Blue Gold Energy Barstow, LLC West Texas Water Solutions, LLC Trinity Crawford Chad Carson Donnie Seburg And Kalee VanMeter v. Precision Frac, LLC Jared Davis And James Brian Hillman

CourtCourt of Appeals of Texas
DecidedApril 9, 2020
Docket11-19-00238-CV
StatusPublished

This text of Blue Gold Energy Barstow, LLC West Texas Water Solutions, LLC Trinity Crawford Chad Carson Donnie Seburg And Kalee VanMeter v. Precision Frac, LLC Jared Davis And James Brian Hillman (Blue Gold Energy Barstow, LLC West Texas Water Solutions, LLC Trinity Crawford Chad Carson Donnie Seburg And Kalee VanMeter v. Precision Frac, LLC Jared Davis And James Brian Hillman) 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.

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Blue Gold Energy Barstow, LLC West Texas Water Solutions, LLC Trinity Crawford Chad Carson Donnie Seburg And Kalee VanMeter v. Precision Frac, LLC Jared Davis And James Brian Hillman, (Tex. Ct. App. 2020).

Opinion

Opinion filed April 9, 2020

In The

Eleventh Court of Appeals __________

No. 11-19-00238-CV __________

BLUE GOLD ENERGY BARSTOW, LLC; WEST TEXAS WATER SOLUTIONS, LLC; TRINITY CRAWFORD; CHAD CARSON; DONNIE SEBURG; AND KALEE VANMETER, Appellants/Cross-Appellees V. PRECISION FRAC, LLC; JARED DAVIS; AND JAMES BRIAN HILLMAN, Appellees/Cross-Appellants

On Appeal from the 142nd District Court Midland County, Texas Trial Court Cause No. CV55095

MEMORANDUM OPINION Jared Davis, Trinity Crawford, and Chad Carson were members of Precision Frac, LLC. Donnie Seburg and Kalee VanMeter worked for Precision Frac. The relationship between Davis, Crawford, and Carson deteriorated, and Seburg and VanMeter sided with Crawford and Carson. This appeal arises from the second round of litigation between the parties. Appellees sued Appellants for breach of contract; breach of fiduciary duty; knowing participation in breach of fiduciary duty; conspiracy to use Precision Frac’s confidential, proprietary, and trade secret information; and unjust enrichment. Appellants moved to dismiss Appellees’ claims pursuant to the Texas Citizens Participation Act, TEX. CIV. PRAC. & REM. CODE ANN. §§ 27.001–.011 (West 2015) (the TCPA).1 The trial court denied the motion. In four issues, Appellants assert that the trial court erred when it denied the motion to dismiss because Appellees’ claims are based on, related to, or in response to Appellants’ exercise of the right to petition, the right of association, and the right of free speech and because Appellees failed to produce clear and specific evidence to establish a prima facie case for each essential element of their claims. Appellees filed a motion to dismiss this appeal for lack of jurisdiction and a cross-appeal in which they complain that the trial court erred when it found good cause to extend the time for Appellants to file the motion to dismiss and when it failed to find that the motion to dismiss was frivolous or solely intended to delay. We affirm the trial court’s order because Appellants failed to establish that the TCPA applies to Appellees’ claims. Background Davis, Carson, and Crawford were members of Precision Frac. Seburg and VanMeter were both employed by Precision Frac. Appellees allege that Carson, Crawford, Seburg, and VanMeter signed agreements not to compete with Precision Frac and not to disclose Precision Frac’s confidential information.

1 The Texas legislature amended the TCPA effective September 1, 2019. See Act of May 17, 2019, 86th Leg., R.S., ch. 378, §§ 1–9, 12 (H.B. 2730) (codified at TEX. CIV. PRAC. & REM. CODE ANN. §§ 27.001, .003, .005–.007, .0075, .009–.010). Because the underlying lawsuit was filed prior to September 1, 2019, the law in effect before September 1 applies. See id. §§ 11–12. For convenience, all citations to the TCPA in this opinion are to the version of the statute prior to September 1, 2019. See Act of May 21, 2011, 82d Leg., R.S., ch. 341, § 2, 2011 Tex. Gen. Laws 961–64, amended by Act of May 24, 2013, 83d Leg., R.S., ch. 1042, 2013 Tex. Gen. Laws 2499–2500. 2 Pursuant to a written contract, J. Michael Evans and Clarabby Holdings, LLC agreed that Blue Gold Energy Barstow, LLC (BGEB) could produce and sell water from Evans and Clarabby’s land in Ward County (the Property). Davis, as BGEB’s CEO, signed the contract on October 31, 2017. BGEB did not exist at the time that Davis signed the contract. Appellees allege that Davis instructed Seburg and VanMeter to form BGEB as an affiliate of Precision Frac. Carson, Crawford, Seburg, and VanMeter formed BGEB on June 29, 2018. Davis was not included as a member in BGEB. Crawford and Carson, individually and on behalf of Precision Frac and other companies, also sued Davis in Cause No. CV54756 for the misappropriation of company funds. Davis responded with a number of claims based generally on the theories that Carson, Crawford, Seburg, and VanMeter had defamed him and attempted to deprive him of business opportunities. Carson, Crawford, Seburg, and VanMeter filed a TCPA motion to dismiss some, but not all, of Davis’s claims. On September 7, 2018, Seburg, as the operations manager for BGEB, signed a contract with JLG Aqua, LLC2 and Clarabby that gave BGEB the right to produce and sell water from the Property. Crawford, Seburg, and VanMeter formed West Texas Water Solutions, LLC (WTWS) on September 27, 2018. On November 5, 2018, the trial court granted, in part, Carson, Crawford, Seburg, and VanMeter’s motion to dismiss in Cause No. CV54756. Specifically, the trial court denied the motion to dismiss as to Davis’s claims for wrongful injunction, tortious interference with contract, and tortious interference with business relations. On November 6, 2018, Carson, Crawford, Seburg, and VanMeter appealed the trial court’s partial denial of the motion to dismiss, and all trial-court proceedings in Cause No. CV54756 were stayed pending resolution of that appeal. CIV. PRAC. & REM. § 51.014(a)(12), (b) (West Supp. 2019).

2 The contract identified J. Michael Evans as the managing member of JLG Aqua, LLC. 3 Appellees filed this case on November 13, 2018. Appellees alleged that Crawford, Carson, Seburg, and VanMeter (1) had signed confidentiality and noncompete agreements with Precision Frac, (2) waited to form BGEB until they no longer worked for Precision Frac, (3) did not include Davis as a member of BGEB in an attempt to steal the water agreement from Davis and to compete with Precision Frac, and (4) formed WTWS to compete with Precision Frac. Appellees also alleged that James Brian Hillman provided services to Precision Frac related to the water agreement, that Davis agreed that Hillman would be paid 5% of the water sales for his services, that VanMeter worked closely with Hillman on the water agreement, and that Hillman had not received the promised payment. Appellees asserted causes of action against Crawford, Carson, Seburg, and VanMeter for breach of the confidentiality and noncompete agreements, breach of fiduciary duty as to Precision Frac and Davis, and breach of fiduciary duty and knowing participation in breach of fiduciary duty as to Hillman. Appellees asserted claims against all Appellants for conspiracy to use Precision Frac’s confidential, proprietary, and trade secret information to compete with Precision Frac and for unjust enrichment. Finally, Appellees alleged that BGEB and WTWS were alter egos of each other and of Crawford, Carson, Seburg, and VanMeter and were being used to perpetuate a fraud and commit wrongful acts. Appellees sought both damages and injunctive relief. The trial court heard Appellees’ request for a temporary injunction on December 12, 2018. The trial court found that the issues in this case were intertwined with the issues in Cause No. CV54756 and that it could not move forward on the requested injunctive relief in this case without potentially violating the automatic stay in Cause No. CV54756. The trial court stayed the proceedings in this case pending the outcome of the interlocutory appeal in Cause No. CV54756.

4 In that interlocutory appeal, Davis asserted that he was being harmed by the automatic stay of the trial-court proceedings and requested to withdraw the contested claims so that litigation could proceed in the trial court. Crawford v. Davis, No. 11- 18-00306-CV, 2019 WL 2147727, at *2 (Tex. App.—Eastland May 16, 2019, no pet.) (mem. op.). Based on the “unusual circumstance” that both parties requested that Davis’s claims be dismissed, we reversed the trial court’s order to the extent that it partially denied the motion to dismiss and rendered judgment that Davis’s claims for wrongful injunction, tortious interference with contract, and tortious interference with business relations were dismissed with prejudice. Id. We issued our opinion in Crawford on May 16, 2019.

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Blue Gold Energy Barstow, LLC West Texas Water Solutions, LLC Trinity Crawford Chad Carson Donnie Seburg And Kalee VanMeter v. Precision Frac, LLC Jared Davis And James Brian Hillman, Counsel Stack Legal Research, https://law.counselstack.com/opinion/blue-gold-energy-barstow-llc-west-texas-water-solutions-llc-trinity-texapp-2020.