USA Today A/K/A Gannett Co., Inc., Gannett Publishing Services, LLC, and Gannett Satellite Information Network, LLC v. Ryan, LLC
This text of USA Today A/K/A Gannett Co., Inc., Gannett Publishing Services, LLC, and Gannett Satellite Information Network, LLC v. Ryan, LLC (USA Today A/K/A Gannett Co., Inc., Gannett Publishing Services, LLC, and Gannett Satellite Information Network, LLC v. Ryan, LLC) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.
Opinion
In The
Court of Appeals
Ninth District of Texas at Beaumont
__________________
NO. 09-22-00432-CV __________________
USA TODAY A/K/A GANNETT CO., INC., GANNETT PUBLISHING SERVICES, LLC, AND GANNETT SATELLITE INFORMATION NETWORK, LLC, Appellants
V.
RYAN, LLC, Appellee
__________________________________________________________________
On Appeal from the 284th District Court Montgomery County, Texas Trial Cause No. 22-06-07554-CV __________________________________________________________________
MEMORANDUM OPINION
In this accelerated interlocutory appeal, Appellants USA Today a/k/a Gannett
Company, Inc., Gannett Publishing Services, LLC, and Gannett Satellite
Information Network, LLC (collectively “USA Today,” “Appellants,” or
“Defendants”) appeal the trial court’s order denying their Texas Citizen’s
Participation Act (“TCPA”) motion to dismiss a claim for defamation filed by
Appellee Ryan, LLC (“Ryan,” “Appellee,” or “Plaintiff”). See Tex. Civ. Prac. &
1 Rem. Code Ann. §§ 27.001-27.011 (the TCPA), 51.014(a)(12) (authorizing an
interlocutory appeal of an order denying a motion to dismiss filed under the TCPA
section 27.003). 1 As explained below, we affirm.
Background
This dispute concerns articles that USA Today published in print and in other
media that Ryan alleges “falsely accused Ryan [] of unlawful and unethical business
practices in its efforts to secure legitimate tax savings for its clients.” Ryan is a
Texas-based tax services provider. The USA Today Defendants are companies
engaged in the news media business, including the ownership and publication of a
national newspaper, USA Today, and various local newspapers, including The
Arizona Republic. We have previously described the parties and this litigation in two
other matters challenging trial court rulings, one an interlocutory appeal pertaining
to personal jurisdiction as to certain claims and the other a mandamus regarding
venue. See USA Today v. Ryan, LLC, No. 09-22-00322-CV, 2023 Tex. App. LEXIS
9361 (Tex. App.—Beaumont Dec. 14. 2023, pet. filed) (mem. op.) (finding no
specific personal jurisdiction over USA Today as to Ryan’s breach of contract
claim); In re USA Today, No. 09-23-00140-CV, 2023 Tex. App. LEXIS 7963 (Tex.
1 The TCPA applies to “a legal action [that] is based on or is in response to a party’s exercise of the right of free speech, right to petition, or right of association or arises from any act of that party in furtherance of the party’s communication or conduct described by Section 27.010(b)[.]” Tex. Civ. Prac. & Rem. Code Ann. § 27.003(a). 2 App.—Beaumont Oct. 19, 2023, orig. proceeding) (mem. op.) (finding that when a
limited liability company sues for defamation, the county in which the plaintiff
resided at the time of the accrual of the cause of action is the county where the limited
liability company maintains its principal office, and because the plaintiff did not file
its suit for defamation in a county of proper venue, the court conditionally granted
mandamus relief).
Ryan’s Petition
In June of 2022, Ryan filed its Original Petition against Defendants, and in
August of 2022, Ryan filed its First Amended Petition.2 Ryan asserted several claims
against Defendants, however, the only claim at issue in this interlocutory appeal is
Ryan’s defamation claim.
In its petition, Ryan states that USA Today contracted for Ryan’s services,
obtained more than $2 million in tax savings, and failed to pay fees owed to Ryan.
Then USA published articles that criticized Ryan and described its work as unlawful
and “hid the fact” that USA Today had been a client of Ryan’s. According to the
petition, the articles “falsely claimed that Ryan [] was somehow participating in
2 Ryan’s First Amended Petition was the live pleading at the time the trial court heard USA Today’s motion to dismiss, and we refer to it as “the petition” herein. In this opinion, we limit our discussion of the factual allegations to the defamation claim because that is the claim at issue in the TCPA motion to dismiss. 3 business practices that were criminal, corrupt and unethical[]” while concealing or
not disclosing the fact that USA Today was a client of Ryan’s.
According to Ryan, USA Today published defamatory “articles, podcasts,
tweets and other false communications about Ryan” across the United States and to
a “global internet audience[,]” and the publications contain “demonstrably false
assertions of fact or create[] a defamatory impression by misrepresenting material
facts, omitting material facts, and juxtaposing facts in a misleading way.” Ryan
alleged that some of the allegedly defamatory communications pertained to Ryan’s
work on behalf of a client to seek a tax refund for dyed diesel fuel that was used in
mining and processing machinery in Arizona.
The petition states that dyed diesel fuel is used by Ryan’s client, Carter Oil
Company, as fuel in mining and processing machinery. According to the petition,
after doing research, Ryan concluded that the dyed diesel fuel sold by his client to
others who incorporated the fuel into the machinery used in mining operations
should be exempt from taxation under Arizona statutory law, and Ryan assisted its
client, Carter Oil Company, in applying for a refund, but Arizona’s Department of
Revenue denied the request for a refund in 2014. Ryan’s client, Carter Oil Company,
subsequently sued the department in Tax Court in 2016 and won. After winning on
the issue and entering into a payment plan for receiving refund payments over a
4 period of years, Ryan retained three former state employees as outside consultants
to work for Ryan.
According to the petition, USA Today falsely misrepresented Ryan’s work on
the Arizona dyed diesel fuel issue: (1) by falsely suggesting that Ryan’s work was
done in secret; (2) by falsely suggesting that Ryan asked the refund payments to be
made over a period of years in order to avoid the scrutiny of lawmakers; (3) by
falsely suggesting that there was no basis for Ryan’s request for the refunds and that
the request was contrary to longstanding law; (4) by not reporting (or “concealing”)
that Ryan had prevailed in Tax Court on its refund request; (5) by misleading readers
into thinking that the Governor had fired Woodruff and Nülle for opposing Ryan’s
refund request rather than for opposing the Governor’s position on school funding;
(6) by falsely accusing Ryan of breaking Arizona’s conflict of interest law by hiring
consultants who previously worked for Governor Ducey (Mike Liburdi, Danny
Seiden, and Kirk Adams), although those individuals had never worked in the
Department of Revenue and were never previously involved in the refund request
matter, and the conflict of interest law applies only to individuals and not to
companies like Ryan; and (7) by falsely claiming there was an FBI investigation of
Ryan by the “public corruption unit.” The petition further alleges that USA Today
5 also “falsely accuse[d] Ryan of corruption and unethical business practices” by
misrepresenting Ryan’s work in a separate matter in North Dakota. 3
The petition alleges that USA Today falsely misrepresented Ryan’s work on
the North Dakota equipment refund issue: (1) by falsely claiming that Ryan had filed
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In The
Court of Appeals
Ninth District of Texas at Beaumont
__________________
NO. 09-22-00432-CV __________________
USA TODAY A/K/A GANNETT CO., INC., GANNETT PUBLISHING SERVICES, LLC, AND GANNETT SATELLITE INFORMATION NETWORK, LLC, Appellants
V.
RYAN, LLC, Appellee
__________________________________________________________________
On Appeal from the 284th District Court Montgomery County, Texas Trial Cause No. 22-06-07554-CV __________________________________________________________________
MEMORANDUM OPINION
In this accelerated interlocutory appeal, Appellants USA Today a/k/a Gannett
Company, Inc., Gannett Publishing Services, LLC, and Gannett Satellite
Information Network, LLC (collectively “USA Today,” “Appellants,” or
“Defendants”) appeal the trial court’s order denying their Texas Citizen’s
Participation Act (“TCPA”) motion to dismiss a claim for defamation filed by
Appellee Ryan, LLC (“Ryan,” “Appellee,” or “Plaintiff”). See Tex. Civ. Prac. &
1 Rem. Code Ann. §§ 27.001-27.011 (the TCPA), 51.014(a)(12) (authorizing an
interlocutory appeal of an order denying a motion to dismiss filed under the TCPA
section 27.003). 1 As explained below, we affirm.
Background
This dispute concerns articles that USA Today published in print and in other
media that Ryan alleges “falsely accused Ryan [] of unlawful and unethical business
practices in its efforts to secure legitimate tax savings for its clients.” Ryan is a
Texas-based tax services provider. The USA Today Defendants are companies
engaged in the news media business, including the ownership and publication of a
national newspaper, USA Today, and various local newspapers, including The
Arizona Republic. We have previously described the parties and this litigation in two
other matters challenging trial court rulings, one an interlocutory appeal pertaining
to personal jurisdiction as to certain claims and the other a mandamus regarding
venue. See USA Today v. Ryan, LLC, No. 09-22-00322-CV, 2023 Tex. App. LEXIS
9361 (Tex. App.—Beaumont Dec. 14. 2023, pet. filed) (mem. op.) (finding no
specific personal jurisdiction over USA Today as to Ryan’s breach of contract
claim); In re USA Today, No. 09-23-00140-CV, 2023 Tex. App. LEXIS 7963 (Tex.
1 The TCPA applies to “a legal action [that] is based on or is in response to a party’s exercise of the right of free speech, right to petition, or right of association or arises from any act of that party in furtherance of the party’s communication or conduct described by Section 27.010(b)[.]” Tex. Civ. Prac. & Rem. Code Ann. § 27.003(a). 2 App.—Beaumont Oct. 19, 2023, orig. proceeding) (mem. op.) (finding that when a
limited liability company sues for defamation, the county in which the plaintiff
resided at the time of the accrual of the cause of action is the county where the limited
liability company maintains its principal office, and because the plaintiff did not file
its suit for defamation in a county of proper venue, the court conditionally granted
mandamus relief).
Ryan’s Petition
In June of 2022, Ryan filed its Original Petition against Defendants, and in
August of 2022, Ryan filed its First Amended Petition.2 Ryan asserted several claims
against Defendants, however, the only claim at issue in this interlocutory appeal is
Ryan’s defamation claim.
In its petition, Ryan states that USA Today contracted for Ryan’s services,
obtained more than $2 million in tax savings, and failed to pay fees owed to Ryan.
Then USA published articles that criticized Ryan and described its work as unlawful
and “hid the fact” that USA Today had been a client of Ryan’s. According to the
petition, the articles “falsely claimed that Ryan [] was somehow participating in
2 Ryan’s First Amended Petition was the live pleading at the time the trial court heard USA Today’s motion to dismiss, and we refer to it as “the petition” herein. In this opinion, we limit our discussion of the factual allegations to the defamation claim because that is the claim at issue in the TCPA motion to dismiss. 3 business practices that were criminal, corrupt and unethical[]” while concealing or
not disclosing the fact that USA Today was a client of Ryan’s.
According to Ryan, USA Today published defamatory “articles, podcasts,
tweets and other false communications about Ryan” across the United States and to
a “global internet audience[,]” and the publications contain “demonstrably false
assertions of fact or create[] a defamatory impression by misrepresenting material
facts, omitting material facts, and juxtaposing facts in a misleading way.” Ryan
alleged that some of the allegedly defamatory communications pertained to Ryan’s
work on behalf of a client to seek a tax refund for dyed diesel fuel that was used in
mining and processing machinery in Arizona.
The petition states that dyed diesel fuel is used by Ryan’s client, Carter Oil
Company, as fuel in mining and processing machinery. According to the petition,
after doing research, Ryan concluded that the dyed diesel fuel sold by his client to
others who incorporated the fuel into the machinery used in mining operations
should be exempt from taxation under Arizona statutory law, and Ryan assisted its
client, Carter Oil Company, in applying for a refund, but Arizona’s Department of
Revenue denied the request for a refund in 2014. Ryan’s client, Carter Oil Company,
subsequently sued the department in Tax Court in 2016 and won. After winning on
the issue and entering into a payment plan for receiving refund payments over a
4 period of years, Ryan retained three former state employees as outside consultants
to work for Ryan.
According to the petition, USA Today falsely misrepresented Ryan’s work on
the Arizona dyed diesel fuel issue: (1) by falsely suggesting that Ryan’s work was
done in secret; (2) by falsely suggesting that Ryan asked the refund payments to be
made over a period of years in order to avoid the scrutiny of lawmakers; (3) by
falsely suggesting that there was no basis for Ryan’s request for the refunds and that
the request was contrary to longstanding law; (4) by not reporting (or “concealing”)
that Ryan had prevailed in Tax Court on its refund request; (5) by misleading readers
into thinking that the Governor had fired Woodruff and Nülle for opposing Ryan’s
refund request rather than for opposing the Governor’s position on school funding;
(6) by falsely accusing Ryan of breaking Arizona’s conflict of interest law by hiring
consultants who previously worked for Governor Ducey (Mike Liburdi, Danny
Seiden, and Kirk Adams), although those individuals had never worked in the
Department of Revenue and were never previously involved in the refund request
matter, and the conflict of interest law applies only to individuals and not to
companies like Ryan; and (7) by falsely claiming there was an FBI investigation of
Ryan by the “public corruption unit.” The petition further alleges that USA Today
5 also “falsely accuse[d] Ryan of corruption and unethical business practices” by
misrepresenting Ryan’s work in a separate matter in North Dakota. 3
The petition alleges that USA Today falsely misrepresented Ryan’s work on
the North Dakota equipment refund issue: (1) by falsely claiming that Ryan had filed
“questionable” and “frivolous” refund claims that lacked documentation even
though the Tax Court’s ruling in favor of Ryan’s client was publicly available when
USA Today published its article; (2) by falsely claiming that Ryan had “issue
shopped” various North Dakota tax department employees to obtain inconsistent or
ambiguous responses even though a North Dakota senior tax official had apologized
to Ryan after an official had mistakenly blamed Ryan for another company’s “issue
shopping” and the apology had occurred before USA Today’s misleading article;
and (3) by failing to correct the record when Ryan notified USA Today of the alleged
errors.
3 According to an order in the appellate record, the North Dakota suit related to a request by Ryan’s client Equinor Energy LP (f/k/a Statoil Oil and Gas LP) seeking a refund of sales and use tax on separators it purchased for use in gas gathering and processing. The petition alleges that Ryan believed that its client was entitled to a tax refund because separators used in gas gathering and gas compression systems should have been exempt from North Dakota sales and use tax. Initially the tax commissioner denied Equinor’s refund request, after which the Tax Court ruled in favor of Ryan’s client, Equinor, and in a publicly-issued ruling the Tax Court concluded that it was the tax commissioner’s position which was not supported by law and that Ryan’s client was entitled to the refund. 6 The petition asserts that the alleged defamatory statements or publications are
defamatory individually and as a whole because they “create a defamatory
impression by misrepresenting material facts, omitting material facts, and
juxtaposing facts in a misleading way[,]” and a person of ordinary intelligence would
perceive USA Today to be “accusing Ryan of serious criminal misconduct,
corruption, and unethical business practices.” Ryan identified nine statements that
USA published that were allegedly defamatory communications about Ryan:
a) A July 14, 2021 series by Craig Harris, Michael Braga, and Javier Zarracina, “Untangling Arizona Gov. Ducey’s complex network of interests,” which was published on usatoday.com and in print editions of USA Today, states that:
“Here’s a map of the main players involved in this failed behind the scenes power play and what each had at stake:”
“The entire basis for Ryan’s [dyed diesel refund] claim was novel.”
“But in mid-2016, the tax officials had rejected the whole idea of the [dyed diesel] tax break. So Ryan LLC and its founder, G. Brint Ryan, had an Arizona problem. To turn that problem into a big win, they would need to beat the state Revenue Department. And they would need the help of one of the most powerful men in Arizona . . .”
7 Ryan “needed the governor’s help persuading the Department of Revenue to abandon [the dyed diesel] legal action . . . and to [issue the] refund.”
“. . . changing the rules to issue [the dyed diesel refund] was . . . contrary to long-standing tax law.”
“Nülle knew that state conflict-of-interest laws bar government employees from trying to influence their former employers for a year. Yet, here Liburdi and Seiden were representing the interests of [Ryan] before a state agency that they used to oversee.”
During settlement negotiations, Ryan requested the “payment of many millions of dollars over three years, rather than all at once, Nulle told The Republic. Doing it this way, as Ryan wanted, would avoid scrutiny from lawmakers or from the independent Joint Legislative Budget Committee, which likely would raise questions as to why such a large lump sum was flowing out of Revenue’s coffers,” Nulle said.
b) A July 19, 2021 promotional tweet posted by USA Today employee Craig Harris to his official USA Today Twitter account @CraigHarrisUSAT states:
“ICYMI: These two veteran public servants stopped a $100 million tax giveaway to @GBrintRyan, a campaign donor to Gov. @dougducey. Their reward? @dougducey fired them.”
c) On July 28, 2021, Craig Harris appeared as an employee of USA Today on the Gaggle podcast, which is widely available online and through podcasting apps, and made the following statements:
Ryan pushed for the dyed diesel fuel refund request with “no public hearings, no openness at all, trying to get the department of revenue to sign over a hundred million dollars to all of these clients for Ryan LLC.”
Ryan retained three former public officials even though “they’re supposed to wait a year, according to the state’s conflict of interest laws and a cooling off period laws.” 8 d) An August 31, 2021 article by Craig Harris, “FBI examining $100M tax refund push by Arizona Gov. Ducey staffers after Arizona Republic/USA Today investigation,” which was published on usatoday.com and in print copies of USA Today, stated that:
“The FBI’s Public Corruption unit is investigating efforts by Arizona Gov. Doug Ducey’s past and current staffers—including one who is now a federal judge—to push for a closed-door deal to issue tax refunds worth as much as $100 million to aid one of Ducey’s campaign supporters . . . The companies that stood to benefit were represented by Texas tax firm Ryan LLC, founded by Ducey supporter G. Brint Ryan. The top three deputies in Ducey’s administration left their government jobs and went to work for Ryan to push for the tax refund.”
“Ryan had pushed Revenue to settle the [dyed diesel fuel refund request] case and pay out the money, perhaps spread out over multiple years to draw less scrutiny.”
“Ryan’s firm hired ex-Chief of Staff Kirk Adams, now a political consultant; ex-General Counsel Mike Liburdi, now a federal judge appointed by Trump; and former Deputy Chief of Staff Danny Seiden, now CEO of the Arizona Chamber of Commerce & Industry. All began working for Ryan within months of leaving Ducey’s office despite a state law that requires a one- year cooling-off period for public employees before trying to influence their former employers.”
e) The following August 31, 2021 promotional tweets posted by USA Today employee Craig Harris to his official USA Today Twitter account @CraigHarrisUSAT:
“EXCLUSIVE: @FBI Public Corruption Unit investigating Gov. @dougducey administration after current and former staff, including a federal judge, pressured AZDOR to give away $100M to clients of @GBrintRyan, a big-time @GOP and @dougducey donor.”
9 “Here’s the story on the background of Nülle and his former boss Carlton Woodruff, both of whom @dougducey fired after they were against the $100 million tax giveaway.”
f) On September 1, 2021, Craig Harris appeared as an employee of USA Today on the Arizona Horizon podcast, which is widely available online and through podcasting apps, and made the following statements:
“Ryan LLC hired three high-level staffers of the Governor. . . and within months of leaving the Governor’s office they were lobbying and putting pressure on the Department of Revenue, an agency that they managed and overseen to give this $100 million sales tax refund back to these businesses here in Arizona.”
“There wasn’t any” basis for Ryan’s dyed diesel refund request.
g) A December 30, 2021 promotional tweet posted by USA Today employee Craig Harris to his official USA Today Twitter account @CraigHarrisUSAT, stated:
USA Today’s July series “showed a coordinated effort by the @dougducey administration to try to secretly give away $100 million in tax refunds to donors and friends of the governor? https://azcentral.com/in-depth/news/local/ arizona-investigations/2021/07/14/how-doug-ducey-top- deputies-pushed-deal-would-have-cost-arizona-taxpayers-100- million/7622030002/.”
h) A January 10, 2022 article by Craig Harris, “Firm helps companies get rich with ‘questionable’ tax refunds, tactics that exhaust officials,” which was published on usatoday.com and in print copies of USA Today on January 12, 2022 under the headline “Tax officials question firm’s grueling tactics,” stated that:
Ryan retained people who were “supposed to wait a year, according to the state’s conflict of interest laws and a cooling off period law.”
10 Ryan pushed for the dyed diesel request in Arizona “behind the scenes,” “not in the public,” and “with no public hearings or openness at all.”
Ryan “Hired three former high-ranking officials in Arizona Gov. Doug Ducey’s administration a few months after they left office to pressure the state’s department of revenue to give $100 million in refunds to mining clients of Ryan. The company hired the three ex-public employees, including one whom Trump appointed as a federal judge after working for Ryan, even though Arizona has a one-year cooling-off period before ex-employees can lobby the state . . . The controversy resulted in an FBI investigation last spring.”
“Ryan LLC unsuccessfully ‘issue shopped’ by contacting different tax department employees in an attempt to find an inconsistent or ambiguous answer to their questions.”
Ryan files “questionable refund claims” . . . “For example, McMerty said Ryan tried to claim that oil well production equipment should receive an exemption for gas equipment, which is intended to incentivize the buildout of gas transportation infrastructure. McMerty said the equipment is used in oil production, separating oil, water and gas—not gas processing.”
i) The following January 10, 2022 promotional tweets posted by USA Today employee Craig Harris to his official USA Today Twitter account @CraigHarrisUSAT:
“If this firm, Ryan LLC, sounds familiar, well it tried to quietly claw back $100 million in tax refunds in Arizona through the help of Gov. @dougducey and current and ex-staffers like @dbseiden, @KirkAdams and current federal judge Mike Liburdi.”
“. . . Gov. @dougducey tried to help the firm [Ryan] quietly claw back $100 million of Arizona tax dollars to help friends of the governor. #AZUnstoppable.”
11 “And when two public servants at the Arizona Dept. of Revenue tried to stand up to @dougducey and stop the $100 million in tax refunds to clients of [Ryan] they got fired.”
Ryan alleged that USA Today’s allegedly false accusations—which were also
republished by other media outlets and by USA Today itself—caused Ryan to suffer
substantial financial and reputational harm. According to Ryan, it has lost current
and prospective customers due to the complained-of publications, its employee
recruiting has been adversely affected, and it has made significant expenditures to
mitigate business and reputational harm. Ryan also alleged it had suffered
consequential damages in the form of lost profits.
Attached to the petition were copies of the following documents: a September
1, 2021 Arizona Horizon article titled “The FBI is investigating Governor Doug
Ducey and staff members regarding a major tax refund”; July 14, 2021 The Arizona
Republic and USA Today articles titled “Untangling Arizona Gov. Doug Ducey’s
complex network of interests[,]” “He made a fortune winning tax refunds. He needed
help from Arizona’s most powerful leader[,]” “Arizona’s governor had political
aspirations. He also had a pipeline to a big GOP supporter[,]” “They were Gov. Doug
Ducey’s top officials. Then they went after a huge tax refund[,]” “She was the
governor’s deputy chief of staff. The tax deal she pushed would benefit her father’s
12 mining firm[,]”4 and “They stood up against a tax refund that would have cost
Arizonans. It cost them their jobs[,]”; a January 10, 2022 USA Today article titled
“Firm helps companies get rich with ‘questionable’ tax refunds, tactics that exhaust
officials”; a November 2, 2021 letter from counsel for Ryan to counsel for USA
Today outlining and objecting to “false accusations of corruption and deceit [that]
are defamatory per se” and demanding a correction and public apology; a January
28, 2022 letter from counsel for Ryan to counsel for USA Today outlining and
objecting to additional false and libelous claims and demanding a retraction; and an
August 31, 2021 The Arizona Republic and USA Today article titled “FBI examining
$100M tax refund push by Arizona Gov. Ducey staffers after Arizona Republic/USA
TODAY investigation[.]”5
USA Today’s Answer
Defendants filed an Original Answer Subject to Special Appearance and
Motion to Transfer Venue, which asserted a general denial. Defendants also asserted
affirmative defenses, including—they did not publish any false statements about
Ryan, and any statements at issue are true or substantially true; the statements at
4 This article refers to Gretchen Conger, former deputy chief of staff to Governor Ducey, whose father was an executive of Freeport McMoRan, an international mining firm. 5 Other documents were attached in support of Ryan’s contract claim, which we do not review here because they are not related to the denial of USA Today’s TCPA motion to dismiss, which is the subject of this appeal. See Tex. R. App. P. 47.1. 13 issue are privileged; the statements at issue were made without malice, which Ryan
must prove because Ryan is a public figure; the statements at issue are expressions
of opinion that are not actionable in defamation.
USA Today’s Motion to Dismiss Plaintiff’s Defamation Claims
USA Today filed a motion to dismiss pursuant to the TCPA, arguing that
Ryan’s defamation claims should be dismissed because (1) the alleged defamatory
statements are based on or are in response to USA Today’s exercise of the right of
free speech, (2) Ryan cannot establish by clear and specific evidence a prima facie
case for its defamation claims, (3) or in the alternative, USA Today has the
affirmative defenses of (a) the statements at issue are true or substantially true,
(b) the statements at issue are “fair, true and impartial accounts of judicial, executive,
or other official proceedings to administer the law[,]” (c) the statements at issue are
constitutionally protected opinion, and (d) the statements at issue are privileged
commentary on acts of public officials and matters of public concern. 6
USA Today contends that Ryan cannot prove that USA Today made
defamatory statements of fact because Ryan’s pleading relies on misrepresentations
of the statements at issue, taken out of context. USA Today argues that the
Defendants never accused Ryan of illegal or unethical conduct and only reported
6 Citing Tex. Civ. Prac. & Rem. Code Ann. §§ 27.005(b)-(d), 73.002(b)(1), (2), 73.005(a)-(b). 14 about what other people said who questioned Ryan’s “tactics and the work of its
lobbyists[,]” and that several of the statements at issue are not about Ryan at all—
rather they are about Governor Ducey or his former staffers. The motion also argues
that the statutory “fair reporting” privilege protects the media’s accurate reporting,
and that Ryan must show that USA Today falsely reported its sources’ allegations,
which Ryan cannot do. 7
In its motion to dismiss, USA Today did not take a position on whether Ryan
is a public figure for purposes of determining the degree of fault required (actual
malice or ordinary negligence). USA requests attorney’s fees and sanctions against
Ryan. Attached to USA Today’s motion is the Declaration of Craig Harris, a
journalist for USA Today and formerly for The Arizona Republic. 8 Attached to the
Declaration are copies of several articles, tweets, and a transcript of Harris’s
comments on “The Gaggle” podcast. In his Declaration, Harris attests that “[a]ll of
the statements attributed to Woodruff, Nülle, and all other third parties in the
publications cited [] are accurately reported.”
7 Citing Tex. Civ. Prac. & Rem. Code Ann. § 73.005(b) (In an action brought against a newspaper, the defense of truth applies to “an accurate reporting of allegations made by a third party regarding a matter of public concern.”). 8 USA Today’s motion explains that it publishes The Arizona Republic, which it describes as “the state’s largest newspaper.” 15 Ryan’s Response in Opposition to Defendants’ Motion to Dismiss Plaintiff’s Defamation Claims
In its Response, Ryan argued, “[a]t the heart of [USA Today’s] false reporting
is the false implication that Ryan’s core commitment—to ensuring that its clients
pay only the taxes they owe, and not a penny more—is somehow improper, unlawful
or contrary to the public interest[]” and that in pursuing tax savings for its clients,
Ryan was “somehow participating in business practices that were criminal, corrupt
and unethical.” Ryan argues that the gist of USA Today’s reporting about Ryan is
defamatory. According to Ryan, the nine statements at issue are either false standing
alone, or when viewed together, create “a substantially false and defamatory
impression of Ryan[.]”
Ryan contends that it is not a public figure, and the negligence standard of
fault should apply. That said, according to Ryan, even under the actual malice
standard, Ryan has presented prima facie proof of its claim because USA Today’s
“selective omission of facts, or juxtaposition of true facts in certain contexts, was
designed to create a false impression about the nature of Ryan’s business activities,
caused harm to Ryan’s reputation[,] and implied Ryan engaged in criminal
misconduct.” Ryan argues that because it has offered clear and specific evidence of
a prima facie claim for defamation, the burden shifted to USA Today on its
affirmative defenses, and that numerous of the statements at issue were not attributed
to third persons, so they are not shielded by the third-party allegations privilege. In 16 addition, Ryan argues that the statements made on podcasts are slander under Texas
law and are not covered by the affirmative defenses USA Today asserts. Ryan further
argues that USA Today has not met its burden to prove that it is entitled to judgment
as a matter of law on its affirmative defenses.
According to Ryan, USA Today knew or should have known its reporting on
the Arizona dyed diesel fuel refund was false because: (1) Ryan’s clients publicly
sued the Department of Revenue in Tax Court and not “behind the scenes” as
reported; (2) the initial proposal to make the refund payments over three years was
initially offered to Ryan’s client by the Department of Revenue and not by Ryan, as
USA Today reported; (3) reporter Harris’s open records request related to the dyed
diesel refund included citations to Arizona case law, so that establishes USA Today
knew or should have known that it was false for USA Today to report that Ryan’s
efforts were “contrary to long-standing tax law[]”; (4) Woodruff and Nülle—aides
to Governor Ducey—were fired 24 hours after they contradicted the Governor on
the school funding proposition, which Woodruff publicly acknowledged in an
interview with USA Today; (5) reporter Harris knew that the former State employees
hired by Ryan had never been employed by the Department of Revenue nor had they
worked on the dyed diesel fuel issue before Ryan retained them, and Harris should
have known that the “cooling off period” statute did not apply under these
circumstances, so Ryan could have no culpability under the statute; and (6) there is
17 no factual basis for USA Today’s reporting that there was an FBI investigation of
Ryan, which USA Today did not retract despite Ryan asking for a retraction.
As to the North Dakota activities and reporting, Ryan argues that USA Today
knew or should have known its reporting was false because: (1) Ryan’s legal
argument was documented, and the North Dakota Tax Court found it was the tax
commissioner’s position which was meritless; (2) Ryan informed USA Today that a
senior North Dakota tax official had apologized for blaming Ryan for “issue
shopping” which was something that another company had actually used, yet USA
Today did not include the apology in its subsequent reporting and instead
misrepresented Ryan’s work and failed to retract the misrepresentation; and (3) even
though the North Dakota Court had ruled in Ryan’s favor, USA Today continued to
make false allegations about Ryan’s work in Arizona when it published articles
about Ryan’s work in North Dakota, leaving readers with a “substantially false
impression[.]”
Ryan asserts that it suffered harm to its business and reputation because it lost
business opportunities and customers—specifically, Ryan alleged it lost the account
of Deloitte LLP, who terminated its working relationship with Ryan and cited the
USA Today’s reporting about Ryan as the primary reason for terminating the
relationship. Ryan also alleges it has spent hundreds of thousands of dollars in
repairing the harm to its reputation and business.
18 USA Today’s Objections to the Chronis Affidavit Filed in Support of Plaintiff’s Response to TCPA Motion
The day before the hearing on the motion to dismiss, USA Today filed
objections to the Chronis 9 Affidavit, which was attached to Ryan’s response.
According to USA Today, certain statements in Chronis’s affidavit were conclusory
and an improper legal conclusion, not based on personal knowledge, or inadmissible
hearsay. USA Today also objected to Chronis describing the meaning of the
challenged, allegedly defamatory statements, arguing that the affidavit contained
“improper meaning testimony” because defamation is tested by how the ordinary
reader would understand a statement and not what Chronis says it means. USA
Today also filed a reply in support of its motion to dismiss, generally arguing that
the statements at issue are not false, and therefore, not defamatory.
After a hearing on the motion to dismiss, the trial court signed an Order on
Motion to Dismiss and Ancillary Items Related Thereto. The trial court sustained
some of USA Today’s objections to the Chronis Affidavit but overruled most of the
objections. In some instances, the court wrote that it did not regard the objected-to
statements as “evidence” but rather regarded it as “a heading related to the topics to
follow.” The trial court denied USA Today’s motion to dismiss, stating, “The Court
finds that Defendants neither established their affirmative defenses nor established
9 Damon Chronis is the president of Ryan, LLC. 19 that they were entitled to judgment as a matter of law. In contrast, the Court finds
that Plaintiff presented clear and specific evidence in support of Plaintiff’s
defamation claim.” Defendants timely filed a Notice of Interlocutory Appeal.
Issues On Appeal
Appellants raise four issues on appeal. In the first issue, they argue that the
trial court erred in denying their motion to dismiss under the TCPA. In the second
issue, Appellants argue that Ryan failed to satisfy its burden under the TCPA to
submit clear and specific evidence to support each essential element of its
defamation claims. In the third issue, Appellants argue that they are entitled to
judgment as a matter of law, including on their affirmative defenses. And in the
fourth issue, Appellants argue that the trial court abused its discretion by failing to
exclude evidence comprised of conclusory statements, speculation, and inadmissible
hearsay.
Admission of Evidence
We address Appellants’ fourth issue first, which concerns the admission of
evidence. Evidentiary rulings are committed to the trial court’s sound discretion. U-
Haul Int’l, Inc. v. Waldrip, 380 S.W.3d 118, 132 (Tex. 2012) (citing Bay Area
Healthcare Grp., Ltd. v. McShane, 239 S.W.3d 231, 234 (Tex. 2007) (per curiam)).
A trial court abuses its discretion when it acts without regard for guiding rules or
principles. Id. (citing Owens-Corning Fiberglas Corp. v. Malone, 972 S.W.2d 35,
20 43 (Tex. 1998)). “The trial court has extensive discretion in evidentiary rulings, and
we will uphold decisions within the zone of reasonable disagreement.” Diamond
Offshore Servs. Ltd. v. Williams, 542 S.W.3d 539, 545 (Tex. 2018).
“Relevant evidence is presumed to be admissible.” JBS Carriers, Inc. v.
Washington, 564 S.W.3d 830, 836 (Tex. 2018) (citing Tex. R. Evid. 402). Even if
the trial court abused its discretion in ruling on the admission or exclusion of certain
evidence, reversal is only appropriate if the error was harmful—that is, it probably
resulted in an improper judgment. See Nissan Motor Co. Ltd. v. Armstrong, 145
S.W.3d 131, 144 (Tex. 2004); City of Brownsville v. Alvarado, 897 S.W.2d 750, 753
(Tex. 1995); see also Tex. R. App. P. 44.1, 61.1. We will uphold a trial court’s ruling
on the admission of evidence if there is any legitimate basis for the ruling. See
Malone, 972 S.W.2d at 43 (“An appellate court must uphold the trial court’s
evidentiary ruling if there is any legitimate basis for the ruling.”). A successful
challenge to evidentiary rulings usually requires the complaining party to show that
admission of the challenged evidence probably resulted in an improper outcome—
usually by showing that the court’s ruling turns on the particular evidence excluded
or admitted. U-Haul Int’l, Inc., 380 S.W.3d at 132 (citing Tex. R. App. P. 44.1, 61.1);
Alvarado, 897 S.W.2d at 753-54.
Section 27.006(a) of the Civil Practice and Remedies Code provides:
In determining whether a legal action is subject to or should be dismissed under this chapter, the court shall consider the pleadings, 21 evidence a court could consider under Rule 166a, Texas Rules of Civil Procedure, and supporting and opposing affidavits stating the facts on which the liability or defense is based.
Tex. Civ. Prac. & Rem. Code Ann. § 27.006(a); see also Tex. R. Civ. P. 166a(c);
Montano v. Cronan, No. 09-20-00232-CV, 2021 Tex. App. LEXIS 5654, at *20
(Tex. App.—Beaumont July 15, 2021, no pet.) (mem. op.). Therefore, we look to
the standards in Rule 166a.10
On December 15, 2022—the day before the hearing on the motion to
dismiss—USA Today filed objections to the affidavit of Damon Chronis (Ryan’s
president), which was attached to Ryan’s response to the motion to dismiss and to
which numerous exhibits were attached. Defendants raised 31 objections to certain
sections of the Chronis affidavit, and in some instances, objected to multiple
sentences within a section. Defendants objected to some statements in the Chronis
affidavit as conclusory, improper legal conclusions, improper meaning testimony,11
10 The Legislature expressly adopted the Rule 166a timeliness requirements in the 2019 amendments to the TCPA. See Atlas Survival Shelters, LLC v. Scott, No. 12-20-00054-CV, 2020 Tex. App. LEXIS 9170, at **10-11 (Tex. App.—Tyler Nov. 18, 2020, no pet.) (mem. op.) (citing Act of May 17, 2019, 86th Leg., R.S., ch. 378, § 12, 2019 Tex. Gen. Laws 960, 962 (amended 2019) (current version at Tex. Civ. Prac. & Rem. Code Ann. § 27.006(a))). 11 USA Today objected to certain assertions in the Chronis affidavit as “improper meaning testimony” and explained that, in a claim for defamation, the meaning of a publication is determined by how it would be understood by the ordinary reader and not by Chronis (or any other specific individual) and what he says it means. 22 not based on the affiant’s personal knowledge, lacking a foundation, containing
inadmissible hearsay, and based on improper lay opinion.
The trial court’s order denying USA Today’s motion to dismiss reflects that
the trial court considered USA Today’s objections to Ryan’s evidence, and the order
includes rulings on USA Today’s objections. The trial court sustained eight of USA
Today’s objections and overruled the rest. In some instances, in overruling an
objection, the trial court wrote, “the Court notes that it does not accept this portion
of the affidavit as evidence, but, instead, views it as a heading related to the topics
to follow.” In one instance, the trial court overruled the objection and wrote, “the
Court treats the statement as an operative fact[,]” which referred to a sentence in the
Chronis affidavit that reads, “Ryan, through a letter from its counsel to Gannett dated
January 28, 2022, [] expressly told Gannett that Ryan has never been contacted by
the FBI in connection with an investigation and was completely unaware of the
existence of any investigation into any of Ryan’s activities in Arizona.” Otherwise,
the trial court overruled USA Today’s objections without explanation.
On appeal, USA Today argues that the trial court abused its discretion in
overruling the bulk of its objections and that “[b]ecause Ryan relied on this
incompetent evidence to support its Step 2 showing, the trial court’s refusal to
exclude it was harmful error and resulted in the rendition of its erroneous judgment.”
Appellee argues that Appellants’ argument is “only a vague and conclusory
23 analysis” and that Appellants cannot show that the admission of the challenged
evidence probably caused the rendition of an improper judgment.
USA Today’s argument about why the trial court’s admission of the
complained-of-evidence outlined in its fourth issue harmed doesn’t explain how
admitting the evidence led the trial court to render an improper judgment. It’s entire
argument on harm is that “the trial court’s refusal to exclude [the challenged
statements in the Chronis affidavit] was harmful error and resulted in the rendition
of its erroneous judgment.” This argument is insufficient to comply with the
requirements that apply to appellate briefs because it fails to “apply the facts to the
cited law to show how the trial court committed error.” See Golden v. Milstead
Towing and Storage, Nos. 09-21-00043-CV, 09-21-00044-CV, 09-21-00045-CV,
2022 Tex. App. LEXIS 2988, at *9 (Tex. App.—Beaumont May 5, 2022, no pet.)
(mem. op.). As stated above, a party seeking reversal based on evidentiary error must
show that the error probably resulted in an improper judgment, which usually
requires the complaining party to show that the judgment turns on the challenged
evidence. See Alvarado, 897 S.W.2d at 753-54. USA Today failed to meet this
requirement. See id.; see also Tex. R. App. P. 44.1(a); U-Haul Int’l, Inc., 380 S.W.3d
at 136. Issue four is overruled.
24 TCPA Motion to Dismiss
Standard of Review
We review a trial court’s denial of a TCPA motion to dismiss under a de novo
standard of review. See Walker v. Hartman, 516 S.W.3d 71, 79-80 (Tex. App.—
Beaumont 2017, pet. denied) (citation omitted); see also Adams v. Starside Custom
Builders, LLC, 547 S.W.3d 890, 897 (Tex. 2018) (citations omitted). Our de novo
review includes whether the parties met their burdens of proof under the TCPA and
whether a nonmovant has presented clear and specific evidence establishing a prima
facie case for each essential element of the challenged claims. See Landry’s, Inc. v.
Animal Legal Defense Fund, 631 S.W.3d 40, 45-46 (Tex. 2021). We consider the
pleadings and affidavits stating the allegations upon which the claim or defense is
based in the light most favorable to the nonmovant. See Tex. Civ. Prac. & Rem.
Code Ann. § 27.006(a); In re Lipsky, 460 S.W.3d 579, 586-87 (Tex. 2015) (orig.
proceeding); Push Start Indus., LLC v. Hous. Gulf Energy Corp., No. 09-19-00290-
CV, 2020 Tex. App. LEXIS 9337, at *6 (Tex. App.—Beaumont Nov. 30, 2020, no
pet.) (mem. op.) (citations omitted). We consider evidence a court could consider
under Rule 166a of the Texas Rules of Civil Procedure. See Tex. Civ. Prac. & Rem.
Code Ann. § 27.006(a).
25 Burden of Proof Under the TCPA
The TCPA provides a three-step process courts must follow in deciding
whether to dismiss a “legal action” to which the TCPA applies. Montelongo v.
Abrea, 622 S.W.3d 290, 295-96 (Tex. 2021). First, the defendant who has moved to
dismiss must show by a preponderance of the evidence that the plaintiff’s claim is
based on, relates to, or is in response to the movant’s exercise of (1) the right of free
speech, (2) the right to petition, or (3) the right of association. See ExxonMobil
Pipeline Co. v. Coleman, 512 S.W.3d 895, 898 (Tex. 2017) (per curiam) (citing Tex.
Civ. Prac. & Rem. Code Ann. § 27.005(b)).
Next, if the defendant meets its burden, the burden shifts to the plaintiff to
“establish[] by clear and specific evidence a prima facie case for each essential
element of the claim in question.” Id. at 899 (quoting Tex. Civ. Prac. & Rem. Code
Ann. § 27.005(c)); Montelongo, 622 S.W.3d at 296. Finally, if the plaintiff makes
this showing, the court will dismiss the action if the defendant “establishes 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(d);
Montelongo, 622 S.W.3d at 296. Prima facie means “at first sight,” and under the
TCPA, a prima facie case is the “minimum quantum of evidence necessary to
support a rational inference that the allegation of fact is true.” USA Lending Grp.,
Inc. v. Winstead PC, 669 S.W.3d 195, 200 (Tex. 2023) (citing S&S Emergency
26 Training Sols., Inc. v. Elliott, 564 S.W.3d 843, 847 (Tex. 2018); Prima facie,
Garner’s Dictionary of Legal Usage (3d ed. 2011)). Evidence is “clear and specific”
if it provides enough detail to show the factual basis for the claim. Id. (citing In re
Lipsky, 460 S.W.3d at 590-91). Such evidence need not be conclusive,
uncontroverted, or found credible. Id. (citing In re Lipsky, 460 S.W.3d at 590).
On the third step of the analysis, we examine whether the defendants have
established that they are entitled to judgment as a matter of law on their affirmative
defenses. See Rogers v. Bryan, No. 09-21-00338-CV, 2023 Tex. App. LEXIS 505,
at *49 (Tex. App.—Beaumont Jan. 26, 2023, no pet.) (mem. op.). When determining
whether a party who seeks to dismiss the plaintiff’s case under the TCPA has met
its burden on this third step, we apply a standard of review essentially equivalent to
a motion for summary judgment on an affirmative defense. Id.; H-E-B, L.P. v.
Maverick Int’l, Ltd., No. 09-21-00311-CV, 2022 Tex App. Lexis 7428, at *10 (Tex.
App.—Beaumont Oct. 6, 2022, pet. granted, judgm’t vacated w.r.m.) (mem. op.). 12
12 See also Rockman v. Ob Hospitalist Grp., Inc., No. 01-21-00383-CV, 2023 Tex. App. LEXIS 3055, at *38 (Tex. App.—Houston [1st Dist.] May 9, 2023, no pet.) (mem. op.) (citing Zidan v. Zidan, No. 05-20-00786-CV, 2022 Tex. App. LEXIS 8744, at *11 (Tex. App.—Dallas Nov. 30, 2022, no pet.) (mem. op.); Rosales v. Comm’n for Lawyer Discipline, No. 03-18-00725-CV, 2020 Tex. App. LEXIS 3350, at **9-10 (Tex. App.—Austin Apr. 22, 2020, no pet.) (mem. op.); Batra v. Covenant Health Sys., 562 S.W.3d 696, 708 (Tex. App.—Amarillo 2018, pet. denied)); see also Graves v. Evangelista-Ysasaga, No. 14-22-00137-CV, 2023 Tex. App. LEXIS 399, at **14-16 (Tex. App.—Houston [14th Dist.] Jan. 24, 2023, pet. denied) (mem. op.) (defendant failed to prove they were entitled to judgment as a matter of law where a fact issue existed on defendant’s affirmative defense). 27 Matter of Public Concern
Our first task is to determine whether Ryan’s defamation claims as alleged in
its petition are based on or in response to USA Today’s exercise of the right of free
speech or pertain to communications made in connection with a matter of public
concern. See Tex. Civ. Prac. & Rem. Code Ann. § 27.001(3). In this case, Ryan’s
defamation claims related to USA’s publication of articles referencing Ryan and the
activities and actions Ryan allegedly undertook in representing its clients, as well as
actions that were allegedly taken by Arizona and North Dakota state officials, certain
judicial proceedings that involved Ryan’s clients, and public funds. We conclude
that the stories USA Today published on these matters pertained to “political, social
or other interest[s] to the community[]” and to “subject[s] of concern to the public.”
See Tex. Civ. Prac. & Rem. Code Ann. § 27.001(7).
Appellant argues that Ryan does not dispute that its defamation claim is
subject to the TCPA because its defamation claim relates to USA Today’s right of
free speech or pertained to a matter of public concern. Additionally, we agree that
Ryan’s claims are based on USA Today’s exercise of its free speech. USA Today
has satisfied its burden on the first step of the analysis, and therefore we proceed to
the second step of the analysis. See Lilith Fund for Reprod. Equity v. Dickson, 662
S.W.3d 355, 363 (Tex. 2023); Netflix, Inc. v. Barina, No. 04-21-00327-CV, 2022
28 Tex. App. LEXIS 6637, at *6 (Tex. App.—San Antonio Aug. 31, 2022, pet. denied)
(mem. op.).
Plaintiff’s Prima Facie Case
Next, we must determine whether Ryan established a prima facie case of
defamation, establishing it has “clear and specific evidence” to support each
essential element of its claim. See ExxonMobil Pipeline Co., 512 S.W.3d at 898
(citing Tex. Civ. Prac. & Rem. Code Ann. § 27.005(c)); Montelongo, 622 S.W.3d at
296. To recover on a claim for defamation, a plaintiff must prove (1) 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, at least amounting to negligence, and
(4) that proximately caused damages.13 Innovative Block of S. Tex., Ltd. v. Valley
Builders Supply, Inc., 603 S.W.3d 409, 417 (Tex. 2020); Anderson v. Durant, 550
S.W.3d 605, 617-18 (Tex. 2018); In re Lipsky, 460 S.W.3d at 593.
The status of the person allegedly defamed determines the requisite degree of fault. A private individual need only prove negligence, whereas a public figure or official must prove actual malice. “Actual malice” in this context means that the statement was made with knowledge of its falsity or with reckless disregard for its truth.
13 The parties do not dispute whether the challenged statements were published to a third party. The challenged statements appeared in USA Today, The Arizona Republic, on Twitter, or on The Arizona Republic’s podcast “The Gaggle.” We conclude that Ryan met the publication element of its claim for defamation by clear and specific evidence. See ExxonMobil Pipeline Co. v. Coleman, 512 S.W.3d 895, 898 (Tex. 2017) (per curiam). 29 In re Lipsky, 460 S.W.3d at 593 (citations omitted). “In a defamation case that
implicates the TCPA, pleadings and evidence that establishes the facts of when,
where, and what was said, the defamatory nature of the statements, and how they
damaged the plaintiff should be sufficient to resist a TCPA motion to dismiss.” Id.
at 590-91.
a. Did Ryan establish that the challenged statements are defamatory about Ryan?
Our first step in evaluating a defamation claim is to determine whether the
challenged statements are reasonably capable of a defamatory meaning about Ryan.
See Anderson, 550 S.W.3d at 617-18; Dall. Morning News, Inc. v. Tatum, 554
S.W.3d 614, 625 (Tex. 2018). A statement is defamatory if it “tends to injure a []
person’s reputation and thereby expose the person to public hatred, contempt or
ridicule, or financial injury or to impeach any person’s honesty, integrity, virtue, or
reputation or to publish the natural defects of anyone and thereby expose the person
to public hatred, ridicule, or financial injury.” Tex. Civ. Prac. & Rem. Code Ann.
§ 73.001; see also Waste Mgmt. of Tex., Inc. v. Tex. Disposal Sys. Landfill, Inc., 434
S.W.3d 142, 150 & n.35 (Tex. 2014) (a corporation may bring a claim for libel);
Newspapers, Inc. v. Matthews, 339 S.W.2d 890, 893 (Tex. 1960) (corporations and
partnerships may bring a claim for libel). A statement is defamatory per se if it is so
obviously harmful that general damages are presumed, and generally involves
accusing someone of a crime, of having a loathsome disease, of engaging in sexual 30 misconduct, or that adversely reflects on a person’s fitness to conduct his business
or occupation. See In re Lipsky, 460 S.W.3d at 596.
We do not decide whether the alleged statements are true or false, instead
. . . we judge the truth or falsity of an allegedly defamatory statement by identifying the “gist” of what the statement conveys about the plaintiff to a reasonable reader of the entire article. If the gist of the challenged statement, within the context of the article as a whole, is true, then the statement is considered substantially true and therefore not actionable—even if the statement errs in the details.
See Polk Cnty. Publ’g Co. v. Coleman, No. 22-0103, 2024 Tex. LEXIS 124, at *3
(Tex. Feb. 16, 2024); see also D Mag. Partners, L.P. v. Rosenthal, 529 S.W.3d 429,
434 (Tex. 2017). Identifying the gist of an alleged defamatory publication and
deciding whether a publication is capable of a defamatory meaning are questions of
law for the court. See Coleman, 2024 Tex. LEXIS 124, at *11 (citing Turner v. KTRK
Television, Inc., 38 S.W.3d 103, 114 (Tex. 2000)). We determine a publication’s
“‘gist or meaning by examining how a person of ordinary intelligence would view
it[,]’” asking how a “‘hypothetical reasonable reader’” would understand the
publication, and not how any particular reader actually understood it. See id. at *11
(quoting Neely v. Wilson, 418 S.W.3d 52, 64 (Tex. 2013); New Times, Inc. v. Isaacks,
146 S.W.3d 144, 157 (Tex. 2004)). We consider a publication “as a whole[]” and
“in light of the surrounding circumstances” in determining whether it communicates
defamatory falsehoods, and we may also consider an entire series of articles treating
the same subject matter to determine defamatory meaning. Id. at *16; Scripps NP 31 Operating, LLC v. Carter, 573 S.W.3d 781, 790-91 (Tex. 2019); Rosenthal, 529
S.W.3d at 434.
“[A] plaintiff can bring a claim for defamation when discrete facts, literally or
substantially true, are published in such a way that they create a substantially false
and defamatory impression by omitting material facts or juxtaposing facts in a
misleading way.” Turner, 38 S.W.3d at 115. Even so, it is not defamatory if it
contains “‘specific statements that err in the details but that correctly convey the gist
of a [true] story[.]’” Coleman, 2024 Tex. LEXIS 124, at *11 (quoting Neely, 418
S.W.3d at 63-64). We also ask whether an alleged defamatory statement is more
damaging to the plaintiff’s reputation in the mind of the average reader than a
truthful statement would have been. See id. at *20 (citing McIlvain v. Jacobs, 794
S.W.2d 14, 16 (Tex. 1990)).
In Ryan’s First Amended Petition, Ryan alleges that “USA Today falsely
accuse[d] Ryan of corruption and unethical business practices by misrepresenting
the facts about Ryan’s work on the dyed diesel [tax] refund request in Arizona[.]”
Ryan also alleges that USA Today “intentionally misrepresented a number of
material facts” about Ryan’s work in Arizona—by describing its work as secretive,
by suggesting it proposed a payout over time to avoid legislative scrutiny, by falsely
reporting there was no legal basis for Ryan’s position on the tax refund request, by
creating a false impression by failing to report that Ryan initially obtained a
32 favorable ruling in Tax Court, by misleading readers into thinking that Governor
Ducey had fired Woodruff and Nülle over the dyed diesel matter rather than the
education funding proposition, by suggesting that Ryan violated Arizona’s conflict
of interest law, and by claiming there was an FBI investigation and implying that
Ryan was the subject of the investigation.
Ryan also alleges that “USA Today falsely accuse[d] Ryan of corruption and
unethical business practices by misrepresenting the facts about Ryan’s work on the
oil well production equipment refund request in North Dakota.” According to Ryan,
USA Today falsely claimed Ryan had filed “questionable” or “frivolous” refund
claims in North Dakota, and USA Today implied that Ryan engaged in unethical
business practices by “issue shopping” different state tax department employees.
Ryan’s petition identifies 9 statements that Ryan claims are false and
defamatory when standing alone or when viewed together because they create “a
substantially false and defamatory impression of Ryan.” According to Ryan, the
challenged statements “create a substantially false and defamatory impression by
omitting material facts or juxtaposing facts in a misleading way.”
In addition to a defamation by “gist” claim, a party may establish that the
defamatory meaning arises implicitly from a distinct portion of the article that
contains a factually defamatory statement rather than from the article’s “as-a-whole
gist.” There is a distinction between an “as-a-whole” gist claim and “partial”
33 implication claim. Tatum, 554 S.W.3d at 622, 628-29 (acknowledging and
discussing the differences). In Tatum, the Court explained that the differences matter
especially in two contexts:
The first relates to the substantial-truth doctrine. “A broadcast with specific statements that err in the details but that correctly convey the gist of a story is substantially true.” Neely, 418 S.W.3d at 63-64. If the plaintiff demonstrates substantial truth, the doctrine “precludes liability for a publication that correctly conveys a story’s ‘gist’ or ‘sting’ although erring in the details . . . .” Turner, 38 S.W.3d at 115. We have never held, nor do we today, that a true implication—as opposed to a true gist—can save a defendant from liability for publishing an otherwise factually defamatory statement. Second, the difference between gist and implication matters when considering the requirements that the U.S. Constitution imposes on defamation law.
Id. at 629.
Here, we agree with Ryan that the articles published by USA Today present
Ryan in an unfavorable light, and we conclude the articles do so both as a whole and
in discrete sections by implication. See id. at 627 (discussing defamation by
implication where a publication “gets the details right but fails to put them in the
proper context and thereby gets the story’s ‘gist’ [] wrong[]”) (quoting Turner, 38
S.W.3d at 115). In particular, we note an August 31, 2021 article in The Arizona
Republic/USA Today reads, “FBI examining $100M tax refund push by Arizona
Gov. Ducey staffers after Arizona Republic/USA TODAY investigation[.]” The first
sentence of the article states, “The FBI’s Public Corruption unit is investigating
efforts by Arizona Gov. Doug Ducey’s past and current staffers [] to push for a
34 closed-door deal to issue tax refunds worth as much as $100 million to aid one of
Ducey’s campaign supporters.” The focus in the title and the first sentence appears
to be on Ducey, and not on Ryan, but the title alludes to a tax refund of $100 million
to aid one of Ducey’s campaign supporters, and then the only campaign supporter
discussed by name in the article is G. Brint Ryan, the founder of Ryan, LLC. The
article later reports that Nülle told USA Today that the FBI contacted him to see if
he had received any threats after the Arizona Republic published its series of articles,
and the article states that Nülle stated “that the FBI had interviewed him several
times in May regarding the refund campaign[]” and, that he stated “[t]hey are
investigating the whole situation, but I don’t know what they have[.]” The article
further stated that the reporter had contacted the FBI and a spokeswoman stated,
“As a matter of course, the FBI does not confirm or deny the existence of
investigations.” The article in question then focuses more on Ryan and less on
Ducey. For example, it states, “G. Brint Ryan, a major GOP contributor, and his
firm [Ryan, LLC] used insiders to gain access to Ducey to try to get what Ryan
wanted and how the Texas millionaire could help Ducey’s political ambitions.”
And that statement is not attributed to any third party. The article further states, “If
Ryan’s client had won that refund, it would have set precedent enabling similar
companies to claim more than $100 million in refunds from state coffers, according
35 to Department of Revenue officials, and Ryan’s firm would have been able to garner
millions in commissions.”
Other articles dated July 14, 2021, in The Arizona Republic and USA Today
are titled or contain headlines or statements such as “He made a fortune winning tax
refunds. He needed help from Arizona’s most powerful leader[,]” “Arizona’s
governor had political aspirations. He also had a pipeline to a big GOP supporter[,]”
“They were Gov. Doug Ducey’s top officials. Then they went after a huge tax
refund[,]” “She was the governor’s deputy chief of staff. The tax deal she pushed
would benefit her father’s mining firm[,]” “They stood up against a tax refund that
would have cost Arizonans. It cost them their jobs[,]”; and a January 10, 2022 USA
Today article titled “Firm helps companies get rich with ‘questionable’ tax refunds,
tactics that exhaust officials[.]”
We conclude that Ryan met its prima facie burden to show a hypothetical
reasonable reader would understand the articles imply that Ryan, as well as the
Governor of Arizona, and the former State employees hired by Ryan, had engaged
in unethical, if not unlawful, conduct or even corruption, and further that Ryan and
the Governor were under investigation by the FBI for their conduct or possible
corruption. See Isaacks, 146 S.W.3d at 157. Ryan met its burden to show that the
complained-of statements are defamatory as to Ryan because they are “‘reasonably
capable’” of injuring Ryan’s reputation. See Tatum, 554 S.W.3d at 637-38 (quoting
36 Musser v. Smith Protective Servs., Inc., 723 S.W.2d 653, 655 (Tex. 1987)); see also
Anderson, 550 S.W.3d at 617-18; In re Lipsky, 460 S.W.3d at 593. Viewing the
evidence in the light most favorable to the nonmovant Ryan, as we must, we
conclude that Ryan presented clear and specific evidence from which a person of
ordinary intelligence would view the “gist” of the challenged statements as
defamatory. See Tex. Civ. Prac. & Rem. Code Ann. § 27.006(a); Rosenthal, 529
S.W.3d at 434; In re Lipsky, 460 S.W.3d at 586-87; Push Start Indus., LLC, 2020
Tex. App. LEXIS 9337, at *6.
b. Did USA Today act with the requisite degree of fault?
The degree of fault a plaintiff must prove in its defamation claim depends on
whether the plaintiff is a private figure or public or limited-purpose public figure.
See In re 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, Inc. v. McLemore, 978 S.W.2d 568, 571 (Tex. 1998)). In the context of
a defamation claim, a defendant is negligent if it knew or should have known a
defamatory statement was false unless the content of the false statement would not
warn a reasonably prudent publisher of its defamatory potential. See Rosenthal, 529
S.W.3d at 440. “Negligent conduct is determined by asking ‘whether the defendant
acted reasonably in checking the truth or falsity or defamatory character of the
communication before publishing it.’” Scripps Tex. Newspapers, L.P. v. Belalcazar,
37 99 S.W.3d 829, 837 (Tex. App.—Corpus Christi 2003, pet. denied) (quoting
Restatement (Second) of Torts § 580B cmt. g (1977)).
Ryan maintains that it is a private party and only negligence is required. In
USA Today’s motion to dismiss under the TCPA, it did not take a position on
whether Ryan was a private person or public figure, nor did USA Today argue about
the degree of fault that Ryan must prove. USA Today also does not argue on appeal
that Ryan is a public figure.14
Assuming without deciding that Ryan is not a public figure and that it need
only establish negligence, the record in this case provided sufficient evidence to
make a prima facie case that USA Today negligently published the alleged
defamatory statements. Exhibits attached to Ryan’s response to the motion to
dismiss include letters from Ryan’s counsel to USA Today dated November 2, 2021
and January 28, 2022, advising USA Today that USA Today had falsely reported
about Ryan’s work in Arizona and North Dakota and stating that “The [Arizona]
Republic knew before publication, those accusations are demonstrably false.”
The Arizona Tax Court’s initial decision on the dyed diesel tax refund is a
published decision, issued on September 4, 2018. See Carter Oil Co., Inc. v. Ariz.
14 That said, we note that in the Answer filed by USA Today to the Petition, it alleged, “Plaintiff is a public figure for purposes of this action and is required to prove actual malice by clear and convincing evidence. The statements at issue were made without actual malice.” 38 Dep’t of Revenue, No. TX 2016-001218, 2018 Ariz. Tax LEXIS 11 (Ariz. Tax Ct.
Sept. 4, 2018), rev’d by 460 P.3d 808 (Ariz. App. 2020). The facts stated in that
reported opinion explain that Carter Oil sold dyed diesel fuel to Hanson Aggregates
Arizona, Inc. for use in heavy equipment used in gravel mining and processing in
Arizona. See 460 P.3d at 810. The Arizona Tax Court ruled in favor of Ryan’s client
(Carter Oil Co.) granting a refund for the dyed diesel tax, but the Arizona Court of
Appeals reversed that decision. Id. The Arizona Court of Appeals explained that the
appeal presented the issue of “whether the dyed diesel [] is ‘machinery or equipment’
used directly in mining and processing operations.” Id. at 811. The Court concluded
that dyed diesel fuel is not machinery or equipment and that the fuel is “subject to
the transaction privilege tax but not the fuel tax.” Id. at 813, 815. So, Ryan’s client
Carter Oil initially prevailed in the Arizona tax court, and that decision was reversed
on appeal.
We read the Arizona Court of Appeals decision as an opinion based on
statutory construction, and although the Arizona Court of Appeals found against
Ryan’s client, the court did not include any statement or conclude that Carter Oil’s
position and argument was either “baseless” or “frivolous,” nor did it find that Carter
Oil’s argument was unsupported by any legal authority or contrary to “long-standing
tax law[,]” as USA Today had represented. See id. at 811.
39 As to Ryan’s work on behalf of its client in North Dakota, the refund sought
by Ryan’s client Equinor Energy LP concerned a request for a refund on sales and
use tax for certain oilfield machinery and equipment—including separators used in
gas collection and processing. The clerk’s record in this case includes a copy of a
January 7, 2022 Order by a North Dakota District Court reversing the state’s Tax
Commissioner’s denial of a tax refund. See Equinor Energy LP v. State of North
Dakota, No. 08-2021-CV-00309 (Burleigh Cnty. Dist. Ct. Jan. 7. 2022). As
explained in the Order, Equinor had sought a refund of more than $5 million, and
although the Tax Commissioner allowed a large portion of the request, it denied over
two million dollars of the request rejecting the argument that pertained to separators
being tax exempt. Equinor appealed the decision of the Tax Commissioner to the
District Court. The North Dakota District Court found that the Tax Commissioner’s
ruling which denied the refund was not supported by a preponderance of the
evidence and “not in accordance with North Dakota law.” The District Court stated:
[] Equinor asserts that the Commissioner’s Order should be reversed on the following grounds: 1) the findings of fact are not supported by a preponderance of the evidence, 2) the findings of fact do not sufficiently address the evidence presented by Equinor at the August 11-12, 2020 hearing, 3) the conclusions of law and order are not supported by the findings of fact, and 4) the Commissioner’s Order is not in accordance with North Dakota law. The Court finds that the Commissioner’s order is reversed on all grounds cited by Equinor.
The District Court reversed and remanded the matter for findings and conclusions
consistent with its Order. 40 According to Ryan, “Three days after the Tax Court ruling in Equinor’s favor,
Gannett published the North Dakota Article and misrepresented and concealed
multiple facts about Ryan’s work in North Dakota sufficient to make the article
substantially false[.]” Our record lacks any evidence of what occurred after the
remand, but nothing in the record reflects a defeat for Ryan’s client’s legal position
in North Dakota, nor does the record support USA Today’s statement that Ryan’s
legal position on behalf of its client Equinor in the North Dakota matter was
“questionable” or “frivolous.” Neither the Arizona Court of Appeals opinion nor the
North Dakota District Court Order found the positions taken by Ryan’s clients—
Carter Oil and Equinor Energy, respectively—were frivolous or questionable.
Further, nothing in Craig Harris’s affidavit reflects that he interviewed anyone
with Ryan before publishing the news articles at issue. See Rosenthal, 529 S.W.3d
at 440 (concluding that a magazine acted with negligence when it “failed to take
reasonable steps to verify the accuracy of the story’s gist and should have known the
gist was false”). According to Ryan, even when Ryan’s counsel informed USA
Today of the false or misleading statements in its reporting, and specifically
referenced the legal decisions in Arizona and North Dakota, USA Today did not
issue a retraction or correction. See CBS Stations Grp. of Tex., LLC v. Burns, No.
05-21-00042-CV, 2021 Tex. App. LEXIS 7907, at **10-11 (Tex. App.—Dallas
Sept. 27, 2021, no pet.) (mem. op.) (concluding a plaintiff had established negligence
41 where plaintiff notified a television station and objected to its reporting as harmful,
the station manager said “she would take care of it[]” but the station reran the story
and left the story posted online); cf. Zerangue v. TSP Newspapers, Inc., 814 F.2d
1066, 1071 (5th Cir. 1987) (“[R]eadiness to print a retraction weighs against
‘malice.’”). We conclude that Ryan has presented at least a minimum quantum of
evidence that USA Today acted negligently when making the statements that are the
subject of this lawsuit. See USA Lending Grp., Inc., 669 S.W.3d at 200; Rosenthal,
529 S.W.3d at 440.
c. Did the plaintiff establish it sustained damages as a result of the statements?
Assuming without deciding that the statements were not defamatory per se,
Ryan bears the burden to present a minimum quantum of clear and specific evidence
that it suffered damages as a result of the challenged statements by USA Today. See
In re Lipsky, 460 S.W.3d at 593. “[G]eneral averments of direct economic losses and
lost profits[]” do not satisfy the TCPA’s requirement of clear and specific evidence
unless the evidence includes “specific facts illustrating how [a defendant’s] alleged
remarks about [the plaintiff’s] activities actually caused such losses.” Id. at 593.
The affidavit of Damon Chronis, Ryan’s president, was attached as an exhibit
to Ryan’s response to USA Today’s motion to dismiss. Therein, Chronis states, in
relevant part in paragraph 19:
As a result of [USA Today’s] defamatory statements concerning Ryan, Ryan has lost business opportunities and customers with multiple long- 42 time clients and new clients. For example, after [USA Today] published its defamatory statements about Ryan, Deloitte LLP terminated its engagement with Ryan and explicitly cited [USA Today’s] reporting as a primary reason for terminating their agreement. As a result, Ryan suffered losses of approximately $100,000 from lost income from Deloitte for 2021. Ryan has also spent hundreds of thousands of dollars in an attempt to repair the harm to its reputation and business caused by [USA Today].
USA Today objected to paragraph 19, sentence 1 as conclusory, and sentence 2 as
hearsay, without further elaboration. The trial court overruled these objections and
we have already determined in our discussion on appellate issue four, that we cannot
say the trial court abused its discretion in making its evidentiary rulings. Based on
all of the evidence Ryan presented, we conclude that Ryan presented clear and
specific evidence of how USA Today’s statements resulted in some damage to Ryan.
See id. at 591; see also Innovative Block of S. Tex., Ltd., 603 S.W.3d at 418
(explaining that damages for injury to reputation are considered general damages);
Montano, 2021 Tex. App. LEXIS 5654, at *17 (concluding, in part, that a statement
in an affidavit that the plaintiff had lost business clients was clear and specific
evidence of damages).
USA Today’s Affirmative Defenses
As previously explained, in the third step of our TCPA analysis, when the
nonmoving party has satisfied its burden to present clear and specific evidence of a
prima facie claim for relief, the burden then shifts back to the moving party to
“establish[] an affirmative defense or other grounds on which the moving party is 43 entitled to judgment as a matter of law.” See Tex. Civ. Prac. & Rem. Code Ann.
§ 27.005(d). We apply the standard for summary judgment, and the movant must
establish every element of its affirmative defense as a matter of law, such that a
reasonable factfinder can draw only one conclusion from the evidence. See Tex. R.
Civ. P. 166a; Rockman v. Ob Hospitalist Grp., Inc., No. 01-21-00383-CV, 2023 Tex.
App. LEXIS 3055, at *38 (Tex. App.—Houston [1st Dist.] May 9, 2023, no pet.)
(mem. op.) (citing Draughon, 631 S.W.3d at 88; City of Keller, 168 S.W.3d at 815-
16); see also Graves, 2023 Tex. App. LEXIS 399, at **15-16 (defendant failed to
prove they were entitled to judgment as a matter of law where a fact issue existed on
the defense).
USA Today argues that, even if we conclude that Ryan established a prima
facie case of defamation, USA Today is still entitled to dismissal under the TCPA
because it is entitled to judgment as a matter of law on its affirmative defenses.
Specifically, USA Today argues that Ryan cannot overcome USA Today’s
affirmative defenses, which we summarize as follows:
Accurate reporting: USA Today asserts that the statements at issue are true or substantially true and accurate reporting of third-party allegations about matters of public concern. See Tex. Civ. Prac. & Rem. Code Ann. § 73.005(a)-(b)
Privileged reporting about official proceedings or the acts of public officials: USA Today asserts that the statements at issue are fair, true and impartial accounts of judicial, executive, or other official proceedings to administer the law. See id. § 73.002(b)(1), (2).
44 Privileged commentary on matters of public concern. See id. § 73.002(b)(2)
Constitutionally-protected opinion. See, e.g., Tatum, 554 S.W.3d at 638 (explaining that statements of opinion that “are not verifiable as false” are not defamatory).
According to USA Today’s motion to dismiss, “[a]s the plaintiff, Ryan carries
the burden on all of these elements.”15 While it is true that Ryan carries the burden
to show a prima facie claim, USA Today carries the burden on its affirmative
defenses. See Tex. Civ. Prac. & Rem. Code Ann. § 27.005(d). The media’s privilege
to report on judicial or other official proceedings is an affirmative defense on which
the defendant bears the burden of proof. See KBMT Operating Co., LLC v. Toledo,
492 S.W.3d 710, 714 (Tex. 2016) (citing Denton Publ’g Co. v. Boyd, 460 S.W.2d
881, 884 (Tex. 1970). Likewise, truth and the privilege of fair comment on matters
of public concern are affirmative defenses. See Bentley v. Bunton, 94 S.W.3d 561,
579 (Tex. 2002) (explaining that, in Milkovich v. Lorain Journal Co., 497 U.S. 1, 13
(1990), the Court explained that the privilege of fair comment was incorporated into
the common law as an affirmative defense to defamation); Randall’s Food Mkts.,
15 Appellants erroneously cite to the prior version of the statute, which provided that a court shall dismiss the action if the movant established a defense “by a preponderance of the evidence[,]” whereas the current version of the statute requires the movant to prove it “is entitled to judgment as a matter of law.” See Tex. Civ. Prac. & Rem. Code Ann. § 27.005(d) (amended 2019). 45 Inc. v. Johnson, 891 S.W.2d 640, 646 (Tex. 1995) (“Truth is a complete defense to
defamation.”).
That said, statements that are not verifiable as false, such as mere opinions or
subjective assertions, are constitutionally protected and are not actionable in
defamation. See Carr v. Brasher, 776 S.W.2d 567, 570 (Tex. 1989) (citing Gertz v.
Robert Welch, Inc., 418 U.S. 323, 339-40 (1974)). USA Today argued in the trial
court that “[a]ny accusation that Ryan’s legal position was unsupported [by law] is
subjective opinion[]” and not actionable as defamatory. In response to the motion to
dismiss, Ryan offered the Chronis affidavit in which Chronis attested that Ryan’s
work on the Arizona dyed diesel fuel matter “included a detailed review of the
relevant Arizona statutes and case law[]” and stated that Ryan initially prevailed in
Tax Court. As to Ryan’s work in North Dakota, Chronis attested that “Ryan’s
position was supported by the plain language of the statute, legislative history, expert
witness testimony, and other evidence[,]” that Ryan had provided extensive
documentation for its position, and that the North Dakota Tax Court found that “it
was the tax commissioner’s position—not Ryan’s—that was found by the Tax Court
to be meritless, ‘arbitrary,’ and not supported by the law.” We conclude that the
filings and rulings in the administrative and judicial proceedings at issue are
verifiable. See id. at 570.
46 Nothing in our record reflects that either the Arizona Court of Appeals or the
North Dakota Tax Court found Ryan’s clients’ arguments had been made in “bad
faith” or without citation to legal authority. Simply stated, the Arizona Court of
Appeals reversed the tax court decision that had been issued in favor of Ryan’s
client’s legal position, and the North Dakota Court reversed the North Dakota Tax
Commissioner’s denial of the refunds and ruled in favor of Ryan’s client and agreed
with Ryan’s argument. At a minimum, we conclude that USA Today has fallen short
in meeting its burden on their affirmative defense because the evidence in the record
established a question of fact exists about whether Ryan’s work on behalf of its
clients was “unsupported” by the law. See Tex. Civ. Prac. & Rem. Code Ann.
§ 27.005(d); City of Keller, 168 S.W.3d at 815-16; Rockman, 2023 Tex. App. LEXIS
3055, at *38; Graves, 2023 Tex. App. LEXIS 399, at **15-16.
USA Today also argues that it “accurately reported the allegations of various
public officials, independent observers, and others who questioned Ryan’s tactics
and the work of its lobbyists.” Ryan countered that many of the statements it regards
as defamatory “are not sourced and therefore could not be shielded by the third-party
allegations privilege[,]” and they also “create a defamatory impression by
misrepresenting material facts, omitting material facts, and juxtaposing facts in a
misleading way.” Ryan argued that the statements at issue cannot be categorized as
protected opinion, and that USA Today’s reporting on official proceedings
47 “contained key omissions so as to make its statements on those proceedings
substantially false.”
We have previously explained herein that Ryan met its prima facie burden to
show that the “gist” of the challenged statements is defamatory as to Ryan. See
Coleman, 2024 Tex. LEXIS 124, at *3; Rosenthal, 529 S.W.3d at 434. 16
The headline of an August 31, 2021 USA Today article reads, “FBI examining
$100M tax refund push by Arizona Gov. Ducey staffers after Arizona Republic/USA
TODAY investigation[.]” The text of the article states, in relevant part,
Nulle said in a phone interview that an FBI agent had called to check on the safety of him and his family. The agent, from the Public Corruption Unit’s Phoenix office, wanted to know if Nülle had received any threats after the series was published. ... “They are investigating the whole situation, but I don’t know what they have,” Nulle said. . . . ... FBI Spokeswoman Brooke Brennan said on Monday: “As a matter of course, the FBI does not confirm or deny the existence of investigations.”
16 That said, we also note some of the statements that Ryan has challenged were made on “The Gaggle,” a podcast of The Arizona Republic, and those verbal, unwritten statements may not be covered under the privileges expressly provided for in Chapter 73 of the Civil Practice and Remedies Code because they were oral and not expressed in written or other graphic form. See Tex. Civ. Prac. & Rem. Code Ann. §§ 73.001 (defining libel as “a defamation expressed in written or other graphic form”), 73.002(a) (defining privileged matters and stating, “The publication by a newspaper or other periodical of a matter covered by this section is privileged and is not a ground for a libel action.”) (emphasis added). We need not decide this question here. 48 The article goes on to report that Governor Ducey knew of no FBI investigation and
his office had not been contacted by the FBI. According to evidence submitted to
the trial court, Ryan’s president states
. . . Ryan has never been contacted by the FBI in connection with an investigation and was completely unaware of the existence of any investigation into any of Ryan’s activities in Arizona. In the nearly year and half since [USA Today] first published that claim, Ryan still has not been contacted by the FBI.
Considering the evidence in a light most favorable to the nonmovant, as we
must in our TCPA review, we conclude that the evidence in the record creates a
genuine fact issue on whether USA Today accurately reported whether the FBI was
investigating Ryan, and that fact issue precludes USA Today from proving it is
entitled to judgment as a matter of law on the affirmative defense of accurate
reporting on this aspect of the alleged defamatory gist claim. See Tex. Civ. Prac. &
Rem. Code Ann. §§ 27.005(d), 73.005(a)-(b); City of Keller, 168 S.W.3d at 815-16;
Rockman, 2023 Tex. App. LEXIS 3055, at *38. We have already discussed that Ryan
sufficiently established a prima facie case showing its “gist” claim against USA
Today as to the characterizations of the legal proceedings in Arizona and North
Dakota, the FBI investigation, and as to Ryan’s related activities for its clients. See
Tex. Civ. Prac. & Rem. Code Ann. § 73.002(b)(1)(A); Coleman, 2024 Tex. LEXIS
124, at *11. And we conclude that USA Today has not met its burden to show that
49 it is entitled to judgment as a matter of law on its claimed defenses. See id.
§ 27.005(d); Rockman, 2023 Tex. App. LEXIS 3055, at *38.
Conclusion
To summarize, we conclude that the trial court did not err in finding that Ryan
satisfied its burden to present clear and specific evidence in support of its claim for
defamation, nor did the trial court err in concluding that USA Today failed to
establish that it is entitled to judgment as a matter of law on its defenses. See Tex.
Civ. Prac. & Rem. Code Ann. § 27.005(c), (d); ExxonMobil Pipeline Co., 512
S.W.3d at 898; Rockman, 2023 Tex. App. LEXIS 3055, at *38. And we overruled
USA Today’s evidentiary complaint because we cannot say the trial court abused its
discretion. Therefore, the trial court did not err by denying USA Today’s motion to
dismiss under the TCPA. See Adams, 547 S.W.3d at 897. Having overruled all of
Appellants’ issues, we affirm the order of the trial court. 17
17 We previously explained above that this Court concluded the trial court erred in failing to transfer venue to Dallas County. See In re USA Today, No. 09-23- 00140-CV, 2023 Tex. App. LEXIS 7963 (Tex. App.—Beaumont Oct. 19, 2023, orig. proceeding) (mem. op.) (finding that when a limited liability company sues for defamation, the county in which the plaintiff resided at the time of the accrual of the cause of action is the county where the limited liability company maintains its principal office, and because the plaintiff did not file its suit for defamation in a county of proper venue, the court conditionally granted mandamus relief). The transfer of venue of the defamation case has been held pending a ruling and final mandate in this Court on the TCPA motion to dismiss. Once the mandate issues in this appellate matter (No. 09-22-00432-CV), then the trial court and district clerk may implement the transfer of venue outlined in our judgment in No. 09-23-00140- CV. 50 AFFIRMED.
LEANNE JOHNSON Justice
Submitted on September 19, 2023 Opinion Delivered May 2, 2024
Before Horton, Johnson and Wright, JJ.
Related
Cite This Page — Counsel Stack
USA Today A/K/A Gannett Co., Inc., Gannett Publishing Services, LLC, and Gannett Satellite Information Network, LLC v. Ryan, LLC, Counsel Stack Legal Research, https://law.counselstack.com/opinion/usa-today-aka-gannett-co-inc-gannett-publishing-services-llc-and-texapp-2024.