Fiberwave v. AT&T Enterprises

Texas Business Court

Fiberwave v. AT&T Enterprises

2025 Tex. Bus. 42

Texas Business Court·Decided October 29, 2025·No. 25-BC01A-0013·Published·Cited by 1 cases

Opinion

FILED IN

BUSINESS COURT OF TEXAS

BEVERLY CRUMLEY, CLERK

ENTERED

10/29/2025

2025 Tex. Bus. 42

The Business Court of Texas, First Division

FIBERWAVE, INC., § Plaintiff/Counter-Defendant, § v. § AT&T ENTERPRISES, LLC, § Defendant/Counter- § Plaintiff/Third-Party § Cause No. 25-BC01A-0013 Plaintiff, § v. § SPEARHEAD NETWORKS § TECH, INC., FAISAL § CHAUDHRY, and CHRIS PERCY, § Third-Party Defendants. §

═══════════════════════════════════════ Memorandum Opinion and

Partial Summary Judgment on Plaintiff’s Tort Claims ═══════════════════════════════════════

Before the Court is Defendant AT&T Enterprises, LLC’s Motion for Partial Summary Judgment on Plaintiff’s Tort Claims. Defendant (AT&T) contends Plaintiff’s (Fiberwave’s) tortious interference with contract, defamation, and business disparagement claims are barred by the limitation-

of-liability provision in the parties’ 2022 Alliance Program Agreement (the Agreement). The motion is GRANTED IN PART AND DENIED IN PART.

I. Section 18.6 of the Agreement does not bar Fiberwave’s claims because its damages did not arise from AT&T’s termination of the Agreement.

Section 18.6 of the limitation-of-liability provision in the Agreement is not ambiguous and can be construed as a matter of law. See Great Am. Ins. Co. v. Primo, 512 S.W.3d 890, 893 (Tex. 2017) (noting that “the goal of contract interpretation is to ascertain the parties’ true intent expressed by the plain language they used”). That section states:

UPON TERMINATION OF THIS AGREEMENT PURSUANT TO THE TERMINATION RIGHTS SET FORTH IN THIS AGREEMENT, NEITHER PARTY WILL BE LIABLE TO THE OTHER, EITHER FOR COMPENSATION OR FOR DAMAGES OF ANY KIND OR CHARACTER WHATSOEVER ARISING FROM SUCH TERMINATION, WHETHER ON ACCOUNT OF THE LOSS BY AT&T OR SP OF PRESENT OR PROSPECTIVE PROFITS ON SALES OR ANTICIPATED SALES, OR EXPENDITURES, INVESTMENTS OR COMMITMENTS MADE IN CONNECTION THEREWITH, OR IN CONNECTION WITH THE ESTABLISHMENT, DEVELOPMENT OR MAINTENANCE OF SP’S BUSINESS, OR ON ACCOUNT OF ANY OTHER CAUSE OR THING WHATSOEVER, EXCEPT THAT TERMINATION WILL NOT PREJUDICE OR OTHERWISE AFFECT THE RIGHTS OR LIABILITIES OF THE PARTIES WITH RESPECT TO ACTIVITIES PRIOR TO SUCH TERMINATION.

AT&T’s Appx. Ex. 1, Pg. APP025 (emphasis added).

AT&T contends that Fiberwave’s tort claims are barred under Section 18.6 because they arise from AT&T's termination of the Agreement. The Court is not persuaded. Importantly, the question is not whether AT&T’s complained-of acts arose from the termination of the Agreement, but whether Fiberwave’s damages did.

AT&T’s argument hinges on the breadth of the phrase “arising from such termination.” Interpreting a similar phrase, the Texas Supreme Court has held “the phrase ‘arise out of’ simply requires showing a causal connection or relation . . . ” Yowell v. Granite Operating Co., 620 S.W.3d 335, 353 (Tex. 2020); see also Utica Nat’l Ins. Co. of Tex. v. Am. Indem. Co., 141 S.W.3d 198, 203 (Tex. 2004). Earlier this year, the Business Court observed that “courts interpret ‘arising out of’ as denoting a broad causal relationship—akin to ‘but for’ causation instead of the narrower and limiting linkage required of ‘proximate’ causation.” Atlas IDF, LP v. NexPoint Real Est. Partners, LLC, 2025 Tex. Bus. 16, ¶ 29 (1st Div. 2025).

Admittedly, but-for causation “has in itself no limiting principle; it literally embraces every event that hindsight can logically identify in the causative chain.” Plains Expl. & Prod. Co. v. Torch Energy Advisors Inc. (Plains

Exploration), 473 S.W.3d 296, 308 (Tex. 2015) (quoting Moki Mac River Expeditions v. Drugg, 221 S.W.3d 569, 581 (Tex. 2007)). However, phrases such as “arise from” cannot be viewed “divorced from their surroundings.” Id. at 309.

In Plains Exploration, the Supreme Court rejected expansive interpretations of the phrases “arising from,” “with respect to,” and “attributable to” where broad but-for causation would have led to an illogical and unreasonable result: inconsistency with the parties’ expressed intent. Id. at 308-09. The Court noted that a broad but-for causal standard—in that case, one allowing “everything in existence or previously occurring . . . [to] be a but for cause of all that follows”—would render temporal divisions elsewhere in the contract “utterly meaningless.” Id. at 309. The Court explained, “To give effect to the words the parties chose, there must be more than a simple causal connection.” Id.

“[W]hen parties narrow the scope of their rights and obligations purposefully, the Court must enforce the terms expressed within the four corners of the contract.” Yowell, 620 S.W.3d at 353. Here, as in Plains Exploration, other language in the Agreement requires a similarly tapered

reading of “arising from.” Specifically, Section 18.6 must be read in context with Section 18.2 of the Agreement, wherein the parties used the words “arising out of or related to” rather than simply “arising from.” See infra, Pg. 7; AT&T’s Appx. Ex. 1, Pg. APP025. The added language, “related to,” means “‘a connection with or reference to.’” Colorado v. Tyco Valves & Controls, L.P., 432 S.W.3d 885, 890 (Tex. 2014) (quoting Shaw v. Delta Air Lines, Inc., 463 U.S. 85, 96-97 (1983)). Its ordinary meaning does not require a causal relationship. Shaw, 463 U.S. at 97 n.16. As such, the phrase “arising out of or related to” is interpreted more broadly than “arising from.”

So while it is true that the but-for causal standard may “embrace[] every event that hindsight can logically identify in the causative chain,” Plains Exploration, 473 S.W.3d at 308 (quoting Moki Mac River Expeditions, 221 S.W.3d at 581), the parties’ use of “arising from” here must be read more narrowly. Doing so rightfully preserves the meaningful difference reflected in the two phrases used in the Agreement: “arising from” in Section 18.6 and “arising out of or relating to” in Section 18.2. See Brittingham v. Mirabent, No. 04-17-00028-CV, 2017 WL 2852627, at *5 (Tex. App.—San Antonio July 5, 2017, no pet.) (mem op., not designated for publication). A broader

interpretation, such as that urged by AT&T—encompassing every logically connected event subsequent to its termination of the Agreement—would improperly negate the distinction in the parties’ word choice. Accordingly, the Court finds that “arising from” in Section 18.6, viewed in context, has limits, and cannot be interpreted broadly enough to support AT&T’s argument that, but for the termination of the 2022 [Alliance Program] Agreement, Fiberwave would not have sustained any of its claimed damages.1 The Court concludes that Section 18.6 does not categorically bar Fiberwave’s claims for damages attributable to AT&T’s (alleged) post- termination acts, namely: issuance of a press release, communication via email, and publication on a website. While AT&T may not have committed the complained-of acts but for the termination, Fiberwave’s pleading seeks damages attributable to the complained-of acts, and not attributable to the

1 Unlike in cases involving arbitration clauses, public policy also weighs against a broader interpretation here because Section 18.6 could operate as a prospective, intentional tort exculpation clause. See Zachry Constr. Corp. v. Port of Houston Auth. of Harris Cnty., 449 S.W.3d 98, 116 (Tex. 2014) (holding pre-injury contractual waivers of future liability for intentional or reckless torts void and unenforceable for public policy reasons). Cf., e.g., Plains Exploration, 473 S.W.3d at 308 (citing In re Dillard Dept. Stores, Inc., 186 S.W.3d 514, 516 (Tex. 2006)).

termination. The Court therefore holds that AT&T’s motion for partial summary judgment must be denied as to arguments raised under Section 18.6.

II. Section 18.2 is an enforceable bar on incidental, consequential, and indirect damages, and consequently forecloses any recovery for business disparagement as a matter of law.

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