holding and reaching the remaining issues that are necessary to dispose of
this appeal, we affirm in part, reverse and render judgment in part, and reverse and
remand in part.
Background
Appellees Sanchez Oil and Gas Corp., Sanchez Energy Corp., and Sanchez
Production Partners LP (collectively “Sanchez” or the “Sanchez parties”) are
affiliated entities engaged in the business of oil exploration and production in Texas
and in the Gulf Coast, Mid-Continent, and Rocky Mountain regions. Over the course
3 Terra and the individual appellants filed separate briefs presenting the same issues but in a different order. We have adopted the order of issues presented in Terra’s briefs.
3 of their forty-five years in operation, the Sanchez parties have allegedly invested in
and developed “a wide array of valuable trade secret materials” that provides them
with “extensive competitive advantages in the oil and gas industry.”
The Sanchez parties allege that these trade secrets consist of bidding,
acquisition, and due diligence files related to large oil-and-gas assets; vendor lists
with pricing and contact information; project files including cost trackers, invoices,
proposals, financial data and projections, engineering schematics, and various
internal reports; and geologic and production data.
The Sanchez parties ultimately organized their trade secrets into eight
categories with multiple subcategories. One category is a cost-reduction program,
which the Sanchez parties argue allows them “to track and negotiate competitive and
confidential unit-cost rates from vendors.” The Sanchez parties argue that they are
“an industry leader in cost reduction[.]” Another category is “a library of well and
operations data” and business development files that the Sanchez parties used to
analyze potential acquisitions. This library also includes subsurface data, such as
seismic data, well logs, core samples, and other geotechnical and geophysical
information. Finally, the trade secrets also consist of operational data, drilling
manuals containing Sanchez’s best practices, and facilities designs and diagrams.
The Sanchez parties allegedly employed confidentiality agreements,
computer security software, and other measures to protect their confidential
4 information and trade secrets. For example, the employee handbook requires
employees to maintain strict confidentiality of all confidential information,
including Sanchez trade secrets, and to return all confidential information if the
employee is terminated. Confidential information is provided to employees on a
need-to-know basis and is contained in computer files that employees access with a
username and password, and computer security software tracks employees’ access
to the files. When the Sanchez parties provide third-party vendors with access to
confidential information, the vendors are required to sign agreements containing
confidentiality clauses. The Sanchez parties require visitors to their offices to be
escorted at all times, and the companies prohibit exposing confidential information
to visitors.
In 2014, the Sanchez parties hired the three individual appellants as engineers.
As part of their jobs, they were required to access the Sanchez parties’ confidential
information. They each signed the employee handbook requiring them to maintain
strict confidentiality of the Sanchez parties’ confidential information.
In July 2015, Reynolds accepted employment with the Sanchez parties’
“direct competitor,” Terra. Shortly after it was established earlier that year, Terra
began soliciting Reynolds for employment and eventually hired him as a vice
president of operations. The day after accepting employment with Terra but before
resigning from Sanchez, Reynolds allegedly copied several thousand confidential
5 files from the Sanchez parties’ computers onto a thumb drive without permission.
After notifying the Sanchez parties of his resignation, Reynolds allegedly purchased
an external hard drive and downloaded thousands more files without Sanchez’s
permission.
Free access — add to your briefcase to read the full text and ask questions with AI
Opinion issued November 30, 2023
In The
Court of Appeals For The
First District of Texas ———————————— NO. 01-18-00940-CV ——————————— BENJAMIN “B.J.” REYNOLDS, MARK MEWSHAW, WES HOBBS, AND TERRA ENERGY PARTNERS LLC, Appellants V. SANCHEZ OIL AND GAS CORPORATION, SANCHEZ ENERGY CORPORATION, AND SANCHEZ PRODUCTION PARTNERS LP, Appellees
On Appeal from the 11th District Court Harris County, Texas Trial Court Case No. 2016-18909
MEMORANDUM OPINION ON REHEARING
Appellants Benjamin “B.J.” Reynolds, Mark Mewshaw, Wes Hobbs
(collectively, the “individual appellants”), and Terra Energy Partners LLC (“Terra”) have moved for rehearing of our May 9, 2023 opinion and judgment. We grant the
motion for rehearing, withdraw our May 9, 2023 opinion and judgment, and issue
this opinion and judgment in their stead.
This interlocutory appeal returns to this Court on remand from the Texas
Supreme Court with instructions to reconsider our prior holding in light of
intervening precedent and to reach any remaining issues as necessary to dispose of
this appeal. The individual appellants and Terra appeal the denial of their amended
motion to dismiss under the Texas Citizens Participation Act (“TCPA”).1
Appellants raise five issues on appeal.2 In their first three issues, appellants
argue that the trial court erred by denying their amended TCPA dismissal motion
because it was timely filed; appellees did not meet their burden to establish by clear
and specific evidence a prima facie case of each element of the challenged claims;
1 In 2019, the Texas Legislature amended several provisions of the TCPA. The amendments became effective on September 1, 2019, and they apply to cases filed on or after that date. Creative Oil & Gas, LLC v. Lona Hills Ranch, LLC, 591 S.W.3d 127, 129 (Tex. 2019) (citing Act of May 17, 2019, 86th Leg., R.S., ch. 378, 2019 Tex. Gen. Laws 684). “The prior version of the statute continues, however, to control cases filed before September 1, 2019.” Id.; see Gardner v. Tuskey, No. 01- 19-00599-CV, 2020 WL 2069809, at *1 n.1 (Tex. App.—Houston [1st Dist.] Apr. 30, 2020, no pet.) (mem. op.). This case was filed before September 1, 2019, so it is governed by the pre-amendment version of the statute. See Creative Oil, 591 S.W.3d at 129; Gardner, 2020 WL 2069809, at *1 n.1. All citations to the TCPA in this opinion are to the pre-amendment version of the statute. 2 Appellants also raise the issue of whether the TCPA applies to the challenged claims, but the Sanchez parties do not dispute this issue. Accordingly, we do not list it as a separate issue.
2 and appellants met their burden to establish defenses to some of the challenged
claims.3 As part of their second issue, appellants contend that appellees lack standing
to assert their trade secret misappropriation claims, and therefore the trial court
lacked subject-matter jurisdiction over these claims. In their fourth issue, appellants
argue that the trial court abused its discretion by finding that the amended TCPA
dismissal motion was solely intended to delay, a necessary finding to support an
award of attorney’s fees and costs to appellees as responding parties under the
TCPA. Finally, in their fifth issue, appellants argue that they are entitled to attorney’s
fees under Civil Practice and Remedies Code section 27.009. After reconsidering
our prior holding and reaching the remaining issues that are necessary to dispose of
this appeal, we affirm in part, reverse and render judgment in part, and reverse and
remand in part.
Background
Appellees Sanchez Oil and Gas Corp., Sanchez Energy Corp., and Sanchez
Production Partners LP (collectively “Sanchez” or the “Sanchez parties”) are
affiliated entities engaged in the business of oil exploration and production in Texas
and in the Gulf Coast, Mid-Continent, and Rocky Mountain regions. Over the course
3 Terra and the individual appellants filed separate briefs presenting the same issues but in a different order. We have adopted the order of issues presented in Terra’s briefs.
3 of their forty-five years in operation, the Sanchez parties have allegedly invested in
and developed “a wide array of valuable trade secret materials” that provides them
with “extensive competitive advantages in the oil and gas industry.”
The Sanchez parties allege that these trade secrets consist of bidding,
acquisition, and due diligence files related to large oil-and-gas assets; vendor lists
with pricing and contact information; project files including cost trackers, invoices,
proposals, financial data and projections, engineering schematics, and various
internal reports; and geologic and production data.
The Sanchez parties ultimately organized their trade secrets into eight
categories with multiple subcategories. One category is a cost-reduction program,
which the Sanchez parties argue allows them “to track and negotiate competitive and
confidential unit-cost rates from vendors.” The Sanchez parties argue that they are
“an industry leader in cost reduction[.]” Another category is “a library of well and
operations data” and business development files that the Sanchez parties used to
analyze potential acquisitions. This library also includes subsurface data, such as
seismic data, well logs, core samples, and other geotechnical and geophysical
information. Finally, the trade secrets also consist of operational data, drilling
manuals containing Sanchez’s best practices, and facilities designs and diagrams.
The Sanchez parties allegedly employed confidentiality agreements,
computer security software, and other measures to protect their confidential
4 information and trade secrets. For example, the employee handbook requires
employees to maintain strict confidentiality of all confidential information,
including Sanchez trade secrets, and to return all confidential information if the
employee is terminated. Confidential information is provided to employees on a
need-to-know basis and is contained in computer files that employees access with a
username and password, and computer security software tracks employees’ access
to the files. When the Sanchez parties provide third-party vendors with access to
confidential information, the vendors are required to sign agreements containing
confidentiality clauses. The Sanchez parties require visitors to their offices to be
escorted at all times, and the companies prohibit exposing confidential information
to visitors.
In 2014, the Sanchez parties hired the three individual appellants as engineers.
As part of their jobs, they were required to access the Sanchez parties’ confidential
information. They each signed the employee handbook requiring them to maintain
strict confidentiality of the Sanchez parties’ confidential information.
In July 2015, Reynolds accepted employment with the Sanchez parties’
“direct competitor,” Terra. Shortly after it was established earlier that year, Terra
began soliciting Reynolds for employment and eventually hired him as a vice
president of operations. The day after accepting employment with Terra but before
resigning from Sanchez, Reynolds allegedly copied several thousand confidential
5 files from the Sanchez parties’ computers onto a thumb drive without permission.
After notifying the Sanchez parties of his resignation, Reynolds allegedly purchased
an external hard drive and downloaded thousands more files without Sanchez’s
permission. Reynolds also allegedly emailed himself a list of all the Sanchez parties’
vendors and suppliers. Forensic analysis and other evidence showed that Reynolds
regularly accessed these files from his Terra-issued laptop shortly after beginning
employment at Terra. The Sanchez parties alleged that he took these files on behalf
of and with the encouragement of Terra.
Once employed at Terra, Reynolds assisted Terra in bidding on potential oil
field assets by examining cost data and performing technical and cost analysis. At
least one of Terra’s bids was in direct competition with the Sanchez parties.
Reynolds’ work and alleged use of the Sanchez parties’ confidential information and
trade secrets helped Terra obtain financial backing for the company.
Reynolds and Terra allegedly began soliciting other employees from the
Sanchez parties. Eventually, both Mewshaw and Hobbs resigned from Sanchez and
went to work for Terra. The Sanchez parties alleged that before resigning and
without their permission, Mewshaw copied approximately 30,000 files from
Sanchez computer servers onto an external hard drive, and Hobbs also copied
Sanchez files onto a cloud storage account. Many of these files contained trade
6 secrets and other confidential information. Mewshaw also allegedly solicited
Sanchez employees to join Terra while he was still employed at Sanchez.
Shortly before filing the underlying lawsuit, the Sanchez parties discovered
that the individual appellants had allegedly copied and taken the files, many of which
contained valuable trade secrets and confidential information. Sanchez demanded
the return of these files, but appellants initially rebuffed these demands.
In March 2016, the Sanchez parties filed suit against appellants and asserted
claims for misappropriation of trade secrets, breach of fiduciary duties, aiding and
abetting breach of fiduciary duties, breach of contract, and violation of the Harmful
Access by Computer Act. See TEX. CIV. PRAC. & REM. CODE § 143.001(a). The
Sanchez parties also sought injunctive relief and obtained a temporary restraining
order requiring appellants to return all of the Sanchez parties’ files. The individual
appellants returned more than fifteen storage devices containing files they allegedly
took from the Sanchez parties.
In July 2016, the Sanchez parties filed a first amended petition that was
virtually identical to the original petition.
In July 2018, the Sanchez parties filed a second amended petition, which
included many of the claims previously asserted. However, instead of asserting a
claim for aiding and abetting breach of fiduciary duties, as in the first two petitions,
the second amended petition substituted two causes of action based on breach of
7 fiduciary duties: Count 6 for assisting or encouraging breaches of fiduciary duties
and Count 7 for assisting and participating in breaches of fiduciary duties.
Other relevant differences exist between the second amended petition and the
prior petitions. For example, while the prior petitions alleged that Terra hired
Reynolds as a vice president of operations and encouraged his misappropriation of
Sanchez’s trade secrets and other information, the second amended petition added
that Reynolds “act[ed] on behalf of and as an officer of his new employer Terra”
when he took the Sanchez parties’ trade secrets. The petition also added that “Terra
is directly and/or vicariously liable for all of Reynolds’ actions set forth herein.” The
petition also added some language about meetings and discussions between
appellants in furtherance of their alleged misappropriation of trade secrets.
Within sixty days of the filing of the second amended petition, appellants filed
the amended motion to dismiss under the TCPA, which is the motion at issue in this
appeal.4 The amended TCPA motion sought to dismiss all causes of action except
the action for violation of the Harmful Access by Computer Act. The primary dispute
concerned whether each of the challenged claims in the second amended petition
4 In their original motion to dismiss, appellants sought to dismiss only Counts 2–4, which were claims derivative of the Sanchez parties’ misappropriation of trade secrets cause of action. The Sanchez parties filed a notice of nonsuit of these challenged claims and a notice of non-opposition to the motion to dismiss. The trial court signed an order granting the original TCPA motion and dismissing these three causes of action with prejudice. These claims are not at issue in this appeal.
8 constituted a new “legal action” under the TCPA, which triggers a new sixty-day
deadline to seek dismissal. After a lengthy oral hearing, the trial court entered a
written order denying the amended TCPA motion. The order included a finding that
appellants filed the amended TCPA motion solely intending to delay the proceeding
and stated that the court would award attorney’s fees and costs to the Sanchez parties
in a separate order. Appellants appealed.
On appeal, this Court affirmed. See generally Reynolds v. Sanchez Oil & Gas
Corp., 617 S.W.3d 30 (Tex. App.—Houston [1st Dist.] 2020), vacated, 635 S.W.3d
636 (Tex. 2021) (per curiam). The Court held that the amended TCPA motion was
untimely because the second amended petition did not assert a new “legal action,”
as defined by the TCPA. Therefore, the second amended petition did not trigger a
new deadline to file a TCPA motion. Id. at 50.
After our opinion issued in this appeal, the Texas Supreme Court handed
down two opinions that conflicted with our opinion. See Montelongo v. Abrea, 622
S.W.3d 290 (Tex. 2021); Kinder Morgan SACROC, LP v. Scurry Cnty., 622 S.W.3d
835 (Tex. 2021). Appellants petitioned the Texas Supreme Court for review.
Without hearing oral argument, the Texas Supreme Court vacated our judgment in
this case and remanded to this Court to reconsider our holding in light of Montelongo
and Kinder Morgan and to reach any remaining issues necessary to dispose of this
appeal. Reynolds, 635 S.W.3d at 637.
9 The parties filed supplemental briefs on remand. We now reconsider our prior
holding and any remaining issues necessary to dispose of this appeal.
Standing
In part of its second issue, Terra argues that the Sanchez parties did not prove
they owned the trade secrets at issue and therefore did not establish standing to assert
their claims.
Standing is a component of subject-matter jurisdiction, which is “essential to
the authority of a court to decide a case,” and it may be raised at any time. Tex. Ass’n
of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440, 443–44, 445 (Tex. 1993); see State
Bar of Tex. v. Gomez, 891 S.W.2d 243, 245 (Tex. 1994) (stating that court must have
subject-matter jurisdiction before it may address merits of case). To establish
standing, a plaintiff must allege an injury in fact that is fairly traceable to the
defendant’s wrongful conduct and likely to be redressed by the requested relief.
Heckman v. Williamson Cnty., 369 S.W.3d 137, 154–56 (Tex. 2012); Holcomb v.
Waller Cnty., 546 S.W.3d 833, 837 (Tex. App.—Houston [1st Dist.] 2018, pet.
denied) (“We begin our [standing] analysis by identifying the alleged wrong and
deciding whether there was a causal connection between the defendant’s actions and
the injury caused by the alleged wrong.”).
Whether a court has subject-matter jurisdiction is an issue of law that we
review de novo. Tex. Dep’t of Parks & Wildlife v. Miranda, 133 S.W.3d 217, 225–
10 26 (Tex. 2004). A defendant may challenge the court’s jurisdiction by challenging
the pleadings or the existence of jurisdictional facts. Id. at 226–27. If the pleadings
are challenged, we determine whether the pleader has alleged facts affirmatively
demonstrating the court’s jurisdiction. Id. at 226. We construe the pleadings liberally
in favor of the pleader, look to the pleader’s intent, and accept as true the
unchallenged factual jurisdictional allegations in the pleadings. Id. If the challenge
is to the existence of jurisdictional facts, the challenger must first assert—and
support with evidence—that the trial court lacks subject-matter jurisdiction. Id. at
228. If the challenger supports the assertion with evidence, then the plaintiff must
show that a disputed material fact exists regarding the jurisdictional issue. Id. In sum,
if the pleadings sufficiently demonstrate jurisdiction and the defendant does not
challenge the factual allegations with supporting evidence, then our inquiry ends. Id.
at 226–28; Buzbee v. Clear Channel Outdoor, LLC, 616 S.W.3d 14, 23 (Tex. App.—
Houston [14th Dist.] 2020, no pet.).
In their second amended petition, the Sanchez parties alleged that they own
numerous trade secrets which they developed over their forty-five-year company
history. They alleged that the individual appellants violated their contractual and
legal duties by copying and taking “thousands of digital files containing an even
larger number of documents, emails, and email attachments with them when they
left” their employment with the Sanchez parties. They also alleged that Terra and
11 the individual appellants improperly solicited their employees. The claim for
misappropriation of trade secrets expressly alleged that appellants “have
misappropriated numerous trade secrets owned by Sanchez and have thereby caused
damage to Sanchez and unjustly enriched themselves.” The petition sought damages
for these claims.
These factual allegations demonstrate that the Sanchez parties were injured
by the alleged theft, disclosure, and use of their valuable trade secrets and other
confidential information and by the solicitation of their employees. Furthermore,
these injuries are fairly traceable to each appellant’s conduct and likely to be
redressed by the requested damages. See Heckman, 369 S.W.3d at 154–55 (stating
that standing requires injury in fact fairly traceable to defendant’s wrongful conduct
and likely redressable by requested relief and that injury alleged must be personal to
plaintiff, actual or imminent, concrete and particularized, and not hypothetical).
Thus, the factual allegations in the petition establish that the Sanchez parties have
standing to assert their claims. See Miranda, 133 S.W.3d at 226.
Terra does not challenge the pleadings, but instead argues that under the
TCPA’s burden-shifting framework, the Sanchez parties were required to prove their
standing—specifically, their ownership over the trade secrets and other confidential
information—by clear and specific evidence. See TEX. CIV. PRAC. & REM. CODE
§ 27.005(c) (“The court may not dismiss a legal action under [the TCPA] if the party
12 bringing the legal action establishes by clear and specific evidence a prima facie case
for each essential element of the claim in question.”). Terra cites no authority
supporting this argument.
The Fourteenth Court of Appeals has considered this issue and held that “the
TCPA burden-shifting procedure is not a proper framework to analyze appellees’
standing and mootness arguments, and we are not constrained to analyze those
arguments under the TCPA rubric even though appellees brought them to the court’s
attention in the context of such a motion.” Buzbee, 616 S.W.3d at 23. Although
subject-matter jurisdiction can be challenged by different means, such as a plea to
the jurisdiction or a motion for summary judgment, “it does not follow that a court
must analyze jurisdiction using the TCPA burden-shifting procedure, a mechanism
ill-suited for resolving whether a court is authorized to decide a controversy.” Id. at
22. “[T]he absence of standing at the outset of a lawsuit deprives the court of
jurisdiction to apply the TCPA at all.” Id.
We agree with this reasoning and conclude that the Sanchez parties were not
required to prove standing by clear and specific evidence as part of their burden
under the TCPA framework. Rather, the Sanchez parties were required to plead facts
affirmatively demonstrating the court’s jurisdiction, and we have already determined
that they met this burden. See Miranda, 133 S.W.3d 226. Terra did not present any
evidence negating the jurisdictional allegations, and therefore the Sanchez parties
13 were not required to prove that a disputed material fact existed regarding standing.
See id. at 226–28; Buzbee, 616 S.W.3d at 23. We conclude that the Sanchez parties
have standing to assert their claims. We overrule Terra’s jurisdictional sub-issue.
Texas Citizens Participation Act
The TCPA is an anti-SLAPP (Strategic Lawsuits Against Public Participation)
statute enacted by the Texas Legislature “to encourage and safeguard the
constitutional rights of persons to petition, speak freely, associate freely, and
otherwise participate in government to the maximum extent permitted by law and,
at the same time, protect the rights of a person to file meritorious lawsuits for
demonstrable injury.” TEX. CIV. PRAC. & REM. CODE § 27.002; see In re Lipsky, 460
S.W.3d 579, 586 (Tex. 2015) (stating that TCPA “protects citizens from retaliatory
lawsuits that seek to intimidate or silence them on matters of public concern”).
Within certain prescribed time limits, the TCPA authorizes a defendant to move to
dismiss claims that relate to the defendant’s exercise of these rights. TEX. CIV. PRAC.
& REM. CODE § 27.003(a), (b); Dallas Morning News, Inc. v. Hall, 579 S.W.3d 370,
376 (Tex. 2019). If a TCPA dismissal motion is timely filed, courts employ a three-
step burden-shifting decisional process to determine whether dismissal is
appropriate. TEX. CIV. PRAC. & REM. CODE §§ 27.003(a), 27.005(b)–(d).
This case requires us to decide whether appellants timely filed the motion to
dismiss claims asserted in the Sanchez parties’ second amended petition and, if so,
14 whether dismissal is appropriate under the TCPA’s three-step burden-shifting
framework.
A. Standard of Review
We review de novo a trial court’s denial of a TCPA dismissal motion.
Mattress Firm, Inc. v. Deitch, 612 S.W.3d 467, 478 (Tex. App.—Houston [1st Dist.]
2020, pet. denied); Gaskamp v. WSP USA, Inc., 596 S.W.3d 457, 470 (Tex. App.—
Houston [1st Dist.] 2020, pet dism’d) (en banc). In conducting our review, we
consider the pleadings and supporting and opposing affidavits in a light most
favorable to the nonmovant. TEX. CIV. PRAC. & REM. CODE § 27.006(a); Deitch, 612
S.W.3d at 478; Gaskamp, 596 S.W.3d at 470.
Whether the TCPA applies to a particular claim is an issue of statutory
interpretation that we review de novo. Youngkin v. Hines, 546 S.W.3d 675, 680 (Tex.
2018). Our objective in construing a statute is to ascertain and give effect to the
Legislature’s intent as expressed in the language of the statute. Id. We construe
statutory terms “according to their plain and common meaning, unless a contrary
intention is apparent from the context, or unless such a construction leads to absurd
results.” Id. (quoting City of Rockwall v. Hughes, 246 S.W.3d 621, 625–26 (Tex.
2008)). We must consider the specific statutory language at issue and the statute as
a whole. In re Off. of Att’y Gen., 422 S.W.3d 623, 629 (Tex. 2013) (orig.
proceeding); see Youngkin, 546 S.W.3d at 680 (“[L]egislative intent derives from an
15 act as a whole rather than from isolated portions of it.”). We “endeavor to read the
statute contextually, giving effect to every word, clause, and sentence.” In re Off. of
Att’y Gen., 422 S.W.3d at 629.
B. Timeliness of Motion to Dismiss under TCPA
In their first issue, appellants argue that their amended TCPA motion was
timely filed after the Sanchez parties filed their second amended petition.
1. Applicable Law
A motion to dismiss under the TCPA “must be filed not later than the 60th
day after the date of service of the legal action” that the party seeks to dismiss. TEX.
CIV. PRAC. & REM. CODE § 27.003(b). The TCPA defines “legal action” as “a
lawsuit, cause of action, petition, complaint, cross-claim, or counterclaim or any
other judicial pleading or filing that requests legal or equitable relief.” Id.
§ 27.001(6).
The Texas Supreme Court recently issued two opinions interpreting the phrase
“cause of action” within the TCPA’s definition of “legal action.” See id. In
Montelongo, the court held that
an amended or supplemental pleading that asserts the same legal claims or theories by and against the same parties and based on the same essential facts alleged in a prior pleading asserts the same “legal action” to which the sixty-day period previously applied and thus does not trigger a new sixty-day period for filing a dismissal motion. But to the extent an amended or supplemental pleading either (1) adds a new party or parties, (2) alleges new essential facts to support previously asserted claims, or (3) asserts new legal claims or theories involving different
16 elements than the claims or theories previously asserted, the new pleading asserts a new legal action and triggers a new sixty-day period as to those new parties, facts, or claims.
622 S.W.3d at 293–94. The court clarified that “[a] new claim that does not involve
different elements, however, or that is merely a ‘subset’ of previously filed claims,
does not assert a new legal action.” Id. at 301 (citations omitted). Montelongo
specifically concerned the third category mentioned above—whether an amended
petition adding new legal claims based on the same essential facts previously alleged
constitutes a new legal action triggering a new sixty-day period to file a dismissal
motion. Id. at 293.
In Kinder Morgan, the court considered the second category of a new “legal
action”: a TCPA motion seeking dismissal of new essential factual allegations in an
amended petition. 622 S.W.3d at 838. In that case, Scurry County filed suit seeking
reappraisal of unspecified property owned by Kinder Morgan, alleging that the
property had been undervalued for ad valorem tax purposes. Id. at 839. The original
petition contained no factual allegations, but an amended petition added numerous
facts, including that Kinder Morgan knowingly and purposefully provided
inaccurate or incomplete information in tax filings. Id. at 839–41.
Kinder Morgan sought dismissal under the TCPA, arguing that the allegations
added in the amended petition for the first time implicated its constitutional rights to
speak freely and to petition the government. Id. at 840–41. On appeal, the Texas
17 Supreme Court reasoned that the prior petitions did not provide fair notice of the
essential factual allegations raised in the amended petition:
A cause of action is sufficiently pleaded only if the petition gives fair notice of the claim involved. The key inquiry is whether the opposing party can ascertain from the pleading the nature and basic issues of the controversy and what testimony will be relevant. Our notice-pleading rules require pleadings to not only give notice of the claim and the relief sought but also of the essential factual allegations. The purpose of this rule is to give the opposing party information sufficient to enable him to prepare a defense. To paraphrase from Montelongo, providing only fair notice of claims does not provide fair notice of the essential factual allegations supporting those claims. **** Just as essential factual allegations may give rise to a variety of different legal theories, legal theories may be supported by a variety of different factual scenarios. The pleading of a legal theory, without more, does not provide notice of the facts that could be pleaded to support that theory.
Id. at 849–50 (internal citations and quotation marks omitted).
2. Filing of Amended Petition
Appellants initially contend that the filing of an amended petition alone
triggers a new dismissal deadline under the TCPA regardless of whether the claims
and factual allegations were previously pleaded.5 The sixty-day deadline to file a
TCPA motion is triggered by the filing of a “legal action,” which is defined to
include a “petition.” TEX. CIV. PRAC. & REM. CODE §§ 27.001(6), 27.003(b).
5 Appellants raised this argument in their original opening appellate brief, but they did not mention it again in their supplemental briefing upon remand from the Texas Supreme Court. Because the argument was not withdrawn, we briefly address it.
18 Although the statutory definition of “legal action” is broad, the Montelongo court
held that the filing of an amended or supplemental petition asserting the same “legal
action[s]” as prior petitions “does not trigger a new sixty-day period for filing a
dismissal motion.” 622 S.W.3d at 298; accord Kinder Morgan, 622 S.W.3d at 848.
Construing the TCPA otherwise “would render the Act’s deadlines meaningless.”
Montelongo, 622 S.W.3d at 298. Accordingly, we conclude that merely filing an
amended petition does not trigger a new sixty-day deadline to file a TCPA dismissal
motion.
3. New Causes of Action
Appellants also contend that the second amended petition added two new
causes of action: Count 6 for “Assisting or Encouraging Breaches of Fiduciary
Duties Against All Defendants” and Count 7 for “Assisting and Participating in
Breaches of Fiduciary Duties Against All Individual Defendants.” They argue that
these causes of action added an element not previously pleaded, specifically that the
assistance, encouragement, or participation was a substantial factor in the underlying
breach of fiduciary duty. The Sanchez parties respond that these claims were merely
split from or subsets of the prior cause of action entitled “Aiding and Abetting
Breaches of Fiduciary Duties Against All Defendants.” The Sanchez parties argue
that because this aiding-and-abetting cause of action requires substantial assistance
19 or participation, the later-pleaded claims did not include new elements and therefore
do not constitute new legal actions under the TCPA.
As stated above, Montelongo held that an amended or supplemental pleading
that asserts the same legal claims or theories by and against the same parties based
on the same essential facts previously alleged constitutes the same legal action and
does not trigger a new sixty-day period to file a TCPA dismissal motion. 622 S.W.3d
at 293. The court clarified, however, that an amended or supplemental pleading will
trigger a new sixty-day period to file a TCPA motion when the pleading (1) adds a
new party, triggering a new period as to claims asserted against the new party;
(2) alleges new essential facts to support previously asserted claims, triggering a new
period as to those new facts; or (3) asserts new legal claims or theories involving
different elements than the claims or theories previously asserted, triggering a new
period as to those new claims. Id. at 293–94. The court also noted that a “new claim
that does not involve different elements” or that “is merely a ‘subset’ of previously
filed claims” does not assert a new legal action. Id. at 301 (citations omitted).
The Sanchez parties’ earlier-pleaded claim entitled “Aiding and Abetting
Breaches of Fiduciary Duties Against All Defendants” alleged that:
(1) the individual appellants owed fiduciary duties to the Sanchez parties; (2) the individual appellants breached these fiduciary duties; (3) all appellants, including Terra, knew that the individual appellants owed such fiduciary duties; 20 (4) all appellants knowingly participated in the individual appellants’ breaches of their fiduciary duties; and (5) the breaches caused damages.
The second amended petition did not include this claim verbatim or a claim
titled as an aiding-and-abetting claim. Instead, this petition substituted two similarly
worded claims: Count 6 for assisting or encouraging breaches of fiduciary duties and
Count 7 for assisting and participating in breaches of fiduciary duties. The assisting-
or-encouraging claim—Count 6—alleged that:
(1) the individual appellants owed fiduciary duties to the Sanchez parties; (2) the individual appellants breached these fiduciary duties; (3) all appellants, including Terra, knew that the individual appellants owed such fiduciary duties; (4) all appellants knowingly and intentionally participated in the individual appellants’ breaches of their fiduciary duties “by providing assistance or encouragement”; (5) all appellants’ assistance or encouragement was a substantial factor in causing the breaches; and (6) the breaches caused damages.
The assisting-and-participating claim—Count 7—alleged that:
(1) the individual appellants owed fiduciary duties to the Sanchez parties; (2) the individual appellants breached these fiduciary duties; (3) Terra owed a statutory duty to the Sanchez parties; (4) Terra breached its statutory duty; (5) all appellants provided substantial assistance to the individual appellants’ breaches of their fiduciary duties;
21 (6) all appellants’ participation was a substantial factor in causing the breaches of fiduciary duties; and (7) the breaches caused damages.
Comparing the earlier-pleaded claim with the two later-pleaded claims reveals
the addition of an element in each of the two later claims that was not previously
pleaded. The assisting-or-encouraging claim added that the assistance or
encouragement was a substantial factor in causing the breaches of fiduciary duties.
The assisting-and-participating claim added that there was substantial assistance and
the participation was a substantial factor in causing the breaches of fiduciary duties.
Because these two later-pleaded claims include additional elements not previously
pleaded, we agree with appellants that they constitute new legal actions that trigger
a new TCPA dismissal deadline as to these new claims. See id. at 293–94.
The Sanchez parties argue, however, that a claim for aiding and abetting a
breach of fiduciary duty requires substantial assistance, and therefore the later-
pleaded claims did not involve different elements than the earlier-pleaded aiding-
and-abetting claim. Texas law does not currently recognize a cause of action for
aiding and abetting a tort, including a breach of fiduciary duty. See First United
Pentecostal Church of Beaumont v. Parker, 514 S.W.3d 214, 224 (Tex. 2017)
(noting that court “has not expressly decided whether Texas recognizes a cause of
action for aiding and abetting”); Nguyen v. Watts, 605 S.W.3d 761, 793 (Tex. App.—
Houston [1st Dist.] 2020, pet. denied) (discussing aiding-and-abetting claim “to the
22 extent it is an actionable tort in Texas”). Courts discussing this claim, however,
generally opine that it would require proof that the defendant’s conduct in assisting
or encouraging the primary tortfeasor was a substantial factor in causing the tort. See
Parker, 514 S.W.3d at 225 (recognizing that although court has never recognized
aiding-and-abetting claim, such claim nevertheless “requires evidence that the
defendant, with wrongful intent, substantially assisted and encouraged a tortfeasor
in a wrongful act that harmed the plaintiff”); Control & Applications LLC Houston
v. Abdallah, No. 01-20-00239-CV, 2022 WL 3650133, at *13 (Tex. App.—Houston
[1st Dist.] Aug. 25, 2022, no pet.) (mem. op.) (describing substantial assistance as
element of aiding-and-abetting liability); W. Fork Advisors, LLC v. SunGard
Consulting Servs., LLC, 437 S.W.3d 917, 921 (Tex. App.—Dallas 2014, pet. denied)
(stating that claims for aiding and abetting “require the actor, with unlawful intent,
to give substantial assistance and encouragement to a wrongdoer in a tortious act”).
The elements of a civil aiding-and-abetting claim, to the extent such a claim
is actionable in Texas, are: (1) the primary actor committed a tort; (2) the defendant
knew that the primary actor’s conduct constituted a tort; (3) the defendant intended
to assist the primary actor; (4) the defendant gave the primary actor assistance or
encouragement; and (5) the defendant’s conduct was a substantial factor in causing
the tort. Immobiliere Jeuness Establissement v. Amegy Bank Nat’l Ass’n, 525 S.W.3d
875, 882 (Tex. App.—Houston [14th Dist.] 2017, no pet.). We therefore agree with
23 the Sanchez parties that a civil aiding-and-abetting claim, to the extent it is viable in
Texas, requires proof of substantial assistance or encouragement in causing the tort.
The Sanchez parties did not, however, plead the substantial-factor element in
their earlier-pleaded aiding-and-abetting claim. Rather, that claim alleged only that
(1) the individual appellants owed the Sanchez parties fiduciary duties, which they
breached; (2) appellants knew the individual appellants owed such fiduciary duties;
(3) appellants knowingly participated in the individual appellants’ breaches of
fiduciary duties; and (4) the Sanchez parties suffered damages as a result of the
breaches.
The Sanchez parties argue that this “aiding and abetting” claim implied the
substantial-factor element. We disagree.
Courts prioritize substance over form when construing the claims asserted in
a petition. See, e.g., In re J.Z.P., 484 S.W.3d 924, 925 (Tex. 2016) (per curiam)
(emphasizing that “courts should acknowledge the substance of the relief sought
despite the formal styling of the pleading”) (citation omitted); State Bar of Tex. v.
Heard, 603 S.W.2d 829, 833 (Tex. 1980) (“We look to the substance of a plea for
relief to determine the nature of the pleading, not merely at the form of title given to
it.”); accord Brumley v. McDuff, 616 S.W.3d 826, 833 (Tex. 2021) (confirming that
“the substance of the plaintiff’s pleadings determines whether a claim sounds in
trespass to try title”). Although we liberally construe pleadings in the pleader’s favor,
24 a liberal construction “does not require a court to read into a petition what is plainly
not there.” Bos v. Smith, 556 S.W.3d 293, 306 (Tex. 2018) (citation omitted).
Despite being titled as an aiding-and-abetting claim, this earlier-pleaded claim
actually stated a claim for a related but distinct cause of action: knowing
participation in a breach of fiduciary duty. Texas law does recognize a knowing-
participation claim. Kinzbach Tool Co. v. Corbett-Wallace Corp., 160 S.W.2d 509,
514 (Tex. 1942) (“It is settled as the law of this State that where a third party
knowingly participates in the breach of duty of a fiduciary, such third party becomes
a joint tortfeasor with the fiduciary and is liable as such.”); Wooters v. Unitech Int’l,
Inc., 513 S.W.3d 754, 763 (Tex. App.—Houston [1st Dist.] 2017, pet. denied) (op.
on reh’g) (recognizing cause of action “in which a third party knowingly participates
in an employee’s breach of fiduciary duty during his employment and the third party
improperly benefits from it”). The elements of this claim are: (1) the existence of a
fiduciary duty owed by a third party to the plaintiff; (2) the defendant knew of the
fiduciary relationship; and (3) the defendant was aware of his participation in the
third party’s breach of its duty. Straehla v. AL Glob. Servs., LLC, 619 S.W.3d 795,
804 (Tex. App.—San Antonio 2020, pet. denied); Darocy v. Abildtrup, 345 S.W.3d
129, 137–38 (Tex. App.—Dallas 2011, no pet.). This is precisely what the Sanchez
parties’ earlier pleadings alleged: (1) the individual appellants owed fiduciary duties
to the Sanchez parties; (2) all appellants knew that the individual appellants owed
25 these fiduciary duties; (3) all appellants knowingly participated in the individual
appellants’ breaches of fiduciary duties; and (4) the breaches caused damage. See
Straehla, 619 S.W.3d at 804.
The omission of the substantial assistance element in the prior pleadings
differentiates an aiding-and-abetting claim from a knowing-participation claim. See
Bos, 556 S.W.3d at 306 (stating liberal construction of pleadings does not require
court to read into petition what is plainly not there). Construing the earlier pleadings
according to their substance rather than their form, as we must, we conclude that the
earlier pleadings stated a cause of action for knowing participation in breach of
fiduciary duty, not aiding and abetting breach of fiduciary duty. See In re J.Z.P., 484
S.W.3d at 925; Heard, 603 S.W.2d at 833.
Because the earlier pleadings stated a claim for knowing participation of
breach of fiduciary duty and did not plead the substantial-factor element, the addition
of this element in both Count 6 and Count 7 in the second amended petition stated
new legal actions under the TCPA. See Montelongo, 622 S.W.3d at 301 (“[A]n
amended or supplemental pleading that asserts a new claim involving different
elements than a previously asserted claim also asserts a new legal action that triggers
a new sixty-day period for filing a motion to dismiss that new claim.”). Therefore,
the amended TCPA motion was timely filed as to these two causes of action.
26 4. New Theory of Vicarious Liability
Appellants also contend that the second amended petition asserted a new legal
theory based on a new essential factual allegation: that Terra was vicariously liable
for all of Reynolds’ actions and Reynolds acted as “an officer” of Terra when he
allegedly stole the Sanchez parties’ trade secrets and other confidential information.
The Sanchez parties respond that vicarious liability is a derivative claim, not an
independent claim with different elements than the claims previously asserted.
Alternatively, assuming that vicarious liability can constitute a legal action under the
TCPA, the Sanchez parties argue that it is not a new legal action because Terra had
fair notice of this claim from allegations in the prior petitions that Reynolds acted
on behalf of and with the encouragement of Terra when misappropriating the trade
secrets and that all appellants—including Terra—were jointly and severally liable.6
The Montelongo court construed “cause of action” within the meaning of
“legal action” under the TCPA and held that “an amended or supplemental pleading
6 The Sanchez parties argue for the first time in their supplemental brief after remand that appellants have not explained how vicarious liability is based on the exercise of the right of free speech, right to petition, or right of association such that the TCPA applies. See TEX. CIV. PRAC. & REM. CODE § 27.003(a). The Sanchez parties did not dispute this part of the TCPA framework in either the trial court or in their original briefing on appeal. We will not consider this argument raised for the first time in a supplemental brief. See Hercules Offshore, Inc. v. Excell Crane & Hydraulics, Inc., 454 S.W.3d 70, 78 (Tex. App.—Houston [1st Dist.] 2014, pet. dism’d) (declining to consider arguments raised for first time in supplemental brief on appeal).
27 that asserts a new claim involving different elements than a previously asserted claim
also asserts a new legal action that triggers a new sixty-day period for filing a motion
to dismiss that new claim.” Id. The court noted, however, that a new claim that does
not involve different elements or that is merely a subset of previously filed claims
does not assert a new legal action. Id.
Respondeat superior, or vicarious liability, is a common-law doctrine
providing that “liability for one person’s fault may be imputed to another who is
himself entirely without fault solely because of the relationship between them.”
Painter v. Amerimex Drilling I, Ltd., 561 S.W.3d 125, 130 (Tex. 2018) (quoting St.
Joseph Hosp. v. Wolff, 94 S.W.3d 513, 540 (Tex. 2002) (plurality op.)). This doctrine
is an exception to the general rule that a person has no duty to control another
person’s conduct. Id. The Texas Supreme Court has “long recognized the employer-
employee relationship” as one such relationship imputing to the employer vicarious
liability for an employee’s fault. Id. at 131. Under the doctrine, an employer can be
liable for a worker’s negligent acts if, at the time of the acts, the worker was (1) an
employee and (2) acting in the course and scope of his employment. Id.
Vicarious liability is a derivative theory, meaning that an employer’s liability
for its employee’s tortious activity depends upon the employee’s liability for the
underlying tort. Nettles v. GTECH Corp., 606 S.W.3d 726, 738 (Tex. 2020) (stating
that theories of derivative or vicarious liability are “liability-spreading theories [that]
28 depend upon liability for an underlying tort, and they survive or fail alongside that
tort”); Magee v. G & H Towing Co., 388 S.W.3d 711, 714 (Tex. App.—Houston [1st
Dist.] 2012, no pet.) (stating that “an employer cannot be vicariously liable in tort
when its agent or employee has not engaged in tortious conduct”). In the context of
civil conspiracy, the Texas Supreme Court has explained that vicarious liability is
“a kind of cause of action” even if it is not an independent tort:
A cause of action is simply “a factual situation that entitles one person to obtain a remedy.” . . . When used as a theory of vicarious liability, civil conspiracy is part of the factual situation that permits a remedy against co-conspirators. Without it, there would be no grounds for recovery against co-conspirators who did not commit the underlying unlawful act. So it is not inconsistent to say civil conspiracy is a vicarious liability theory while also recognizing that it is a kind of cause of action. Indeed, it is not uncommon for courts to characterize vicarious liability itself as a cause of action when sorting through plaintiffs’ various claims. None would take this usage to mean vicarious liability is an independent cause of action.
Agar Corp. v. Electro Circuits Int’l, LLC, 580 S.W.3d 136, 141 (Tex. 2019) (internal
citations omitted).
Neither the Texas Supreme Court nor this Court has addressed whether
vicarious liability or respondeat superior constitutes a “legal action” under the
TCPA. The TCPA definition of “legal action” is “undeniably broad.” Montelongo,
622 S.W.3d at 296 (citation and internal quotation marks omitted). This broad
definition “evidences a legislative intent to treat any claim by any party on an
individual and separate basis.” Judwin Props. Inc. v. Lewis, 615 S.W.3d 338, 343
29 (Tex. App.—Houston [14th Dist.] 2020, no pet.) (quoting Better Bus. Bureau of
Metro. Dallas, Inc. v. Ward, 401 S.W.3d 440, 443 (Tex. App.—Dallas 2013, pet.
denied)). Indeed, to establish vicarious liability, a plaintiff is required to prove not
only the underlying tortious activity but also that the tortfeasor was an employee
acting in the course and scope of his employment at the time the tortious activity
occurred. Painter, 561 S.W.3d at 131. In this case, however, we need not resolve the
issue because even if we assume that respondeat superior constitutes a separate legal
action under the TCPA, we conclude that the claim was not new in the second
amended petition.
Montelongo disapproved sole reliance on pleading standards when
considering whether an amended or supplemental petition asserts a legal action
within the meaning of the TCPA. 622 S.W.3d at 300. Rather, the court looked to the
TCPA’s language in determining that, to assert a “cause of action” within the
meaning of a “legal action,” “the pleading must be sufficient to enable a court to
determine, with reasonable certainty, not just the facts, but ‘the elements of the cause
of action and the relief sought with sufficient information upon which to base a
judgment.’” Id. at 300–01 (quoting Stoner v. Thompson, 578 S.W.2d 679, 683 (Tex.
1979)) (alterations omitted). The issue, therefore, is whether the Sanchez parties’
prior petitions are sufficient to enable the court to determine with reasonable
30 certainty the facts and elements of their theory of vicarious liability against Terra
with sufficient information upon which to base a judgment. See id.
The Sanchez parties’ prior pleadings did not use the terms “vicarious liability”
or “respondeat superior.” Terra argues that the prior petitions only alleged that
Reynolds was working “on behalf of” Terra, which is insufficient to support a claim
for vicarious liability. However, the prior petitions provided significantly more detail
than this. These earlier petitions alleged that Terra was a newly created start-up
company doing business as a direct competitor of the Sanchez parties, and Terra
solicited Reynolds for employment and hired him as a vice president of operations.
The day after accepting employment at Terra, Reynolds allegedly stole the first batch
of trade secrets and other confidential information from the Sanchez parties. The
prior petitions alleged that Terra “hired Reynolds to gain access to this Sanchez
information.”
After he was hired, Reynolds allegedly provided input to Terra’s bidding and
acquisition of gas assets by using the trade secrets and other information that he took
from the Sanchez parties. In one instance, Terra competed against Sanchez in
bidding on an asset and, although neither party won the bid, “Terra significantly
enhanced Terra’s bid and its odds of success [by] utilizing Sanchez’s trade secret
information.” Terra and Reynolds allegedly used the Sanchez parties’ trade secrets
and other information “to identify, model, and bid on” other assets. The Sanchez
31 parties alleged that their “stolen information was a readymade template for
[appellants] to successfully acquire and develop this asset, which is precisely what
Terra and Reynolds used Sanchez’s information to do.” Finally, the prior pleadings
alleged that Reynolds solicited other Sanchez employees for employment at Terra.
Reynolds eventually succeeded in recruiting Hobbs and Mewshaw, and the two latter
individual appellants also allegedly took the Sanchez parties’ trade secrets and other
confidential information with them to Terra. Each of the causes of action in the prior
petitions incorporated these allegations by reference.
The prior petitions thus alleged that Terra recruited and hired the individual
appellants for the purpose of taking the Sanchez parties’ trade secrets and other
confidential information on Terra’s behalf, and appellants used the trade secrets and
confidential information to benefit Terra’s new business. See Painter, 561 S.W.3d
at 131 (stating that employee acts within course and scope of employment if act is
within scope of employee’s general authority, in furtherance of employer’s business,
and for accomplishment of object for which employee was hired). These facts allege
that, at the time of their allegedly tortious conduct, the individual appellants were
employed by Terra and acted within the course and scope of their employment.
These facts are sufficient to allege vicarious liability. See id. at 130.
In the misappropriation of trade secrets cause of action, for example, the
Sanchez parties alleged that all appellants misappropriated trade secrets not just by
32 using and disclosing the information without the Sanchez parties’ consent, but also
by acquiring the information by improper means. See TEX. CIV. PRAC. & REM. CODE
§ 134A.002(3) (defining “[m]isappropriation” of trade secrets as either “(A)
acquisition of a trade secret of another by a person who knows or has reason to know
that the trade secret was acquired by improper means; or (B) disclosure or use of a
trade secret of another without express or implied consent . . . .”). This trade secret
misappropriation claim is the basis for most of the Sanchez parties’ other claims,
including the claim that Terra knowingly participated in the individual appellants’
breaches of their fiduciary duties by misappropriating trade secrets.
The prior pleadings therefore alleged that Terra was directly liable for using
or disclosing the trade secrets and that Terra was vicariously liable for the individual
appellants’ actions in improperly acquiring, using, and disclosing the trade secrets.
The prior petitions are sufficient to enable us to determine with reasonable certainty
the facts and elements of the vicarious liability theory asserted against Terra with
sufficient information upon which to base a judgment. See Montelongo, 622 S.W.3d
at 300.
Terra also argues that the vicarious liability theory is based on a new essential
fact—that Reynolds acted as “an officer” of Terra when he allegedly copied the
Sanchez parties’ trade secrets and other information. We disagree.
33 The Kinder Morgan court held that adding new essential facts to support
previously alleged claims constitutes a new legal action that triggers a new sixty-day
dismissal period under the TCPA as to the new essential facts. 622 S.W.3d at 848
(applying Montelongo, 622 S.W.3d at 293–94).
The second amended petition added that Reynolds acted on behalf of and as
“an officer” of Terra when he allegedly stole the Sanchez parties’ trade secrets and
other confidential information. The earlier petitions, however, alleged that Terra
hired Reynolds as a vice president and, after hiring him, Reynolds “act[ed] on behalf
of” Terra when he allegedly took the trade secrets and other information from the
Sanchez parties. The essential factual allegation supporting the Sanchez parties’
theory of vicarious liability against Terra is that Reynolds was Terra’s employee and
was acting in the course and scope of his employment with Terra when he engaged
in the allegedly tortious activity. See Painter, 561 S.W.3d at 131. Considering that
Reynolds was previously identified as a Terra vice president, the additional language
stating that Reynolds acted as an officer of Terra is not a new essential factual
allegation. We therefore conclude that the theory of vicarious liability asserted in the
second amended petition against Terra for Reynolds’ actions was the same legal
theory previously asserted against Terra. Therefore, the TCPA motion was untimely
as to this theory.
34 5. New Theory of Concerted Action
Appellants finally contend that the second amended petition added allegations
of a massive scheme between appellants to assist in the alleged misappropriation of
trade secrets.7 Specifically, appellants argue that the second amended petition added
allegations that appellants “met and conversed,” discussed” their plans, and were “in
regular contact.” They also argue that this petition added language stating that
appellants had a “meeting of the minds,” “were members of a combination of
persons,” and that the “object of the combination was to accomplish the unlawful
purpose of misappropriating Sanchez’s trade secrets.”
Appellants argue that the prior pleadings only alleged direct liability for each
appellant’s tortious activity rather than “coordinated action between all [appellants]
to steal trade secrets.” We disagree. As discussed above, the prior pleadings alleged
that the newly created Terra solicited employees from its “direct competitor,” the
Sanchez parties. Terra eventually hired Reynolds as a vice president and encouraged
him to take the trade secrets and other confidential information from the Sanchez
parties. Reynolds did so, and Terra and Reynolds used the Sanchez parties’ trade
secrets and other confidential information to bid on and acquire gas assets in
7 Terra raised this argument in its original opening appellate brief, but it did not mention it again in its supplemental briefing upon remand from the Texas Supreme Court. Because the argument was not withdrawn, we briefly address it.
35 competition with Sanchez. The prior pleadings also alleged that “Reynolds began
targeting and soliciting” other Sanchez employees, including Mewshaw and Hobbs.
“Terra recruited Hobbs to further its scheme to misappropriate Sanchez’s trade
secret, confidential, and proprietary information.” Like Reynolds, Mewshaw and
Hobbs also allegedly misappropriated trade secrets by copying the Sanchez parties’
information onto hard drives and emailing the information to themselves to use in
furtherance of their new employer’s business. The crux of these allegations—
described as a “scheme” in the earlier pleadings—is coordinated action between
Terra and the individual appellants to misappropriate trade secrets.
Thus, the additional language in the second amended petition did not
constitute new essential factual allegations concerning concerted action among the
appellants to misappropriate trade secrets and other confidential information from
the Sanchez parties. We conclude that the Sanchez parties did not plead a new theory
of concerted action in the second amended petition, and therefore the appellants’
TCPA motion was untimely as to this theory.
****
In sum, the amended TCPA motion was timely as to Count 6 for assisting or
encouraging breaches of fiduciary duties and Count 7 for assisting and participating
in breaches of fiduciary duties. The amended TCPA motion was otherwise untimely.
We sustain in part and overrule in part Terra’s first issue.
36 C. Merits of TCPA Dismissal Motion
In their second issue, appellants argue that the Sanchez parties did not meet
their burden to establish by clear and specific evidence a prima facie case for each
essential element of the challenged claims. We consider only the claims that were
timely challenged: Count 6 for assisting or encouraging breaches of fiduciary duties
and Count 7 for assisting and participating in breaches of fiduciary duties. See TEX.
CIV. PRAC. & REM. CODE § 27.005(c). In their third issue, appellants argue that even
if the Sanchez parties established a prima facie case for each claim, appellants
established two defenses to these causes of action: (1) the claims are preempted, and
(2) the claims are not legally cognizable.
Counts 6 and 7 are both premised on two separate categories of underlying
misconduct: misappropriation of trade secrets and Mewshaw’s improper solicitation
of Sanchez employees. As we discuss below, we agree with appellants that Counts
6 and 7 are preempted by the Texas Uniform Trade Secrets Act to the extent these
claims are based on misappropriation of trade secrets. However, to the extent these
two claims are based on Mewshaw’s solicitation of employees, we conclude that the
Sanchez parties met their burden to establish a prima facie case and appellants did
not meet their burden to establish a defense to the claims.
37 1. TCPA Framework
The TCPA provides a three-step decisional process to determine whether
dismissal is appropriate. Creative Oil & Gas, LLC v. Lona Hills Ranch, LLC, 591
S.W.3d 127, 132 (Tex. 2019); Gaskamp, 596 S.W.3d at 469; see also TEX. CIV.
PRAC. & REM. CODE §§ 27.003(a), 27.005(b)–(d). Under the first step, a movant must
show by a preponderance of the evidence that the TCPA applies. See TEX. CIV. PRAC.
& REM. CODE § 27.005(b) (requiring movant to prove by preponderance of evidence
that legal action is based on, relates to, or is in response to party’s exercise of right
of free speech, right to petition, or right of association); Gaskamp, 596 S.W.3d at
469–70. The Sanchez parties do not dispute that the TCPA applies to the challenged
claims. Accordingly, we assume without deciding that the TCPA applies in this case.
If the movant establishes that the TCPA applies to the challenged claims, then
the burden shifts to the nonmovant to establish “by clear and specific evidence a
prima facie case for each essential element of the claim in question.” TEX. CIV. PRAC.
& REM. CODE § 27.005(c); Gaskamp, 596 S.W.3d at 470; see In re Lipsky, 460
S.W.3d at 587 (stating that “clear” means unambiguous, sure, or free from doubt;
“specific” means explicit or relating to particular named thing; and “prima facie
case” is “minimum quantum of evidence necessary to support a rational inference
that the allegation of fact is true”) (citations omitted). If the nonmovant does not
satisfy this burden, then the trial court must dismiss the claim. TEX. CIV. PRAC. &
38 REM. CODE § 27.005(b), (c). If the nonmovant satisfies this burden, then the burden
switches back to the movant to establish “by a preponderance of the evidence each
essential element of a valid defense to the nonmovant’s claim.” Id. § 27.005(d); see
Gaskamp, 596 S.W.3d at 470.
2. Mewshaw’s Alleged Solicitation of Sanchez Employees
We first consider whether the Sanchez parties established a prima facie case
on Counts 6 and 7 to the extent these counts are based on Mewshaw’s solicitation of
Sanchez employees. See TEX. CIV. PRAC. & REM. CODE § 27.005(c); Gaskamp, 596
S.W.3d at 470. These claims alleged that Mewshaw owed the Sanchez parties a
fiduciary duty not to solicit Sanchez employees, he breached this duty, and
appellants knowingly and substantially assisted, encouraged, or participated in this
breach. On appeal, the individual appellants contend that no evidence shows that
Mewshaw solicited employees while still employed by the Sanchez parties. We
disagree.
In support of their response to the amended TCPA motion, the Sanchez parties
attached an affidavit from a Sanchez employee who averred that she had
conversations with Mewshaw in his office in February 2016 “while he was still
employed at Sanchez.” According to the employee, shortly after Terra announced a
recent acquisition, Mewshaw told the employee that “he nearly had a deal finalized
to leave Sanchez and join Terra and work with B.J. Reynolds.” Mewshaw expressed
39 dissatisfaction with Sanchez, and “had several short conversations with me [the
employee] about the possibility of joining him at Terra. I felt that Mr. Mewshaw was
probing to see what my interest level was in transitioning to a completions role under
him at Terra.” See Wooters, 513 S.W.3d at 762–63 (stating that “[a]n employee has
a duty to act primarily for the benefit of his employer in matters connected with his
employment,” and employee may not “solicit the departure of other employees while
still working for his employer”).
This affidavit constitutes clear and specific evidence that Mewshaw, while
still employed by Sanchez, solicited Sanchez employees to leave their employment
and go work for Terra. See TEX. CIV. PRAC. & REM. CODE §§ 27.005(c), 27.006(a)
(providing that court determining whether to dismiss under TCPA shall consider
supporting and opposing affidavits); In re Lipsky, 460 S.W.3d at 590 (stating that
“clear” means unambiguous, sure, or free from doubt; “specific” means explicit or
relating to particular named thing; and “prima facie case” is “minimum quantum of
evidence necessary to support a rational inference that the allegation of fact is true”)
(citations omitted). Because there is evidence that Mewshaw solicited employees
from the Sanchez parties while still employed there, we disagree with appellants that
the Sanchez parties did not establish by clear and specific evidence a prima facie
case of Counts 6 and 7 to the extent they are based on Mewshaw’s solicitation of
employees.
40 3. TUTSA Preemption
Appellants contend that dismissal under the TCPA is appropriate because they
demonstrated that Counts 6 and 7 are preempted by the Texas Uniform Trade Secrets
Act (“TUTSA”).8 See TEX. CIV. PRAC. & REM. CODE §§ 134A.001–.008. To the
extent these causes of action are based on misappropriation of trade secrets—as
opposed to Mewshaw’s solicitation of employees—we agree that they are preempted
by TUTSA. Accordingly, our analysis assumes without deciding that the Sanchez
parties established a prima facie case for these causes of action to the extent they are
based on misappropriation of trade secrets. See TEX. CIV. PRAC. & REM. CODE
§ 27.005(d); Gaskamp, 596 S.W.3d at 470.
Whether a common law cause of action is preempted by a statutory remedy is
a question of law that we review de novo. Title Source, Inc. v. HouseCanary, Inc.,
612 S.W.3d 517, 532 (Tex. App.—San Antonio 2020, pet. denied). TUTSA
“displaces conflicting tort, restitutionary, and other law of this state providing civil
remedies for misappropriation of a trade secret.” TEX. CIV. PRAC. & REM. CODE
§ 134A.007(a). TUTSA does not preempt contractual remedies, whether or not
8 In 2017, the Texas Legislature amended several provisions of TUTSA, and the amendments became effective on September 1, 2017, and apply to an action commencing after this date. Act of May 8, 2017, 85th Leg., R.S., ch. 37, §§ 1–7, secs. 134A.002–.006, 2017 Tex. Gen. Laws 92, 92–94. This lawsuit was filed before September 1, 2017, and it is therefore governed by the pre-amendment version of the statute. See id. All citations to TUTSA in this opinion are to the pre-amendment version of the statute.
41 based upon misappropriation of trade secrets, or other civil remedies that are not
based upon misappropriation of trade secrets. Id. § 134A.007(b)(1)–(2).
Our objective in construing TUTSA is to ascertain and give effect to the
Legislature’s intent as expressed in the statute’s language. Youngkin, 546 S.W.3d at
680. We construe a statute’s terms “according to their plain and common meaning,
unless a contrary intention is apparent from the context, or unless such a construction
leads to absurd results.” Id. (quoting Hughes, 246 S.W.3d at 625–26). We must
consider the specific statutory language at issue and the statute as a whole. Id.; In re
Off. of Att’y Gen., 422 S.W.3d at 629. We endeavor to read the statute contextually,
giving effect to every word, clause, and sentence. In re Off. of Att’y Gen., 422 S.W.3d
at 629.
Our sister courts have concluded that a common law claim is preempted by
TUTSA when the gravamen of the claim duplicates a TUTSA claim. Title Source,
612 S.W.3d at 533; Super Starr Int’l, LLC v. Fresh Tex Produce, LLC, 531 S.W.3d
829, 843 (Tex. App.—Corpus Christi–Edinburg 2017, no pet.). A common law
claim duplicates a TUTSA claim “if the factual basis of the common law claim, as
pleaded, would not exist ‘without the use of alleged trade secrets.’” Title Source,
612 S.W.3d at 533 (quoting Super Starr Int’l, 531 S.W.3d at 843). “The plain
language of the preemption provision indicates that the law was intended to prevent
inconsistent theories of relief for the same underlying harm by eliminating
42 alternative theories of common law recovery which are premised on the
misappropriation of a trade secret.” Super Starr Int’l, 531 S.W.3d at 843 (quoting
Smithfield Ham & Prods. Co. v. Portion Pac, Inc., 905 F. Supp. 346, 348 (E.D. Va.
1995) (interpreting similar language in Virginia Uniform Trade Secrets Act)).
TUTSA preempts only conflicting common law remedies, but it does not preempt a
common law claim that addresses harm separate from the trade secret
misappropriation. TEX. CIV. PRAC. & REM. CODE § 134A.007(a), (b)(2); Title
Source, 612 S.W.3d at 533.
As discussed above, Counts 6 and 7 are primarily based on the individual
appellants’ misappropriation of trade secrets. These claims sound in tort and provide
remedies for the underlying misconduct of misappropriation of trade secrets. Under
the plain language of TUTSA, these claims conflict with civil remedies for
misappropriation of a trade secret. See TEX. CIV. PRAC. & REM. CODE § 134A.007(a).
To the extent these claims are based on misappropriation of trade secrets, the factual
basis of these claims duplicates and would not exist without the improper
acquisition, use, or disclosure of the Sanchez parties’ trade secrets and other
information. See id. § 134A.002(3) (defining “[m]isappropriation” to include either
improper acquisition of trade secret or disclosure or use of trade secret without
consent); Title Source, 612 S.W.3d at 533; Super Starr Int’l, 531 S.W.3d at 843. We
43 therefore conclude that TUTSA preempts these claims to the extent they are based
on appellants’ alleged misappropriation of trade secrets.
The Sanchez parties argue that TUTSA does not preempt these claims to the
extent they are based on confidential information that does not rise to the level of
trade secrets. The plain language of TUTSA preempts only “conflicting tort,
restitutionary, and other law of this state providing civil remedies for
misappropriation of a trade secret.” See TEX. CIV. PRAC. & REM. CODE
§ 134A.007(a). TUTSA defines “[t]rade secret” as information that derives
independent economic value from not being generally known or readily
ascertainable by proper means and is the subject of reasonable efforts to maintain its
secrecy. Id. § 134A.002(6). Under the plain language of TUTSA, therefore,
confidential information is not necessarily a trade secret.
As pleaded by the Sanchez parties, however, even the confidential and
proprietary information at issue in this case falls within TUTSA’s definition of a
trade secret. The Sanchez parties alleged that the files constituting their trade secrets
and confidential and proprietary information give them “a competitive advantage for
acquiring and operating oil and gas assets across the United States,” and “their value
is difficult to overstate,” particularly to a new startup competitor business like Terra.
Furthermore, the Sanchez parties alleged that they “employ[ed] various methods to
protect the secrecy of [their] trade secret, proprietary, and confidential information.”
44 See id. These allegations show that even the confidential and proprietary information
at issue in this case derives independent economic value from not being generally
known or readily ascertainable by proper means and is the subject of reasonable
efforts to maintain its secrecy. See id. Therefore, even the information alleged to be
confidential and proprietary falls within the statutory definition of “trade secret” and
is preempted by TUTSA. See id.
To the extent Counts 6 and 7 are based on Mewshaw’s solicitation of Sanchez
employees to work at Terra, however, these claims are not preempted by TUTSA.
Terra does not argue that these claims are based on misappropriation of trade secrets,
and the individual appellants concede on appeal that these claims are not based on
misappropriation of trade secrets. TUTSA expressly exempts from its application
“other civil remedies that are not based upon misappropriation of a trade secret.” Id.
§ 134A.007(b)(2).
4. Whether the Claims are Legally Cognizable
Appellants also argue that Counts 6 and 7 are not legally cognizable claims,
which they assert as a valid defense to these two claims. See id. § 27.005(d). They
further argue that to the extent the claims are legally cognizable under Texas law,
they apply only to “highly dangerous, deviant, or anti-social group activity,” which
is not present in this case. Because the only remaining claims at issue in this
45 challenge are those parts of Counts 6 and 7 based on Mewshaw’s solicitation of
Sanchez employees, we consider only whether these claims are legally cognizable.
The assisting-or-encouraging and assisting-and-participating claims track the
language in two of the three so-called concert-of-action theories of liability in section
876 of the Restatement (Second) of Torts. See RESTATEMENT (SECOND) OF TORTS
§ 876; Juhl v. Airington, 936 S.W.2d 640, 643 (Tex. 1996) (stating that concert-of-
action theory in Restatement section 876 “impos[es] liability on a person for the
conduct of another which causes harm” under certain circumstances). Relevant here,
subsections (b) and (c) provide that, “for harm resulting to a third person from the
tortious conduct of another, one is subject to liability if he”:
(b) knows that the other’s conduct constitutes a breach of duty and gives substantial assistance or encouragement to the other so to conduct himself; or
(c) gives substantial assistance to the other in accomplishing a tortious result and his own conduct, separately considered, constitutes a breach of duty to the third person.
RESTATEMENT (SECOND) OF TORTS § 876(b)–(c).
Neither the Texas Supreme Court nor this Court has recognized a cause of
action under section 876 or based on the liability theories presented in it. Juhl, 936
S.W.2d at 643 (“[W]hether such a theory of liability is recognized in Texas is an
open question.”); accord Parker, 514 S.W.3d at 224 (aiding and abetting); see also
Mark III Sys., Inc. v. Sysco Corp., No. 01-05-00488-CV, 2007 WL 529960, at *8
46 (Tex. App.—Houston [1st Dist.] Feb. 22, 2007, no pet.) (mem. op.) (declining to
recognize cause of action for participating in and assisting with misappropriation of
trade secrets). To the extent such a cause of action is viable, courts agree that the
purpose of section 876 is “to deter antisocial or dangerous behavior,” such as drag
racing on public streets. Juhl, 936 S.W.2d at 644–45; see Marshall v. Ribosome L.P.,
No. 01-18-00108-CV, 2019 WL 2041062, at *7 (Tex. App.—Houston [1st Dist.]
May 9, 2019, no pet.) (mem. op.).
Appellants had the burden to establish a valid defense to Counts 6 and 7 by a
preponderance of the evidence. See TEX. CIV. PRAC. & REM. CODE § 27.005(d).
Appellants have not cited any legal authority supporting their argument that it is a
defense under the TCPA framework that a claim has not been previously recognized
by Texas courts.
But assuming without deciding that appellants established such a defense,
these two challenged claims also state a cause of action for knowing participation in
breach of fiduciary duty, a claim that is cognizable under Texas law. See Kinzbach
Tool Co., 160 S.W.2d at 514; Wooters, 513 S.W.3d at 763. Both of the challenged
causes of action include the essential elements of and essential factual allegations
supporting a knowing-participation claim. Thus, even if the concert-of-action
theories in section 876 are not recognized under Texas law, the challenged claims
47 still assert the legally cognizable claims for knowing participation in breach of
fiduciary duty.
Moreover, we are aware of no authority limiting claims for knowing
participation in breach of fiduciary duty to dangerous, deviant, or anti-social group
activity. To the contrary, this Court has applied the cause of action to similar claims
involving misappropriation of trade secrets. See Wooters, 513 S.W.3d at 762–67.
Therefore, we conclude that appellants have not established that the challenged
claims are not legally cognizable. We overrule appellants’ second issue, and we
sustain in part and overrule in part appellants’ third issue.
D. Attorney’s Fees and Costs
1. The Sanchez Parties’ Attorney’s Fees
In their fourth issue, appellants challenge the trial court’s finding that their
amended TCPA motion was solely intended to delay the proceeding. The order
denying the amended TCPA motion found that the motion was “solely intended to
delay under Section 27.009(b)” of the TCPA, and it stated that the court would
“separately award court costs and reasonable attorney’s fees” to the Sanchez parties
under the TCPA.
Under section 27.009(b), the trial court “may award court costs and reasonable
attorney’s fees” to the party responding to a TCPA motion “[i]f the court finds that
a motion to dismiss filed under [the TCPA] is frivolous or solely intended to
48 delay[.]” TEX. CIV. PRAC. & REM. CODE § 27.009(b). We generally review a trial
court’s decision to award attorney’s fees for an abuse of discretion. Keane Frac, LP
v. SP Silica Sales, LLC, 608 S.W.3d 416, 432 (Tex. App.—Houston [1st Dist.] 2020,
no pet.). A trial court abuses its discretion if its decision is arbitrary, unreasonable,
or without reference to guiding rules or principles. ADB Int., LLC v. Wallace, 606
S.W.3d 413, 440 (Tex. App.—Houston [1st Dist.] 2020, pet. denied).
We have already determined that part of appellants’ amended TCPA motion
was meritorious. Although delay may have been a factor in appellants’ decision to
file the motion, the meritorious nature of the motion does “not support a reasonable
finding that delay was the only factor” in filing the motion. See Sullivan v. Tex.
Ethics Comm’n, 551 S.W.3d 848, 857–58 (Tex. App.—Austin 2018, pet. denied).
We therefore conclude that the trial court abused its discretion by finding that
appellants filed the amended TCPA motion solely for delay. We sustain appellants’
fourth issue.
2. Appellants’ Attorney’s Fees
Finally, in their fifth issue, appellants request that we remand for the trial court
to consider attorney’s fees under Civil Practice and Remedies Code section 27.009.
Terra and the individual appellants make similar but distinct requests. Terra argues
that it is entitled to fees under section 27.009 because it successfully moved for
dismissal of a legal action under the TCPA, and therefore it requests that this Court
49 remand to the trial court with instructions to award Terra its statutorily mandated
attorney’s fees. The individual appellants simply request a remand for the trial court
to consider in the first instance whether to award them attorney’s fees.
The Sanchez parties do not oppose the individual appellants’ request, but they
argue that Terra requested “more expansive relief” in its motion for rehearing than
in its original briefing. The Sanchez parties contend that Terra’s original briefing
only “asked this Court to remand the issue of fees so the trial court could consider,
in the first instance, whether Appellants are entitled to them.” The Sanchez parties
further argue that the law is not settled whether the dismissal of only part of a claim
under the TCPA entitles the movant to a mandatory fee award under section
27.009(a), and the issue should be resolved by the trial court. We disagree.
Section 27.009(a) provides that, “If the court orders dismissal of a legal action
under [the TCPA], the court shall award to the moving party: (1) court costs,
reasonable attorney’s fees, and other expenses incurred in defending against the legal
action as justice and equity may require . . . .” TEX. CIV. PRAC. & REM. CODE
§ 27.009(a)(1) (emphasis added). Section 27.009(a) does not condition attorney’s
fees on the dismissal of an entire claim, as opposed to dismissal of a “legal action”
as defined by the TCPA. Consequently, we remand to the trial court for further
proceedings consistent with this opinion and the requirements set forth in section
27.009(a), including but not limited to determining an award of attorney’s fees. See
50 Florez v. Olibas, 657 S.W.3d 31, 43 (Tex. App.—El Paso 2022, pet. denied). We
sustain appellants’ fifth issue.
Conclusion
We reverse the part of the trial court’s order denying dismissal under the
TCPA of Counts 6 and 7 in the second amended petition to the extent these causes
of action are based on misappropriation of trade secrets, and we render judgment
dismissing those parts of Counts 6 and 7. To the extent Counts 6 and 7 are based on
Mewshaw’s solicitation of Sanchez employees, however, the trial court properly
denied the amended TCPA motion. We further reverse the trial court’s finding that
the filing of the amended TCPA motion was solely intended to delay, and we render
judgment denying the Sanchez parties’ request for attorney’s fees under Civil
Practice and Remedies Code section 27.009(b). We further reverse the trial court’s
implicit denial of appellants’ attorney’s fees under Civil Practice and Remedies
Code section 27.009(a), and we remand to the trial court for further proceedings
consistent with this opinion and the requirements set forth in section 27.009(a),
including but not limited to determining an award of attorney’s fees. We affirm the
remainder of the trial court’s order.
April L. Farris Justice
Panel consists of Justices Goodman, Countiss, and Farris. 51
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Cite This Page — Counsel Stack
Benajmin "B.J." Reynolds, Mark Mewshaw and Wes Hobbs and Terra Energy Partners LLC v. Sanchez Oil & Gas Corporation, Counsel Stack Legal Research, https://law.counselstack.com/opinion/benajmin-bj-reynolds-mark-mewshaw-and-wes-hobbs-and-terra-energy-texapp-2023.