Integrity Global Security, LLC And Green Hills Software, Inc. v. Dell Marketing L.P., a Texas Limited Partnership, Dell Federal Systems, L.P., a Texas Limited Partnership And Dell Products, L.P., a Texas Limited Partnership

• Court: Court of Appeals of Texas
• Decided: January 10, 2018
• Docket: 03-17-00483-CV
• Status: Published

Opinion

ACCEPTED 03-17-00483-CV 21751755 THIRD COURT OF APPEALS AUSTIN, TEXAS 1/10/2018 8:49 PM JEFFREY D. KYLE CLERK No. 03-17-00483-CV

FILED IN IN THE THIRD COURT OF APPEALS 3rd COURT OF APPEALS AUSTIN, TEXAS 1/10/2018 8:49:07 PM JEFFREY D. KYLE INTEGRITY Global Security, LLC and Green Hills Software, Clerk Inc.,

Appellants,

v.

Dell Marketing L.P., Dell Federal Systems, L.P., and Dell Products, L.P.,

Appellees.

On Appeal from the 345th Judicial District Court, Travis County, Texas Trial Court Cause No. D-1-GN-16-000345

APPELLANTS’ REPLY BRIEF

Dale Wainwright Frank E. Merideth, Jr. State Bar No. 00000049 [Pro Hac Vice] wainwrightd@gtlaw.com meridethf@gtlaw.com Alan W. Hersh GREENBERG TRAURIG, LLP State Bar No. 24080944 1840 Century Park East, Suite 1900 hersha@gtlaw.com Los Angeles, California 90067 GREENBERG TRAURIG, LLP Telephone: (310) 586-7825 300 West 6th Street, Suite 2050 Facsimile: (310) 586-0275 Austin, Texas 78701 Telephone: (512) 320-7200 Facsimile: (512) 320-7210 COUNSEL FOR APPELLANTS INTEGRITY GLOBAL SECURITY, LLC AND GREEN HILLS SOFTWARE, INC.

ORAL ARGUMENT REQUESTED TABLE OF CONTENTS

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

INTRODUCTION ..................................................................................................... 1

RESPONSE TO STATEMENT OF FACTS ............................................................. 2 ARGUMENT ............................................................................................................. 6

I. Dell’s Statement of Issues does not Address Matters that are the Important Issues in this Case. .......................................................................... 7 II. Dell’s Summary of the Argument Presents Dell’s Spin on Appeal Issues................................................................................................................ 8

III. Dell’s Statement of the Standard of Review for Summary Judgment is Incomplete in Material Respects. .................................................................... 8

IV. Appellees’ Brief Fails to Address IGS’ Evidentiary Objections..................... 9

V. Dell Completely Ignores IGS’ Summary Judgment Evidence. ....................... 9 VI. Sections 4 and 5 of the Third Amendment are part of an Integrated Agreement and Address the Same Subject Matter. ....................................... 10 VII. Dell’s Shifting Statute of Limitations Analysis is Flawed. ........................... 12

VIII. Business and Commerce Code Section 271.001 is Inapposite and Does Not Support Dell’s Argument that Delaware Law Applies to the Statute of Limitations. ................................................................................... 16

IX. Dell’s Argument Regarding Texas Civil Procedure and Remedy Code § 16.064 is Wrong.......................................................................................... 17

X. Dell’s Analysis on the Accrual Statute of Limitations is Incorrect............... 25

XI. The Court Should Have Addressed the Motion to Amend on its Merits. ............................................................................................................ 26 XII. Dell’s Argument on the Motion to Amend Erroneously Assumes the Trial Court Ruled on IGS’ Motion to Amend. .............................................. 29

ii XIII. The Trial Court Should Have Granted IGS’ Motion for New Trial. ............. 31 CONCLUSION ........................................................................................................ 31

CERTIFICATE OF COMPLIANCE ....................................................................... 32

CERTIFICATE OF SERVICE ................................................................................ 32

iii INDEX OF AUTHORITIES

Page(s)

Cases Austin v. Countrywide Home Loans, 261 S.W.3d 68 (Tex. App.—Houston [1st Dist.] 1995, pet. denied) ................. 30 Bagwell v. Ridge at Alta Vista Invs. 1, LLC, 440 S.W.3d 287 (Tex. App.—Dallas 2014, pet. denied)..............................28, 29

Crandal Med. Consulting Servs. v. Harrell, No 03-07-00689-CV, 2009 WL 280658 (Tex. App—Austin Feb. 5, 2009, pet. denied)............................................................................................ 9, 24 Healthronics, Inc. v. Lisa Laser USA, Inc., 382 S.W.3d 567 (Tex. App.—Austin 2012, no pet.) .......................................... 12

Hill v. Milani, 678 S.W.2d 203 (Tex. App.—Austin 1984) ....................................................... 30 Hussong v. Schwan’s Sales Enters., 896 S.W.2d 320 (Tex. App—Houston [1st Dist.] 1995, no writ) ...................... 30 Lubbock Cty., Tex. v. Trammel’s Lubbock Bail Bonds, 80 S.W.3d 580 (Tex. 2002)................................................................................. 25 Monsanto Co. v. Boustany, 73 S.W.3d 229 (Tex. 2002)................................................................................. 14 Sandt v. Energy Maint. Servs. Grp. I, LLC, __ S.W.3d __, 2017 WL 31884747 (Tex. App.—Houston [14th Dist.] 2017, no pet.) ............................................................................................ 13

Swilley v. McCain, 374 S.W.2d 871 (Tex. 1964) .............................................................................. 14 In re United Servs. Auto. Ass’n, 307 S.W.3d 299 (Tex. 2010) ............................................................18, 19, 20, 21

Valance Operating Co. v. Dorsette, 164 S.W.3d 656 (Tex. 2004) .............................................................................. 20

iv Waffle House v. Williams, 313 S.W.3d 796 (Tex. 2010) .............................................................................. 31

Western-Southern Life Assurance Co. v. Kaleh, 193 F. Supp. 3d 756 (S.D. Tex. 2016) ..........................................................13, 17

Williamson v. John Deere Co., 708 S.W.2d 38 (Tex. App.—Tyler 1986, no writ) .......................................24, 25

Ziegler v. Bank of Am. Nat’l Trust & Savings Ass’n, 182 F.3d 913 (5th Cir. 1999) .............................................................................. 13

Statutes Tex. Bus. & Com. Code § 271.001 .......................................................................... 16

Tex. Bus. & Com. Code § 271.004 .......................................................................... 16 Tex. Bus. & Com. Code § 271.005(a)(1)................................................................. 16

Tex. Civ. Prac. & Rem. Code § 16.064 ............................................................passim Tex. Loc. Gov’t. Code § 89.004(a) .......................................................................... 25

Other Authorities Restatement (Second) of Conflicts of Law, § 142 .....................................2, 7, 14, 15 Restatement (Second) of Conflicts of Law, § 187 ............................................... 2, 13

Restatement (Second) of Conflicts of Law, § 6 ....................................................... 14

Tex. R. Civ. P. 63 ..................................................................................................... 28 Tex. R. Civ. P. 166a ................................................................................................... 9

Tex. R. Civ. P. 166a(c) ............................................................................................ 28

Tex. R. Civ. P. 324(b)(1) ......................................................................................... 31

v Appellants INTEGRITY Global Security, LLC and Green Hills Software,

Inc. (collectively “IGS”) reply to Appellees Dell Marketing L.P., Dell Federal

Systems L.P. and Dell Products L.P.’s (collectively “Dell”) Appellees’ Brief

(“Appellees’ Brief”).

INTRODUCTION IGS’ Opening Brief demonstrated that the Trial Court (i) failed to consider

and rule on IGS’ evidentiary objections to Dell’s Summary Judgment Evidence;

(ii) based its Summary Judgment Order on inadmissible evidence; (iii) failed to

consider IGS’ Summary Judgment Evidence which identified disputed issues of

material fact; (iv) erroneously decided the statute of limitations and breach of

contract issues; (v) failed to consider IGS’ Motions to Amend and Stay; and

(vi) erred in denying IGS’ Motion for a new trial. As shown by this Reply, Dell’s

Appellees’ Brief fails to address issues (i)-(iii) and is wrong on the facts and law

with regard to issues (iv)-(vi).

Dell’s restated Facts and its Summary of the Argument are replete with

inadmissible parol evidence; unsupported characterizations; and argument about

the parties’ unstated purposes, intentions, and expectations regarding the parties’

Agreements, and should not be considered on appeal.

Dell’s Argument, in addition to relying on inadmissible evidence and

characterized “facts,” ignores or glosses over troublesome issues like IGS’ Objections and Motion to Strike to Dell’s inadmissible Summary Judgment

Evidence, IGS’ Disputed Issues of Fact and the Trial Court’s “rush to judgment”

urged by Dell to emasculate IGS’ right to amend its Petition.

Furthermore, Dell shifts its choice of law analysis from its position in the

Trial Court, walking back its prior contention that the parties agreed that

Delaware’s statute of limitations would apply, and instead relies on the

Restatement (Second) of Conflicts of Law, § 187’s “states’ interest analysis.”

However, the Texas Supreme Court has expressly declined to adopt the

Restatement (Second) of Conflicts of Law, § 142 regarding the statute of

limitations, and overwhelming precedent establishes that for suits filed in Texas,

Texas’s statute of limitations apply, regardless of the parties’ choice-of-law

provisions.

Finally, Dell’s Argument gives only lip service to the legal standards for

appellate review of summary judgment, the amendment of pleadings and motions

for new trial all of which are critical to this appeal.

These flaws in Dell’s factual and legal analysis are addressed below.

RESPONSE TO STATEMENT OF FACTS Dell’s Statement of Facts mischaracterizes the operative Agreements, relies

on inadmissible parol evidence, and makes assumptions and assertions that are not

2 supported by admissible evidence. IGS timely objected in the Trial Court to the

use of such inadmissible evidence and objects to its use in Appellees’ Brief.

Specifically, Dell argues in its Statement of Facts:

1. “The parties’ purpose in entering into the Original Agreement was to

market the DISCC solution to government agencies operating in Top Secret

Environments, which would require Top Secret certification.” Appellees’ Brief

p. 1 ¶ 2 (emphasis added). The parties’ purpose in entering into the Agreements is

parol evidence. Further, it is not a “fact” that is stated in any of the parties’

Agreements and it is not supported by any citation to the record. Finally, it is

undisputed that the Original Agreement was superseded and was of no force or

effect.

2. “Because DISCC had not received Top Secret Certification, Dell had

sold no licenses by June 2010, leaving Dell with a $10 million inventory of prepaid

licenses.” Appellees’ Brief p. 2 ¶ 1. The sale of licenses by Dell was never a

requirement in any of the Agreements. Under the terms of the Original

Agreement, Top Secret Certification was not expected until August 2010. Dell

being “left with $10 million of inventory” in June 2010 is a pejorative statement

which is a prelude to Dell’s argument and groundless excuse for stopping

payments to IGS because Dell never received a “return on its investment.”

3 3. “Like with the Original Agreement, the purpose of the Restated

Agreement was to sell DISCC to government agencies operating in Top Secret

environments.” Appellees’ Brief p. 2 ¶ 1 (emphasis added). That “purpose” is not

stated anywhere in the Original or Restated Agreements. Dell’s statement of the

parties’ “purpose” in entering into the Agreements is parol evidence. In fact, the

third “WHEREAS” clause of the Restated Agreement recites the purpose:

WHEREAS, on May 12, 2009, IGS and Dell executed a Global Alliance Agreement (“Original Agreement”) establishing an alliance (“Alliance”) to jointly innovate and cooperate in the development and marketing of superior security products and services targeted at governmental and general purpose enterprise computing, servers, thin clients and workstations through both the installation of INTEGRITY PC and INTEGRITY CSE (as defined below) through Dell’s Custom Factory Integration process.

(CR 434).

4. “The MLC payment schedule under the Restated Agreement was

revised . . . . to allow time for the generation of post-Top Secret certification sales

and revenues to offset the higher MLC payments due later.” Appellees’ Brief p. 3

¶ 1. This reason for the revision of Table 2 is not reflected in the Restated

Agreement or the Third Amendment, and is inadmissible parol evidence.

5. “By January Top Secret Certification still had not occurred, and the

parties entered into an Amendment Three . . . .” Appellees’ Brief p. 3 ¶ 1. This

parol evidence does not appear in the Third Amendment, and it unfairly

characterizes the situation at the end of 2010 that required the Third Amendment,

4 specifically the parties’ need to replace AFRL with NASIC as a DISCC sponsor,

the software upgrade requirements of NASIC and the introduction by Dell of new

versions of Optiplex 980 and 990 computers.

6. “It [the Restated Agreement] provided that upon any such termination

‘Dell’s MLC shall terminate.’” Appellees’ Brief p. 3. This repeated assertion

regarding Dell’s disputed view of its obligation to pay $6 million required by the

Third Amendment is incomplete and incorrect under the express terms of both the

Restated Agreement and the Third Amendment. To be accurate, this assertion

must reference the language of Section 11.12 of the Restated Agreement which

states: Dell’s “obligation to pay amounts due hereunder shall survive expiration or

termination of this Agreement and shall continue in full force and effect.” (CR

452).

7. The Third Amendment also “created an additional MLC payment”

and a “new payment.” Appellees’ Brief p. 3 (emphasis added). These are Dell’s

characterizations of the Third Amendment, which are not supported by the plain

language of the agreements.

8. “The parties’ agreement [lower case in original] continued to provide

that upon termination ‘Dell’s MLC shall terminate.’” Appellees’ Brief p. 3. This

paraphrase is misleading because it omits reference to Section 11.12 of the

Restated Agreement. (CR 452).

5 9. “By this point [August 2011], Dell had paid IGS approximately $18

million in MLC payments without seeing any return on its investment.”

Appellees’ Brief p. 4. None of the parties’ Agreements refer to or mention Dell

“seeing any return on its investment” let alone condition MLC payments on such a

return. None of the Agreements provide that Dell can suspend or terminate the

Agreements if it failed to see any return on its investment.

10. “On August 10, 2011, Dell sent IGS a suspension-of-payment letter.”

Appellees’ Brief p. 4. There is no provision in the Agreements for a “suspension-

of-payment letter” or any other procedure to suspend or terminate the Agreements

before the end of the On-Hold Time Frame for any reason.

11. “By the end of October 2011, Top Secret certification still had not

been obtained by IGS.” Appellees’ Brief p. 4 (emphasis added). Neither the

Restated Agreement nor the Third Amendment require IGS to obtain Top Secret

certification. This statement is parol evidence. Appellees’ Brief p. 4.

ARGUMENT As evident from Dell’s Response, the bases for which it sought summary

judgment are grounded largely in Dell’s self-serving recollection of the parties’

intent, rather than the plain language of the contract itself. Furthermore, given that

Dell has effectively conceded there is a material issue of fact regarding its right to

suspend its contractual payments, Dell’s sole basis for affirming summary

6 judgment as to those payments is a statute of limitations issues. In order to support

that position, Dell asks this Court to ignore well-established precedent that Texas

law governs the applicable statute of limitations, and instead apply § 142 of the

Restatement (Second) of Conflicts of Law. Similarly, Dell asserts that IGS was

required to review all of the Dell entity’s various tax filings in the off-chance that

such filings might contravene the apparent complete diversity between the parties.

Such argument finds no support in case law, and turns a presumption of equitable

tolling under section 16.064 of the Texas Civil Practice & Remedies Code on its

head.

I. Dell’s Statement of Issues does not Address Matters that are the Important Issues in this Case. Subsections a.-c. of Dell’s, Issue 1 (Appellees’ Brief p. ix) are based on

Dell’s rank speculation regarding what the Trial Court’s reasons may have been for

granting summary judgment. In fact, no reasons for the Trial Court’s decision

were stated in the Order.

Issue 2 is based on speculation since the Trial Court’s Order is on “all

grounds” and does not carve out the “isolated arguments” Dell withdrew.

Appellees’ Brief p. ix.

Regarding Issue 3, Dell erroneously states the issue to be whether the Trial

Court abused its discretion by not granting the Motion to Amend. Appellees’ Brief

p. ix. In fact, the Trial Court, at Dell’s urging, believed it could avoid ruling on the

7 Motion to Amend by rushing to sign the order less than a week before the

scheduled hearing on the Motion to Amend.

Issue 4 is flawed because its premise, that Muehleman’s testimony was

cumulative (Appellees’ Brief ix), is false. Muehleman’s testimony (that the

Parties’ Agreements were terminated) conflicted directly with Peterson’s testimony

(that the Parties’ Agreements merely were suspended).

In contrast to Dell’s recast issues, the IGS Issues Presented fairly presents

the key issues to be decided in this case. Appellants’ Brief, p. xiv.

II. Dell’s Summary of the Argument Presents Dell’s Spin on Appeal Issues. Dell’s Summary of the Argument relies heavily on the inadmissible

evidence recited in the Statement of Facts and is not substantiated by a single

reference to the record. The alleged “facts” Dell relies on in its Summary of the

Argument are loaded and the conclusions are unwarranted.

III. Dell’s Statement of the Standard of Review for Summary Judgment is Incomplete in Material Respects. Dell agrees that review of a summary judgment is de novo. Appellees’ Brief

p. 14. However, Dell does not reference or address the basic principles for such

review of Summary Judgment as set forth in IGS’ Opening Brief:

1. The Summary Judgment Evidence considered by the Trial Court must be admissible evidence;

2. The Reviewing Court must take evidence favorable to the non-movant to be true;

8 3. The Reviewing Court must indulge in every favorable inference in favor of the non-movant;

4. The Reviewing Court must resolve any doubts in favor of the non- movant;

5. The movant must demonstrate there are no genuine issues of material fact; and

6. The movant must show it is entitled to judgment as a matter of law. See Tex. R. Civ. P. Rule 166a; Crandal Med. Consulting Servs. v. Harrell, No 03-07-00689-CV, 2009 WL 280658, at *3 (Tex. App— Austin Feb. 5, 2009, pet. denied) (collecting cases).

Appellants’ Brief pp. 18-20.

IV. Appellees’ Brief Fails to Address IGS’ Evidentiary Objections. IGS’ Opening Brief points out that IGS timely objected and moved to strike

Dell’s inadmissible summary judgment evidence. Appellants’ Brief pp. 23-38.

Dell attempts to duck this key point by arguing that it withdrew “isolated

arguments in its motion for summary judgment, thereby [making] the evidence

supporting those arguments irrelevant and immaterial to the motion. . . .”

Appellees’ Brief pp. ix 2, 44-45. But, in fact, as demonstrated in IGS’ Response to

Statement of Facts, paragraphs 1-11, and throughout the Argument in this Reply,

Dell is still trotting out the same inadmissible evidence in support of the Argument

in the Appellee’s Brief.

V. Dell Completely Ignores IGS’ Summary Judgment Evidence. IGS’ Opening Brief lists eighteen Disputed Issues of Fact that are supported

by admissible Summary Judgment Evidence. Appellants’ Brief pp. 29-38. The

9 Trial Court ignored those Disputed Issues of Fact, and so does Appellees’ Brief.

Admissible conflicting evidence must be considered as summary judgment

evidence and cannot be summarily dispatched by the characterizations offered by

Dell that such evidence consists of “cryptic statements” or “gross misreadings” of

the evidence. Id.

VI. Sections 4 and 5 of the Third Amendment are part of an Integrated Agreement and Address the Same Subject Matter. Dell argued on summary judgment that the provisions of the Third

Amendment are ambiguous as to whether Dell was required to make the $1.75

million and $1.25 million payment to IGS, but regarding the payment of the $6

million to IGS, the contract is unambiguous. Rather than citing to any specific

contract language, Dell merely characterizes the $6 million payment as a “new

MLC payment.” In fact, all three payments totaling $9 million are part of the total

$11,250,000 of MLC payments that Dell was already obligated to pay to IGS under

the terms of the Restated Agreement, and are the same amounts Dell is obligated to

pay under the inter-related provisions of Sections 4 and 5 of the Third Amendment.

(CR 439, 461).

None of the provisions in Sections 4 and 5 are ambiguous, and neither

paragraph creates a “new MLC payment.” Both sections describe precisely Dell’s

obligation to pay IGS $11,250,000 of MLC payments due during the On-Hold

Time Frame pursuant to paragraph 2.2.3 of the Restated Agreement for Periods 3,

10 4 and 5 (January 29, 2011 through October 28, 2011). (CR 461). These payment

obligations under Section 11.12 of the Restated Agreement survive termination.

(CR 452). With regard to Dell’s promised payments, IGS was required to continue

to grant Dell Top Secret Exclusivity through November 30, 2011 and make the

deliverables described in paragraph 3 of the Third Amendment. Dell now admits:

“[t]he Restated Agreement Amendment Three expressly required IGS to deliver

the third deliverable and grant Top Secret Exclusivity to sell during the On-Hold

Time Frame.” Appellees’ Brief p. 20. It is undisputed that the deliverables were

made on time and accepted by Dell and that IGS granted Dell Top Secret

Exclusivity though November 30, 2011.

Whether the Agreements were terminated in August 2011, as testified by

Muehleman,1 or suspended in August as claimed by Peterson, the point is Dell

stopped paying IGS in August 2011, which was a material breach that entitled IGS

to terminate or suspend performance during the On-Hold Time Frame. (CR 462);

see also Dell’s Letter Suspending Payments (CR 499-500). Based on Dell’s

promises, IGS continued to perform. If the Restated Agreement and Third

Amendment were terminated, as Muehleman testified, then there was nothing to

terminate on November 30, 2011. If the Agreements were suspended, as Peterson

1 Dell claims IGS’ position is based on a “gross misreading,” of Muehleman’s testimony. IGS quoted Muehleman’s testimony verbatim in its Motion to Amend, its Motion for New Trial and Appellants’ Brief and attached copies of the relevant transcript. (CR 668-71, 791-805).

11 testified, then IGS contends that Dell was equitably estopped to terminate without

cause for the reasons set forth in the Opening Brief.

Under Restated Agreement Section 2.2.3, the MLC payment for each period

is specified in Table 2. (CR 440). Sections 4 and 5 of the Third Amendment

change this procedure with respect to the $3,750,000 per quarter MLC payments

during the On-Hold Time Frame. (CR 834).

Recognizing that none of the Delaware substantive law it cites change the

terms of the Restated Agreement or the Third Amendment, Dell attempts to side-

step Section 11.12 of the Restated Agreement by mischaracterizing Section 5 of

the Third Amendment regarding the $6 million Dell obligation as creating a “new

MLC.” As shown by the Opening Brief, there is no basis for such a

mischaracterization. The $6 million obligation survives termination of the

Restated Agreement as provided in Section 11.12 and was an obligation of Dell

due under the Agreements.

VII. Dell’s Shifting Statute of Limitations Analysis is Flawed. As this Court has repeatedly stated, where the parties’ contract contains a

choice-of-law provision, the court will apply that state’s law to substantive issues,

“and Texas law to procedural questions.” Healthronics, Inc. v. Lisa Laser USA,

Inc., 382 S.W.3d 567, 577 (Tex. App.—Austin 2012, no pet.) (collecting cases).

Furthermore, because statute of limitations are a question of “remedy and

12 procedure,” rather than substantive law, Texas courts and federal courts applying

Texas law have repeatedly recognized that Texas’s statute of limitations applies to

Texas lawsuits, regardless of the parties’ choice-of-law contract provision. See

Sandt v. Energy Maint. Servs. Grp. I, LLC, __ S.W.3d __, 2017 WL 31884747, at

*7 (Tex. App.—Houston [14th Dist.] 2017, no pet.) (noting statute of limitations is

“procedural in nature”); Western-Southern Life Assurance Co. v. Kaleh, 193 F.

Supp. 3d 756, 770–71 (S.D. Tex. 2016) (expressly applying Texas statute of

limitations over choice-of-law provision); Ziegler v. Bank of Am. Nat’l Trust &

Savings Ass’n, 182 F.3d 913, 914 (5th Cir. 1999).

Dell attempts to sidestep this precedent by grossly overstating that “[t]he

parties made it clear that they intended for Delaware law to apply broadly to

matters relating to their agreement and that any general choice of law rule that may

require the application of the laws of another jurisdiction should not be given

effect.” Appellees’ Brief p. 27. The parties did not make this “clear” in any of

their Agreements. This is, at best, parol evidence. Section 11.2 expresses no such

intent and is expressly limited by its terms to the “validity, construction, scope and

performance of the Agreement . . . .” (CR 451).

In the Trial Court, Dell relied on § 187 of the Restatement (Second) of

Conflict of Law, contending the parties agreed Delaware law applied to both

substantive and procedural matters, including the statute of limitations. (CR 610).

13 No such “agreement” is reflected in any of the parties’ Agreements and is parol

evidence. In Section 11.2, the parties designated specifically what provisions of

Delaware law applied—and did not include the statute of limitations. (CR 451).

Dell never acknowledged Sections 6 and 142 of the Restatement existed, let alone

applied in this case. However, Appellees’ Brief immediately shifts to a

Restatement (Second) Conflict of Law “interest analysis.” Specifically, Dell cites

Sections 6 and 142. In doing so, Dell admits Texas law does not recognize such an

analysis.

Section 142 of the Restatement specifically applies to statutes of limitations.

But Section 142 has not been accepted by the Texas Supreme Court, as Dell

concedes. Monsanto Co. v. Boustany, 73 S.W.3d 229, 233 (Tex. 2002) (declining

to adopt the Restatement (Second) of Conflicts of Law). While Dell expresses

hope that the Texas Supreme Court will adopt the § 142 in the future, since it has

not done so, this Court is bound by the doctrine of stare decisis to follow existing

Texas law. Generally, the doctrine of stare decisis dictates that once the Supreme

Court announces a proposition of law, “the decision is accepted as binding

precedent.” Swilley v. McCain, 374 S.W.2d 871, 875 (Tex. 1964).

Section 6 of the Restatement addresses general choice of law principals.

Section 142 addresses the statute of limitations. It provides:

Whether a claim will be maintained against the defense of the statute of limitations is determined under the principals stated in § 6. In

14 general, unless the exceptional circumstances of the case make such a result unreasonable:

(1) The forum will apply its own statute of limitations barring the claim.

(2) The forum will apply its own statute of limitations permitting the claim unless:

a. Maintenance of the claim would serve no substantial interest of the forum; and

b. The claim would be barred under the statute of limitations of a state having a more significant relationship to the parties and the occurrence. Restatement (Second) of Choice of Law, § 142 (emphasis added).

Section 142(2) requires the forum to apply its own statute of limitations

unless the exceptional circumstances of (a) and (b) are shown. Assuming

arguendo that Section 142 applies, Dell failed to offer any evidence or argument

regarding the “state interests” to be evaluated by the Trial Court, and does not

argue “exceptional circumstances” exist in this case in Appellees’ Brief.

Section 11.2 of the Restated Agreement requires that any action by IGS

against Dell must be filed in federal or state court, Austin, Texas, Dell’s principal

place of business. Obviously, Texas has a substantial interest in the resolution of

disputes of businesses in Texas and parties doing business here. Between Texas

and Delaware, Texas is the state with the most significant relationship to the

occurrence and the parties in the action, including: (i) the mandatory venue for

actions initiated by IGS is Texas; (ii) the Defendants are Texas limited partnerships

15 with their principal places of business and headquarters in Texas; (iii) the contract

negotiations were conducted in Texas; (iv) both Dell and IGS employ Texas

residents who were involved in DISCC; (v) the deliverables were to be made in

Texas; and (vi) the integration of DISCC into Dell Optiplex computers was to

occur in Texas.

In contrast, (i) the parties’ Agreements prohibit contract litigation in

Delaware; (ii) neither IGS nor Dell are headquartered in Delaware nor, to IGS’

knowledge, have offices, facilities or employees in Delaware; (iii) Delaware had

no connection with the negotiation or performance of the Agreements or the

dispute of the parties; and (iv) Delaware had nothing to do with DISCC. None of

the relevant “factors” demonstrate any exceptional circumstances that might favor

application of the Delaware statute of limitations over established Texas law,

assuming arguendo an “interests analysis” is required.

VIII. Business and Commerce Code Section 271.001 is Inapposite and Does Not Support Dell’s Argument that Delaware Law Applies to the Statute of Limitations. Dell’s reliance on Texas Business and Commerce Code § 271.001 et seq. is

unavailing because there is no “reasonable relationship” between the transaction at

issue and Delaware as required by § 271.004. Further, § 271.005(a)(1) applies to

an agreement of the parties for application of the law or a jurisdiction specific issue

in a qualified transaction and the transaction must bear a reasonable relationship to

16 that jurisdiction. There is no reasonable relationship between IGS and Dell

Agreements and Delaware. But most importantly here, the parties’ agreed in

Section 11.2 that Delaware law would apply only to issues related to “validity,

construction and performance” of the agreement, not to issues of remedy and

procedure. Specifically, there was no agreement that Delaware procedural law or

the Delaware statute of limitations would apply. (CR 451). Therefore, the plain

language of the parties’ contract does not support abandoning clear precedent that

Texas’s statute of limitations should apply, regardless of the existence of a choice-

of-law provision. Western-Southern Life Assurance Co., 193 F. Supp. 3d at 770–

71 (expressly applying Texas statute of limitations over choice-of-law provision).

IX. Dell’s Argument Regarding Texas Civil Procedure and Remedy Code § 16.064 is Wrong. Texas Civil Practice and Remedies Code § 16.064, which tolls the statute of

limitations for 60 days after a dismissal based on lack of jurisdiction, applies

unless there are facts showing the original filing was made with intentional

disregard of proper jurisdiction.2 The only “evidence” Dell cites as establishing

2 Dell did not offer any evidence showing IGS’ intentional disregard of jurisdiction. Certainly filing in one of the Texas federal or state jurisdictions required by the parties’ Agreement is not intentional disregard. Dell did not file the moving or opposing declarations or documents filed with the U.S. District Court and exhibits filed by the parties on which the federal court reached its conclusion. In the motion for summary judgment, Dell argued IGS acted “intentionally or negligently” in making its originally filing in federal court. (CR 85) Dell also argued that IGS “could easily have known the ownership structure of the Dell entities. . . .” But, IGS contended that there were internal inconsistencies that made the Secretary of State’s information unclear. It did not know the details of the complex ownership chain of the Dell

17 intentional disregard is the IGS’ federal complaint (CR 140-54) and the U.S.

District Court’s Order. (CR 156-60). The Order does not make any factual

findings other than its ultimate determination of the citizenship of the defendants

for federal diversity jurisdiction. Specifically, there is no finding in the U. S.

District Court was made as to the motive, intention or purpose of IGS in making

the filing in Federal Court. The Order demonstrates that there was a good faith

dispute between the parties as to the citizenship of “parent entities” of Dell for

purposes of diversity jurisdiction.

As the Texas Supreme Court has recognized, “section 16.064 was drafted

precisely because ‘capable lawyers’ often make ‘good faith’ mistakes about the

jurisdiction of Texas courts.” In re United Servs. Auto. Ass’n, 307 S.W.3d 299,

313 (Tex. 2010) (internal citations omitted). For this reason, the Court specifically

rejected the argument—now raised by Dell—that a legal mistake regarding a trial

court’s jurisdiction “would never satisfy the requirement” for tolling under this

equitable statute. Id. (noting that standard for intentional disregard “is similar to

that required to set aside a default judgment”). The Court went on to explain that

“the tolling statute protects plaintiffs who mistakenly file suit in a forum that lacks

entities until the Stidvent Declaration was signed and filed by Dell in the U.S. District Court. (CR 158-159, 86). Dell filed no evidence showing IGS knew the Dell limited partnerships and general partners were owned by another limited liability company which were owned by Dell Delaware limited liability companies and Dell corporations. This was a convoluted ownership structure which was not apparent without the Stidvent evidence. (CR 159).

18 jurisdiction, it does not apply to a strategic decision to seek relief from such a

court.” Id. Thus, the intentional disregard standard is implicated when a lawyer

knows or has clear reason to know that a trial court lacks jurisdiction, but chooses

to file suit in that court anyway for strategic advantage.

The jurisdiction and venue provisions of ¶ 11.2 of the Restated Agreement

require an action “[i]f filed first by IGS, [be] brought in the Texas State or Federal

Court in Travis County. . . .” (CR 461). It can be inferred from this provision that

both Dell and IGS had a good faith belief that jurisdiction was proper in the U.S.

District Court for the Western District of Texas Austin Division. IGS contends it

relied on that good faith belief in filing the federal action. However, the Federal

Court ruled that IGS “conflate[d] two different concepts,” and ruled that the parties

could not consent to federal jurisdiction, but rather, diversity of citizenship must be

determined at the time that the suit was filed. Order p. 4, n.1 (CR 159).

Dell’s Appellees’ Brief argues: “Dell argued and offered unrebutted

summary judgment evidence that IGS intentionally disregarded proper jurisdiction

with that federal filing, thereby precluding reliance on it to toll the statute of

limitations.” Appellees’ Brief, p. 12. However, no such Summary Judgment

Evidence is cited by Dell. And, in fact, no evidence was offered by Dell in the

federal court showing IGS intentionally disregarded proper jurisdiction. The

description of the Parties in the federal complaint is virtually identical to the

19 description of the parties in the Restated Agreement. (CR 343). No logical

conclusion of intentional disregard can be reached by considering that alleged

pleading error. Further, when reviewing a summary judgment, the reviewing court

must take all evidence favorable to the non-movant to be true, indulge in every

favorable inference and resolve all doubts in the non-movant’s favor. Valance

Operating Co. v. Dorsette, 164 S.W.3d 656, 661 (Tex. 2004).

The Appellees’ Brief relies on In re United Services Automobile Association,

307 S.W.3d 299 (Tex. 2010). In that case, the plaintiff filed an employment

discrimination action against his employer in Bexar County Court. The County

Court’s jurisdiction was limited to cases with damages of more than $500 but not

more than $100,000. The employee’s complaint alleged damages exceeding $500

but did not allege that the damages were less than $100,000. The employer,

believing the case involved far more than $100,000, moved twice to dismiss the

action, claiming the alleged damages exceed the jurisdictional limit. In response to

each motion, the plaintiff denied his damages exceeded the jurisdictional limit of

the court. The case was tried and a verdict for more than $800,000 (not including

punitive damages and attorneys’ fees) was returned in favor of plaintiff. The

Supreme Court reversed the judgment and dismissed the action because the

damages exceeded the jurisdictional limit of the county court.

20 Within 60 days the plaintiff refiled in the Bexar County District Court. The

employer moved for summary judgment based on the two-year statute of

limitations. The parties disagreed about the proper standard of care for “intentional

disregard.” The plaintiff, who never contended that he was confused or was

unaware of the jurisdictional limit of the county court, argued that Section 16.064

applied and intentional disregard was a factual issue for the jury to decide. The

employer contended it was a legal issue which could be decided on summary

judgment.

The Supreme Court held that the employer was required “to show in

abatement that the first filing was made with intentional disregard of proper

jurisdiction.” Id. at 312. Then “the non-movant must show that he did not

intentionally disregard proper jurisdiction when filing the case.” The Court held

that “while the tolling statute [Section 16.064] protects plaintiffs who mistakenly

file in a forum that lacks jurisdiction, it does not apply to a strategic decision to

seek relief from such a court—which is what happened here.” Id. at 313.

Dell posits merely legal conclusions, with no factual support, that it claims

show IGS “intentionally or negligently” filed in the wrong Court. (CR 86). Dell

concludes in Appellees’ Brief that IGS made a “strategic decision” to seek relief

from a court that did not have jurisdiction. These conclusions are not true.

The relevant facts are:

21 1. The Restated Agreement recites that the Dell parties are Texas limited

partnerships and that GHS and IGS are Delaware entities. (CR 434).

2. Paragraph 11.2 of the Restated Agreement requires that if Dell files

suit against IGS it must file in the U.S. District Court for the Central District of

California or the Superior Court for Santa Barbara County. If IGS files an action

against Dell, it must file either in the U.S. District Court in Austin or in the District

Court for Travis County. (CR 461).

3. From these provisions, it can be inferred that the parties believed that

there was diversity of citizenship between Dell and IGS regarding disputes arising

under their agreements. If they did not share that belief, they would not have

mandated actions be filed in the federal courts in their principal places of business

because complete diversity would be the only basis for federal jurisdiction.

4. The U.S. District Court order confirms that the parties filed opposing

memoranda and declarations supported by documentary evidence regarding their

opposing positions on diversity of citizenship. (CR 157-59). Dell did not file

copies of those pleadings as Summary Judgment evidence. It can be inferred from

this failure that the declarations and documents do not corroborate Dell’s “strategic

decision” claim.

5. Although the U.S. District Court ruled there was no diversity, it made

no factual or legal findings regarding either parties’ intentions or motivations. No

22 inference can be drawn from the ruling that IGS filed in the U.S. District Court

based on a strategic decision.

6. Dell did not allege “intentional disregard of jurisdiction” as an

affirmative defense in its Original or Amended Answer (CR 59) or in its Response

to Request for Disclosures (CR 921-31), i.e. a claim in abatement.

7. The Appellees’ Brief concedes that “[w]hile § 16.064 does suspend

the running of the statute of limitations between ‘the date of filing an action in a

trial court and the date of a second filing of the same action in a different court

under certain circumstances, it does not apply if the first filing was made with

intentional disregard of proper jurisdiction.’” Appellees’ Brief p. 37. Dell fails to

provide any evidence of intentional disregard, identify any of the “certain

circumstances,” or link them to the facts of this case. There is no “certain

circumstances” limitation to section 16.064.

8. The Restated Agreement and the U.S. District Court order

demonstrate that the parties were aware of the diversity of citizenship requirement

for federal jurisdiction, but, not being privy to the information contained in the

Stidvant Declaration on which the U.S. District Court relied, were mistaken as to

the citizenship of the ultimate owners of the Dell parties. (CR 158-59). Without

Stidvant’s Declaration—which was the Rosetta Stone to understanding the multi-

23 layered, highlight complex Dell ownership structure—IGS had no clear path to

determining the citizenship of the ultimate owners’ of the Dell entities pre suit.3

9. Dell offered no evidence that IGS knew of the ownership information

in the Stidvant Declaration before the Declaration was filed.

10. Dell made no effort to show through any facts or declarations that IGS

made a “strategic decision” to file in federal court knowing that court lacked

jurisdiction.

This is not the first instance in which a plaintiff unintentionally filed in

federal court, despite evidence that the plaintiff was mistaken as to complete

diversity of the parties. In Williamson v. John Deere Co., 708 S.W.2d 38, 38-39

(Tex. App.—Tyler 1986, no writ) the plaintiff filed a wrongful death action in the

U.S. District Court based on diversity jurisdiction, but alleged specifically that the

plaintiff was a Texas resident and one of the defendants was a Texas corporation.

The question on appeal was whether these facts demonstrated an intentional

disregard of jurisdiction as a matter of law. The Court held:

The case is one of first impression. The phrase “intentional disregard of jurisdiction” is not defined in the statutes nor in our case law. The only guidance that we have comes from Burford v. Sun Oil Co., 186 S.W.2d 306, 310 (Tex. Civ. App.—Austin 1944, writ ref’d w.o.m.), which states that art. 5539a is to be liberally construed to give relief

3 Given that Dell failed to include this Stidvant Declaration within its summary judgment motion—relying instead on a bald legal conclusion about its contents—the Court should view Dell’s representations with suspicion. Crandall Med. Consulting Servs., 2009 WL 280658, at *3 (noting that every reasonable inference is drawn in favor of nonmovant).

24 from the bar of limitation to one who has “mistakenly but in good faith” brought action in the wrong court.

The burden is on Austin and Deere to show that Williamson’s filing in federal court was in “intentional disregard of jurisdiction.” We hold that the affidavits filed by Williamson raise a genuine issue of fact as to whether or not Williamson, in filing her initial action in the United States District Court, did so as a result of a good faith mistake or in intentional disregard of jurisdiction, and that Deere and Austin have failed to establish as a matter of law that Williamson’s action was in “intentional disregard of jurisdiction.”

708 S.W.2d at 40. Likewise, Dell has failed here to show that IGS’ honest and

understandable mistake regarding the diversity of citizenship among the parties

constitutes intentional disregard of the federal court’s jurisdiction.

X. Dell’s Analysis on the Accrual Statute of Limitations is Incorrect. Lubbock County, Texas v. Trammel’s Lubbock Bail Bonds, 80 S.W.3d 580

(Tex. 2002)—cited in Appellees’ Brief—addresses a very specific and limited

issue under Texas Local Government Code § 89.004(a) relating to the pre-filing

presentment of claims to County Commissioners. The Supreme Court in Lubbock

County provided for a new rule for accrual of claims against county governments.

Section 89.004(a) does not apply to non-government claims, and Lubbock County

does not address accrual of the statute of limitations in a private contract that

expressly conditions commencing a lawsuit on initiation of a formal, presuit effort

to resolve the parties’ dispute through ADR.

The key issue under the ADR provision in the Restated Agreement is

whether the parties agreed that pre-filing ADR under § 8.1 is a mandatory

25 condition to filing a civil action. Restated Agreement § 8.1 (CR 445). The limited

exceptions in that section for filing preliminary equitable relief or to avoid the

expiration of a statute of limitations are inapplicable here, but even in such cases,

the Agreement requires “[t]he merits of the underlying dispute will be resolved in

accordance with this paragraph.” Section 8.2 provides that “[i]n the event the

Parties are unable to resolve the dispute within thirty days of notice of the dispute

to the other party, the Parties shall be free to pursue all remedies in law or in

equity.” Restated Agreement § 8.2 (CR 445).

XI. The Court Should Have Addressed the Motion to Amend on its Merits. On February 11, 2017 at the Tormaschy deposition, IGS requested that Dell

produce Muehleman for deposition testimony and asked for dates because

Muehleman was a Dell employee and this was the procedure followed by the

parties for all employee depositions. (CR 675-76).

After the Motion for Summary Judgment was argued, Dell finally agreed to

a deposition date and waived the discovery cutoff for that limited purpose. (CR

676). Two days after the Muehleman testimony (but before the Trial Court

Summary Judgment Order), Counsel for IGS wrote to the Trial Court advising of

the Muehleman testimony and its important impact on Summary Judgment:

We represent Plaintiffs in the above-referenced lawsuit. Defendants’ Motion for Summary Judgment hearing was heard by you on March 28, 2017, and is pending. Based on admissions of Frank Muehleman, Dell’s decision maker, during his deposition

26 testimony on April 19, 2017, that he terminated the Restated Agreement and the Third Amendment for cause, we intend to file a Motion for Leave to File a First Amended Petition on Monday, April 24, 2017. I write to alert you of our intent to file such a motion.

The new pleading will impact the issues addressed in the Summary Judgment Motion because the amended petition will allege that Dell terminated the Restated Agreement for cause in August 2011. . . . The April 19, 2017 deposition testimony creates a material issue of disputed fact regarding the nature and date of the termination and resulting damages . . . .

(CR 621-22).

On April 26, 2017, IGS filed its Motion for Leave to Amend Petition. (CR

624-82). The Motion alleges:

Plaintiffs seek leave to file their First Amended Petition after the deadline of April 6, 2017 and while Defendants’ motion is pending based on recent admissions in the Deposition testimony of Frank Muehleman on April 19, 2017, which was taken after the amended pleading cutoff and after the March 28, 2017 Motion for Summary Judgment hearing.

(CR 625).

On May 3, 2017, IGS moved to stay the proceedings, pending the

disposition of its Motion to Amend. (CR 683-709). On May 5, 2017, Dell emailed

the Trial Court’s assistant urging the Court to rule on the Motion for Summary

Judgment before the pending May 10, 2016 hearing on the Motion to Amend. The

email erroneously cites Automaker and argues that such a ruling would cut off

IGS’ right to amend under Rule 63. (CR 740-45).

27 On May 5, 2017, Dell filed the Proposed Order for Summary Judgment,

which was granted within minutes after the Court received IGS’ Objections on that

same date, which obviously were not considered by the Trial Court. (CR 740-45,

1320-27). Also, on that date IGS again requested a ruling on its Objections. (CR

710-34).

Rule 166a(c)(ii) specifically contemplates that a party may offer evidence

after the summary judgment hearing and before judgment, but permission of the

Court must be obtained to file such evidence. This procedure was thwarted here

because the Court ignored IGS’ Motions to Amend and to Stay and rushed to enter

its Order on Summary Judgment before the May 10, 2017 hearing date set for IGS’

Motion to Amend. It appears that the Court’s intent was to cut off any of IGS’

post-hearing attempts to offer evidence with permission of the Court. Because the

post-hearing evidence was offered via two written motions (the Motion to Amend

and the Motion to Stay), under Rule 166a(c), it can be considered on appeal in

determining whether the Trial Court abused its discretion.

IGS submits it can be inferred that the Trial Court’s rush to judgment was

intended to cut off any hearing on the amendment and was an abuse of discretion.

Bagwell v. Ridge at Alta Vista Invs. 1, LLC, 440 S.W.3d 287, 292 (Tex. App.—

Dallas 2014, pet. denied) (“An abuse of discretion occurs when the trial court acts

28 in an unreasonable and arbitrary manner, or when it acts without reference to any

guiding rules or principles.”).

Generally, a party may amend its pleadings at any time prior to seven days before trial unless the amended pleadings operate as a surprise to the opposing party. Tex. R. Civ. P. 63; Gunn, 397 S.W.3d at 377. That deadline may be altered by the trial court in a scheduling order issued pursuant to rule 166. Tex. R. Civ. P . 63; see also Tex. R. Civ. P. 166. A party may seek leave of court to amend its pleadings after the deadline imposed by a scheduling order entered pursuant to rule 166. Tex. R. Civ. P. 63. Leave “shall be granted” by the trial court “unless there is a showing that such filing will operate as a surprise to the opposing party.” Id. A trial court has no discretion to refuse an amended pleading unless (1) the opposing party presents evidence of surprise or prejudice; or (2) the amendment asserts a new cause of action or defense, and is thus prejudicial on its face, and the opposing party objects to the amendment. Halmos v. Bombardier Aerospace Corp., 314 S.W.3d 606, 622 (Tex.App.—Dallas 2010, no pet.).

Id. at 292-93. When the Summary Judgment Order was signed, Dell had not filed any

opposition to the Motion to Amend or raised in any other way that amendment

would operate as a surprise. (CR 1186-96).

XII. Dell’s Argument on the Motion to Amend Erroneously Assumes the Trial Court Ruled on IGS’ Motion to Amend. Dell’s argument regarding IGS’ Motion to Amend is based on the erroneous

assertion by Dell that the Trial Court ruled on the Motion. Appellees’ Brief p. 46.

In fact, the Court, acting at Dell’s urging, rushed to enter the Summary Judgment

Order before the hearing date on the Motion for Leave to Amend so it would not

have to address the Amendment on the merits.

29 The Appellees’ Brief cites several cases, each of which is distinguishable

from the motion for new trial in this case. See Appellees’ Brief pp. 46-47. First,

Dell cites Austin v. Countrywide Home Loans, 261 S.W.3d 68 (Tex. App.—

Houston [1st Dist.] 1995, pet. denied), in support of its argument. Austin is

inapposite. In that case, the plaintiff filed a motion to amend on the same day the

summary judgment order was entered. The plaintiff contended that the trial court

had stated on the record he could file the amended pleading at any time. 261

S.W.3d at 75. The court of appeals found no such permission had been granted

and, thus, the trial court did not abuse its discretion in not granting the motion to

amend since it was not filed with the Trial Court’s approval. Id. at 75.

Similarly, in Hussong v. Schwan’s Sales Enterprises, 896 S.W.2d 320, 322

(Tex. App—Houston [1st Dist.] 1995, no writ), the motion to amend was filed a

month after the hearing on summary judgment without the trial court’s permission.

The Court found that it was not an abuse of discretion for the trial court not to

consider amended pleadings filed after the summary judgment hearing without

permission of the trial court. Id. Finally, Hill v. Milani, 678 S.W.2d 203 (Tex.

App.—Austin 1984), aff’d, 686 S.W.2d 610 (Tex. 1985), involved denial of a

motion for rehearing, not a motion to amend. Cf. Appellees’ Brief pp. 46-47.

30 XIII. The Trial Court Should Have Granted IGS’ Motion for New Trial. IGS’ Motion for New Trial satisfies all of the requirements of Texas Rules

of Civil Procedure Rule 324(b)(1) and Waffle House v. Williams, 313 S.W.3d 796

(Tex. 2010), as fully set forth in IGS’ Brief. See Appellants’ Brief pp. 58-62.

Dell’s only argument—that IGS’ Motion for New Trial does not meet these

statutory requirements—is unsupported and unmeritorious. Appellees’ Brief pp.

51-59.

CONCLUSION For the foregoing reasons, and for the reasons stated in IGS’ Opening Brief,

IGS respectfully requests the Court reverse the Order for Summary Judgment and

remand this case to the Trial Court for trial.

Respectfully submitted,

GREENBERG TRAURIG, LLP Dale Wainwright By: /s/ Frank E. Merideth, Jr. State Bar No. 00000049 Frank E. Merideth, Jr. wainwrightd@gtlaw.com California State Bar No. 46266 Alan W. Hersh [Pro Hac Vice] State Bar No. 24080944 1840 Century Park East, Suite 1900 hersha@gtlaw.com Los Angeles, CA 90067-2101 300 West 6th Street, Suite 2050 Telephone: (310) 586-7879 Austin, Texas 78701 Facsimile: (310) 586-0275 Telephone: (512) 320-7200 meridethf@gtlaw.com Facsimile: (512) 320-7210

Counsel for Appellants INTEGRITY Global Security, LLC and Green Hills Software, Inc.

31 CERTIFICATE OF COMPLIANCE This brief complies with the length limitations of TEX. R. APP. P. 9.4(i)(3) because this brief consists of 7,497 words, excluding the parts of the brief exempted by TEX. R. APP. P. 9.4(i)(1).

/s/ Alan Hersh Alan Hersh

CERTIFICATE OF SERVICE I hereby certify that a true and correct copy of this letter was served on counsel of record by using the Court’s CM/ECF system on this 10th day of January, 2018, addressed as follows:

Beverly Reeves State Bar No. 16716500 breeves@reevesbrightwell.com Kim Brightwell State Bar No. 02992700 kbrightwell@reevesbrightwell.com Sinead O’Carroll State Bar No. 24013253 socarroll@reevesbrightwell.com REEVES & BRIGHTWELL LLP 221 West 6th Street, Suite 1000 Austin, Texas 78701 Phone: (512) 334-4500 Facsimile: (512) 334-4492;

Counsel for Appellees Dell Marketing L.P., Dell Federal Systems L.P., and Dell Products L.P.