Neurodiagnostic Consultants, LLC D/B/A Synaptic Resources of Austin, LLC, a Texas Limited Liability Company v. Melody Nallia, an Individual Corey Villalobos, an Individual Bryan Bouillion, an Individual Lee Cobb, an Individual Nia Hudson, an Individual TRAXX Medical Holdings, LLC, a Delaware Limited Liability Company TRAXX Blue, LLC, a Delaware Limited Liability Company TRAXX Connected, LLC, a Delaware Limited Liability Company And TRAXX Federated, LLC, a Delaware Limited Liability Company ( 2019 )

TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN
NO. 03-18-00609-CV
Neurodiagnostic Consultants, LLC d/b/a Synaptic Resources of Austin, LLC,
a Texas Limited Liability Company, Appellant
v.
Melody Nallia, an individual; Corey Villalobos, an individual;
Bryan Bouillion, an individual; Lee Cobb, an individual;
Traxx Medical Holdings, LLC, a Delaware Limited Liability Company;
Traxx Blue, LLC, a Delaware Limited Liability Company;
Traxx Connected, LLC, a Delaware Limited Liability Company; and
Traxx Federated, LLC, a Delaware Limited Liability Company, Appellees
FROM THE 353RD DISTRICT COURT OF TRAVIS COUNTY
NO. D-1-GN-18-004422, THE HONORABLE JAN SOIFER, JUDGE PRESIDING
MEMORANDUM OPINION
Neurodiagnostic Consultants, LLC d/b/a Synaptic Resources of Austin, LLC
(Synaptic) appeals from the trial court’s order granting the appellees’ motion to dismiss pursuant
to the Texas Citizens Participation Act. See Tex. Civ. Prac. & Rem. Code § 27.003. Because we
conclude that Synaptic met its burden under the Act to demonstrate by clear and specific
evidence a prima facie case for each essential element of its claims, we reverse the trial court’s
judgment and remand the cause for further proceedings.
BACKGROUND
Factual and Procedural History
Synaptic is a business that provides intraoperative neurophysiological monitoring
(IONM) services to hospitals, clinics, and surgeons in and around Waco, Austin, San Marcos, and
San Antonio.1 To provide these services, Synaptic employs IONM technologists. All technologists
hired by Synaptic are trained to use Synaptic’s monitoring equipment and are required to
complete six to eight weeks of in-house training using a course program developed by Synaptic.
Synaptic also requires that its technologists work toward obtaining their Certification for
Neurophysiological Monitoring (CNIM), which requires the completion of additional coursework
and the passing of an examination. The duties of Synaptic technologists include setting up and
operating Synaptic’s monitoring equipment, interviewing patients prior to surgery, connecting
patients to Synaptic’s monitoring equipment, consulting with surgeons, and monitoring the
neurophysiological status of patients throughout surgery.
In September 2008, Synaptic hired Melody Nallia as a technologist and in 2012
promoted her to Area Manager. According to Synaptic, in her role as manager, Nallia was “one
of Synaptic’s primary operatives in all of Texas for retaining current clients and obtaining new
ones.” In January 2015, Synaptic hired Corey Villalobos as a technologist and, in January 2016,
promoted him to Field Manager. During his tenure at Synaptic, Villalobos’s direct supervisor was
Nallia. Villalobos left Synaptic in September 2016, and Nallia left Synaptic in April 2017. Upon
leaving, both Nallia and Villalobos immediately began working for Traxx, a competitor of Synaptic.
1
According to Synaptic, IONM is the monitoring of the integrity of a patient’s nervous
system during surgery.
2
Synaptic later filed suit against Nallia and Villalobos, along with Traxx2 and
Traxx officers Bryan Bouillion and Lee Cobb (collectively, the Defendants) for a variety of
claims arising from Nallia’s and Villalobos’s former employment with Synaptic and from their
relationship and subsequent employment with Traxx. In general, Synaptic alleges that Bouillion
and Cobb formed Traxx to compete with Synaptic in the Austin IONM market and solicited
Nallia and Villalobos to help Traxx launch its business. Beginning in June 2016, while still
employed with Synaptic, both Nallia and Villalobos began communicating with Bouillon and
Cobb and, in Synaptic’s view, actively engaging in efforts that benefitted Traxx and caused harm
to Synaptic.
On June 7, 2018, the Defendants filed a motion to dismiss pursuant to Chapter 27
of the Texas Civil Practice and Remedies Code, also known at the Texas Citizens Participation
Act (the TCPA). See id. §§ 27.001-.011. In their motion, the Defendants argued that all of
Synaptic’s claims fell within the scope of the TCPA and that Synaptic could not meet its burden
under the TCPA of establishing a prima facie case for each essential element of its claims.
See id. §§ 27.003, .005. In its response to the motion, Synaptic asserted that the TCPA motion
should be denied because it had established a prima facie case for each of its claims with clear
and specific evidence. In support of its response, Synaptic provided the trial court with:
∙ an affidavit from Steve Thomas, the Manager of Synaptic Resources of Austin;
2
Synaptic sued Traxx Medical Holdings, LLC; Traxx Blue, LLC; Traxx Connected,
LLC; and Traxx Federated, LLC. For simplicity, we will refer to these business entity
defendants, collectively, as “Traxx.” We will refer to Bouillion, Cobb, and Traxx, collectively,
as “the Traxx Defendants.”
3
∙ a copy of Nallia’s employment agreement with Synaptic;
∙ a copy of Villalobos’s employment agreement with Synaptic;
∙ a reporter’s record, including exhibits, from a temporary-injunction hearing
conducted earlier in the case;
∙ a copy of Synaptic’s original petition and application for injunctive relief;
∙ a copy of Synaptic’s first amended petition and application for injunctive relief;
∙ a text string between Bouillion and Nallia;
∙ an e-mail, dated February 22, 2018, from the Defendants’ counsel’s paralegal,
stating that documents responsive to Synaptic’s discovery request were attached
and were bates-labeled D0001-0104;
∙ a text string between Villalobos and Nallia;
∙ an e-mail exchange between Bouillon and Nallia, from August 2016;
∙ an e-mail from Nallia to Bouillion, dated August 19, 2016;
∙ an e-mail from Nallia to Bouillion, dated August 19, 2016, with attached resume
and employment application from Lauren Baker;
∙ an e-mail from Lauren Baker to Synaptic, dated August 19, 2016;
∙ a text string between Nallia and Cobb;
∙ an e-mail exchange between Nallia and Cobb, dated September 12, 2016;
∙ a portion of a transcript of Villalobos’s testimony from a hearing in a suit filed
by Synaptic in Bexar County against Villalobos, cause number 2017-CI-16541;
∙ a copy of a temporary-injunction order from the Bexar County suit; and
∙ an e-mail dated June 24, 2016, from Nallia to Bouillion with a copy of Nallia’s
employment agreement attached.
Without specifying the reason for its ruling, the trial court granted the
Defendants’ motion and dismissed all of Synaptic’s claims. Synaptic perfected its appeal in
this Court.
4
Texas Citizens Participation Act
The Texas Legislature passed the TCPA 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
the statute’s purpose, the Legislature has provided a two-step procedure to expedite the dismissal
of claims brought to intimidate or to silence a defendant’s exercise of these First Amendment
rights.” ExxonMobil Pipeline Co. v. Coleman, 512 S.W.3d 895, 898 (Tex. 2017). A party
seeking to invoke the protection of the TCPA initiates this procedure by filing a motion to
dismiss. See Tex. Civ. Prac. & Rem. Code §§ 27.003 (“Motion to Dismiss”), .005 (“Ruling”).
Under the first step, the movant bears the initial burden of showing that the TCPA
applies to the nonmovant’s legal action. That is, the movant must show by a preponderance of
the evidence that the “legal action 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.”
Id. § 27.005(b). Under the second step, if the trial court determines that the movant has met his
burden to show that the TCPA applies, the burden shifts to the nonmovant to establish “by clear
and specific evidence a prima facie case for each essential element of the claim in question.” Id.
§ 27.005(c). If the nonmovant fails to present sufficient evidence of a prima facie case, the trial
court must dismiss the action within the TCPA’s expedited time frame. See id. § 27.005(c)-(d).
However, even if the nonmovant satisfies his burden of establishing a prima facie case, the
movant may still obtain dismissal by establishing “by a preponderance of the evidence each
essential element of a valid defense to the nonmovant’s claim.” Id. § 27.005(d).
5
We review trial court’s ruling on a motion to dismiss under the TCPA under a
de novo standard of review. Serafine v. Blunt, 466 S.W.3d 352, 357 (Tex. App.—Austin
2015, no pet.); Campbell v. Clark, 471 S.W.3d 615, 623 (Tex. App.—Dallas 2015, no pet.).
Accordingly, we consider de novo the trial court’s determinations of whether the movant has
established by a preponderance of the evidence that the TCPA applies to the challenged claim
and whether the nonmovant has presented clear and specific evidence establishing a prima facie
case for each essential element of the challenged claim. Warner Bros. Entm’t, Inc. v. Jones,
538 S.W.3d 781, 797 (Tex. App.—Austin 2017, pet. granted).
ANALYSIS
In this case, Synaptic does not challenge the trial court’s determination that the
TCPA applies to its claims. Instead, Synaptic’s sole complaint on appeal is that the trial court
erred in granting the Defendants’ TCPA motion and in dismissing its claims because, according
to Synaptic, it satisfied its burden under the second step of the TCPA to present clear and
specific evidence establishing a prima facie case for each essential element of the claims at issue
and because the Defendants did not establish a valid defense. See Tex. Civ. Prac. & Rem. Code
§ 27.005(b), (d).
The term “clear and specific evidence” “refers to the quality of evidence required
to establish a prima facie case.” Serafine, 466 S.W.3d at 358. Because the TCPA does not define
“clear and specific evidence,” we give those terms their ordinary meaning: “clear” meaning
“unambiguous, sure, or free from doubt,” and “specific” meaning “explicit or relating to a
particular named thing.” In re Lipsky, 460 S.W.3d 579, 590 (Tex. 2015) (orig. proceeding). In
this context, “evidence” includes “the pleadings and supporting and opposing affidavits stating
6
the facts on which the liability or defense is based.” Tex. Civ. Prac. & Rem. Code § 27.006(a);
Serafine, 466 S.W.3d at 360 (noting that under TCPA, “the trial court may consider pleadings
as evidence”).
In Lipsky, the Texas Supreme Court expressly rejected the notion that the “clear
and specific evidence” standard imposes a heightened evidentiary standard. See 460 S.W.3d
at 590-91. In addition, the nonmovant plaintiff may satisfy its burden using circumstantial
evidence. Id. Circumstantial evidence is “indirect evidence that creates an inference to establish
a central fact,” and some factual determinations, such as state of mind, may depend exclusively
on circumstantial evidence. Warner Bros. Entm’t, 538 S.W.3d at 799 (citing Lipsky, 460 S.W.3d
at 589; Bentley v. Bunton, 94 S.W.3d 561, 596 (Tex. 2002) (noting that claims involving state of
mind must usually be established by circumstantial evidence)). The Act does, however, require
more than “mere notice pleading,” and general allegations that merely recite the elements of a
cause of action will not be sufficient to establish a prima facie case. Lipsky, 460 S.W.3d at 590.
Instead, a plaintiff must “provide enough detail to show the factual basis for its claim.” Cavin v.
Abbott, 545 S.W.3d 47, 72 (Tex. App.—Austin 2017, no pet.) (quoting Lipsky, 460 S.W.3d at 591).
A prima facie case “refers to evidence 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. “It is 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) (per curiam)).
When determining if the nonmovant has met his burden, the court views all of the “evidence” in
the light most favorable to the nonmovant. Warner Bros. Entm’t, 538 S.W.3d at 801. If the
nonmovant provides evidence that establishes a prima facie case if left uncontradicted and
7
unexplained, the prima facie case is rebutted only when the true facts are conclusively shown by
other evidence. Id.
With these principles in mind, we will evaluate the pleadings and evidence in this
case. See Tex. Civ. Prac. & Rem. Code § 27.006(a) (“In determining whether a legal action
should be dismissed under this chapter, the court shall consider the pleadings and supporting and
opposing affidavits stating the facts on which the liability or defense is based.”).
Synaptic’s Allegations and Evidence
Synaptic alleges in its live pleadings that it employed Nallia and Villalobos to
perform IONM services in Waco, Austin, and San Antonio for surgeons in these cities and
surrounding areas who had selected Synaptic as their IONM service provider. Nallia and
Villalobos were originally employed as technologists but were later promoted to managerial
positions with Synaptic. Specifically, Nallia was promoted to Area Manager, and Villalobos was
promoted to Field Manager in the same area. As managers, Synaptic provided Nallia and
Villalobos with information that Synaptic considered to be highly confidential and proprietary,
such as pricing information from Synaptic’s contracts and agreements with each of its hospital
and facility clients.3 According to Synaptic, it independently negotiates its pricing with each
medical facility. Nallia and Villalobos were also provided with the terms of Synaptic’s employment
agreements with other employees, Synaptic’s technologist’s field manual, Synaptic’s policy and
procedure manual, and its proprietary business strategy to effectively reduce costs and increase
profit. During their employment, Nallia and Villalobos also learned of the personal preferences
3
Although Synaptic contracts and has agreements with the hospitals, it is most often the
individual surgeon with whom Synaptic has developed a relationship who will exercise his or her
discretion to select Synaptic as the preferred IONM vendor.
8
of individual surgeons developed by Synaptic for case coverage and had access to Synaptic’s
proprietary programs utilizing surgeon preferences for customer-client satisfaction and business
development purposes. Nallia and Villalobos obtained Synaptic’s client feedback and
participated in using Synaptic’s collected information to improve services and further develop
business strategies for Synaptic. Finally, Nallia and Villalobos were familiar with Synaptic’s
developed training program and software, as well as continuing education requirements.
Synaptic alleges that it learned soon after Nallia and Villalobos left Synaptic that
Nallia and Villalobos had “engaged in efforts to benefit Traxx, an IONM company that competes
directly with Synaptic, long before either’s employment with Synaptic ended.” Although Traxx
was not legally formed until August 2016, Nallia had developed a professional relationship with
Bouillion beginning in 2014, and in 2015 Nallia informed Bouillion that she wanted to leave
Synaptic. Evidence submitted by Synaptic in response to the Defendants’ motion shows that in
June 2016, while still employed as an Area Manager at Synaptic, Nallia began communicating
with Bouillion and his business partner, Cobb, about creating and operating Traxx as well as
helping Traxx enter into the IONM business. Nallia arranged for Villalobos, also employed by
Synaptic at the time, to meet with Bouillion about job opportunities at Traxx. Following a lunch
meeting between Bouillion, Nallia, and Villalobos on June 24, 2016, Nallia texted Bouillion that
she and Villalobos were “really excited about the opportunity and hope everything works out.
Let me know if you have any further questions and I will be happy to help.” Nallia also
forwarded to Bouillion a copy of her employment agreement with Synaptic. Bouillion responded
by stating that he was going to “maneuver around” Nallia’s and Villalobos’s employment
agreements with Synaptic and, the next month, asked Nallia what cities she and Villalobos would
be willing to move to “for non-compete reasons.” In text messages to Nallia, Villalobos referred
9
to Traxx as his company, stated that he wanted to be one to “start” Traxx, and suggested
that Synaptic might not actually sue to enforce their employment agreements. When Villalobos
suggested that Traxx could “buy [their] way out” of the non-compete, Nallia responded, “Yeah, I
mentioned it and [Bouillion] made it seem like we wouldn’t need to do that necessarily. I also
told him you would be willing to sneak around.”
Synaptic alleges that after the June 24, 2016 lunch meeting, Nallia and Villalobos
began providing Bouillion and Cobb with confidential information belonging to Synaptic that
would help Traxx compete directly with Synaptic. According to Synaptic’s pleadings, Nallia
assisted Traxx in identifying technologists who had previously worked at Synaptic and whom
Traxx could potentially hire, advised Bouillion about the technology and equipment that Traxx
would need to compete in the IONM market, and provided Bouillion and Cobb with customer
pricing information that Traxx could then use to acquire customers from Synaptic. For example,
in July 2016, Nallia informed Bouillion in a text that one of Synaptic’s interpreting physicians,
Dr. Yanko Yankov, was being paid $150 per case but was unhappy with this compensation
arrangement with Synaptic and wanted to be paid $250 per case. Nallia informed Bouillion
that Synaptic was not willing to pay Dr. Yankov more money, that Dr. Yankov likely would be
willing to work with Traxx, and that she could provide all of his contact information.4 Bouillion
responded, “Cool . . . We will pay 200-250. Please send me his info.” The next month, Dr. Yankov
terminated his relationship with Synaptic.
4
In his affidavit, Steve Thomas, manager of Synaptic Resources Austin, LLC, states
that “Synaptic does not permit its interpreting physicians to provide services to other IONM
companies while under contract with Synaptic,” and that “[a]s of July 26, 2016, Dr. Yankov had
an exclusive business relationship with Synaptic as an interpreting physician.”
10
On June 28, 2016, Bouillion e-mailed Nallia to get advice on whether Traxx
should purchase a type of IONM equipment called the “Caldwell Pro” or, instead, purchase a
type of equipment called the “Elite.” Nallia responded by telling Bouillion to purchase the “Pro,”
explaining that Synaptic owns an “Elite” but “hardly ever uses it.” Similarly, in September 2016,
Cobb e-mailed Nallia, “This is a quote for [IONM equipment] 2 16 channel. That is the machine
we need? And do we need all the options on this quote? Or is there anything we can take off?”
Nallia responded, “Looks right to me. You also may want to ask them about VEP goggles. I
didn’t see them on the list but it is very possible you may need them. They are used on pituitary
tumor cases which I know [Drs.] Hummell/Tumu do.”
In August 2016, Bouillion contacted Nallia by e-mail and asked for her help in
deciding how to “get the best people,” “get them to stay,” “grow as a CNIM tech,” and
“progress[] towards a manager.” Nallia responded with a formulated career path, which included
position titles, job duties, and compensation levels for technologists and managers. That same
month, Nallia forwarded information to Bouillion about a potential technologist, Lauren Baker,
who had submitted her application and resume to Synaptic through the Synaptic website. Nallia
told Bouillion that even though Baker had applied to Synaptic, it “shouldn’t be a problem” and
later informed Bouillion that Synaptic’s president really wanted to hire Baker. Nallia initially
planned to attend Baker’s interview with Traxx, but later requested that Cobb send Villalobos
in her place. In a text to Cobb, Nallia stated that she had already agreed to attend Synaptic’s
interview of Baker that same day, and she did not want to make Baker feel uncomfortable,
presumably by seeing Nallia at interviews for two separate companies. Villalobos attended
Baker’s interview with Traxx in Nallia’s place, and Baker eventually accepted employment with
Traxx instead of Synaptic.
11
Synaptic also alleges that Nallia and Villalobos actively induced doctors and
facilities to terminate their relationships with Synaptic. On August 19, 2016, eight months
before leaving Synaptic, Nallia e-mailed Bouillion that she had “looked through her file and was
able to get a contact for Arise,” a medical facility where Synaptic IONM provided services. In
the same e-mail, Nallia provided Bouillion with the name and e-mail of her purported contact at
Arise. On August 24, 2016, Nallia texted Villalobos that “Bryan [Bouillion] told me [Dr.]
[S]tokes is in but they are going to wait on him a bit [because] they have to get into [S]eton. He
said right now they are going to start working at [A]rise and [St. David’s Medical Center].”
Dr. John Stokes is a customer of Synaptic for whom Nallia had performed IONM services on
at least 51 surgeries. Arise, Seton, and St. David’s Medical Center are medical facilities where
Synaptic performed IONM. In addition, while employed at Synaptic, Nallia provided IONM
services for Austin neurosurgeons Drs. Hari Tamu, Daniel Peterson, and Marcella Madera
during more than 50 surgeries. After Nallia left in March 2017, those doctors stopped engaging
Synaptic and began using Traxx to perform IONM services. Similarly, after Villalobos left
Synaptic in September 2016, he began providing IONM services for Dr. Peterson, for whom he
had provided IONM services at Synaptic. Villalobos also began encouraging Nallia to leave
Synaptic and come to work for Traxx, which she eventually did in April 2017.
Synaptic sued (1) Nallia and Villalobos for breach of contract; (2) Villalobos,
Cobb, Bouillion, and Traxx for intentional interference with contract; (3) Nallia and Villalobos
for misappropriation of trade secrets; (4) Nallia and Villalobos for breach of fiduciary duty;
and (5) Bouillon, Cobb, and Traxx for inducing, assisting, and participating in Nallia’s and
Villalobos’s breach of fiduciary duty. Synaptic also sought to hold all of the Defendants jointly
liable for the alleged unlawful acts of each other under a theory of civil conspiracy.
12
Breach of Contract and Intentional Interference with Contract
To defeat the Defendants’ motion to dismiss with respect to its breach-of-contract
claims against Nallia and Villalobos, Synaptic was required to establish a prima facie case by
clear and specific evidence that (1) valid contracts existed between Synaptic and Nallia and
Villalobos; (2) Synaptic tendered performance or was excused from doing so; (3) Nallia and
Villalobos breached the terms of their contracts; and (4) Synaptic sustained damages as a result
of the breaches. See USAA Tex. Lloyds Co. v. Menchaca, 545 S.W.3d 479, 501 n.21 (Tex. 2018).
Similarly, to establish a prima facie case on its tortious-interference-with-contract claims against
Bouillion, Cobb, and Traxx, Synaptic was required to present clear and specific evidence
establishing (1) an existing contract subject to interference, (2) a willful and intentional act of
interference with the contract (3) that proximately caused Synaptic’s injury and (4) caused actual
damages or loss. See Prudential Ins. Co. of Am. v. Financial Review Servs., Inc., 29 S.W.3d 74,
77 (Tex. 2000).
The allegations in Synaptic’s live pleadings and the evidence presented by
Synaptic in support of its response to the motion to dismiss, show that Synaptic had valid
employment agreements with Nallia and Villalobos. These agreements, copies of which were
attached to Synaptic’s response, were signed by Nallia and Villalobos and outlined the terms
of their employment. In part, the agreements required Nallia and Villalobos, as part of their
managerial duties, to “devote [their] full professional time to the performance of [their] duties”
and to “not engage in any professional activities that would interfere with the performance of
[their] duties.” The agreements also prohibited Nallia and Villalobos, both during and after their
employment, from competing with Synaptic in the IONM business; from soliciting employees,
consultants, contractors, and customers of Synaptic; and, at any time, from disclosing
13
confidential information belonging to Synaptic. Synaptic tendered performance by employing
Nallia and Villalobos for several years and by providing them with access to information that
Synaptic considered to be confidential and proprietary. See Alex Sheshunoff Mgmt. Servs., L.P.
v. Johnson, 209 S.W.3d 644, 655 (Tex. 2006) (employee’s promise not to disclose confidential
information may serve as foundation for enforceable non-compete agreement when promise is
accepted by employer’s tendering of confidential information).
The record also establishes by clear and specific evidence that Nallia and
Villalobos breached their respective employment agreements, both during and immediately after
their employment with Synaptic. Synaptic’s allegations and the evidence, viewed in the light
most favorable to Synaptic, establish that even before their employment with Synaptic ended,
Nallia and Villalobos actively assisted Traxx in its plans and preparations to enter and compete
in the Austin IONM marketplace. In addition, Nallia provided information and advice to
Bouillion and Cobb to assist Traxx in the IONM marketplace, and the non-disclosure provision
in Nallia’s employment agreement specifically defined “confidential information” as including at
least some of the information that she provided. When Nallia and Villalobos left Synaptic, they
immediately went to work for Traxx providing IONM services. Finally, Synaptic presented clear
and specific evidence that when Bouillion and Cobb requested Nallia’s and Villalobos’s
assistance in establishing and operating Traxx, they were aware of Nallia’s and Villalobos’s
employment with Synaptic and with the terms of their employment agreements, including their
non-competition and non-disclosure provisions. Similarly, Villalobos was aware of Nallia’s
employment agreement and its non-competition provision when he encouraged Nallia to leave
Synaptic and work for Traxx.
14
Finally, to prevail on their claims for breach of contract and for intentional
interference of contract, Synaptic must show that it has suffered actual damages or injury as a
result of the Defendants’ wrongful conduct. See USAA Tex. Lloyds, 545 S.W.3d at 501 n.21;
Prudential Ins. Co. of Am., 29 S.W.3d at 77. Synaptic alleges that due to the wrongful actions by
Nallia and Villalobos, “Bouillion and Cobb were able to establish Traxx as a competitor and
gain unfair competitive advantages over Synaptic that Traxx would not have otherwise had.”
According to Synaptic, it has “suffered, and continues to suffer, direct damages in the form of
lost profits, business opportunities, and economic advantages.” Although the Defendants do not
dispute that Synaptic has established a prima facie case with respect to most of the essential
elements of their claims for breach of contract and for intentional interference with contract, the
Defendants contend that, as a matter of law, Synaptic cannot meet its burden on the essential
element of damages or loss.
In support of their contention, the Defendants argue that Synaptic is barred by
Section 15.51 of the Covenants Not to Compete Act from recovering any damages in connection
with any alleged breach of the employment agreements. See Tex. Bus. & Com. Code §§ 15.50-
.52. This provision, in relevant part, states:
[If an otherwise enforceable covenant not to compete] contains limitations as to
time, geographical area, or scope of activity to be restrained that are not
reasonable and impose a greater restraint than is necessary to protect the goodwill
or other business interest of the promisee, the court shall reform the covenant to
the extent necessary . . . and enforce the covenant as reformed, except that the
court may not award the promisee damages for a breach of the covenant
before its reformation and the relief granted to the promise shall be limited to
injunctive relief.
Id. § 15.51(c) (emphasis added). The Defendants reason that because the non-competition
covenants at issue in this case were reformed by the trial courts following temporary-injunction
15
hearings, Synaptic is precluded from recovering damages in connection with any alleged breach
of the contractual restrictions in this case.5 The Defendants reason that this inability to recover
damages necessarily prevents Synaptic from establishing a prime facie case of contractual
damage or loss.
Assuming without deciding that Section 15.51 applies to this dispute, we disagree
that this statutory provision operates as a bar to Synaptic’s breach-of-contract and tortious-
interference-with-contract claims. First, the limitation on damages found in Section 15.51, by its
express terms, would apply only to damages sought by Synaptic for breach of the employment
agreements’ non-competition provisions and would not prevent Synaptic from recovering
damages for breach of the non-solicitation or non-disclosure provisions. Second, although a
covenant not to compete may be reformed as part of an order granting a temporary injunction, as
it was in this case, see also Tranter, Inc. v. Liss, No. 02-13-00167-CV, 2014 WL 1257278, at
*30 (Tex. App.—Fort Worth Mar. 27, 2014, no pet.) (mem. op.) (concluding that reformation “is
not only a final remedy” and may be made incidental to temporary injunctive relief), Section
15.51 applies only when the issue of enforceability of the covenant is finally determined and
reformation is made as part of a final remedy, see Primary Health Physicians, P.A. v. Sarver,
390 S.W.3d 662, 665 (Tex. App.—Dallas 2012, no pet.) (collecting cases holding that Act
5
Originally, Synaptic filed suit against Nallia in Travis County in August 2017, claiming
that she breached the non-compete and non-solicitation provisions in her employment agreement,
and sought enforcement through a temporary injunction. In November 2017, the trial court
signed an order reforming the non-compete provision and, as reformed, temporarily enjoining
Nallia from soliciting physicians and hospitals within a fifty-mile radius of Austin. Synaptic also
filed suit against Villalobos in Bexar County. In October 2017, following a temporary-injunction
hearing, the Bexar County trial court reformed the non-compete provision to prevent Villalobos
from working with or “deal[ing] in any way with surgeons with whom he worked with while
employed with Synaptic.”
16
does not preempt requirements for temporary injunctive relief and concluding Act governs only
final remedies).
In the alternative, the Defendants broadly assert that the trial court’s dismissal of
all of Synaptic’s claims—including but not limited to its claims for breach of contract and for
intentional interference with contract—was proper because Synaptic failed to meet its burden to
present clear and convincing evidence that the Defendants’ allegedly wrongful conduct caused
Synaptic to sustain any actual damages or loss. Because damages or injury is an element
common to all of Synaptic’s claims, we will reserve discussion regarding this argument for the
conclusion of our analysis.
Misappropriation of Trade Secrets
To prove an action for misappropriation of trade secrets, a plaintiff must establish
(1) the existence of a trade secret; (2) acquisition of the trade secret through a confidential
relationship or discovery of it by improper means; (3) use of the trade secret without authorization;
and (4) resulting damages to the plaintiff. Trilogy Software, Inc. v. Callidus Software, Inc.,
143 S.W.3d 452, 463 (Tex. App.—Austin 2004, pet. denied); see Tex. Civ. Prac. & Rem. Code
§§ 134A.003-.004. In 2013, the Legislature adopted the Texas Uniform Trade Secrets Act, which
defines “trade secret” as
all forms and types of information, including business, scientific, technical,
economic, or engineering information, and any formula, design, prototype, pattern,
plan, compilation, program device, program, code, device, method, technique,
process, procedure, financial data, or list of actual or potential customers or
suppliers, whether tangible or intangible and whether or how stored, compiled,
or memorialized physically, electronically, graphically, photographically, or in
writing if:
17
(A) the owner of the trade secret has taken reasonable measures under the
circumstances to keep the information secret; and
(B) the information derives independent economic value, actual or potential,
from not being generally known to, and not being readily ascertainable through
proper means by, another person who can obtain economic value from the
disclosure or use of the information.
Tex. Civ. Prac. & Rem. Code § 134A.006(2).
In this case, Synaptic’s allegations and evidence show that Synaptic possessed
information generally considered to be the kind of information entitled to protection as
trade secrets, including negotiated pricing with its customers, customer contact information,
customer preferences, marketing strategy, and strategic business plans. Sharma v. Vinmar Int’l,
Ltd., 231 S.W.3d 405, 424 (Tex. App.—Houston [14th Dist.] 2007, no pet.) (trade secrets may
include customer lists, customer contact information, pricing information, and market strategies);
Trilogy Software, 143 S.W.3d at 466 (recognizing that “information that a firm compiles regarding
its customers may enjoy trade secret status under Texas law”). Synaptic sought to keep the
information confidential by having management-level employees, such as Nallia and Villalobos,
sign non-disclosure agreements before being given access to the information. See Trilogy
Software, 143 S.W.3d at 467 (“Before information can be a ‘trade secret,’ there must be a
substantial element of secrecy.”). The evidence consequently shows that Synaptic disclosed the
trade secrets to Villalobos and Nallia in confidence, and only in furtherance of Synaptic’s
business, and that Nallia then disclosed the information to Bouillion and Cobb for use in a
competing business. See Global Water Grp., Inc. v. Atchley, 244 S.W.3d 924, 930 (Tex. App.—
Dallas 2008, pet. denied) (“Actual use or disclosure of the trade secret is a required element of
the tort. Use of the trade secret means commercial use by which the offending party seeks to
profit from the use of the secret.”). Finally, the totality of the evidence—including evidence that
18
Traxx launched into the IONM market after acquiring the confidential information—supports a
rational inference that the Traxx Defendants actually used the information to obtain a competitive
advantage. See id. (concluding that evidence of similar formula was sufficient to support
inference that trade secret was used).
Considering all the evidence and viewing it in the light most favorable to
Synaptic, we conclude that Synaptic satisfied its burden to present a prima facie case of
misappropriation of trade secrets as to Nallia, assuming that it has presented clear and specific
evidence of damages or loss. As previously discussed, the Defendants challenge Synaptic’s
prima facie case as to the element of damages, which we will discuss later. We also conclude,
however, that there are insufficient factual allegations and evidence suggesting that Villalobos
disclosed trade secrets to the Traxx defendants. Consequently, Synaptic has failed to present a
prima facie case of misappropriation of trade secrets as to Villalobos directly. Absent a showing
of a conspiracy, which we will discuss later, Villalobos cannot be liable on this claim.
Breach of Fiduciary Duty
To prove a claim for breach of fiduciary duty, a plaintiff must prove that a
fiduciary duty exists, that it was breached, and that the breach proximately caused damages.
Abetter Trucking Co. v. Arizpe, 113 S.W.3d 503, 508 (Tex. App.—Houston [1st Dist.] 2003, no
pet.). The term “fiduciary” generally applies “to any person who occupies a position of peculiar
confidence towards another,” refers to “integrity and fidelity,” and contemplates “fair dealing
and good faith.” Daniel v. Falcon Interest Realty Corp., 190 S.W.3d 177, 185 (Tex. App.—
Houston [1st Dist.] 2005, no pet.). In Texas, an employee may owe a limited fiduciary duty to
his or her employer. Johnson v. Brewer & Pritchard, P.C., 73 S.W.3d 193, 201 (Tex. 2002);
19
Orbison v. Ma-Tex Rope Co., 553 S.W.3d 17, 30 (Tex. App.—Texarkana 2018, pet. denied).
When a fiduciary relationship exists between an employee and his employer, the employee has a
duty to act primarily for the benefit of his employer in matters connected with his employment.6
Wooters v. Unitech Int’l, Inc., 513 S.W.3d 754, 762-63 (Tex. App.—Houston [1st Dist.] 2017,
pet. denied). As a result, an employee may not (1) appropriate the company’s trade secrets;
(2) solicit the former employer’s customers while still working for his employer; (3) solicit the
departure of other employees while still working for his employer; or (4) carry away confidential
information. Id. (citing Abetter Trucking Co., 113 S.W.3d at 512).
Synaptic contends, and we agree, that the express terms of the employment
agreements make clear that, as managers, Nallia and Villalobos were placed in positions of
confidence and trust. Consequently, Synaptic met its burden to present clear and specific evidence
of the existence of a fiduciary relationship.
We also conclude that Synaptic met its burden to establish a prima facie case
of breach of fiduciary duty. In part, Synaptic claims that Nallia and Villalobos breached their
fiduciary obligations by “actively soliciting and diverting employees, potential employees,
potential customers, and business opportunities to Traxx” while still employed at Synaptic. We
agree that Synaptic’s factual allegations and responsive evidence are sufficient to support this
claim of breach. For example, the record suggests that in her managerial position at Traxx,
6
An employee does not owe his employer an absolute duty of loyalty, however, and an
employee’s duty to his employer is “tempered by society’s legitimate interest in encouraging
competition.” Wooters v. Unitech Int’l, Inc., 513 S.W.3d 754, 762-63 (Tex. App.—Houston
[1st Dist.] 2017, pet. denied) (quoting Johnson v. Brewer & Pritchard, P.C., 73 S.W.3d 193, 201
(Tex. 2002)). Thus, in the absence of an enforceable non-competition agreement, an at-will
employee may “properly plan to go into competition with his employer and may take active steps
to do so while still employed.” Johnson, 73 S.W.3d at 201 (quoting Augat, Inc. v. Aegis, Inc.,
565 N.E.2d 415 (Mass. 1991)). Synaptic does not and cannot claim that Nallia and Villalobos
breached a fiduciary duty by merely planning and taking active steps to compete with Synaptic.
20
Nallia became aware of Lauren Baker as a candidate for employment and that Nallia and
Villalobos used this information to actively divert Baker to employment with Traxx.
Synaptic also claims that Nallia and Villalobos breached their fiduciary duties by
providing Bouillion, Cobb, and Traxx with “confidential information in order to provide Traxx
with unfair competition and advantages over Synaptic.” This claim of breach of fiduciary duty
overlaps factually with Synaptic’s claims for misappropriation of trade secrets and for breach of
the employment agreements’ non-disclosure provision. For the same reasons we concluded
that Synaptic presented a prima facie case of wrongdoing as to those claims against Nallia, we
conclude that Synaptic presented a prima facie case of breach of fiduciary duty based on the
disclosure of confidential information against Nallia. As previously discussed, we will reserve
our discussion of damages for the conclusion of our analysis.
Conspiracy
To prove an action for civil conspiracy, a plaintiff must establish five elements:
“(1) a combination of two or more persons; (2) the persons seek to accomplish an object or
course of action; (3) the persons reach a meeting of the minds on the object or course of action;
(4) one or more unlawful, overt acts are taken in pursuance of the object or course of action; and
(5) damages occur as a proximate result.” First United Pentecostal Church of Beaumont v.
Parker, 514 S.W.3d 214, 222 (Tex. 2017). Civil conspiracy is considered a “derivative tort,”
meaning “a defendant’s liability for conspiracy depends on participation in some underlying tort
for which the plaintiff seeks to hold at least one of the named defendants liable.” Warner Bros.
Entm’t, 538 S.W.3d at 813-14 (quoting Tilton v. Marshall, 925 S.W.2d 672, 681 (Tex. 1996)
(orig. proceeding)).
21
Viewing all the evidence in the light most favorable to Synaptic, we conclude that
a factfinder could reasonably infer from the circumstances that the Defendants had a “meeting of
the minds on the object or course of action.” See Wooters, 513 S.W.3d at 761 (explaining that
“[f]or conspiracy claims, the proof is often based on circumstantial evidence”; in reviewing
circumstantial evidence, courts “review the totality of the known circumstances”; and “[a]
conspiracy finding depends on the reasonableness of the inferences drawn from these
circumstances”). Synaptic’s factual allegations and evidence show that Nallia, Villalobos, and
the Traxx Defendants sought to launch a business providing IONM services in the Austin area, in
competition with Synaptic. The evidence and allegations also suggest that to accomplish this
objective, the Traxx Defendants sought, and Nallia disclosed, confidential information belonging
to Synaptic, at least some of which is entitled to trade-secret protection. In addition, the Traxx
Defendants obtained the assistance of Villalobos, knowing his assistance and eventual
employment would violate his obligations under his employment agreement with Synaptic.
Synaptic established, by clear and specific evidence, a prima facie case for its derivative claim
of conspiracy. Consequently, Synaptic can maintain its tort claims against all the Defendants,
including its claim of misappropriation of trade secrets against Villalobos.
Damages
Finally, we consider whether Synaptic established by clear and specific evidence
a prima facie case of the element of actual damages or loss. Although a bare recitation of the
type of damages sought is insufficient to establish a prima facie case under the TCPA, Synaptic
was not required to show a specific amount of damages, see Lipsky, 460 S.W.3d at 593-95, or to
adduce all of the evidence that it would, or could, need at trial, see Deuell v. Texas Right to Life
22
Comm., Inc., 508 S.W.3d 679, 688-89 (Tex. App.—Houston [1st Dist.] 2016, pet. denied). Instead,
to meet its burden, Synaptic was required only to adduce evidence or allege facts sufficient to
support a rational inference “that some damages naturally flowed from the [Defendants’] conduct.”
See S&S Emergency Training Sols., Inc. v. Elliott, 564 S.W.3d 843, 847 (Tex. 2018) (citing
Lipsky, 460 S.W.3d at 591); Deuell, 508 S.W.3d at 689.
Upon review of the allegations and evidence in this case, we conclude that
Synaptic met its burden of establishing by clear and specific evidence a prima facie case that it
suffered actual damages or loss as a result of the Defendants’ allegedly wrongful actions. As
previously discussed, Synaptic alleged and presented evidence that during Nallia’s employment
with Synaptic, she provided IONM services for Drs. Hari Tamu, Daniel Peterson, and Marcella
Madera, neurosurgeons in Austin, in over 50 surgeries. After Nallia left in March 2017, these
doctors stopped engaging Synaptic and began using Traxx to perform IONM services. Similarly,
Synaptic presented evidence that after Nallia disclosed to Bouillion how much Synaptic was
paying its interpreting physician, Dr. Yankov, Traxx was able to use that information to hire
Dr. Yankov away from Synaptic. In his affidavit, Synaptic manager Steve Thomas states that
Synaptic has not been able to replace Dr. Yankov since he left. Finally, with respect to Nallia’s
solicitation of Lauren Baker, Thomas states that Synaptic “desired to hire Baker, but was unable
to do so because Baker accepted employment with Traxx. . . . Synaptic still has not been able to
hire a new Technologist with a CNIM.” From the totality of the circumstantial evidence presented,
we conclude that a factfinder could reasonably infer that the actions of the Defendants, including
the disclosure of Synaptic’s confidential information and trade secrets, caused Synaptic to
lose customers, existing business relationships, and potential employees. Based on Synaptic’s
pleadings and the evidence, viewed in the light most favorable to Synaptic, we conclude that
23
Synaptic presented a prima facie case that it suffered economic injury as a result of the
Defendants’ wrongful conduct. See Warner Bros. Entm’t, 538 S.W.3d at 801.
The Defendants contend that the trial court did not err in dismissing Synaptic’s
claims because Synaptic failed to present clear and specific evidence of damages or loss.
Specifically, the Defendants assert that Synaptic did not meet its burden under the TCPA
because it “failed to produce any evidence that a customer would have done business with
Synaptic, or that any employee or prospective employee would have continued or accepted
employment with Synaptic absent any alleged misconduct.” In support of their argument, the
Defendants rely on affidavits that they submitted to the trial court as a “supplemental submission
of evidence” in support of their joint motion to dismiss. In effect, the Defendants assert that any
prima facie case of damages established by Synaptic has been effectively rebutted by affidavit
evidence that conclusively establishes that Synaptic has not, in fact, suffered any injury or
damage as a result of any wrongdoing by the Defendants. See id.
First, the Defendants point to affidavits from Drs. Hari Tamu, Daniel Peterson,
and Marcella Madera. In their affidavits, both Dr. Madera and Dr. Tamu state that they stopped
using Synaptic as their IONM service provider and started using Traxx due to their dissatisfaction
with Synaptic’s services and not due to “anything [Nallia or Villalobos] said or did.” Similarly,
Dr. Peterson states in his affidavit that he stopped using Synaptic and started using Traxx for
IONM services because of his long-standing friendship with Bouillion. The Defendants reason
that this evidence conclusively establishes that Synaptic did not lose the business of these three
doctors due to any action by Nallia or Villalobos and that Synaptic did not present any other
evidence of damages. Second, with respect to Dr. Yankov, the Defendants point to Cobb’s
affidavit and, more specifically, to Cobb’s statement that Dr. Yankov never worked for Traxx.
24
According to the Defendants, this statement conclusively negates Synaptic’s theory that the
Defendants’ wrongful conduct caused Dr. Yankov to terminate his relationship with Synaptic.
Finally, the Defendants assert that Synaptic was not harmed by any effort taken by the Defendants
to obtain Lauren Baker as an employee because, according to Baker’s affidavit, she received
Synaptic’s verbal offer of employment a week after she had accepted Traxx’s offer and, even if
Traxx had not made an employment offer, she would not have accepted Synaptic’s offer. In her
affidavit, Baker explains that she “did not get a good feeling from the interview and [from] other
conversations with Jon Schiff of Synaptic.”
“Evidence is conclusive only if reasonable people could not differ in their
conclusions, a matter that depends on the facts of each case.” City of Keller v. Wilson, 168 S.W.3d
802, 806 (Tex. 2005). Most often, contrary evidence becomes conclusive when it concerns
physical facts that cannot be denied or when an opposing party admits the fact is true. Id. at 815.
Because jurors may believe or disbelieve witness testimony—even uncontradicted, unimpeached
testimony from disinterested witnesses—testimonial evidence, often, is not conclusive. See id. at
816, 820. At this early stage of the proceedings, we cannot conclude that the affidavits
submitted by the Defendants for the purpose of establishing the subjective motivations of the
nonparty affiants must be given conclusive effect. See Warner Bros. Entm’t, 538 S.W.3d at 801
(prima facie case can only be rebutted by conclusive evidence).
Viewing the evidence in the light most favorable to Synaptic, we conclude that
Synaptic has met its burden to establish, by clear and convincing evidence, a prima facie case for
its claims against Nallia, Villalobos, and the Traxx Defendants. The trial court erred in granting
the motion to dismiss.
25
CONCLUSION
We reverse the judgment of the trial court dismissing Synaptic’s claims and
remand the cause for further proceedings consistent with this opinion.
__________________________________________
Chari L. Kelly, Justice
Before Chief Justice Rose, Justices Kelly and Smith
Reversed and Remanded
Filed: September 6, 2019
26