Todd Nobles v. United States Precious Metals, L.L.C and Nathan Camp ( 2020 )

In The
Court of Appeals
Ninth District of Texas at Beaumont
__________________
NO. 09-19-00335-CV
__________________
TODD NOBLES, Appellant
V.
UNITED STATES PRECIOUS METALS, L.L.C. AND NATHAN CAMP,
Appellees
__________________________________________________________________
On Appeal from the 60th District Court
Jefferson County, Texas
Trial Cause No. B-203,885
__________________________________________________________________
MEMORANDUM OPINION
Appellees United States Precious Metals, L.L.C. (USPM) and Nathan Camp
sued Appellant Todd Nobles for breach of contract, business disparagement, and
defamation per se.1 The trial court entered an order denying Nobles’s motion to
1
Appellees also sued for harassment and “potential stalking,” which they later
acknowledged were not recognized causes of action, instead referring to them as
“exemplars.”
1
dismiss under the Texas Citizens Participation Act (TCPA). See generally Tex. Civ.
Prac. & Rem. Code Ann. §§ 27.001–.011. Nobles raises two issues in this
interlocutory appeal: (1) whether Appellees’ claims are based on, related to or in
response to Nobles’s communications made either in connection with a matter of
public concern or with others invoking common interests; and (2) whether
Appellees’ nonsuit and responsive briefing meet their affirmative burden under the
TCPA to establish a prima facie case for every requisite element of their claims by
clear and specific evidence. We hold the TCPA is not applicable to Appellees’
claims and affirm the trial court’s order denying Nobles’s motion to dismiss.
I. Background
The underlying dispute arises out of a buyout agreement between Appellees
and Nobles executed on December 4, 2017.2 This buyout agreement contained a
“mutual non-disparagement” provision. Both Nobles and Camp previously had
ownership interests in USPM and Cross Creek Properties (CCP). Through the
buyout agreement, USPM, CCP, and Camp acquired Nobles’s interests in USPM
and CCP.
2
The parties refer to this document interchangeably as the “buyout
agreement” or the “Verified Settlement and Release Agreement.” For purposes of
clarity, we refer to it as the “buyout agreement” in this opinion.
2
Following the buyout, Nobles remained in touch with various former and
current USPM employees, speaking to them occasionally by telephone or text. Casey
Mozley was one of these employees. Sometimes their discussions concerned sports
and other personal interests, while at other times, the discussions centered around
Camp’s management of the business after Nobles’s departure.
Appellees filed suit against Nobles seeking a temporary restraining order,
temporary injunction, and permanent injunction based on Nobles’s alleged violation
of the anti-disparagement agreement. In their original petition, Appellees alleged
that
Mr. Nobles disparaged Mr. Camp in his conversation with Casey
Mozley on or about March 4, 2019. Mr. Nobles claimed to be acting in
partnership with a disgruntled employee who quit her employment at
USPM, Ms. Christi Armstrong. Mr. Nobles stated that he was going to
“take the company back” from Mr. Camp, and that he was in the process
of documenting a future lawsuit against Camp in order to take over
control of USPM.
Appellees pleaded causes of action for breach of contract, business disparagement,
defamation per se, harassment, and “potentially stalking of Camp by Nobles.”
Appellees sought to recover actual damages, attorneys’ fees and costs, and punitive
damages. In support of their petition, Appellees attached a redacted version of the
signed buyout agreement showing the mutual non-disparagement provision. The
3
trial court granted the temporary restraining order and set the temporary injunction
for oral hearing.
Nobles filed a TCPA motion to dismiss the business disparagement and
defamation per se claims, arguing that the “lawsuit is clearly intended to restrict
Defendant’s exercise of his rights to speak and associate freely.” 3 Nobles further
argued that USPM could not establish by clear and specific evidence a prima facie
case for each essential element of those claims. In Nobles’s TCPA motion to dismiss,
he alleged that since the parties executed the buyout agreement, Appellees had
engaged in conduct that caused him financial harm, and specifically, Camp shifted
tax obligations to Nobles. In his TCPA motion to dismiss, Nobles explained that
[w]hile Defendant is no longer an owner of USPM pursuant to the
Agreement, he has remained in occasional, casual social contact with
some of his former coworkers who remain affected by Plaintiffs’
business practices that necessitated Defendant’s departure from USPM.
Plaintiffs’ conduct has caused Defendant to be concerned for his
financial and legal well-being, as well as that of his former employees
and coworkers, for whom he feels some ethical responsibility.
In his TCPA motion to dismiss, Nobles further contended that Appellees filed
suit against him in “apparent retaliation for questioning Plaintiffs’ tax
3
Nobles did not move to dismiss Appellees’ breach of contract claim in his
TCPA motion. Accordingly, we do not address the breach of contract cause of
action, despite the parties’ extensive briefing on the breach of contract claim. See
Tex. R. App. 33.1
4
activities[.]”Nobles complained that his “occasional personal conversations”
prompted Appellees to file the lawsuit. Ultimately, Nobles argued that the TCPA
applied to bar Appellees’ claims against him for business disparagement and
defamation per se because they “are based on, related to, and are in response to
Defendant’s exercise of his right of free speech.” Nobles argued that the
communications “were made in connection with a matter of public concern,
specifically concerning a good, product or service in the marketplace[.]” He also
contended the TCPA applied because his communications with current and former
USPM employees constituted communications “between individuals who join
together to collectively express, promote, pursue, or defend common interests”
which implicated his right of association. Nobles also sought sanctions and to
recover his attorney fees.
In the trial court, Appellees responded that the TCPA did not apply and that
they were simply attempting to enforce a settlement agreement, specifically the non-
disparagement provision. Appellees non-suited their business disparagement,
defamation per se, harassment and “potential stalking” claims without prejudice the
day of the hearing on the TCPA motion to dismiss leaving only their breach of
contract claim. The trial court denied Nobles’s TCPA motion to dismiss, and this
interlocutory appeal followed. See id. §§ 27.008(b), 51.014(a)(12).
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II. Standard of Review
We review the trial court’s denial of a TCPA motion to dismiss de novo. See
Smith v. Crestview NuV, LLC, 565 S.W.3d 793, 796 (Tex. App.—Fort Worth 2018,
pet. denied) (citations omitted); Walker v. Hartman, 516 S.W.3d 71, 79–80 (Tex.
App.—Beaumont 2017, pet. denied) (citation omitted); see also Adams v. Starside
Custom Builders, LLC, 547 S.W.3d 890, 897 (Tex. 2018) (citations omitted) “In
conducting this review, we consider, in the light most favorable to the non-movant,
the pleadings and any supporting and opposing affidavits stating the facts on which
the claim or defense is based.” Dyer v. Medoc Health Servs., LLC, 573 S.W.3d 418,
424 (Tex. App.—Dallas 2019, pet. denied) (citations omitted); see also Tex. Civ.
Prac. & Rem. Code Ann. § 27.006(a).
Here, Nobles argues that the TCPA applies (1) because his communications
dealt with goods, products or services in the marketplace, and (2) his
communications were also “between and among persons who are collectively
pursuing a matter of common interest[,]” particularly an “evaluation of the efficacy,
lawfulness, and ethics of USPM’s business operations.” We limit our analysis to
those two asserted bases for TCPA applicability. See Forget About it, Inc. v. BioTE
Medical, LLC, 585 S.W.3d 59, 66 (Tex. App.—Dallas 2019, pet. denied); Brugger
v. Swinford, No. 14-16-00069-CV, 2016 WL 4444036, at *2 (Tex. App.—Houston
6
[14th Dist.] Aug. 23, 2016, no pet.) (mem. op.) (confining review on appeal to the
bases for TCPA applicability asserted in the TCPA motion to dismiss); see also Tex.
R. App. P. 33.1.
III. Analysis
A. Effect of Appellees’ Partial Non-suit
A TCPA motion to dismiss survives a nonsuit, because unlike a nonsuit, the
TCPA motion to dismiss permits the movant to obtain a dismissal with prejudice,
attorney’s fees, and sanctions. See Walker, 516 S.W.3d at 80. Nobles’s TCPA
motion to dismiss survived Appellees’ nonsuit of their business disparagement and
defamation per se claims, and we therefore address the merits of the issues on appeal.
See id. at 80.
B. TCPA Generally
The legislature recently amended the TCPA. See Act of May 17, 2019, 86th
Leg., R.S., ch. 378, 2019 Tex. Gen. Laws 684 (current version at Tex. Civ. Prac. &
Rem. Code Ann. §§ 27.001–.011). The prior version of the statute controls cases
filed before September 1, 2019, and therefore, applies to this case. See id. §§ 11–12,
2019 Tex. Gen. Laws at 687.4
4
While we cite to the current version of the statute throughout this opinion,
we provide the session law cites at the outset of our analysis showing the prior
7
The TCPA “protects citizens who petition or speak on matters of public
concern from retaliatory lawsuits that seek to intimidate or silence them.” In re
Lipsky, 460 S.W.3d 579, 584 (Tex. 2015) (orig. proceeding). The TCPA is meant
“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. Courts construe the TCPA liberally to ensure its stated purpose and intent
are fully effectuated. See id. § 27.011; ExxonMobil Pipeline Co. v. Coleman, 512
S.W.3d 895, 898 (Tex. 2017). Under the applicable version of the TCPA, a party
may file a motion to dismiss a “legal action” that is “based on or is in response to a
party’s exercise of the right of free speech . . . or right of association[.]” See Tex.
Civ. Prac. & Rem. Code Ann. § 27.003(a).
A TCPA motion to dismiss involves a multi-step process. See id. § 27.005(b)–
(d); Youngkin v. Hines, 546 S.W.3d 675, 679 (Tex. 2018); Lipsky, 460 S.W.3d at
586–87. First, the defendant-movant bears the initial burden “to show ‘by a
preponderance of the evidence’ that the plaintiff’s claim ‘is based on, relates to, or
version of the statute applicable to this case and the recent amendments applicable
to cases filed after September 21, 2019.
8
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.’” Lipsky, 460 S.W.3d at 586–87 (quoting
Tex. Civ. Prac. & Rem. Code Ann. § 27.005(b)); see also Creative Oil & Gas, LLC
v. Lona Hills Ranch, LLC, 591 S.W.3d 127, 131–32 (Tex. 2019). If the movant
establishes that the plaintiff’s lawsuit implicates one of these rights, the burden shifts
to the plaintiff to “‘establish[ ] by clear and specific evidence a prima facie case for
each essential element of the claim in question.’” Lipsky, 460 S.W.3d at 587 (quoting
Tex. Civ. Prac. & Rem. Code Ann. § 27.005(c)). Finally, if the nonmovant
establishes their prima facie case, the burden shifts back to the movant to establish
each essential element of an affirmative defense by a preponderance of the evidence.
Tex. Civ. Prac. & Rem. Code Ann. § 27.005(d); Youngkin, 546 S.W.3d at 679;
Coleman, 512 S.W.3d at 899.
C. TCPA Applicability
In the present case, Nobles asserts Appellees’ claims are based on, related to,
and are in response to his exercise of his right to free speech and his right of
association. See Tex. Civ. Prac. & Rem. Code Ann. § 27.005(b). To decide whether
a legal action warrants dismissal under the TCPA, we consider the pleadings and
affidavits stating the facts on which liability is based. See id. § 27.006(a).
Determining the legal action’s basis is the first step of the dismissal analysis and
9
requires us to consider the plaintiffs’ petition, which is “the ‘best and all-sufficient
evidence of the nature of the action.’” Hersh v. Tatum, 526 S.W.3d 462, 467 (Tex.
2017) (quoting Stockyards Nat’l Bank v. Maples, 95 S.W.2d 1300, 1302 (Tex.
1936)). A legal action’s basis is determined by the plaintiff’s allegations rather than
the defendant’s admissions or denials. Id. When a plaintiff’s pleadings make clear
that the action is covered by the TCPA, a defendant need not show more. Id.
Although Nobles did not submit any affidavits in support of the motion to dismiss,
we examine the parties’ pleadings and the affidavit of Camp. See Tex. Civ. Prac. &
Rem. Code Ann. § 27.006(a); Dyer, 573 S.W.3d at 424; Walker, 516 S.W.3d at 79
(noting pleadings are considered “as evidence” under the TCPA) (citations omitted).
i. Right to Free Speech
Exercising one’s right of free speech includes any “communication made in
connection with a matter of public concern.” Tex. Civ. Prac. & Rem. Code Ann. §
27.001(3); Adams, 547 S.W.3d at 894. “Matter[s] of public concern” include issues
pertaining to health or safety, environmental, economic, or community well-being,
the government, a public official or public figure, or a good, product or service in
the marketplace. See Adams, 547 S.W.3d at 894; see also Tex. Civ. Prac. & Rem.
Code Ann. § 27.001(7). Nobles argues that the communications at issue concerned
goods, products or services in the marketplace. Accordingly, that is the “matter of
10
public concern” we address. See Tex. R. App. 33.1; Lahijani v. Melifera Partners,
LLC, No. 01-14-01025-CV, 2015 WL 6692197, at *3 (Tex. App.—Houston [1st
Dist.] Nov. 3, 2015, no pet.) (mem. op.) (concluding where TCPA motion to dismiss
argued only that defendant’s statements were related to a “service in the
marketplace,” only that theory was preserved for review). Nobles must establish by
a preponderance of the evidence that his communications were made in connection
with this matter of public concern. See Tex. Civ. Prac. & Rem. Code Ann. §
27.001(3); Adams, 547 S.W.3d at 892.
The parties do not dispute that Nobles communicated with current and former
USPM employees or that those communications formed the basis of the lawsuit.
Specifically, Appellees alleged that Nobles contacted Mozley and Camp. Nobles
characterizes the communications as “occasional personal conversations[.]” The
Texas Supreme Court has previously held “that private communications are
sometimes covered by the TCPA.”5 See Creative Oil & Gas, 591 S.W.3d at 136
(citing Coleman, 512 S.W.3d at 901; Lippincott v. Whisenhunt, 462 S.W.3d 507,
509–10 (Tex. 2015)). The question is whether, as Nobles asserted in his TCPA
5
These prior cases involving private communications dealt with
“environmental, health or safety concerns that had public relevance beyond the
pecuniary interests of the parties involved.” Creative Oil & Gas, LLC v. Lona Hills
Ranch, LLC, 591 S.W.3d 127, 136 (Tex. 2019) (citations omitted).
11
motion to dismiss, those communications concerned a product, good, or service in
the marketplace.
In Creative Oil & Gas, LLC v. Lona Hills Ranch, LLC, the Texas Supreme
Court addressed the meaning of “good, product or service in the marketplace.” 591
S.W.3d at 137. There, the Court determined that the communications at issue were
to “a limited business audience concerning a private contract dispute” and did not
relate to a matter of public concern. See id. at 136. The Court explained that the
record was “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.” See id.
Similarly, the communications at issue here related to Camp’s operation of
USPM following Nobles’s departure and Nobles’s personal tax liabilities following
the buyout. While USPM may offer goods or services in the marketplace, the alleged
communications forming the basis of the lawsuit do not pertain to those goods or
services. Neither the pleadings nor any affidavits establish that Nobles’s
communications went beyond criticizing Camp’s handling of internal USPM
operations, i.e., managing employees, Nobles’s desire to regain control of the
company, or complaining about Nobles’s own tax burden following the buyout. The
complained of communications to current and past employees dealt with private
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company matters and Nobles’s own pecuniary interest rather than USPM’s goods,
products, or services in the marketplace.
Not all communications relating somehow to a broad category set out in
section 27.001(7) always regard a matter of public concern. See id. at 137. “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. The case we find before us boils down to a private dispute over a buyout
agreement and the anti-disparagement provision contained therein, the management
of the company at issue subsequent to that buyout, and a party being dissatisfied with
his tax burden following the sale. Based on the record before us, we conclude that
Nobles failed to meet his burden of establishing by a preponderance of the evidence
that the communications at issue “related to a good, product or service in the
marketplace” constituting “a matter of public concern.”
ii. Right of Association
The applicable version of the TCPA defines the right to associate as “a
communication between individuals who join together to collectively express,
promote, pursue, or defend common interests[.]” Act of May 21, 2011, 82nd Leg.,
R.S., ch. 341 § 2, 2011 Tex. Sess. Law Serv. 960, 960 (amended 2019) (current
version at Tex. Civ. Prac. & Rem. Code Ann. § 27.001(2)) (emphasis added).
13
Appellees’ petition complains of statements Nobles made to Mozley and Camp
which form the basis of this lawsuit.6 Nobles also argues that the communications
were an exercise of his right of association. Specifically, he contends that the
“communications are between and among persons collectively pursuing a matter of
common interest – evaluation of the efficacy, lawfulness, and ethics of USPM’s
business operations.”
The record reveals that Nobles’s communications with Mozley and Camp
consisted of him complaining about his dissatisfaction with the buyout, his tax
burden as a result of the bill, his intention to file a lawsuit to regain control of the
company, and Camp’s treatment of employees. Nothing in the record, either by way
of pleadings or affidavits, establishes that Nobles “join[ed] together to collectively
express, promote, pursue, or defend common interests” with Camp or Mozley. See
id. (emphasis added).
Despite Nobles’s characterization in the TCPA motion to dismiss and on
appeal that the communications were between and among persons “collectively
6
The petition briefly mentions another former employee that Nobles allegedly
worked “in partnership” with; however, the petition does not describe any
communications between Nobles and this other former employee that form the basis
of the lawsuit.
14
pursuing a matter of common interest,” the record does not bear this out. 7 Rather,
the record shows that Nobles was unhappy with the buyout, desired to regain control
of the company, and planned to file a lawsuit; nothing in the record indicates Mozley
joined with Nobles to pursue those as common interests. See id. Likewise, Nobles’s
communications with Camp did not involve the pursuit of a common interest. If
anything, the record reflects that the interests of Nobles and Camp diverged. See
Levatino v. Apple Tree Café Touring, Inc., 486 S.W.3d 724, 728 (Tex. App.—Dallas
2016, pet. denied) (concluding that communications “between adversaries” were
“not between persons acting to promote, pursue, or express their common interest”).
Nobles did not show by a preponderance of the evidence that the communications
were an exercise of his right to associate.
Nobles failed to satisfy his initial burden to show by a preponderance of the
evidence that Appellees’ business disparagement and defamation per se claims were
based on, related to, or in response to his exercise of the right of free speech or the
right of association, and therefore did not trigger the TCPA’s applicability. See
Lipsky, 460 S.W.3d at 586–87 (quoting Tex. Civ. Prac. & Rem. Code Ann. §
7
When reviewing a TCPA motion to dismiss, we consider pleadings in the
light most favorable to the nonmovant and do not “blindly accept attempts by
[appellants] to characterize [appellees’] claims as implicating protected expression.
See Shields v. Shields, No. 05-18-01539-CV, 2019 WL 4071997, at *6 (Tex. App.—
Dallas Aug. 29, 2019, pet. denied) (citations omitted).
15
27.005(b)). Accordingly, the burden never shifted to Appellees to establish a prima
facie case for their claims of business disparagement and defamation per se. See id.
(explaining the burden shifting framework of the TCPA); Tervita, LLC v. Sutterfield,
482 S.W.3d 280, 287 (Tex. App.—Dallas 2015, pet. denied) (reasoning that where
a movant failed to meet its burden of showing the TCPA’s applicability, it need not
address other prongs of TCPA analysis). We overrule both issues.
IV. Conclusion
Having determined that Nobles failed to meet his burden to establish by a
preponderance of the evidence that the TCPA applies, we conclude the trial court
properly denied his TCPA motion to dismiss Appellees’ business disparagement and
defamation per se claims. We affirm the trial court’s order denying Nobles’s TCPA
motion to dismiss.
AFFIRMED.
_________________________
CHARLES KREGER
Justice
Submitted on January 24, 2020
Opinion Delivered March 26, 2020
Before McKeithen, C.J., Kreger and Johnson, JJ.
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