Seth Bookout, Leslye Romero, and Ryan Gallagher v. Jonathan Shelley and Stedfast Baptist Church

Opinion

In the Court of Appeals Second Appellate District of Texas at Fort Worth ___________________________ No. 02-22-00055-CV ___________________________

SETH BOOKOUT, LESLYE ROMERO, AND RYAN GALLAGHER, Appellants

V.

JONATHAN SHELLEY AND STEDFAST BAPTIST CHURCH, Appellees

On Appeal from the 141st District Court Tarrant County, Texas Trial Court No. 141-329494-21

Before Sudderth, C.J.; Bassel and Walker, JJ. Memorandum Opinion by Justice Bassel MEMORANDUM OPINION

I. Introduction

In this accelerated interlocutory appeal, Appellants Seth Bookout, Leslye

Romero, and Ryan Gallagher challenge the trial court’s denial of their motion

invoking the Texas Citizens Participation Act (the TCPA or the Act) 1 by which they

sought to dismiss the lawsuit filed against them by Appellees Jonathan Shelley and

Stedfast Baptist Church.

This case involves an internecine battle for control of Stedfast. In September

2021, Appellants, claiming that they were Stedfast’s duly elected board of directors,

purported to terminate Shelley as pastor and seized control of Stedfast’s bank

accounts. In response, Appellees filed this lawsuit in which they seek a declaratory

judgment that, among other things, Appellants are not, in fact, directors of Stedfast

and have no authority to act on its behalf. Appellees also allege causes of action for

conversion and defamation.

Appellants moved to dismiss Appellees’ suit under the TCPA, asserting that

Appellees’ defamation claim violated Appellants’ exercise of the right of free speech

and that their causes of action for declaratory relief and conversion violated

Appellants’ right of association. Appellees responded to the motion by filing

affidavits and documentary evidence that they argued established a prima facie case

for each essential element of their claims against Appellants. The trial court denied

1 Tex. Civ. Prac. & Rem. Code Ann. §§ 27.001–.011.

2 Appellants’ TCPA motion and, finding that it was frivolous or filed solely for the

purpose of delay, awarded attorney’s fees to Appellees.

On appeal, in addition to challenging the trial court’s denial of their TCPA

motion and its award of attorney’s fees to Appellees, Appellants assert for the first

time that—based on the ecclesiastical abstention doctrine—the trial court lacks

subject matter jurisdiction over Appellees’ causes of action.

We conclude (1) that, though certain statements relied upon by Appellees may

not form the basis of a defamation claim pursuant to the ecclesiastical abstention

doctrine, the trial court has subject matter jurisdiction over all of Appellees’ causes of

action and (2) that the trial court’s ruling on Appellants’ TCPA motion was correct.

The first part of this opinion focuses on our conclusion that the ecclesiastical

abstention doctrine does not bar the adjudication of Appellees’ claims. In the second

part—employing the TCPA’s three-step process—we demonstrate that, though

Appellees’ claims are subject to the strictures of the TCPA, they should nevertheless

be allowed to proceed because they appear to have merit. Accordingly, we will affirm

the trial court’s order.

II. Background

A. Stedfast’s History and Disputed Leadership

In 2014, Benjamin Romero, the former husband of Appellant Leslye Romero,

formed Stedfast Baptist Church as a nonprofit corporation for religious, educational,

and charitable purposes. Mr. Romero served as the church’s original pastor and as a

3 member of the initial board of directors, which also included his then-wife Leslye and

Robert Starnes. In January 2019, Mr. Romero was compelled to resign as both pastor

and director of Stedfast due to inappropriate conduct.

After Mr. Romero resigned, Shelley was installed as the replacement pastor of

Stedfast in January 2019. Around this time, Stedfast’s existing board of directors

purportedly executed a document removing themselves as directors and appointing

Shelley, Ryan Urbanek, and Kevin Edelmann to replace them effective January 1,

2019. However—though she admits the document contains a signature resembling

her own—Mrs. Romero denies ever signing this document, and prior to September

2021, no public announcement or corporate filing was ever made to commemorate

this supposed change of leadership.

In September 2021, Mrs. Romero, apparently believing she was still a member

of the board, purported to call a special meeting of Stedfast’s board of directors via

Zoom videoconference.2 At this meeting, Mrs. Romero purported to appoint

Appellants Bookout and Gallagher as directors, and then Appellants collectively, as

the newly constituted board, proceeded to adopt new bylaws for Stedfast and appoint

2 The minutes from this purported board meeting reflect that Mrs. Romero was the only board member present at the initial roll call. Robert Starnes was listed as “not present.” Bookout, Gallagher, and Bo Ballard are listed as attendees.

4 themselves as officers.3 On the same day that the meeting took place, Appellants filed

a periodic report reflecting the purported changes in Stedfast’s corporate leadership

with the Texas Secretary of State.

Shortly thereafter, Appellants contacted Chase Bank to remove Shelley as the

signatory on Stedfast’s accounts and replace him with Bookout. Appellants then

engaged an attorney to send a termination letter to Shelley purporting to remove him

as Stedfast’s pastor. 4

After realizing that he no longer had access to Stedfast’s bank accounts,

discovering the periodic report filed by Appellants naming themselves as officers and

directors of Stedfast, and receiving the termination letter, Shelley engaged legal

counsel to represent Stedfast and himself. In early October 2021, Stedfast’s counsel

filed a Restated Certificate of Formation for the church naming Shelley, his wife Keri

Shelley, and Ryan Urbanek as directors. In addition, at a meeting held October 3,

2021, this alternate slate of directors adopted new bylaws for Stedfast.

B. Bookout’s Vitriolic Statements about Shelley and Stedfast

In June 2019—approximately two years before the previously described battle

for control of Stedfast began—Shelley confronted Bookout and admonished him for

The minutes of the meeting reflect that the directors appointed Bookout as 3

President, Mrs. Romero as Vice-President and Secretary, and Gallagher as Vice- President and Treasurer.

Appellants apparently used funds from Stedfast’s bank accounts at Chase Bank 4

to pay for the retention of this attorney. The attorney’s firm has since deposited all money it received from Stedfast’s accounts into the trial court’s registry.

5 “railing” and promoting false doctrines such as “Flat Earth Theory.” When Bookout

refused to repent, Shelley removed him as a member of Stedfast.

After his removal, Bookout began to harshly and publicly criticize both Shelley

and Stedfast. Specifically, Shelley claims that in videos posted to social media

platforms such as YouTube, Bookout accused him of, among other things, physically

abusing his children, embezzling funds from Stedfast to pay for the remodeling of his

home, and being a “sodomite.” In addition, Shelley claims that Bookout described

Stedfast as a cult and accused Shelley of being a cult leader.

C. Legal Proceedings

In October 2021, Shelley and Stedfast filed suit against Appellants seeking

injunctive relief; damages for conversion and defamation; and a declaratory judgment

that, among other things, Shelley, Keri Shelley, and Ryan Urbanek (sometimes

collectively referred to herein as the Shelley Group)—not Appellants—are the duly

elected and appointed members of Stedfast’s board of directors. Appellants filed a

motion to dismiss pursuant to the TCPA. The trial court denied the motion to

dismiss and, finding that the motion was frivolous or filed for the sole purpose of

delay, ordered Appellants to pay Stedfast’s attorney’s fees and expenses incurred in

responding to the motion. This interlocutory appeal followed.5

5 The Texas Civil Practice and Remedies Code provides for an interlocutory appeal of an order that “denies a motion to dismiss filed under” the TCPA. Id. § 51.014(a)(12).

6 III. Analysis

On appeal, Appellants raise seven issues:

(1) Whether the trial court has subject matter jurisdiction to decide the issues raised in Appellees’ causes of action under the ecclesiastical abstention doctrine; (2) Whether the trial court erred in ruling that Appellees’ causes of action were not based on Appellants’ exercise of the freedom of speech, association, or petition;6 (3) Whether the trial court erred when it denied Appellants’ motion to dismiss Appellees’ defamation cause of action against Appellants Romero and Gallagher; (4) Whether the trial court erred when it denied Appellants’ motion to dismiss Appellees’ defamation cause of action against Appellant Bookout; (5) Whether the trial court erred when it denied the motion to dismiss Appellees’ conversion cause of action; (6) Whether the trial court erred when it denied the motion to dismiss Appellees’ declaratory judgment cause of action; and (7) Whether the trial court erred in awarding attorney’s fees and costs to Appellees based upon its finding that Appellants’ motion to dismiss was frivolous or filed solely for the purposes of delay.

6 It is unclear whether the trial court did, in fact, make this determination. The trial court’s order contains no express ruling regarding whether Appellees’ causes of action are based on Appellants’ exercise of the freedom of speech, association, or petition, and the trial court did not issue specific findings of fact or conclusions of law. As we will further discuss below, Appellees concede that their defamation cause of action is based on Appellants’ exercise of the freedom of speech; however, they dispute whether their declaratory judgment and conversion causes of action are sufficiently linked to Appellants’ right of association to be brought under the auspices of the TCPA. In any event, as we must necessarily determine whether the TCPA applies to each of Appellees’ claims in order to resolve Appellants’ fourth, fifth, and sixth issues, we do not address this issue separately.

7 We will address each of these issues below. A. Subject Matter Jurisdiction: Application of the Ecclesiastical Abstention Doctrine In their first issue, Appellants assert that the trial court does not have subject

matter jurisdiction over Appellees’ causes of action under the ecclesiastical abstention

doctrine.7 Because a determination that the trial court lacks subject matter jurisdiction

would be dispositive of this appeal, we will address this issue first. See Blum v. Restland

of Dall., Inc., 971 S.W.2d 546, 549 (Tex. App.—Dallas 1997, pet. denied).

1. Subject Matter Jurisdiction and Standard of Review

“‘Subject matter jurisdiction cannot be waived or conferred by agreement’ and

‘can be raised at any time,’ including in an interlocutory appeal.” Anderson v. Truelove,

446 S.W.3d 87, 91 (Tex. App.—Houston [1st Dist.] 2014, no pet.) (quoting Rusk State

Hosp. v. Black, 392 S.W.3d 88, 103 (Tex. 2012) (Lehrmann, J., concurring in part and

dissenting in part)). We review the existence of subject matter jurisdiction de novo. 8

State v. Holland, 221 S.W.3d 639, 642 (Tex. 2007); Tex. Dep’t of Parks & Wildlife v.

Miranda, 133 S.W.3d 217, 226 (Tex. 2004). The pleader must allege facts that

affirmatively demonstrate the trial court’s jurisdiction to hear the cause. Dall. Cnty.

Appraisal Dist. v. Funds Recovery, Inc., 887 S.W.2d 465, 469 (Tex. App.—Dallas 1994,

7 As noted above, Appellants did not raise this issue in the trial court and assert it for the first time on appeal. 8 Because, as noted above, Appellants raised this issue for the first time on appeal, it was not addressed in the trial court.

8 writ denied) (citing Tex. Ass’n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440, 446 (Tex.

1993)). When reviewing subject matter jurisdiction, we must construe the petition in

favor of the pleader and, if necessary, review the entire record to determine if any

evidence supports jurisdiction. Id. (citing Tex. Ass’n of Bus., 852 S.W.2d at 446); see

Wise Reg’l Health Sys. v. Brittain, 268 S.W.3d 799, 804 (Tex. App.—Fort Worth 2008,

no pet.).

2. The Ecclesiastical Abstention Doctrine

The ecclesiastical abstention doctrine prohibits civil courts from delving into

matters of theological controversy, church discipline, ecclesiastical government, or

members’ conformity to the church’s moral standards. Serbian E. Orthodox Diocese v.

Milivojevich, 426 U.S. 696, 713–14, 96 S. Ct. 2372, 2382 (1976) (quoting Watson v. Jones,

80 U.S. 733, 733–34 (1871)). The doctrine is grounded in the First Amendment,

which protects the right of religious institutions to decide for themselves, free from

state interference, matters of church governance as well as those of faith and doctrine.

Id. at 721–22, 96 S. Ct. at 2386; In re Diocese of Lubbock, 624 S.W.3d 506, 508–09 (Tex.

2021) (orig. proceeding).

“Determining the reach of subject matter jurisdiction in disputes involving

religious organizations requires consideration of competing demands.” Thiagarajan v.

Tadepalli, 430 S.W.3d 589, 594 (Tex. App.—Houston [14th Dist.] 2014, pet. denied).

“Courts do not have jurisdiction to decide questions of an ecclesiastical or inherently

religious nature, so as to those questions they must defer to decisions of appropriate

9 ecclesiastical decision makers.” Masterson v. Diocese of Nw. Tex., 422 S.W.3d 594, 605–

06 (Tex. 2013). “But Texas courts are bound to exercise jurisdiction vested in them

by the Texas Constitution and cannot delegate their judicial prerogative where

jurisdiction exists.” Id. at 606. “In short, courts must act but cannot intrude.”

Thiagarajan, 430 S.W.3d at 595; see also Masterson, 422 S.W.3d at 596 (recognizing that

Texas courts have a “constitutional duty to decide disputes within their jurisdiction

while still respecting limitations the First Amendment places on that jurisdiction”).

“Properly exercising jurisdiction requires courts to apply neutral principles of

law to non-ecclesiastical issues involving religious entities in the same manner as they

apply those principles to other entities and issues.” Masterson, 422 S.W.3d at 606.

“Thus, courts are to apply neutral principles of law to issues such as land titles, trusts,

and corporate formation, governance, and dissolution, even when religious entities are

involved.” Id. “[T]he line between required judicial action and forbidden judicial

intrusion ‘will not always be distinct’ because many disputes ‘require courts to analyze

church documents and organizational structures to some degree.’” Thiagarajan, 430

S.W.3d at 595 (quoting Masterson, 422 S.W.3d at 606). “[C]ourts must look to the

substance and effect of a plaintiff’s complaint to determine its ecclesiastical

implication, not its emblemata.” Tran v. Fiorenza, 934 S.W.2d 740, 743 (Tex. App.—

Houston [1st Dist.] 1996, no writ) (citing Green v. United Pentecostal Church Int’l, 899

S.W.2d 28, 30 (Tex. App.—Austin 1995, writ denied)); see also Williams v. Gleason, 26

S.W.3d 54, 59 (Tex. App.—Houston [14th Dist.] 2000, pet. denied) (“Whether this

10 suit is ecclesiastical, or concerns property rights, torts, or criminal conduct, is

determined by first examining the substance and effect of the [plaintiffs’] petition—

without considering what they use as claims—to determine its ecclesiastical

implication.”).

3. Application to the Present Case

To determine whether and to what extent the ecclesiastical abstention doctrine

applies to the present case, we must examine the “substance and effect” of Appellees’

petition to evaluate its ecclesiastical implication. See Tran, 934 S.W.2d at 743. In their

amended original petition, Appellees assert causes of action for defamation,

declaratory relief, and conversion. We will consider the applicability of the

ecclesiastical abstention doctrine to each of these causes of action in turn.

a. Defamation

To prevail on a cause of action for defamation, “[a] plaintiff must prove that

the defendant: (1) published a statement; (2) that was defamatory concerning the

plaintiff; (3) while acting with either actual malice, if the plaintiff was a public official

or public figure, or negligence, if the plaintiff was a private individual, regarding the

truth of the statement.” WFAA–TV, Inc. v. McLemore, 978 S.W.2d 568, 571 (Tex.

1998). In addition, unless the statement in question constitutes defamation per se, the

plaintiff must prove damages. See Waste Mgmt. of Tex., Inc. v. Tex. Disposal Sys. Landfill,

Inc., 434 S.W.3d 142, 146 n.7 (Tex. 2014). “A statement is defamatory if it tends to

harm the reputation of another so as to lower him in the estimation of the community

11 or to deter third persons from associating or dealing with him, or if it tends to expose

him to public hatred, contempt, or ridicule.” Hanssen v. Our Redeemer Lutheran Church,

938 S.W.2d 85, 92 (Tex. App.—Dallas 1996, writ denied) (citing Hardwick v. Hous.

Lighting & Power Co., 881 S.W.2d 195, 197 (Tex. App.—Corpus Christi–Edinburg

1994, writ dism’d w.o.j.)).

Appellees’ defamation claims are primarily based upon certain statements

allegedly made by Bookout in videos posted to social media in which he, among other

things, called Shelley a “sodomite” and accused him of physically abusing his children

and embezzling money from Stedfast to pay for a home remodel. Bookout also

allegedly referred to Shelley as a “cult leader” and claimed Stedfast was a “cult.” In

addition, Appellees’ petition asserts—without specifics—that the termination letter

Appellants’ counsel sent to Shelley contained “several false and defamatory statements

about the character of Pastor Shelley.” We will consider each of these statements in

turn to determine whether the ecclesiastical abstention doctrine deprives the trial

court of jurisdiction to hear claims predicated on the statements.

First, Bookout’s alleged accusations that Shelley had physically abused his

children and embezzled money from Stedfast clearly have no ecclesiastical

implications. The truth or falsity of these allegations does not depend on any church

doctrine or turn on anyone’s religious beliefs. Moreover, the defamatory nature of

these allegations is not inextricably intertwined with ecclesiastical matters because,

while such behavior would run counter to the teachings of most churches or religious

12 institutions, it is also against the law and can be viewed as defamatory from a purely

secular standpoint. Indeed, if—as Appellees assert—these statements unambiguously

and falsely impute criminal conduct to Shelley, they would constitute defamation

per se, meaning damages would be presumed. See Gray v. HEB Food Store No. 4, 941

S.W.2d 327, 329 (Tex. App.—Corpus Christ–Edinburg 1997, writ denied). Thus,

these allegations are not unlike those routinely considered by courts in adjudicating

defamation claims involving secular parties. Therefore, we conclude that these

statements are actionable—no matter the ecclesiastical abstention doctrine.

Bookout’s statements that Shelley was a “cult leader” and that Stedfast was a

“cult” fall on the other end of the spectrum. As one of our sister courts has

recognized, “being labeled a ‘cult’ is not actionable because the truth or falsity of the

statement depends upon one’s religious beliefs, an ecclesiastical matter which cannot

and should not be tried in a court of law.” Harvest House Publishers v. Local Church, 190

S.W.3d 204, 212 (Tex. App.—Houston [1st Dist.] 2006, pet. denied) (citing Sands v.

Living Word Fellowship, 34 P.3d 955, 960 (Alaska 2001)). Thus, the ecclesiastical

abstention doctrine bars any defamation claim arising from these statements.

Next, we must consider Bookout’s statement that Shelley is a “sodomite.” The

applicability of the ecclesiastical abstention doctrine to this statement is not as clear-

cut. “Sodomite” is not a strictly religious label and can be defined in purely secular

13 terms.9 However, an examination of Shelley’s reasons for asserting that this and other

similar statements by Bookout are offensive reveals that the claim is religious in

nature.10 Shelley asserts that these statements constitute defamation per se because

they bear on his “fitness and qualifications to serve as a [p]astor not only at Stedfast

Baptist Church, but anywhere.” Thus, the adjudication of this claim would require

the court to examine church doctrines, the qualifications to serve as a pastor not only

at Stedfast but in other churches, and Shelley’s conformity to standards of morality, all

of which are prohibited under the ecclesiastical abstention doctrine. See Becker v.

Clardy, No. 03-10-00376-CV, 2011 WL 6756999, at *4 (Tex. App.—Austin Dec. 22,

2011, pet. denied) (mem. op.) (holding the ecclesiastical abstention doctrine applied to

a defamation claim where the determination as to “[w]hether or not to ‘impose civil

tort liability’ against [the defendant] . . . would require an analysis of internal church

matters and doctrine”); Dean v. Alford, 994 S.W.2d 392, 395 (Tex. App.—Fort Worth

1999, no pet.) (recognizing that “[i]t is without dispute that the First Amendment

9 Indeed, Black’s Law Dictionary contains a definition of the term “sodomy,” of which “sodomite” is a derivation. Sodomy, Black’s Law Dictionary (11th ed. 2019). 10 Shelley alleges that, in addition to calling him a “sodomite,” Bookout posted a video of a coffee mug with Shelley’s image and a rainbow flag engraved on it, which Bookout stated was part of “the Official Pastor Jonathan Shelley Merchandise” that Shelley had made himself. According to Shelley, Bookout also claimed that Shelley wore nail polish and had worn lipstick in his high school yearbook photo. Shelley asserts that these statements are defamatory because “they suggest that [he] engage[s] in sexual activities that are condemned by the doctrines of [his] [c]hurch.” Accordingly, our ruling regarding the actionability of Bookout’s statement that Shelley was a “sodomite” applies with equal force to these statements.

14 prohibits civil courts from intruding into the church’s governance of ‘religious’ or

‘ecclesiastical’ matters, such as . . . the conformity of members to standards of

morality”); cf. HEB Ministries, Inc. v. Tex. Higher Educ. Coordinating Bd., 235 S.W.3d 627,

642–43 (Tex. 2007) (“Since the government cannot determine what a church should

be, it cannot determine the qualifications a cleric should have or whether a particular

person has them.” (footnote omitted)); In re First Christian Methodist Evangelistic Church,

No. 05-18-01533-CV, 2019 WL 4126604, at *5 (Tex. App.—Dallas Aug. 30, 2019,

orig. proceeding) (mem. op.) (granting mandamus relief in suit based on dismissal of

senior pastor because ecclesiastical abstention doctrine prohibited court from

examining church’s teachings and rules or reasons for termination). Accordingly, the

ecclesiastical abstention doctrine bars any claim for defamation based on Bookout’s

statement that Shelley is a “sodomite.”

Finally, we consider the allegedly defamatory statements contained in the

termination letter sent to Shelley.11 While Appellees’ petition does not identify any

11 It is unclear whether Appellees, in fact, assert a defamation claim based upon the statements contained in the termination letter, and it is also unclear whether such statements were “published.” See WFAA–TV, 978 S.W.2d at 571 (listing publication among the elements of a defamation claim). Appellees’ amended petition states that the correspondence “contains several false and defamatory statements about the character of Pastor Shelley” and that a copy of the correspondence is attached thereto “for the purpose of demonstrating the nature of the defamatory conduct that has been committed by Defendants.” However, in their briefing before this court, Appellees assert that their defamation cause of action was directed solely against Bookout and, thus, presumably based only on his previously addressed statements. Given the uncertainty, we address the actionability of the statements contained in the termination letter in the interests of completeness and caution. See Carr v. Jaffe Aircraft

15 specific statements in the letter as defamatory, our examination of the letter, which

mostly contains directives commanding Shelley to turn over various property and to

refrain from engaging in certain activities on behalf of Stedfast, revealed only one

sentence explaining the reason for Shelley’s termination: “This termination was

determined to be for cause due to many irregularities in the accounting, management

and handling of donations to the church.” Arguably, this statement implies that

Shelley mismanaged church funds. To the extent Appellees assert a claim for

defamation based upon this statement, such a claim is not barred by the ecclesiastical

abstention doctrine. Rather, because the truth or falsity of this statement can be

determined by reviewing the church’s books and records and applying neutral

principles of law, it is actionable. Cf. Lacy v. Bassett, 132 S.W.3d 119, 125–26 (Tex.

App.—Houston [14th Dist.] 2004, no pet.) (holding inspection of church books and

records under former Texas Revised Civil Statute Article 1396–2.23 did not implicate

ecclesiastical abstention doctrine).

b. Declaratory Relief

Chapter 37 of the Texas Civil Practice & Remedies Code provides that

[a] person interested under a deed, will, written contract, or other writings constituting a contract or whose rights, status, or other legal relations are affected by a statute, municipal ordinance, contract, or franchise may have determined any question of construction or validity arising under the instrument, statute, ordinance, contract, or franchise

Corp., 884 S.W.2d 797, 803 (Tex. App.—San Antonio 1994, no writ); Jones v. State, No. C14-92-01182-CR, 1993 WL 153660, at *3 (Tex. App.—Houston [14th Dist.] May 13, 1993, pet. ref’d) (not designated for publication).

16 and obtain a declaration of rights, status, or other legal relations thereunder.

Tex. Civ. Prac. & Rem. Code Ann. § 37.004(a). “Chapter 37’s stated purpose is ‘to

settle and to afford relief from uncertainty and insecurity with respect to rights, status,

and other legal relations.’” Allstate Ins. Co. v. Irwin, 627 S.W.3d 263, 271 (Tex. 2021)

(quoting Tex. Civ. Prac. & Rem. Code Ann. § 37.002(b)).

In their amended petition, Appellees seek a declaratory judgment that:

(a) Stedfast Baptist Church is a Texas nonprofit corporation engaged in

performing religious training, education, and exhortation activities and is

governed by a board of directors of which, pursuant to the bylaws of the

corporation, the pastor of the congregation is a member;

(b) Stedfast Baptist Church is an independent, congregational, non-

hierarchical religious organization whose members are communicants in

good standing and is governed by a board of directors elected and

appointed pursuant to the bylaws of the corporation;

(c) Jonathan Shelley is the duly appointed and ordained pastor of Stedfast;

(d) The members of the Shelley Group are the duly elected and appointed

members of the board of directors of Stedfast;

(e) Appellants are not the duly elected and appointed members of the board

of directors of Stedfast, and none of them has any authority whatever to

act on behalf of or bind Stedfast;

17 (f) The documents filed by Appellants are false and fraudulent, and

Appellants filed such documents with the Secretary of State knowingly,

intentionally, and fraudulently; and

(g) As the duly elected and designated members of the board of directors of

Stedfast, the Shelley Group, or its designated representative, is entitled to

access to all bank accounts at Chase Bank held in Stedfast’s name.

Thus, at the heart of Appellees’ request for declaratory relief is whether the Shelley

Group or Appellants are the duly elected and appointed members of Stedfast’s board

of directors.

Applying the ecclesiastical abstention doctrine to Appellees’ request for

declaratory relief highlights the indistinct nature of “the line between required judicial

action and forbidden judicial intrusion.” Thiagarajan, 430 S.W.3d at 595. On one

hand, adjudication of this cause of action will require the examination of church

documents and organizational structures, and given the nature of the declaratory relief

sought, the outcome of this cause of action will, in essence, decide who has authority

to manage and act on behalf of Stedfast. This, at first blush, might lead one to

conclude that it would be barred as an improper intrusion into matters of

ecclesiastical government. See, e.g., In re Diocese of Lubbock, 624 S.W.3d at 508–09.

However, because the resolution of this cause of action does not turn on matters of

an ecclesiastical or inherently religious nature but, rather, hinges on the interpretation

and verification of corporate documents—including Stedfast’s bylaws and board

18 minutes—and the Texas Business Organizations Code, the trial court may properly

exercise jurisdiction. See Ceglar v. Christ’s Harbor Church, No. 13-19-00034-CV, 2020

WL 948380, at *2 (Tex. App.—Corpus Christi–Edinburg, Feb. 27, 2020, pet. denied)

(mem. op.) (“Under [a neutral principles of law] approach, a court may interpret

church documents in purely secular terms without relying on religious precepts in

resolving the conflict.”); Lacy, 132 S.W.3d at 123 (same).

An examination of the specific declaratory relief sought by Appellees reveals

that this cause of action is, at its core, a dispute over corporate governance, not

religious or doctrinal matters. See Iglesia Pentecostal Filadelfia, Inc. v. Rodriguez, No. 13-20-

00012-CV, 2021 WL 6129316, at *4 (Tex. App.—Corpus Christi–Edinburg Dec. 29,

2021, no pet.) (mem. op.) (“A court may exercise jurisdiction over a [controversy] if it

can apply neutral principles of law that will not require inquiry into matters such as

religious doctrine.” (first citing Westbrook v. Penley, 231 S.W.3d 389, 398–400 (Tex.

2007); then citing Dean, 994 S.W.2d at 395; and then citing Ceglar, 2020 WL 948380, at

*2)).

The relief sought in items (a) and (b) on the list of Appellees’ requested

declaratory relief pertains to Stedfast’s basic organizational structure and purpose,

which can be readily determined by reviewing its articles of incorporation and bylaws.

The adjudication of the remaining items, (c) through (g), depends—at least

primarily—upon the determination of whether the Shelley Group or Appellants are

the rightful directors of Stedfast. Appellees have presented evidence in the form of

19 corporate records, including board minutes, and affidavits to support their claim that

the Shelley Group is the rightful board of directors. Appellants have challenged this

evidence, specifically with respect to whether Leslye Romero signed the minutes from

the January 2019 board meeting reflecting that she and the other then-current board

members had been removed and replaced by Shelley, Edelmann, and Urbanek. Thus,

the resolution of this central issue will involve examining and verifying corporate

records and organizational documents and evaluating the credibility of witness

testimony regarding corporate actions, all of which can be done on a purely secular

basis by applying neutral principles of law. Cf. Masterson, 422 S.W.3d at 608 (holding

dispute could be resolved by application of neutral principles of law where bylaws

expressly governed the question presented). Crucially, its adjudication will not require

the court to examine or resolve any questions touching upon matters of faith,

doctrine, or church discipline.

Among the cases Appellants cite in support of their contention that the trial

court lacks jurisdiction is our prior opinion in Dean. 994 S.W.2d at 394–95. However,

Dean is distinguishable from the present case. 12 In Dean, a church had conducted two

12 Moreover, we recognize, as one of our sister courts in Houston has pointed out, that Dean was decided 15 years before Masterson, in which the Texas Supreme Court “reaffirmed that courts should defer to ‘religious entities’ decisions on ecclesiastical and church polity questions,’ but held that ‘courts are to apply neutral principles of law to issues such as land titles, trusts, and corporate formation, governance, and dissolution, even when religious entities are involved.’” Anderson, 446 S.W.3d at 93 (citing Masterson, 422 S.W.3d at 596, 606). Now, after Masterson, it is unclear whether courts may consider the propriety of a minister’s termination—an

20 congregational elections to decide whether to retain their pastor. Id. at 394. In the

first election, the church voted to retain the pastor, but because the election had been

marred by physical altercations, some congregants considered the vote tainted and

filed suit for injunctive relief. Id. A second election was held in which the church

members voted 87 to 1 to remove the pastor, and the plaintiffs amended their petition

to seek declaratory relief regarding his removal. Id. Recognizing that “[t]he

relationships between an organized church and its ministers [are] its lifeblood,” we

held that “the issue of a pastor’s ouster is ecclesiastical in nature” and that, therefore,

abstention was required. Id. at 395.

The present case is distinguishable because while Dean was principally

concerned with the termination of a pastor, the issue of Shelley’s termination is not

directly at issue. Indeed, Appellees’ petition contains no allegation that Shelley was

discharged, much less wrongfully discharged. While Appellees seek a declaratory

judgment that “Shelley is the duly appointed and ordained [p]astor of Stedfast,” this

determination turns on the antecedent issue of whether Appellants or the Shelley

Group is Stedfast’s true board of directors. If, as Appellees claim, Appellants are not

the duly elected members of Stedfast’s board, then the termination letter that they

caused to be sent to Shelley would be of no force or effect, and since Shelley’s original

issue previously believed to be unreviewable—“in cases in which the question turns on the substance of a document to which neutral principles of law may be applied, such as an incorporated church’s bylaws.” Id. In any event, because Shelley’s termination is not directly at issue in this case, we need not decide this question here.

21 appointment as Stedfast’s pastor in 2019 is not in dispute, he would therefore

continue to be “the duly appointed and ordained [p]astor of Stedfast.” Thus, unlike in

Dean, the trial court will not be required to involve itself in the inherently ecclesiastical

process of determining whether the church members desire to sever their relationship

with their pastor; rather, the court will only be required to resolve the antecedent issue

of corporate governance, which, as noted above, can be accomplished by applying

neutral principles of law to review and verify Stedfast’s organizational documents and

corporate records, including board minutes. Cf. Masterson, 422 S.W.3d at 608.

The Anderson case, which Appellants also cite in support of their argument for

ecclesiastical abstention, is likewise distinguishable. 446 S.W.3d at 91. As Appellants

point out in their briefing, Anderson’s facts are, in many respects, “eerily reminiscent”

of the present case: both involve the attempted ouster of a pastor of a non-

hierarchical church incorporated as a nonprofit under the laws of Texas by a board of

directors with disputed membership. Id. at 89–90. However, there are two significant

differences. First, unlike the present case, in Anderson, the pastor’s termination was

directly at issue as the pastor sought declaratory relief that his termination was void—

relief not sought by Appellees here. Id. Second, and more importantly, the pastor in

Anderson had argued and presented evidence showing that the church’s bylaws did not

permit the board of directors to terminate him. Id. at 90. As one witness testified,

“whether [the pastor] stays or goes is something for the church members to decide.”

Id. This lack of board authority was central to the Anderson court’s ruling, as it held

22 that because the bylaws contained no provision regarding the termination of a

minister, the court could not “merely construe the bylaws under neutral principles of

law to resolve the parties’ dispute.” Id. at 94. Here, no such challenge to the board’s

authority has been raised. While Appellees seek declaratory relief that Appellants are

not duly elected members of Stedfast’s board, they do not question whether a

properly elected board would have the authority to terminate Shelley.13 Thus, unlike

Anderson, the controlling issue is not the board’s authority to terminate a pastor but,

rather, which slate of board members—Appellants or the Shelley Group—is the

rightful one. As this issue can be decided by applying neutral principles of law to

13 Appellants point out in their briefing that, while Appellees have produced the bylaws that were prepared and filed by their counsel on October 4, 2021, they have not yet produced the bylaws that were in effect during the period of January 2019 to September 2021. In an attempt to align the issues presented in the present case with those presented in Anderson, Appellants assert that because the bylaws presented by Appellees are similarly silent regarding the board’s authority to terminate a pastor and the prior bylaws are not part of the appellate record, the court “has no method of applying neutral principles of . . . law to the firing of Jonathan Shelley.” However, as noted above, the board’s termination of Shelley is not directly at issue in this case, nor have Appellees challenged the authority of a duly elected board to terminate a pastor. Even if the propriety of Shelley’s termination were directly at issue, given that Appellants clearly believed that they had authority to terminate Shelley at the time the termination letter was sent, it would—at a minimum—be awkward for them to now take the position that they did not have the authority to terminate him. Indeed, as Appellants have asserted a counterclaim against Shelley for fraud based on their assertion that he “is fraudulently holding himself out as the pastor of the church when he has been terminated,” it would appear that they have already judicially admitted that the board has the authority to terminate a pastor. See TX Far W., Ltd. v. Tex. Invs. Mgmt., Inc., 127 S.W.3d 295, 307 (Tex. App.—Austin 2004, no pet.) (“It is well established that ‘assertions of fact . . . in the live pleadings of a party are regarded as formal judicial admissions.’” (quoting Holy Cross Church of God in Christ v. Wolf, 44 S.W.3d 562, 568 (Tex. 2001))).

23 construe and verify Stedfast’s organizational documents and corporate records, the

trial court may properly exercise jurisdiction.

In sum, because the court can adjudicate Appellees’ request for declaratory

relief by applying neutral principles of law to review and verify Stedfast’s

organizational documents and corporate records, including board minutes, the trial

court may properly exercise jurisdiction over this cause of action. See Masterson, 422

S.W.3d at 606; cf. Lee v. Paik, No. 05-17-01406-CV, 2019 WL 1033869, at *1–3 (Tex.

App.—Dallas Mar. 5, 2019, no pet.) (mem. op.) (affirming declaratory judgment

regarding, inter alia, the composition of the board of trustees of a church incorporated

as a nonprofit corporation under the Texas Business Organizations Code and the

termination of the church’s pastor that contained the trial court’s specific finding that

“the Court need not (and did not) refer to any ecclesiastical law or theological

doctrine in making its determination in this case”).

c. Conversion

Conversion is “the wrongful exercise of dominion and control over another’s

property in denial of or inconsistent with his rights.” Green Int’l, Inc. v. Solis, 951

S.W.2d 384, 391 (Tex. 1997). “To establish conversion of personal property, a

plaintiff must prove that: (1) the plaintiff owned or had legal possession of the

property or entitlement to possession; (2) the defendant unlawfully and without

authorization assumed and exercised dominion and control over the property to the

exclusion of, or inconsistent with, the plaintiff’s rights as an owner; and (3) the

24 plaintiff suffered injury.” Lopez v. Lopez, 271 S.W.3d 780, 784 (Tex. App.—Waco

2008, no pet.) (op. on reh’g) (first citing United Mobile Networks, L.P. v. Deaton, 939

S.W.2d 146, 147–48 (Tex. 1997); and then citing Apple Imports, Inc. v. Koole, 945 S.W.2d

895, 899 (Tex. App.—Austin 1997, pet. denied) (op. on reh’g)).

Appellees’ conversion claim is based on Appellants’ actions to assume control

of Stedfast’s bank accounts, which contained approximately $125,000 in deposits, and

to pay $40,000 of those funds to Appellants’ counsel. Thus, Appellees’ conversion

claim—like most of their requests for declaratory relief—turns on the issue of which

slate of board members—Appellants or the Shelley Group—is the rightful one. For

if Appellants are the duly elected members of Stedfast’s board, then their exercise of

dominion and control over Stedfast’s bank accounts would be neither unlawful nor

unauthorized. Since Appellees’ conversion and declaratory judgment causes of action

revolve around the same central issue, our ecclesiastical abstention analysis is the

same: because the court can resolve the dispute regarding the membership of

Stedfast’s board by applying neutral principles of law to review and verify Stedfast’s

organizational documents and corporate records, including board minutes, the trial

court may properly exercise jurisdiction. See Masterson, 422 S.W.3d at 606. Indeed, a

conversion claim is, at its core, a property dispute, which the Texas Supreme Court

has expressly declared to be a matter courts can decide using the neutral-principles

methodology. See In re Diocese of Lubbock, 624 S.W.3d at 513 (“Under the neutral-

principles methodology, ‘courts decide non-ecclesiastical issues such as property

25 ownership based on the same neutral principles of law applicable to other

entities . . . .’” (quoting Masterson, 422 S.W.3d at 596)).

d. Summary

Having applied the ecclesiastical abstention doctrine to Appellees’ causes of

action, we sustain in part and overrule in part Appellants’ first issue. We conclude

that under the ecclesiastical abstention doctrine the trial court lacks subject matter

jurisdiction over Appellees’ defamation claim to the extent that it is based on

Bookout’s alleged statements that Stedfast is a “cult” and that Shelley is a “cult

leader.” Similarly, Bookout’s alleged statements referring to Shelley as a “sodomite”

or “suggest[ing] that [Shelley] engage[s] in sexual activities that are condemned by the

doctrines of [his] [c]hurch” are not actionable. However, the trial court may properly

exercise jurisdiction over the remainder of Appellees’ defamation claim as well as their

causes of action for declaratory relief and conversion.

B. The Texas Citizens Participation Act (TCPA)

Having determined that, though the ecclesiastical abstention doctrine prohibits

Appellees from relying on certain statements to support their defamation claim, the

trial court may nevertheless properly exercise subject matter jurisdiction over all of

Appellees’ causes of action, we must now consider whether any of these claims must

be dismissed under the TCPA.

26 1. Standard of Review

We review de novo a trial court’s denial of a TCPA motion to dismiss. Robert

B. James, DDS, Inc. v. Elkins, 553 S.W.3d 596, 603 (Tex. App.—San Antonio 2018, pet.

denied). In reviewing a ruling on a TCPA motion, “[w]e view the pleadings and

evidence in the light most favorable to the nonmovant.” Id.

We also review questions of statutory construction de novo. See ExxonMobil

Pipeline Co. v. Coleman, 512 S.W.3d 895, 899 (Tex. 2017); see also Adams v. Starside Custom

Builders, LLC, 547 S.W.3d 890, 897 (Tex. 2018) (“In TCPA appeals, we have decided

whether communications are matters of public concern under a de novo standard of

review, suggesting that the determination is one of law.”). Our objective is to

“ascertain and give effect to the Legislature’s intent as expressed by the language of

the statute.” State ex rel. Best v. Harper, 562 S.W.3d 1, 11 (Tex. 2018) (quoting City of

Rockwall v. Hughes, 246 S.W.3d 621, 625 (Tex. 2008)). When a statute does not define

a key term, we give that term its “common, ordinary meaning unless a contrary

meaning is apparent from the statute’s language.” Tex. State Bd. of Exam’rs of Marriage

& Fam. Therapists v. Tex. Med. Ass’n, 511 S.W.3d 28, 34 (Tex. 2017). To determine a

word’s common, ordinary meaning, we look first to its dictionary definitions. Id. at

35. “[I]f an undefined term has multiple common meanings . . . we will apply the

definition most consistent with the context of the statutory scheme.” Thompson v. Tex.

Dep’t of Licensing & Regul., 455 S.W.3d 569, 571 (Tex. 2014).

27 In addition to these general rules of statutory construction, we must adhere to

the express directions for construction contained within the TCPA itself. See State

ex rel. Best, 562 S.W.3d at 11. Thus, we construe the TCPA “liberally to effectuate its

purpose and intent fully.” Tex. Civ. Prac. & Rem. Code Ann. § 27.011(b).

2. The Background and Structure of the TCPA

The TCPA is popularly known as the Texas Anti-SLAPP statute, referring to

Strategic Lawsuits Against Public Participation. Its stated purpose “is to encourage

and safeguard the constitutional rights of persons to petition, speak freely, associate

freely, and otherwise participate in government to the maximum extent permitted by

law and, at the same time, protect the rights of a person to file meritorious lawsuits

for demonstrable injury.” Id. § 27.002. To effectuate this purpose, the TCPA

provides “an expedited procedure for the early dismissal of groundless legal actions

that impinge on First Amendment rights.” Greer v. Abraham, 489 S.W.3d 440, 442

(Tex. 2016).

This court has previously described the three-part burden-shifting analysis that

must be undertaken once a motion to dismiss is filed under the TCPA:

The three steps are as follows: (1) the party invoking the TCPA must demonstrate that a “legal action” has been brought against it that is “based on or is in response to” an exercise of the rights of free speech, petition, or association protected by the Act; (2) if the moving party successfully invokes the Act, “[t]he court may not dismiss a legal action under this section if the party bringing the legal action establishes by clear and specific evidence a prima facie case for each essential element of the claim in question[;]” and (3) if the nonmoving party carries its burden, the case may still be dismissed “if the moving party establishes

28 an affirmative defense or other grounds on which the moving party is entitled to judgment as a matter of law.” [Tex. Civ. Prac. & Rem. Code Ann.] § 27.005(b)–(d). Miller v. Watkins, No. 02-20-00165-CV, 2021 WL 924843, at *7 (Tex. App.—Fort

Worth Mar. 11, 2021, no pet.) (mem. op.).

3. Application to the Present Case

Appellants moved to dismiss all of Appellees’ claims under the TCPA, asserting

that Appellees’ defamation cause of action is based on Appellants’ right of free speech

and that Appellees’ declaratory judgment and conversion causes of action are based

on Appellants’ right of association. While Appellees concede that their defamation

claim falls within the scope of the TCPA, they contend that the Act does not apply to

their causes of action for declaratory judgment and conversion. Thus, though we will

need to determine whether Appellants have satisfied their burden to show that

Appellees’ declaratory judgment and conversion claims are “based on or in response

to” Appellants’ rights of association, we can dispense with this first step of the TCPA

burden-shifting analysis with respect to Appellees’ defamation cause of action.

a. Defamation: Claims against Gallagher and Romero

In their third issue, Appellants assert that the trial court erred when it denied

Appellants’ motion to dismiss Appellees’ defamation cause of action against Gallagher

and Romero. In their brief, Appellees claim that their defamation cause of action was

directed solely at Bookout and that they do not assert a defamation claim against

Gallagher or Romero. Appellants—not satisfied with what they label Appellees’

29 “unorthodox nonsuit” because it would deny them the possibility of an award of

attorney’s fees or sanctions that comes with dismissal under the TCPA—request that

any defamation claims against Gallagher and Romero be dismissed. Thus, before we

turn our focus to whether Appellees have carried their burden under the TCPA to

present clear and specific evidence to establish a prima facie case of defamation

against Bookout, we must first consider whether the trial court erred by failing to

dismiss Appellees’ supposed defamation claims against Gallagher and Romero.

Appellants assert that, notwithstanding Appellees’ recent protestations to the

contrary, Appellees’ amended petition put Gallagher and Romero on notice that they

would have to defend against a defamation suit. Appellants base this assertion on the

following allegation contained in the “Factual Background” section of Appellees’

amended petition:

Defendants retained Counsel to deliver to Jonathan Shelley a letter . . . . The correspondence . . . contains several false and defamatory statements about the character of Pastor Shelley. A true and correct copy of the correspondence is attached hereto as Exhibit A for the purpose of demonstrating the nature of the defamatory conduct that has been committed by Defendants. [Emphasis added.] For their part, Appellees contend that their petition never specified a cause of

action for defamation against either Gallagher or Romero. This contention is based

on the wording used to assert their defamation cause of action, which provides, in

relevant part, that “Plaintiff would show that Defendants, one or all of them, intentionally

and knowingly published false and defamatory statements about Plaintiff Jonathan

30 Shelley, Plaintiff Stedfast[,] and others.” [Emphasis added.] Appellees assert that

because the phrase “Defendants, one or all of them” could refer to fewer than all

Appellants and because the petition’s factual allegations and the arguments in

Appellees’ response to the motion to dismiss made it clear that their defamation cause

of action was directed solely at Bookout, the trial court had no basis for dismissing a

nonexistent defamation claim against Gallagher or Romero.

Appellees argue that we should liberally construe their petition in their favor

and look to their intent in deciding this issue. Given that the situation presented here

is analogous to that presented by a motion to dismiss under Rule 91a of the Texas

Rules of Civil Procedure,14 Appellees’ argument has merit. See Drake v. Walker, No.

05-14-00355-CV, 2015 WL 2160565, at *3 (Tex. App.—Dallas May 8, 2015, no pet.)

(mem. op.) (holding that “when reviewing a [Rule] 91a motion to dismiss alleging that

a party’s claims have no basis in law” the court construes “the pleadings liberally in

favor of the plaintiff, looking to the pleader’s intent”); Wooley v. Schaffer, 447 S.W.3d

71, 76 (Tex. App.—Houston [14th Dist.] 2014, pet. denied) (“In conducting our

14 Rule 91a provides, in pertinent part, as follows:

[A] party may move to dismiss a cause of action on the grounds that it has no basis in law or fact. A cause of action has no basis in law if the allegations, taken as true, together with inferences reasonably drawn from them, do not entitle the claimant to the relief sought. A cause of action has no basis in fact if no reasonable person could believe the facts pleaded.

Tex. R. Civ. P. 91a.1.

31 review [of a Rule 91a motion to dismiss], . . . we must construe the pleadings liberally

in favor of the plaintiff, look to the pleader’s intent, and accept as true the factual

allegations in the pleadings to determine if the cause of action has a basis in law or

fact.”). However, we note the oddity that it is the plaintiffs who are requesting that

their petition be “liberally construed” as not asserting a cause of action against certain

parties. This somewhat unusual posture turns the traditional concept of the liberal

construction of the plaintiff’s pleadings on its head.

Because Appellants’ request for dismissal of the supposed defamation claims

against Gallagher and Romero was procedurally defective, we need not decide

whether to accept Appellees’ view of “liberal construction.” In their motion to

dismiss, Appellants did not request that Appellees’ supposed defamation claims

against Gallagher and Romero be dismissed on the grounds that they lack a basis in

law. 15 Rather, Appellants raised this issue for the first time in a single sentence in the

“Conclusion” of their reply to Appellees’ response to their motion to dismiss in which

they stated that “the Plaintiffs have not referred to any instances of defamation as to

either Ryan Gallagher or Leslye Romero at all.” While we are not aware of any cases

addressing whether a trial court may properly consider an argument raised for the first

The closest Appellants came to making such a request was their inclusion of 15

language in their prayer requesting that the trial court “finally dismiss[] all of Plaintiffs’ claims, or a portion of them as applicable.” However, this language is far too vague to be construed as a request for the dismissal of Appellees’ supposed defamation causes of action against Gallagher and Romero on the grounds that they have no basis in law.

32 time in a reply brief in support of a motion to dismiss under the TCPA, in the

analogous context of a no-evidence motion for summary judgment,16 it is well settled

that courts cannot consider arguments raised for the first time in a reply brief. LaRue

v. Chief Oil & Gas, L.L.C., 167 S.W.3d 866, 876 (Tex. App.—Fort Worth 2005, no

pet.) (holding that “a reply to a response to a no-evidence motion for summary

judgment may not contain a new no-evidence issue”); see also Wyly v. Integrity Ins. Sols.,

502 S.W.3d 901, 907 (Tex. App.—Houston [14th Dist.] 2016, no pet.) (“Because these

grounds were not raised in the motion for summary judgment, [the defendant] could

not raise them for the first time in its reply.” (citing Reliance Ins. Co. v. Hibdon, 333

S.W.3d 364, 378 (Tex. App.—Houston [14th Dist.] 2011, pet. denied) (op. on reh’g)));

Mei-Chiao Chen Wu v. City of San Antonio, No. 04-10-00836-CV, 2013 WL 4084721, at

*5 (Tex. App.—San Antonio Aug. 14, 2013, pet. denied) (mem. op. on reh’g)

(“[A]llowing arguments made in the movant’s reply to be considered, after the fact, as

independent grounds for summary judgment would subvert the orderly process

contemplated by rule 166a and put the nonmovant to an unfair burden.” (quoting

Sanders v. Capitol Area Council, 930 S.W.2d 905, 911 (Tex. App.—Austin 1996, no writ)

(op. on reh’g))). Because Appellants did not specifically request in their motion that

the trial court dismiss the supposed defamation claims against Gallagher and Romero

16 In support of our view that these contexts are analogous, we note that the TCPA specifically provides that in determining whether a legal action should be dismissed thereunder, the court may consider the same evidence as it would in deciding a summary judgment motion filed under Rule 166a. Tex. Civ. Prac. & Rem. Code Ann. § 27.006(a).

33 on the grounds that they have no basis in law and, instead, raised this issue for the

first time in their reply, we hold that the trial court did not err in declining to grant

this relief.

Moreover, we question whether a motion to dismiss under the TCPA would

have been the proper vehicle by which to seek the relief requested by Appellants. As

stated above, a party invoking the TCPA must demonstrate that a “legal action” has

been brought against it that is “based on or is in response to” an exercise of the rights

of free speech, petition, or association protected by the Act. Tex. Civ. Prac. & Rem.

Code Ann. § 27.003(a). Where, as here, a defendant seeks dismissal of a defamation

claim on the grounds that the plaintiff’s petition contains no allegations that the

defendant made any defamatory statements, it is difficult to see how the defendant

could show that the legal action was based on his exercise of free speech. In such an

instance, the plaintiff has not alleged that any statements made by the defendant were

defamatory, nor can the defendant point to any specific “speech” upon which the

legal action is based. Thus, it would appear that the defendant could not properly

invoke the TCPA. However, such a defendant is not without remedies. If, given the

ambiguity in Appellees’ petition, Gallagher and Romero were unsure as to whether

they would be required to defend against a defamation suit, they could have filed

special exceptions under Rule 91 or filed a motion to dismiss under Rule 91a on the

grounds that the defamation claims against them had no basis in law. Tex. R. Civ. P.

91, 91a.1.

34 In sum, because Appellants did not specifically request the dismissal of the

defamation claims against Gallagher and Romero on the grounds that they lack a basis

in law in their TCPA motion to dismiss—or in a separate motion to dismiss under

Rule 91a—the trial court did not err in declining to grant this relief.

We overrule Appellants’ third issue.

b. Defamation Step Two: Appellees’ Prima Facie Case against Bookout In their fourth issue, Appellants assert that the trial court erred by denying their

motion to dismiss Appellees’ defamation cause of action against Bookout. Because

Appellees concede that the TCPA applies to their defamation cause of action, we

begin our TCPA analysis with the question of whether Appellees carried their burden

under the second step to present clear and specific evidence to establish a prima facie

case of defamation against Bookout. We conclude that they did.

(i) Our analysis of the evidence of Appellees’ prima facie case will be governed by the following principles. As we have previously recognized, a specialized body of law has emerged to

define the prima facie burden a party responding to a TCPA motion to dismiss bears,

to define the words used by the Act, and to explain the Act’s concepts of proof.

Miller, 2021 WL 924843, at *8. The salient governing principles are as follows:

• To present “clear and specific” evidence, the nonmovant “must provide

enough detail to show the factual basis for its claim” and must provide

enough evidence “to support a rational inference that the allegation of

35 fact is true.” Dall. Morning News, Inc. v. Hall, 579 S.W.3d 370, 377 (Tex.

2019).

• The words “clear and specific” are defined to mean, for the former,

“‘unambiguous,’ ‘sure,’ or ‘free from doubt’” and, for the latter,

“‘explicit’ or ‘relating to a particular named thing.’” In re Lipsky, 460

S.W.3d 579, 590 (Tex. 2015) (orig. proceeding) (quoting KTRK Television,

Inc. v. Robinson, 409 S.W.3d 682, 689 (Tex. App.—Houston [1st Dist.]

2013, pet. denied)).

• “The [party responding to a TCPA motion to dismiss] may rely on

circumstantial evidence—indirect evidence that creates an inference to

establish a central fact—unless ‘the connection between the fact and the

inference is too weak to be of help in deciding the case.’” Dall. Morning

News, 579 S.W.3d at 377 (quoting Lipsky, 460 S.W.3d at 589).

• The nonmovant surmounts its burden of establishing a prima facie case

when the evidence presented is “sufficient as a matter of law to establish

a given fact if it is not rebutted or contradicted.” Lipsky, 460 S.W.3d at

590. Stated differently, the burden is met by “the ‘minimum quantum of

evidence necessary to support a rational inference that the allegation of

fact is true.’” Id. (quoting In re E.I. DuPont de Nemours & Co., 136 S.W.3d

218, 223 (Tex. 2004) (orig. proceeding)).

36 • Statements that are conclusory or evidence that is speculative is not

sufficient to carry the nonmovant’s burden. Mogged v. Lindamood, No. 02-

18-00126-CV, 2020 WL 7074390, at *9 (Tex. App.—Fort Worth Dec. 3,

2020, pet. denied) (en banc mem. op. on reh’g).

(ii) There are four elements of defamation. “Defamation’s elements include: (1) the publication of a false statement of fact

to a third party, (2) that was defamatory concerning the plaintiff, (3) with the requisite

degree of fault, and (4) damages, in some cases.” Lipsky, 460 S.W.3d at 593 (first

citing WFAA–TV, 978 S.W.2d at 571; and then citing Waste Mgmt. of Tex., 434 S.W.3d

at 146 n.7). As noted above, “[a] statement is defamatory if it tends to harm the

reputation of another so as to lower him in the estimation of the community or to

deter third persons from associating or dealing with him, or if it tends to expose him

to public hatred, contempt, or ridicule.” Hanssen, 938 S.W.2d at 92 (citing Hardwick,

881 S.W.2d at 197).

The “requisite degree of fault” depends on whether the person defamed is a

private individual or a public figure. Lipsky, 460 S.W.3d at 593. “A private individual

need only prove negligence, whereas a public figure or official must prove actual

malice.” Id. (citing WFAA–TV, 978 S.W.2d at 571). In the context of a defamation

claim, “actual malice” means that the statement was made with knowledge of its

falsity or with reckless disregard for its truth. Id. (citing Huckabee v. Time Warner Ent.

Co., 19 S.W.3d 413, 420 (Tex. 2000)).

37 Finally, with respect to damages, they must be pleaded and proven unless the

statements at issue are defamatory per se. Id. (citing Waste Mgmt. of Tex., 434 S.W.3d

at 146 n.7). For a statement to be defamatory per se, it must fall within one of four

categories: (1) imputation of a crime; (2) imputation of a loathsome disease; (3) injury

to a person’s office, business, profession, or calling; or (4) imputation of sexual

misconduct. Gray, 941 S.W.2d at 329.

(iii) In reviewing whether Appellees established a prima facie claim for defamation, we do not require prima facie proof that every statement allegedly made by Appellants was defamatory. As we recently clarified, we are not required to determine that every statement

that Bookout made is defamatory in order to conclude that Appellees carried their

burden to prove that they have a viable cause of action for defamation. Miller, 2021

WL 924843, at *9 (citing Stone v. Melillo, No. 14-18-00971-CV, 2020 WL 6143126, at

*5 (Tex. App.—Houston [14th Dist.] Oct. 20, 2020, no pet.) (mem. op.)). Instead, the

inquiry is whether Appellees presented sufficient proof to establish a viable

defamation cause of action, and that task requires only that we determine whether any

of the statements made by Bookout were defamatory.17 As we, quoting one of our

sister courts, explained in Miller:

While the TCPA requires that each legal claim be analyzed individually, the TCPA does not require that each factual basis or theory of recovery

This is in contrast to our analysis of whether the trial court could properly 17

exercise jurisdiction over Appellees’ defamation cause of action, which was, by necessity, statement-specific. See supra Section III.A.3.a.

38 underpinning a cause of action must be analyzed separately. Tex. Civ. Prac. & Rem. Code [Ann.] § 27.005(c). Here, Appellees have a single defamation cause of action, which is based upon statements made by [Appellant] . . . . If Appellees are successful in presenting prima facie proof in support of their defamation claim as to any of the statements . . . , then Appellees will have met their burden under the second step. See Thang Bui[ v. Dangelas, No. 01-18-01146-CV], 2019 WL 5151410, at *5 [(Tex. App.—Houston [1st Dist.] Oct. 15, 2019, pet. denied) (mem. op.)]; see generally Landry’s, Inc.[ v. Animal Legal Def. Fund], 566 S.W.3d [41,] 53–57 [(Tex. App.—Houston [14th Dist.] 2018), aff’d in part, rev’d in part, 631 S.W.3d 40 (Tex. 2021)]. The TCPA does not require that Appellees produce evidence that each and every statement . . . is defamatory to meet their burden under the TCPA[ ] or to prove their cause of action at a trial on the merits. Rather, Appellees must establish “a prima facie case for each essential element” of their defamation claim against [Appellant]. Tex. Civ. Prac. & Rem. Code [Ann.] § 27.005(c). Id. (quoting Stone, 2020 WL 6143126, at *6). Thus, our analysis will focus on each

element of defamation, not each alleged defamatory statement.

(iv) With regard to the first element of defamation, there is prima facie proof that Bookout published a false statement of fact about Shelley to a third party. The principles that guide the determination of whether Appellees have

established prima facie proof of the first element of their defamation claim are as

follows:

• Did Bookout make statements of fact? This determination turns on

whether the statements are verifiable. See Dall. Morning News, Inc. v.

Tatum, 554 S.W.3d 614, 624 (Tex. 2018) (“If a statement is not verifiable

as false, it is not defamatory. Similarly, even when a statement is

verifiable as false, it does not give rise to liability if the ‘entire context in

39 which it was made’ discloses that it is merely an opinion masquerading as

a fact.” (citations omitted) (quoting Bentley v. Bunton, 94 S.W.3d 561, 581

(Tex. 2002))).

• Did Bookout publish the statements? “‘Publication’ occurs if the

defamatory statements are communicated orally, in writing, or in print to

some third person who is ‘capable of understanding their defamatory

import and in such a way that the third person did so understand.’”

Exxon Mobile Corp. v. Rincones, 520 S.W.3d 572, 579 (Tex. 2017) (quoting

Austin v. Inet Techs., Inc., 118 S.W.3d 491, 496 (Tex. App.—Dallas 2003,

no pet.)).

• Were Bookout’s statements false? Because Appellees concede that they

are public figures for limited purposes, they bore the burden to establish

the statements’ falsity. See Vice v. Kasprzak, 318 S.W.3d 1, 16 (Tex.

App.—Houston [1st Dist.] 2009, pet. denied) (citing Bentley, 94 S.W.3d at

586).

Appellees have shown evidence that Bookout made at least two actionable

statements of fact.18 Bookout’s statement that Shelley had physically abused his

children and his statement implying that Shelley had embezzled funds from Stedfast

18 In considering whether Appellees have established their prima facie case for defamation, we will consider only those statements that may properly form the basis of a defamation claim under the ecclesiastical abstention doctrine. See supra Section III.A.3.a.

40 are verifiable. Indeed, Bookout stated that he personally witnessed Shelley slap his

son “full power” in the face at church—a claim that Shelley vehemently denies. Such

eyewitness testimony of an alleged historical event certainly constitutes a verifiable

statement of fact. Cf. S.V. v. R.V., 933 S.W.2d 1, 40 (Tex. 1996) (Cornyn, J.,

concurring on reh’g) (listing an “objective eyewitness’s account” as an example of

“objectively verifiable evidence”).

Appellants assert that Appellees cannot show that Bookout made any

actionable statements of fact because the general tenor of Bookout’s YouTube

channel is satirical. The Texas Supreme Court has stated that in defamation cases

involving satire or parody, “the test is whether the publication could be reasonably

understood as describing actual facts.” New Times, Inc. v. Isaacks, 146 S.W.3d 144, 157

(Tex. 2004) (citing Pring v. Penthouse Int’l, Ltd., 695 F.2d 438, 442 (10th Cir. 1982)).

This inquiry is an objective one, and in applying this test, “courts must analyze the

words at issue with detachment and dispassion, considering them in context and as a

whole, as the reasonable reader would consider them.” Id. at 157–58.

Analyzing Bookout’s videos under this standard, it is clear that they include

actionable statements of fact. For example, according to Shelley, Bookout’s exact

statements concerning Shelley’s alleged child abuse were as follows:

I don’t know how bad of a beating a one year old has to take that they’re not able to walk straight or they’re not able to develop walking correctly until later, but it couldn’t have been a beating that the kid deserved. Not at one. What kind of man does that to his own child, I don’t even know. Even another child, a one year old. It’s disgusting. And I have every

41 reason to think this is true. First, in my own testimony, I’ve seen Shelley slap his own kid in the face full power at church, in front of everybody. Another time I saw his kid fall down outside of a restaurant, looked at his mom, and Shelley, you know, came to pick him up, and you saw the kid go from crying to—freeze. Like an animal scared that a predator was gonna eat him. Another one of his boys came to church for a while with a broken limb. But more than just my testimony, the contractor that did work on that guy’s house told me that that guy, he was surprised that CPS wasn’t going to come take that guy’s kids because he would just beat them all just so badly. By any objective measure, this excerpt contains statements of fact. Bookout is, in

essence, testifying as an eyewitness to alleged child abuse. It is difficult to conceive of

a more clear-cut example of a statement that could be reasonably understood as

describing actual facts. Thus, we reject Appellants’ argument that the supposed

satirical nature of Bookout’s videos prevents Appellees from proving the first element

of their defamation claim.

Moreover, the statements were “published.” It is undisputed that Bookout

made these statements in videos that he posted to YouTube, where they were viewed

by people capable of understanding their defamatory import. This satisfies the

“publication” requirement. Cf. Hosseini v. Hansen, No. 04-17-00790-CV, 2019 WL

1262276, at *3 (Tex. App.—San Antonio Mar. 20, 2019, pet. denied) (mem. op.)

(holding statements posted on Facebook that were “liked” and “shared” satisfied the

publication requirement for a defamation claim).

With respect to falsity, Shelley has denied ever physically abusing his children

or embezzling funds from Stedfast. As we have previously recognized, at the TCPA

42 motion-to-dismiss stage where one party claims an event occurred and the other

claims it did not, a plaintiff’s denial can satisfy his burden to present prima facie

evidence of falsity. Miller, 2021 WL 924843, at *10; see also Van Der Linden v. Khan,

535 S.W.3d 179, 198 (Tex. App.—Fort Worth 2017, pet. denied) (holding plaintiff

“met his burden under chapter 27 to establish by clear and specific evidence a prima

facie case for the essential element of falsity” by denying the defendant’s allegations

that he had given money to the Taliban or had told the defendant that he had). Here,

as in Miller, “the clash between the statement that an action occurred and the denial

that it did is evidence that the person making the statement spoke falsely.” Miller,

2021 WL 924843, at *11.

Appellants argue that Shelley’s denials are insufficient to satisfy Appellees’

burden because Appellees could have offered additional evidence such as Stedfast’s

financial records to prove the falsity of the embezzlement claim. 19 While it is true that

Appellees could have produced additional evidence, the issue here is whether they

19 As noted above, in order to satisfy their burden under the second step of the TCPA, Appellees need not establish that all of the statements on which they base their defamation claim are false; rather, they can satisfy their burden by showing that any one of the statements is false. See Stone, 2020 WL 6143126, at *6. Thus, even if we were to agree with Appellants that the lack of financial records prevents Appellees from establishing the falsity of Bookout’s embezzlement allegation, they could still satisfy their burden by showing that Bookout’s accusation that Shelley abused his children was false. See id. Because Shelley has unequivocally denied abusing his children—and has thus presented prima facie evidence of the falsity of this allegation, see Miller, 2021 WL 924843, at *11—whether Appellees’ failure to produce financial records prevents them from being able to show the falsity of Bookout’s embezzlement claim is an academic question. However, in the interest of completeness, we address this argument. See Carr, 884 S.W.2d at 803.

43 produced sufficient evidence to establish a prima facie case. Shelley has unequivocally

denied misappropriating any funds from Stedfast and has stated that he paid for his

home remodel with his personal funds. Moreover, Bookout has admitted that the

contractor who performed the remodeling services on Shelley’s home provided him

with copies of checks Shelley wrote from his own personal bank account to pay for

the remodel. Given that a nonmovant satisfies his burden if he presents evidence that

is “sufficient as a matter of law to establish a given fact if it is not rebutted or

contradicted,” we conclude that Shelley’s unequivocal denial combined with the

corroborative evidence that he used personal checks to pay for his home remodel is

sufficient to create a rational inference that Bookout’s allegation that Shelley used

church funds to pay for the remodel is false. Lipsky, 460 S.W.3d at 590. The TCPA

does not require nonmovants to marshal all of their evidence at this early stage of the

litigation but merely “the ‘minimum quantum of evidence necessary to support a

rational inference that the allegation of fact is true.’” Id. (quoting E.I. DuPont de

Nemours & Co., 136 S.W.3d at 223). Appellees have met this burden.

(v) With regard to the second element of defamation, there is prima facie proof that Bookout’s statements about Shelley were reasonably capable of a defamatory meaning. The elementary question in establishing that a statement is defamatory turns on

whether it “tends [ ] to harm the reputation of another as to lower him in the

estimation of the community or to deter third persons from associating or dealing

44 with him.” Innovative Block of S. Tex., Ltd. v. Valley Builders Supply, Inc., 603 S.W.3d 409,

417 (Tex. 2020) (quoting Restatement (Second) of Torts § 559 (Am. L. Inst. 1977)).

Answering this question involves two independent steps: (1) determining whether the

meaning that the plaintiff assigns to the statement is reasonably capable of arising

from the text of which the plaintiff complains and (2) determining whether the

meaning ascribed to the statement by the plaintiff is reasonably capable of defaming

the plaintiff. Tatum, 554 S.W.3d at 625. Whether a statement is defamatory is a legal

question. Innovative Block, 603 S.W.3d at 419–20.

The Texas Supreme Court recently established new categories to address these

questions and abandoned—other than for the purpose of presuming general

damages—the long-used categories of defamation per se and per quod as descriptors

of whether a statement was defamatory “by its text alone.”20 Tatum, 554 S.W.3d at

625–26. Under the supreme court’s new parlance, “defamation that arises from the

statement’s text without reference to any extrinsic evidence” is classified as “textual

defamation,” not defamation per se. Id. at 626. On the other hand, “defamation that

The supreme court established these new categories for the sake of clarity. 20

Tatum, 554 S.W.3d at 626. Before Tatum, Texas courts used the terms “defamation per se” and “defamation per quod” to distinguish defamatory statements in two different ways: first, to distinguish between “a statement that is defamatory by its text alone and a statement that is defamatory only by reason of ‘extrinsic evidence’” and second, to distinguish “between defamation which is actionable of itself and that which requires proof of special damage.” Id. at 625–26. Because Texas courts and legal practitioners had begun to use the terms indiscriminately in both senses, the supreme court created new labels for the first type of distinction—whether a statement is defamatory by its text alone or only by reason of extrinsic evidence—to avoid confusion. Id. at 626.

45 does require reference to extrinsic circumstances” is categorized as “extrinsic

defamation,” not defamation per quod. Id.

Here, Appellees assert that Bookout has accused Shelley of physically abusing

his children and of embezzling money from Stedfast, both of which are crimes.

Because being accused of a crime is acknowledged as being obviously harmful to

one’s reputation, these accusations are reasonably capable of defaming Shelley. See,

e.g., Lipsky, 460 S.W.3d at 596. Thus, our analysis of whether Appellees have satisfied

their burden will focus on the first step of the process promulgated by the supreme

court—whether the meaning that Appellees assign to Bookout’s publications is

reasonably capable of arising from the statements of which they complain. See Tatum,

554 S.W.3d at 625.

Bookout’s accusation that Shelley physically abused his children is explicitly

defamatory and is thus a classic example of textual defamation. See id. at 626–27.

Bookout’s statement that he personally witnessed Shelley slap his child “full power”

requires no extrinsic evidence to perceive its defamatory meaning. Thus, this

statement is defamatory.

Unlike the accusation of child abuse, Bookout’s accusation of embezzlement is

not explicit. The allegedly defamatory statement upon which Appellees rely is

contained in a YouTube video Bookout posted in August 2021. In the video,

Bookout remarks that Shelley “got a house remodel out of the deal,” which Shelley

interprets as implying that he improperly used church money to pay for the

46 remodeling of his home. As Appellants have pointed out, this statement is not

defamatory on its face. The question then is whether this facially innocent statement

“becomes defamatory when considered in light of ‘other facts and circumstances

sufficiently expressed before’ or otherwise known to” the viewers of Bookout’s

YouTube channel. Id. at 626 (quoting Snider v. Leatherwood, 49 S.W.2d 1107, 1109

(Tex. App.—Eastland 1932, writ dism’d w.o.j.)). We believe that it does. As Bookout

acknowledged in the proceedings below, there had been rumors as early as 2019 that

Shelley and his mentor Steve Anderson had been stealing money from the church to

pay for Anderson’s house remodel and that people both inside and outside the church

had been questioning Shelley’s motivation for becoming Stedfast’s pastor. Moreover,

Bookout further acknowledges that he posted a video on his YouTube channel in

March or April 2020 of Shelley addressing these rumors. According to Bookout,

given the rumors of financial misconduct, church members asked him to investigate

Shelley’s house remodel by getting in touch with the contractor performing the work

on Shelley’s home, and Bookout did, in fact, obtain images of checks Shelley had

provided to the contractor. Bookout proceeded to display these check images in a

YouTube video entitled “House Remodel” in which he, in his own words,

“juxtapose[d] the check images with statements by . . . Shelley to highlight [the]

peculiarity of the content and timing [of] his statements regarding rumored church

theft for Anderson’s remodel, and his own actual house remodel being conducted

shortly thereafter.” Given the rumors of financial misconduct and Bookout’s

47 previously posted YouTube content, a viewer of Bookout’s YouTube channel could

reasonably be expected to perceive Bookout’s statement that Shelley “got a house

remodel out of the deal” as implying that Shelley had embezzled funds from Stedfast.

Therefore, this statement is defamatory.

(vi) With regard to the third element of defamation, there is prima facie proof that Bookout acted with the requisite degree of fault. As noted above, the “requisite degree of fault” that a defamation plaintiff must

prove depends on whether the person defamed is a private individual or a public

figure. Lipsky, 460 S.W.3d at 593. “A private individual need only prove negligence,

whereas a public figure or official must prove actual malice.” Id. (citing WFAA–TV,

978 S.W.2d at 571). As Appellees concede that they are limited-purpose public

figures, they are required to prove that Bookout acted with actual malice. See

WFAA–TV, 978 S.W.2d at 573.

We have recently discussed the imprecise standards governing the actual-malice

determination, which turns on the subjective awareness of the defendant regarding

the truth of the statements in question but is also impacted to a certain degree by an

injurious motive, though that motive is not determinative. Miller, 2021 WL 924843, at

*15. In Miller, we quoted language from an opinion of the Tyler Court of Appeals

exploring the parameters of the actual-malice determination, which bears repeating

here:

48 To establish actual malice, a plaintiff must show a defamatory statement was published with either knowledge of its falsity or reckless disregard for its truth. Lipsky, 460 S.W.3d at 593. Reckless disregard is a subjective standard, focusing on the defendant’s state of mind. Forbes Inc. v. Granada Biosciences, Inc., 124 S.W.3d 167, 171 (Tex. 2003) (citing Bentley . . . , 94 S.W.3d [at] 591 . . . ). Mere negligence is not enough. Id. “Rather, the plaintiff must establish ‘that the defendant in fact entertained serious doubts as to the truth of his publication,’ or had a ‘high degree of awareness of . . . [the] probable falsity’ of the published information.” Id. (quoting Harte–Hanks Commc’ns, Inc. v. Connaughton, 491 U.S. 657, 688, 109 S. Ct. 2678, 2696 . . . (1989)). The evidence must be viewed in its entirety. Campbell [v. Clark], 471 S.W.3d [615,] 629 [(Tex. App.—Dallas 2015, no pet.)]. Further, “[a] defendant’s state of mind ‘can—indeed, must usually—be proved by circumstantial evidence.’” Id. (quoting Bentley, 94 S.W.3d at 591). Specifically, the supreme court stated the following: A lack of care or an injurious motive in making a statement is not alone proof of actual malice, but care and motive are factors to be considered. An understandable misinterpretation of ambiguous facts does not show actual malice, but inherently improbable assertions and statements made on information that is obviously dubious may show actual malice. A failure to investigate fully is not evidence of actual malice; a purposeful avoidance of the truth is. Id. (quoting Bentley, 94 S.W.3d at 597). In addition, the supreme court stressed that proof of actual malice is not defeated by a defendant’s self- serving protestation of sincerity. Id. Miller, 2021 WL 924843, at *15–16 (quoting MediaOne, L.L.C. v. Henderson, 592 S.W.3d

933, 942–43 (Tex. App.—Tyler 2019, pet. denied)). Actual malice must be established

by clear and convincing evidence. Bentley, 94 S.W.3d at 596.

Appellees have presented prima facie proof that Bookout acted with actual

malice. First, as Appellees point out, Bookout has acknowledged that the contractor

who remodeled Shelley’s home provided him with copies of the checks Shelley wrote

49 to pay for the remodeling services and that these checks were written on Shelley’s

personal account, not Stedfast’s. Thus, at the time Bookout made the statement

implying that Shelley had embezzled funds to pay for his house remodel, Bookout

was in possession of evidence that, though short of conclusive proof of innocence,

was nonetheless exculpatory.

Moreover, with regard to Bookout’s statement that he witnessed Shelley slap

his child “full power” across the face, Shelley categorically denies that this event ever

took place. As we have previously recognized, “actual malice may be inferred if the

plaintiff demonstrates that the defamatory statement had no basis in fact, was

fabricated by the defendant, or was the product of her imagination.” Miller, 2021 WL

924843, at *17 (quoting Ratner v. Kohler, Civ. No. 17-00542 HG-KSC, 2018 WL

1055528, at *9 (D. Haw. 2018) (order)); see also Bentley, 94 S.W.3d at 596 (“Professions

of good faith will be unlikely to prove persuasive, for example, where a story is

fabricated by the defendant[ or] is the product of his imagination . . . .” (quoting St.

Amant v. Thompson, 390 U.S. 727, 732, 88 S. Ct. 1323, 1326 (1968))). Thus, where, as

here, two parties have dramatically opposed versions of events, a plaintiff’s claim of

falsity is evidence both that the statement was false and that the defendant necessarily

knew it was false at the time he said it because—if the plaintiff’s version of events is

correct—it never occurred. See Miller, 2021 WL 924843, at *17 (citing Chastain v.

Hodgdon, No. 16-2087, 2016 WL 5109944, at *2 (D. Kan. Sept. 20, 2016) (mem. &

order)).

50 Further, though an injurious motive is not determinative of actual malice, it is a

factor that may be considered. See Campbell, 471 S.W.3d at 629 (quoting Bentley, 94

S.W.3d at 597). Here, Appellees have presented evidence that Bookout had a falling

out with Shelley and that, in addition to launching what Shelley describes as a “smear

campaign” against him, Bookout posted documents containing Shelley’s social

security number and other sensitive personal information on YouTube accompanied

by the caption “Who wants to open a credit card?” This evidence raises an inference

of an injurious motive and, in combination with the other evidence, is relevant to

Bookout’s subjective belief regarding whether his statements were true. Thus, the

record supports an inference that Bookout acted with actual malice.

(vii) Because Bookout’s statements constitute defamation per se, Appellees are not required to prove damages. As we noted above, though the terms defamation per se and defamation

per quod have fallen out of favor in describing the defamatory sting of a statement,

they remain viable in determining whether the statement produces a presumption of

damage. 21 Tatum, 554 S.W.3d at 626. “Historically, defamation per se has involved

21 In their briefing, Appellants argue that because Bookout’s statement that Shelley “got a house remodel out of the deal” requires extrinsic evidence to show its defamatory meaning, it does not constitute defamation per se, and therefore, Appellees must present evidence of damages. This argument reflects Appellants’ confusion regarding the usage of the terms defamation per se and defamation per quod to describe a statement’s defamatory sting as opposed to its presumption of damage. As set forth above, under the Texas Supreme Court’s new categorization framework, whether a statement is explicitly defamatory or requires extrinsic evidence to show its defamatory nature now categorizes it as either “textual defamation” or

51 statements that are so obviously hurtful to a plaintiff’s reputation that the jury may

presume general damages.” Hancock v. Variyam, 400 S.W.3d 59, 63 (Tex. 2013).

Again, “[a]ccusing someone of a crime, of having a foul or loathsome disease, or of

engaging in serious sexual misconduct are examples of defamation per se.” Lipsky,

460 S.W.3d at 596.

With certain qualifications,22 the existence of defamation per se permits a

presumption of general damages. Miller, 2021 WL 924843, at *18. Thus, prima facie

proof of a viable defamation per se claim obviates the need for a party responding to

a TCPA motion to dismiss to present clear and specific evidence of damages. Lipsky,

460 S.W.3d at 596 (“Pleading and proof of particular damage is not required to prevail

on a claim of defamation per se, and thus actual damage is not an essential element of

the claim to which the TCPA’s burden of clear and specific evidence might apply.”).

Here, Appellees have presented prima facie evidence that Bookout accused

Shelley of two potential crimes: child abuse and embezzlement. We therefore

consider these statements to be defamatory per se and conclude that the presumption

“extrinsic defamation.” See supra note 20. A statement that imputes the commission of a crime constitutes defamation per se regardless of whether extrinsic evidence is required to show its defamatory meaning. See Tatum, 554 S.W.3d at 625–26. 22 The Texas Supreme Court has explained that “the Constitution only allows juries to presume the existence of general damages in defamation per se cases where: (1) the speech is not public, or (2) the plaintiff proves actual malice.” Hancock, 400 S.W.3d at 65–66 (first citing Dun & Bradstreet, Inc. v. Greenmoss Builders, Inc., 472 U.S. 749, 761, 105 S. Ct. 2939, 2946 (1985); and then citing Gertz v. Robert Welch, Inc., 418 U.S. 323, 349–50, 94 S. Ct. 2997, 3011–12 (1974)). Because, as detailed above, Appellees have presented proof of actual malice, this requirement is met.

52 of general damages frees Appellees from having to present prima facie proof of

damages.

c. Defamation Step Three: Bookout’s Affirmative Defenses Having determined that Appellees have presented clear and specific evidence

establishing a prima facie case for each essential element of their defamation claim, we

must now consider whether Bookout has established an affirmative defense that

would entitle him to judgment as a matter of law. Tex. Civ. Prac. & Rem. Code Ann.

§ 27.005(c)–(d). In the trial court, Bookout asserted two affirmative defenses to

Appellees’ defamation claim: statute of limitations and qualified privilege.23

However, because Appellants’ initial brief in this court makes no mention of either

defense, we consider both of these defenses to have been waived for purposes of this

appeal.

None of Appellants’ briefing makes any reference whatsoever to the defense of

qualified immunity. Thus, this defense has been waived. See Tex. R. App. P. 38.1(i)

(“The brief must contain a clear and concise argument for the contentions made, with

appropriate citations to authorities and to the record.”); Jackson v. Vaughn, 546 S.W.3d

913, 922 (Tex. App.—Amarillo 2018, no pet.) (finding issue waived due to inadequate

briefing); City of Alton v. City of Mission, 164 S.W.3d 861, 870 (Tex. App.—Corpus

23 We note that in their brief, Appellees referenced “[s]tatements are [o]pinions” as a defense asserted by Appellants. However, whether a statement asserts a verifiable fact or constitutes the mere expression of an opinion is part of the first element of defamation, not an affirmative defense. See Bentley, 94 S.W.3d at 579–81.

53 Christi–Edinburg 2005, pet. denied) (holding appellant’s asserted fact issue related to

an affirmative defense had been waived due to inadequate briefing).

Moreover, while Appellants assert in their reply brief that Bookout’s alleged

statements accusing Shelley of child abuse are barred by the statute of limitations, this

argument was not raised in their initial brief in this court. The Texas Rules of

Appellate Procedure do not allow parties to add a new issue in their reply brief that

was not discussed in their original brief. See Tex. R. App. P. 38.3; Stovall & Assocs. v.

Hibbs Fin. Ctr., Ltd., 409 S.W.3d 790, 803 (Tex. App.—Dallas 2013, no pet.); Howell v.

Tex. Workers’ Comp. Comm’n, 143 S.W.3d 416, 439 (Tex. App.—Austin 2004, pets.

denied); see also Molho v. Weichert, Realtors Reichardt & Assocs., No. 14-11-00861-CV,

2012 WL 6631732, at *3 n.6 (Tex. App.—Houston [14th Dist.] Dec. 20, 2012, pet.

denied) (mem. op.) (“Arguments may not be raised for the first time in a reply brief.”

(citing Brown v. Green, 302 S.W.3d 1, 13–14 (Tex. App.—Houston [14th Dist.] 2009,

no pet.))). Thus, this defense has also been waived for purposes of this appeal. See

Stovall, 409 S.W.3d at 803 (“[A]n issue raised for the first time in a reply brief is

ordinarily waived and may not be considered by this Court.”).

Even if the limitations defense had not been waived, it still would not entitle

Bookout to judgment as a matter of law. By Appellants’ own admission, the

limitations defense only applies to Bookout’s alleged statements accusing Shelley of

child abuse, not his statement implying that Shelley embezzled money from Stedfast

to pay for a home remodel. Thus, even assuming Bookout’s limitations defense were

54 valid, Appellees would still have a viable defamation claim, and Bookout would not be

entitled to judgment as a matter of law. See Stone, 2020 WL 6143126, at *6–7 (holding

that a defamation plaintiff can meet its burden under the second step of the TCPA by

presenting prima facie proof of any statement upon which the defamation claim is

based and concluding that “each alleged defamatory statement is not a separate ‘legal

claim’ under the TCPA”).

Because Appellees have presented clear and specific evidence establishing a

prima facie case for each essential element of their defamation claim and Bookout has

not established an affirmative defense that would entitle him to judgment as a matter

of law, we overrule Appellants’ fourth issue.

d. Declaratory Relief and Conversion Causes of Action Step One: Does the TCPA Apply? In their fifth and sixth issues, Appellants assert that the trial court erred in

denying their motion to dismiss Appellees’ causes of action for declaratory relief and

conversion. Because Appellees contend that the TCPA does not apply to these

causes of action, we must first address whether Appellants have satisfied their initial

burden to demonstrate that these claims are “based on” or “in response to” an

exercise of Appellants’ rights of free speech, petition, or association as defined in the

Act. Tex. Civ. Prac. & Rem. Code § 27.003(a).

Appellants argue that Appellees’ declaratory judgment and conversion causes

of action are subject to the TCPA because they are “based on” or were filed “in

55 response to” Appellants’ exercise of the right of association. See id. Under the TCPA,

“‘[e]xercise of the right of association’ means to join together to collectively express,

promote, pursue, or defend common interests relating to a governmental proceeding

or a matter of public concern.” Id. § 27.001(2). “‘Matter of public concern’ means a

statement or activity regarding: (A) a public official, public figure, or other person

who has drawn substantial public attention due to the person’s official acts, fame,

notoriety, or celebrity; (B) a matter of political, social, or other interest to the

community; or (C) a subject of concern to the public.” Id. § 27.001(7). Thus, the

applicability of the TCPA to these causes of action turns on whether Appellants, by

(1) holding a meeting to appoint Gallagher and Bookout as directors of Stedfast and

to appoint themselves as officers, (2) purporting to terminate Shelley for cause,

(3) seizing control of Stedfast’s bank accounts, and (4) seeking to investigate Stedfast’s

finances and wind down its affairs, joined together to collectively pursue or defend

“common interests” relating to “a matter of public concern.”

Appellees, relying on our decision in Kawcak v. Antero Resources Corporation, 582

S.W.3d 566 (Tex. App.—Fort Worth 2019, pet. denied), assert that Appellants have

not carried their burden to show that the TCPA applies to Appellees’ declaratory

judgment and conversion claims because they have not shown that they were acting to

pursue or defend “common interests.” In Kawcak, following a “straightforward but

admittedly long” analysis, we determined that the word “common” as used in the

TCPA “requires more than two tortfeasors conspiring to act tortiously for their own

56 selfish benefit.” Id. at 573, 588. Appellees argue that Appellants have only shown

that they joined together to pursue their own selfish interests and that there is no

evidence in the record to suggest that the supposedly “common interest” to dissolve

Stedfast was shared by anyone other than Appellants themselves. Thus, according to

Appellees, the interests pursued or defended by Appellants are not “common” as

defined by this court in Kawcak.

However, as Appellants point out, the present case is distinguishable from

Kawcak. Unlike the appellant in Kawcak, who candidly admitted to conspiring to

engage in tortious and illegal behavior,24 Appellants’ sole motivation in joining

together was not to commit a tort. Indeed, both Romero and Gallagher have testified

that their motivation was to investigate and provide full transparency of Stedfast’s

finances. Bookout similarly—albeit vaguely—testified that Appellants’ motivation

was “to follow the law.” If—as Appellants claim—Shelley was misappropriating

Stedfast’s funds, this would be a matter of common concern for all church members.

Thus, Appellants have provided evidence that they joined together to pursue or

defend a “common interest.”

Moreover, we do not view Appellees’ status as public figures to be reasonably

in doubt. Indeed, Appellees have conceded that they are, at a minimum, limited-

purpose public figures under the standards relevant to their defamation claim, and

they have not challenged Appellants’ assertion that they are public figures for

24 See generally id. at 569–71.

57 purposes of the TCPA. As Appellants point out, the management of Stedfast’s affairs

has been an ongoing topic of public discussion and has been the subject of several

national news articles. Thus, there is evidence that the “common interests”

Appellants joined together to defend or pursue relate to a “matter of public concern”

as defined in the TCPA.

Further, it is clear that Appellees’ causes of action for declaratory judgment and

conversion are “based on” or were filed “in response to” Appellants’ actions in

joining together to investigate Stedfast’s finances and wind down its affairs. Both

causes of action center around whether Appellants or the Shelley Group are the

rightful directors of Stedfast. But for Appellants’ actions in joining together to assert

control of Stedfast, neither cause of action would have been filed.

Thus, Appellants have met their burden to show that Appellees’ declaratory

judgment and conversion causes of action are “based on” or “in response to”

Appellants’ “exercise of the right of association” as defined in the TCPA. Tex. Civ.

Prac. & Rem. Code Ann. §§ 27.001(2), .003(a). Accordingly, we must now proceed to

the second step of our TCPA analysis of these claims.

e. Conversion Step Two: Prima Facie Case

Having determined that Appellants have satisfied their initial burden to invoke

the TCPA as to Appellees’ conversion and declaratory judgment claims, we must

58 now—guided by the same principles set forth above25—consider whether Appellees

have presented clear and specific evidence establishing a prima facie case for each

essential element of these claims. We will first consider Appellees’ evidence of

conversion.

(i) There are three elements of conversion.

To prevail on a claim for conversion, a plaintiff must show that (1) he owned,

possessed, or had the right to immediate possession of personal property; (2) the

defendant unlawfully and without authorization exercised dominion or control over

the property to the exclusion of, or inconsistent with, the plaintiff’s rights; and (3) the

plaintiff suffered injury.26 Truitt v. Hatfield, No. 02-21-00004-CV, 2021 WL 5742083,

at *5 (Tex. App.—Fort Worth Dec. 2, 2021, no pet.) (mem. op.) (first citing United

Mobile Networks, 939 S.W.2d at 147–48; and then citing Lopez, 271 S.W.3d at 784).

25 See supra Section III.B.3.b.(i). 26 The parties, relying on two opinions from the Dallas Court of Appeals, seem to agree that a plaintiff must also show that he demanded return of the property and that the defendant refused to return it. See Bailey v. Gallagher, 348 S.W.3d 322, 328 (Tex. App.—Dallas 2011, pet. denied); Tex. Integrated Conveyor Sys., Inc. v. Innovative Conveyor Concepts, Inc., 300 S.W.3d 348, 365–66 (Tex. App.—Dallas 2009, pet. denied) (op. on reh’g). However, as discussed more fully below, when, as in the present case, the defendant’s actions constitute a clear repudiation of the plaintiff’s rights, demand of return is not required. See, e.g., Burns v. Rochon, 190 S.W.3d 263, 270 n.2 (Tex. App.—Houston [1st Dist.] 2006, no pet.) (citing Presley v. Cooper, 284 S.W.2d 138, 141 (Tex. 1955)).

59 (ii) With regard to the first element of conversion, there is prima facie evidence that Stedfast owned, possessed, or had the right to immediate possession of personal property. There is ample record evidence to show—and Appellants do not dispute—that

Stedfast maintained deposit accounts at Chase Bank, that Shelley and another church

employee were the signatories on those accounts, and that Stedfast owned, possessed,

or had the right to immediate possession of those funds. Thus, to the extent that

Stedfast’s bank accounts constitute personal property that may be the proper subject

of a conversion claim, 27 Appellees have satisfied their burden with respect to this

element.

27 While we reserve judgment on this issue, we note that there is case law suggesting that though special deposits—which are accompanied by an agreement that the identical deposit will be returned or paid out for a specific purpose—can be converted, general bank deposits—which create a debtor–creditor relationship between the bank and the depositor—cannot. See Hodge v. N. Tr. Bank of Tex., N.A., 54 S.W.3d 518, 522 (Tex. App.—Eastland 2001, pet. denied); cf. Edlund v. Bounds, 842 S.W.2d 719, 727 (Tex. App.—Dallas 1992, writ denied) (op. on reh’g) (“An action for the conversion of money will lie if the money can be identified as a specific chattel. [But] ‘[w]hen an indebtedness can be discharged by payment of money generally, an action in conversion is inappropriate.’” (citation omitted) (quoting Eckman v. Centennial Sav. Bank, 757 S.W.2d 392, 398 (Tex. App.—Dallas 1988, writ denied))). However, we also recognize that the first element of conversion concerns ownership or possession of personal property and that the Texas version of the Uniform Commercial Code identifies deposit accounts as a form of personal property. See Tex. Bus. & Com. Code Ann. § 9.102(a)(42) (defining “general intangibles” to mean “any personal property, including things in action, other than . . . deposit accounts”); see also id. § 9.102(a)(29) (defining “deposit account” to mean “a demand, time, savings, passbook, or similar account maintained with a bank”). But see Express One Int’l v. Steinbeck, 53 S.W.3d 895, 901 (Tex. App.—Dallas 2001, no pet.) (noting that intangible property cannot be the subject of a conversion claim “except in cases where an underlying intangible right has been merged into a document and that document has

60 (iii) With regard to the second element of conversion, there is prima facie evidence that Appellants unlawfully and without authorization exercised dominion or control over Stedfast’s bank accounts. It is also undisputed that in September 2021, Appellants exercised dominion or

control over the accounts by taking action to remove Shelley as a signatory, by

replacing him with Bookout, and by subsequently depositing the funds from these

accounts into a new account at North Dallas Bank and Trust for which Bookout was

the sole signatory. Thus, it is undisputed that Appellants exercised dominion or

control over Stedfast’s bank accounts. The issue then is whether Appellees have

presented clear and specific evidence to show that Appellants’ actions were

“unlawful” and “without authorization.” We conclude that they have.

Shelley’s affidavit and Stedfast’s corporate records, including board minutes,

support Appellees’ position that Appellants were not directors of Stedfast at the time

that they changed the signatories on Stedfast’s bank accounts. As this evidence is

sufficient to support a rational inference that Appellants acted unlawfully and without

authorization when they took control of Stedfast’s bank accounts, Appellees have

satisfied their burden under the second step of the TCPA. See Lipsky, 460 S.W.3d at 590.

been converted” (citing Neles–Jamesbury, Inc. v. Bill’s Valves, 974 F. Supp. 979, 982 (S.D. Tex. 1997) (mem. & order))). Appellants’ briefing concerning Appellees’ prima facie case for conversion—which focuses on Appellees’ failure to present evidence that they made a demand for a return of the property or that Appellants refused this demand—does not raise the issue of whether general deposits held by a bank can be the proper subject of a conversion claim. Nor was this issue raised in the trial court. Therefore, for purposes of this interlocutory appeal, we will assume without deciding that the bank accounts in question are the proper subject of a conversion cause of action.

61 (iv) With regard to the third element of conversion, there is prima facie evidence that Appellees suffered injury. Generally, the injury suffered by a conversion plaintiff is the loss of the

converted property; thus, the measure of damages is generally the fair market value of

the property at the time of the conversion. See United Mobile Networks, 939 S.W.2d at

147–48 (“Generally, the measure of damages for conversion is the fair market value of

the property at the time and place of the conversion.”). Here, Appellees have

presented evidence showing that Stedfast’s bank accounts contained almost $140,000

at the time Appellants exercised control over them and that Appellants subsequently

used $40,000 of these funds to pay their attorneys.28 Moreover, Shelley testified

regarding the “extreme harm” that Stedfast suffered as a result of losing its access to

its bank accounts:

It’s disrupted payroll, paying bills, checks. It’s made it where we’re not able to deposit tithes. Our online giving was shut down. It’s caused us to have to seek all kinds of remedies to continue operation as a church. It’s very detrimental to our business operations.

Therefore, we conclude that there is prima facie evidence that Appellees suffered injury.

(v) Appellees were not required to prove that they made a formal demand for the return of the funds. In their briefing, Appellants make much of the fact that Appellees have

presented no evidence that they made a formal demand for the return of the property.

However, demand of return is not always required. See First State Bank, N.A. v. Morse,

28 These funds, including the amounts paid to Appellants’ attorneys, were ultimately deposited into the trial court’s registry.

62 227 S.W.3d 820, 827–28 (Tex. App.—Amarillo 2007, no pet.) (first citing Autry v.

Dearman, 933 S.W.2d 182, 191–92 (Tex. App.—Houston [14th Dist.] 1996, writ

denied); and then citing McVea v. Verkins, 587 S.W.2d 526, 531 (Tex. App.—Corpus

Christi–Edinburg 1979, no writ)); Burns, 190 S.W.3d at 270 n.2 (citing Presley, 284

S.W.2d at 141); Bures v. First Nat’l Bank of Port Lavaca, 806 S.W.2d 935, 938 (Tex.

App.—Corpus Christi–Edinburg 1991, no writ) (first citing McVea, 587 S.W.2d at

531; then citing Loomis v. Sharp, 519 S.W.2d 955, 958 (Tex. App.—Texarkana 1975,

writ dism’d); then citing Neyland v. Brammer, 73 S.W.2d 884, 887 (Tex. App.—

Galveston 1933, writ dism’d); and then citing Presley, 284 S.W.2d at 140–41)).

Specifically, demand and refusal are not required if other evidence establishes the act

of conversion, Burns, 190 S.W.3d at 270 n.2, if the demand would have been useless,

McVea, 587 S.W.2d at 531, or if the defendant’s acts amount to a clear repudiation of

the owner’s rights. Loomis, 519 S.W.2d at 958; Neyland, 73 S.W.2d at 887. Thus, demand

of return is not a required element of a conversion claim. See Truitt, 2021 WL 5742083, at

*5 (listing elements); O’Connor’s Texas Causes of Action ch. 6, § 1.1 (2022) (same).

As the court explained in Burns, the purpose of demand and refusal is to

demonstrate conversion in situations such as bailment where the exercise of

unauthorized dominion or control over property cannot otherwise be shown:

The purpose of demand and refusal is most effectively illustrated in bailment, where “a conversion by the bailee cannot otherwise b[e] shown than by his refusal to comply with the demand for possession.” [Presley, 284 S.W.2d at 141.] Here, [Appellant]’s wrongful seizure of the equipment represented a clear act of conversion. Thus, although the trial

63 court found that demand and refusal did occur, such findings were not strictly necessary for [Appellee] to prevail. 190 S.W.3d at 270 n.2. Thus, when the act of conversion is clear, demand and refusal

are not required. See id.; Bures, 806 S.W.2d at 938.

Here, Appellants’ actions to remove Shelley as a signatory on the accounts and

to replace him with Bookout—thereby denying Appellees access to the funds—

constituted a clear repudiation of Appellees’ rights. Accordingly, demand and refusal

were not required.

f. Conversion Step Three: Affirmative Defenses Having determined that Appellees have established a prima facie case for each

essential element of their conversion claim by clear and specific evidence, we must

now consider whether Appellants have established an affirmative defense that would

entitle them to judgment as a matter of law.

In the trial court, Appellants asserted unclean hands as an affirmative defense

to Appellees’ conversion claim,29 but they have not raised this defense in their

appellate briefing. We therefore consider this defense to have been waived for

purposes of this appeal. See Tex. R. App. P. 38.1(i); Jackson, 546 S.W.3d at 922; City of

Alton, 164 S.W.3d at 870.

29 In their reply in support of their motion to dismiss, Appellants included both unclean hands and laches in the section of their brief labeled “Affirmative Defenses to Conversion,” but their actual argument concerning the laches defense focused solely on Appellees’ declaratory judgment action.

64 Because Appellees have presented prima facie proof of each essential element

of their conversion claim and Appellants have not established an affirmative defense,

the trial court did not err in denying Appellants’ motion to dismiss this cause of action

pursuant to the TCPA. Accordingly, we overrule Appellants’ fifth issue.

g. Declaratory Judgment Step Two: Prima Facie Case

As noted above, having determined that Appellants have satisfied their initial

burden to invoke the TCPA regarding Appellees’ declaratory judgment cause of

action, we must now—as step two of our TCPA analysis—consider whether

Appellees have presented clear and specific evidence establishing a prima facie case

for each essential element of this claim.

(i) There are two essential elements of a declaratory judgment cause of action. The Uniform Declaratory Judgment Act (UDJA) provides that

[a] person interested under a deed, will, written contract, or other writings constituting a contract or whose rights, status, or other legal relations are affected by a statute, municipal ordinance, contract, or franchise may have determined any question of construction or validity arising under the instrument, statute, ordinance, contract or franchise and obtain a declaration of rights, status, or other legal relations thereunder.

Tex. Civ. Prac. & Rem. Code Ann. § 37.004(a). The UDJA “‘is to be liberally

construed and administered.’” Shannon v. Blair, No. 04-21-00257-CV, 2022 WL

4492801, at *3 (Tex. App.—San Antonio Sept. 28, 2022, no pet. h.) (mem. op.)

(quoting Tex. Civ. Prac. & Rem. Code Ann. § 37.002(b)).

65 “There are two prerequisites for a declaratory judgment action: (1) there must

be a real controversy between the parties and (2) the controversy must be one that

will actually be determined by the judicial declaration sought.”30 Nehls v. Hartman

Newspapers, LP, 522 S.W.3d 23, 29 (Tex. App.—Houston [1st Dist.] 2017, pet. denied)

(citing Hous. Chronicle Publ’g Co. v. Thomas, 196 S.W.3d 396, 399 (Tex. App.—Houston

[1st Dist.] 2006, no pet.)); see also Sw. Elec. Power Co. v. Lynch, 595 S.W.3d 678, 685

30 In their briefing, Appellants—based on their own interpretation of the UDJA and without citing any authority—assert that there are three essential elements to a declaratory judgment claim: (1) an actual controversy; (2) a writing; and (3) a valid contract. However, Appellants’ reading of the statute is flawed. The UDJA is not limited to controversies involving written contracts. Indeed, the language of Section 37.004 quoted above makes clear that

[a] person interested under a deed, will, written contract, or other writings constituting a contract or whose rights, status, or other legal relations are affected by a statute . . . may have determined any question of construction or validity arising under the instrument, statute, ordinance, contract or franchise and obtain a declaration of rights, status, or other legal relations thereunder.

Tex. Civ. Prac. & Rem. Code Ann. § 37.004(a) (emphasis added). Appellants’ reading of the statute ignores the language emphasized above. Thus, Appellants were not required to prove the existence of a written contract as part of their prima facie case for declaratory relief. Because Stedfast is incorporated as a nonprofit under the laws of Texas, the rights, status, and legal relations of Appellants and the Shelley Group are affected by Chapter 22 of the Texas Business Organizations Code. Therefore, the controversy that Appellees seek to resolve is the proper subject of a declaratory judgment action. Cf. Lee, 2019 WL 1033869, at *1–3 (affirming declaratory judgment regarding, inter alia, the composition of the board of trustees of a church incorporated as a nonprofit corporation under the Texas Business Organizations Code); Hous. Aeronautical Heritage Soc’y, Inc. v. Graves, No. 01-12-00443-CV, 2013 WL 6506301, at *7–10 (Tex. App.—Houston [1st Dist.] Dec. 10, 2013, no pet.) (mem. op.) (addressing merits of appeal from summary judgment granting declaratory relief regarding validity of corporate bylaws and composition of corporation’s board of directors).

66 (Tex. 2020) (“[A] declaratory judgment is appropriate only if a justiciable controversy

exists as to the rights and status of the parties and the controversy will be resolved by

the declaration sought.” (quoting Bonham State Bank v. Beadle, 907 S.W.2d 465, 467

(Tex. 1995))). “To establish these elements, ‘[a] person seeking a declaratory

judgment need not have incurred actual injury.’” Shannon, 2022 WL 4492801, at *3

(quoting City of San Antonio v. Greater San Antonio Builders Ass’n, No. 04-12-00745-CV,

2013 WL 2247468, at *3 (Tex. App.—San Antonio May 22, 2013, no pet.) (mem. op.)).

(ii) Appellees have established both elements of their declaratory judgment cause of action by clear and specific evidence. As Appellants concede, Appellees have presented evidence that there is a

controversy. Indeed, as has been shown above, the controversy regarding whether

Appellants or the Shelley Group are the duly elected members of Stedfast’s board of

directors is at the heart of this entire lawsuit. Thus, on the record before us, the

existence of a controversy is unquestionable.

Moreover, the judicial declaration sought by Appellees will resolve this

controversy. As set forth in more detail above,31 Appellees seek a declaration that,

among other things, the Shelley Group—not Appellants—are the duly elected and

appointed members of Stedfast’s board and that Shelley is Stedfast’s duly appointed

and ordained pastor. Thus, the declaratory relief sought by Appellees will resolve the

31 See supra Section III.A.3.b.

67 controversy surrounding Stedfast’s leadership and the status of both Appellants and

the Shelley Group.

Further, though not strictly necessary to avoid dismissal under the TCPA, 32

Appellees have presented clear and specific evidence showing that they are entitled to

the declaratory relief sought. This evidence includes affidavit testimony from two of

the three original members of Stedfast’s board as well as documentary evidence

memorializing the original board members’ action to replace themselves with Shelley,

Urbanek, and Edelmann.

Accordingly, viewing—as we must—the pleadings and other evidence under

Section 27.006(a) of the Texas Civil Practice & Remedies Code in the light most

favorable to Appellees, we conclude that they have satisfied their step-two prima facie

burden on both elements of their declaratory judgment claim.

32 See Choudhri v. Lee, No. 01-20-00098-CV, 2020 WL 4689204, at *4 (Tex. App.—Houston [1st Dist.] Aug. 13, 2020, pet. denied) (mem. op.) (affirming denial of TCPA motion based, in part, on conclusion that prima facie case for declaratory judgment claim was established where dispute about the validity and enforceability of the parties’ agreement could be resolved by a declaration construing the agreement in light of the parties’ conduct); Perez v. Quintanilla, No. 13-17-00143-CV, 2018 WL 6219627, at *4 (Tex. App.—Corpus Christi–Edinburg, Nov. 29, 2018, no pet.) (mem. op.) (affirming denial of TCPA motion based, in part, on conclusion that prima facie case for declaratory judgment claim was established where pleadings and evidence reflected a justiciable controversy existed regarding enforceability and scope of the parties’ agreement and the trial court was left to determine whether or not to grant the declaratory relief sought in order to resolve it).

68 h. Declaratory Judgment Step Three: Affirmative Defenses Having determined that Appellees have established a prima facie case for each

essential element of their request for declaratory relief by clear and specific evidence,

we must now consider—as the third and final step in our TCPA analysis—whether

Appellants have established an affirmative defense that would entitle them to

judgment on this claim as a matter of law.

The sole affirmative defense asserted by Appellants in response to Appellees’

declaratory judgment cause of action is laches. “There are two elements to a laches

defense: (1) an unreasonable delay by the party asserting legal or equitable rights, and

(2) a good faith change of position by another to his detriment because of the delay.”

SignAd, Ltd. v. BJZ Invs., LLC, 640 S.W.3d 611, 622 (Tex. App.—Houston [14th Dist.]

2022, pet. denied) (citing City of Fort Worth v. Johnson, 388 S.W.2d 400, 403 (Tex.

1964)). As an affirmative defense, laches must be properly pleaded and proved. Tex.

R. Civ. P. 94; Knesek v. Witte, 754 S.W.2d 814, 816 (Tex. App.—Houston [1st Dist.]

1988, writ denied) (citing Culver v. Pickens, 176 S.W.2d 167, 170 (Tex. 1943)). Laches

generally may be applied only in cases involving an equitable right and may not be

used to resist the enforcement of a purely legal right. Wayne v. A.V.A. Vending, Inc.,

52 S.W.3d 412, 415 (Tex. App.—Corpus Christi–Edinburg 2001, pet. denied); see also

Att’y Gen. of Tex. ex rel. Ford v. Daurbigny, 702 S.W.2d 298, 300 (Tex. App.—Houston

69 [1st Dist.] 1985, no writ) (holding laches is only available against an assertion of

equitable rights, not a claim based on an express statutory duty).

Here, Appellants’ laches defense fails for several reasons. First, Appellants

failed to plead the defense as required by Rule 94—or even to raise it in their motion

to dismiss. See Tex. R. Civ. P. 94; Knesek, 754 S.W.2d at 816. Rather, they raised it for

the first time in their reply in support of the motion. As a result, the defense was

waived, and we need not consider it. See Cont’l Homes of Tex., L.P. v. City of San

Antonio, 275 S.W.3d 9, 15 (Tex. App.—San Antonio 2008, pet. denied) (“Failure to

plead an affirmative defense generally waives it.” (first citing Shoemake v. Fogel, Ltd.,

826 S.W.2d 933, 937 (Tex. 1992); and then citing Komet v. Graves, 40 S.W.3d 596, 602

(Tex. App.—San Antonio 2001, no pet.))); see also Wyly, 502 S.W.3d at 907; Mei-Chiao

Chen Wu, 2013 WL 4084721, at *5; LaRue, 167 S.W.3d at 876. Moreover, because

laches generally may only be applied in cases involving an equitable right, Wayne, 52

S.W.3d at 415, we question its applicability to an action for declaratory relief under the

UDJA, which, “as the Texas Supreme Court observed long ago, ‘is neither legal nor

equitable, but sui generis.’” Craig v. Tejas Promotions, LLC, 550 S.W.3d 287, 298 (Tex.

App.—Austin 2018, pet. denied) (quoting Cobb v. Harrington, 190 S.W.2d 709, 713

(Tex. 1945)).

Even apart from these issues, Appellants’ laches defense fails on the merits.

With respect to the first element, Appellants have not shown that Appellees’ failure to

file documentation with the Texas Secretary of State reflecting the change in the

70 composition of Stedfast’s board constitutes an unreasonable delay in asserting a legal

right in the face of Appellants’ actions. See Wildman v. Patrizi, No. 05-20-00834-CV,

2022 WL 3655242, at *6 (Tex. App.—Dallas Aug. 25, 2022, no pet.) (mem. op.) (“The

defendant must show the plaintiff’s delay was unreasonable in the face of the

defendant’s actions.” (citing Dempsey v. Apache Shores Prop. Owners Ass’n, 737 S.W.2d

589, 596 (Tex. App.—Austin 1987, no pet.))). Shelley has testified that he was

unaware that he was required to file any such documentation with the Secretary of

State. And by all accounts, he exercised control over Stedfast’s affairs without

incident or challenge until Appellants purported to terminate him and removed him as

a signatory on Stedfast’s bank accounts. After Appellants took action to challenge the

Shelley Group’s status as Stedfast’s duly elected board of directors, Appellees

promptly filed a Restated Certificate of Formation for Stedfast naming the members

of the Shelley Group as directors and commenced this lawsuit seeking, among other

things, the declaratory relief at issue. This fact pattern is hardly indicative of a party

sleeping on his rights. See Condom Sense, Inc. v. Alshalabi, 390 S.W.3d 734, 758 (Tex.

App.—Dallas 2012, no pet.) (“A laches defense embodies the principle that ‘equity

aids the vigilant and not those who slumber on their rights.’” (quoting Nat’l Ass’n of

Gov’t Emps. v. City Pub. Serv. Bd. of San Antonio, Tex., 40 F.3d 698, 708 (5th Cir. 1994))).

Further, even if Appellants could show unreasonable delay on the part of

Appellees in asserting a legal right, they have offered no evidence that they changed

their position to their detriment in good faith as a result of such delay. See Caldwell v.

71 Barnes, 975 S.W.2d 535, 538 (Tex. 1998). The only supposed change in position to

which Appellants point in their briefing is that Romero “maintained that she did not

resign as a director.” However, this does not reflect the type of good faith

detrimental change of position that would satisfy the second element of a laches

defense and, in actuality, is not a change of position at all. By maintaining that she did

not resign as a director, all Romero did, in essence, was assert a legal position—one

which, as has been shown, is at the very center of the present lawsuit. If Appellants’

version of events is the correct one, Romero never ceased being a director of Stedfast.

Thus, her position has not changed. Nor have Appellants presented any evidence

showing that Romero’s legal position has been prejudiced in any way by Appellees’

delay in filing documentation with the Texas Secretary of State. See Caldwell, 975

S.W.2d at 539 (citing Culver, 176 S.W.2d at 170–71)); see also Condom Sense, 390 S.W.3d

at 758 (“Courts commonly define laches as ‘an inexcusable delay that results in

prejudice to the defendant.’” (quoting Elvis Presley Enters., Inc. v. Capece, 141 F.3d 188,

205 (5th Cir. 1998))). Thus, Appellants have failed to establish their laches defense.

Because Appellees established each essential element of their declaratory

judgment cause of action by clear and specific evidence and Appellants have not

established an affirmative defense that would entitle them to judgment as a matter of

law, the trial court did not err in denying Appellants’ motion to dismiss this claim

under the TCPA. Accordingly, we overrule Appellants’ sixth issue.

72 i. Appellees’ Attorney’s Fees

In their seventh issue, Appellants assert that the trial court erred in awarding

Appellees attorney’s fees and costs based upon its finding that Appellants’ motion to

dismiss was frivolous or filed solely for the purpose of delay.

If the trial court finds that a motion to dismiss under the TCPA is frivolous or

solely intended to delay, the court may award court costs and reasonable attorney’s

fees to the nonmoving party. Tex. Civ. Prac. & Rem. Code Ann. § 27.009(b). We

review the trial court’s decision to award attorney’s fees under the TCPA for an abuse

of discretion. Caliber Oil & Gas, LLC v. Midland Visions 2000, 591 S.W.3d 226, 242

(Tex. App.—Eastland 2019, no pet.); Sullivan v. Tex. Ethics Comm’n, 551 S.W.3d 848,

857 (Tex. App.—Austin 2018, pet. denied). A trial court abuses its discretion when it

acts arbitrarily or unreasonably or without regard to guiding principles. Caliber, 591

S.W.3d at 242–43; Sullivan, 551 S.W.3d at 857; see also Downer v. Aquamarine Operators,

Inc., 701 S.W.2d 238, 241–42 (Tex. 1985).

The TCPA does not define “frivolous.” Caliber, 591 S.W.3d at 243; Sullivan,

551 S.W.3d at 857. However, courts that have addressed this issue have noted that

the “common understanding” of the word “contemplates that a claim or motion will

be considered frivolous if it has no basis in law or fact and lacks a legal basis or legal

merit.” Sullivan, 551 S.W.3d at 857; see Caliber, 591 S.W.3d at 243 (following Sullivan);

Pinghua Lei v. Nat. Polymer Int’l Corp., 578 S.W.3d 706, 717 (Tex. App.—Dallas 2019,

no pet.) (same). “The fact that a TCPA motion to dismiss is ultimately denied is not

73 sufficient, standing alone, to support a finding that the motion was frivolous.” Keane

Frac, LP v. SP Silica Sales, LLC, 608 S.W.3d 416, 433 (Tex. App.—Houston [1st Dist.]

2020, no pet.) (citing Caliber, 591 S.W.3d at 244).

Appellants argue that the trial court erred in awarding Appellees attorney’s fees

because at least one of Appellees’ claims falls within the scope of the TCPA.33

According to Appellants, though the trial court did not issue findings of fact or

conclusions of law, it must have implicitly ruled that none of Appellees’ claims fell

within the scope of the TCPA given its determination that Appellants’ motion to

dismiss was frivolous or filed solely for purposes of delay. However, this is not

necessarily the case. The question of whether a motion to dismiss is frivolous or filed

solely for purposes of delay does not begin and end with the first step of the TCPA

analysis. If, prior to filing its motion to dismiss under the TCPA, a defendant was

aware of clear and specific evidence with which the plaintiff could meet its burden to

establish a prima facie case on each essential element of its claims, then the motion to

dismiss could still be frivolous even though the plaintiff’s claims fall under the

auspices of the TCPA. See Pinghua Lei, 578 S.W.3d at 717–18; see also Mosaic Baybrook

One LP v. Cessor, No. 14-19-00514-CV, 2021 WL 2656613, at *11 (Tex. App.—

Houston [14th Dist.] June 29, 2021, pet. dism’d) (mem. op.) (agreeing that “even if

the broad definitions of the TCPA technically apply to a claim, a TCPA motion to

33 As set forth above, we have concluded that, in fact, all three of Appellees’ claims fall within the scope of the TCPA. See supra Sections III.B.3.b., d.

74 dismiss can still be frivolous as to the merits of the plaintiffs’ claims”). Thus, the

mere fact that Appellants could satisfy their burden under the first step of the TCPA

analysis with respect to one—or even all—of Appellees’ claims does not, in and of

itself, require a reversal of the trial court’s award of attorney’s fees to Appellees.

Based on the record before us, we cannot say that the trial court abused its

discretion in awarding attorney’s fees to Appellees. At the time that Appellants filed

their TCPA motion, the trial court had already conducted two evidentiary hearings—

one on Appellees’ motion for temporary injunction and one on their motion to hold

Chase Bank in contempt—and Appellees had presented a great deal of evidence

supporting their declaratory judgment and conversion claims. Moreover, Appellees’

first amended petition specifically references Bookout’s social media posts, including a

specific video posted by Bookout, as a basis for Appellees’ defamation claim. Given

that these videos and social media posts were created by one of the Appellants, they

were within the possession or control of Appellants, and the content was well known

to them. Accordingly, they should have been aware of the evidence Appellees could

marshal to establish a prima facie case of defamation. Thus, we cannot say that the

trial court abused its discretion in finding Appellants’ TCPA motion to be frivolous.

See Pinghua Lei, 578 S.W.3d at 717–18.

Even if Appellants could show that their motion to dismiss was not frivolous,

in order to prevail on their seventh issue, they must also show that the trial court

erred in finding that their motion to dismiss was filed for the sole purpose of delay.

75 See Sullivan, 551 S.W.3d at 857. As Appellees point out, the record reflects that at the

time the motion to dismiss was filed, Appellees were engaged in ongoing efforts to

discover the whereabouts of and gain access to the funds Appellants had removed

from Stedfast’s bank accounts, which ultimately led to the filing of a motion to hold

Appellants in contempt. As a motion to dismiss under the TCPA automatically

suspends all discovery, 34 the trial court, given its familiarity with the parties and the

goings on in the case, could have viewed Appellants’ TCPA motion as a tactical

maneuver designed to stonewall Appellees’ efforts. Mindful that the trial court has a

unique vantage point in overseeing this internecine conflict and is in the best position

to evaluate circumstances which may not be readily apparent from a cold record, we

cannot say that the trial court abused its discretion in finding that Appellants’ TCPA

motion was filed solely for purposes of delay. See In re R.E.S., 482 S.W.3d 584, 587

(Tex. App.—San Antonio 2015, no pet.) (acknowledging “the principle that the trial

court is in the best position to evaluate circumstances which may not be readily

apparent from a cold record” in affirming trial court’s award of attorney’s fees in a

case arising from a petition to modify the parent–child relationship established by a

divorce decree); In re A.L.E., 279 S.W.3d 424, 427 (Tex. App.—Houston [14th Dist.]

2009, no pet.) (“We remain mindful that the trial judge is best able to observe and

assess the witnesses’ demeanor and credibility, and to sense the ‘forces, powers, and

34 Tex. Civ. Prac. & Rem. Code Ann. § 27.003(c).

76 influences’ that may not be apparent from merely reading the record on appeal.”

(quoting Niskar v. Niskar, 136 S.W.3d 749, 753 (Tex. App.—Dallas 2004, no pet.))).

We overrule Appellants’ seventh issue.

IV. Conclusion

Having sustained in part and overruled in part Appellants’ first issue, we hold

that the trial court may exercise subject matter jurisdiction over Appellees’ claims;

provided, however, that the following statements upon which Appellees base their

defamation claim are not actionable under the ecclesiastical abstention doctrine:

(1) any of Bookout’s statements referring to Stedfast as a “cult” or to Shelley as a

“cult leader” and (2) any of Bookout’s statements referring to Shelley as a “sodomite”

or similar statements by Bookout that according to Shelley “suggest that [Shelley]

engage[s] in sexual activities that are condemned by the doctrines of [his] [c]hurch.”35

Having overruled Appellants’ remaining issues, 36 we affirm the trial court’s

order denying Appellants’ motion to dismiss.

/s/ Dabney Bassel

Dabney Bassel Justice

Delivered: November 23, 2022

35 See supra note 10. 36 As previously noted, because we were required to determine whether the TCPA applied to each of Appellees’ claims in order to resolve Appellants’ fourth, fifth, and sixth issues, we do not separately address Appellants’ second issue. See supra note 6.