EJ Madison, LLC., a Texas Limited Liability Company v. Pro-Tech Diesel, Inc.

Opinion

ACCEPTED 08-17-00229-CV 08-17-00229-CV EIGHTH COURT OF APPEALS EL PASO, TEXAS 5/21/2018 11:53 PM DENISE PACHECO CLERK

IN THE COURT OF APPEALS EIGHTH DISTRICT OF TEXAS EL PASO, TEXAS FILED IN 8th COURT OF APPEALS

_____________________________________________________

EL PASO, TEXAS 5/21/2018 11:53:56 PM 08-17-00229-CV NO. 08-17-00229-CV DENISE PACHECO Clerk

EJ MADISON, LLC.

v.

PRO-TECH DIESEL, INC.

_____________________________________________________

TH Appealed from the 205 205TH Judicial District Court of El Paso County, Texas

_____________________________________________________

BRIEF OF APPELLANT

_____________________________________________________

Troy C. Brown Texas Bar No. 00783735 300 E. Main 10th Floor, 10th Floor, Suite Suite 100 El Paso, Texas 79901 Tel. 915-543-9669 Fax 888-922-3353 troy@tcblegal.com Attorney for Appellant

ORAL ARGUMENT NOT REQUESTED

IDENTITIES OF PARTIES AND COUNSEL

Appellant Attorneys for Appellant EJ Madison, LLC Troy C. Brown 300 E. Main 10th Floor, Suite 1000 El Paso, Texas 79901 Tel. 915-543-9669 Fax 888-922-3353 troy@tcblegal.com

Appellee Attorney for Appellee Pro-Tech Diesel, Inc. Mannie Kalman Mounce, Green, Myers, Safi, Paxson & Galatzan, P.C. 1214 Montana Avenue El Paso, TX TX 79901 mkalman@manniekalman.com

Additional parties in trial court (not parties on appeal)

None

Trial Court Judge: Hon. Guadalupe Rivera 205TH Judicial District Court 205Th El Paso County, Texas

i

TABLE OF CONTENTS

IDENTITIES OF PARTIES AND COUNSEL ..........................................................i

TABLE OF CONTENTS .......................................................................................... ii

INDEX OF AUTHORITIES.....................................................................................iv

STATEMENT OF THE CASE ............................................................................... vii

ISSUES PRESENTED ........................................................................................... viii

STATEMENT OF FACTS ........................................................................................ 1

SUMMARY OF THE ARGUMENT ......................................................................13

ARGUMENT AND AUTHORITIES ......................................................................14

I. Standard of review. .............................................................................................. 7

II. There is legally legally and factually factually insufficient insufficient evidenceevidence to support the court's court’s lack of lack of finding finding that that the theintroduction introduction of of EL ELHollingsworth Hollingsworth to to Pro-Tech Pro-Tech constituted disclosure constituted disclosure of EJ Madison's Madison’s confidential confidential information to Pro-Tech. Pro-Tech.

[Amended finding No. 3] ..................................................................................... 17

III. There is legally and factually factually insufficient insufficient evidence evidence to support the court's court’s “Project” was the basis of the Agreement. ...... 17 factual finding No. 6 that the "Project"

IV. There is legally and factually factually insufficient evidence evidence to support the court's court’s factual finding No. 7 that the language of the Agreement does not reflect that services not related to the conversion process constituted trade secrets ........ 17

There is legally V. There legally and and factually factually insufficient insufficient evidenceevidence to support support the court's court’s factual finding No. 8 that that there there was was no no additional additional consideration consideration provided by Plaintiff to Defendant that would make non-"Project" non-“Project” services covered by the Agreement ............................................................................................................. 17

V. The The trial court erred by granting granting Appellee's Appellee’s Plea to the the Jurisdiction Jurisdiction that Appellant failed to bring suit in time ................................................................. 17

ii

factually insufficient evidence VI. There is legally and factually evidence to support the court's court’s factual finding factual finding No. that the No. 9 that theservices services provided provided by by Defendant Defendant E.L. E.L.

Hollingsworth are Hollingsworth are those those known known in the industry, industry, e.g., oil oil changes, changes, windshield windshield wiper replacements, and wiper replacements, and do not constitute do not constitute trade trade secrets secrets nor nor confidential confidential information as intended by the Agreement ......................................................... 17

VII. There is legally and factually insufficient evidence evidence to support the court’s court's factual finding No. 10 that Plaintiff did not provide Defendant with a written copy of its customer list and EL Hollingsworth is not a customer of Plaintiff 18

VIII. There is legally and factually insufficient evidence to support the court’s court's factual finding factual finding No.

No. 1111 that Plaintiff isis not that Plaintiff entitled to not entitled any of to any of the the profits profits generated by Defendant generated Defendant for for non-"Project"

non-“Project” services services Defendant Defendant provided provided to E.L. Hollingsworth .................................................................................................18

IX. There is legally and factually insufficient evidence to support the court's court’s attorney's fees ..................................29 finding no. 12 that Plaintiff did not incur attorney’s

legally and X. There is legally and factually factually insufficient insufficient evidenceevidence to support support the court's court’s finding No. 12 that lack of finding that Plaintiff Plaintiff alleged alleged its entitlement entitlement to attorney's attorney’s fees, and the parties and parties agreed agreed that that attorney's attorney’s fees would be proven fees would proven in aa separate separate [Amended No. 12] ..................................................................................30 hearing. [Amended

XI. TheThe court court erred erred as as a matter matter of law in its of law its conclusion conclusion of of law law no. no. 1 thatthat Defendant did not breach the Non-Disclosure Non Circumvention Agreement ..................................................................................................................................30

XII. The The court court erred erred as as aa matter matter of of law law in failing to in failing to find, find, or or in its lack lack of finding, that finding, Defendant’s failure that Defendant's failuretoto turn over the turn over the profits, profits, benefits benefits and and proceeds of proceeds its commercial of its commercial relationship relationship with EL Hollingsworth with EL Hollingsworth does does not not constitute breach breach of of fiduciary fiduciaryduty. [Additional no. 6] ....................................31 duty. [Additional

court erred XIII. The court erred as as a matter matter of law in its conclusion conclusion of of law law no. 2 that that there is no there no language language in inthetheNon-Disclosure Non-Disclosure Non NonCircumvention Circumvention Agreement Agreement reflecting an intent that services not related to nor arising from the conversion process constitute process constitute trade secrets or trade secrets or confidential confidential financial financial and and business business information .............................................................................................................31

XIV. The court erred as a matter of law in its conclusion of law no. 3 that the Non-Disclosure Non Circumvention Agreement terms of the Non-Disclosure Agreement did not prohibit iii

Defendant from entering into a business relationship with E.L. Hollingsworth to provide mechanical services unrelated to the conversion process ...............31

XV. The XV. The court court erred erred asas a matter matter of law in its of law its conclusion conclusion of of law law no. no. 4 thatthat Plaintiffs’ trade secrets or confidential financial and Defendant did not utilize Plaintiffs' business information business informationin in entering entering into business relationship into a business relationship with with E.L. E.L.

Hollingsworth to provide mechanical services ....................................................31

XVI.The court XVI.The court erred erred as as aa matter matter of of law law in conclusion of in its conclusion of law law no.

no. 5 that that Plaintiff’s claim for breach of contract fails for lack of consideration .............31 Plaintiff's

XVII. The court erred as a matter of law in its conclusion of law no. 6 that the alleged trade secret information was readily ascertainable ascertainable by proper means, such as availability in trade journals, reference books, or published materials ................................................................................................................................ 34

XVIII.The court erred as a matter of law in its conclusion of law no. 7 that the alleged proprietary information was not substantially secret ...........................34

XIX.The court XIX.The court erred erred as as aa matter matter of of law law in conclusion of in its conclusion of law law no. no. 8 thatthat Plaintiff is not entitled to any damages, actual or punitive ..............................35

35

XX. The XX. The court court erred erred as as a matter matter of law in its of law its conclusion conclusion of of law law no. no. 9 thatthat Pursuant to Pursuant to §38.001 §38.001 et et seq., Tex. Civ.

seq., Tex. Civ. Prac.

Prac. & Rem. Rem. Code, Code, Plaintiff Plaintiff is not attorney's fees.........................................................................................

entitled to attorney’s

PRAYER and CERTIFICATE OF SERVICE.........................................................

SERVICE 37

APPENDIX:

Judgment (August 3, 2017) (Ex. A)

iv

INDEX OF AUTHORITIES

Cases

Nat'l Ins. Co. v. Paul, 927 S.W.2d American Nat’l S.W.2d 239, 239,245 245(Tex.

(Tex.App.—Austin App.-Austin 1996, writ denied) ...........................................................................................................32

32

Ames v. Ames, 776 S.W.2d 154, 158-159 (Tex. 1989), cert. denied, 494 U.S. 1080, 110 S.Ct. 1809, 108 L. Ed. 2d 939 (1990) ...........................................................15

15

14

Anderson v. City of Seven Points, 806 S.W.2d 791, 794 (Tex. 1991) .....................14

Austin Hardwoods, Inc. v. Vanden Berghe, 917 S.W.2d S.W.2d 320, 320,322 322(Tex.

(Tex.App.—El App.-E1 Paso 1995, writ denied) ..................................................................... 16, 17, 18, 31 Besing v. Moffit, 882 S.W.2d S.W.2d 79, 79, 81-82 81-82(Tex.

(Tex.App.—Amarillo 1994, no writ) ......14 App.-Amarillo 1994, 14 Cain v. Bain, 709 S.W.2d 175, 176 (Tex. 1986) .....................................................16

16

Catalina v. Blasdel, 881 S.W.2d 295, 297 (Tex. 1994) ...........................................14

14

Cent. Ready Mix Concrete Co. v. Islas, 228 S.W.3d 649, 651 (Tex. 2007) ............16

16

City of Keller v. Wilson, 168 S.W.3d 802, 807, 827 (Tex. 2005) ............................16

16

Estate of Judd, 8 S.W.3d 436 436 (Tex.

(Tex. App.—El Paso 1999, App.-E1 Paso 1999, no pet.) 14 pet.).........................14

15

Ford Motor Co. v. Castillo, 444 S.W.3d 616, 620 (Tex. 2014) (op. on reh'g)........15

Hydrocarbon Management, Inc. v. Tracker Exploration, Inc., 861 S.W.2d 427, 431 (Tex. App.—Amarillo 1993, no App.-Amarillo 1993, no writ) ............................................................... 16, 31

(Tex.App.-El Paso 1999, no pet.) ............ 14, 15 In re Estate of Judd, 8 S.W.3d 436 (Tex.App.-E1

King's Estate, 150 Tex. 662, 664-65, 244 S.W.2d 660, 661 (1951)......... 14,16 In re King’s

Kaye/Bassman Intern. Corp. v. Help Desk Now, Inc., 321 S.W.3d 806, 814 (Tex.App.-Dallas 2010, pet. denied) ....................................................................29

29

MBM Fin. Corp. v. Woodlands Operating Co., 292 S.W.3d 660, 663 n.3 (Tex.

14

2009) .....................................................................................................................14

v

Mclemon v. Dynegy Inc., 347 S.W.3d 315 (Tex. (Tex. App.—

App.—HoustonHouston [14th Dist.] 2011, no pet.) ..................................................................................................................29

29

Runnels v. Firestone, 746 S.W.2d 845, 849 (Tex.

(Tex. App App—Houston —Houston [14th Dist.], writ denied, 760 S.W.2d 240 (Tex. 1988) ...................................................................14

14

Timmons v. Luce, 840 S.W.2d 582, 586 (Tex. App.—Tyler 1992, no writ) ...........14

14

Uniroyal Goodrich Tire Co. v. Martinez, 977 S.W.2d 328, 334 (Tex. 1998), cert cert. denied, 526 U.S. 1040 (1999)...............................................................................15

15

Vickery v. Commission for Lawyer Discipline, 5 S.W.3d 241, 254 (Tex.App.—

Houston [14th Dist.] 1999, pet. denied) ........................................................ 20, 33

Watson v. Prewitt, 159 Tex. 305, 305, 320 S.W.2d 815, 816 (1959) ......................16

16

Zac Smith & Co. v. Otis Elevator Co., 734 S.W.2d 662, 666 (Tex. 1987) .............15

15

Statutes

Tex. Civ. Prac. & Rem. Code § 134A.002(6).

134A.002(6) .........................................................28

Rules

Tex. R. App. P. 43.3................................. ................................................................. 16

Tex. R. Civ. Proc. 93(9) ........................... .................................................................29

vi

STATEMENT OF THE CASE

This aa suit This suitfor forbreach breachofof a Non-Disclosureand a Non-Disclosure andNon-Circumvention Non-Circumvention

Agreement. Appellant, Agreement. Appellant, EJ EJ Madison, Madison, LLC, LLC, alleged alleged claims claims for breach breach of contract, contract,

breach of fiduciary breach fiduciary duty and and misappropriation misappropriation of trade secrets of trade secrets under the Texas Texas

Uniform Trade Uniform Trade Secrets SecretsAct Act(“TUTSA”).

("TUTSA"). (CR (CR I,I, 22). The parties 22). The parties tried tried the the case case

nonjury on June 20, 2017 and which time the trial court rendered judgment for the

On August defendant. On August 3, 3, 2017, the trial court entered entered judgment.

judgment. (CR I, 28).

On August August 23, 2017, Appellant Appellant filed filed its Request Request for Findings Findings of Fact and

Conclusions of Law and on August 30, 2017 its Motion for New Trial. (CR I, 29, Conclusions

31). On 31). OnSeptember September 19, 19, 2017, 2017, in in absence absence of of findings findings by the trial trial court court (due by

September 12, 2017), Appellant September Appellant filed filed its its Notice Notice of Past Due Findings of Fact and

Conclusions of of Law.

Law. (CR I, 33).

On November 1, 2017, Appellant Appellant filed filed its its Notice Notice of of Appeal.

Appeal. (CR I, 35).

On March 8, 2018, the trial court filed its Findings of Fact and Conclusions

of Law, and on March 19, 2018, Appellant filed its Request for Amended Findings

Law.1 (CR of Fact and Conclusions of Law.1 (CR II, 4, 8).

1 1 On January 26, 2018, in the absence of the filing of findings of fact and conclusions of the trial law by the trial court, court, Appellant Appellant filed filed its its Opposed Opposed Motion Motion to to Abate Abate Appeal, Appeal, Alternatively, Alternatively, to Extend Time Extend Time to File Appellant’s Appellant's Brief which this Court granted granted by order on February 8, 2018 February (further ordering that the trial court file its findings on or before March 20, 2018).

vii

ISSUES PRESENTED

Whether here Whether here is legally and factually insufficient insufficient evidence evidence to to support support the the court’s court's the introduction lack of finding that the introduction of EL EL Hollingsworth Hollingsworth to to Pro-Tech Pro-Tech constituted constituted disclosure of EJ Madison’s Madison's confidential information to Pro-Tech.

Whether there is legally and factually insufficient Whether insufficient evidence evidence to to support support the the court’s court's factual finding No. 6 that the “Project”

"Project" was the basis of the Agreement.

Whether there is legally and factually insufficient Whether insufficient evidence evidence to to support support the the court’s court's factual finding factual finding No.

No. 77 that the the language language of the the Agreement Agreement does not reflect reflect that that services not related to the conversion process constituted trade secrets.

Whether here Whether here is legally and factually insufficient insufficient evidence evidence to to support support the the court’s court's factual finding factual finding No. that there No. 8 that there was was no noadditional additional consideration consideration provided provided by Plaintiff to Defendant Plaintiff Defendant that that would would make make non-"Project"

non-“Project” services services covered covered by by the Agreement.

Whether there is legally and factually insufficient Whether insufficient evidence evidence to to support support the the court’s court's the services factual finding No. 9 that the services provided provided by by Defendant Defendant E.L.

E.L. Hollingsworth Hollingsworth industry, e.g., oil are those known in the industry, oil changes, changes, windshield windshield wiper replacements, replacements, and do not constitute trade secrets nor confidential information as intended by the Agreement.

Whether there is legally and factually insufficient Whether insufficient evidence evidence to to support support the the court’s court's factual finding No. 10 that Plaintiff did not provide Defendant with a written copy of its customer list and EL Hollingsworth is not a customer of Plaintiff.

Whether there is legally and factually insufficient Whether insufficient evidence evidence to to support support the the court’s court's factual finding No. 11 that Plaintiff is not entitled to any of the profits generated by non-“Project” services Defendant provided to E.L. Hollingsworth.

Defendant for non-"Project"

Whether there is legally and factually insufficient Whether insufficient evidence evidence to to support support the the court’s court's finding no. 12 that Plaintiff did not incur attorney’s attorney's fees.

Whether there is legally and factually insufficient Whether insufficient evidence evidence to to support support the the court’s court's lack of finding No. 12 that Plaintiff alleged its entitlement entitlement to to attorney’s attorney's fees, and the parties agreed that attorney’s attorney's fees would be proven in a separate hearing.

viii

Whether the Whether the court court erred erred as as aa matter matter of of law law in its conclusion conclusion of of law law no. that no. 1 that Defendant did not breach the Non-Disclosure Non Circumvention Agreement.

Whether the Whether the court court erred erredas as aa matter matter of of law law in in failing failing toto find, find, or or in lack of in its lack finding, that Defendant’s finding, profits, benefits and proceeds of Defendant's failure to turn over the profits, commercial relationship its commercial relationship with Hollingsworth does with EL Hollingsworth does not constitute constitute breach of fiduciary duty.

Whether the court erred as a matter of law in its conclusion of law no. 2 that there Non-Disclosure Non Circumvention Agreement reflecting an is no language in the Non-Disclosure intent that services not related to nor arising from the conversion process constitute trade secrets or confidential financial and business information.

Whether the Whether the court court erred erred as as a matter matter of law in its conclusion conclusion of law no. 3 that the terms of the terms the Non-Disclosure Non-Disclosure Non Non Circumvention Circumvention Agreement Agreement did not prohibit did not prohibit Defendant from Defendant from entering entering into a business business relationship relationship with E.L.

E.L. Hollingsworth Hollingsworth to provide mechanical services unrelated to the conversion process.

Whether the Whether the court court erred erred as as aa matter matter of of law law in its conclusion conclusion ofof law law no. that no. 4 that Defendant did Defendant not utilize did not utilize Plaintiffs'

Plaintiffs’ trade trade secrets secrets or or confidential confidential financial financial and and business information business informationinin entering entering into into aa business business relationship relationship with with E.L.

E.L.

Hollingsworth to provide mechanical services.

Whether the Whether the court court erred erred as as aa matter matter of of law law in its conclusion conclusion ofof law law no. that no. 5 that Plaintiff’s claim Plaintiff's claim for for breach breach of contract fails for lack of consideration.

Whether the Whether the court court erred erred as as a matter matter of law in its conclusion conclusion of law no. 6 that the alleged trade secret information was readily ascertainable by proper means, such as availability in trade journals, reference books, or published materials.

Whether the Whether the court court erred erred as as a matter matter of law in its conclusion conclusion of law no. 7 that the alleged proprietary information was not substantially secret.

Whether the Whether the court court erred erred as as aa matter matter of of law law in its conclusion conclusion of of law law no. that no. 8 that Plaintiff is not entitled to any damages, actual or punitive.

Whether the Whether the court court erred erred as as aa matter matter of of law law in its conclusion conclusion of of law law no. that no. 9 that Pursuant to §38.001 et seq., Tex. Civ. Prac. & Rem. Code, Plaintiff is not entitled to attorney’s attorney's fees.

ix

STATEMENT OF FACTS

Madison, LLC ("EJ EJ Madison, (“EJ Madison")

Madison”) is a trucking trucking company company formed in 2008.

2008.

Shortly thereafter, (RR III, 57). Shortly thereafter, itit began began doing doing business business with with Pro-Tech Diesel, Inc.

(“Pro-Tech”) to perform ("Pro-Tech") perform maintenance maintenancework workon onEJ EJMadison’s Madison's two two trucks.

trucks. (RR III,

57-58, 117). 57-58, Pro-Tech had 117). Pro-Tech had one one 11 to to22employees employees including including owner owner Richie Richie Rivera Rivera

(“Rivera”). (RR ("Rivera"). (RR III, III, 57-58;

57-58; 117, 117, 142).

142). The Thetwo twocompanies companies continued continued to do to do

business with, with, and and grow grow alongside, alongside,each eachother otherinto into2014.

2014. (RR (RR III, III, 57-58, 57-58, 117).

117). At

Madison had acquired that time, EJ Madison acquired forty-five forty-five (45) trucks trucks and some ninety (90)

trailers. (RR III, 58, (RR 58, 117-118).

117-118). EJ EJMadison Madison was wasone oneofofPro-Tech'

Pro-Tech’ss largest largest

customers. (RR customers. (RR III, 118).

In late 2012, early 2013, EJ Madison began to explore the use of duel fuels

(diesel and (diesel and natural natural gas)

gas) on save fuel on its trucks to save fuel costs costs and and because because natural natural gas

burns cleaner. (RR III, 58-59).

cleaner. (RR

EJ Madison's Madison’s manager, manager, John John Warren Warren ("Warren")

(“Warren”) approached approached Rivera about

working together together on on “dual "dual fuel fuel conversion.”

conversion." (RR III, 59). The The two two companies companies had

good business a good business relationship.

relationship. Nevertheless, Nevertheless, Warren Warren requested requested that Rivera Rivera enter enter

non-disclosure non-circumvent into a non-disclosure non-circumventagreement agreementon onbehalf behalfof ofPro-Tech.

Pro-Tech. (RR III,

59-60). EJ 59-60). EJMadison Madison and and Pro-Tech Pro-Tech entered entered into into the the Agreement Agreement on on February February 25,

(RRIV, 2013. (RR IV,Plt.'

Plt.’s Ex. 1)

s Ex. 1) (RR (RR III, III, 67)

67) ("Non-Disclosure (“Non-Disclosure and Non-Circumvention

Agreement”) (the “Agreement”). Agreement") "Agreement").

2

Warren had used and entered into similar agreements in business for many

years. (RR years. (RR III, III, 61-62).

61-62). This Thistype typeofofagreement agreement was was important important for for EJ EJ Madison Madison in

because Warren this instance because Warren wanted wanted to ensure he protected protected the development development of

any intellectual property and, further, to protect the introduction by EJ Madison to

Pro-Tech of EJ Madison's Madison’s valuable valuable business business relationships relationships which it had developed developed

considerable expense. at considerable (RR III, 62). Additionally, expense. (RR Additionally, Pro-Tech Pro-Tech stood stood to benefit not

performing installation only from performing installation of the technology technology specifically specifically but through through the

introduction to other companies, introduction companies, including including trucking trucking companies, companies, with whom Pro-

Tech might Tech might do business, generally.

do business, (RR III, generally. (RR III, 62-63).

62-63). Finally, Finally, Rivera Rivera also also

participated as as aa partner.

partner. (RR III, 63).

The Agreement provides in pertinent part:

Pro Tech Pro Tech and and EJM EJM have have entered entered into into discussions discussions with with each each other in other in connection connection with with prospective prospective business business arrangements arrangements and/or and/or opportunities involving involving the the following following commercial commercial project:

project: conversion trucks, including of trucks, including without without limitation, limitation, trucks trucks owned owned by EJM/its EJM/its related companies, from diesel powered operation to dual CNG/Diesel powered operation (the “Project”).

"Project").

Plt.’ss Ex. 1)

(RR IV, Plt.' 1) (Recitals (Recitals 91 ¶ 1);

1); (RR (RR III, III, 65-66). Ultimately, however, 65-66). Ultimately, however, EJ

Madison ruled-out Compressed Natural Gas (“CNG”)

("CNG") in favor of Liquified Natural

Gas ("LNG"). Gas (“LNG”). Warren Warren explained explained that such a change change is typical typical in the the course course of

development of aa project.

project. (RR III, 66-67).

After entering After entering into into the the Agreement Agreement with with Pro-Tech, Pro-Tech, EJ EJ Madison Madison began began

cultivating relationships with with other other companies.

companies. (RR III, 67).

3

significant time and expense In particular, EJ Madison spent significant expense developing developing a

relationship with relationship Hollingsworth and with EL Hollingsworth and Company Company ("EL (“EL Hollingsworth"), Hollingsworth”), a

“substantial transportation company" "substantial company” with several hundred trucks nationwide (RR

III, 67; III, 67; 69-70, 69-70, 139). Onororabout 139). On aboutAugust August 24, 24, 2013, 2013, EJ EJ Madison Madison and and EL EL

Hollingsworth entered Hollingsworth entered into into aa "Confidentiality “Confidentiality and and Non-Disclosure Non-Disclosure Agreement"

Agreement”

(“ELH Agreement"). ("ELH Agreement”). (RR IV, Plt.'

Plt.’ss Ex.

Ex. 2). ELHollinsworth 2). EL Hollinsworth was was interested interested in

converting trucks converting trucks in in its fleet to duel duel fuel fuel and and purchasing purchasing conversion conversion kits from EJ

Madison as its customer. (RR III, 65, 68). ItIt was was only only after after entering entering into the ELH

Agreement that EJ Madison Agreement Madison introduced introduced Pro-Tech to EL EL Hollingsworth.

Hollingsworth. (RR III,

67). Later, Later,EL ELHollingsworth Hollingsworth became became interested interested in being a financial financial partner. (RR

Warrenwould III, 68). Warren wouldnot nothave haveintroduced introduced Pro-Tech Pro-Tech to to EL EL Hollingsworth Hollingsworth had

Pro-Tech not entered into the Agreement. (RR III, 69).

Warren explained Warren explained that business when that in business when aa company company spends spends considerable considerable

time and money developing relationships and customers, it must ensure it protects

its investment from being circumvented because the right introduction “quite "quite often

launches that launches that business business and and makes makes that that business business into into the the success success that that itit is."

is.” Id.

Therefore, it is imperative Therefore, imperative to protect protect customer customer and and contractual contractual relationships.

relationships. Id.

Additionally, the expense of development of business Additionally, business and and customer customer relationships relationships

often results often results in in the thefurther furtherintroduction introduction and anddevelopment development of ofcontractual contractual

relationships which are lucrative in and of themselves. Id.

4

Here, EJ Madison, including Warren himself, developed a unique a system,

called a conversion conversion kit, kit, which which displaced displaceddiesel dieselfuel fuelfor fornatural naturalgas.

gas. Natural gas is

expensive and less expensive and burns bums cleaner cleaner all all without without sacrificing sacrificing performance.

performance. It did so by

coalescing electronic coalescing electronic control control module, module, fuel fuel injection injection and tank technologies and tank technologies to

become the only high-displacement system (over 50%) to obtain EPA certification.

(RR III, 70-72).

Beginning in Beginning EL Hollingsworth in July 2014, EL Hollingsworth began began operating operating EJ Madison's Madison’s

fleet of trucks fleet trucks out out of of Anthony, Anthony, Texas, Texas, 35 of of which which were were equipped equipped with with the the

conversion kits. conversion (RR III, kits. (RR III, 72-73).

72-73). EL ELHollingsworth Hollingsworth operated operated the the trucks trucks on duel duel

pursuant to contracts fuel pursuant contracts EJ Madison Madison had had developed developed with with natural natural gas gas provider provider

Clean Energy. Clean (RR III, Energy. (RR III, 73).

73). Additionally, Additionally,EL ELHollingsworth Hollingsworth entered entered into into a

business relationship with Clean Fuel Technologies, LLC (“CFT”)

("CFT") and Clean Fuel

Technologies, II, Technologies, II, LLC LLC (“CFT II”), successor ("CFT II"), successor companies to EJ Madison, Madison, whereby whereby

EL Hollingsworth Hollingsworth (and/or (and/orits its principals)

principals)became:

became: (1) aa buyer buyer of/customer of/customer for

conversion kits; (2)

(2) aa financial financial contributor;

contributor;and and(3)

(3)including includingasasaapartner.

partner. (RR III,

74-75). Rivera 74-75). Riveratoo toobecame becameaapartner partner in inCFT CFT which which owned owned aa portion portion of CFT CFT II.

(RR III, 76, 95).

CFT II incurred CFT incurred significant significant expenses expenses for improvements to for improvements to a property property in

Anthony, Texas (the "property")

“property”) from which Pro-Tech benefited because it began

5

conducting business conducting businessfrom fromthat thatlocation locationand andcontinues continuestotododoso.

so. (RR III, 72, 73,

75-78).

Beginning on or about August 1, 2014, 2014, Pro-Tech Pro-Tech began began performing performing general

maintenance work maintenance work for Hollingsworth including for EL Hollingsworth including on on the former former EJ EJ Madison Madison

trucks and trucks those equipped and those equipped with with the the conversion conversionkits. Rivera never kits. Rivera never sought sought EJ EJ

Madison’s authority, Madison's authority, written or otherwise, otherwise, to do do business business with with EL EL Hollingsworth Hollingsworth

unrelated to unrelated to the the project. (RR III, project. (RR III, 78).

78).Warren Warrenneither neithermade maderepresentations representations

beyond the terms of the Agreement prior to it being executed nor did he verbally verbally

authorize Pro-Tech authorize Pro-Tech to do business with EL EL Hollingsworth Hollingsworth by performing performing general general

(RR III, maintenance. (RR III, 158-160)

On May 11, 2015, EJ Madison Madison made written demand on Pro-Tech Pro-Tech pursuant

the terms to the terms of of the the Agreement Agreement and and the the provisions provisions of of the the Texas Texas Uniform Uniform Trade Trade

Secrets Act Secrets Act (“TUTSA”).

("TUTSA"). (RR (RR III, III, 80-81);

80-81);(RR (RRIV, IV,Plt.’s Plt.'s Ex.

Ex. 3). Rivera 3). Rivera

acknowledged receiving the demand letter (RR III, 140).

EJ Madison Madison maintenance maintenance records records reflect reflect that that Pro-Tech Pro-Tech ceased ceased providing providing

maintenance for maintenance for EJ Madison Madison in mid July 2014, 2014, the the same same time time EL EL Hollingsworth Hollingsworth

assumed operations assumed operationsof ofthe theEJ EJ Madison Madisonfleet.

fleet. (RR (RR III, III, 82);

82); (RR (RR IV, IV, Plt.’s Plt.'s Ex. 4).

Madison maintenance The EJ Madison maintenance records records for fleet (of for the fleet (of approximately approximately 45 trucks)

trucks)

beginning January beginning January 1, 1, 2013 through December 2013 through December 2014 2014 (ending (ending on on July 2014)

July 19, 2014)

totaled $312,166.04 $312,166.04 for for an an average average of of$16,429.79 $16,429.79per permonth. (RR III, 81-82); (RR month. (RR

6

Plt.’s Ex.

IV, Plt.'s Ex. 4).

4). Additionally, Additionally,Pro-Tech'

Pro-Tech’s own invoicing s own invoicing records records for for maintenance maintenance

provided to EL Hollingsworth, provided Hollingsworth, beginning beginning July 2014 and July 21, 2014 and extending extending through through

May 22, 2015, reflect a total of $212,290.09, for an average monthly revenue paid

by EL Hollingsworth Hollingsworth of of $21,229.09. (RR III, $21,229.09. (RR III, 83, 83, 140-141);

140-141); (RR IV, Plt.’s Plt.'s Ex. 5).

This number This number is consistent consistent with with the amount incurred the amount incurred by by EJ Madison Madison prior prior to EL

Hollingsworth assuming Hollingsworth assumingoperations.

operations.(RR (RRIII, III,82-83, 82-83,141). Madison, at its 141). EJ Madison,

highest point, highest compromised 10 point, compromised 10 to 15 percent to 15 percent of of Pro-Tech'

Pro-Tech’ss business business or or

approximately 2.5 million million dollars dollars in in annual annual sales.

sales. (RR III, 141-143).

If Pro-Tech If Pro-Tech had had approached approached Warren Warren about about doing doing business business with with EL EL

Hollingsworth, Warren Hollingsworth, Warren would would have have negotiated negotiated aa "win/win"

“win/win” agreement agreement to allow allow

Pro-Tech to Pro-Tech to profitably profitably do do business. (RR III, 87, business. (RR 87, 165-166).

165-166). Non-disclosure Non-disclosure nonnon -

circumvention agreements circumvention agreementsdo donot not “spell "spell out”

out" the terms in advance the terms advance because because the

parties need to be free to fully explore explore any any future future opportunities opportunitiesas as they theyoccur.

occur. (RR

III, 167).

Stuart Mitchell ("Mitchell"), (“Mitchell”), an attorney who primarily consults with young

developing businesses, businesses, testified testified as an expert concerning covenants not to compete

and confidentiality and non-circumvention non-circumvention agreements.

agreements. (RR III, 15-16, 17).

While covenants While covenants not compete are not to compete are narrowly narrowly construed construed because because they they

constrain productive constrain productive activity, non-circumvention non-circumvention agreements agreements and confidentiality confidentiality

agreements are agreements broadly construed, are broadly construed, but narrowly drawn, but narrowly drawn, to to protect protect intellectual intellectual

7

property and business practices of the protected party against abuse and unethical unethical

behavior by by the the party party one oneisisdoing doingbusiness businesswith.

with. (RR III, 16-17). Non-disclosure 16-17). Non-disclosure

non-circumvention agreements and non-circumvention agreements are are broadly construed because broadly construed because they protect protect

things known things known to parties —

to the parties — the the protected protected party's party’s interest interest in in his his contractual contractual

agreements, his agreements, customers, his financing his customers, financing sources sources — things considered secret and

(RR III, proprietary. (RR III, 17, 168-170).

confidentiality provisions The confidentiality provisions of these agreements agreements are necessary to protect

against the dissemination against dissemination of protected protected information, information, and and the thenon-circumvention non-circumvention

provisions “establish provisions "establishaa bond bond of loyalty between of loyalty between two parties who two parties who are are doing doing

business”—for example, to prevent one party from business"—for from doing doing business business with with the the other’s other's

customer (RR customer 18-19). Customers (RR III, 18-19). Customersare areuniversally universallyconsidered considered confidential confidential

information. (RR information. (RR III, 19).

Mitchell reviewed Mitchell reviewed the Agreement, Agreement, the ELH Agreement, Agreement, the depositions depositions of

Warren and Warren and Rivera Rivera and and the plaintiff’s exhibits.

the plaintiff's In Mitchell's exhibits. In Mitchell’s opinion, opinion, the the

Agreement in the first instance protected EJ Madison against Pro-Tech developing

business with EJ Madison's Madison’s contacts contacts and and customers customers without without first negotiating negotiating with

EJ Madison EJ Madison as as to to how how that that should shouldbe bedone. (RR III, done. (RR III, 19-20).

19-20). He He found found the the

Agreement to be “a "a very standard confidentiality, confidentiality, non-disclosure non-disclosureagreement.”

agreement." (RR

III, 20-21).

8

Additionally, while Additionally, the Agreement while the Agreement described described confidential confidential information information

broadly, the categories of confidential broadly, confidential information information of particular particular relevance relevance to this

transaction were transaction financing sources, were financing sources, contractual contractual relationships relationships and customers of and customers

which EL Hollingsworth Hollingsworth was was one.

one. (RR (RR III, III, 22-24). Madison’s relationship with 22-24). EJ Madison's

EL Hollingsworth, and the subject of the ELH Agreement, represented a protected

“contractual relationship” "contractual relationship"asasdefined definedininthe theAgreement.

Agreement. (RR (RR III, III, 24). In fact, 24). In fact, the

mere disclosure mere disclosure of the identity of the identity ofofEL ELHollingworth Hollingworthconstituted constituted protected protected

customer/client information customer/client information consistent consistent with with definitions definitions and protection under and protection under the

(RR III, 24-25).

TUTSA. (RR

maintaining the In addition to maintaining the confidentiality confidentiality of protected protected information, information, the

Agreement restricted Agreement restricteduse use of of the information by the information receiving party by the receiving party except except as

permitted in permitted in the Agreement. (RRIII, Agreement. (RR III,25-26);

25-26);(RR (RRIV, IV,Plt.'s Plt.’sEx.

Ex.1)1)(Recitals (Recitals91¶ 3,

Agreement ¶911).

1). The The Agreement Agreement restricted restricted use use of the confidential information to

“project-related business,” "project-related business,"i.e., i.e.,Pro-Tech Pro-Tech“was "wasnot notpermitted permittedtoto use use the EL the EL

Hollingsworth contact Hollingsworth contactfor foranything anythingoutside outsidethe theproject.”

project." (RR (RR III, III, 26); (RR IV,

Plt.’s Ex. Plt.'s Ex. 1)

1) (Agreement (Agreement 91 ¶ 1(d)).

1(d)). Furthermore, the Agreement provided that Pro-

Tech could Tech could not not independently independently develop develop business business with Hollingsworth as with EL Hollingsworth as its

identity is identity is itself itself confidential confidentialinformation.

information.(RR (RR III, III, 26);

26); (RR (RR IV, IV, Plt.’s Ex. 1)

Plt.'s Ex.

(Agreement ¶911(e)). (Agreement 1(e)). A A non-circumvention non-circumvention provision provision isis usual usual and and customary customary in a

non-disclosure non-circumvention non-circumvention agreement.

agreement. (RR III, 26-27).

9

Here, Pro-Tech initially did EJ Madison-related business with Hollingsworth

but later went well beyond project-related business without obtaining authorization

from EJ Madison. (RR III, Madison. (RR III, 31-32).

31-32). In Indoing doingso, so,Pro-Tech Pro-Tech wrongfully wrongfully obtained the

profits from doing business with EL Hollingsworth while denying EJ Madison any

benefit for benefit for having having made madethe theintroduction.

introduction.(RR (RRIII, III,32). Mitchell testified 32). Mitchell testified that that

introductions often introductions oftenproduce produce“found "foundmoney”

money"for forthe thereceiving receivingparty: “When I party: "When

introduce you introduce you to somebody somebody I’m doing business I'm doing business with, with, now now you you have have completely completely

found money money ifif you you are are doing doing business businesswith withthem.

them. And it’s only fair that I would it's only would

be compensated for having having brought brought that that new new business business to to you.”

you." (RR III, 170).

the event In the event of ofunauthorized unauthorized use use and and circumvention circumvention by by Pro-Tech, Pro-Tech, the the

Agreement provides Agreement provides an an assignment assignment to to EJ Madison of "the “the profits, profits, benefits and/or

proceeds obtained proceeds obtainedby byPro Pro Tech Tech as as aa result result of of any any use use ofofthe theConfidential Confidential

information that information that is not authorized by EJM".

EJM”. (RR (RRIV, IV,Plt.'

Plt.’s Ex.1)1)(Agreement s Ex. (Agreement91 ¶

1(e)). Such Suchaa"damages"

“damages”provision provisionisisusual usualand andcustomary, customary, and and reasonable, reasonable, in this

type of agreement agreement and is akin akin to to the the availability availability of of punitive punitive damages damages under the

TUTSA upon a showing of malice because a disclosing party can suffer extensive

damages which which are not easily calculated.

calculated. (RR (RR III, III, 33-34). Proceeds is 33-34). Proceeds is appropriate appropriate

because it prevents the receiving party from using the the confidential confidential information to

make lots of money, then hiding what he’s done, later he's done, later claiming claiming there is no money

10

damages. And, to pay damages. And, in inthis thiscase, case,Pro-Tech'

Pro-Tech’ss claim of losses belies belies that it has

remained in business for for ten ten years.

years. (RR III, 170-172, 173).

The Agreement further further provides provides “that "that all rights hereunder shall inure to the

successor in interest,"

benefit of any successor interest,” thereby thereby protecting protecting the original original developer as

well as other well other entities entities who, who, as as business business is is developed, developed, receive receive an interest interest in in

intellectual property intellectual propertyand and the the benefits benefitsflowing flowingfrom fromit.it. (RR III, 34-35);

34-35); (RR IV,

Plt.’s Ex. Plt.'s Ex. 1)

1)(Agreement (Agreement917).

¶ 7).

“The project in the Agreement "The Agreement defines the reason why the parties began to

do business in a confidential confidential and protected protected way, way, but but itit doesn’t doesn't define the scope of

all the all the information information that’s protected . .. . .[t]he that's protected [t]heconfidential confidential information information that that is

protected is protected is listed listed there there in the the first first part part of of the theagreement agreement as as financing financing sources, sources,

customers et customers et cetera.” These agreements cetera." These agreements are drawn drawn this this way for the the reason reason the the

parties simply parties simply do know the opportunities opportunities that may arise or the the introductions introductions that

may eventually eventually be be made. (RR III, made. (RR III, 36).

36). Confidential Confidentialinformation information includes includes "new “new

product” development. (RR product" (RRIII, III,37)

37)(RR (RR IV, IV, Plt.'s Plt.’sEx.

Ex.1)

1)(Recitals (Recitals911).

¶ 1).

Agreement were narrowly The restraints provided in the Agreement narrowly drawn, drawn, reasonable reasonable

and consistent with public public policy.

policy. (RR III, 38-39).

Rivera Rivera had had an opportunity opportunity to to read read the the Agreement Agreementbefore beforehe hesigned signedit.

it. (RR

117-118). He III, 117-118). He felt felt the theopportunity opportunity for for Pro-Tech Pro-Tech to become become an installer installer of the

conversion kits conversion kitstoto be be aa good good one. (RR III, one. (RR III, 118).

118). Rivera Rivera and and Pro-Tech Pro-Tech had had not not

11

performed installations performed installations of of this this type prior to entering entering into the the agreement, agreement, obtained obtained

perform the installation the benefit of how to perform installation as the result of the the Agreement, Agreement, and

were paid to do installations installations on on EJ EJ Madison Madison trucks.

trucks. (RR III, 119).

Rivera acknowledged acknowledged that Pro-Tech Pro-Tech began began doing maintenance maintenance work work for EL

Hollingsworth on Hollingsworth on or or about about August August 1, 1, 2014 2014 and and continued continued to to do do so so at the time of

trial. Id. Rivera made the decision in December 2014/January 2015 that Pro-Tech

would no longer perform work on the would the conversion conversion kits on on the the EL EL Hollingsworth-

Hollingsworth-

operated trucks operated trucks not because the conversion conversion kits were not operational operational but, rather, rather,

because he felt like this work because work was was restricted restricted by by the the terms terms of of the the Agreement.

Agreement. (RR

119-121). Nevertheless, III, 119-121). Nevertheless, he did did not not approach approach Warren Warren about about whether whether it was was

appropriate under appropriate under the the terms terms of Agreement, and of the Agreement, required EJ Madison's and that required Madison’s

written authorization, authorization, to to do do general general maintenance maintenance work work for for EL EL Hollingsworth.

Hollingsworth. (RR

III, 121-122).

Rivera Rivera understood understood that that any any modification modification to to the the Agreement Agreement needed needed to to be in

writing and, further, that any use of the confidential confidential information beyond the scope

of the of the project project required required the the parties'

parties’ signatures signatures and and EJ EJ Madison's Madison’s written written

authorization. (RR authorization. (RR III, III, 122-123, 122-123, 132-133).

132-133). And, And, Pro-Tech Pro-Tech neither neither knew knew the the

identify of nor had done any work for EL EL Hollingsworth Hollingsworth prior to entering into the

Agreement and being introduced introduced to to them them by by Warren.

Warren. (RR III, 124).

12

Furthermore, Rivera Furthermore, Rivera agreed agreed that signed the that when he signed the Agreement, Agreement, Pro-Tech Pro-Tech

was agreeing to keep certain of EJ Madison's Madison’s information information confidential confidential and, more

importantly, that importantly, that EJ Madison Madison was providing providing the information information only because because Pro-

Pro-

Tech had entered entered into into the the Agreement. Rivera understood Agreement. (RR III, 128). Rivera understood Pro-Tech Pro-Tech

would be provided opportunities that otherwise it would not have had it not entered

into the Agreement. into Agreement. (RR (RR III, III, 128-129).

128-129). Rivera Riveraunderstood understood that that Pro-Tech Pro-Tech was was

prohibited from circumventing prohibited circumventing EJ EJ Madison Madison as to its its confidential confidential information information and

the opportunities. (RR III, 128-131).

opportunities. (RR

Rivera acknowledged acknowledged signing signing the Agreement Agreement and that it contained a merger

clause, i.e., clause, he signed i.e., that he signed itit without without relying relying on on any any prior priorororcontemporaneous contemporaneous

representations outside the terms terms of of the the Agreement.

Agreement. (RR III, 132-135).

On June 20, On June 20, 2017, 2017, the parties tried the parties tried the the case case nonjury. In the nonjury. In the process process of

rendering judgment and announcing her decision, Judge Guadalupe Rivera agreed

that EJ that EJ Madison's Madison’s introduction introduction of of EL ELHollingsworth Hollingsworth to to Pro-Tech Pro-Tech constituted constituted

confidential information. confidential information. (RR III, 192).

(RR III, 192). Nevertheless, Nevertheless, she she determined determined that that

introduction did not relate to the Project, introduction Project, i.e., the conversion conversion process and, further,

Agreement did not that the Agreement not prevent prevent Pro-Tech Pro-Tech from from "conducting “conducting its business business as

usual.” (RR usual." (RR III, III, 193).

13

SUMMARY OF THE ARGUMENT

Madison, LLC and Pro-Tech, EJ Madison, Pro-Tech, Inc. entered entered into into an an unambiguous unambiguous Non-

Non-

Disclosure and Non-Circumvention Agreement (the “Agreement”)

"Agreement") which protected

the disclosure, the disclosure, and limited the and limited the use use of, of, trade trade secret secret information information EJ EJ Madison Madison

furnished to furnished to Pro-Tech Pro-Tech to to only only that that which which was was project-related.

project-related. In reliance on the

Agreement, EJ Agreement, Madison disclosed EJ Madison disclosed the identity of the identity of its itscustomer/contact customer/contact EL EL

Hollingsworth to Hollingsworth Pro-Tech, and thereafter to Pro-Tech, thereafter Pro-Tech Pro-Tech began began doing doing non-project non-project

related business with EL Hollingsworth.

The trial court rendered judgment against EJ Madison finding the disclosure

its relationship of its relationship with EL Hollingsworth Hollingsworth was was not protected because not protected because itit did not

relate to the Project, i.e., conversion of diesel-powered vehicles to duel fuel.

The Agreement The Agreement can can only only reasonably reasonablybe be read read such such that protects EJ that it protects EJ

Madison’s disclosure Madison's disclosure of its trade secret information pursuant pursuant to to the the Agreement.

Agreement. To

interpret it only to protect information interpret information used used to evaluate evaluate the the project project or that can be

said to be related to the conversion conversion process results in provisions of the Agreement

being rendered meaningless and the Agreement itself rendered worthless.

The trial court’s findings of court's findings of fact fact and and conclusions of law in this regard should

be disregarded, and the case reversed and remanded.

14

ARGUMENT AND AUTHORITIES

I. Standard Standard of of review.

review.

A. Nonjury Trial

Findings of fact may be requested in “any "any case tried in the district or county

court without court without aa jury.” Tex. R. Civ. Proc.

jury." Tex. Proc. 296. A case 296. A case is is "tried"

“tried” when when there is a

hearing before the court on conflicting evidence. Besing v. Moffit, 882 S.W.2d 79,

App.—Amarillo 1994, no writ). Timmons 81-82 (Tex. App.—Amarillo Timmons v. Luce, 840 S.W.2d 582,

586 (Tex. App.—Tyler 1992, no writ).

Findings of Fact

A trial A trial court's court's findings findings of fact fact are are reviewable reviewable for for legal legal and and factual factual

sufficiency of sufficiency of the evidence evidence by the same same standards standards that are are applied applied in in reviewing reviewing

evidence supporting evidence supporting a jury's answer.

answer. Catalina Catalina v. Blasdel, S.W.2d 295, 297 Blasdel, 881 S.W.2d

(Tex. 1994); Anderson v. City of Seven Points, 806 S.W.2d 791, 794 (Tex. 1991);

see also MBM Fin. Corp. v. Woodlands Operating Co., 292 S.W.3d 660, 663 n.3 v. Woodlands

(Tex. 2009). In In aafactual factual sufficiency sufficiency review, review, the the court court reviews reviews all the evidence and

may reverse the decision decision of the trial court only if its ruling is so against the great

weight and preponderance of the evidence as to be manifestly erroneous or unjust.

Estate of Judd, Estate S.W.3d 436 (Tex.

Judd, 8 S.W.3d (Tex. App.—El App.—El Paso Paso 1999, no pet.)

pet.) (citing (citing In re

King’s 662, 664-65, Estate, 150 Tex. 662, King's Estate, 664-65, 244 S.W.2d S.W.2d 660, 661 661 (1951);

(1951); Runnels Runnels v.

849 (Tex.

Firestone, 746 S.W.2d 845, 849 (Tex. App—Houston App—Houston [14th Dist.], writ denied, denied,

15

760 S.W.2d 760 S.W.2d 240 240 (Tex.

(Tex. 1988). When aa reporter's 1988). When reporter’s record record is is part part of of the the appellate appellate

record, findings record, findings of fact are not not conclusive conclusive on appeal, appeal, even even ifif unchallenged.

unchallenged. Zac

Smith Smith & Co. v. Otis Otis Elevator Elevator Co., S.W.2d 662, 666 (Tex.

Co., 734 S.W.2d (Tex. 1987);

1987); Estate of

Judd, 8 S.W.3d at 441.

In reviewing such a point, the court court considers considers and weighs all the the evidence, evidence,

both the evidence that tends to prove as well as the evidence that tends to disprove

existence. Id. (citing Ames its existence. Ames v. Ames, 158-159 (Tex. 1989), Ames, 776 S.W.2d 154, 158-159 1989),

denied, 494 cert. denied, 494 U.S.

U.S. 1080, 1080, 110 110 S.Ct.

S.Ct. 1809, 1809, 108 108 L. Ed. 2d 939 939 (1990);

(1990); Cain v.

Bain, 709 S.W.2d 175, 176 (Tex.

(Tex. 1986). So, considering 1986). So, considering the evidence, if a finding

so contrary is so contrary to the the great great weight weight and and preponderance preponderance of of the evidence as the evidence as to be

manifestly unjust, manifestly unjust, the the point should be sustained, point should sustained, regardless regardless of whether there of whether there is

some evidence to support it. Id. (citing Watson v. Prewitt, 159 Tex. 305, 305, 320

S.W.2d 815, 816 (1959); In re King's Estate, 244 S.W.2d at 661).

In a legal sufficiency or "no “no evidence"

evidence” review, the court may sustain a legal

sufficiency challenge sufficiency challenge only only when when (1)

(1) the record discloses discloses a complete complete absence absence of

evidence of a vital fact, (2) the court is barred by rules of law or of evidence from

giving weight giving weight to the only evidence evidence offered offered to prove a vital fact, (3) the the evidence evidence

offered to prove offered prove a vital fact is no no more more than than aa mere mere scintilla, scintilla, or (4)

(4) the the evidence evidence

establishes conclusively establishes conclusively the the opposite opposite of of a vital fact. Ford Motor Co. v. Castillo, Ford Motor Castillo,

S.W.3d 616, 620 (Tex. 2014) (op. on reh'g);

444 S.W.3d reh'g); Uniroyal Uniroyal Goodrich Goodrich Tire Tire Co.

Co. v.

16

Martinez, 977 S.W.2d 328, 334 (Tex. 1998), cert. denied, 526 U.S. 1040 (1999). In

determining whether determining whether there there is legally sufficient is legally sufficient evidence evidence to support the finding to support finding

under review, under review, the court must the court must consider consider evidence evidence favorable favorabletoto the the finding finding ifif a

reasonable factfinder could and disregard evidence contrary to the finding unless a

reasonable factfinder reasonable factfinder could could not. Cent. Ready Mix Cent. Ready Concrete Co.

Mix Concrete Islas, 228 Co. v. Islas,

S.W.3d 649, 651 (Tex. 2007); City of Keller v. Wilson, 168 S.W.3d 802, 807, 827

(Tex. 2005).

When the court sustains a legal sufficiency issue, it has a duty to render

judgment for the appellant because that is the judgment the trial court should have

rendered. Vista Chevrolet, Inc.

Vista Chevrolet, S.W.2d 176, 176 (Tex.

Lewis, 709 S.W.2d Inc. v. Lewis, (Tex. 1986);

1986); see

Tex. R. App. P. 43.3.

Conclusions of Law

The legal The legal conclusions conclusions of of the trial court the trial court are not not binding binding on on the the appellate appellate

court; appellate court; appellate courts courts are are free free to draw draw their their own own legal legal conclusions conclusions and and review review

those conclusions those conclusions de novo.

de novo. Hydrocarbon Hydrocarbon Management, Management,Inc.

Inc. v. Tracker v. Tracker

Exploration, Inc., 861 S.W.2d 427, 431 (Tex. App.—Amarillo 1993, no writ); see

also Austin Hardwoods, Inc. v. Vanden Berghe, 917 S.W.2d 320, 322 (Tex. App.—

El Paso 1995, writ denied).

17

Contract Law

When a contract is susceptible When susceptible to a legal legal meaning, meaning, the construction construction of the

written instrument instrument is one of law for the court. Id. When parties disagree over the

meaning of an unambiguous meaning unambiguous contract, contract, the the court court must must determine determine the the intent intent of the

parties. This parties. This determination determination must be based based on on the the objective objective intent of the the parties parties

expressed in expressed the agreement, in the agreement, and and not not their theirpresent presentinterpretation.

interpretation. Austin

Hardwoods, Inc., 917 S.W.2d at 323.

FINDINGS OF FACT

II. There is legally and factually insufficient evidence to support the court’s lack of finding that the introduction of EL Hollingsworth to Procourt 's Tech constituted disclosure of EJ Madison's Madison’s confidential information to Pro-Tech. [Amended finding No. 3]

III. There is legally and factually insufficient evidence to support the court’s factual court's factual finding finding No.

No. 66 that that the "Project"

“Project” was was the the basis basis of the Agreement.

IV. IV. There is legally and factually insufficient evidence to support the court’s factual court's factual finding finding No.

No. 7 that the the language language of the the Agreement Agreement does not reflect that services not related to the conversion process constituted trade secrets.

V. There is legally and factually insufficient evidence to support the court’s factual finding No. 8 that there court's there was was no no additional additional consideration consideration provided by provided Plaintiff to by Plaintiff to Defendant Defendant that that would would make make non-"Project"

non-“Project”

services covered by the Agreement.

VI. There is legally and factually insufficient evidence to support the court’s factual court's factual finding finding No. 9 that that the the services services provided provided by by Defendant Defendant Hollingsworth are E.L. Hollingsworth are those those known known in the industry, industry, e.g., oil changes, changes, windshield windshield wiper wiper replacements, replacements, and and do not constitute trade secrets nor confidential information as intended by the Agreement.

18

VII. There is legally and factually insufficient evidence to support the court’s factual finding court's finding No. 10 that that Plaintiff Plaintiff did not not provide provide Defendant Defendant with a written copy of its customer customer list and EL Hollingsworth Hollingsworth is is not a customer of Plaintiff.

VIII. There is legally and factually insufficient evidence to support the court’s factual finding court's finding No.

No. 11 that Plaintiff Plaintiff is not entitled entitled to any of the profits generated profits generated by Defendant Defendant for for non-"Project"

non-“Project” services services Defendant Defendant

2

provided to E.L. Hollingsworth. 2

A. The Agreement

The Agreement provides in pertinent part:

RECITALS:

trucking company EJM is a trucking company and Pro Tech is in the business of truck maintenance truck maintenance and repair, including, and repair, including, among among other other things, things, converting trucks from diesel powered operation to dual converting dual CNG/diesel CNG/diesel powered operation. powered Pro Tech operation. Pro Tech and and EJM EJM have have entered entered into into discussions discussions with each other in connection with prospective business arrangements and/or opportunities and/or opportunities involving involving the following following commercial commercial project:

project:

conversion of trucks, including conversion including without without limitation, limitation, trucks owned by trucks owned EJM/its related EJM/its related companies, companies, from from diesel powered operation diesel powered operation to dual to dual CNG/Diesel powered powered operation operation (the (the‘Project’).

'Project').

IV, Plt.'

(RR IV, Plt.’s Ex.1)

s Ex. 1)(Recitals (Recitals91 ¶ 1).

[I]n order to evaluate [I]n evaluate the feasibility feasibility of the Project, Project, EJM EJM will will provide to Pro provide Pro Tech Tech confidential confidential financial financial and and business business information information concerning EJM’s concerning business plans, EJM's business plans, financing financing sources, sources, sales, sales, margins, margins, profits, customers, profits, customers, marketing marketing programs programs and plans, new and plans, new product product developments, contractual developments, contractualrelationships relationshipsasas well well asas proprietary proprietary information concerning information concerning product technology, software, product technology, secrets, software, trade secrets, product development, product development, new new product product ideas ideas and new applications and new applications for

2 2 and factual The legal and factual sufficiency sufficiency of Findings of Fact Nos. 6-11 6-11 and and Amended Amended Finding of Fact No. 33 will will be be argued argued together together as as they they depend depend upon upon aa review review of of Agreement Agreement for their their resolution. Austin Hardwoods, Inc., 917 S.W.2d at 323.

19

existing products and technology, all of the foregoing being hereafter referred to as ‘Confidential 'Confidential Information.’

Information.'

Plt.’sEx.

(RR IV, Plt.'s Ex.1)1)(Recitals (Recitals91¶ 2).

EJM has agreed to furnish such Confidential Information to the Pro Tech to allow Pro Tech the opportunity to evaluate the feasibility the Project, of the Project, but but only only on on the the condition condition that that both both the the Confidential Confidential Information, and Information, and all documents derived all documents derived from containing the from or containing the Confidential Information be maintained confidential and used only as allowed under this Agreement.

(RR IV, Plt.'s Plt.’sEx.

Ex.1)

1)(Recitals (Recitals91 ¶ 3)

3) (emphasis (emphasis added).

AGREEMENT:

1. Non-Disclosure, Non-Use Non-Disclosure, Non-Use andand Non-Circumvention.

Non-Circumvention. Pro Tech shall: Tech shall: (a)

(a) keep keep EJM'

EJM’s Confidential Information s Confidential Information in strict in strict confidence; (b) confidence; (b) protect protect itit with with the the same same degree degree of of care care as the Pro own Confidential Tech treats its own Confidential Information;

Information; (c)(c) not without the prior written consent of EJM, disclose or permit it to be discloseddisclosed anyone other to anyone other than than Pro ProTech'

Tech’s directors, officers, s directors, officers, employees, employees, agents or agents consultants who or consultants who have have a legitimate legitimate need need to know the to know the Confidential Information Information for the Pro Tech to negotiate, participate in, or perform services with respect to the Projects; (d) will not use, and will not and not permit permit its its directors, directors, officers, officers, employees, employees, agents agents or consultants to consultants the Confidential to use, the Confidential Information Information for reason for any reason other than other than for for the the Project;

Project; andand (e)

(e) not not circumvent circumvent EJMEJM in in connection with the Confidential Information.

IV, Plt.'

(RR IV, Plt.’s Ex. 1)

s Ex. 1)(Agreement (Agreement91 ¶ 1).

Findings of Fact Nos. 3 and 6

In its Finding of Fact No. 3, the trial court found:

After entering into the Agreement, EJ Madison introduced Pro-

Tech to EL Hollingsworth, Hollingsworth, a Michigan Michigan company that operates diesel vehicles in Michigan, Michigan, with with subsequent subsequent operations operationsin in Texas.

Texas. Based on maintenance service on this introduction, Pro-Tech began providing maintenance

20

Hollingsworth trucks, EL Hollingsworth including oil changes, tire and windshield trucks, including windshield replacements.

(CR II, 5). InInresponse, (CR response,Appellant Appellant filed filed its its "Plaintiff's “Plaintiff’s Request Request for

Amended Findings Amended Findings of of Fact Fact and andConclusions ConclusionsofofLaw.

Law. (CR (CR II, II, 8). Appellant 8). Appellant

requested the following amended Finding of Fact No. 3.:

[Amended] 3. After [Amended] After entering entering into into the the Agreement, Agreement, EJEJ Madison Madison introduced Pro-Tech introduced Pro-Tech to EL Hollingsworth, a Michigan company that operates diesel operates vehicles in Michigan, diesel vehicles Michigan, with subsequent subsequent operations operations in Texas. The introduction The introduction of EL Hollingsworth of EL Hollingsworth to to Pro-Tech Pro-Tech constituted disclosure constituted disclosure of EJ Madison's Madison’s confidential confidential information information to Pro-Tech. Based this introduction, Based on this introduction, Pro-Tech Pro-Tech began began providing providing maintenance service maintenance service on EL Hollingsworth on EL Hollingsworth trucks, trucks, including including oil oil

3

changes, tire and windshield replacements.

replacements.'

(CR II, 8). Thus, Thus,Appellant Appellant can can challenge challenge lack of this finding. See e.g., Vickery v.

Commission for Lawyer Discipline, 5 S.W.3d 241, 254 (Tex.App.—Houston [14th

Dist.] 1999, pet. denied).

denied). Judge Judge Guadalupe Guadalupe specifically specifically found on the record that

the introduction the introduction of EL EL Hollingsworth Hollingsworth constituted constituted EJ EJ Madison's Madison’s confidential confidential

information. (CR information. (CR II, II, 192-193).

192-193). The Theabove aboveamended amended requested requested finding finding of fact fact

conforms the conforms the findings findingstoto the the trial trial court’s court's ruling ruling on on the record. Moreover, the record. Moreover, as

discussed below, discussed below, there there is is no question question but that that when when EJ EJ Madison Madison introduced introduced EL

Hollingsworth to Pro-Tech it disclosed confidential information that was protected

and limited in the manner it could be used by Pro-Tech.

In its Finding of Fact No. 6, the trial court found:

33 33 The language in bold is the proposed language amending the finding.

21

The "Project"

“Project” i.e., i.e., the the conversion conversion of of diesel diesel powered powered trucks to dual CNG/Diesel dual CNG/Diesel powered poweredvehicles vehicles waswasthethebasis basis of the of the Confidentiality and Non-disclosure agreement executed by the parties.

(CR II, 5).

A review of the language language of of the the Agreement Agreement as as set set forth forth above above reveals:

reveals: (1)

Madison and Pro-Tech EJ Madison Pro-Tech "entered “entered into into discussions discussions with each each other other concerning concerning

prospective business arrangements and/or opportunities prospective involving the [Project]"

opportunities involving [Project]”

Plt.’s Ex.

(RR IV, Plt.'s Ex. 1)

1) (Recitals (Recitals 91 ¶ 1)

1)(emphasis (emphasisadded);

added);(2) “[I]n order to evaluate (2) "[I]n

the feasibility of the Project, Project, EJM will will provide provide to to Pro Pro Tech Tech confidential confidential financial financial

and business and business information information concerning concerningEJM’s EJM's. . .. . financing sources.. .. . profits, financing sources

customers . . . plans, new product developments, contractual relationships as well customers

concerning .. .. . trade as proprietary information concerning secrets .. .. . all of the trade secrets the foregoing foregoing

being hereafter being hereafter referred referredtotoas as ‘Confidential 'ConfidentialInformation’”

Information' (RR (RR IV, IV, Plt.’s Plt.'s Ex. 1)

¶ 2)2)(emphasis (Recitals 91 (emphasisadded);

added);(3)

(3)“EJM "EJM has has agreed agreed to to furnish such Confidential

Information to Information to .. . . Pro Pro Tech Tech to to allow allow Pro Pro Tech Tech the the opportunity opportunity to to evaluate evaluate the

feasibility of feasibility of the Project, Project, but only only on on the the condition condition that that both both the the Confidential Confidential

Information .. . .. be Information be maintained maintained confidential confidential and used only as allowed allowed under this

Agreement” (RR Agreement" Plt.’s Ex.

(RR IV, Plt.'s Ex. 1)

1)(Recitals (Recitals91 ¶ 3)

3) (emphasis (emphasis added);

added); and and (4) "Pro “Pro

Tech shall: (a)

(a) keep keep EJM's EJM’sConfidential Confidential Information Information in in strict strict confidence . . . [and]

will not use . . . the Confidential Information for any reason other than the Project

22

[and] not circumvent EJM in connection . . . . [and] connection with the the Confidential Confidential Information."

Information.”

(RR IV, Plt.’s Ex. 1)

Plt.'s Ex. 1) (Agreement911)

(Agreement ¶ 1) (emphasis added).

In the instant case, there is no question but that the parties disagree as to the

meaning of meaning the Agreement of the Agreement and and the scope of the the scope the protection protection provided provided for EJ for EJ

Madison’s confidential Madison's confidential information vis-à-vis vis-à-vis the the Project. EJ Madison Project. EJ Madison asserted that

Agreement restricted the Agreement restricted use of of the the confidential confidential information information to to "project-related “project-related

business,” i.e., business," i.e., that Pro-Tech “was that Pro-Tech permitted to use "was not permitted use the the EL ELHollingsworth Hollingsworth

contact [or any other protected protected information]

information] for for anything anything outside outsidethe theproject.”

project." (RR

IV, Plt.'s III, 26) (RR IV, Plt.’s Ex.

Ex. 1)

1)(Agreement (Agreement 91 ¶ 1(d)). On the 1(d)). On the other other hand, hand, Pro-Tech Pro-Tech

purported to purported assert that the to assert the confidential confidential information information was was protected protected only only to to the

limited extent limited extent necessary necessary to evaluate the the Project, Project, (RR (RR III, 41-44), or III, 41-44), the or if the

confidential information confidential information specifically specifically related the subject related to the subject of of the the project—

project—

conversion of diesel diesel trucks trucks to to duel duel fuel.

fuel. (RR III, 191-193; see also R III, 9-12 (the

argument of defendant’s defendant's counsel).

When parties When parties disagree disagree over over the meaning meaning of an an unambiguous unambiguous contract, contract, the

court must determine determine the the intent intent of of the the parties. This determination parties. This determination must be based based

the objective on the objective intent intent of the the parties parties expressed expressed in the the agreement, agreement, and not their their

present interpretation. The construction interpretation. The construction of an an unambiguous unambiguous contract is a question question

of law for the court. To To determine determine the the objective objective intent intent of the parties, a court should

examine the examine the entire entire instrument instrumentin in an an effort effort to harmonize and to harmonize and give give effect effect to all

23

provisions of provisions the contract of the contract so that that none none will will be berendered rendered meaningless.

meaningless. Austin

Hardwoods, Inc., 917 S.W.2d at 323.

Pro-Tech’ss interpretation Here, Pro-Tech' interpretationand and the the trial trial court’s finding wholly court's finding wholly fails to

recognize, much recognize, much less less harmonize harmonize and and give give effect effect to, all provisions of the contract contract

such that multiple such multiple provisions provisions are are rendered rendered meaningless. First, by limiting meaningless. First, limiting the

Project renders the "non-use"

scope of protection to evaluation of the Project “non-use” and "non-

“non-

circumvention” provisions circumvention" provisionsineffective.

ineffective. Paragraph Paragraph33 of of the the Recitals Recitals in first in the first

instance provides that the confidential information is being furnished on condition

that itit "be that “bemaintained maintained confidential confidential and and used used only only as as allowed under this allowed under this

Agreement.” (RR Agreement." (RR IV, Plt.’s Ex.

IV, Plt.'s Ex. 1)

1)(Recitals (Recitals 91 ¶ 3)

3) (emphasis (emphasis added). Thereafter, added). Thereafter,

paragraph 1. "Non-Disclosure, paragraph “Non-Disclosure, Non-Use Non-Use and and Non-Circumvention"

Non-Circumvention” independently independently

provides that Pro-Tech provides Pro-Tech "keep “keep the the "Confidential “Confidential Information Information in strict strict confidence confidence

[and] (d) . . . not use . . . the Confidential Information for any reason other than the

Project.. .. . and Project and (e) not circumvent circumvent EJM EJM in connection connection with with the the Confidential Confidential

Information." (RR IV, Plt.'s Information.” Plt.’s Ex.

Ex. 1)

1)(Agreement (Agreement 91 ¶ 1(d)(e))

1(d)(e))(emphasis (emphasisadded).

added). To

Pro-Tech’ss interpretation not only renders the above provisions meaningless accept Pro-Tech'

but effectively renders renders the Agreement Agreement worthless worthless as Madison as it would provide EJ Madison

no protection whatsoever. Thus, whether whatsoever. Thus, whether Pro-Tech Pro-Tech "evaluates"

“evaluates” the Project in good

pursuant according faith or continues-on pursuant according to the original purpose of the disclosure disclosure

the protected of the protected information, information, according according to to Pro-Tech, Pro-Tech, itit is thereafter to use is free thereafter

24

whatever confidential/proprietary/trade whatever confidential/proprietary/trade secret secret information informationitit has has received received as long

evaluate the project or did not as same was not used to evaluate not specifically specifically pertain to the

subject of the Project—here related related to to conversion.

conversion. Thus, it matters not whether the

information is otherwise EJ Madison’s proprietary or trade secret information, i.e., Madison's proprietary

Confidential Information Confidential Informationasas provided provided in the Agreement.

in the Agreement. Obviously, Obviously, the

Agreement cannot Agreement cannot reasonably reasonably be interpreted to leave be interpreted leave otherwise otherwise protected protected

information unprotected information unprotectedsimply simplybecause becausethe the receiving receivingparty party describes describes itit as

unnecessary to unnecessary to evaluation evaluation of of the Project and/or the Project and/or as unrelated unrelated to what the the parties parties

originally described originally describedasasthe the Project.

Project. ItIt isisonly onlynecessary necessary that that the theconfidential confidential

information was information was disclosed disclosed pursuant pursuant to to the Agreement Agreement and be confidential and that it be confidential

information. IfIf so, information. so,the thereceiving receiving party party (Pro-Tech)

(Pro-Tech) can can neither neither use use nor nor circumvent circumvent

the confidential the disclosing party (EJ Madison) as to the confidential information and can only

use it for use for Project-related Project-related purposes. As Mitchell purposes. As Mitchell testified, “The project testified, "The project in the the

Agreement defines Agreement definesthe thereason reasonwhy whythe the parties partiesbegan begantoto do business in do business in a

confidential and confidential andprotected protectedway, way,but butitit doesn’t doesn't define definethe the scope scope of all the of all the

information that’s information that's protected . . .. [t]he [t]he confidential confidential information information that is protected is

listed there listed there in the first first part part of of the theagreement agreement as as financing financing sources, sources, customers customers et

cetera.” He cetera." Hefurther furtherexplained explained these these agreements agreements are drawn this way for the reason

know the the parties simply do know the opportunities opportunities that may arise or or the the introductions introductions

that may eventually be made. (RR III, 36)

25

Findings of Fact Nos. 7-11

In its Finding of Fact No. 7, the trial court further found:

It was was not not intended intended nor nor is there there any any language language in the the Non-

Non-

Disclosure Disclosure Non-Circumvention Non-Circumvention Agreement Agreementreflecting reflecting an an intent intent that services not services related nor not related nor arising arising from from the theconversion conversion process process constituted trade constituted secrets or trade secrets or confidential confidential financial financial and and business business information.

(CR II, 5-6).

In its Finding of Fact No. 8, the trial court further found:

There was no additional consideration provided provided by Plaintiff to Defendant Defendant that would make that would make non-Project non-Project services services covered covered by the by the Agreement.

(CR II, 6).

In its Finding of Fact No. 9, the trial court further found:

The services provided by Defendant to E.L. Hollingsworth Hollingsworth are those known those known in thethe industry, industry, e.g., e.g., oil oilchanges, changes, windshield windshield wiper wiper replacements, replacements, and and do constitute trade do not constitute trade secrets secrets nor nor confidential confidential information as intended by the Agreement.

(CR II, 6).

In its Finding of Fact No. 10, the trial court further found:

Plaintiff Plaintiff did did not provide Defendant not provide Defendant with with aa written written copy copy of its customer list, and EL Hollingsworth is not a customer of Plaintiff.

(CR II, 6).

In its Finding of Fact No. 11, the trial court further found:

26

Plaintiff Plaintiff isis not entitled to not entitled any of to any of the the profits profits generated generated by by Defendant Defendant for non-“Project” services for non-"Project" services Defendant Defendant provided provided to E.L.

E.L.

Hollingsworth.

(CR II, 6).

Again, to determine whether there is legally and factually sufficient evidence

supporting the supporting the above above findings, findings, it is necessary to review the entire entire Agreement, Agreement, to

harmonize and harmonize and give give effect effect to to all its provisions all its provisions so that that none none will will be be rendered rendered

meaningless. Austin Hardwoods, Inc., 917 S.W.2d at 323.

contractual language set forth above quite simply does not A review of the contractual

even refer even refer to or or purport purport to to address, address, much much less less define, define, Pro-Tech’s Pro-Tech's services “not services "not

related nor arising from the conversion related conversion process"

process” or that that same same "constituted “constituted trade trade

secrets” or other protected secrets" protected information information of of EJ EJ Madison.

Madison. (CR II, 5-6) (FOF No. 7).

Further, it appears the trial court conflated the Agreement’s Agreement's restrictions in the non-

non-circumvention provisions use and non-circumvention provisions with traditionally considered nonwith what is traditionally

competition clauses. competition clauses. As Mitchell Mitchell made made clear, clear, while while non-competition non-competition agreements agreements

are narrowly construed construed because because they constrain productive productive activity activity (what (what the trial

court appears court appears to addressing in to be addressing in findings findings 7, 7, 9 and 11), 11), (RR (RR III, III, 16-17);

16-17); nonnon -

non-circumvention agreements disclosure and non-circumvention agreements are broadly construed because they

protect things protect things known known to to the parties —

the parties the protected — the protected party's party’s interest interest in his in his

contractual agreements, agreements, his customers, customers, his financing sources — things considered

secret and proprietary. (RR III, 17, 168-170).

proprietary. (RR

27

Here, the Agreement Here, Agreement in no way way restricts restricts Pro-Tech'

Pro-Tech’ss ability ability to perform its

usual services, usual services, whether whether they be be oil oilchanges/windshield changes/windshield wiper wiper replacement, replacement, it

Pro-Tech’ss unauthorized simply prohibits Pro-Tech' unauthorized use use (in (in whatever whatever form form that may take) of

Madison’s confidential EJ Madison's confidential trade secret information outside of the Project and/or to

circumvent EJ circumvent Madison. (RR EJ Madison. (RRIV, IV,Plt.'s Plt.’sEx.

Ex.1)1) (Recitals (Recitals 91¶1-3)

1-3)(Agreement (Agreement91 ¶

TheAgreement 1(d)(e)). The Agreement restricted restricted use use of of the the confidential confidential information to "project-

“project-

related business,” related business," i.e., Pro-Tech Pro-Tech “was the EL "was not permitted to use the EL Hollingsworth Hollingsworth

contact for contact for anything anythingoutside outsidethe theproject.”

project." (RR (RR III, III, 26);

26); (RR (RR IV, IV, Plt.’s Ex. 1)

Plt.'s Ex.

(Agreement ¶911(d)(e)). (Agreement 1(d)(e)). Additionally, Additionally,Pro-Tech Pro-Techwas was free free to to do business with EL do business

Hollingsworth inin whatever Hollingsworth whateverform formas as long long as it obtained as it obtained EJ EJ Madison's Madison’s written written

(R III, authorization. (R III, 87, 165-166).

The record here contains The contains ample ample evidence evidence that EJ EJ Madison's Madison’s relationship relationship

with EL Hollingsworth constituted its valuable trade secret information whether as

a customer, financial partner or contractual contractual relationship relationship and that the the introduction introduction

was made only after EJ Madison and EL Hollingsworth had entered into their own

confidentiality and confidentiality and non-circumvention non-circumventionagreement.

agreement. Further, EJ Madison made the

introduction to Pro-Tech in reliance introduction reliance on on Pro-Tech'

Pro-Tech’ss promises in the Agreement—

Agreement—

and would not have made made itit otherwise otherwise (RR (RR III, III, 65, 65, 67, 67, 68, 68, 69). Again, because of 69). Again,

considerable time the considerable money aa company time and money company spends spends to to develop develop relationships, relationships,

contractual relationships, contractual relationships, customers customersand/or and/or contacts, contacts,itit is is imperative, imperative, and and was was to

28

Warren and EJ Madison, that same same remain remain protected protected trade trade secret secret information.

information. (RR

III 69). III 69). Furthermore, Furthermore, the theTUTSA TUTSAprotects protects broad broadcategories categories of ofinformation information

(including potential (including potential customers)

customers)where wherethe theowner ownerof of the trade secret the trade secret has taken taken

reasonable measures reasonable measures to to keep keep the information information secret secret and the information information was not

generally known generally known to to the person person to who is in aa position position to to derive derive economic economic benefit benefit

it.44 from it.

There is simply There simply no no question question but but that thatEL ELHollingsworth Hollingsworth constituted constituted EJ EJ

Madison’s trade Madison's trade secret secret information information (as its its customer customer or or potential potential customer), customer), which

Madison had taken reasonable EJ Madison reasonable efforts efforts to protect protect (via the Agreement Agreement and the

timing of the timing the disclosure), disclosure), that the the information information was was previously previously unknown unknown to Pro-

Pro-

Tech, and from from which which itit stood, stood, and and did, did,derive deriveeconomic economicbenefit.

benefit. (RR III, 65, 67,

68, 69, 83, 124, 140-141) (RR IV, IV, Plt.’s Plt.'s Ex. 5).

Therefore, as Therefore, as to Findings Nos.

to Findings Nos. 7, 11, reviewing 7, 9 and 11, reviewing the instrument instrument as a

whole in whole in an effort effort to to harmonize harmonize and give effect and give effect to all the to all the provisions provisions of of the the

4 4 The Texas Uniform Trade Secret Secret Act Act defines defines “trade "trade secret”

secret" as: "Trade secret" means all forms as: "Trade types of and types of information, information, including including business, business, scientific, scientific, technical, technical, economic, economic, or or engineering engineering information, and information, formula, design, and any formula, design, prototype, prototype, pattern, pattern, plan, plan, compilation, compilation, program program device, device, program, code, device, method, technique, process, procedure, financial data, technique, process, procedure, financial data, or or list of actual or potential customers potential customers or or suppliers, suppliers, whether whether tangible tangible or or intangible intangible and whether or how and whether how stored, stored, compiled, or memorialized physically, electronically, graphically, photographically, or in writing the owner if: (A) the owner ofof the the trade trade secret secret has has taken taken reasonable reasonable measures measures under under the the circumstances circumstances to keep the information secret; and (B) the information derives independent economic value, actual potential, from not being or potential, being generally generally known to, and and not not being being readily readily ascertainable ascertainable through through proper means means by, another person person who can obtain economic economic value value from from the disclosure disclosure or use of the information. Tex.

Tex. Civ.

Civ. Prac.

Prac. && Rem.

Rem. Code § 134A.002(6).

29

Agreement, the Agreement, the restrictions restrictions relate relate not Pro-Tech’ss services, not to Pro-Tech' services, but rather, EJ but rather, EJ

Madison’s trade Madison's trade secret information.

Furthermore, as Furthermore, as to Finding Finding No. 8, because because the Agreement Agreement neither refers to

Pro-Tech’ss ability to provide services outside the Project as nor purports to restrict Pro-Tech'

long it does long does not not violate violate the thenon-use non-use orornon-circumvention non-circumvention provisions, provisions, to assert assert

“additional consideration" "additional consideration” was required improperly improperly supplies supplies terms not contained contained

within the Agreement and which are outside outside the record.'5 the record.

Likewise, in regard to Finding No. 10, the Agreement does not require that

Madison provide EJ Madison provide to to Pro-Tech Pro-Tech“a "a written writtencopy copyofofits its customer customerlist.” the list." On the

contrary, the Agreement protects the disclosure, in whatever whatever form, form, of of EJ EJ Madison’s Madison's

confidential information. confidential information.(RR (RRIV, IV, Plt.’s Plt.' s Ex.Ex.

1) 1) (Recitals (Recitals ¶¶ 2-3;Agreement 9[912-3; Agreement ¶¶ 1-

9191

Furthermore, as 2). Furthermore, as set setforth forthabove, above,even evenpotential potential customers, customers, and and arguably arguably EL

Hollingsworth as a contact, Hollingsworth contact, potential potential customer, customer, customer, customer, contractual contractual relationship relationship

and/or financing partner, constitutes protected trade secret information.

information. See n. 3

supra.

IX. There Thereis islegally legallyand andfactually factuallyinsufficient insufficientevidence evidence to to support support the court’s finding no. 12 that Plaintiff did not incur attorney’s court's attorney's fees.

5 5 The record is devoid of any evidence at trial regarding any failure of consideration and, thus, the issue thus, issue was/is was/is arguably arguably not before before the the trial trial court court or or this thisCourt.

Court.Moreover, Moreover, defendant defendant although it pled although pled lack lack of of consideration consideration failed failed to to verify verify its itspleading.

pleading.LackLackofofconsideration consideration for a contract is an affirmative contract affirmative defense to its its enforcement.

enforcement. Mclemon Mclemon v. Dynegy Inc., 347 S.W.3d 315 (Tex.

App.—Houston [14th App.—Houston [14th Dist.]

Dist.] 2011, no pet.) (See Tex.R. Civ.

Civ. P. 94; Kaye/Bassman Kaye/Bassman Intern.

Intern. Corp.

Corp. v. Help Inc., 321 Desk Now, Inc., Desk S.W.3d 806, 321 S.W.3d 806, 814 (Tex.App.-Dallas 2010, 814 (Tex.App.-Dallas 2010,pet.

pet.denied).

denied). It must be pleaded It must pleaded by verified denial. Tex.

Tex. R.

R. Civ. Proc. 93(9).

30

X. There is legally and factually insufficient evidence to support the court’s lack court's lack of finding finding No.

No. 12 12 that that Plaintiff Plaintiff alleged alleged its its entitlement entitlement to attorney’s fees, attorney's fees, and parties agreed and the parties agreed that attorney's attorney’s fees fees would would be proven in a separate separate hearing.

hearing. [Amended No. 12]

The record conclusively proves the parties stipulated stipulated that that attorney’s attorney's fees would

be addressed be addressed in in aa separate separatehearing.

hearing. (RR (RR III, III, 103).

103). ItItappears appears the the trial trial court court

overlooked the overlooked the stipulation stipulationof ofthe theparties partiesininthis thisregard.

regard. In any event, there is no

evidence support the finding (or lack thereof) or the finding (or the lack thereof) is

against the against great weight the great weight and and preponderance preponderance such such that that the matter should the matter should be be

remanded for a hearing hearing on on Plaintiff’s Plaintiff's attorney’s attorney's fees.

such, there As such, there is is simply simply no noprobative probative evidence, evidence, or or reasonable reasonable inferences inferences

therefrom, which therefrom, supports the above findings.

which supports findings. Hydrocarbon Hydrocarbon Management, Inc.,

861 S.W.2d 861 S.W.2d at 431. Thus, at 431. Thus,the thefindings findings are arelegally legally insufficient insufficient to to support support the the

judgment, and judgment, Appellant’s "no-evidence"

and Appellant's “no-evidence” points should be points should be sustained.

sustained.

Alternatively, viewing Alternatively, viewing the the Agreement Agreement as as aa whole, whole, the the evidence evidence supporting supporting the

findings is so weak and against the great weight and preponderance of the evidence

be clearly as to be clearly and and manifestly manifestly wrong such that same same are are factually factually insufficient insufficient to

support the judgment. Id.

CONCLUSIONS OF LAW

court erred XI. The court erred as as a matter matter of law in its conclusion conclusion of law no. 1 breach the that Defendant did not breach the Non-Disclosure Non-Disclosure Non Non Circumvention Circumvention Agreement.

31

XII. The court erred as a matter of law in failing to find, or in its lack Defendant’s failure to turn over the profits, benefits and of finding, that Defendant's proceeds of its commercial relationship with EL Hollingsworth does not constitute breach breach of of fiduciary fiduciaryduty. [Additional no. 6]

duty. [Additional

court erred XIII. The court erred as as a matter matter of law in its conclusion conclusion of law no. 2 that there that there is is no no language language in inthe theNon-Disclosure Non-Disclosure Non NonCircumvention Circumvention Agreement reflecting Agreement reflecting an an intent intent that that services services not related to nor arising not related arising from the from the conversion conversion process process constitute constitute trade secrets secrets or or confidential confidential financial and business information.

court erred XIV. The court erred as as a matter matter of law in its conclusion conclusion of of law no. 3 that the terms of the Non-Disclosure Non Circumvention Agreement did not prohibit Defendant from entering into a business business relationship with E.L. Hollingsworth E.L. Hollingsworth to provide mechanical to provide mechanical services services unrelated unrelated to the to the conversion process.

court erred XV. The court erred as as a matter matter of law in its conclusion conclusion of law no. 4 Defendant did not utilize that Defendant utilize Plaintiffs'

Plaintiffs’ trade trade secrets secrets or or confidential confidential financial and financial business information and business information inin entering entering into into aa business business relationship with E.L. Hollingsworth to provide mechanical services.

court erred XVI. The court erred as as a matter matter of law in its conclusion conclusion of law no. 5 that Plaintiff's that Plaintiff’s claim claimforfor breach breach of contract fails of contract fails for lack of for lack of consideration.

The legal The legal conclusions conclusions of of the trial court the trial court are not not binding binding on on the the appellate appellate

court; appellate court; appellate courts courts are are free free to draw draw their their own own legal legal conclusions conclusions and and review review

those conclusions those conclusions de novo.

de novo. Hydrocarbon Hydrocarbon Management, Management,Inc.

Inc. v. Tracker v. Tracker

Exploration, Inc., 861 S.W.2d 427, 431 (Tex. App.—Amarillo 1993, no writ); see

also Austin Hardwoods, Inc. v. Vanden Berghe, 917 S.W.2d 320, 322 (Tex. App.—

1995, writ denied).

El Paso 1995, denied). When When aaparty party requests requests findings findings and and the the court court files files

them, the court of appeals can presume that omitted findings support the judgment

32

only when (1) an element of the ground of recovery was included in the findings of

fact, (2) the fact, the omitted omitted element element was was not not properly properly requested, requested, and and (3) the the omitted omitted

finding is supported supported by by the the evidence. Tex. R. Civ. Proc. 299; American Nat’l evidence. Tex. Nat'l Ins.

Co. v. Paul, 927 S.W.2d 239, 245 (Tex. App.—Austin 1996, writ denied.

Conclusions Nos. 1-5 (and Lack of Finding as to Breach of fiduciary Duty)

In its Conclusion of Law No. 1, the trial court found:

Defendant Defendant did not breach did not breach the the Non-Disclosure Non-Disclosure Non Non Circumvention Circumvention Agreement.

(CR II, (CR II, 6). For Forthe thereasons, reasons,and andbased based on onthe theevidence, evidence, set set forth forth above above (in (in

Appellant’s argument Appellant's argument related related to to the the court’s findings of fact), i.e., a review of the court's findings

provisions of the Agreement, provisions Agreement, it is clear clear Pro-Tech Pro-Tech breached the non-use and non-

circumvention terms circumvention terms of Agreement when of the Agreement when it began began doing doing non-project non-project related related

business with EL Hollingsworth. As aa matter Hollingsworth. As matter of of law, law, harmonizing harmonizing the terms of the

Agreement, itit is readily Agreement, readily apparent apparent the Agreement Agreement protected protected the disclosure of EJ the disclosure

Madison’s confidential Madison's confidential information information (here, its relationship relationship with EL EL Hollingsworth)

Hollingsworth)

against unauthorized against unauthorized use use and/or and/or circumvention circumventionby by Pro-Tech. When Pro-Tech Pro-Tech. When Pro-Tech

began doing business with EL Hollingsworth without EJ Madison’s authorization, Madison's authorization,

non-circumvention provisions it breached the non-use and non-circumvention provisionsof of the the Agreement.

Agreement. As

such, Pro-Tech is liable for breach of contract.

The trial The trial court's court’s Conclusion Conclusion of of Law Law No. finding no No. 1 finding no breach breach does does not not

specifically address specifically addressAppellant’s Appellant'sbreach breachofof fiduciary fiduciary duty duty cause action.

cause of action.

33

However, after However, after the trial court the trial court filed filed its its findings, findings, Appellant Appellant timely timely filed filed its its

“Plaintiff’s Request "Plaintiff's Request for Amended Findings for Amended Findings of Fact and of Fact and Conclusions Conclusions of Law”

of Law"

wherein it requested an additional conclusion of law as follows:

[Additional] 6. [Additional] 6. Defendant’s Defendant's failure failure to to turn the profits, turn over the profits, benefits benefits and and proceeds of its proceeds its commercial commercial relationship relationship with Hollingsworth does with EL Hollingsworth does not constitute breach of fiduciary duty.

(CR II, 8-11). Thus, Thus, Appellant Appellant can can challenge challenge lack of this finding. See e.g., Vickery

Commission for Lawyer v. Commission Lawyer Discipline, S.W.3d 241, Discipline, 5 S.W.3d 241, 254 254 (Tex.App.—Houston (Tex.App.—Houston

[14th Dist.] 1999, 1999, pet.

pet. denied). Thesame denied). The samefacts factsand andreasoning reasoning which which evidence evidence and

Pro-Tech’ss failure to turn over the support breach of contract likewise support that Pro-Tech'

proceeds constitutes breach of its fiduciary duty.

In its Conclusion of Law No. 2, the trial court found:

There is no language in the Non-Disclosure Non Circumvention Agreement reflecting an intent that services not related to nor arising conversion process constitute trade secrets from the conversion secrets or or confidential confidential financial and business information.

(CR II, 6).

In its Conclusion of Law No. 3, the trial court found:

The terms ofofthethe The terms Non-Disclosure Non Non-Disclosure NonCircumvention Circumvention Agreement did Agreement Defendant from entering did not prohibit Defendant entering into a business business relationship relationship with E.L. Hollingsworth to provide provide mechanical mechanical services services unrelated to the conversion process.

(CR II, 6).

In its Conclusion of Law No. 4, the trial court found:

34

Defendant Defendant did not utilize did not utilize Plaintiffs'

Plaintiffs’ trade trade secrets secrets or or confidential confidential financial and financial business information and business information in entering into in entering into aa business business relationship with E.L. Hollingsworth to provide mechanical services.

(CR II, 7).

In its Conclusion of Law No. 5, the trial court found:

Plaintiff’s Plaintiff's claim for breach of contract fails for lack of consideration.

(CR II, 7).

Furthermore, the Furthermore, the Agreement Agreementdoes does not not address address nor nor purport purport to restrict, or to restrict,

Pro-Tech’ss non-project classify as protected trade secrets, Pro-Tech' non-project related related services services so as to

somehow act somehow act as a "non-competition"

“non-competition” clause. Conclusions of law Nos. 2-4 which clause. Conclusions

Pro-Tech’ss “competition”

are premised on a non-existent provision prohibiting Pro-Tech' "competition" are

manifestly wrong as a matter of law and should be reversed.

Finally, for Finally, for the reasons reasons forth forth in the argument argument related related to the finding of fact

trial court's no. 8, the trial court’s conclusion conclusion of law no. 5 that that EJ EJ Madison's Madison’s claim claim fails for

lack of consideration is without basis as a matter of law and should be reversed.

XVII. The court erred as a matter of law in its conclusion of law no. 6 alleged trade that the alleged trade secret secret information information was readily readily ascertainable ascertainable by proper means, such as availability in trade journals, reference books, or published materials.

XVIII. The court erred erred as a matter of law in its its conclusion conclusion of law no. 77 that that the thealleged allegedproprietary proprietary information information was was not not substantially substantially secret.

35

The alleged trade secret information was readily ascertainable proper means, by proper means, such such as as availability availability in in trade trade journals, journals, reference reference books, or published materials.

The alleged proprietary The alleged proprietary information information was not not substantially substantially secret.

(CR II, 7). First, First, there there is is no no evidence in the record to support support these these conclusions.

conclusions. In

fact, as noted above, Rivera admitted he did not know of EL Hollingsworth prior to

the introduction the introduction by by Warren. (RR III, Warren. (RR III, 124).

124). Moreover, Moreover,such suchinformation information fits fits

squarely into the definition squarely definition of what constitutes constitutes a protected trade secret under the

Tex. Civ. Prac.

TUTSA. See Tex. Prac. & Rem.

Rem. Code Code § 134A.002(6).

134A.002(6). These These findings findings are

unsupported as a matter of law and should be reversed.

The court XIX. The court erred as a matter matter of law in its its conclusion conclusion of law no. 8 that Plaintiff is not entitled to any damages, actual or punitive.

In its Conclusions of Law No. 8, the trial court found:

Plaintiff is not entitled to any damages, actual or punitive.

(CR II, 7). The The trial trial court's court’sconclusion conclusionin in this this regard regard is is necessarily necessarily premised on its

factual findings findings of of no breach breach and no misappropriation misappropriation of of trade trade secrets. Appellant secrets. Appellant

would submit the court’s factual findings on the elements of breach of contract and court's factual

fiduciary duty, fiduciary duty, as well as as well as misappropriation misappropriation of trade secrets, of trade secrets, are legally legally and and

factually sufficient such that they should be reversed and, alternatively, remanded.

Additionally, EJ Additionally, EJ Madison Madison proved proved itit was was damaged damaged pursuant pursuant to to the terms of

the Agreement in the amount of the proceeds it provided that Pro-Tech had a duty

36

turnover in to turnover the event in the event of of aabreach.

breach. Pro-Tech'

Pro-Tech’s owninvoicing s own invoicing records records for for

maintenance provided maintenance providedtoto EL Hollingsworth, beginning EL Hollingsworth, beginningJuly July 21, 2014 and 21, 2014 and

extending through extending through May May 22, 22, 2015, 2015, reflect reflect a total of of $212,290.09, $212,290.09, for an an average average

monthly revenue revenue paid paid by by EL EL Hollingsworth Hollingsworthof of$21,229.09. (RR III, $21,229.09. (RR III, 83, 140-141);

Plt.’ss Ex.

(RR IV, Plt.' Ex. 5). This number 5). This number isis consistent consistent with with the the amount amount incurred incurred by EJ

Madison prior Madison prior to to EL EL Hollingsworth Hollingsworthassuming assumingoperations.

operations.(RR (RRIII, III,83, 83,141).

141). EJ

Madison, at Madison, highest point, at its highest point, compromised compromised 10 15 percent 10 to 15 percent of ofPro-Tech'

Pro-Tech’ss

business or business approximately 2.5 or approximately 2.5 million million dollars dollarsin in annual annual sales. (RR III, sales. (RR III, 141-143, 141-143,

Riveraacknowledged 163). Rivera acknowledged that that Pro-Tech Pro-Tech began began doing doing maintenance maintenance work for EL

Hollingsworth on Hollingsworth on or or about about August August 1, 1, 2014 2014 and and continued continued to to do do so so at the time of

(RR III, trial. (RR III, 119).

Pro-Tech’ss invoicing, the proceeds represent $212,290.09 through Based on Pro-Tech'

May 2015 May 2015 and and $21,229.09 $21,229.09 each each month month thereafter thereafter through through time time of trial of trial

($504,498.16)6 and ongoing. ($504,498.16)6 ongoing. (RR (RR 153).

153). This Thisfinding findingshould should be be reversed reversed and and the

issue remanded issue remanded to to the trial court for for aa determination determination as to to future future damages, damages, i.e.,

beyond the date of trial.

XX. The court erred erred as a matter of law in its conclusion conclusion of law no. 9 that Pursuant to §38.001 et seq., Tex. Civ. Prac. & Rem. Code, Plaintiff is not entitled to attorney’s attorney's fees.

In its Conclusions of Law No. 9, the trial court found:

6 6 $21,229.09 multiplied $21,229.09 multiplied by by the number of months the number months (24)

(24) beginning beginning June June 2015 2015 and and extending through May 2017.

37

Pursuant Pursuant to to §38.001 §38.001 et seq., Tex.

et seq., Tex. Civ. Prac.

Prac. & & Rem.

Rem. Code, Code, Plaintiff is not entitled to attorney’s attorney's fees.

(CR II, 7). The Therecord record conclusively conclusively proves proves the parties stipulated that attorney’s attorney's

fees would be addressed addressed in in aa separate separatehearing.

hearing. (RR III, 103). As set 103). As set forth above, it

appears the appears the trial trial court court overlooked overlooked the the stipulation stipulationof ofthe theparties partiesininthis thisregard.

regard. In

conclusion is contrary the parties stipulation and any event, as a matter of law this conclusion

should be reversed.

PRAYER

For these For these reasons, reasons, Appellant Appellant respectfully respectfully requests requeststhat that the trial court's the trial court’s

judgment be judgment reversed, alternatively, be reversed, alternatively, remanded remandedtotothe the trial court for trial court for further further

proceedings and that Appellant be awarded its costs of court.

TROY C. BROWN Attorney at Law 300 E. Main 10th Floor, Suite 1000 El Paso, Texas 79901 Phone: (915)

(915) 543-9669 543-9669 Fax: (888)

(888) 922-3353 922-3353 E-mail: troy@tcblegal.com troy@tcblegal.com

/s/Troy IslTroy C. Brown________________ Brown TROY C. BROWN State Bar Number 00783735 Attorney for Appellant

38

CERTIFICATE OF SERVICE

I hereby certify that a true and correct copy of the foregoing instrument was served on the 21st day of May May 2018, 2018, to:

to: Mannie Mannie Kalman, Kalman, 1214 1214 Montana Montana Avenue, Paso, Texas El Paso, Texas 79902, 79902, pursuant pursuant to the the Court's Court’s Notice Notice of ofElectronic Electronic Procedures Procedures established established forforthethe El El Paso Paso County County Courts Courts via via e-mail:

e-mail:

mkalman@manniekalman.com.

/s/Troy IslTroy C. Brown________________ Brown Troy C. Brown

CERTIFICATE OF COMPLIANCE

I hereby certify that the foregoing Appellant’s Appellant's Brief contains 8,209 words.

/s/Troy IslTroy C. Brown________________ Brown TROY C. BROWN

IN THE COURT OF APPEALS EIGHTH DISTRICT OF TEXAS EL PASO, TEXAS

_____________________________________________________

08-17-00229-CV NO. 08-17-00229-CV

EJ MADISON, LLC.

v.

PRO-TECH DIESEL, INC.

_____________________________________________________

TH Appealed from the 205 205TH Judicial District Court of El Paso County, Texas

_____________________________________________________

APPENDIX

_____________________________________________________

Judgment (August 3, 2017) (Ex. A)

Tex. Govt. Code §554.002 (Ex. B)

Excerpts from Tea.texas.gov (Ex. C)

El Paso County - 205th District Court Filed 8/11/2017 3:16 PM Norma Favela Barceleat District Clerl, El Paso Count 2015DCV247E IN THE DISTRICT COURT OF EL PASO COUNTY, TEXAS 205TH JUDICIAL DISTRICT

El MADISON, LLC., a Texas limited liability company, SOUTHWEST TRUCK LEASING, a Texas Limited liability company, and LIM LEASING, LLC, a Texas limited liability company Plaintiffs,

v. Cause No. 2015-DCV2479

PRO-TECH DIESEL, INC., Defendant.

FINAL JUDGMENT

On the date set forth below, came on to be heard the above entitled and numbered cause;

Plaintiffs EJ MADISON, LLC, SOUTHWEST TRUCKING LEASING, and RIM LEASING,

LLC, appeared through its attorney of record; Defendant PO-TECH DIESEL, INC., appeared

through its attorney of record. All matters in controversy, legal and factual, were submitted to

the court for its determination. The court heard the evidence and arguments of counsel and

announced its decision for the Defendant.

The court orally RENDERED judgment for Defendant on June 20, 2017. This written judgment

memorializes that rendition.

IT IS accordingly ORDERED, ADJUDGED AND DECREED that the Plaintiff take nothing by

its suit.

All relief not expressly granted herein is denied.

Signed on this 3.- day o , 2017.