Meta Planning + Design LLC Juan Serna Carlos Fraga Kent Milson Kathryn Parker Jennifer Curtis Ramiro Plata, Jr. v. BGE, Inc. ( 2021 )

Affirmed and Memorandum Opinion filed April 15, 2021
In The
Fourteenth Court of Appeals
NO. 14-19-00253-CV
META PLANNING + DESIGN LLC; JUAN SERNA; CARLOS FRAGA;
KENT MILSON; KATHRYN PARKER; JENNIFER CURTIS; RAMIRO
PLATA, JR., Appellant
V.
BGE, INC., Appellee
On Appeal from the 240th District Court
Fort Bend County, Texas
Trial Court Cause No. 18-DCV-257646
MEMORANDUM OPINION
Appellants Meta Planning + Design, LLC, Juan Serna, Carlos Fraga, Kent
Milson, Kathryn Parker, Jennifer Curtis, and Ramiro Plata, Jr. appeal the trial
court’s denial of their motion to dismiss under the Texas Citizens’ Participation
Act, or “TCPA.” We affirm.
I. FACTUAL AND PROCEDURAL BACKGROUND
Plaintiff-Appellee BGE, Inc. (“BGE”) is an engineering consulting firm
assisting clients with design, planning, and project management services for
residential, commercial, and industrial developments. Defendants-Appellants Juan
Serna, Carlos Fraga, Kent Milson, Kathryn Parker, Jennifer Curtis, and Ramiro
Plata, Jr. were all employees of BGE in its Houston Region Planning Department,
and together made up most of that department.
According to BGE’s petition, Serna, Fraga, Milson, Parker, Curtis, and Plata
(“Former BGE Employees”) began making preparations to compete with BGE by
using and downloading BGE’s proprietary, confidential, and trade secret
information (“BGE Information”) and ultimately left BGE and shared that
information in furtherance of forming their own design planning firm, Defendant-
Appellant Meta Planning + Design LLC (“Meta”).
Upon learning of this scheme, BGE sued Meta and the Former BGE
Employees (collectively, the “Meta Parties”), asserting claims that (a) the Meta
Parties misappropriated trade secrets; (b) the Former BGE Employees breached
their fiduciary duties to BGE (while Meta aided and abetted the same); and (c) the
Meta Parties tortiously interfered with existing and prospective business relations.
BGE also sought and obtained a temporary restraining order to prevent the Meta
Parties’ further use of the BGE Information, and sought a temporary injunction to
prevent the Meta Parties from disclosing BGE Information.
BGE’s pleadings and affidavits set out that (1) the Former BGE Employees
violated provisions of their employment contract which prohibited discussing,
disclosing, or sharing BGE Information, (2) the Former BGE Employees, while
still working at BGE, copied and downloaded allegedly proprietary information
which BGE describes as “client information, project information, planning and
design methods and process developed by BGE [and]. . .plat drawings developed
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by BGE”; (3) the Former BGE Employees created a new competing business
(Meta Planning + Design); (4) the Former BGE Employees used the proprietary
information to target BGE’s existing and prospective clients, and for example used
the plat drawing to compete for bids; and (5) as a result BGE lost out on jobs it
would have otherwise secured.
The Meta Parties moved to dismiss under the TCPA, targeting all of BGE’s
claims and requests for injunctive relief. They argued that BGE’s lawsuit was
based on, related to, or in response to the Meta Parties exercise of their right of free
speech or of their right of association. BGE responded, arguing that its breach of
fiduciary duty claims fell outside the scope of the TCPA, that its trade-secret
misappropriation and tortious interference claims were exempt from the TCPA as
commercial speech pursuant to Section 27.010(b), and that even if its claims were
subject to the TCPA, by virtue allegations pled and affidavits filed, it established a
prima facie case as to all claims. The trial court held a hearing on the motion and
denied the motion without stating its reason. The Meta Parties appealed.
II. ISSUES AND ANALYSIS
On appeal, the Meta Parties complain that the trial court erred in denying
their motion to dismiss because (1) they satisfied their burden to demonstrate that
the TCPA applies to BGE’s claims and request for injunctive relief, (2) BGE failed
to show the commercial speech exemption applies, (3) and BGE did not establish
by “clear and specific evidence a prima facie case for each essential element” of its
claims and request for injunctive relief.
Did the Meta Parties show by a preponderance of the evidence that the claims
in question were based on, related to, or in response to their exercise of the
right of free speech or their exercise of the right of association?
The first step in the TCPA process requires the party filing a motion to
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dismiss to “show[] by a preponderance of the evidence” that the claims in question
are “based on, relate[] to, or are in response to” the party’s exercise of the right of
free speech, the right to petition, or the right of association. Act of May 21, 2011,
82nd Leg., R.S., ch. 341, § 2, 2011 Tex. Gen. Laws 961, 962 (amended 2019)
(current version at Tex. Civ. Prac. & Rem. Code Ann. § 27.005(b) (replacing
“shows by a preponderance of the evidence” with “demonstrates”, and removing
“relates to”)). We review de novo whether the Meta Parties satisfied their burden
to prove that the TCPA applies. Dall. Morning News, Inc. v. Hall, 579 S.W.3d
370, 377 (Tex. 2019).
Legal Standard for Analyzing the Exercise of the Right of Free Speech.
Under the TCPA, a communication made in connection with a matter of public
concern constitutes an exercise of the right of free speech. Tex. Civ. Prac. & Rem.
Code § 27.001(3); Ford v. Bland, No. 14-15-00828-CV, 2016 WL 7323309, at *2
(Tex. App.—Houston [14th Dist.] Dec. 15, 2016, no pet.) (mem. op.). A
“communication” includes “the making or submitting of a statement or document
in any form or medium, including oral, visual, written, audiovisual, or electronic.”
Tex. Civ. Prac. & Rem. Code § 27.001(1). Under the version of the TPCA
applicable to today’s case, a “matter of public concern” is defined to include an
issue related to “health or safety,” “environmental, economic, or community well-
being,” and “a good, product, or a service in the marketplace.” Act of May 21,
2011, 82nd Leg., R.S., ch. 341, § 2, 2011 Tex. Gen. Laws 960, 961 (amended
2019) (current version at Tex. Civ. Prac. & Rem. Code Ann. § 27.001(7)). The
Texas Supreme Court has concluded that the phrase ‘in the marketplace’ requires
that “communication about goods or services must have some relevance to a wider
audience of potential buyers or sellers in the marketplace, as opposed to
communications of relevance only to the parties to a particular transaction.”
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Creative Oil & Gas, LLC v. Lona Hills Ranch, LLC, 591 S.W.3d 127, 134 (Tex.
2019). “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.” Id. at 137.
Legal Standard for Analyzing the Exercise of the Right of Association.
The exercise of the right of association is defined under the TCPA as “a
communication between individuals who join together to collectively express,
promote, pursue, or defend common interests.” 27.001(2). Act of May 21, 2011,
82nd Leg., R.S., ch. 341, § 2, 2011 Tex. Gen. Laws 960, 961 (amended 2019)
(current version at Tex. Civ. Prac. & Rem. Code Ann. § 27.001(2)). Up until
three months ago, the word “common” as it appears in this provision remained
undefined by this court. Republic Tavern & Music Hall, LLC v. Laurenzo's
Midtown Mgmt., LLC, 14-19-00731-CV, 2020 WL 7626253, at *5 (Tex. App.—
Houston [14th Dist.] Dec. 22, 2020, no pet. h.).1 But our court like other courts
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In Gaskamp, a case involving facts the Meta Parties refer to as “identical” to the facts of this
case, the First Court of Appeals discussed right-of-association decisions in cases involving
similar allegations and earmarked our decision in Abatecola, noting that our conclusion that such
claims fell within the scope of the TCPA was reached without an “in-depth” treatment of the
phrase “common interest”. Gaskamp v. WSP USA, Inc., 596 S.W.3d 457, 476 (Tex. App.—
Houston [1st Dist.] 2020, pet. dism'd w.o.m.) (op. on reh'g en banc), citing Abatecola v. 2
Savages Concrete Pumping, LLC, No. 14-17-00678-CV, 2018 WL 3118601 at *7 (Tex. App.—
Houston [14th Dist.] June 26, 2018, pet. denied). As it surveyed other jurisdictions, the First
Court of Appeals embraced the Fort Worth court of appeals’ conclusion that as a threshold
matter for analyzing such cases, the court must first resolve this question: What definition did the
legislature intend to ascribe to the word “common” in the phrase “common interests”? See id. at
473-74, citing Kawcak v. Antero Resources Corporation, 582 S.W.3d 566 (Tex. App.—Fort
Worth 2019, pet. denied). As indicated by the First Court of Appeals, at the time it addressed that
question, we had not. But by the time this court did reach that question (later the same year), we
came to the same answer as our courthouse cotenant: that the “common” interest is one relating
to the public at large. Republic Tavern & Music Hall, LLC, 2020 WL 7626253, at *5. For
reasons explained here and in Republic Tavern & Music Hall, LLC, our analysis of the freedom
of association is now guided as informed by the definition of “common”, whereas prior to this
development it was not. See e.g., Abatecola v. 2 Savages Concrete Pumping, LLC, 2018 WL
3118601 at *7; see also, Reeves v. Harbor America Central, Inc., --- S.W.3d ----, 2020 WL
2026527, (Tex. App.—Houston [14th Dist.] 2020, pet. filed). Despite any inconsistency against
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that have made the deep-dive into the statutory meaning of the word “common”,
have concluded it means “of or relating to a community at large: public.” See id.;
see also TSA-Tex. Surgical Associates, L.L.P. v. Vargas, 14-19-00135-CV, 2021
WL 729862, at *2 (Tex. App.—Houston [14th Dist.] Feb. 25, 2021, no pet.
h.)(citing cases).
Were These Communications Related to a Matter of Public Concern?
The only communications at issue in BGE’s claims against the Meta Parties
are the Former BGE Employees’ acts of downloading trade secrets and proprietary
information while working for BGE, the implicit communications made by the
Former BGE employees in the formation of a competitive business, and
communications made to prospective customers in the form of competitive bids for
design planning services allegedly in violation of obligations imposed by the
Former BGE’s employee’s employment agreements with BGE.
Since the parties filed their briefs, the Texas courts have been prolific in
addressing “matter of public concern” (and various other nooks and crannies of the
pre-2019 amendment TCPA); but two cases are particularly instructive. First, the
Supreme Court’s decision in Creative Oil & Gas, LLC v. Lona Hills Ranch, LLC
significantly limited the scope of what qualifies as “a matter of public concern.”
591 S.W.3d at 137 (“not every communication related somehow to one of the
broad categories set out in section 27.001(7) always regards a matter of public
concern.”). The court considered whether the oil-and-gas-lease lessee’s
counterclaim against a lessor, which were premised on the allegation that the lessor
our prior holdings, the decision to analyze the issue in the same manner as the court we share
jurisdiction is a benefit of uniformity and predictability to the local legal community. See Round
Table Physicians Group, PLLC v. Kilgore, 607 S.W.3d 878 (2020)(Frost, J., concurring and
dissenting).
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“had falsely told third-party purchasers of production from the lease that the lease
was expired and that payments on the purchases should stop,” qualified as “a
matter of public concern.” Id. at 130. Despite these allegations regarding
communications to third party purchasers, the court found the record “devoid of
allegations or evidence that the dispute had any relevance to the broader
marketplace or otherwise could reasonably be characterized as involving public
concerns.” Id. at 136. The court explained such communications, “with a limited
business audience concerning a private contract dispute, do not relate to a matter of
public concern under the TCPA.” Id. at 136. The court further explained that
while “private communications are sometimes covered by the TCPA”, such
particular situations involved “environmental, health, or safety concerns that had
public relevance beyond the pecuniary interests of the private parties involved.”
Id.
The second case, Gaskamp v. WSP USA, Inc. is a case the parties to our case
have appropriately identified as factual similar; it involves similarly situated
parties, claims, and allegations, including allegations by a company against its
former employees that its former employees used the company’s proprietary
information to submit a bids “off the books” to a third party and which the former
employees continued to work on after leaving the company. Relying on Creative
Oil & Gas, our local sister court sitting en banc held in Gaskamp that
communications made by the former employees in soliciting and procuring
business from a third party did not constitute an exercise of the employees’ free-
speech rights because these communications did not have any “relevance to a
public audience of buyers or sellers but instead were limited to ‘the pecuniary
interests of the private parties involved.’” Gaskamp, 596 S.W.3d at 479 (quoting
Creative Oil & Gas, 591 S.W.3d at 136).
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Following Creative Oil and Gaskamp, we conclude that none of the
communications allege by BGE involve issues based on, related to, or in response
to “health or safety,” “environmental, economic, or community well-being.”
Moreover, the Meta Parties failed to show that any of the alleged communications
about design planning services were relevant to a wider audience of potential
buyers or sellers in the marketplace. The communications and conduct at issue are
only relevant to the limited group comprising the Meta Parties, BGE, and the group
of BGE-clients and prospective BGE clients to whom BGE alleged that Meta
Parties had targeted and submitted or planned to submit competing bids. Like the
third-party purchasers in Creative Oil and the bid recipient in Gaskamp, the bid
recipients who double as BGE customers in this case comprise of a limited,
exclusive customer audience; not a broader marketplace. None of the
communications alleged, including these discrete bids which were allegedly aided
by proprietary design standards were relevant to a broader marketplace of potential
buyers or sellers, and such communications, with their limited business audience
concerning a private dispute, do not relate to a matter of public concern under the
TCPA. See Creative Oil & Gas, LLC, 591 S.W.3d at 136; Gaskamp, 596 S.W.3d
at 478-79.
Was This the Exercise of Association for a Common Interest?
The Meta Parties alleged exercise of association did not relate to the
community at large or the general public, but instead relate to an alleged breach of
obligations derived from a private employment relationship between private
parties. See TSA-Tex. Surgical Associates, L.L.P. v. Vargas, 14-19-00135-CV,
2021 WL 729862, at *3 (Tex. App.—Houston [14th Dist.] Feb. 25, 2021, no pet.
h.)(citing cases). Under the court’s newly adopted definition of the word
“common” we agree that the formation of the new business venture is insufficient
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to show a common interest, i.e., it is not related to a community at large.
Gaskamp v. WSP USA, Inc., 596 S.W.3d 457, 476 (Tex. App.—Houston [1st Dist.]
2020, pet. dism'd w.o.m.) (op. on reh'g en banc). Likewise, the conduct and
communications, involved in allegedly misappropriating BGE information and
trade secrets and related torts benefitted only the Former Employees. See id.III. CONCLUSION
Because the Meta Parties failed to show that the actions alleged by BGE are
based on, in response to, or related to appellants' exercise of the right to free speech
or of association, we overrule their complaint to the trial court’s order denying
their motion to dismiss, and accordingly affirm the trial court’s judgment.
/s/ Randy Wilson
Justice
Panel consists of Justices Jewell, Spain, and Wilson.
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