Elite Auto Body LLC, D/B/A Precision Auto Body Rey R. Hernandez Yesica Diaz And David Damian v. Autocraft Body Works, Inc., Now Known as Wasson Road Ventures, Inc. D/B/A Autocraft Bodywerks

Court of Appeals of Texas·Decided April 21, 2015·No. 03-15-00064-CV·Published

Opinion

ACCEPTED 03-15-00064-CV 4967054 THIRD COURT OF APPEALS AUSTIN, TEXAS 4/21/2015 11:11:07 AM JEFFREY D. KYLE NO. 03-15-00064-CV CLERK

FILED IN IN THE COURT OF APPEALS FOR THE3rd COURT OF APPEALS THIRD DISTRICT OF TEXAS AUSTIN, TEXAS AT AUSTIN, TEXAS 4/21/2015 11:11:07 AM JEFFREY D. KYLE Clerk

ELITE AUTO BODY LLC d/b/a PRECISION AUTO BODY, REY R. HERNANDEZ, YESICA DIAZ, AND DAVID DAMIAN, Appellants

v. AUTOCRAFT BODYWERKS, INC. Appellee

ON APPEAL FROM THE 345th JUDICIAL DISTRICT COURT TRAVIS COUNTY, TEXAS TRIAL COURT CAUSE NO. D-1-GN-14-004535 HONORABLE TIM SULAK, PRESIDING JUDGE

BRIEF OF APPELLEE

James G. Ruiz State Bar No. 17385860 jruiz@winstead.com · WINSTEAD PC 401 Congress A venue, Suite 2100 Austin, Texas 78701 (512) 370-2800 (512) 370-2850 (facsimile)

ATTORNEYS FOR .APPELLEE

ORAL ARGUMENT REQUESTED

1 IDENTITIES OF PARTIES AND COUNSEL

The following is a complete list of the names of all parties affected by the trial court's Order Denying Defendants' Motion to Dismiss Pursuant to Chapter 27 of the Texas Civil Practice and Remedies Code and their trial and appellate counsel:

APPELLANTS: Elite Auto Body, LLC d/b/a Precision Auto Body, Rey R. Hernandez, Yesica Diaz, and David Damian

TRIAL & APPELLATE COUNSEL:

Rick Harrison Sam King Dale L. Roberts FRITZ, BYRNE, HEAD & HARRISON, PLLC 98 San Jacinto Blvd., Suite 2000 Austin, Texas 78701 (512) 476-2020 (512) 477-5267-Fax

APPELLEE: Autocraft Bodywerks, Inc.

TRIAL & APPELLATE COUNSEL:

James G. Ruiz Jacylyn G. Austein WINSTEAD PC 401 Congress A venue, Suite 2100 Austin, Texas 78701 (512) 370-2800 (512) 370-2850 -Fax

11 STATEMENT REQUESTING ORAL ARGUMENT

Appellee herein requests the Court grant oral argument on the appeal of this matter.

111 STATEMENT OF THE CASE

Nature of the Case: Autocraft Bodywerks, Inc. brought suit against Appellants for misappropriation of trade secrets, violation of Chapter 134A of the Texas Civil Practice & Remedies Code, unfair competition, breach of fiduciary duty, and civil conspiracy arising out of David Damian's wrongful disclosure and use of Autocraft's confidential business and trade secret information after the termination of employment to provide his new employer, Precision Auto, an unfair advantage in the marketplace. In the present action, Autocraft seeks to enjoin any future improper disclosure and use by Appellants of its confidential business information and trade secrets. Appellants sought to dismiss the suit under§ 27.003 of the Texas Civil Practice & Remedies Code asserting that Autocraft' s action attempts to interfere in their right to free speech and free association. The trial court denied Appellants' motion to dismiss.

Trial Court: The Honorable Tim Sulak, Presiding Judge for the 345th Judicial District Court of Travis County, Texas.

Trial Court Disposition: The trial court entered its Order Denying Defendants' Motion to Dismiss Pursuant to Chapter 27 of the Texas Civil Practice and Remedies Code.

Parties in the Court ofAppeals: Appellants- Elite Auto Body, LLC d/b/a Precision Auto Body, Rey R. Hernandez, Yesica Diaz, and David Damian

Appellee- Autocraft Bodywerks, Inc.

IV TABLE OF CONTENTS

IDENTITIES OF PARTIES AND COUNSEL ........................................................ II

STATEMENT REQUESTING ORAL ARGUMENT ........................................... .III

STATEMENT OF THE CASE .............................................................................. IV

BRIEF OF APPELLEE .....................................................................-........................ 1

ISSUES PRESENTED .............................................................................................. 2

STATEMENT OF FACTS ........................................................................................ 3

SUMMARY OF ARGUMENT ................................................................................. 5

ARGUMENT ........................................................................................-..................... 7

I. STANDARD OF REVIEW ............................................................................. 7

II. TRIAL COURT CORRECTLY DENIED APPELLANTS' MOTION TO DISMISS UNDER CHAPTER 27 OF THE TEXAS PRACTICE & REMEDIES CODE BECAUSE APPELLANTS FAILED TO MEET THEIR BURDEN OF PROOF ........................................................................ 8

A. AUTOCRAFT'S MISAPPROPRIATION OF TRADE SECRETS, UNFAIR COMPETITION, AND BREACH OF FIDUCIARY DUTY CLAIMS DO NOT IMPLICATE THE TCPA ..................................................................................................... 8

1. PRIVATE SPEECH NOT PROTECTED UNDER THE TCPA ........ 10

2. THE TCP A DOES NOT PROTECT THE DISCLOSURE OF TRADE SECRETS ............................................................................. 13

B. EVEN IF THE TCPA WERE OTHERWISE APPLICABLE TO AUTOCRAFT'S TORT CLAIMS, THE COMMERCIAL SPEECH EXCEPTION IN §27 .01 O(b) PREVENTS DISMISSAL ... 17

III. EVEN ASSUMING THE TCPA APPLIES TO APPELLEE'S CLAIMS, AUTOCRAFT MET ITS BURDEN OF PROOF TO PREVENT DISMISSAL OF ITS CLAIMS ..................................................................... 28

v PRAYER .................................................................................................................. 25

CERTIFICATE OF SERVICE ................................................................................ 26

CERTIFICATE OF COMPLIANCE ....................................................................... 27

VI TABLE OF AUTHORITIES

Page(s) Am. Motors Corp. v. Huffstutler, 575 N.E.2d 116 (Ohio 1991) ................................... 14

Anderson Chern. Co. v. Green, 66 S.W.3d 434 (Tex. App.-Amarillo 2001, no pet.) ........................................................................................................... 16, 22, 23

BBB of Metro Houston, Inc. v. John Moore Servs., Inc., 441 S.W.3d 345 (Tex. App.-Houston [1st Dist.] 2013, pet. denied) ................................................... I2

Cain v. Rust Indus. Cleaning Servs., Inc., 969 S.W.2d 464 (Tex. App.-Texarkana 1998, pet. denied) ............................................................................. 24

Cheniere Energy, Inc. v. Lotfi, 449 S.W.3d 210 (Tex. App.-Houston [1st Dist.] 2014, no pet.) ............................................................................................... 8, 12

Cherne Indus. Inc. v. Grounds & Assocs., Inc., 278 N.W.2d 81 (Minn. 1979) .................................................................................................................. 14, 15

Cohen v. Cowles Media Co., 501 U.S. 663 (1991) .......................................................... 14

Combined Law Enforcement Ass 'n of Tex. v. Sheffield, No. 03-13-00105- CV, 2014 WL 411672 (Tex. App.-Austin Jan. 31, 2014, pet. filed) .................. 12

Computer Assoc. Intl., Inc. v. Altai, Inc., 918 S.W.2d 453 (Tex. 1996) ..................... 22

Coward v. Gateway Nat'! Bank, 525 S.W.2d 857 (Tex. 1975) ..................................... 19

Dodson v. Watson, 220 S.W.

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Elite Auto Body LLC, D/B/A Precision Auto Body Rey R. Hernandez Yesica Diaz And David Damian v. Autocraft Body Works, Inc., Now Known as Wasson Road Ventures, Inc. D/B/A Autocraft Bodywerks, (Tex. Ct. App. 2015).

Elite Auto Body LLC, D/B/A Precision Auto Body Rey R. Hernandez Yesica Diaz And David Damian v. Autocraft Body Works, Inc., Now Known as Wasson Road Ventures, Inc. D/B/A Autocraft Bodywerks (Elite Auto Body LLC, D/B/A Precision Auto Body Rey R. Hernandez Yesica Diaz And David Damian v. Autocraft Body Works, Inc., Now Known as Wasson Road Ventures, Inc. D/B/A Autocraft Bodywerks) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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