Bradley B. Miller v. Talley Dunn Gallery, LLC and Talley Dunn
Opinion
ACCEPTED 05-15-00444-CV FIFTH COURT OF APPEALS DALLAS, TEXAS 8/3/2015 4:42:36 PM LISA MATZ CLERK
CASE NO. 05-15-00444-CV __________________________________________________________________ FILED IN 5th COURT OF APPEALS In the Court of Appeals DALLAS, TEXAS for the Fifth District of Texas 8/3/2015 4:42:36 PM Dallas, Texas LISA MATZ Clerk __________________________________________________________________
BRADLEY B. MILLER Appellant,
v.
TALLEY DUNN GALLERY, LLC AND TALLEY DUNN Appellees.
__________________________________________________________________
Interlocutory Appeal from the 191st District Court, Dallas County, Texas
__________________________________________________________________
BRIEF OF APPELLEES TALLEY DUNN GALLERY, LLC AND TALLEY DUNN
__________________________________________________________________
Dan Hartsfield State Bar No. 09170800 Talley Parker State Bar No. 2406065872 Jackson Lewis P.C. 500 North Akard, Suite 2500 Dallas, TX 75201 Tel 214 520-2400 Fax 214 520- 2008
ATTORNEYS FOR APPELLEES
i TABLE OF CONTENTS
I. STATEMENT OF THE CASE .............................................................................. 8
II. STATEMENT REGARDING ORAL ARGUMENT ........................................... 8
III. ISSUES PRESENTED......................................................................................... 8
IV. STATEMENT OF FACTS .................................................................................. 9
V. PROCEDURAL BACKGROUND ..................................................................... 20
VI. SUMMARY OF ARGUMENT ......................................................................... 20
VII. ARGUMENT ................................................................................................... 21
A. The District Court Properly Entered A Temporary Injunction Against Appellant .......................................................................................... 21
1. ISSUE 1: Injunction No. 7 is Not an Unlawful Prior Restraint of Speech.............................................................................. 22
2. ISSUE 2: The Temporary Injunction Complies with Tex. R. Civ. P. 683 .............................................................................. 26
3. ISSUE 3: Appellees Offered Evidence of Irreparable Harm and No Adequate Remedy at Law....................................................... 28
4. ISSUE 4: Appellees Offered Evidence Establishing a Probably Right to Recover .................................................................................. 32
a. Misappropriation and/or Disclosure of Trade Secrets .............. 33
b. Tortious Interference with Business Relations ......................... 37
1) The Evidence Confirms Appellant’s Tortious Interference with Existing Relationships ......................... 37
2) The Evidence Confirms Appellant’s Tortious Interference with Prospective Relationships ................... 42
1 c. Harmful Access by Computer Violation .................................. 45
d. Texas Wiretapping Violation .................................................... 46
e. Defamation and Business Disparagement ................................ 46
f. Invasion of Privacy ................................................................... 48
B. The District Court’s Award of Attorneys’ Fees For Appellant’s Motion to Dismiss Should Not Be Set Aside ................................................ 50
1. ISSUE 5: The Trial Court Did Not Abuse its Discretion When It Determined that Plaintiff’s Motion was Frivolous and Awarded Fees ...................................................................................... 50
2. Appellant Waved Any Right to Appeal the Order Denying The Motion to Dismiss ........................................................................ 53
VIII. PRAYER ......................................................................................................... 54
CERTIFICATE OF COMPLIANCE ....................................................................... 55
CERTIFICATE OF SERVICE ................................................................................ 55
2 TABLE OF AUTHORITIES
Page(s) CASES Alamo Lumber Co. v. Fahrenthold, 58 S.W.2d 1085 (Tex. Civ. App.—Beaumont 1933, writ ref'd) ........................ 30 Alcatel USA, Inc. v. DGI Tech., 166 F.3d 772 (5th Cir. 1999) .............................................................................. 34 Amalgamated Acme Affiliates, Inc., v. Minton, 33 S.W.3d 387 (Tex. App.—Austin 2000, no pet.) ............................................ 25
AMF Tuboscope v. McBryde, 618 S.W.2d 105 (Tex.Civ.App.—Corpus Christi 1981, writ ref'd n.r.e.) .......... 29 Avera v. Clark Moulding, 791 S.W.2d 144 (Tex. App.—Dallas 1990, no writ) .......................................... 33 Bank of Sw. v. Harlingen Nat'l Bank, 662 S.W.2d 113 (Tex.App.—Corpus Christi 1983, no writ) ............................. 31
Birnbaum v. Law Offices of G. David Westfall, 120 S.W.3d 470, 477 (Tex. App.—Dallas 2003, pet. denied)............................ 53
Blanche v. First Nationwide Mortg. Corp., 74 S.W.3d 444 (Tex. App.—Dallas 2002, no pet.) ............................................ 48 Butnuru v. Ford Motor Co., 8 S.W.3d 198 (Tex. 2002)................................................................................... 22
Camp v. Shannon, 162 Tex. 515, 348 S.W.2d 517 (Tex. 1961) ....................................................... 32
Clayton v. Richards, 47 S.W.3d 149 (Tex. App.—Texarkana 2001, pet. denied) ............................... 48 Cohn v. Comm’n for Lawyer Discipline, 979 S.W.2d 694 (Tex. App.—Houston [14th Dist.] 1998, no pet.) ................... 23
3 Collins v. Collins, 904 S.W.2d 792 (Tex. App.-Houston [1st Dist.] 1995), writ denied per curiam, 923 S.W.2d 569 (Tex. 1996) ................................................................. 48
Collins v. Ryon's Saddle & Ranch Supplies, Inc., 576 S.W.2d 914 (Tex. Civ. App.—Fort Worth 1979, no writ) .......................... 45 Cottingham v. Engler, 178 S.W.2d 148 (Tex. Civ. App.—Dallas 1944, no writ) .................................. 45 David v. Bache Halsey Stuart Shields, Inc., 630 S.W.2d 754,756-57 (Tex.App.—Houston [1st Dist.] 1982, no writ) .......... 25
EMS USA, Inc. v. Shary, 309 S.W.3d 653 (Tex. App.—Houston [14th Dist.] 2010, no pet.) ................... 21 EMSL Analytical, Inc. v. Younker, 154 S.W.3d 693 (Tex. App.—Houston [14th Dist.] 2004, no pet.) ................... 33 Forbes Inc. v. Granada Biosciences, Inc., 124 S.W.3d 167, 47 Tex. Sup. Ct. J. 162 (Tex. 2003) ....................................... 47
Frequent Flyer Depot, Inc. v. Am. Airlines, Inc., 281 S.W.3d 215 (Tex. App.—Fort Worth 2009, pet. denied), cert. denied, 130 S. Ct. 2061, 176 L. Ed. 2d 414 (U.S. 2010)................................................. 31 Garth v.
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ACCEPTED 05-15-00444-CV FIFTH COURT OF APPEALS DALLAS, TEXAS 8/3/2015 4:42:36 PM LISA MATZ CLERK
CASE NO. 05-15-00444-CV __________________________________________________________________ FILED IN 5th COURT OF APPEALS In the Court of Appeals DALLAS, TEXAS for the Fifth District of Texas 8/3/2015 4:42:36 PM Dallas, Texas LISA MATZ Clerk __________________________________________________________________
BRADLEY B. MILLER Appellant,
v.
TALLEY DUNN GALLERY, LLC AND TALLEY DUNN Appellees.
__________________________________________________________________
Interlocutory Appeal from the 191st District Court, Dallas County, Texas
__________________________________________________________________
BRIEF OF APPELLEES TALLEY DUNN GALLERY, LLC AND TALLEY DUNN
__________________________________________________________________
Dan Hartsfield State Bar No. 09170800 Talley Parker State Bar No. 2406065872 Jackson Lewis P.C. 500 North Akard, Suite 2500 Dallas, TX 75201 Tel 214 520-2400 Fax 214 520- 2008
ATTORNEYS FOR APPELLEES
i TABLE OF CONTENTS
I. STATEMENT OF THE CASE .............................................................................. 8
II. STATEMENT REGARDING ORAL ARGUMENT ........................................... 8
III. ISSUES PRESENTED......................................................................................... 8
IV. STATEMENT OF FACTS .................................................................................. 9
V. PROCEDURAL BACKGROUND ..................................................................... 20
VI. SUMMARY OF ARGUMENT ......................................................................... 20
VII. ARGUMENT ................................................................................................... 21
A. The District Court Properly Entered A Temporary Injunction Against Appellant .......................................................................................... 21
1. ISSUE 1: Injunction No. 7 is Not an Unlawful Prior Restraint of Speech.............................................................................. 22
2. ISSUE 2: The Temporary Injunction Complies with Tex. R. Civ. P. 683 .............................................................................. 26
3. ISSUE 3: Appellees Offered Evidence of Irreparable Harm and No Adequate Remedy at Law....................................................... 28
4. ISSUE 4: Appellees Offered Evidence Establishing a Probably Right to Recover .................................................................................. 32
a. Misappropriation and/or Disclosure of Trade Secrets .............. 33
b. Tortious Interference with Business Relations ......................... 37
1) The Evidence Confirms Appellant’s Tortious Interference with Existing Relationships ......................... 37
2) The Evidence Confirms Appellant’s Tortious Interference with Prospective Relationships ................... 42
1 c. Harmful Access by Computer Violation .................................. 45
d. Texas Wiretapping Violation .................................................... 46
e. Defamation and Business Disparagement ................................ 46
f. Invasion of Privacy ................................................................... 48
B. The District Court’s Award of Attorneys’ Fees For Appellant’s Motion to Dismiss Should Not Be Set Aside ................................................ 50
1. ISSUE 5: The Trial Court Did Not Abuse its Discretion When It Determined that Plaintiff’s Motion was Frivolous and Awarded Fees ...................................................................................... 50
2. Appellant Waved Any Right to Appeal the Order Denying The Motion to Dismiss ........................................................................ 53
VIII. PRAYER ......................................................................................................... 54
CERTIFICATE OF COMPLIANCE ....................................................................... 55
CERTIFICATE OF SERVICE ................................................................................ 55
2 TABLE OF AUTHORITIES
Page(s) CASES Alamo Lumber Co. v. Fahrenthold, 58 S.W.2d 1085 (Tex. Civ. App.—Beaumont 1933, writ ref'd) ........................ 30 Alcatel USA, Inc. v. DGI Tech., 166 F.3d 772 (5th Cir. 1999) .............................................................................. 34 Amalgamated Acme Affiliates, Inc., v. Minton, 33 S.W.3d 387 (Tex. App.—Austin 2000, no pet.) ............................................ 25
AMF Tuboscope v. McBryde, 618 S.W.2d 105 (Tex.Civ.App.—Corpus Christi 1981, writ ref'd n.r.e.) .......... 29 Avera v. Clark Moulding, 791 S.W.2d 144 (Tex. App.—Dallas 1990, no writ) .......................................... 33 Bank of Sw. v. Harlingen Nat'l Bank, 662 S.W.2d 113 (Tex.App.—Corpus Christi 1983, no writ) ............................. 31
Birnbaum v. Law Offices of G. David Westfall, 120 S.W.3d 470, 477 (Tex. App.—Dallas 2003, pet. denied)............................ 53
Blanche v. First Nationwide Mortg. Corp., 74 S.W.3d 444 (Tex. App.—Dallas 2002, no pet.) ............................................ 48 Butnuru v. Ford Motor Co., 8 S.W.3d 198 (Tex. 2002)................................................................................... 22
Camp v. Shannon, 162 Tex. 515, 348 S.W.2d 517 (Tex. 1961) ....................................................... 32
Clayton v. Richards, 47 S.W.3d 149 (Tex. App.—Texarkana 2001, pet. denied) ............................... 48 Cohn v. Comm’n for Lawyer Discipline, 979 S.W.2d 694 (Tex. App.—Houston [14th Dist.] 1998, no pet.) ................... 23
3 Collins v. Collins, 904 S.W.2d 792 (Tex. App.-Houston [1st Dist.] 1995), writ denied per curiam, 923 S.W.2d 569 (Tex. 1996) ................................................................. 48
Collins v. Ryon's Saddle & Ranch Supplies, Inc., 576 S.W.2d 914 (Tex. Civ. App.—Fort Worth 1979, no writ) .......................... 45 Cottingham v. Engler, 178 S.W.2d 148 (Tex. Civ. App.—Dallas 1944, no writ) .................................. 45 David v. Bache Halsey Stuart Shields, Inc., 630 S.W.2d 754,756-57 (Tex.App.—Houston [1st Dist.] 1982, no writ) .......... 25
EMS USA, Inc. v. Shary, 309 S.W.3d 653 (Tex. App.—Houston [14th Dist.] 2010, no pet.) ................... 21 EMSL Analytical, Inc. v. Younker, 154 S.W.3d 693 (Tex. App.—Houston [14th Dist.] 2004, no pet.) ................... 33 Forbes Inc. v. Granada Biosciences, Inc., 124 S.W.3d 167, 47 Tex. Sup. Ct. J. 162 (Tex. 2003) ....................................... 47
Frequent Flyer Depot, Inc. v. Am. Airlines, Inc., 281 S.W.3d 215 (Tex. App.—Fort Worth 2009, pet. denied), cert. denied, 130 S. Ct. 2061, 176 L. Ed. 2d 414 (U.S. 2010)................................................. 31 Garth v. Stacte Corp., 876 S.W.2d 545 (Tex. App.—Austin 1994, writ dism’d w.o.j.) ........................ 28 Gillen v. Diadrill, Inc., 624 S.W. 2d 259 (Tex. App.—Corpus Christi 1981, no writ) ........................... 28
Glenn v. Gidel, 496 S.W.2d 692 (Tex. Civ. App.—Amarillo 1973, no writ) .............................. 46
Hancock v. Variyam, 400 S.W.3d 59 (Tex. 2013)................................................................................. 43
Home Sav. of Am. v. Van Cleave Dev. Co., 737 S.W.2d 58 (Tex. App.—San Antonio 1987, no writ) .................................. 21 Hurlbut v. Gulf Atl. Life Ins. Co., 749 S.W.2d 762, 31 Tex. Sup. Ct. J. 144 (Tex. 1987) ....................................... 47
4 IAC, Ltd. v. Bell Helicopter Textron, Inc., 160 S.W.3d 191 (Tex. App.—Fort Worth 2005, no pet.).............................32, 35
In re N.E.B., 251 S.W.3d 211 (Tex. App.—Dallas 2008, no pet.) .......................................... 53
In re Newton, 146 S.W.3d 648 (Tex. 2004) .............................................................................. 21
Intercontinental Termians Co., LLC. v. N. Am., Inc., 354 S.W. 3d 887 (Tex. App.—Houston [1st Dist.] 2011, no pet.) ..................... 28
Karamchandani v. Ground Tech., Inc., 678 S.W.2d 580 (Tex. App.—Houston [14th Dist.] 1984, no writ) ................... 25
Keystone Life Ins. v. Mktg. Mgmt., 687 S.W.2d 89 (Tex. App.—Dallas 1985, no writ) ................................27, 29, 47
Levine v. Steve Scharn Custom Homes, Inc., 448 S.W.3d 637 (Tex. App.—Houston [1st Dist.] 2014, pet. denied) ............... 44 Lifeguard Benefit Servs v. Direct Med Network Solutions, Inc., 308 S.W.3d 102 (Tex. App.—Fort Worth 2010, no pet.).............................30, 31
Main v. Royall, 348 S.W.3d 318 (Tex. App.—Dallas 2011, no pet.) ....................................40, 44 Marketshare Telecom, L.L.C. v. Ericsson, Inc., 198 S.W.3d 908 (Tex. App.—Dallas 2006, no pet.) .......................................... 24 Martin v. Linen Sys. for Hosp., Inc., 671 S.W. 2d 706 (Tex. App.—Houston [1st Dist.] 1984, no writ) .................... 27 McIntyre v. Wilson, 50 S.W.3d 674 (Tex. App.—Dallas 2001, pet. denied)...................................... 53
N.Y. Times v. Sullivan, 376 U.S. 254 (1964) ............................................................................................ 51
Owens v. State, 820 S.W.2d 912 (Tex. App.—Houston [1st Dist.] 1991, pet. ref'd) ................... 25
5 Pickens v. Cordia, 433 S.W.3d 179 (Tex. App.—Dallas 2014, no pet.) .......................................... 51
Prudential Ins. Co. of Am. v. Fin. Review Servs., Inc., 29 S.W.3d 74 (Tex. 2000)................................................................................... 37
RenewData Corp. v. Strickler, No. 03-05-00273-CV, 2006 Tex. App. LEXIS 1689, 2006 WL 504998 (Tex. App.—Austin Mar. 3, 2006, no pet.) (mem. op.)...................................... 31 Rugen v. Interactive Bus. Sys., 864 S.W.2d 548 (Tex. App.—Dallas 1993, no writ) .......................................... 26
Sharma v. Vinmar Int’l Ltd, 231 S.W.3d 405 427 (Tex. App.—Houston [14th Dist.] 2007, no pet.) ............ 31 State v. Cook United, Inc., 464 S.W. 2d 105 (Tex. 1971) ............................................................................. 26 Sterner v. Marathon Oil Co., 767 S.W.2d 686 (Tex. 1989) .............................................................................. 42
Sullivan v. Bickel & Brewer, 943 S.W.2d 477 (Tex. App.—Dallas 1995, writ denied) ................................... 54
Sun Oil Co. v. Whitaker, 424 S.W. 2d 216 (Tex. 1968) ............................................................................. 21 Surko v. Borg-Warner, 782 S.W.2d 223 (Tex. App.—Houston [1st Dist.] 1989, no writ) ..................... 32
T-N-T Motorsports v. Hennessey, 965 S.W.2d 18 (Tex. App.—Houston [1st Dist.] 1998, pet. dismissed) ......31, 32
Tex. Dep’t of Transp. v. Barber, 111 S.W. 3d 86 (Tex. 2003)................................................................................ 25
Tex. Disposal Sys. Landfill, Inc. v. Waste Mgmt. Holdings, Inc., 219 S.W.3d 563 (Tex. App.—Austin 2007, pet. denied) ................................... 43
Townson v. Liming, No. 06-10-00027-CV, 2010 Tex. App. LEXIS 5459, 2010 WL 2767984 (Tex. App.—Texarkana July 14, 2010, no pet.) (mem. op.) .............................. 31
6 Transperfect Translations, Inc. v. Leslie, 594 F. Supp. 2d 742 (S.D. Tex. 2009) ................................................................ 30
Walling v. Metcalfe, 863 S.W. 2d 56 (Tex. 1993)................................................................................ 29
WFAA-TV, Inc. v. McLemore, 978 S.W.2d 568 (Tex. 1998) .............................................................................. 46
Wright v. Sport Supply Grp., Inc., 137 S.W.3d 289 (Tex. App.—Beaumont 2004, no pet.) .................................... 32
STATUTES TEX. CIV. PRAC. & REM. CODE § 10.002.................................................................. 53
TEX. CIV. PRAC. & REM. CODE § 27.003(a) ............................................................. 50 TEX. CIV. PRAC. & REM. CODE § 73.001......................................................40, 43, 44
TEX. CIV. PRAC. & REM. CODE § 143.001................................................................ 45 TEX. PENAL CODE § 31.05(b)(3) ............................................................................... 40 TEX. PENAL CODE § 33.01(11) ................................................................................. 17
TEX. PENAL CODE § 33.02 ........................................................................................ 17 TEX. PENAL CODE §§ 37.02, 37.03 ........................................................................... 40
OTHER AUTHORITIES TEX. R. CIV. P. 38.1 .................................................................................................. 53 TEX. R. CIV. P. 683 ............................................................................................passim
7 I. STATEMENT OF THE CASE
Appellees Talley Dunn Gallery, LLC and Talley Dunn filed the underlying
proceeding on February 11, 2015 to stop her ex-husband’s harassment and
attempts to destroy her business by disseminating confidential information about
the Gallery and interfering with her business relationships with artists, clients, and
employees. The District Court entered a Temporary Restraining Order in favor of
Dunn on February 11, 2015 and, after an agreed extension of the TRO, the District
Court presided over the temporary injunction hearing on March 2, 4, and 12, 2015.
After the three-day hearing, the District Court determined that Appellees had
satisfied the prerequisites for a temporary injunction and on March 19, 2015
entered a temporary injunction to maintain the status quo until a trial on the merits,
which the District Court set for February 1, 2016.
II. STATEMENT REGARDING ORAL ARGUMENT
If the Court grants Appellant’s request for oral argument, the Gallery and Dunn
request the opportunity to respond with oral argument to the Court. Otherwise,
Appellees believe this appeal can be decided on the record.
III. ISSUES PRESENTED
1. Was it an abuse of discretion to enjoin Appellant from republishing
false, misleading, and defamatory statements to known clients of the Gallery?
8 2. Did the Temporary Injunction entered by Judge Ted M. Akin,
presiding for the 191st Judicial District Court, satisfy the specificity requirements
of TEX. R. CIV. P. 683?
3. Did the District Court abuse its discretion when it found Appellees
would suffer irreparable harm without an adequate remedy at law absent the
temporary injunction?
4. Did the District Court abuse its discretion when it found Appellees
had a probable right to relief with respect on their claims for misappropriation
under the Texas Uniform Trade Secrets Act (Count I), tortious interference with
business relations (Count II), harmful access by computer (Count III), unlawful
wiretapping (Count IV), defamation and business disparagement (Count VI), and
invasion of privacy (Count VII)?
5. Did the District Court abuse its discretion when it awarded attorneys’
fees to Appellees in opposing Appellant’s frivolous Motion to Dismiss?
IV. STATEMENT OF FACTS
1. Appellee Dunn owns and operates the Talley Dunn Gallery, L.L.C.
(Gallery). She has been a practicing and successful art dealer in Dallas, Texas
since 1990 (3 R.R. 87; C.R. 28.) Over her 24+ year career, Dunn has built long-
term relationships with prominent and leading artists, collectors, curators, critics,
educators, and arts patrons and earned a reputation for honesty, integrity and
9 business ethics. (3 R.R. 94-97; 99; C.R. 107, ¶ 4.05.) Dunn’s reputation for
honesty and integrity is one of the most critical aspects of operating the Gallery. (3
R.R. 106-108.)
2. In marketing, exhibiting, and selling art, Appellees have expended
substantial time, labor, and money to develop these business relationships. (C.R.
107, ¶ 4.06.) Client lists, purchase history, and pricing information are
confidential, including the Appellees’ general ledgers that compile such
information (Confidential Information). (Id.) This Confidential Information is
neither available to nor known by the general public or competing art galleries. (3
R.R. 140-141; 166-167.) The Gallery has taken substantial measures to prevent its
Confidential Information from becoming publicly available. (3 R.R. 140-141; 3
R.R. 166-167; C.R. 107, ¶ 4.06.)
3. Appellant was married to Dunn until divorced in April 2014. (C.R. 29,
2 R.R. 30.) During their divorce proceeding, Miller gained access to the Gallery’s
confidential general ledger for the period from January 2, 2013 through October
24, 2013 (the General Ledger). (C.R. 108, ¶ 4.08, 5 R.R. Ex. 18;) The General
Ledger was produced in confidence and for the limited purpose of settlement
negotiations. (C.R. 29, 113-116; 2 R.R. 70-71.) Absent the divorce proceedings,
Appellant would not have access to the General Ledger. (Id.) The General Ledger
included private and confidential information about every vendor, client, and artist
10 that worked with the Gallery, including discounts offered to clients, sales pricing,
commissions paid to individual artists, and profit margins. (Id.; C.R. 29-30, 2 R.R.
90-91; 3 R.R. 140-141, 180-181.) Appellant conceded that the General Ledger
included customer names, listed business transactions between the Gallery and
customers, and contained information not publicly available. (2 R.R. 83, 90.)
Unauthorized disclosure of the Confidential Information could be both detrimental
to, and used to the competitive disadvantage of, Dunn and the Gallery. (3 R.R.
140-141.) The General Ledger is password protected and accessible by only one
Gallery employee. (3 R.R. 142.)
4. Appellant used the General Ledger to identify Gallery clients and
artists, to interfere with their existing and prospective business relationships with
the Gallery, and to persuade these clients or artists to cease doing business with the
Gallery. (C.R. 29, 110, ¶ 4.12.)
5. For example, by email dated December 5, 2014, Appellant used
information from the General Ledger to identify and contact an important Gallery
client and blame the client’s artwork purchases from the Gallery for Appellant’s
91-year-old father being hospitalized. (5 R.R., Ex. 10.) Appellant accompanied the
email harangue with a photograph of his ill father in ICU, stating:
Please take a look at the attached Talley Dunn Gallery Ledger, which Talley
produced in discovery. Your name is prominently featured (on 6/21/13,
11 7/2/13, 8/5/13, 9/4/13, 10/2/13). Then take a look at the attached photo of
my father in the Presbyterian ICU. That’s what you –personally—were
funding.
(5 R.R., Ex. 10; C.R. 109, ¶ 4.12.) Appellant admitted he was aware that this
individual was a client of the Gallery only because “I had noticed on the ledger that
her name was listed as having made payments to the gallery. . .” (3 R.R. 31, 53.)
6. Appellant also used the General Ledger to identify David
Haemisegger—co-owner of NorthPark mall and a Director of the Nasher
Museum—as another important client of the Gallery. (2 R.R. 131-132.) Armed
with his misappropriated information, Appellant emailed Haemisegger and accused
Dunn of committing a criminal act. (2 R.R. 53, 99-100, 5 R.R. Ex. 3.) To
Haemisegger and others, Defendant has repeatedly published that Dunn committed
“perjury” in an affidavit and testimony (e.g., “lying in court,” a “lie-filled battle,”
“lies she repeated in court,” ”making false claims of violence,” “was shown to be
lying in court,” “repeated these lies in court in our first full hearing . . . and in
subsequent hearings,” “lies and other fraudulent actions,” “lies to the Court about
the Gallery income,” “obvious perjury,” “false TRO affidavits,” a “false”
affidavit” with “fabricated allegations of violence,” “outright lies,” “distortions and
outright lies,” “pervasive lies” or “grotesquely fabricated claims.”). Dunn
confirmed her sworn prior statements were true and correct. (3 R.R. 112-116.)
12 7. The false, misleading and defamatory statements published to the
Gallery’s customers were made with the intent to end or otherwise interfere with
those commercial relationships. (C.R. 34, ¶¶13-14; 3 R.R. 111.) Publishing the
Gallery’s Confidential Information threatens to impair the Gallery’s business
particularly with those clients who do not wish for their private information to be
disseminated or made public. (C.R. 30.) Appellant has interfered and impaired the
goodwill that Dunn and the Gallery have spent the last 24 years building in the
Dallas arts community. (3 R.R. 171.)
8. Appellant also intentionally interfered, without privilege or
justification, with the Gallery’s artist relationships. (3 R.R. 199, C.R. 110, ¶ 4.13.)
The Gallery exhibits and sells contemporary art by established artists pursuant to
consignment agreements between the artists and the Gallery. (3 R.R. 100-103.)
Appellant sent letters, emails and other materials to these artists represented to
disrupt or impair consignment agreements. (C.R. 109, ¶ 4.12.)
9. David Bates is the Gallery’s most important artist. (3 R.R. 145.)
Armed with misappropriated financial information from the General Ledger,
Appellant sent a letter to Bates before a scheduled exhibition of his art at the
Gallery and again alleged a causal connection between his father’s heart attack and
the Gallery’s sale of Bates’s artwork. (2 R.R. 49, 110, 5 R.R. Ex. 2; 2 R.R. 115.)
13 Your art is providing most of the funding for the continuing legal onslaught
of the past year and the massive harm it has caused my family. . .That is very
clear from looking at the gallery ledger.
Appellant warned Bates that going through with his upcoming show at the Gallery
could provide sufficient “financial ammunition” to continue so-called attacks. (2
R.R. 118.) Following receipt of that letter from Appellant, Dunn’s relationship
with Bates changed. (3 R.R. 152.)
10. In other efforts to destroy the Gallery’s relationship with Bates,
Appellant has repeatedly published statements that imply or insinuate that Dunn
engaged in sexual misconduct, marital infidelity or adultery (e.g., “romantic text
messages”). (3 R.R. 7-8, 5 R.R. Ex. 2 and 7.) Under cross-examination, Miller
backpedaled saying that “I think she was [lying] to cover up a crush [on David
Bates] or something like that. I don’t think it was any more than that.” (2 R.R.
127-128.) Appellant conceded that he published statements accusing Dunn of
sexual misconduct based on nothing more than his perception of a “constellation of
things” in Dunn’s behavior. (2 R.R. 11.) Dunn testified unequivocally that she has
never engaged in any sexual misconduct, marital infidelity or adultery. (3 R.R.
127-128.)
11. Appellant also emailed Gallery artists Matthew Sontheimer and Trent
Hancock alleging sexual misconduct between Dunn and Bates. (2 R.R. 61-62; 3
14 R.R. 6, Ex. 7.) These allegations of impropriety harm Dunn’s reputation and
threaten the Gallery’s relationship with its other artists. (3 R.R. 162-163.) In fact,
Hancock and another artist did, in fact, leave the Gallery following Appellant’s
interference. (3 R.R. 171; 200-201.)
12. Appellant also targeted the Gallery’s employment relationships. The
Gallery hires employees to exhibit and sell contemporary art. (C.R. 28.) Appellant
sent letters and other materials to Beth Taylor, the Director of the Gallery, and to
the parents of Meredith Leyendecker, another Gallery employee, in an effort to
disrupt or destroy the employment relationship. (2 R.R. 133, 5 R.R. Ex. 4, 2 R.R.
135, 5 R.R. Ex. 5, C.R. 118, ¶ 4.14.) These acts intentionally interfered, without
privilege or justification, with the employment relationships that exist between the
Gallery and its employees. (Id.)
13. Appellant published these false and misleading letters, emails and
other verbal and written statements intending to end or prevent business
relationships from continuing with customers, artists, or employees. The
communications declare or suggest that Dunn is dishonest, a swindler, scam artist,
a criminal, untrustworthy, perjurer, pathological liar, sociopath, psychopath,
borderline and narcissist. (3 R.R. 34-35; 5 R.R. Ex. 2-10.) Appellant also
distributed false and misleading letters and emails characterizing Dunn as an
adulterer and associated Dunn with criminal conduct involving fraud, pedophilia,
15 battery, sexual assault, and child abuse. (Id.) Dunn could not maintain the Gallery
if she developed the reputation alleged by Appellant. (3 R.R. 108.)
14. In reference to a former business partner, Defendant has repeatedly
and falsely published that a former business partner of Dunn was cheated “out of
the gallery without any compensation” or “with no compensation for the business
itself.” (3 R.R. 19.) Defendant has repeatedly published that Plaintiff Dunn was
dishonest about her former business partner (e.g., Dunn is “lying” or “spreading
lies” about a former business partner or “Talley’s lies” or “lied to me extensively
about her business partner” or “lying about this episode and other alleged
stealing”). (5 R.R. Ex. 3, Ex. 4; C.R. 125-128.) Appellant admitted at the hearing
that the business partner did, in fact, receive compensation from Dunn. (3 R.R. 20-
21.) Likewise, Dunn testified confirmed the partnership was divided equitably and
in half. (3 R.R. 91-92.)
15. In reference to Dunn’s mental health, Appellant has repeatedly and
falsely published that she suffers from personality or mental disorders (e.g.,
“sociopath,” “sociopathy,” “sociopathic behavior,” “psychopath,” “psychopathy,”
“narcissist,” “malignant narcissist,” “personality disorder,” “serial abuser,” or
“borderline”). (C.R. 124, ¶¶ 10.04-10.06; 3 R.R. 25-26, 41, 5 R.R. Ex. 6, 7, 8, Ex.
12; C.R. 125-128.)
16 16. Appellant has also publicly associated Dunn with sexual and child
abuse and domestic violence, comparing her to “Bill Cosby,” “Penn State,”
“Adrian Peterson” or “Ray Rice.” (3 R.R. 27, 35; C.R. 125-128.)
17. Often attached or enclosed with Appellant’s tortious communications
with customers, artists, and employees were audio recordings of Dunn or pictures
of text messages from Dunn’s personal cellphone. (See 5 R.R. Ex. 2, 4, 5, 7, and
10; C.R. 33.) For over two years, from January 2012 through April 2014,
Appellant surreptitiously recorded Plaintiff’s private conversations, both in her
home and in her car, and accessed her private emails, text messages, voice
messages, call logs and telephone records without her consent. (2 R.R. 64; C.R. 32-
33; C.R. ¶¶ 11.02-11.07.)
18. Without authorization from Dunn and while she was sleeping,
Appellant accessed Dunn’s smart phone and computerized data as defined in
Section 33.01(11) of the Texas Penal Code and in violation of Section 33.02 of the
Texas Penal Code. (2 R.R. 125-126, 5 R.R. Ex. 2.) Appellant then disseminated
and published the data wrongfully obtained. (See 5 R.R. Ex. 2, 4, 5, 7, and 10.)
Appellant concedes that the phone was password protected. (3 R.R. 67.) Dunn
did not give Appellant permission to access her phone, e-mails, voicemails, text
messages, or call logs. (3 R.R. 129.)
17 19. Over a period of several months, Appellant also concealed a digital
recorder in Dunn’s car. (2 R.R. 65; C.R. 32-33, ¶ ¶11-12.) Appellee recorded
conversations that Dunn had with third parties while driving. (2 R.R. 65). In
doing so, Appellant intercepted and acquired the contents of Dunn’s
communications through the use of the digital recorder without the consent of any
party to the communication. (Id.) Dunn discovered a log maintained by Appellant
in which he meticulously tracked her daily movements, conversations, emails, and
text messages for over a year prior to their divorce. (3 R.R. 132-133.) In that log,
Dunn observed notations of recordings made by Appellant of Dunn in her car when
Appellant was not present. (3 R.R. 133-134, 5 R.R. Ex. 15; C.R. 33.) Appellant
clarified that he did not know what happened to the unlawful recordings he had
surreptitiously made. (2 R.R. 66.)
20. Appellant’s wrongful conduct is damaging the Gallery’s good will,
business relationships, Dunn’s reputation, and is harming her business and health.
(C.R. 110, 112 ¶¶ 4.13, 4.19.) Dunn has suffered emotional distress, lost artists,
and endured loss of reputation, shame, embarrassment as well as injury to her good
name and reputation. (C.R. 130, ¶ 10.13.)
21. Without Dunn, the Gallery has no value. (3 R.R. 106.) Appellant
knows that Dunn suffers from multiple sclerosis. (3 R.R. 37-38.) Dunn testified
and Appellant admits that stress causes symptom flare-ups for Dunn. (3 R.R. 38,
18 138.) Appellant has even contacted Dunn’s treating physicians to disparage her,
attack her character and integrity, and provide them with the Gallery’s General
Ledger. (C.R. 111, ¶ 4.17; 6 R.R. Ex. 12-13.) As a result, Dunn’s MS has flared up
over the course of Appellant’s systemic and constant harassment. (3 R.R. 171.)
22. Appellant is attempting to destroy Dunn’s business. (3 R.R. 111, 185,
C.R. 30.) If not stopped, Appellant will continue those attempts. (3 R.R. 111,
139.)
23. Dunn testified that damages to her person and her business are not
easily calculated, quantified or ascertained. (C.R. 23 ¶¶10.03.) Two artists have
been lost. (3 R.R. 171; 200-201.) Her relationship with the Gallery’s key artist
David Bates has been impaired. (3 R.R. 152.) Dunn testified that it was impossible
to value the goodwill associated with the Gallery. (3 R.R. 106.) It is difficult to
assess the damage done to this goodwill, the harm caused by the loss of the
confidentiality of her business dealings with artists and clients or even identify
those customers who have refrained from further dealings with the Gallery. (Id.)
The full extent of Dunn’s and the Gallery’s damages are unknown. (C.R. 129, ¶
10.12.)
24. Even if damages could be sufficiently quantified and calculated,
Appellant lacks the financial resources to provide adequate relief or respond in
monetary damages. (Id.).
19 25. Appellant’s own ballpark estimate of the Gallery’s value is in excess
of $4.5 million. (2 R.R. 109-110, 5 R.R., Ex. 2). Appellant admitted that he is in
financial distress. His only income is as an “IT Consultant” for which he had
earned approximately $30,000 in 2014. (2 R.R. 32-33.) He admitted that as of
last year, he was deeply in debt and living with his parents because he could not
afford a place of his own. (5 R.R., Ex. 2.) Appellant has no ability to pay
damages if he continues to attack the Gallery and Dunn.
V. PROCEDURAL BACKGROUND
The District Court entered a TRO against Appellants on February 11, 2015.
(C.R. 36-40.) After an agreed extension of the TRO, the District Court held a
temporary injunction hearing on March 2, 4, and 12. (1 R.R. 1-9.) Both Miller
and Dunn testified at the hearing and documents were introduced as exhibits for
the District Court’s review. (Id). After the three-day hearing, the District Court
granted Appellees’ request for a temporary injunction. (C.R.250-263.) In this
appeal, Appellant launches an across-the-board attack on the equitable grief
granted to Appellees.
VI. SUMMARY OF ARGUMENT
The District Court correctly found that Appellees met the prerequisites for a
temporary injunction. The District Court’s narrowly tailored restrictions on are
based on the evidence presented at the temporary injunction hearing. The 14 page
20 Temporary Injunction Order painstakingly describes the acts to be enjoined and
why a temporary injunction is required, thus satisfying the specificity requirements
of Rule 683. Finally, Appellees demonstrated irreparable harm, no adequate
remedy at law, and probable recovery on the merits on their claims.
Nor did Judge Aiken abuse his discretion in determining that Appellant’s
Motion to Dismiss under the Texas Citizens Participation Act (TCPA) was
frivolous and without evidentiary support.
VII. ARGUMENT
A. The District Court Properly Entered a Temporary Injunction Against Appellant.
In temporary injunction cases, the question on appeal is whether the trial
court abused its discretion. Sun Oil Co. v. Whitaker, 424 S.W. 2d 216, 218 (Tex.
1968). All legitimate inferences from the evidence are drawn in the light most
favorable to the trial court’s decision. EMS USA, Inc. v. Shary, 309 S.W.3d 653,
657 (Tex. App.—Houston [14th Dist.] 2010, no pet.). So long as some evidence
supports the court’s decision, there is no abuse of discretion. Id.
A temporary injunction preserves the status quo or prevents irreparable
injury pending final determination on the merits. In re Newton, 146 S.W.3d 648,
651 (Tex. 2004). To obtain a temporary injunction, Appellees were not required to
establish they will ultimately prevail at trial. Home Sav. of Am. v. Van Cleave Dev.
Co., 737 S.W.2d 58, 60 (Tex. App.—San Antonio 1987, no writ). Rather,
21 Appellees must establish (1) a cause of action against Appellant, (2) a probable
right to relief, and (3) irreparable injury. Butnuru v. Ford Motor Co., 8 S.W.3d
198, 204 (Tex. 2002). The District Court’s finding that Appellees satisfied these
elements is supported by the record.
1. ISSUE 1: Injunction No. 7 is Not an Unlawful Prior Restraint of Speech
The Court issued a narrowly tailored injunction that enjoined Appellant in
Injunction No. 7 from communicating to persons known to him to be clients or
customers of the Gallery three very specific statements: that Dunn (a) committed
perjury in the divorce proceedings between Dunn and Appellant; (b) committed
sexual misconduct or adultery while married to Appellant; and/or (c) forced her
former business partner out of the gallery “without any compensation.” (, C.R.
261, ¶ 7.)1
The District Court found that the previously published statements were false
and defamatory and the injunction was limited to the repetition of the same false
and misleading communications:
(a) Perjury: The District Court found that Appellant had “repeatedly
published that Dunn committed ‘perjury’ in connection with an affidavit and her
1 Reflecting its careful tailoring, the Temporary Injunction, in paragraph 8, confirms that Appellant is not restricted from speaking on these matters to any board members or parents of The Hockaday School (where Appellant’s child attends) even if they are known clients or customers of the Gallery.
22 testimony” in the parties’ divorce proceeding. (Temporary Injunction ¶ 12, C.R.
255). The District Court found “these publications to be false, misleading and
defamatory.” (Id. at C.R. 256.) The evidence supports these findings. (Statement
of Facts § 6.)
Dunn testified that her sworn statements in the divorce proceedings were
true and correct. (Id.) Dunn testified about Appellee’s violent outbursts, and his
denials do not warrant reversal. Where there is conflicting testimony, the trial
court is the sole judge of the credibility of the witnesses and the weight to be given
their testimony. Cohn v. Commission for Lawyer Discipline, 979 S.W.2d 694, 696
(Tex. App.—Houston [14th Dist.] 1998, no pet.).
(b) Adultery: The District Court found that Miller had “repeatedly
published statements that imply or insinuate that Dunn engaged in sexual
misconduct or…adultery.” (Temporary Injunction ¶ 14, C.R. 256-257.) The
District Court found “these publications are false, misleading, and defamatory.”
(Id. at C.R. 256.) The evidence supported this finding. (Statement of Facts ¶ 10.)
At the temporary injunction hearing, Appellant even admitted that he lacked not
only proof of adultery but even a good faith belief of an affair, conceding his
suspicion to be only of a “crush!” (Statement of Facts ¶ 10.) In contrast, Dunn
was unequivocal in her denial of any infidelity, adultery, or other sexual
misconduct. (Id.)
23 (c) Business Partner: The District Court found that Appellant “has
repeatedly published that the former business partner was cheated ‘out of the
gallery without any compensation.’” (Temporary Injunction ¶ 13, 256.) The
District Court found “these publications are false, misleading and defamatory.”
(Id.) The evidence supported this finding. (Statement of Facts ¶ 15.) Appellant
conceded that the business partner did, in fact, receive substantial compensation,
and Dunn testified that the partnership was divided in half. (Id.)
Dunn also offered evidence that these false, misleading and defamatory
statements published to the Gallery’s customers and artists were made by
Appellant with the intent to disrupt or interfere with those business relationships.
(Statement of Facts ¶ 7.) The District Court heard testimony that if not enjoined,
Appellant would continue to interfere with and attempt to destroy her business.
(Statement of Facts ¶ 22.) Because Appellees have established the threat of
irreparable harm (see below) and no less restrictive means to prevent the
continuing harm are available, Appellees were entitled to a narrowly tailored
injunction, enjoining Appellant from repeating those false, misleading, and
defamatory statements.
Appellees recognize that a judicial order forbidding repetition of certain
defamatory speech constitutes a prior restraint. Marketshare Telecom, L.L.C. v.
Ericsson, Inc., 198 S.W.3d 908, 917 (Tex. App.—Dallas 2006, no. pet.), citing
24 Alexander v. United States, 509 U.S. 544, 550 (1993). But the “First Amendment
does not guarantee the right to communicate one’s views at all times and places or
in any manner.” Tex. Dep’t of Transp. v. Barber, 111 S.W. 3d 86, 92 (Tex. 2003).
In the present case, Appellant’s defamatory speech also constituted
commercial speech. Prior restraints are permissible when the enjoined speech
constitutes commercial speech. Amalgamated Acme Affiliates, Inc., v. Minton, 33
S.W.3d 387 (Tex. App.—Austin 2000, no pet.); Karamchandani v. Ground
Technology, Inc., 678 S.W.2d 580 (Tex. App.—Houston [14th Dist.] 1984, no
writ). See also Owens v. State, 820 S.W.2d 912, 914 (Tex. App.—Houston [1st
Dist.] 1991, pet. ref'd) (holding that "[i]ntentionally false or misleading statements
made in a commercial context are not protected").
In Amalgamated Acme, because the defendants’ statements were "intended
to end contractual relationships between [the plaintiff] and his customers, or to
prevent contractual relationships with potential customers," the appellate court
agreed that it was commercial speech. Id. at 394. Justice Bea Ann Smith
explained that "to enjoy any protection, commercial speech must not be false or
misleading." Id. Because the defendant’s speech was both false and misleading,
the appellate court held that the trial court properly enjoined defendants from
making in the future the same communications the plaintiff proved it had made in
25 the past. Id. Specifically, in relevant part, the appellate court upheld an injunction
commanding the defendant to refrain from:
(a) communicating to the . . . any businesses known to be a customer of Dean Allen, and/or any businesses known to be a potential customer of Dean Allen (including all employees and agents of all of the foregoing businesses) that Dean Allen or Minton has committed fraud, made misrepresentations, engaged in a scam, engaged in unfair competition, hurt the Austin Independent School District, hurt the University of Texas, hurt any other customer, violated any contract or agreement, or violated any law;
(b) communicating to the advertisers on Exhibit A . . . that Dean Allen or Minton has committed fraud, made misrepresentations, engaged in a scam, engaged in unfair competition, hurt the Austin Independent School District, hurt the University of Texas, hurt any other customer, violated any contract or agreement, or violated any law.
A similar temporary injunction is justified here.
2. ISSUE 2: The Temporary Injunction Complies with TEX. R. CIV. P. 683.
Rule 683 requires a trial court to describe the acts to be enjoined and the
reasons for issuing the injunction. See State v. Cook United, Inc., 464 S.W. 2d 105
(Tex. 1971). “The rule's purpose is to ensure that parties are adequately informed
of the acts they are enjoined from doing and the reasons for the injunction.” Rugen
v. Interactive Business Sys., 864 S.W.2d 548, 553 (Tex. App.—Dallas 1993, no
writ).
The District Court’s Order meets these requirements. The Order details in
eight paragraphs – and over four pages - the specific acts to be enjoined. There is
26 little, if any, ambiguity about what Appellant is enjoined from doing. Its
prohibitions are limited to preventing the recurrence of the abusive and harassing
conduct previously committed by Appellant. The injunction adequately informs
him of the acts that he is enjoined from doing.
The reasons for the injunction are self-evident on its face. The District
Court explains that the injunction is issued because of the Appellant’s “wrongful,
damaging conduct.” This conduct is described in 17 paragraphs, describing
tortious (and criminal) behavior that “has occurred and will continue to occur if not
enjoined.” As summarized in Paragraph 18, the Court explained that the wrongful
conduct has occurred and will continue to threaten Dunn’s health, reputation, and
the goodwill of the Gallery and that the status quo would not be maintained absent
the injunction. (C.R. 250, ¶ 18.) Reading all 14 pages of the District Court’s
Temporary Injunction confirms that it adequately describes what is enjoined and
why in order to comply with Rule 683.
Judge Aiken’s findings are far more specific than others found to be
sufficient. For example, in Keystone Life Ins. v. Marketing Management, 687
S.W.2d 89, 93 (Tex. App.—Dallas 1985, no writ), the appellate court found this
statement to be sufficient: "Plaintiffs have also demonstrated that if defendant is
not enjoined from such conduct plaintiffs will probably be irreparably injured,
without adequate remedy at law, by the loss of the benefit of such trade secrets, a
27 portion of their business." Id. See also Martin v. Linen Systems for Hospitals, Inc.,
671 S.W. 2d 706, 711 (Tex. App.—Houston [1st Dist.] 1984, no writ)(statement
that injunction was necessary to protect “goodwill and business” and that moving
party would be harmed without injunction is complies with Rule 683); Gillen v.
Diadrill, Inc., 624 S.W. 2d 259 (Tex. App.—Corpus Christi 1981, no
writ)(statement that moving party “will probably sustain irreparable injury and
damage to its business” if allowed to continue to engage in behavior is “sufficient
compliance” with Rule 683). Here, the District Court’s Order complies with Rule
683.
3. ISSUE 3: Appellees Offered Evidence of Irreparable Harm and No Adequate Remedy at Law.
Appellant argues, without explanation, that any evidence of harm is rebutted
by the de minimus gap between his escalating misconduct in mid-December 2014
and the filing of Appellees’ Petition and the issuance of the TRO on February 11,
2015. However, “Texas case law does not prevent injunctive relief merely because
a potential plaintiff did not file a claim as quickly as possible.” Garth v. Stacte
Corp., 876 S.W.2d 545, 550-551 (Tex. App.—Austin 1994, writ dism’d
w.o.j.)(nine month delay no bar to recovery). This is especially true when, as here,
the misconduct and harm is ongoing and continuing. See Intercontinental
Termians Company, LLC. v. North America, Inc., 354 S.W. 3d 887, 894 (Tex.
App.—Houston [1st Dist.] 2011, no pet.)
28 Appellant next claims that Appellees have not identified an injury that
cannot be computed with a sufficient degree of certainty. Brief at 25. The
testimony confirmed that Appellant published and misused the confidential
General Ledger to persuade clients and artists to cease doing business with the
Gallery. (C.R. 29, 110, ¶ 4.12). The misuse of confidential information to
interfere with business relationships has been recognized as a ground for injunctive
relief due to the difficulty of establishing the amount of damages. Keystone Life
Ins., 687 S.W.2d at 92; see also David v. Bache Halsey Stuart Shields, Inc., 630
S.W.2d 754,756-57 (Tex.App.—Houston [1st Dist.] 1982, no writ) ("One cannot
assign a dollar value to a company's loss of clientele, goodwill, office stability. . .
."); see AMF Tuboscope v. McBryde, 618 S.W.2d 105, 108 (Tex.Civ.App.—
Corpus Christi 1981, writ ref'd n.r.e.). Likewise, the loss or disruption of a
business is the type of injury that qualifies for a temporary injunction. Walling v.
Metcalfe, 863 S.W. 2d 56, 58 (Tex. 1993).
There is also a presumption of irreparable harm associated with business loss
and damage to good will. Appellees did not simply rely on this presumption, but
also offered evidence that Appellees suffered irreparable harm. Due to Appellant’s
wrongful conduct, the Gallery faced the possible loss of customers, artists, and
employees in addition to the damage to goodwill. (See Statement of Facts ¶¶ 4-
12.) Contemporaneous with Appellant’s onslaught, two artists left the gallery.
29 Dunn also testified to the threat of customers discontinuing business with the
Gallery for fear that their private information would become public. (See
Statement of Facts. ¶¶ 7, 9, 11). Dunn likewise testified that she could not remain
in business if the disparagement peddled by the Appellant was believed, and her
reputation for honesty, integrity and fair dealing was destroyed by Appellant. (See
Statement of Facts ¶ 13.) This evidence is sufficient to demonstrate irreparable
harm. See Transperfect Translations, Inc. v. Leslie, 594 F. Supp. 2d 742, 757
(S.D. Tex. 2009)(holding that the “use of an employer's confidential information
and the possible loss of customers is sufficient to establish irreparable harm.”)
Appellant’s wrongful conduct jeopardized the goodwill of the Gallery.
(Statement of Facts ¶¶ 7, 20.) Texas law has long recognized that goodwill,
although intangible, is valuable property and an integral part of one’s business.
Alamo Lumber Co. v. Fahrenthold, 58 S.W.2d 1085, 1088 (Tex. Civ. App.—
Beaumont 1933, writ ref'd). Threatened injury to a business's reputation and good
will is frequently the basis for temporary injunctive relief. Id. Dunn also testified
that she could not quantify the Gallery’s goodwill. (Id. at ¶ 23.). Thus, the
irreparable injury requirement is satisfied when injuries of this nature are, like
established here, difficult to calculate or monetize. Intercontinental Terminals Co.,
LLC v. Vopak N. Am., Inc., 354 S.W.3d 887, 895-896 (Tex. App.—Houston 1st
30 Dist. 2011)(trial court did not abuse its discretion in granting temporary injunction
order).2
Dunn and the Gallery face irreparable harm, including the loss of business,
good will, employees, and reputation for which there is no adequate remedy at law.
See Sharma v. Vinmar Int’l Ltd, 231 S.W.3d 405, 427 (Tex. App. –Houston [14th
Dist.] 2007, no pet.); T-N-T Motorsports v. Hennessey, 965 S.W.2d 18, 24 (Tex.
App. –Houston [1st Dist.] 1998, pet. dismissed). Because there is little, if any,
value to the Gallery without Dunn at its helm, irreparable harm is likewise
established by the harm and threats of more harm to Dunn’s mental well-being and
physical health. (Statement of Facts ¶ 21.) 3
2 See also Lifeguard Benefit Servs v. Direct Med Network Solutions, Inc., 308 S.W.3d 102, 118 (Tex. App.—Fort Worth 2010, no pet.); Frequent Flyer Depot, Inc. v. Am. Airlines, Inc., 281 S.W.3d 215, 228 (Tex. App.—Fort Worth 2009, pet. denied), cert. denied, 130 S. Ct. 2061, 176 L. Ed. 2d 414 (U.S. 2010) ("Disruption to a business can be irreparable harm. Moreover, assigning a dollar amount to such intangibles as a company's loss of clientele, goodwill, marketing techniques, and office stability, among others, is not easy."); T-N-T Motorsports, 965 S.W.2d at 24 (affirming temporary injunction based on testimony that lost goodwill would be "immeasurable"); Townson v. Liming, No. 06-10-00027-CV, 2010 Tex. App. LEXIS 5459, 2010 WL 2767984, at *2-3 (Tex. App.—Texarkana July 14, 2010, no pet.) (mem. op.)( ("The value of lost patients, lost business contacts and collaborations, and lost hospital privileges are anything but fixed, settled, and indisputable. Rather, by their very nature, it is likely that Liming might never even be aware of specific patients and business contacts lost."); RenewData Corp. v. Strickler, No. 03-05-00273-CV, 2006 Tex. App. LEXIS 1689, 2006 WL 504998, at *15-16 (Tex. App.—Austin Mar. 3, 2006, no pet.) (mem. op.)("Because it is difficult to assign a dollar value to loss of customer goodwill and clientele, it constitutes an irreparable injury.") (citing Graham v. Mary Kay, Inc., 25 S.W.3d 749, 753 (Tex. App.—Houston [14th Dist.] 2000, pet. denied.). 3 At the hearing on Appellant’s Motion to Dismiss, his counsel confirmed that “[m]uch of the facts here are not in dispute in terms of what was said, what was done. The dispute is whether it was lawful or not...” Judge Aiken responded that “I have a pretty…difficult time saying that what your client has done should be lawful, it seems to me, at least that they’re all true, that they’re pretty outrageous. . .” (Record, Vol. 1, 88.)
31 Evidence was also presented that irreparable harm existed because Appellant
cannot respond in damages. He concedes that there is no adequate remedy at law
if the defendant is incapable of responding in damages. See Brief at 25; Bank of
Southwest v. Harlingen Nat'l Bank, 662 S.W.2d 113, 116 (Tex.App.—Corpus
Christi 1983, no writ). Evidence that a defendant is in financial distress and cannot
respond in damages is sufficient evidence to support injunctive relief. Surko v.
Borg-Warner, 782 S.W.2d 223 (Tex. App.—Houston [1st Dist.] 1989, no writ).
The only evidence in the record demonstrates that Appellant is deeply in
debt with limited, if any, income or other resources and could not adequately
respond in damages. (Statement of Facts ¶¶ 25-26.) Appellant valued the Gallery
in excess of $4.5 million based on revenue, not including Dunn’s and the Gallery’s
goodwill or the injury to Dunn’s health and reputation. (See Statement of Facts ¶¶
22-23.) Given that he is without assets, has a negative net worth, and earns no
more than $30,000 per year, Appellant is incapable of responding in damages.
(Id.)
4. ISSUE 4: Appellees Offered Evidence Establishing a Probable Right to Recovery
To show a probable right of recovery, Appellees must plead a cause of
action and present evidence that tends to sustain it. Camp v. Shannon, 162 Tex.
515, 348 S.W.2d 517, 519 (Tex. 1961); T-N-T Motorsports, 965 S.W.2d at 23-24.
Under the abuse of discretion standard, the evidence is reviewed in the light most
32 favorable to the court's ruling and deference is given to the trial court's resolution
of conflicting evidence. See IAC, Ltd. v. Bell Helicopter Textron, Inc., 160 S.W.3d
191, 196 (Tex. App.—Fort Worth 2005, no pet.); Wright v. Sport Supply Grp., Inc.,
137 S.W.3d 289, 292 (Tex. App.—Beaumont 2004, no pet.). A temporary
injunction is not overturned unless the trial court's action was so arbitrary that it
exceeded the bounds of reasonable discretion. EMSL Analytical, Inc. v. Younker,
154 S.W.3d 693, 696 (Tex. App.—Houston [14th Dist.] 2004, no pet.).
Here, Appellees pled claims for misappropriation under the Texas Uniform
Trade Secrets Act (Count I), tortious interference with business relations (Count
II), harmful access by computer (Count III), wiretapping violation (Count IV),
defamation and business disparagement (Count VI), and invasion of privacy
(Count VII). Dunn also presented a claim for intentional infliction of emotional
distress (Count VIII). Over the course of three days, Appellees presented evidence
to sustain each of these claims. The District Court considered the claims, reviewed
the evidence and weighed the credibility of the witnesses and properly found that
Appellees established a probable right of recovery.
a. Misappropriation and/or Disclosure of Trade Secrets.
Appellees established a probable right of recovery for misappropriation
and/or disclosure of trade secrets, and the District Court did not abuse its discretion
in enjoining Appellant from disclosing Confidential Information. (C.R. 259, ¶ 1.)
33 Under Texas law, misappropriation is established by showing that a trade
secret existed, was acquired through a breach of a confidential relationship or
discovered by improper means, and was used without authorization. Avera v. Clark
Moulding, 791 S.W.2d 144, 145 (Tex. App.—Dallas 1990, no writ); Alcatel USA,
Inc. v. DGI Tech., 166 F.3d 772, 784 (5th Cir. 1999). Here, the record reasonably
supports the finding of probable recovery.
The evidence established that Appellees spent substantial time, labor and
money to develop key business relationships and that the Gallery’s client lists,
client purchase history, and pricing information is confidential, including the
General Ledger. (Statement of Facts ¶ 2.) Appellant acquired the General Ledger
during the parties’ divorce proceedings for settlement purposes only and subject to
a confidentiality order. (Statement of Facts ¶ 3.) Absent this limited purpose,
Appellant would not have gained access to the General Ledger (Id.) That the
confidentiality order was later vacated or modified did not strip the General Ledger
of its confidential status or give the Appellant free license to disseminate Gallery
trade secrets. (Id.)
The evidence showed that the General Ledger was kept in confidence, gave
Dunn and the Gallery an advantage over its competitors, and was not publicly
available or known. (Id.) It included private and confidential business information
such as the identity of every vendor, client, and artist that transacted business with
34 the Gallery, including the purchase discounts negotiated with clients, invoice
charges and payments made by clients, commissions paid to individual artists, and
the Gallery’s profit margins. (Statement of Facts ¶ 3.)
There was evidence before the trial court that the Appellant used the General
Ledger—knowing that the information was not publicly available— to identify
Gallery clients and then target them with outlandish and offensive claims in an
effort to disrupt their business dealings with Dunn and the Gallery. The evidence
showed that Appellant claimed that client purchases and artist sales had caused his
father’s heart attack and characterized Dunn was a perjurer, adulterer, and
swindler. (Statement of Facts ¶¶ 3-7.) Given these outrageous circumstances, the
finding that an injunction should issue to maintain the status quo regarding the
General Ledger was not unreasonable.
Appellant first argues that the General Ledger is not a trade secret. In
essence, Appellant seeks a resolution on the merits, which is not the purpose of an
interlocutory appeal. In determining whether to grant trade secret protection
through a temporary injunction, a trial court simply determines whether the
information is entitled to trade secret protection pending the trial on the merits.
IAC, Ltd., 160 S.W.3d at 196.
Appellant next argues that he did not misappropriate the General Ledger
because he obtained it in discovery pursuant to a confidentiality agreement. As set
35 forth above, Appellant offers no evidence that a trade secret whose production is
compelled through discovery somehow loses trade secret protection.
There is, however, evidence that Appellant understood its confidential
nature—he acknowledged the information was not readily available to the public—
and used that information to Dunn and the Gallery’s commercial disadvantage.
Although evidence of actual misappropriation was before the trial court, Dunn and
the Gallery need not demonstrate before trial on the merits actual misappropriation.
Instead, "harm to the trade secret owner may be presumed when a defendant
possesses trade secrets and is in a position to use them." Id. There is no dispute
that Appellant possesses the General Ledger, has used and published its contents in
an attempt to harm Dunn and the Gallery, and continues to be in a position to use it
for this purpose absent a temporary injunction.
Finally, Appellant argues that temporary relief is not available because he
did not intend to misappropriate the Gallery’s confidential information but rather
was simply focused on interfering with Dunn’s membership on The Hockaday
School Board. Appellant’s expressed intent, however, is inconsistent with the
evidence. He not only sought to interfere with Dunn’s position on The Hockaday
School Board but the evidence also shows that he had repetitively misused and
broadcasted the Gallery’s confidential information, including the entire General
Ledger, in order to get artists and clients to cease transacting business with the
36 Gallery. Given that Appellant does not operate and is not affiliated with another
gallery, the evidence showed that his disclosures were not made for the purpose of
advancing his own competitive advantage but rather for the sole purpose of
causing harm to Dunn and the Gallery.
b. Tortious Interference with Business Relations.
The evidence also established a probable right to recover for tortious
interference. The trial court did not abuse its discretion when it enjoined
Appellants in Temporary Injunction ¶¶ 5-6 from interfering with existing or
prospective customers, artists, or employees by (a) using Confidential Information;
(b) using information obtained in violation of the Texas Harmful Access by
Computer Act; (c) using information that Appellant obtained by intercepting
private conversations between Dunn and other third parties in Appellant’s absence;
and/or (d) disclosing surreptitiously recorded conversations that occurred of Dunn
in the privacy of her residence. (C.R. 261, ¶¶ 5-6.)
1) The Evidence Confirms Appellant’s Tortious Interference with Existing Relationships.
The elements of tortious interference with an existing contract are: (1) an
existing contract subject to interference; (2) a willful and intentional act of
interference with the contract; (3) that proximately caused the plaintiff's injury; and
(4) caused actual damages or loss. See Prudential Ins. Co. of Am. v. Fin. Review
Servs., Inc., 29 S.W.3d 74, 77 (Tex. 2000). Appellees presented evidence of
37 existing contractual relationships (consignment agreements) with artists such as
David Bates, Trent Hancock, and Matthew Sontheimer. (Statement of Facts ¶¶ 8-
11.) They also presented evidence of existing at-will employment relationships
with employees Beth Taylor, the Gallery Director, and Meredith Leyendecker.
(Statement of Facts ¶ 12.)
The evidence showed that Appellant engaged in intentional acts of
interference with both artists and Gallery employees. (Statement of Facts ¶¶ 8-12.)
Appellant sent a letter to David Bates, the Gallery’s key artist, on March 31, 2014.
(Statement of Facts ¶¶ 9-10.) Both its context and content prove Appellant’s intent
to interfere. Appellant timed his missive to arrive in advance of a Bates exhibition
scheduled at the Gallery for April 5, 2014. (Id.) At this exhibition, Mr. Bates’
paintings and sculpture were being offered for sale pursuant to the consignment
agreement between Mr. Bates and the Gallery. (Id.)
In his letter, Appellant seeks—based on false and misleading statements—to
interfere with or terminate the consignment agreement between Mr. Bates and the
Gallery by the following argument:
Dunn is a bad actor who is harming Appellant (i.e., she committed
perjury, caused harm and financial ruin to Appellant and his family,
and deprived him of his fair share of the Gallery);
38 But for the revenue generated from the sale of Mr. Bates’ artwork,
Dunn would not have the financial ability to inflict this harm;
Appellant made amends with Lisa Brown, a competitive art
consultant, and he encourages Mr. Bates to contact Ms. Brown and
“make amends.”
The timing and content of this letter evidences an effort to interfere with the
upcoming exhibition at the Gallery pursuant to the consignment agreement
between Mr. Bates and the Gallery. Its explicit purpose is to disrupt the exhibition
and stop the Gallery’s sales of Mr. Bates’ artwork that he views as funding his
misfortune (“[y]our upcoming show could provide enough financial ammunition to
continue this attack permanently.”). (Statement of Fact, ¶ 9.) He invites the
Gallery’s key artist to contact a competitive art consultant and “make amends,” the
clear import being to allow Ms. Brown to sell his art, thus providing evidence for
the trial court to issue an injunction prohibiting tortious interference to divert
artists to another art dealer. (Id.)
With Mr. Bates, Appellant intended to interfere with an existing contractual
relationship. While he was unsuccessful at derailing the Bates’ exhibition, Dunn
testified that since his interference, her relationship with Mr. Bates has materially
changed. (Statement of Facts ¶ 10.) No independent tort (or other unlawful act)
39 need be shown to warrant enjoining Appellant from continuing to interfere with the
Gallery’s existing consignment agreements.
Even if viewed as a prospective business relation, the interference was
independently tortious and in violation of law. Appellant used and disclosed
confidential financial information (i.e., gross and net gallery revenue). (Statement
of Facts ¶ 9.) He relied on the General Ledger – a protected trade secret – to argue
that this artist provided “most of the funding” for the “massive harm” to him and
his family. (Statement of Facts ¶ 9)(“that is very clear from looking at the gallery
ledger”). Thus, Defendant violated Section 134A.002(3) of the Texas Uniform
Trade Secrets Act (twice) in pursuing this interference.4
Next, Appellant claimed that Dunn made “fabricated allegations of
violence” in an affidavit submitted in their divorce proceedings and as a result, he
suffered “excruciating torture.” (Statement of Facts ¶¶ 9.) Appellant accused Dunn
of both dishonesty and perjury, a criminal act. See Penal Code, §§ 37.02 (Perjury)
and 37.03 (Aggravated Perjury). These statements, on their face, tend to injure
Dunn’s reputation and to impeach her honesty, integrity, virtue, or reputation as
provided in Section 73.001 of the Civil Practice and Remedies Code. See, e.g.,
Main v. Royall, 348 S.W.3d 318, 390 (Tex. App.—Dallas 2011, no pet.)
4 Appellant independently violated Section 31.05 of the Penal Code that prohibits one from knowingly communicating or transmitting a trade secret without the owner’s effective consent. See Texas Penal Code, § 31.05(b)(3). As a third degree felony, this offense qualifies as an “unlawful act” for purposes of a tortious interference with a prospective business relationship.
40 (unambiguously charging one with a crime or dishonesty is defamatory per se).
Appellant’s attribution of perjury is an accusation of a criminal act and constitutes
defamation per se.
Appellant’s efforts were not limited to Mr. Bates. He targeted other artists
as well. Regarding Trent Hancock, the trial court heard evidence that Appellant
repeated allegations of dishonesty and perjury to him and alleged that Dunn
engaged in infidelity/sexual misconduct, which are not only intentional acts but
also constitute defamation per se. (Statement of Facts ¶ 11.) In addition,
Appellant forwarded to artists, including Trent Hancock, and Gallery employees
text messages he obtained in violation of the Texas Harmful Access by Computer
Act. (Id.)
The trial court heard evidence that after receiving Appellant’s defamatory
barrage, Hancock discontinued his relationship with the Gallery. (Statement of
Fact ¶ 11.)5 This evidence tends to show that Appellant’s tortious interference—
whether through the misappropriation of confidential information, defamatory
statements, invasions of privacy, or violations of state statute—has disrupted and,
5 Appellant complains that Dunn did not prove that he had successfully caused any artist to terminate a consignment agreement as a result of Appellant’s interference. (Brief at 43.) The trial court, however, heard evidence that two Gallery artists terminated their relationships with the Gallery following contact with Appellant. (Statement of Facts ¶ 11.) While Appellant once again focuses on the merits of the litigation and not the limited purpose of maintaining the status quo pending trial, he did not deny contacting these artists, publishing defamatory statements to them, or their termination of their business relationship with the Gallery thereafter.
41 if not enjoined, will continue to disrupt or impair the Gallery’s relationships with
artists. (Statement of Fact ¶ 8.)
The evidence also showed that Appellant interfered with the employment
relationships between the Gallery and its employees. (Statement of Facts ¶ 12.)
Defendant sent a letter, documents, and unauthorized recordings to Beth Taylor,
the Gallery Director. (Id.) He contacted Taylor for the sole purpose of disrupting
the professional relationship that Appellees have had with Taylor for nearly twenty
(20) years. (Id.) He sent a similar letter to the parents of Meredith Leyendecker,
another Gallery employee, soliciting their assistance in persuading Ms.
Leyendecker to end her employment at the Gallery. (Id.)
An at-will employment agreement can be the subject of a claim of tortious
interference with contract. Sterner v. Marathon Oil Co., 767 S.W.2d 686, 688
(Tex. 1989). Until terminated, the at-will contract is valid and subsisting, and third
persons such as the Appellant are not free to tortuously interfere with it. Id.
Absent an intent to harm Dunn and the Gallery, Appellant has offered no
justification for his efforts to cause the termination of the Gallery’s employment
relationships.
2) The Evidence Confirms Appellant’s Tortious Interference with Prospective Relationships.
Appellees also submitted evidence establishing the elements of their claims
for tortious interference with prospective and continuing business relationships.
42 The elements of this claim are: (1) a reasonable probability that the parties would
have entered into a business relationship; (2) an intentional, malicious intervention
or an independently tortious or unlawful act performed by the defendant with a
conscious desire to prevent the relationship from occurring or with knowledge that
the interference was certain or substantially likely to occur as a result of its
conduct; (3) a lack of privilege or justification for the defendant's actions; and (4)
actual harm or damages suffered by the plaintiff as a result of the defendant's
interference. See Tex. Disposal Systems Landfill, Inc. v. Waste Mgmt. Holdings,
Inc., 219 S.W.3d 563, 590 (Tex. App.—Austin 2007, pet. denied) (citing Bradford
v. Vento, 48 S.W.3d 749, 757 (Tex. 2001).
Appellees showed that Appellant’s tortious conduct is actionable as
defamation, business disparagement, invasion of privacy and intentional infliction
of emotional distress. Defamation is generally defined as the invasion of a person's
interest in her reputation and good name. Hancock v. Variyam, 400 S.W.3d 59, 63-
64 (Tex. 2013)(citing W. Page Keeton et al., Prosser & Keeton on Torts § 111, at
771 (5th ed. 1984 & Supp. 1988)); see also Tex. Civ. Prac. & Rem. Code § 73.001.
It is either defamation per se or per quod. Id.
Historically, defamation per se has involved statements that are so obviously
hurtful to reputation that the jury may presume general damages, including for loss
of reputation and mental anguish. Publications are libel per se if they include
43 statements that (1) charge a crime, dishonesty, fraud, rascality, sexual misconduct
or general depravity, or (2) are falsehoods that injure one in her office, business,
profession, or occupation. See, e.g., Main, 348 S.W.3d at 390. Here, the evidence
established that Appellant’s statements made to Gallery artists, clients and
employees charged Dunn with a crime (perjury), dishonesty, unfair business
dealings, and fraud. They were falsehoods that tend to injure her business and
occupation and are actionable under a claim for defamation.
The imputation of sexual misconduct, such as adultery, is defamatory per se
under Texas law. Shipp, 439 S.W.3d at 440; Levine v. Steve Scharn Custom
Homes, Inc., 448 S.W.3d 637, 650 (Tex. App.—Houston [1st Dist.] 2014, pet.
denied); Tex. Disposal Sys. Landfill, Inc. v. Waste Mgmt. Holdings, Inc., 219
S.W.3d 563, 581 (Tex. App.—Austin 2007, pet. denied). Section 73.001 of the
Civil Practices and Remedies Codes captures statements that tend to impeach one’s
virtue. See Neely 418 S.W.3d at 52. Here, Appellant admitted he lacked not only
proof but even a good faith belief of an affair. (Statement of Facts ¶ 10.) In
contrast, Dunn was unequivocal in her denial of any infidelity or misbehavior. (Id.)
His statements contain clear innuendo of adultery, conclusions that are false,
misleading, and defamatory. (Id.)
Appellant next argues that the Temporary Injunction is overbroad with
respect to the identity of customers and/or artists. Where confidential customer
44 information is one of the main assets to be protected, public disclosure of the
private information is not necessary. See Cottingham v. Engler, 178 S.W.2d 148,
151 (Tex. Civ. App.—Dallas 1944, no writ). Courts do not find it unreasonable to
assume that he who is sought to be enjoined is sufficiently familiar with the
business and its customers to avoid violating the injunction. See Cottingham, 178
S.W.2d at 151. Even when the names of some customers are in evidence, the trial
court may enjoin as to all customers. See Collins v. Ryon's Saddle & Ranch
Supplies, Inc., 576 S.W.2d 914, 915 (Tex. Civ. App.—Fort Worth 1979, no writ).
Here, Appellant possesses the General Ledger that lists the clients and artists of the
Gallery. There is no ambiguity as to their identity or the scope of the injunction.
c. Harmful Access by Computer Violation.
The evidence conclusively established a violation of the Harmful Access by
Computer Act. Tex. Civ. Prac. & Rem. Code § 143.001. Defendant admitted that
he accessed Dunn’s phone and took pictures of private text messages without her
knowledge or consent. The District Court did not abuse its discretion in issuing
Temporary Injunction ¶ 2 injunction, prohibiting the disclosure of any emails,
voice mail messages, text messages, phone logs or other data originating from
Dunn’s mobile or smart phone that were obtained in violation of state law. (C.R.
260, ¶ 2.)
45 d. Texas Wiretapping Violation.
Likewise, the evidence conclusively established a violation of Section
123.001(2) of the Interception of Communications Act (ICA). The evidence
showed that Appellant placed a hidden digital recorder in Dunn’s car and recorded
communications and phone conversations in which he was not a party. (Statement
of Facts ¶ 19.) These activities violate Section 123.001(2) of the ICA. While he
now claims that he does not recall whether he retains those recordings, even if now
destroyed, Dunn testified that she reviewed a detailed log that he prepared when he
transcribed those recorded conversations. (Id.). Dunn has adequately shown a
violation of the ICA and may recover $10,000 for each violation, a remedy that
Appellant is not financially solvent to answer. The existence of the transcriptions
confirms the unlawfully obtained recordings and supports the trial court’s
injunction against publication of them.
e. Defamation and Business Disparagement.
To maintain a cause of action for defamation, the plaintiff must prove that
the defendant: (1) published a statement; (2) that was defamatory concerning the
plaintiff; (3) while acting with either actual malice, if the plaintiff was a public
figure, or negligence, if the plaintiff was a private individual, regarding the truth of
the statement. WFAA-TV, Inc. v. McLemore, 978 S.W.2d 568, 571 (Tex. 1998);
Glenn v. Gidel, 496 S.W.2d 692, 697 (Tex. Civ. App.—Amarillo 1973, no writ)
46 (elements of slander). To prevail on a business disparagement claim, a plaintiff
must establish that (1) the defendant published false and disparaging information
about it, (2) with malice, (3) without privilege, (4) that resulted in special damages
to the plaintiff. Forbes Inc. v. Granada Biosciences, Inc., 124 S.W.3d 167, 170, 47
Tex. Sup. Ct. J. 162 (Tex. 2003); Hurlbut v. Gulf Atl. Life Ins. Co., 749 S.W.2d
762, 766, 31 Tex. Sup. Ct. J. 144 (Tex. 1987).
As discussed in Issue 1, the record contained evidence that Appellant had
made false, misleading, and defamatory statements regarding Dunn. The trial
court did not err when it found a probable right to recovery on the defamation
claim or entered a narrow injunction to maintain the status quo pending a trial on
the merits. (C.R. 261, ¶ 7.)
Appellant nevertheless contends that the evidence is insufficient to show a
probable right of recovery. But since the standard of review is to "draw all
legitimate inferences from the evidence in the light most favorable to the trial
court's judgment," these factual insufficiency points are not proper grounds for
review. Keystone Life Ins., 687 S.W.2d at 91. In the light most favorable to the
trial court’s judgment, Appellant published statements that Dunn is a perjurer,
adulterer, and swindler which the evidence confirmed were false, misleading, and
defamatory. (See, Issue 1, above.) Plaintiffs are not required to show evidence of
47 damages given that his statements are defamatory per se and presumed to injure
Dunn’s reputation.
f. Invasion of Privacy
The evidence showed that Appellee surreptitiously recorded Dunn’s private
conversations without her knowledge or consent. (Statement of Facts ¶ 17, C.R.
260-262, ¶¶ 4-7.) To sustain an invasion of privacy claim, three elements are
necessary: (1) an intentional intrusion; (2) upon the seclusion, solitude or private
affairs of another; (3) which would be highly offensive to a reasonable person.
Blanche v. First Nationwide Mortg. Corp., 74 S.W.3d 444, 455 (Tex. App.—
Dallas 2002, no pet.). In essence, Appellant claims that because they were
married, he has the legal right to invade her privacy, secretly record her in their
home and bedroom, selectively edit those conversations and then distribute the
recordings to the public in an effort to harm Dunn’s reputation and business. Id.
It is undisputed that the intrusion occurred. Appellant made the recordings
without Dunn’s knowledge or consent. It is also undisputed that the recordings
were made in the privacy of their home. A spouse shares equal rights in the
privacy of the bedroom, and nothing suggests that the right of privacy is limited to
unmarried individuals. Clayton v. Richards, 47 S.W.3d 149, 155 (Tex. App.—
Texarkana 2001)(videotaping spouse in privacy of bedroom without their
knowledge invades spouse’s privacy); see also Collins v. Collins, 904 S.W.2d 792,
48 797 (Tex. App.—Houston [1st Dist.] 1995), writ denied per curiam, 923 S.W.2d
569 (Tex. 1996)(statutory violation of the prohibition against the use of illegally
intercepted telephonic communications)
The evidence also satisfied the third element. A recording surreptitiously
made in a place of privacy at a time when the individual believes that he or she is
in a state of complete privacy can be highly offensive to an ordinary reasonable
person. Clayton, 47 S.W. 3d at 155. Taping “without consent or awareness when
there is an expectation of privacy goes beyond the rights of a spouse because it
may record private matters, which could later be exposed to the public eye. . . .” Id.
Having established a probable right of recovery, Dunn presented evidence
that she will suffer irreparable harm if Appellant is permitted to continue to
disclose recordings made from that intrusion. (Statement of Fact ¶ 20.)
Appellant’s claimed “right” to distribute statements extracted and edited from
private conversations recorded without Dunn’s consent or knowledge do not trump
Dunn’s right to privacy.
Because Appellant has previously published those conversations, Appellees
established a prima facie case for injunctive relief enjoining him from making the
same disclosures in the future that he has admitted making in the past.6 There are
6 Appellant suggests to this Court that the recordings have been published to only 10 people. Following the close of the evidence at the temporary injunction hearing, Appellant posted the audio clips on a website www.therealtd.com and attempted to drive traffic to that website
49 no prior restraint concerns at play here. While Appellant complains that Dunn will
not ultimately prevail at trial, this gripe does not establish an abuse of discretion.
B. The District Court’s Award of Attorneys’ Fees for Appellant’s Motion to Dismiss Should Not Be Set Aside.
The trial court made two rulings in its March 18, 2015 Order Denying
Defendant’s Motion to Dismiss: (1) the Motion to Dismiss was denied; and (2) the
Motion to Dismiss was frivolous so that courts costs and reasonable attorneys’ fees
were awarded. (Supplemental C.R. 248-249.) The only issue presented for review
is the second ruling, “[w]hether the trial court erred by awarding attorneys’ fees to
Appellees in opposing [Appellant’s] motion to dismiss.” Brief at 3.
1. ISSUE 5: The Trial Court Did Not Abuse its Discretion When it Determined that Plaintiff’s Motion was Frivolous and Awarded Fees.
The trial court properly awarded attorneys’ fees after finding that
Appellant’s motion to dismiss was frivolous. Appellant filed a Motion to Dismiss
under TEX. CIV. PRAC. & REM. CODE § 27.003(a) claiming that he had met his
evidentiary burden to show that Dunn was a “public figure” or that this matter was
otherwise appropriately decided under the anti-SLAPP statute.
A hearing was held on March 16, 2015. At the time of the hearing, the trial
court had entered an injunction finding Appellees had established a probable right
through public postings on his Facebook page. Appellant notes on the public website that he took the audio clips down only because the District Court enjoined him from doing so and states that he intends to republish them to the public as soon as possible.
50 to recovery on the claims challenged in the Motion to Dismiss. Appellant
nevertheless pressed forward, claiming that he had met his burden to show the
statute applied and that Appellees had failed to establish a prima facie case on
claims that the court had already ruled that a probable right of recovery exists.
Judge Aiken observed that advancing the argument that Appellees claims are
frivolous after the trial court ruled that they had a probable right of recovery
“disturbs me more than anything else at this point. And also it would seem to
conflict, also, with Rule 13, as well.” (R.R. Volume 1, Motion to Dismiss, 77.)
Other disturbing issues were raised to the trial court during the hearing. For
example, Appellant offered no evidentiary support and cited no authority in his
briefing or before the trial court to support the claim that the lawsuit involved a
“matter of public concern.” (R.R., Volume 1, Motion to Dismiss, 41-44.) In fact,
Appellant misrepresented to the trial court that no cases have considered who
qualifies as a “public figure” under the Texas statute. (Id. at 20.) In fact, as
Appellees pointed out at the hearing, not only does the jurisprudence on “public
figure” date back to at least the 1964 Supreme Court New York Times v. Sullivan,
376 U.S. 254 (1964) case, this Dallas Court of Appeals addressed the very issue
under the TCPA in 2014. See Pickens v. Cordia, 433 S.W.3d 179 (Tex. App.—
Dallas 2014, no pet.). In a case where Appellant argued that Dunn was a public
figure and claimed the absence of any guiding precedent, the trial court then
51 learned that this Dallas Court of Appeals had determined just last year that T.
Boone Pickens was not a public figure for purposes of the TCPA. (R.R. Volume 1,
Motion to Dismiss, 56-57.)
Appellant also failed to identify which causes of action brought by
Appellees relates to the so-called right to petition. (Id. at 45-46.) In advancing his
claims that Appellees’ causes of action were frivolous, Appellant did, however,
seek to block the 500 pages of testimony and evidence adduced over the three-day
temporary injunction hearing. (Id. at 3). Because Appellant offered no evidence
of a “public concern” and failed to meet his initial burden of proof under the
statute, no obligations for Appellees were triggered.
In filing the Motion to Dismiss and the Amended Motion to Dismiss,
Appellant’s counsel certified that the legal contentions were warranted by existing
law—but cited no authority—or advanced a non-frivolous argument for the
extension, modification, or reversal of existing law or the establishment of new
law. The trial court did not abuse its discretion in determining that this
certification was false, that Appellant did not cite controlling authority to the trial
court, and that Appellant advanced troubling arguments regarding the frivolous
nature of the claims in light of the Temporary Injunction. In other words, the
district court clearly set forth in its Order and at the hearing the basis for the
sanctions.
52 Accordingly, Appellees’ request for reasonable expenses and attorneys’ fees
in opposing the Motion to Dismiss and Amended Motion to Dismiss was within
the discretion of the trial court to award under Section 10.002 of the Texas Civil
Practice and Remedies Code.
2. Appellant Waived Any Right to Appeal the Order Denying the Motion to Dismiss.
Appellant’s Prayer for relief requests that the “Order denying [Appellant’s]
motion to dismiss and awarding attorneys’ fees to Appellees be reversed.” (Brief
at 54, emphasis added.) Appellant waived any issue that the Order denying the
Motion to Dismiss should be considered on appeal.
To present an issue to this Court, a party's brief shall contain, among other
things, a concise, non-argumentative statement of the facts of the case, supported
by record references, and a clear and concise argument for the contentions made
with appropriate citations to authorities and the record. TEX. R. CIV. P. 38.1;
McIntyre v. Wilson, 50 S.W.3d 674, 682 (Tex. App.—Dallas 2001, pet. denied).
An issue on appeal unsupported by argument or citation to any legal authority
presents nothing for the Court to review. Birnbaum v. Law Offices of G. David
Westfall, 120 S.W.3d 470, 477 (Tex. App.—Dallas 2003, pet. denied).
When a party fails to adequately brief a complaint, he waives the issue on
appeal. In re N.E.B., 251 S.W.3d 211, 212 (Tex. App.—Dallas 2008, no pet.).
Bare assertions of error, without argument or authority, are insufficient to preserve
53 error for our review. See Sullivan v. Bickel & Brewer, 943 S.W.2d 477, 486 (Tex.
App.—Dallas 1995, writ denied). Here, other than a request for relief in the
Prayer, Appellant does not make even “bare assertions of error” regarding the
Order Denying the Motion to Dismiss so that any issue, if later raised on appeal, is
waived.
VIII. PRAYER
For the reasons stated above, Dunn and the Gallery respectfully request that
the Court affirm the District Court’s temporary injunction and order awarding
attorneys fees related to Appellant’s Motion to Dismiss.
JACKSON LEWIS P.C. 500 N. Akard Street, Suite 2500 Dallas, Texas 75201 PH: (214) 520-2400 FX: (214) 520-2008
By: /s/ Dan Hartsfield Dan Hartsfield State Bar No. 09170800 dan.hartsfield@jacksonlewis.com Talley Parker State Bar No. 24065872 talley.parker@jacksonlewis.com
54 CERTIFICATE OF COMPLIANCE
I certify that this computer-generated brief contains 10,946 words.
/s/ Dan Hartsfield Dan Hartsfield
CERTIFICATE OF SERVICE
I certify that a true and correct copy of the foregoing document was served on counsel for Appellant Bradley Miller on August 3, 2015.
/s/ Dan Hartsfield Dan Hartsfield
Bradley B. Miller v. Talley Dunn Gallery, LLC and Talley Dunn (Bradley B. Miller v. Talley Dunn Gallery, LLC and Talley Dunn) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.