TotalGen Services, LLC v. Thomassen Amcot International, LLC ( 2021 )

In the
Court of Appeals
Second Appellate District of Texas
at Fort Worth
___________________________
No. 02-20-00015-CV
___________________________
TOTALGEN SERVICES, LLC, Appellant
V.
THOMASSEN AMCOT INTERNATIONAL, LLC, Appellee
On Appeal from the 67th District Court
Tarrant County, Texas
Trial Court No. 067-310073-19
Before Sudderth, C.J.; Kerr and Birdwell, JJ.
Memorandum Opinion by Chief Justice Sudderth
MEMORANDUM OPINION
I. Introduction
This is yet another case involving the pre-2019 version of the Texas Citizens
Participation Act (TCPA)1 in which one party tries to shoehorn the other party’s
pleadings into the statute’s purview.
Appellee Thomassen Amcot International, LLC (TAI), a worldwide broker of
power-generating equipment, sued Appellant TotalGen Services, LLC for breach of
contract, alleging that TotalGen had deprived it of a $645,000 commission on a $3.4
million transaction involving the sale of a 2012 Solar Titan 130 Gas Turbine
Generator Package and a Deltak Heat Recovery System Generator.
According to TAI, it had entered into a “Mutual Confidentiality and
Equipment Sourcing Agreement” with TotalGen under which it had disclosed
proprietary and confidential information to TotalGen in brokering the sale of the two
pieces of equipment from MP Mine Operations, LLC to either TotalGen or
TotalGen’s customer, Siouxland Energy Cooperative. TAI alleged that the parties’
agreement had required TotalGen to obtain a nondisclosure agreement with a non-
circumvention provision from Siouxland before disclosing to Siouxland any
1
The TCPA’s recent amendments became effective September 1, 2019. See Act
of May 17, 2019, 86th Leg., R.S., ch. 378, §§ 1–12 (codified at Tex. Civ. Prac. & Rem.
Code Ann. §§ 27.001–.010). Because the instant lawsuit was filed on August 16, 2019,
it is governed by the pre-amendment version of the TCPA, and our citations refer to
that version.
2
information about the equipment (so that TAI could claim its commission) but
instead, once TotalGen obtained the proprietary and confidential information from
TAI, TotalGen had actively assisted Siouxland in buying the equipment directly from
MP.
TotalGen filed a motion to dismiss under the TCPA, stating that when TAI
alleged in its original petition that “TotalGen gave Siouxland all the information about
the Equipment” and “actively assisted Siouxland in purchasing the equipment directly
from MP,” TAI’s breach-of-contract claim was based on or in response to TotalGen’s
exercise of the right of free speech or right of association. See Tex. Civ. Prac. & Rem.
Code Ann. § 27.003. The trial court denied the motion.
In the first two of five issues in this accelerated interlocutory appeal, TotalGen
complains that the trial court erred by denying its motion. See id. §§ 27.008,
51.014(a)(12). And in its fifth issue, TotalGen asserts that the trial court erred by
awarding attorney’s fees to TAI.2 See id. § 27.009(b).
2
TotalGen acknowledges that any order other than the motion to dismiss
cannot be reviewed in the instant interlocutory appeal. Further, because of the
automatic stay of all other proceedings in the case that occurred when TotalGen filed
this interlocutory appeal, see Tex. Civ. Prac. & Rem. Code Ann. § 51.014(b), the trial
court has not yet issued an order awarding the attorney’s fees. However, in its order
denying TotalGen’s TCPA motion, the trial court made findings in support of an
award of attorney’s fees to TAI, and we have reviewed these in the interest of judicial
economy. See, e.g., Masterson v. Diocese of Nw. Tex., 422 S.W.3d 594, 609 (Tex. 2013)
(addressing arguments in advance of remand).
3
We disagree with TotalGen’s argument that the trial court erred by denying its
motion, but we conclude that there is no evidence to support the trial court’s
attorney’s-fee findings under Section 27.009(b). Accordingly, we affirm in part and
render in part, and we remand this case for further proceedings without reaching
TotalGen’s remaining two issues. See Tex. R. App. P. 47.1.
II. Discussion
As we have noted before, we review de novo a trial court’s ruling on a TCPA
motion. UATP Mgmt., LLC v. Leap of Faith Adventures, LLC, No. 02-19-00122-CV,
2020 WL 6066197, at *2 (Tex. App.—Fort Worth Oct. 15, 2020, pet. filed) (mem.
op.) (citing Beving v. Beadles, 563 S.W.3d 399, 404 (Tex. App.—Fort Worth 2018, pet.
denied)); PNC Inv. Co., v. Fiamma Statler, LP, No. 02-19-00037-CV, 2020 WL 5241190,
at *3 (Tex. App.—Fort Worth Sept. 3, 2020, no pet.) (mem. op.) (same).
As applicable here, the first step in the TCPA’s burden-shifting analysis is for
the defendant-movant to 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 the right of
free speech or the right of association. See Tex. Civ. Prac. & Rem. Code Ann.
§ 27.005(b); Ghrist v. MBH Real Estate LLC, No. 02-17-00411-CV, 2018 WL 3060331,
at *1 (Tex. App.—Fort Worth June 21, 2018, no pet.) (mem. op.). In determining
whether the TCPA applies, we initially look to the plaintiff’s allegations, Hersh v.
Tatum, 526 S.W.3d 462, 467 (Tex. 2017), as TotalGen did in its motion. When it is
clear from the plaintiff’s pleadings that the action is covered by the TCPA, the
4
defendant need show no more. Id. (“The basis of a legal action is not determined by
the defendant’s admissions or denials but by the plaintiff’s allegations.”). Only if the
movant satisfies its burden does the nonmovant, to avoid dismissal, have to establish
“by clear and specific evidence a prima facie case for each essential element of the
claim in question.”3 Tex. Civ. Prac. & Rem. Code Ann. § 27.005(c); Ghrist, 2018 WL
3060331, at *1.
As a reminder, the TCPA’s purpose is to encourage and safeguard “the
constitutional rights of persons to petition, speak freely, associate freely, and
otherwise participate in government to the maximum extent permitted by law” and, at
the same time, protect the rights of a person to file meritorious lawsuits for
demonstrable injury. Tex. Civ. Prac. & Rem. Code Ann. § 27.002; In re Lipsky, 460
S.W.3d 579, 589 (Tex. 2015) (orig. proceeding) (“The TCPA’s purpose is to identify
and summarily dispose of lawsuits designed only to chill First Amendment rights, not
to dismiss meritorious lawsuits.”). It “is a bulwark against retaliatory lawsuits meant
to intimidate or silence citizens on matters of public concern,” Dallas Morning News,
Inc. v. Hall, 579 S.W.3d 370, 376 (Tex. 2019), and its purpose of curbing strategic
3
There are three steps in TCPA’s burden-shifting analysis, see generally Beving, 563
S.W.3d at 404, but because we conclude that TotalGen failed to meet its burden on
the first step, we do not reach the nonmovant’s clear-and-specific-prima-facie burden
in the second step, in Section 27.005(c), or—if the second step is met—the movant’s
subsequent burden to establish by a preponderance of the evidence each essential
element of a valid defense to the nonmovant’s claim, in Section 27.005(d). See Tex. R.
App. P. 47.1.
5
lawsuits against public participation (SLAPP suits) through a summary process
involving judicial review of the pleadings and limited evidence, see Lipsky, 460 S.W.3d
at 589–90, “is not furthered by a construction finding a right of association based
simply on communications between parties with a shared interest in a private business
transaction.” Palladium Metal Recycling, LLC v. 5G Metals, Inc., No. 05-19-00482-CV,
2020 WL 4333538, at *5 (Tex. App.—Dallas July 28, 2020, no pet.) (mem. op.). It is
likewise not furthered by applying it to wholly private disputes affecting only the
fortunes of the private parties involved. See Creative Oil & Gas, LLC v. Lona Hills
Ranch, LLC, 591 S.W.3d 127, 135–37 (Tex. 2019). As we have previously noted, the
TCPA “is not a Swiss army knife, a tool always ready to obtain the early dismissal of
every objectionable case or controversy.” Beving, 563 S.W.3d at 408 n.8.
A. TCPA Right of Association
The right to associate is defined in the pre-2019 TCPA as “a communication[4]
between individuals who join together to collectively express, promote, pursue, or
4
A TCPA “communication” includes making or submitting a statement or
document in any form or medium, including oral, visual, written, audiovisual, or
electronic. Tex. Civ. Prac. & Rem. Code Ann. § 27.001(1). No one disputes that the
basis of TAI’s breach-of-contract claim involves a “communication.” See In re
IntelliCentrics, Inc., No. 02-18-00280-CV, 2018 WL 5289379, at *4 (Tex. App.—Fort
Worth Oct. 25, 2018, orig. proceeding) (mem. op.) (“After all, what breach of contract
action would not find its genesis in communication between the parties?”). But as we
noted in IntelliCentrics, there is a distinction between communications used as evidence
to support a claim for breach of contract (i.e., the parties’ sourcing agreement) and a
claim that is “based upon, relate[d] to, or [] in response to” that communication under
the TCPA. See id.6
defend common interests.” Garrison Inv. Grp. LP v. Lloyd Jones Capital, LLC, No. 02-
19-00115-CV, 2019 WL 5996979, at *6 (Tex. App.—Fort Worth Nov. 14, 2019, no
pet.) (mem. op.) (quoting Section 27.001(2)). An interest is “common” if it is “shared
by the public or at least a group.” Id. (quoting Kawcak v. Antero Res. Corp., 582 S.W.3d
566, 576 (Tex. App.—Fort Worth 2019, pet. denied)). But when a communication is
between private business parties on private business matters and does not involve any
public or citizen participation, it does not implicate the associational rights protected
by the TCPA. Id.; see Anders v. Oates, No. 02-19-00116-CV, 2020 WL 1809654, at *5
(Tex. App.—Fort Worth Apr. 9, 2020, no pet.) (mem. op.) (observing that allegations
of a fraudulent scheme to induce the sale of a business and the execution of a
promissory note do not fall under the TCPA); Newpark Mats & Integrated Servs., LLC v.
Cahoon Enters., LLC, 605 S.W.3d 671, 680 (Tex. App.—Houston [1st Dist.] 2020, no
pet.) (holding that “association” to form a competing business “is a private interest
that benefits only the private parties involved in the intended business venture” and
thus does not fall under TCPA); see also Farhat v. Wilson Scott, LLC, No. 02-19-00438-
CV, 2020 WL 1949624, at *3 (Tex. App.—Fort Worth Apr. 23, 2020, no pet.) (mem.
op.) (“[T]he common interest they joined together to pursue is not an interest that the
TCPA protects; the ‘common interest’ here is, allegedly, tortfeasors breaching
fiduciary duties and working together for their own personal benefit rather than an
interest common to the public or a larger group.”).
7
In its first issue, TotalGen argues that the trial court erred by concluding that
the breach-of-contract allegations in TAI’s original petition—that “TotalGen gave
Siouxland all the information about the Equipment” and “actively assisted Siouxland
in purchasing the Equipment directly from MP”—did not relate to TotalGen’s right
of association.5 TotalGen asserts that these complained-of communications were
group communications in the public marketplace for the sale and purchase of power
generators,6 that the communications were public because TotalGen had failed to
keep them private and confidential, and that TotalGen’s communications with
Siouxland and MP were made to collectively pursue the common interest of closing
on the sale of the subject power generators. TotalGen further asserts that “generating
power is of significant interest to the public” beyond the interests of the individuals
and companies involved in the transaction.
5
TotalGen relied solely on TAI’s original petition in its motion to dismiss, as its
counsel acknowledged at the hearing, stating, “Our motion raised the pleadings only.”
6
TotalGen also invites us to reconsider our analysis in Kawcak in light of a
dissenting opinion in Segundo Navarro Drilling Ltd. v. San Roman Ranch Mineral Partners,
Ltd., No. 04-19-00484-CV, 2020 WL 4808716, at *6–11 (Tex. App.—San Antonio
June 24, 2020, pet. denied) (op. on reh’g) (Chapa, J., dissenting). We note that the
majority in that case agreed with us, see id. at *4 (“We agree with Kawcak’s thorough
analysis.”), and we decline the invitation. See also Gaskamp v. WSP USA, Inc., 596
S.W.3d 457, 476 (Tex. App.—Houston [1st Dist.] 2020, pet. dism’d) (op. on en banc
reconsideration) (following Kawcak and concluding that “with respect to the pre-
amendment version of the TCPA, the proper definition of ‘common’ in the phrase
‘common interests’ is ‘of or relating to a community at large: public.’”).
8
But, as pointed out by TAI, the communications at issue involved nothing
more than an exclusively private, arm’s-length transaction between private parties
involving confidential and proprietary information about the seller and equipment.
TAI’s breach-of-contract claim is based on the disclosure of confidential information
in the sale of two specific pieces of equipment, and nothing in the alleged
communications addresses a public component or the bigger picture of power
generation generally, notwithstanding TAI’s self-description as a business that
conducts transactions worldwide. There is no allegation that TotalGen, Siouxland, or
MP joined together to collectively express, promote, pursue, or defend any public or
community interests with regard to the sale, cf. Tex. Civ. Prac. & Rem. Code Ann.
§ 27.001(2), and, contrary to TotalGen’s assertions, based on TAI’s original petition,
the information was not disclosed “publicly” to the general public marketplace for
generators but rather to an already interested and involved third-party, Siouxland.7
7
In its original petition, TAI alleged,
Pursuant to the Sourcing Agreement [with TotalGen], TAI disclosed to
TotalGen proprietary and confidential information regarding the
Equipment, including the then-current owner; the technical
specifications and scope of supply of the Equipment; and the
commercial terms on which the Equipment was available for purchase
from MP. . . . TotalGen gave Siouxland all the information about the
Equipment but failed to obtain [a non-disclosure agreement containing a
non-circumvention provision]. The Sourcing Agreement also required
TotalGen to prevent Siouxland from circumventing TAI. TotalGen
failed to do that, and actively assisted Siouxland in purchasing the
Equipment directly from MP, without providing for the payment of the
broker’s fee to TAI stipulated in the Sourcing Agreement.
9
Accordingly, because the communications at issue were between private
business parties on private business matters and did not involve any public aspect, the
communications did not implicate the associational rights protected by the TCPA,
and the trial court did not err by denying this portion of TotalGen’s motion. See
Garrison Inv. Grp. LP, 2019 WL 5996979, at *6; see also Ngo v. Ass’n of Woodwind Lakes
Homeowners, Inc., No. 01-18-00919-CV, 2020 WL 7391696, at *7 (Tex. App.—Houston
[1st Dist.] Dec. 17, 2020, no pet. h.) (holding that TCPA’s right of association was not
implicated in breach-of-contract dispute between HOA and homeowners); SSCP
Mgmt. Inc. v. Sutherland/Palumbo, LLC, No. 02-19-00254-CV, 2020 WL 7640150, at *5
(Tex. App.—Fort Worth Dec. 23, 2020, no pet. h.) (mem. op. on reh’g) (stating that,
with regard to breach-of-express-warranty claim and TCPA right of association, the
appellant did not establish that the TCPA applied when “[m]ost of these activities
relate[d] to the parties’ private business dealings that they engaged in for their own
personal profit and not to an interest shared by the public or a group” and the
appellants failed to establish that the express warranty was contained in marketing
materials or otherwise related to marketing materials); Segundo Navarro Drilling, Ltd., at
*4 (“Appellants have not explained how their right to ‘participate in government’ is
served by defining the word ‘common’ to include their private business interests.”).
We overrule TotalGen’s first issue.
10
B. TCPA Right of Free Speech
Under the TCPA, the “exercise of the right of free speech” is defined as “a
communication made in connection with a matter of public concern.” Tex. Civ. Prac.
& Rem. Code Ann. § 27.001(3). A “matter of public concern” includes an issue
related to (A) health or safety; (B) environmental, economic, or community well-
being; (C) the government; (D) a public office or public figure; or (E) a good, product,
or service in the marketplace.” Id. § 27.001(7). A communication made in connection
with a matter of public concern must have public relevance beyond the pecuniary
interests of the private parties involved: “A private contract dispute affecting only the
fortunes of the private parties involved is simply not a ‘matter of public concern’
under any tenable understanding of those words.” Creative Oil & Gas, LLC, 591
S.W.3d at 136–37; Anders, 2020 WL 1809654, at *7 (“Creative Oil & Gas makes clear
that to be a matter of public concern for purposes of the TCPA, the matter must
involve more than the private pecuniary interests of the parties.”). But because we
may not narrow the TCPA’s scope by ignoring its plain language, if an alleged
communication has even a tangential relationship to a matter of public concern, then
it meets the TCPA’s requirements, and as long as the communication involves a
public subject, it need not be made in a public form. ExxonMobil Pipeline Co. v.
Coleman, 512 S.W.3d 895, 900 (Tex. 2017) (per curiam); see Creative Oil & Gas, LLC,
591 S.W.3d at 135.
11
In its second issue, relying on the same allegations set out above, TotalGen
argues that the trial court erred by concluding that TotalGen’s right of free speech
was not implicated, contending that these were group communications in the public
marketplace for the sale and purchase of power generation equipment that TAI had
hoped to conduct privately and confidentially but that was instead sold and purchased
in the public marketplace. But as set out above in our association analysis, these
communications did not take place in the public marketplace; they were private
communications related to a purely private transaction. To wit, as pointed out by
TAI, as confidentiality within the transaction was the linchpin of the claim itself, the
communications were inherently not a matter of public concern, notwithstanding
TotalGen’s argument that “power-generating equipment” is “necessarily related to
‘environmental, economic, or community well-being.’” The allegations in TAI’s
original petition mention nothing about how the two pieces of equipment had or
would have any effect—environmental, economic, or communal—outside of the
private parties’ business relationship. See Creative Oil & Gas LLC, 591 S.W.3d at 136–
37; see also Goldberg v. EMR (USA Holdings) Inc., 594 S.W.3d 818, 830 (Tex. App.—
Dallas 2020, pet. denied) (op. on reh’g) (holding that private communications were
not related to a matter of public concern when they involved only private buy–sell
offers and did not mention the beneficial effects of recycling provided by the scrap-
metal industry); Farhat, 2020 WL 1949624, at *6 (“[C]ommunications are not on a
matter of public concern if the[y] . . . are private communications related to purely
12
private commercial business or transactions and, through those communications, the
defendants . . . misappropriate the plaintiff’s confidential information in order to
pursue the business or transaction.”). Cf. PNC Inv. Co., 2020 WL 5241190, at *5
(concluding that allegations fell under TCPA because they involved a matter of public
concern beyond the private parties’ pecuniary interests as, “at every level,” the
redevelopment project was “undergirded by the public fisc”); Nguyen v. ABLe
Commc’ns, Inc., No. 02-19-00069-CV, 2020 WL 2071757, at *5 (Tex. App.—Fort
Worth Apr. 30, 2020, no pet.) (mem. op.) (holding communications fell under the
TCPA when they were on an issue related to the government—DFW and its public
bidding process—involving concerns with public relevance beyond the private parties’
pecuniary interests); Rogers v. Soleil Chartered Bank, No. 02-19-00124-CV, 2019 WL
4686303, at *1 (Tex. App.—Fort Worth Sept. 26, 2019, no pet.) (mem. op.)
(describing the “routine [TCPA free-speech] scenario: one party is dissatisfied with
another’s services, the dissatisfied party posts negative information on the internet,
the service provider considers the posted statements defamatory and sues, and the
dissatisfied party (now the defendant) invokes the TCPA”). Accordingly, the trial
court likewise did not err by denying the motion on the free-speech ground, and we
overrule TotalGen’s second issue.
C. Attorney’s Fees
In its final issue, TotalGen argues that the trial court erred, as a matter of law,
by awarding attorney’s fees to TAI under Section 27.009(b) because its motion to
13
dismiss was not frivolous but rather based on both facts and law and was not “solely”
intended to delay. TotalGen points out that construction of the statute has “ebbed
and flowed” to the extent that “a construction one day of a word or phrase in the
TCPA could be correct on that day but wrong the next.” TAI responds that it proved
that TotalGen’s TCPA motion was both frivolous and intended solely for delay.
Under Section 27.009(b), “[i]f the court finds that a motion to dismiss filed
under this chapter is frivolous or solely intended to delay, the court may award court
costs and reasonable attorney’s fees to the responding party.” Tex. Civ. Prac. & Rem.
Code Ann. § 27.009(b) (emphasis added). Such an award is entirely discretionary if
the trial court finds that the motion is frivolous or solely intended to delay. Lei v. Nat.
Polymer Int’l Corp., 578 S.W.3d 706, 717 (Tex. App.—Dallas 2019, no pet.). “In the
absence of a finding that the motion to dismiss was ‘filed with the sole intention of
delaying the proceedings,’ ‘an award of attorneys’ fees is not authorized by the
statute.’” Stallion Oilfield Servs. Ltd. v. Gravity Oilfield Servs., LLC, 592 S.W.3d 205, 221–
23 (Tex. App.—Eastland 2019, pets. denied) (holding that there was no statutory basis
to support the award of attorney’s fees under Section 27.009(b) when the trial court
abused its discretion by determining that the motion was frivolous and “did not find
that the motion to dismiss was solely intended to delay” (emphasis added)); see Abatecola
v. 2 Savages Concrete Pumping, LLC, No. 14-17-00678-CV, 2018 WL 3118601, at *16
(Tex. App.—Houston [14th Dist.] June 26, 2018, pet. denied) (mem. op.) (“[T]he trial
court improperly ruled that 2 Savages and Lowry were entitled to attorney’s fees
14
without finding that the motion to dismiss was frivolous or was solely intended to
delay.”); see also Holland v. Wal-Mart Stores, Inc., 1 S.W.3d 91, 95 (Tex. 1999) (op. on
reh’g) (“We have consistently held that a prevailing party cannot recover attorney’s
fees from an opposing party unless permitted by statute or by contract between the
parties.”).
In its order denying TotalGen’s motion, the trial court stated,
[T]he Court considered . . . TotalGen[’s] . . . Motion to Dismiss Pursuant
to the [TCPA], . . . [TAI’s] Response thereto and Request for Attorney’s
Fees, as well as [TotalGen’s] Reply and [TAI’s] Surreply and Emergency
Motion to Strike Defendant’s Late-Filed Motion to Dismiss under
[TCPA], First Amended Answer, and Affidavit of R. Nick Cioll, as well
as additional briefing requested. After considering the Motion, the
response thereto, the pleadings, the evidence on file with the Court, and
the arguments of counsel, the Court finds that the Motion should be and
is hereby DENIED. The Court further finds that the Motion is frivolous,
intended for delay, and that [TAI]’s Counsel shall submit proof of
reasonable attorney’s fees by affidavit within five (5) business days of the
date of this order, at which time the Court will issue its final order
awarding attorneys’ fees pursuant to [Section] 27.009. [Emphasis
added.]
The trial court did not find that TotalGen’s motion was filed “solely” for delay as
required by the statute.8 See Tex. Civ. Prac. & Rem. Code Ann. § 27.009(b).
Accordingly, we sustain this portion of TotalGen’s final issue and turn to whether the
8
Because the trial court’s “delay” finding is insufficient as a matter of law, we
will not address TAI’s arguments that TotalGen used “procedural ambush tactics”
and “made the conscious decision to lie behind the log and assert evidence and
defense only days before the hearing” other than to note that e-filing permitted both
parties to file documents outside of standard court business hours, as well as, in TAI’s
case, minutes before the hearing.
15
attorney’s fee award can be salvaged on the basis of the trial court’s finding that the
motion was frivolous.
The TCPA does not define “frivolous,” but our sister courts that have
addressed the issue have noted that the “common understanding” of the word
“contemplates that a claim or motion will be considered frivolous if it has no basis in
law or fact and lacks a legal basis or legal merit.” Marrujo v. Wisenbaker Builder Servs.,
Inc., No. 01-19-00056-CV, 2020 WL 7062318, at *11 (Tex. App.—Houston [1st Dist.]
Dec. 3, 2020, no pet.) (mem. op.) (quoting Sullivan v. Tex. Ethics Comm’n, 551 S.W.3d
848, 857 (Tex. App.—Austin 2018, pet. denied), and citing Caliber Oil & Gas, LLC v.
Midland Visions 2000, 591 S.W.3d 226, 243 (Tex. App.—Eastland 2019, no pet.), and
Lei, 578 S.W.3d at 717, as following Sullivan). The fact that a TCPA motion to dismiss
is ultimately denied is not sufficient, standing alone, to support a finding that the
motion was frivolous. Id. at *12 (citing Caliber Oil, 591 S.W.3d at 244).
If there is at least a colorable basis for the TCPA motion, then it is not
frivolous. Id. In Marrujo, the appellee sued the appellants—a former employee and
her new employer—in August 2018 for violation of a non-compete agreement, raising
breach-of-contract and tortious interference claims, and the appellants filed a TCPA
motion to dismiss based on the exercise of the rights of free speech, association, and
petition. Id. at *1–3, *8. The trial court denied the motion and also denied the
appellee’s request for attorney’s fees under Section 27.009(b). Id. at *1, *4. The
Marrujo court affirmed the order denying the motion to dismiss but also concluded
16
that the trial court’s denial of the attorney’s fee request was not an abuse of discretion
because the state of the law had been unclear when the appellants filed their TCPA
motion in 2018. Id. at *12. When the appellants filed their motion in that case, the
supreme court had not yet decided Creative Oil & Gas, LLC (delivered December 20,
2019), and the Marrujo court did not issue its en banc decision in Gaskamp until
February 20, 2020. Id. Accordingly, there had been “at least a colorable basis” for the
motion because those dispositive cases had not yet been decided. Id.
If, by the time a TCPA motion is filed, sufficient discovery has been taken and
evidence shown to the trial court to support all of the pleaded causes of action, the
trial court does not abuse its discretion by finding that the motion is frivolous. Lei,
578 S.W.3d at 718. For example, in Lei, by the time that the appellants filed their
TCPA motion, discovery had already been undertaken and the trial court had already
heard evidence—including testimony and forensic evidence—at an injunction hearing
that was sufficient to establish a prima facie case on each of the appellee’s causes of
action. Id. at 717–18.
Here, TAI filed its original petition on August 16, 2019—half a year after this
court issued its opinion in Kawcak on February 21, 2019, and some three months after
the supreme court denied the petition for review on May 10, 2019. See 582 S.W.3d at
566. However, in Kawcak, we did not determine how large a group “crosses the
boundary of common” and held that “the interests of two conspirators who join
17
together to commit a tort do not cross the threshold of common,” id. at 576 (emphasis
added), which is not exactly on point in this breach-of-contract case.
TotalGen filed its motion to dismiss on October 25, 2019. We decided
Garrison on November 14, 2019, see 2019 WL 5996979, at *1, which, under the Texas
Rules of Appellate Procedure, meant the losing party had until December 29, 2019,
assuming no motion for rehearing was filed, to file a petition for review in the
supreme court. See Tex. R. App. P. 53.7(a).
At the December 12, 2019 hearing on TotalGen’s TCPA motion, TAI’s
counsel admitted that “none of the Second Court of Appeals [cases] have dealt with
just a breach[-]of[-]contract issue” but argued that the issue was “relatively decided,”
relying on Garrison, which “was just decided the other day.” And Creative Oil & Gas,
LLC was not decided until December 20, 2019. See 591 S.W.3d at 127. Accordingly,
there was at least a colorable basis for the motion at the time that TotalGen filed it in
October 2019. See Marrujo, 2020 WL 7062318, at *12. And although TAI argues on
appeal that TotalGen knew that TAI had sufficient evidence to build a prima facie
case “well before bringing its motion to dismiss,” that evidence had not been heard by
the trial court prior to the December hearing. Cf. Lei, 578 S.W.3d at 717–18.
Accordingly, we conclude that the trial court abused its discretion by finding that
TotalGen’s motion was frivolous, and we sustain the remainder of TotalGen’s fifth
issue.
18
III. Conclusion
Having concluded that TotalGen did not meet its initial burden to show by a
preponderance of the evidence that TAI’s breach-of-contract claim fell under the
TCPA, we overrule TotalGen’s first and second issues and affirm the portion of the
trial court’s order denying the TCPA motion. But having concluded that the trial
court abused its discretion regarding the award of attorney’s fees to TAI under
Section 27.009(b), we sustain TotalGen’s fifth issue, strike that portion of the order,
and remand the case for further proceedings.
/s/ Bonnie Sudderth
Bonnie Sudderth
Chief Justice
Delivered: January 21, 2021
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