Iron Tigga, LLC and Abraham Quintanilla III v. Law Offices of David W. Showalter, LLP ( 2022 )

NUMBER 13-21-00459-CV
COURT OF APPEALS
THIRTEENTH DISTRICT OF TEXAS
CORPUS CHRISTI – EDINBURG
IRON TIGGA, LLC AND
ABRAHAM QUINTANILLA III, Appellants,
v.
LAW OFFICES OF
DAVID W. SHOWALTER, LLP, Appellee.
On appeal from the 148th District Court
of Nueces County, Texas.
MEMORANDUM OPINION
Before Justices Longoria, Hinojosa, and Silva
Memorandum Opinion by Justice Longoria
Appellants Iron Tigga, LLC and Abraham “A.B.” Quintanilla III appeal the trial
court’s denial of their motion to dismiss a suit brought by appellee Law Offices of David
W. Showalter, LLP (Showalter) concerning the payment of certain legal fees. By five
issues, appellants contend that Showalter’s claims should have been dismissed under
the Texas Citizens Participation Act (TCPA). Because we agree, we reverse and remand.
I. BACKGROUND
A. 2007 Suit and Post-Judgment Proceedings
Quintanilla, Andrew Maes, Alex Ramirez, and Alex’s brother Rolando Ramirez
were members of the “Kumbia Kings,” a popular music group formed in the late 1990s. In
2007, Maes and the Ramirez brothers sued Quintanilla 1 for breach of contract, breach of
fiduciary duty, and fraud, alleging that they were each entitled to a portion of the profits
earned by the group from its founding until 2003 (the underlying suit or 2007 suit). After
a bench trial in November of 2012, the 319th District Court found against Maes but in
favor of the Ramirezes, awarding each brother $393,266 in damages, plus pre- and post-
judgment interest. See Maes v. Quintanilla, No. 13-13-00005-CV, 2015 WL 1957548, at
*3 (Tex. App.—Corpus Christi–Edinburg Apr. 30, 2015, pet. denied) (mem. op.) (affirming
judgment).
Showalter represented all three plaintiffs in the 2007 suit. At the 2012 bench trial,
he testified that $65,000 was a reasonable and customary fee for the services his firm
had provided “through trial and post[-]trial motions,” that $18,000 would be a reasonable
fee in the event of an appeal to this Court, and that $20,000 would be a reasonable fee
in the event of an appeal to the Texas Supreme Court. Showalter further testified that the
three plaintiffs had entered into a contingent fee agreement with him and that “another
reasonable way to calculate attorney’s fees is 40 percent of the amount recovered; and if
there’s an appeal, an extra five percent.” Ultimately, in addition to damages, the
1The 2007 suit was brought against appellants Quintanilla and Iron Tigga, LLC, Quintanilla’s solely-
owned company. Both Iron Tigga, LLC, and Quintanilla were named as defendants in the instant suit and
both are parties to this appeal. We refer to appellants collectively as Quintanilla.
2
November 2012 final judgment awarded the Ramirez brothers “[r]easonable and
necessary attorney’s fees in the amount of $65,000,” plus conditional appellate fees in
the amounts of $18,000 and $20,000, in accordance with Showalter’s testimony. 2
Showalter continued to represent the Ramirez brothers in post-judgment
proceedings and collection efforts. In 2013, he successfully sought an order in bankruptcy
court declaring that the 2012 judgment debt was not dischargeable by Quintanilla. And in
2016, pursuant to a motion filed by Showalter on behalf of the Ramirezes, the trial court
appointed a receiver “with the power and authority to take possession of all leviable
property of” Quintanilla. See TEX. CIV. PRAC. & REM. CODE ANN. § 31.002(b)(3) (stating
that a court may “appoint a receiver with the authority to take possession of [a judgment
debtor’s] nonexempt property, sell it, and pay the proceeds to the judgment creditor to the
extent required to satisfy the judgment”).
At some point in 2018, the Ramirez brothers hired attorneys Bianca Medina and
Kim Frost to represent them. On October 30, 2018, Medina and Frost, on behalf of the
Ramirezes, applied to 319th District Court for a writ of garnishment to be directed to
Quintanilla’s father, Abraham Quintanilla Jr. (Abraham). The application alleged that
Quintanilla does not possess property in Texas subject to execution sufficient to satisfy
the judgment, but that Abraham “is indebted to [Quintanilla] by reason of a contractual
relationship which exists between [Abraham] and [Quintanilla].” The court granted the
request and the Nueces County Clerk issued the writ, which forbade Abraham from
paying any debt he owed to Quintanilla pending further order of the court.
2 According to an Abstract of Judgment issued by the Nueces County Clerk on January 4, 2018,
the total amount owed by Quintanilla under the November 2012 judgment as of that date, including interest,
was $1,082,753.82.
3
B. Instant Suit
On June 3, 2021, Showalter filed the instant suit in the 148th District Court against
Quintanilla and the Ramirez brothers, alleging that the Ramirezes, “in coordination with
all Defendants, fired [Showalter] immediately before an out-of-court settlement and have
since refused to pay the legal fees owed under the contract.” The suit asserted a claim
for breach of contract against the Ramirez brothers, pointing to the following provision
contained in a fee agreement signed in 2006 by Showalter and both Ramirezes:
ln consideration of the services rendered and to be rendered by our
attorneys in the prosecution of our said claim for damages [against
Quintanilla], [w]e here and now set over and assign to our said attorneys a
33-1/3% interest in our said causes of action in the event settlement is made
before suit is filed; and a 40% interest in the event suit is filed and/or tried
and settlement is made or judgment paid without an appeal; and a 45%
interest in the event suit is appealed to the appellate courts.
Showalter further asserted that Quintanilla intentionally interfered with this fee agreement
“by offering a covert settlement with the Ramirez Defendants outside of court in which
[Showalter] received no notification of the same, and consequently, no compensation for
his efforts in the underlying lawsuit.” Showalter alleged that “[a]fter nearly a decade of
litigation, [Quintanilla] knew or had reason to know of [Showalter]’s contract with the
Ramirez Defendants.” Finally, Showalter claimed that Quintanilla engaged in a civil
conspiracy with the Ramirez brothers to “unlawfully deprive [him] of his 45% ownership
of settlement proceeds.”
C. TCPA Motion to Dismiss
On August 25, 2021, Quintanilla filed a motion to dismiss Showalter’s suit pursuant
to the TCPA, contending that the suit is based on or in response to Quintanilla’s exercise
of the right of petition and that Showalter cannot produce clear and specific evidence to
support his claims. See TEX. CIV. PRAC. & REM. CODE ANN. § 27.005(a). Specifically, the
4
motion alleged that the TCPA applied to Showalter’s suit because the claims raised
therein implicated Quintanilla’s “making or submitting of communications in the form of
written statements, case filings, settlement agreements and other documents in or
pertaining to judicial proceedings.” See id. § 27.001(4)(A)(i).
The motion acknowledged that on June 26, 2019, both Abraham and Quintanilla
entered into a “Full and Final Settlement and Release Agreement and Confidentiality
Agreement” with the Ramirez brothers which settled all of the claims made in the 2007
lawsuit (and adjudicated in the 2012 judgment) as well as in the 2018 writ of garnishment
proceeding. The motion stated that, pursuant to the settlement agreement, a check for
$750,000 was delivered to Medina, and the Ramirezes filed an agreed motion to vacate
the writ of garnishment and released all of their claims. 3 The motion argued, however,
that the settlement was not “covert,” as Showalter alleged, because it arose out of “public
judicial proceedings” which were “pending . . . at the time of the settlement.” The motion
further observed that, in section D.2 of the settlement agreement, the Ramirez brothers
expressly represented as follows:
Plaintiffs, [the Ramirez brothers], warrant and represent that Plaintiffs, [the
Ramirez brothers], have not assigned, authorized or transferred (in any
way, whether directly or indirectly) any claims, demands, suits, causes of
action, charges, or grievances of any kind or character, which Plaintiffs, [the
Ramirez brothers], had or may have had prior to and including the Effective
Date against Defendant, [Abraham], and/or Debtor/Defendant, [Quintanilla].
3 The motion to dismiss further noted that, on January 11, 2021, Medina filed an interpleader in the
underlying suit in which she sought permission to deposit $65,000 in the registry of the court. The
interpleader stated that $32,500 “was held from the settlement proceeds” as to each Ramirez brother
“based on an alleged claim to the funds” by Showalter, but that each brother had directed Medina “not to
tender any of the funds” to Showalter. Medina stated in the interpleader that she “has no claim or any
interest” in those funds. The motion to dismiss also noted that, on March 4, 2021, Abraham filed a plea in
intervention in the underlying 2007 suit “to assert his interest in protecting the confidentiality of the
[settlement agreement] and in preventing its release to non-parties with no interest in its content, or with
adverse interests to [Abraham].” Copies of Medina’s interpleader and Abraham’s plea in intervention were
attached to the motion to dismiss.
5
The TCPA motion to dismiss was accompanied by several pieces of evidence,
including an affidavit by Quintanilla supporting the allegations made in the motion. In the
affidavit, Quintanilla denied that he ever knew of, or interfered with, any contract between
the Ramirezes and Showalter. He stated that he had not communicated directly with the
Ramirez brothers in over nine years, and that he had never communicated directly with
Medina or Frost. He averred that “[a]ny and all settlement communications . . . were
handled by my attorney at the time.” Also attached to the motion to dismiss was a sealed
copy of the settlement agreement between Quintanilla and the Ramirezes.
Showalter filed a response to the motion to dismiss contending that the TCPA does
not apply to his suit because (1) it is based on Quintanilla’s “conduct” rather than a
“communication,” and (2) any “communications that may be theoretically encompassed
by [his] lawsuit” were made “outside of any judicial proceeding.” Showalter’s response
further argued that, even if the TCPA applied to his claims, he produced clear and specific
evidence of a prima facie case for each of his causes of action. He included an affidavit
in which he averred that he “first became aware of being discharged” as counsel for the
Ramirez brothers “in June and July, 2019.” He stated that he did not learn of the
settlement agreement until October 28, 2020, when he received a letter from an attorney
representing Medina. Showalter also averred as follows:
As a result of the secretive nature of the settlement while I was still the
attorney of record for the Ramirez [b]rothers, the amount of the judgment
was significantly compromised and reduced. Even at the reduced amount,
and due to the secretive nature of the settlement, I was not informed and
therefore did not receive my the 45% [sic] of the judgment I was entitled to
under the contract. This is true despite the ten years spent litigating this
case on a contingent fee contract. To date, I have not received any money
in exchange for my efforts in the underlying lawsuit. . . .
I believe my aggressive pursuit of the judgment informs that the settlement
with the Ramirez [b]rothers was entered into behind my back because
6
[Quintanilla] knew I would never advise my clients to resolve their case for
anything less than the full amount of the judgment. I engaged in aggressive
post[-]judgment discovery upon the assets of [Quintanilla], clearly putting
them on notice and giving them the motivation to avoid me in settling the
case. . . .
The settlement agreement reached in the underlying suit was reached
without my knowledge and without the knowledge and approval of the
receiver . . . . The receiver would never have consented to a settlement of
this kind. Had the settlement been reached without the tortious interference
of the contract, I would have required and secured the full amount of the
judgment by collection and I would have taken 45% of the same as required
under the contract along with expenses.
Quintanilla filed a reply in which he argued that his entrance into the settlement
agreement and payment to the Ramirez brothers “cannot be the proximate cause of the
Ramirez [b]rothers’·subsequent alleged breach and purported failure to pay [Showalter
his] contingency fee.” Showalter filed a sur-reply in which he argued that Quintanilla’s
actions were, in fact, a proximate cause of his injury because Quintanilla was obliged “to
distribute funds through the receivership” according to the order appointing the receiver,
which stated in relevant part:
It is further ORDERED that [Quintanilla] continue, until the judgment in this
cause is fully paid, to turn over to Receiver at Receiver’s address all checks,
cash, securities, promissory notes, documents of title, and contracts within
three days of [Quintanilla’s] receipt and possession of such property if, as,
and when [Quintanilla] come[s] into receipt and possession of any such
property.[ 4]
Quintanilla asserted in a sur-response that the receiver’s authority was “clearly limited to
the assets of [Quintanilla],” not his debts, and “the consideration used to settle the
4 Showalter attached to his sur-reply an affidavit by the receiver attesting that he sent notice of his
appointment and a copy of the order appointing him to Quintanilla and that Quintanilla signed the return
receipt. The receiver stated that, to his knowledge, the receivership was never terminated. However, the
trial court sustained Quintanilla’s objections to the receiver’s affidavit on the basis that it was not timely
filed, and Showalter does not challenge that ruling on appeal. Therefore, we do not consider the receiver’s
affidavit in our analysis.
7
judgment did not come from assets of [Quintanilla],” but rather came from Abraham.
Quintanilla further argued that the receivership had been rendered moot because the
2012 judgment was satisfied.
At a hearing on November 19, 2021, the trial court heard argument on the motion
to dismiss. Quintanilla’s counsel stated that Abraham funded the settlement payment, on
behalf of himself and his son, in order to extinguish the writ of garnishment. Quintanilla’s
counsel further stated that the settlement agreement was reached only after Showalter
had been discharged as the Ramirez brothers’ counsel. Showalter’s counsel disagreed
and claimed that, in fact, Showalter “did not get discharged until the settlement
happened.” According to counsel, “[o]n the date of the settlement [Showalter] received
correspondence from the Ramirezes discharging him”; however, Showalter was not
informed of the existence of the settlement agreement until Medina contacted him in late
2020, and he was not aware of the amount of the settlement payment until he filed the
instant suit. 5 Showalter’s counsel conceded that, when the settlement was approved by
the 319th District Court, “the receivership would have been terminated.”
The trial court denied Quintanilla’s motion to dismiss by written order dated
December 7, 2021, and this interlocutory appeal followed. See TEX. CIV. PRAC. & REM.
CODE ANN. § 51.014(a)(12). 6
5After the hearing but before the court’s ruling, Showalter filed an amended petition adding Medina
as a defendant.
6 On February 2, 2022, after the appeal was perfected but prior to the filing of briefs, Quintanilla’s
appellate counsel filed an affidavit with the trial court attesting that the presiding judge sent emails to the
attorneys dated November 22, December 1, and December 7, 2021, and including copies of those emails.
In the emails, the trial judge stated that he found Honeycutt v. Billingsley, 992 S.W.2d 570, 576 (Tex. App.—
Houston [1st Dist.] 1999, pet. denied)—a case cited by Showalter—to be “instructive,” and that he would
be denying the TCPA motion to dismiss. The emails further stated as follows:
Both the Berry [v. Nueces County, No. 13-05-383-CV, 2006 WL 1280901, at *1 (Tex.
App.—Corpus Christi–Edinburg May 11, 2006, pet. denied) (mem. op.)] and Raub [v. Gate
8
II. DISCUSSION
Quintanilla presents five issues on appeal, all of which challenge the trial court’s
denial of his TCPA motion to dismiss. 7 We address the issues together.
A. Applicable Law and Standard of Review
The TCPA “protects citizens from retaliatory lawsuits that seek to intimidate or
silence them on matters of public concern.” In re Lipsky, 460 S.W.3d 579, 586 (Tex. 2015)
Guard Services, L.P., No. 13-15-00097-CV, 2017 WL 2570042, at *1 (Tex. App.—Corpus
Christi–Edinburg Mar. 30, 2017, no pet.) (mem. op.)] cases leave open the issue of “a case
in which the parties themselves arrange a secret settlement in order to defraud their own
attorneys.” . . . [T]he function of discovery is to flesh out the details of such allegations, if
any. Likewise, if the discovery process reflects no evidence of fraud, the matter may be
revisited.
Pursuant to Quintanilla’s request, the appellate record was supplemented to include counsel’s affidavit and
the accompanying emails.
In his brief, Showalter argues that we should not consider the emails because they are not properly
part of the record. We assume, but do not decide, that the emails are not properly part of the appellate
record, and we do not consider them in our analysis.
7 The issues are presented as follows in Quintanilla’s brief:
1. Whether the trial court committed reversible error when it denied [Quintanilla’s]
TCPA Motion to Dismiss relying solely on [Honeycutt] . . . and did not follow the
holdings in [Berry] and [Raub].
2. Whether the trial court committed reversible error in holding that because [sic], in
theory, a settling defendant may be liable to the former counsel of the settling
plaintiff if there is evidence “the parties themselves arrang[ed] a secret settlement
in order to defraud their own attorneys” and by then seemingly finding that
[Quintanilla] entered into a “secret settlement” despite there being no evidence
submitted by Showalter of any “secret settlement.”
3. Whether the trial court committed reversible error in denying [Quintanilla’s] TCPA
motion because discovery might reveal evidence of a “secret settlement” or other
facts providing prima facie evidence of each element of Showalter’s causes of
action.
4. Whether the trial court committed reversible error by failing to analyze whether
[Quintanilla’s] affirmative defense of justification compelled dismissal of
Showalter’s claims.
....
[5.] Whether in the absence of clear and specific evidence establishing a prima facie
case for each element of Appellee’s claims against [Quintanilla], it was error for
the trial court to deny the TCPA Motion to Dismiss and to refuse to award
[Quintanilla his] attorneys’ fees and expenses.
The analysis and arguments in the brief do not correspond to the issues presented. We will endeavor to
address every issue fairly raised, supported by argument, and necessary to the disposition of the appeal.
9
(orig. proceeding). A party seeking dismissal under the TCPA has the initial burden to
show that “the legal action is based on or is in response to . . . the party’s exercise of: (A)
the right of free speech; (B) the right to petition; or (C) the right of association.” TEX. CIV.
PRAC. & REM. CODE ANN. § 27.005(b)(1). If the movant meets its initial burden, then the
plaintiff must establish by “clear and specific evidence a prima facie case for each
essential element of the claim in question” to avoid dismissal. Id. § 27.005(c). Even if the
plaintiff makes this showing, the trial court must nevertheless dismiss the action “if the
moving party establishes an affirmative defense or other grounds on which the moving
party is entitled to judgment as a matter of law.” Id. § 27.005(d).
Our review of a ruling on a TCPA motion to dismiss is de novo. Entravision
Commc’ns Corp. v. Salinas, 487 S.W.3d 276, 281 (Tex. App.—Corpus Christi–Edinburg
2016, pet. denied); Hicks v. Grp. & Pension Adm’rs, Inc., 473 S.W.3d 518, 526 (Tex.
App.—Corpus Christi–Edinburg 2015, no pet.).
B. Exercise of Right to Petition
We first address whether the TCPA applies to the claims at issue. Quintanilla
alleged that Showalter’s claims against him were “based on or . . . in response to” his
exercise of the right to petition. See TEX. CIV. PRAC. & REM. CODE ANN. § 27.005(b)(1)(B).
“Exercise of the right to petition” is defined in the statute as, among other things, “a
communication in or pertaining to . . . a judicial proceeding.” Id. § 27.001(4)(A)(i). Courts
have held that, in this context, a “judicial proceeding” must be “actual” and “pending.”
Long Canyon Phase II & III Homeowners Ass’n v. Cashion, 517 S.W.3d 212, 220 (Tex.
App.—Austin 2017, no pet.); Levatino v. Apple Tree Cafe Touring, Inc., 486 S.W.3d 724,
728 (Tex. App.—Dallas 2016, pet. denied). “‘Communication’ includes the making or
10
submitting of a statement or document in any form or medium, including oral, visual,
written, audiovisual, or electronic.” Id. § 27.001(1); see Adams v. Starside Custom
Builders, LLC, 547 S.W.3d 890, 894 (Tex. 2018) (“Almost every imaginable form of
communication, in any medium, is covered.”). “Pertain” is not defined in the statute but
may mean “to relate directly to; to concern or have to do with.” BLACK’S LAW DICTIONARY
(11th ed. 2019).
As noted above, Showalter’s live petition at the time of the hearing alleged that
Quintanilla interfered with his fee agreement with the Ramirez brothers “by offering a
covert settlement” to the Ramirezes without notifying Showalter and without
“compensat[ing him] for his efforts in the underlying lawsuit.” 8 Showalter further alleged
that, “[t]o accomplish the object of their agreement, Defendants confidentially exchanged
money or property to satisfy the underlying judgment and intentionally acted to conceal
the effects of their actions from [Showalter].” Showalter concedes that “almost any kind
of statement made by a lawyer to a court during a lawsuit” would qualify as an “exercise
of the right to petition” under the statute, but he contends that “[a]ny communications
made in connection with” the settlement negotiations here “were not made as part of or
in connection with any judicial proceeding, but rather in the course of cutting a secret,
back-room deal.” He asserts that “[a] person cannot render their wrongdoing immune from
judicial review merely by mentioning it to a court, after the fact.”
We find that the broad statutory language encompasses Showalter’s claims
against Quintanilla. It is undisputed that the 2019 agreement was signed by Abraham,
8 In his amended petition, Showalter additionally argued that Quintanilla was “aware that the 319th
District Court had appointed a receiver over all of the [Ramirezes’] assets. Nevertheless, all of the
Defendants acted in derogation of that court order and the authority of the receiver.”
11
Quintanilla, and the Ramirez brothers, and that it settled claims which were then pending
in actual, ongoing judicial proceedings. It is also undisputed that the settlement
agreement was reviewed and approved of by the presiding judge of the 319th District
Court. Thus, the settlement agreement constituted a “communication in a judicial
proceeding.” See TEX. CIV. PRAC. & REM. CODE ANN. § 27.001(4)(A)(i). Showalter
emphasizes that Abraham sought to ensure the confidentiality of the agreement, and he
notes that the agreement was initially filed under seal. 9 But the definition of
“communication” in the TCPA does not require that the statement or document at issue
be made or submitted publicly. Under the very broad statutory language, even a “secret,
back-room deal” may constitute an “exercise of the right to petition” if it is filed with the
court in an active proceeding. See id.
On appeal, Showalter contends that there “must also be more than a tangential
connection between the claim being made and the communication.” He cites Winstead
PC v. Moore, in which the Dallas Court of Appeals held that the TCPA did not apply to a
claim based on alleged misrepresentations made by a law firm to the plaintiff that the firm
“had met its legal standard of care in preparing” certain documents for submission to the
Securities and Exchange Commission (SEC). 633 S.W.3d 200, 204 (Tex. App.—Dallas
2021, pet. filed). The court held that the alleged misrepresentations were “too remote from
the SEC’s review of those documents to constitute ‘communication[s] in connection with
an issue under consideration or review by a . . . governmental body.’” Id. (applying TEX.
CIV. PRAC. & REM. CODE ANN. § 27.001(4)(B) (stating that “exercise of the right to petition”
includes “a communication in connection with an issue under consideration or review by
9 The agreement was later unsealed and filed with the trial court in the instant suit.
12
a . . . governmental body”)). Here, the relationship between the settlement negotiations
and agreement and the judicial proceedings which it settled was more than merely
tangential. At the very least, the settlement negotiations and agreement between
Quintanilla and the Ramirezes constitute “communications . . . pertaining to” the pending
judicial proceedings. See TEX. CIV. PRAC. & REM. CODE ANN. § 27.001(4)(A)(i); see also
Jetall Cos. v. Johanson, No. 01-19-00305-CV, 2020 WL 6435778, at *3 (Tex. App.—
Houston [1st Dist.] Nov. 3, 2020, no pet.) (mem. op.) (concluding that communications
which “culminated in the execution of” a written settlement agreement “pertain[ed] to” the
lawsuit which the agreement settled).
Showalter’s claims against Quintanilla are “based on or . . . in response to” “a
communication in or pertaining to . . . a judicial proceeding.” See TEX. CIV. PRAC. & REM.
CODE ANN. §§ 27.001(4)(A)(i), 27.005(b)(1)(B). Therefore, the TCPA applies.
C. Clear and Specific Evidence of Prima Facie Case
Having concluded that the TCPA applies to the claims at issue, we proceed to
consider whether Showalter produced clear and specific evidence to establish a prima
facie case as to each element of those claims. A “prima facie case,” as used in the TCPA,
means “evidence that is legally sufficient to establish a claim as factually true if it is not
countered.” S & S Emergency Training Sols., Inc. v. Elliott, 564 S.W.3d 843, 847 (Tex.
2018). It represents the “minimum quantity of evidence necessary to support a rational
inference that the allegation of fact is true.” KTRK Television, Inc. v. Robinson, 409
S.W.3d 682, 688 (Tex. App.—Houston [1st Dist.] 2013, pet. denied). In the context of the
TCPA, “clear” has been interpreted to mean “unambiguous,” “sure,” or “free from doubt,”
while “specific” has been interpreted to mean “explicit” or “relating to a particular named
13
thing.” In re Lipsky, 460 S.W.3d at 590.
Against Quintanilla, Showalter asserted claims of tortious interference with an
existing contract and civil conspiracy. The essential elements of a tortious interference
claim are: (1) the existence of a valid contract subject to interference; (2) the defendant
willfully and intentionally interfered with the contract; (3) the interference proximately
caused the plaintiff’s injury; and (4) the plaintiff incurred actual damage or loss. Cmty.
Health Sys. Prof’l Servs. Corp. v. Hansen, 525 S.W.3d 671, 689 (Tex. 2017) (citing
Butnaru v. Ford Motor Co., 84 S.W.3d 198, 207 (Tex. 2002)). To establish a civil
conspiracy claim, a plaintiff must establish that: (1) a combination of two or more persons;
(2) sought to accomplish an object or course of action; (3) reached a meeting of the minds
on the object or course of action; and (4) took one or more unlawful, overt acts in
pursuance of the object or course of action; (5) which proximately caused damages. First
United Pentecostal Church of Beaumont v. Parker, 514 S.W.3d 214, 222 (Tex. 2017).
As noted, Showalter stated in his affidavit that Quintanilla knew of his contingency
fee arrangement with the Ramirezes because Quintanilla was present at the 2012 trial,
during which Showalter offered testimony to that effect. On appeal, Showalter cites
Honeycutt v. Billingsley, among other cases, for the proposition that “a lawyer [may]
recover when a case in which he had a contingent fee interest was settled behind his
back without his knowledge, by parties who were aware of his interest.” 992 S.W.2d 570(Tex. App.—Houston [1st Dist.] 1999, pet. denied); see Seiter v. Marschall, 147 S.W. 226,
228–29 (Tex. 1912); Galveston, Harrisburg & San Antonio Ry. Co. v. Ginther, 72 S.W.
166, 167 (Tex. 1903); Travelers Fire Ins. v. Steinmann, 276 S.W.2d 849, 851 (Tex. App.—
Dallas 1955, writ ref’d n.r.e.); Groves-Barnes Lumber Co. v. Freeman, 33 S.W.2d 218,
14
219 (Tex. App.—Texarkana 1930, no writ); see also Hagood v. Madhavan Pisharodi,
M.D., P.A., No. 13-17-00672-CV, 2019 WL 6795869, at *4 (Tex. App.—Corpus Christi-
Edinburg Dec. 12, 2019, no pet.) (mem. op.); GEICO Choice Ins. v. Stern, No. 01-18-
00013-CV, 2019 WL 3819518, at *4 (Tex. App.—Houston [1st Dist.] Aug. 15, 2019, no
pet.) (mem. op.); Mallory v. Arctic Pipe Inspection Co., No. 01-12-00979-CV, 2014 WL
701123, at *5 (Tex. App.—Houston [1st Dist.] Feb. 20, 2014, pet. denied) (mem. op.).
In Honeycutt, a woman was injured in a car accident and signed a contract with
attorney Billingsley to represent her in a suit arising out of the accident. 992 S.W.2d at
573. The contract stated that, as compensation, Honeycutt would assign to Billingsley “an
undivided interest in her claim” of “40% if a collection or settlement was made after suit
was filed.” Id. The contract also stated that neither the client nor the attorney was to make
a settlement without the other’s consent. Id. Later, the parties signed an agreement
referring Honeycutt’s claims from Billingsley to another attorney, Jensen. Id. at 574. The
referral agreement stated that Billingsley was entitled to forty percent of the fees to which
he was entitled under the original agreement and that Jensen was entitled to sixty percent.
Id. at 575. The following year, Jensen withdrew from the case and Honeycutt retained
new counsel without a referral agreement, but she did not advise Billingsley. Id. Billingsley
later intervened in Honeycutt’s case, asserting that he had a forty percent interest in her
claim under the original agreement. Id. The jury found that Honeycutt failed to comply
with the original fee agreement and that Billingsley was entitled to $13,000 in damages.
Id. at 576. The First Court of Appeals held that there was legally and factually sufficient
evidence to support the jury’s findings that the affirmative defenses of novation and
accord and satisfaction did not excuse Honeycutt’s breach of contract. Id. at 577–80
15
(noting that Billingsley was the “only attorney ever given an express assignment” of
Honeycutt’s claim, and that he testified the referral agreement “was not intended to
discharge the contingency fee agreement”).
Honeycutt is distinguishable. First, there is no indication that Showalter and the
Ramirez brothers agreed, as part of their fee arrangement, that neither party was to make
a settlement without the other’s consent. Second, and more importantly, the question at
issue in Honeycutt was whether the attorney, Billingsley, could recover against his former
client, Honeycutt, who was a party to the contingency fee agreement. Thus, to the extent
that Honeycutt holds “a lawyer [may] recover when a case in which he had a contingent
fee interest was settled behind his back without his knowledge,” it holds only that the
attorney may recover from the former client in that situation. It does not establish that the
attorney may recover his fees from the defendant in the lawsuit when that defendant
settles its claims with the attorney’s former client, regardless of whether the defendant
knew of the contingency fee arrangement.
In Texas, a lawyer’s rights based on a contingent fee contract are “wholly derivative
from those of his client.” Dow Chem. Co. v. Benton, 357 S.W.2d 565, 567 (Tex. 1962).
Thus, “if an attorney hired on a contingent-fee basis is discharged without cause before
the representation is completed, the attorney may seek compensation in quantum meruit
or in a suit to enforce the contract by collecting the fee from any damages the client
subsequently recovers.” Hoover Slovacek LLP v. Walton, 206 S.W.3d 557, 561 (Tex.
2006); see Mandell & Wright v. Thomas, 441 S.W.2d 841, 847 (Tex. 1969); Rocha v.
Ahmad, 676 S.W.2d 149, 156 (Tex. App.—San Antonio 1984, writ dism’d). But the party
against whom the attorney may sue for this breach is his former client, not the opposing
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party in the underlying litigation. See Mandell & Wright, 441 S.W.2d at 847 (allowing
attorney to sue client after termination); Law Offices of Windle Turley, P.C. v. Ghiasinejad,
109 S.W.3d 68, 70–71 (Tex. App.—Fort Worth 2003, no pet.); see also Raub v. Gate
Guard Servs., L.P., No. 13-15-00097-CV, 2017 WL 2570042 (Tex. App.—Corpus Christi–
Edinburg Mar. 30, 2017, no pet.) (mem. op.); Berry v. Nueces Cnty., No. 13-05-383-CV,
2006 WL 1280901 (Tex. App.—Corpus Christi–Edinburg May 11, 2006, pet. denied)
(mem. op.).
This Court has previously held in two memorandum opinions that an attorney
lacked standing to sue his former client’s adversary for contingency fees owed by the
former client. See Raub, 2017 WL 2570042, at *3; Berry, 2006 WL 1280901, at *3.
Showalter notes that, in both of those cases, we specifically distinguished the facts therein
from a hypothetical situation “in which the parties themselves arrange a secret settlement
in order to defraud their own attorneys.” Raub, 2017 WL 2570042, at *3; Berry, 2006 WL
1280901, at *3 (citing Ginther, 72 S.W. at 167). Showalter suggests that this is one of
those situations.
We disagree. Even assuming that a defendant could theoretically be liable to the
plaintiff’s former attorney by settling their case in certain circumstances, Showalter’s
evidence does not establish a prima facie case supporting that theory. Specifically, there
is no clear and specific evidence that Quintanilla sought to defraud Showalter by settling
his claims against the Ramirezes. Although Showalter testified at trial in the underlying
case that he had a contingency fee agreement with the Ramirezes, he did not testify that
the Ramirezes had assigned a portion of their claim to him. There is no evidence in the
record, clear and specific or otherwise, which would tend to establish that Quintanilla
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knew that Showalter owned an interest in the Ramirezes’ claim. To the contrary, the
Ramirez brothers explicitly affirmed in the settlement agreement that they had not
assigned any of the claims being settled to any other party.
Moreover, to prove the second element of a tortious interference claim, the
defendant must show that “the actor desires to cause the consequences of his act, or that
he believes that the consequences are substantially certain to result from it.” Cmty. Health
Sys. Prof’l Servs. Corp., 525 S.W.3d at 689 (quoting Sw. Bell Tel. Co. v. John Carlo Tex.,
Inc., 843 S.W.2d 470, 472 (Tex. 1992)). There is no evidence in the record, clear and
specific or otherwise, indicating that Quintanilla intended for the Ramirezes to dishonor
their contingency fee agreement with Showalter, or that Quintanilla believed the
Ramirezes were substantially likely to do so as a result of the settlement. Instead, the
record reflects that Quintanilla promptly paid the amount he owed under the settlement
agreement, which actually exceeded the principal amount of the damages awarded in the
2012 judgment.
For the foregoing reasons, we conclude Showalter failed to meet his burden to
produce clear and specific evidence supporting a prima facie case on his tortious
interference claim. Further, because Showalter’s civil conspiracy claim is dependent on
a finding that Quintanilla committed an “overt, unlawful” act by negotiating and entering
into a settlement agreement with the Ramirez brothers, we further conclude that
Showalter failed to meet his burden to produce clear and specific evidence supporting a
prima facie case on that claim. See First United Pentecostal Church of Beaumont, 514
S.W.3d at 222; see also Agar Corp. v. Electro Circuits Int’l, LLC, 580 S.W.3d 136, 140
(Tex. 2019) (noting that liability for civil conspiracy “depends on injury from the underlying
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tort, not the conspiracy itself”). We need not address whether Quintanilla established his
affirmative defenses. See TEX. CIV. PRAC. & REM. CODE ANN. § 27.005(d); TEX. R. APP. P.
47.1. Quintanilla’s issues on appeal are sustained.
III. CONCLUSION
We reverse the trial court’s judgment. The cause is remanded with instructions to
grant Quintanilla’s TCPA motion to dismiss; to award court costs and attorney’s fees to
Quintanilla, see TEX. CIV. PRAC. & REM. CODE ANN. § 27.009(a)(1); to consider whether to
award sanctions to Quintanilla, see id. § 27.009(a)(2); and for further proceedings
consistent with this opinion.
NORA LONGORIA
Justice
Delivered and filed on the
20th day of October, 2022.
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