Anubis Pictures, LLC and CMA Films, LLC v. Philco Films Productions, Ltd. ( 2021 )

AFFIRMED and Opinion Filed March 3, 2021
S In The
Court of Appeals
Fifth District of Texas at Dallas
No. 05-19-00817-CV
ANUBIS PICTURES, LLC AND CMA FILMS, LLC, Appellants
V.
LAUREN SELIG, SHAKE & BAKE PRODUCTIONS,
STEPHEN LANNING, AND PHILIP HOBBS, Appellees
On Appeal from the 162nd Judicial District Court
Dallas County, Texas
Trial Court Cause No. DC-17-17579
MEMORANDUM OPINION
Before Justices Pedersen, III, and Reichek1
Opinion by Justice Reichek
Anubis Pictures, LLC and CMA Films, LLC (collectively “Anubis”) appeal
two summary judgments dismissing Anubis’s claims against Lauren Selig and Shake
& Bake Productions (collectively “Selig”). Additionally, Anubis appeals the trial
court’s order granting the special appearances of Stephen Lanning and Philip Hobbs.
In two issues, Anubis generally contends there were fact issues precluding summary
1
The Honorable Bill Whitehill, Justice, participated in the oral argument and submission of this case,
but not the issuance of the opinion, which occurred after the expiration of his term on December 31, 2020.
See TEX. R. APP. P. 41.1(b) (“After argument, if for any reason a member of the panel cannot
participate in deciding a case, the case may be decided by the two remaining justices.”).
judgment in favor of Selig and the trial court had specific jurisdiction over both
Lanning and Hobbs based on their actions as agents for Philco Films, Ltd. (“Philco”),
a company based in London, England. Selig filed a cross-appeal asserting the trial
court erred in denying her motion for sanctions against Anubis and its counsel. For
the reasons that follow, we affirm the trial court’s judgments and orders.
Background
The actions giving rise to this lawsuit involve the financing of a film based on
a screenplay entitled “Downslope” written by the late Stanley Kubrick. In 2009, the
Kubrick estate granted authorization to develop and produce the screenplay to
Philco, Lanning, and Hobbs. Hobbs, who was Kubrick’s son-in-law and a director
of Philco, lives in London. Lanning, who resides in Spain, worked with Hobbs
during the relevant time period.
In October 2013, Philco entered into an agreement with five individuals,
collectively referred to as the SCVTA Group, to secure a portion of the financing for
the production of Downslope. The members of SCTVA agreed to obtain financing
for roughly half the anticipated cost of production in exchange for various finder’s
fees, production credits, and participation points.
Shortly thereafter, SCTVA reached out to Anubis, a Texas-based company,
to see if it wanted to invest in the film stating it would be “a great in-roads project”
for the company to “become players in Hollywood.” Anubis responded with a letter
stating that it would engage in “due diligence and further investigation” with respect
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to arranging financing for Downslope. The letter contemplated that SCTVA would
be the borrower of the funds and a term sheet would be forthcoming. It further stated
that “[t]his letter and the Term Sheet impose no liability or obligation on Anubis in
any way.” The record contains no indication that a loan to SCTVA was ever
pursued.
In November 2013, Jacob Cohen, one of Anubis’s principals, was introduced
to Selig, a partner in Shake & Bake Productions, in connection with a different
project. Following a phone conversation between Cohen and Selig, Cohen sent Selig
an email enclosing a non-disclosure agreement (“NDA”). The email stated that,
once the agreement was executed, Cohen wanted to share a film opportunity with
Selig that included Chris Pine and Anna Kendrick. The recital portion of the NDA
stated,
Anubis is in the business of financing, developing, creating,
distributing, and publishing visual content for television, film, video
games, internet, on-line, mobile, and other forms of distribution.
[Selig] is a potential financial/creative partner and the parties desire to
discuss the potential for Anubis to collaborate with [Selig] in
connection with the aforementioned project(s) (the “Discussions”) and
to provide for the confidentiality of the Discussions and the information
relayed during such Discussions.
The NDA further stated that the parties to the agreement would not use any
confidential information received from the other party “except for the sole purpose
of participating in the Discussions.”
To be covered under the terms of the NDA, confidential information disclosed
in written form was required to be marked confidential on its face. Any oral
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statement intended to be confidential had to be clearly designated as such by the
disclosing party. In addition, confidential information was defined by the NDA to
exclude, among other things, (1) information that had become publicly known
through no wrongful act of the receiving party, (2) information rightfully received
by the receiving party from a third party without restrictions on disclosure and
without breach of the agreement, (3) information approved for release by written
authorization of the disclosing party, and (4) information furnished by the disclosing
party to a third party without a similar restriction on disclosure.
The NDA specifically stated that neither Anubis nor Selig was obligated to
enter into a transactional contract. In a provision entitled “No Obligation to
Complete Transaction,” the parties agreed,
Neither party is bound to proceed with any transaction between the
parties unless and until both parties sign a formal, written agreement
setting forth the terms of such transaction. At any time prior to the
completion of such a formal, written agreement, either party may
terminate the Discussions and refuse to enter into any subsequent
transaction, for any reason or for no reason, without liability for such
termination, even if the other performed work or incurred expenses
related to a potential transaction in anticipation that the parties would
enter into a formal, written agreement regarding such transaction.
In a section entitled “Governing Law,” the NDA provided the agreement would be
governed by the laws of the State of Texas and any action arising out of or relating
to the agreement must be brought in Dallas County. The agreement concluded with
the statement that “[n]o waiver or modification of any of the provisions of this
Agreement shall be valid unless in writing and signed by both parties.”
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After Selig signed the NDA, Cohen emailed her a copy of a script for a film
called “Mantivities” which he stated would star Pine and Kendrick. Cohen asked
Selig to let him know when she had time to discuss financing for the Mantivities
project, but, after some discussion, Selig decided not to participate.
During this time period, Anubis had begun communicating directly with
Philco about the Downslope project. On December 2, Lanning emailed the members
of SCTVA to let them know that Philco had decided all further negotiations would
involve only Philco and Anubis. Lanning emailed Anubis the same day with points
to address in preparation for signing a letter of intent between Anubis and Philco.
Among the points to be addressed in the negotiations was whether Downslope would
be filmed in Texas. Lanning stated Philco needed creative input and “confirmation
by the director that Dallas will work as scripted, scheduled, and budgeted.”
In January 2014, while the letter of intent between Anubis and Philco was
being negotiated, a team from Anubis met with Selig to discuss several potential
projects, including Downslope. On January 10, an Anubis representative, Johnathan
Brownlee, emailed Selig a link to a copy of the Downslope script. Neither the email
nor the script was marked as confidential. Selig responded to Brownlee a few
minutes later asking, “You own it outright?” Brownlee responded, “We have an
executed exclusive to finance for Philco.” Brownlee went on to state that the director
of the film, Jay Russell, had spoken with Joaquin Phoenix and Matt Damon and he
requested that Selig not forward the script. In an email sent a few hours later,
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Brownlee told Selig the budget for the movie was approximately $20 million and,
although it was originally budgeted to be shot in Romania, it was now going to be
shot in Texas. Neither email was marked confidential.
Two and a half weeks later, on the morning of January 27, Brownlee emailed
Selig again, asking if she was interested in discussing the “Kubrick deal.” Over the
next several hours, Selig and Brownlee exchanged emails regarding issues such as
sales estimates and producers. None of the emails was marked as being confidential
or containing confidential information. Selig then asked Brownlee whether Anubis
had shown the Downslope project to anyone else and she stated she had “deep
relationships with Film Nation, Exclusive, and Voltage.” Brownlee responded they
had not yet shown the project to anyone because Anubis wanted to solidify its
financing partners first. Brownlee went on to state, “If you are interested, let us
know. We can put together an LOI subject to budget, sales estimates . . . etc. and
then take it to the market together.”
While Brownlee was in discussions with Selig, Cohen was continuing
negotiations with Philco. Cohen emailed Lanning a letter of intent for Anubis and
Philco “to enter into a more formal Production Financing Agreement.” In the letter,
Anubis stated it was committed to funding up to half of the total budget for the
production of Downslope in exchange for various production credits, approval
rights, and fees. Anubis also specified that Downslope would be shot in Texas and
based in Dallas. The letter concluded, “If the proposed terms are acceptable to you,
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please sign below and we will incorporate these terms into the Agreement in which
both parties shall commence to negotiate and draft in good faith, provided, however,
that until the Agreement is executed, the proposed terms of this letter shall be in full
force and effect.” Later that day, Lanning emailed the members of SCVTA stating
Philco had “agreed and signed our LOI with Anubis. Many thanks for making the
introduction possible.”
Half an hour after Cohen sent Lanning the Philco letter of intent, Brownlee
emailed Selig a substantially similar letter stating, “If this works for you, please
execute and return and we can move forward.” Brownlee testified the letter was
based on discussions with Selig and memorialized the terms to which Selig had
agreed. The terms set out in the Selig letter of intent were largely identical to those
set forth in the Philco letter of intent, but with Selig in the place of Anubis and taking
on the responsibility to fund 50% of the total cost of Downslope. The letter did not,
however, give Selig some portions of the compensation Anubis was to receive from
Philco pursuant to the Philco letter of intent.
The next day, January 28, although Selig had not executed the letter of intent,
Brownlee emailed Selig and told her that she could send the Downslope script to her
industry contacts. Brownlee made no mention of keeping the script confidential.
Brownlee also told Selig he had not yet given any of her information to Philco, but
that Philco was “open to our team financing the entire project” and he would set up
a call with the “whole team” when she was ready. Selig asked if she could contact
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the agent for Joaquin Phoenix, and Brownlee responded that she should “stay away
from agents until we are able to come to an agreement . . . in principle . . . then we
can hit it hard and get the deal packaged!” (Ellipses in original.) Brownlee also sent
Selig a list of twenty well-known actors, including Ryan Gosling, Brad Pitt, Robert
Downey, Jr., and Ryan Reynolds, who he believed might be interested in the project
stating “Confidentially . . . and in no particular order . . . [] I think we can get any
one of these guys based on the script and the Kubrick ‘last script’ buzz.” (Ellipses in
original.) Selig then forwarded the Downslope script to her contacts at Film Nation
and Voltage. The email began with “[s]ending this one to you confidentially” and
went on to say that she and Anubis were “on the hunt for a sales company and to
complete the funding for [the film].”
Later that evening, Brownlee emailed Philco stating Anubis had “a great call
with one of our financial and producing partners regarding ‘Downslope’” and the
partner had “expressed strong interest in financing the entire project.” Brownlee
also stated that Anubis had a “signed NDA with this group.” Although Brownlee
had already told Selig she could speak with her contacts, he requested permission
from Philco to “reach out to some of our strategic distribution and sales partners”
including “Exclusive, Film Nation, and potentially Voltage.” Brownlee went on to
state, “We noticed that we do not have a mutual NDA between our groups and, as a
matter of course, have attached [one] for your execution. We are then happy to share
our partner’s information and set up that call. If you would also not share the project
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with any other potential financing partners until further notice, it would be
appreciated.” The Philco NDA was nearly identical to the one signed by Selig.
On January 30, Selig emailed Brownlee asking if she could contact another
individual with whom she frequently partnered on funding things. Selig stated,
“Also I want to be clear about how this works if I help you get the money or fund it
myself. I don’t want to get into a situation where I pull off a little miracle and get
left in the dust. Has happened before. It’s not fun.”
Shortly thereafter, Cohen sent Selig a copy of Anubis’s letter of intent with
Philco. Selig responded, “This is your letter to them. Did they counter sign? Just
want to make sure you really have this buttoned up and that if I help you raise the
capital on this that I am attached as a producer with fees pari [passu] to you.” 2 Selig
testified that the Philco letter of intent did not indicate to her that Anubis had an
“executed exclusive” with Philco as had been represented, but only a preliminary
arrangement to fund half of the film’s production budget. She also did not view the
letter as an enforceable financing agreement. Selig stated she then sought to make
contact directly with Philco through her industry contacts with the Downslope
director, Jay Russell.
On January 31, Russell introduced Selig to Lanning and Hobbs via email.
Selig told them she was excited about the project and would love to help them get it
2
“Pari passu” is a Latin phrase meaning at the same rate or on equal footing.
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funded. This email was followed by a phone conversation and a request by Selig to
meet with the men when she was in Europe in February.
Selig then emailed Brownlee stating that she had talked with Lanning and
Hobbs and she was “going to get this funded.” Brownlee responded, “Let’s get you
officially attached and then we can set some stakes in the ground and get this done!”
Selig said she could meet with Anubis on February 14 when she returned from
Europe and she wanted to discuss how funding the project would be structured.
Cohen then emailed Lanning asking him to sign the NDA he had sent earlier
and proposed having “an introductory call” with Selig “with the intent that we begin
the drafting of a short form agreement shortly thereafter.” Brownlee also sent an
email to Philco and Selig stating, “We are glad to have our partner, Lauren Selig and
her Shake and Bake productions excited to be a part of this project. Let us all get on
a call on [February 3] and speak and set out some parameters and milestones ahead
of us in order to act as one unified team.”
Before the February 3 conference call, Brownlee emailed Selig’s attorney,
Matthew Hooper, stating Anubis was “happy to include Lauren as an equal partner
in our current overall Anubis deal with Philco. Once we have an executed
agreement, we will go back to Philco and get approvals on requested credits. I
suggest a time/term for Lauren to line up the financing or a clause which states that
the terms of her attachment and remuneration are subject to the performance and
closing of the $21MM in financing for ‘Downslope.’”
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Following the call, Selig emailed Lanning and Hobbs stating she would circle
back with them after talking to Brownlee and asked again if they were available to
meet while she was in Europe. Lanning responded that Hobbs would be in London
when she was there and that he might be able to join them. Lanning further
commented, “Those calls are funny. Until Anubis prove [sic] their half they control
nothing really.” Selig relied, “Yes very funny. They pretend to be something they
are not.”
Later that evening, Selig emailed Lanning and Hobbs asking about proof that
the Downslope script was “authentically Kubrick.” Lanning responded that they had
“a budgeted $2.2 mill fee payable directly to the Kubrick trust guaranteeing its
pedigree. With an accompanying 60 page chain of title.” Lanning followed this
with an email to Brownlee stating, “We will happily provide [chain of title] . . . when
we in turn receive more proof of funds\Financing.” Brownlee forwarded the email
to Selig and told her she could see the chain of title “[w]hen we show [proof of
funds] or commit to the financing. I would suggest that we get our internal deal
signed and then we can make the [chain of title] a request subsequent to executing
the [short form agreement].” When Selig stated that she did not want to proceed
further without seeing a chain of title, Brownlee responded that he understood “if
[she] cannot continue at this point.”
The next morning, after Brownlee learned of Selig’s planned meeting in
London with Philco and others, including Stanley Kubrick’s widow, Christiane
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Kubrick, Brownlee emailed Selig asking “are you okay with [t]he [chain of title] as
you are now set to meet with the Kubrick family[?]” Selig forwarded the email to
Lanning and Hobbs asking how they would like her to handle it. She stated,
[Brownlee] is being rather pushy about my signing a document
with them. I am not going to get into a battle on this and would be
happy to help you fund this and get it cast. If they have an exclusive
with you then my only way to get involved would be to go through
them. If not we need to figure out another way. And I am not interested
in doing a meeting with christian[e] kubrick and anubis at the same time
as I have not signed anything yet.
When Brownlee did not receive a response from Selig about the meeting in
London, he emailed Hooper, telling him, “We have arranged for Lauren to meet with
the Kubrick estate in London . . . Can you give us timing on the Anubis/Selig
document so we can manage expectations on all sides?”
On the morning of February 5, Selig forwarded the Downslope script to
another industry contact along with information about the project obtained from
Russell that was forwarded to her by Lanning. The email stated, “I have the
opportunity to produce with a company called Philco out of the UK that is the family
rights holder. Ccd above. . . . As I mentioned, Glen at Film nation, nick at voltage
and exclusive are the only sales companies that have it so far as they were pre-
approved by philco.” Selig then stated she would be meeting with Christianne
Kubrick in one week and asked for help with casting and funding.
Later that day, Lanning sent an email to Brownlee stating that Philco had other
financiers “willing to go to the next stage with proof of funds via their bankers” and
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asked if Anubis was able to respond accordingly. Lanning further stated that, “So I
am able to deal sensibly with these potential other funders which is dependent on
Anubis creating a new offer for 100% of the finance, I would like you to confirm in
writing that Lauren Selig is signed to partner you in this new arrangement as you
indicated on our recent telephone conversation.” Lanning forwarded the email to
Selig and told her he would send her Anubis’s response. Selig responded that
Brownlee had been trying to call her all morning, but she was “not going to sign his
deal right now. He deserves a finder’s fee, but I don’t want to be tied to him through
this process and I don’t like his way of making up stories. That doesn’t work for
me.” Lanning agreed and noted that Philco would save additional fees if it did not
contract with Anubis directly.
Brownlee responded to Lanning’s email stating, “As I mentioned on the phone
yesterday, we are completing internal documentation between Lauren and Anubis
and we will get written confirmation to you once this is executed. In anticipation of
that, we will be sending an adjusted LOI which allows for Anubis to finance 100%
of “The Downslope” and additional credits to include Lauren and her company.”
Lanning replied that he did not “need another LOI in anticipation of the
Lauren/Anubis Deal. As obviously your deal with her is not finalized yet. More
important to us is the question of you providing proof of funds now to accommodate
other contacts.” Brownlee replied that Anubis’s funding was not contingent upon
Selig’s involvement and they were prepared to speak to Philco’s other potential
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investors once Philco had “signed agreements with them under the same terms as
our executed agreement.”
At the same time, Brownlee emailed Selig asking, “Are you still wanting to
proceed with “The Downslope?” If you could give us an update, it would be
appreciated. If so, we should put Matt [Hooper] in touch with our counsel, Larry
Waks, to complete our agreement.”
Nineteen days later, on February 24, when Philco had not received proof of
funds from Anubis, Lanning sent an email entitled “Termination of Arrangement to
Fund ‘The Downslope.’” In the email Lanning stated,
It is with regret that Philco today is terminating its relationship with
Anubis to part fund “The Downslope.” Your lack of contact has really
unsettled us as well as putting doubt in Philco’s ability to perform with
some of its other potential financial sources. We have been waiting
since February 5th for you to come back to us with some answers or
even to make any contact at all. I personally called on the 6th and 7th
leaving messages on your message service. You also never made any
further contact with our Director who made time to meet up with you
when you were planning your recent LA visit. We will naturally not
discuss with anyone our reasons for ending this arrangement and wish
you great success with all your other projects.
Despite this email, four months later, on June 29, Brownlee emailed Selig
regarding their “mutual project, Downslope” and stated Anubis had become aware
that she was pursuing the opportunity directly with Philco. Brownlee stated he
“found this very disturbing as all parties are aware of our exclusive in this film
project.” Brownlee referenced the non-disclosure agreement Selig signed in
November 2013 and the fact that Anubis had later sent her the Downslope script in
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January 2014. Brownlee then stated that, “As requested, we sent Matthew [Hooper]
our executed agreement with Philco as well as a draft Term Sheet (January 27, 2014)
for your/Shake and Bake’s involvement in our project, “Downslope.’” According
to the email, Anubis made repeated attempts over the following weeks “to get the
Anubis/Shake and Bake Term sheet completed and executed.” Brownlee advised
Selig that “if it is your, or anyone whom you introduced this project too [sic],
intention to proceed at any level with this project, we request that you immediately
comp[l]ete and execute our agreement as originally intended.”
Hooper responded that Anubis had misrepresented its relationship with Selig
to Philco and Anubis’s inability to participate in the project was due to its own
“complacency and poor communication.” The email concluded by demanding that
Anubis cease and desist from stating that “Anubis in any way represents Ms. Selig
in any transaction” or from interfering in Selig’s current or prospective agreements
and business relationships.
Anubis filed this action in December 2017 asserting claims against Selig,
Lanning, and Hobbs for, among other things, breach of the Selig NDA, breaches of
the letters of intent, quantum meruit, promissory estoppel, fraud, and breach of
fiduciary duty. Lanning and Hobbs filed a special appearance contending the trial
court lacked either general or specific jurisdiction over them. Selig filed two
motions for summary judgment.
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Following separate hearings and in separate orders, the trial court granted
summary judgment in favor of Selig, first on Anubis’s contract claims, and later on
its claims for quantum meruit, promissory estoppel, fraud, and breach of fiduciary
duty. On the same day the court granted Selig’s second summary judgment, it signed
an order granting Lanning and Hobbs’s special appearance and dismissed the suit
against them.
Thirty days after Anubis’s claims were dismissed, Selig filed a motion for
sanctions against Anubis and its counsel contending the claims against her were
baseless as shown by Anubis’s own documents and the suit was brought solely for
the purpose of harassment. Anubis responded that Selig failed to identify any proper
basis for an award of sanctions and the motion was “nothing more than an effort to
convert summary judgment practice into a fee-shifting mechanism.” The trial court
denied Selig’s motion and she and Anubis filed these cross-appeals.
Analysis
Summary Judgment
I. Breach of Contract Claims
In its appeal, Anubis first challenges the trial court’s summary judgment
dismissing its claims against Selig for breach of contract. Selig moved for summary
judgment on the contract claims asserting several grounds including that the
evidence conclusively established (1) her nondisclosure agreement with Anubis did
not restrict the information Anubis provided her regarding the Downslope project
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and (2) the unsigned letter of intent was not binding on her. We review an order
granting a motion for summary judgment de novo. Lujan v. Navistar, 555 S.W.3d
79, 84 (Tex. 2018). To be entitled to summary judgment, the movant must show no
genuine issues of material fact exist and they are entitled to judgment as a matter of
law. Id. We first address Anubis claims against Selig based on the non-disclosure
agreement.
A. The Nondisclosure Agreement
Anubis contends the trial court erred in granting summary judgment on its
claims under the NDA because the agreement applied to the Downslope project and
there were fact issues regarding whether Selig misused confidential information
Anubis had given her.3 According to Anubis, the allegedly confidential information
it provided Selig included the Downslope script and information about casting,
budget, sales estimates, and staffing. The NDA between Anubis and Selig required
that, for written material to be considered confidential, it must be marked
confidential on its face. Excluded from the agreement was any information that was
(1) publically known at the time it was disclosed, (2) approved for release by the
disclosing party, or (3) rightfully received from a third party without restriction on
disclosure. Absent a compelling reason, courts must respect and enforce the terms
3
As an alternate ground for summary judgment, Selig asserted that the NDA applied only to the
Mantivities project. For purposes of this opinion, we assume the NDA applied to the Downslope project
as urged by Anubis.
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of the contract the parties have freely and voluntarily made. Bombardier Aerospace
Corp. v. SPEP Aircraft Holdings, LLC, 572 S.W.3d 213, 230 (Tex. 2019).
It is undisputed that the Downslope script was not marked confidential and,
when Brownlee first shared it with Selig, he simply sent her a link to the script
without any indication that it was confidential. In a later email discussing the film’s
director and possible cast members, Brownlee simply stated, “Please do not forward
the script.” This email was followed a short time later by an email in which
Brownlee discussed the film’s budget and the fact that the filming location was being
moved from Romania to Texas. Like the script, these emails were not marked as
confidential and thus would not meet the agreement’s definition of confidential
information. Only one email contained the word “confidentially” and the substance
of that email was not information, but rather speculation by Brownlee about twenty
popular actors he thought might be interested in the Downslope project.
It is also undisputed that the Kubrick estate is the rights holder to both the
Downslope script and the project. Lanning testified Philco became authorized to
represent the Kubrick estate in connection with the Downslope project in 2009 and,
since that time, Philco had shared the script with “many persons and entities . . . who
were interested in developing the script into a movie.” Lanning further testified that,
on behalf of Philco, he “shared with Lauren Selig the script for Downslope and
various other materials relevant to the Downslope project.” Although Anubis argues
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Philco restricted Selig’s ability to disclose the script, thereby making it confidential
under the terms of the NDA, Anubis cites no evidence to support this assertion.4
Anubis contends that, even if the materials it disclosed to Selig were not
initially covered by the agreement, there is a fact issue regarding whether the parties
considered the information confidential because Selig treated it as such when she
asked for Anubis’s permission to send the Downslope script and information about
the project to some of her contacts. This argument begs the question of how Selig
could have breached the NDA if she treated the information given to her as
confidential in the manner prescribed by the agreement.
The summary judgment evidence contains three disclosures by Selig of
information about the Downslope project. The first two disclosures occurred on
January 28, 2014, and were authorized by Anubis in writing, thus removing the
information from the definition of confidential information under the terms of the
agreement. The third disclosure occurred on February 5 and was specifically
4
Although Anubis provides a record citation to support this argument, the page Anubis cites is a court
reporter’s certification. Immediately preceding this page is deposition testimony by Selig in which she
stated that it would be her “preference that the Downslope script isn’t shared to the greater public.” Anubis
does not explain how this statement can be read to suggest that Philco restricted Selig’s use of the script.
Alternatively, on the pages following the court reporter’s certification are emails between Selig and
Lanning. In these emails Selig requested Philco’s permission to reach out to other contacts to “package”
with her on the project. The emails do not contain any reference to restrictions on Selig’s use or disclosure
of information, nor can any such restriction be inferred. Lanning’s response to Selig’s request was simply
“Yes,” with no mention of any restrictions on the information Selig could provide her contacts. The email
Selig then sent to one of her contacts, and on which both Lanning and Hobbs were copied, included the
Downslope script and information about the budget, production, and casting with no mention of
confidentiality.
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authorized by Philco. This disclosure included the script, to which Philco had the
exclusive rights from the Kubrick estate, and information from the film’s producer
given to Selig by Lanning, not Anubis.5
Anubis contends that, under the terms of the NDA, Selig was permitted to use
the information it gave her about Downslope only for the purpose of participating in
discussions with Anubis. Accordingly, it argues that her working directly with
Philco constituted a violation of the agreement and any information she received
from Philco was not “rightfully received.” In making this argument, Anubis
attempts to bootstrap its claim that Selig violated the NDA to its claim that she
breached the unsigned letter of intent. The NDA states that neither party is obligated
to proceed with any transaction until both parties sign a formal, written agreement
setting forth the terms of the transaction. The NDA further states that, at any time
prior to the completion of such a formal, written agreement, Selig was free to
terminate her discussions with Anubis. Nothing in the NDA prevented Selig from
choosing not to proceed with Anubis and to work with directly with Philco.
5
Lanning testified he gave Selig a copy of the script in February 2014. Anubis argues the evidence
suggests this did not occur until after Selig sent the script to her contact on February 5. Because of this,
Anubis contends Selig must have sent the copy it received from Anubis which was covered by the
agreement and required Anubis’s authorization. Even assuming the script could be considered confidential
information, it is undisputed that Anubis received its copy of the script from Philco and that Philco
authorized Selig to disclose the script to her contact on February 5. Brownlee in fact testified that he
requested Philco’s permission to share the script when he authorized Selig to make the January 28
disclosures. Whether the copy of the script Selig sent her contact on February 5 was given to her by Anubis
or Philco is a distinction that makes no difference.
–20–
Nor does the NDA prevent Selig from using information she obtained from
Anubis once she obtained the same information from Philco. In fact, the agreement
excludes such information from coverage. While Selig may not have been aware of
the opportunity to work with Philco prior to Anubis discussing the project with her,
the opportunity itself was not confidential information and Anubis makes no
argument to show that it was.6 Although the agreement prevents Selig from
disclosing to Philco any confidential information she obtained from Anubis of which
Philco was unaware, there is no evidence in the record that this occurred. The
evidence shows instead that Selig’s discussions with Philco involved information
provided by, and originating from, sources unrelated to Anubis and given to Selig
by Philco. Accordingly, we conclude the trial court properly granted summary
judgment on Anubis’s claim for breach of the NDA.
B. The Letter of Intent
Selig moved for summary judgment on Anubis’s claim for breach of the letter
of intent contending the evidence conclusively showed no enforceable transactional
contract was ever formed. Anubis concedes that Selig never signed the letter of
intent, but argues there is a fact issue regarding whether an enforceable oral
6
Selig provided summary judgment evidence showing that the production of the Downslope script and
Philco’s involvement with the project was publically known for years before Anubis became involved.
Although Anubis objected to this evidence, the trial court overruled these objections and, other than noting
the objection, Anubis presents no argument or authority on appeal challenging the trial court’s ruling.
–21–
agreement was created. We conclude the summary judgment evidence shows no
enforceable contract was formed as a matter of law.
To prove the formation of a valid and enforceable contract, Anubis is required
to establish that (1) an offer was made; (2) the other party accepted in strict
compliance with the terms of the offer; (3) the parties had a meeting of the minds on
the essential terms of the contract; (4) each party consented to those terms; and (5)
the parties executed and delivered the contract with the intent that it be mutual and
binding. USAA Texas Lloyds Co. v. Menchaca, 545 S.W.3d 479, 502 n.21 (Tex.
2018). In addition, a party seeking to recover under a contract bears the burden of
proving that all conditions precedent have been satisfied. Chalker Energy Partners
III, LLC v. Le Norman Operating LLC, 595 S.W.3d 668, 673 (Tex. 2020). Parties
may agree that a formal, written agreement signed by the parties is a condition
precedent to contract formation. Id.The elements of oral contracts are the same as for written contracts and must
be present for a contract to be binding. Thornton v. Dobbs, 355 S.W.3d 312, 316
(Tex. App.—Dallas 2011, no pet.). In determining whether an oral contract exists,
we examine the communications between the parties and the circumstances
surrounding those communications. Id. Although whether parties have formed a
contract to which they intend to be bound is often a question of fact, it may be
resolved by the court as a matter of law. See Chalker, 595 S.W.3d at 673.
–22–
In this case, the only contract signed by both parties was the NDA. In that
contract, Anubis and Selig agreed that neither party was “bound to proceed with any
transaction between them unless and until both parties signed a formal, written
agreement setting forth the terms of such transaction.” The Texas Supreme Court
recently addressed the effect of a substantially similar “no obligation” provision in
Chalker Energy Partners III, LLC v. Le Norman Operating LLC. Id.
In Chalker, the parties signed a “Confidentiality Agreement” that included a
“no obligation” provision stating “unless and until a definitive agreement has been
executed and delivered, no contract or agreement providing for a transaction
between the Parties shall be deemed to exist.” Id. The supreme court began its
analysis of the effect of this provision by stressing that “Texas’s strong public policy
favoring freedom of contract is firmly embedded in our jurisprudence.” Id. The
court went on to conclude that language such as that found in the “no obligation”
clause “makes clear the parties’ intent that the contemplated formal document is a
condition precedent to contract formation.” Id at 674. Because no contract was
“executed and delivered” by the parties as required by the confidentiality agreement,
the court concluded no binding transactional contract was created as a matter of law.
Id.
The language in the NDA before us is substantively identical to the language
presented in Chalker. The “No Obligation to Complete Transaction” provision of
the NDA drafted by Anubis required the parties to sign a formal, written agreement
–23–
setting out the terms of the transaction before the parties became contractually
bound. Because Selig never signed a written agreement with Anubis, the agreed
upon condition precedent to the formation of a transactional contract was never
fulfilled and no binding contract was created. Id.
Like the plaintiff in Chalker, Anubis argues Selig waived the requirement of
an executed written contract by her conduct. Waiver is an intentional relinquishment
of a known right or intentional conduct inconsistent with claiming that right. Id. at
676. Although waiver is ordinarily a fact question, when the surrounding facts and
circumstances are undisputed, waiver may be decided as a matter of law. Id. at 676–
77. To establish waiver by conduct, Anubis was required to show that Selig acted
in a manner that was “unequivocally inconsistent” with relying on her right to not
be bound until she signed a formal, written agreement. See id. at 677.
The evidence Anubis relies upon to show waiver is largely affidavit testimony
by Brownlee. In his affidavit, Brownlee stated that, on January 27, 2014, he spoke
with Selig on the phone and “Anubis understood that agreement had been reached.”
Brownlee further testified that “Selig requested that the terms be memorialized in
writing” and “at Ms. Selig’s direction, Anubis sent Ms. Selig a letter of intent . . .
memorializing those terms and requested her signature so that ‘we can move
forward.’”
Rather than demonstrating waiver, this testimony confirms that Selig was
relying on the need for a signed, written agreement before she would be contractually
–24–
bound to proceed with any transaction with Anubis. Brownlee’s testimony
concerning his understanding of the conversation with Selig is insufficient on its
own to create a fact issue. An interested witnesses’ affidavit testimony reciting that
he believes certain facts to be true is not readily controvertible and has no probative
value. Doe I v. Ripley Entm’t, Inc., No. 05-18-00470-CV, 2020 WL 57339, at *3
(Tex. App.—Dallas Jan. 6, 2020, no pet.) (mem. op.). Brownlee’s self-serving
statement that he believed an oral agreement had been reached, without any
underlying factual support, will not raise a fact issue to defeat summary judgment.
Id.The absence of underlying facts to support Brownlee’s testimony is made
apparent by the abundant evidence showing that neither Selig nor Anubis conducted
themselves in a manner suggesting an enforceable transactional agreement between
them had been reached. Anubis points to the emails Selig sent to her industry
contacts stating that she and Anubis were “on the hunt” for funding for the
Downslope project as evidence that Selig believed the parties had finalized an
agreement to work together. But the NDA drafted by Anubis contemplated the
parties would “perform[] work or incur[] expenses related to a potential transaction
in anticipation that the parties would enter into a formal, written agreement regarding
such transaction.” It was agreed that such work would be performed without either
party being liable to the other if they chose not to go forward with the transaction
before a formal agreement was signed. Performing work related to the potential
–25–
transaction does not, therefore, demonstrate Selig believed a binding transactional
agreement between the parties existed or that she intended to waive the requirement
of a formal, written contract signed by both parties. All other communications
between Selig and Anubis are consistent with Selig’s assertion that no enforceable
agreement had been created.
Immediately before Selig sent the emails to her contacts stating that she and
Anubis were “on the hunt” for funding, Brownlee told her that she could not contact
the agent for one of the proposed actors because they had not yet “come to an
agreement [] in principle.” Later that same day, Brownlee told Philco that Anubis
had a signed NDA with Selig, but made no mention of any transactional agreement.
Two days later, after Selig received a copy of the letter of intent between
Philco and Anubis, Selig expressed concern to Brownlee that “if” she helped Anubis
raise capital for Downslope, she wanted to make sure she was “attached as a
producer with fees pari [passu]to [Anubis].” Contrary to Selig’s stated requirement,
the letter of intent drafted by Anubis did not grant her the same compensation that
Anubis was to receive. Accordingly, the letter of intent upon which Anubis relies
did not reflect the deal Selig stated she wanted.
Over the next several days, Anubis repeatedly requested that Selig sign the
letter of intent so that she would be “officially attached.” Brownlee stated Anubis
could not get approvals on producer credits for Selig until she and Anubis had “an
executed agreement.” Additionally, Brownlee sent an email to Selig’s attorney
–26–
suggesting that a clause be added to the agreement stating the terms of her
attachment and remuneration would be subject to her performance in obtaining
financing. It is clear from this, that the terms of a transactional agreement between
Anubis and Selig were still being negotiated.
Finally, on two different occasions, Brownlee indicated Selig was free to
discontinue her involvement with Downslope. When Selig told Brownlee she did
not want to continue exploring funding without a chain of title guaranteeing
authenticity of the script, Brownlee responded that he understood if she chose not to
continue with the project at that point. Brownlee later asked Selig if she was “still
wanting to proceed with ‘The Downslope?’” All communications between Selig
and Anubis clearly demonstrate Selig did nothing unequivocally inconsistent with
her right to insist upon a formal, written agreement signed by both parties. We
conclude the trial court properly granted summary judgment on Anubis’s claim for
breach of the letter of intent. See Chalker, 595 S.W.3d at 677.
II. Quantum Meruit
As an alternative to its contract claims, Anubis additionally sought to recover
from Selig under a quantum meruit theory. Anubis asserts that Selig’s email to
Lanning in which she suggested Anubis was entitled to a “finder’s fee” for bringing
the parties together was “legally sufficient evidence that Anubis provided her with
valuable services or materials.” We disagree.
–27–
Quantum meruit is an equitable remedy based upon the promise implied by
law to pay for beneficial services rendered and knowingly accepted. Hill v. Shamoun
& Norman, LLP, 544 S.W.3d 724, 732 (Tex. 2018). To recover under quantum-
meruit, the claimant must prove that: (1) valuable services were rendered or
materials furnished; (2) to the person sought to be charged; (3) those services and
materials were accepted by the person sought to be charged, and were used and
enjoyed by her; and (4) the person sought to be charged was reasonably notified that
the claimant performing such services or furnishing such materials was expecting to
be paid by the person sought to be charged. Id. at 732–33. A party generally cannot
recover under a quantum meruit claim when there is a valid contract covering the
services or materials furnished. Id. at 733.7
Anubis contends that it expected compensation for introducing Selig to
Philco. To succeed on its claim, however, Anubis was required to show that it
7
In her first motion for summary judgment, Selig contended that any services or materials furnished
to her by Anubis were covered by the NDA, which specifically prohibited recovery for work performed or
expenses incurred related to a potential transaction if the parties did not enter into a formal, written
transactional agreement. After a hearing on Selig’s motion, the trial court granted summary judgment
against Anubis on its contract claims, but reserved judgment on the remaining claims, including the
quantum meruit claim, until after further discovery was conducted. Sometime later, Selig filed a second
motion for summary judgment on Anubis’s remaining claims. In this motion, Selig did not reassert her
argument that the NDA contractually barred Anubis’s claim for quantum meruit. Nor did she incorporate
her prior motion for summary judgment by reference. In its order granting summary judgment in favor of
Selig on Anubis’s claims for quantum meruit, breach of fiduciary duty, fraud, and promissory estoppel, the
trial court stated it considered only Selig’s second motion for summary judgment. Accordingly, our review
is limited to the grounds presented in that motion.
–28–
expected compensation from Selig for introducing her to Philco. Id.8 The evidence
presented by Anubis showed that it cultivated a relationship with Selig in the hope
that she would agree to provide financing to Philco. If the deal was consummated,
both Anubis and Selig would receive compensation from Philco. Anubis presented
no evidence that there was ever any contemplation that Selig would compensate
Anubis for anything. See Peko Oil USA v. Evans, 800 S.W.2d 572, 576 (Tex. App.—
Dallas 1990, writ denied) (quantum meruit claim fails absent evidence of expectation
of payment from defendant).
Even the gratuitous “finder’s fee” statement made by Selig, and relied upon
by Anubis, cannot support Anubis’s claim. First, Selig was brought in by Anubis
for the benefit of itself and Philco. As the “found” party, Selig would not be the one
obligated to pay the fee. More importantly, Anubis’s alleged contract with Philco
stated that Anubis was to provide funding for the Downslope project, not find other
parties who would provide funding.9 Anubis provided no evidence that either Selig
or Philco expected or agreed at the time the introduction was made that Anubis
would be paid a finder’s fee for its introduction of Selig to Philco. See id. (court will
8
Anubis contends that Selig’s second motion for summary judgment challenged only the first two
elements of its quantum meruit claim. We do not read Selig’s motion so narrowly. In her motion, Selig
clearly argued that Anubis could not show it expected payment from her for any services it rendered.
9
Anubis contends that its due-diligence letter with SCTVA contemplated Anubis could arrange
financing for Downslope with “one or more lenders.” This letter, by its terms, (1) was between only Anubis
and SCTVA, (2) specified SCTVA as the recipient of funds raised by Anubis, and (3) “imposed no liability
or obligation on Anubis in any way.” Selig was not a recipient of this letter and there is no evidence she
was ever aware of it. Anubis does not explain how this letter concerning a potential loan that never occurred
between two unrelated entities could create an implied obligation owed by Selig.
–29–
not fabricate promise implied by law for cash payment parties neither expected nor
agreed upon).
Finally, it is elementary in the law governing quantum meruit that no recovery
can be had for preliminary services that are performed with a view to obtaining
business through a hoped-for contract. Id. at 577. “Where preliminary services are
conferred for business reasons, without the anticipation that reimbursement
will directly result, but rather, with the expectation of obtaining a hoped-for contract
and incidental to continuing negotiations relating thereto, quasi-contractual relief is
unwarranted.” Id. Quantum meruit relief may not be obtained where the claimant
did not contemplate compensation at the time the services were rendered or the
defendant could not have reasonably believed the plaintiff expected compensation.
Id. at 577–78.
Anubis relies on the Texas Supreme Court’s opinion in Vortt Exploration Co.
v. Chevron U.S.A., Inc., 787 S.W.2d 942 (Tex. 1990), to argue that quantum meruit
relief can be based on the expectation of a future contract. In that case, the supreme
court concluded that Chevron had sufficient notice that Vortt expected to be
compensated for confidential information it provided Chevron when both parties
understood the information was being disclosed based on the expectation of it being
used as part of a joint operating agreement. Id. at 945. Anubis contends it is
similarly entitled to quantum meruit relief because it furnished confidential
information to Selig with the expectation that she and Anubis would enter into a
–30–
transactional agreement. As this Court has stated, however, Vortt was decided on
the narrow issue of sufficient notice only. Peko, 800 S.W.2d at 579. Vortt does not
alter longstanding law that no quantum meruit recovery may be obtained based on
services performed with a view toward obtaining a hoped-for contract.
Unlike the facts presented in Vortt, Anubis has presented no evidence that
Selig was reasonably notified that Anubis expected her to compensate it for the
information it provided or that the information was disclosed to her based on the
understanding that an agreement between them was certain to occur. Most of the
alleged confidential information was disclosed to Selig on January 10, well before
any discussions about working together on the Downslope project began. It was not
until more than two weeks later that Anubis reached out to Selig to ask if she was
interested in discussing the possibility of working with Anubis on Downslope. It
was at this point that Anubis disclosed the remaining information and stated “If you
are interested, let us know.” At the time the information was disclosed, therefore,
there was clearly no understanding between the parties that an agreement to work
together was expected. Indeed, the NDA drafted by Anubis notified Selig of the
opposite – that neither party should expect a transactional agreement to necessarily
occur based on the parties’ discussions. We conclude the trial court properly granted
summary judgment on Anubis’s claim for quantum meruit.
–31–
III. Breach of Fiduciary Duty
In contending the trial court erred in granting summary judgment on its claim
for breach of fiduciary duty, Anubis first argues that Selig failed to move for
summary judgment on its claim that Selig owed it a fiduciary duty based on the
parties having formed a partnership. The trial court’s order granting summary
judgment on Anubis’s claim for breach of fiduciary duty was based on Selig’s
second motion for summary judgment. In that motion, Selig stressed that, even
though Anubis referred to her as a partner, “she never agreed to be anyone’s partner”
and “[s]he never partnered with Anubis.” She further stated that the letter of intent
drafted by Anubis “was not even close to being a partnership agreement” and, even
if it was, the agreement was never executed. In the portion of the motion specifically
addressing Anubis’s fiduciary duty claims, Selig summarized the history of the
parties’ business dealings, including the fact that she never executed the letter of
intent, and argued “there is no foundation from which the court could recognize a
fiduciary duty on these facts.” We conclude Selig’s motion sufficiently challenged
Anubis’s assertion that Selig had formed a partnership with Anubis giving rise to a
fiduciary duty.
Anubis next argues it presented sufficient evidence to create a fact issue as to
whether the parties created a partnership. Specifically, Anubis contends it presented
evidence of the factors indicating the creation of a partnership under section
152.052(a) of the Texas Business Organizations Code. See TEX. BUS. ORGS. CODE
–32–
ANN. § 152.052(a). These factors are irrelevant, however, where the parties have
agreed that no binding or enforceable obligations will be created unless certain
conditions are met. See Energy Transfer Partners, L.P. v. Enter. Prods. Partners,
L.P., 593 S.W.3d 732, 741 (Tex. 2020). Such an agreement to not be bound absent
the specified conditions is ordinarily conclusive on the issue of partnership
formation. Id.In this case, Selig and Anubis agreed they were not obligated to work together
on any transaction unless both parties signed a formal, written transactional contract.
It is undisputed that this did not occur. Although performance of a condition
precedent to forming a partnership can be waived, in determining whether such
waiver has occurred, we consider only evidence directly tied to the condition
precedent, and not the factors relevant to partnership creation set out in section
152.052(a). Id. As discussed above, the evidence conclusively shows Selig did not
waive her right to require a signed contract before being obligated to work with
Anubis. Accordingly, Selig negated the creation of a partnership as a matter of law.
See id. Anubis asserts no other basis upon which Selig would owe a fiduciary duty
to Anubis. Accordingly, we conclude the trial court properly granted summary
judgment in favor of Selig on this claim.
IV. Fraud and Promissory Estoppel
In its final challenge to the summary judgment, Anubis argues the trial court
erred in dismissing its claims for fraud and promissory estoppel because it presented
–33–
evidence that Anubis forewent searching for other potential funding partners based
on alleged misrepresentations made by Selig. The statements Anubis contends it
relied upon were: (1) Selig’s request for permission to send the Downslope script to
her industry contacts; (2) Selig’s emails to her contacts stating that she and Anubis
were “on the hunt” for funding; (3) Selig’s email expressing concern that she not
“get left in the dust” if she helped Anubis find funding or funded the movie herself;
(4) Selig’s email stating that, if she helped Anubis raise capital, she expected
compensation equal to that being received by Anubis; and (5) Selig’s emails stating
that, after meeting independently with Russell, Lanning, and Hobbs, she was going
to “get this funded” and she was willing to meet with Anubis to “talk about how this
gets structured.” Anubis argues that Selig’s “expressed enthusiasm for partnering
on the project” induced it to “not solicit other funding sources to which it had
access.”
A central element to both fraud and promissory estoppel is detrimental
reliance. Gilmartin v. KVTV-Channel 13, 985 S.W.2d 553, 558 (Tex. App.—San
Antonio 1998, no pet.). To support recovery, such reliance must be both reasonable
and justified. Id. Reliance is justified only when a promise is sufficiently specific
and definite that it is reasonable to rely on it as a commitment to future action. Davis
v. Tx. Farm Bureau Ins., 470 S.W.3d 97, 108 (Tex. App.—Houston [1st Dist.] 2015,
no pet.). Neither statements of hope nor expressions of expectations can support
reasonable reliance. Esty v. Beal Bank, S.S.B., 298 S.W.3d 280, 305 (Tex. App.—
–34–
Dallas 2009, no pet.). We will not create a contract based on estoppel where none
existed before. Gillum v. Republic Health Corp., 778 S.W.2d 558, 570 (Tex. App.—
Dallas 1989, no pet.).
None of the statements Anubis points to constitutes a specific and definite
promise by Selig to partner with Anubis. Even taken together, they demonstrate
nothing more than engagement in the discussions referred to in the NDA that could
potentially lead to a signed transactional contract. “Expressed enthusiasm” cannot
take the place of a specific and definite promise upon which Anubis could have
justifiably relied. See Montgomery Cty. Hosp. Dist. v. Brown, 965 S.W.2d 501, 503
(Tex. 1998) (only definite promises, not vague assurances, can support justifiable
reliance); see also Hui Ye v. Xiang Zhang, No. 4:18-cv-4729, 2020 WL 2521292, at
*6–7 (S.D. Tex. May 15, 2020). This is particularly true given the NDA’s provision
that either party could opt out of going forward with the transaction at any point prior
to signing a transactional agreement even if the other party took actions in
anticipation that a written transactional agreement would occur. Cf. Davis, 470
S.W.3d at 109 (plaintiff could not justifiably rely on unaccepted settlement offer that
could be withdrawn at any time as basis for not filing action before limitations period
expired). Anubis’s choice to not solicit other funding partners was made at its own
peril. Id.
In addition, it must be noted that Anubis was brought in as an investor in the
Downslope project in October 2013, but did not begin talking to Selig until January
–35–
2014. It was not until January 27 that Brownlee began actual discussions with Selig
about Downslope and suggested that the parties enter into a transactional contract.
On February 3, Brownlee stated that he understood if Selig did not want to continue
with the project and, on February 5, Brownlee asked Selig if she was still interested
in working with them. After sending that inquiry, Brownlee informed Philco that
Anubis’s agreement to fund Downslope was “not contingent on [Selig’s]
involvement.” The record contains no communications between Anubis and Selig
after February 5. Three weeks later, Philco terminated its relationship with Anubis
for failure to provide proof that it could supply the promised funds. Therefore, of
the almost five months Anubis was involved in the Downslope project, it was in
discussions with Selig for only slightly more than one week. The content of those
discussions clearly presumes that Selig might not go forward with the project. We
conclude Selig established there was no reasonable or justifiable reliance by Anubis
as a matter of law and the trial court properly granted summary judgment on
Anubis’s claims for fraud and promissory estoppel.
Special Appearance
In its second issue, Anubis contends the trial court erred in granting the special
appearance filed by Lanning and Hobbs and dismissing its claims against them for
lack of jurisdiction. Anubis’s first amended petition alleged the trial court had
personal jurisdiction over Lanning and Hobbs because they (1) made
misrepresentations regarding Philco’s rights and interests in Downslope, (2) worked
–36–
with Anubis in connection with the Downslope project, in part, because of Anubis’s
presence in Texas, (3) agreed to shoot the film at a Texas location through a Texas-
based studio in Dallas County and prepared budgets detailing a Texas-focused
production, and (4) made intentional misrepresentations to Anubis in Texas with the
intent that Anubis rely on them. Anubis further alleged that, even if the actions at
issue were conducted by Lanning and Hobbs as agents for Philco, all of Philco’s
contacts could be attributed to Lanning and Hobbs because Philco was their alter ego
and the men used Philco to perpetrate a fraud in Texas. Anubis sought a declaratory
judgment on its alter ego allegation and asserted claims against Lanning and Hobbs
for unjust enrichment, breach of the letter of intent, fraud, and fraudulent transfer.
Lanning and Hobbs filed a special appearance, supported by affidavits,
contending they had insufficient contacts with Texas to support either general or
specific jurisdiction of the trial court over them and Anubis had no evidence to
support its jurisdictional allegations. On appeal, Anubis does not contend the trial
court had general jurisdiction over Lanning or Hobbs. It contends only that the trial
court had specific jurisdiction based on Philco’s business dealings with Anubis,
including the NDA and letter of intent, which were attributable to Lanning and
Hobbs based on an alter ego theory of liability. Anubis further asserts Lanning and
Hobbs are independently liable for their own fraudulent and tortious acts.
Whether a trial court has personal jurisdiction over a nonresident defendant is
a question of law we review de novo. Old Republic Nat’l Title Ins. Co. v. Bell, 549
–37–
S.W.3d 550, 558 (Tex. 2018). To resolve this question, however, the trial court
frequently must resolve preliminary questions of fact. BMC Software Belgium, N.V.
v. Marchand, 83 S.W.3d 789, 794 (Tex. 2002). If, as here, the trial court does not
issue findings of fact and conclusions of law with its special appearance ruling, all
findings of fact necessary to support the ruling that are supported by the evidence
are implied. Id. at 795. When the appellate record includes the reporter’s and clerk’s
records, these implied findings are not conclusive and may be challenged for legal
and factual sufficiency on appeal. Id. Where jurisdictional facts are undisputed, we
need not consider any implied findings of fact and consider only the legal question
whether the undisputed facts establish jurisdiction. Old Republic, 549 S.W.3d at
558.
Anubis does not dispute that the alleged agreements and business dealings
made the basis of its claims against Lanning and Hobbs were between Anubis and
Philco. Anubis asserts that Philco’s contacts with Texas were sufficient to give rise
to specific jurisdiction and are attributable to Lanning and Hobbs on an alter ego
theory of liability. Even assuming Philco’s contacts were sufficient to subject it to
jurisdiction in this state, we conclude Anubis failed to meet its burden to show an
alter ego relationship.
“Jurisdiction over an individual cannot, as a general rule, be based upon
jurisdiction over a corporation.” Wilmington Trust, Nat’l Ass’n v. Hsin-Chi-Su, 573
S.W.3d 845, 855 (Tex. App.—Houston [14th Dist.] 2018, no pet.). The party
–38–
seeking to pierce the corporate veil for jurisdictional purposes has the burden to
present evidence demonstrating the alter ego relationship. BMC Software 83 S.W.3d
at 798. An individual’s status as an officer, director, or shareholder of an entity,
standing alone, is not enough to support an alter ego finding. Wilmington Trust, 573
S.W.3d at 855. The plaintiff must prove the individual exercises atypical control
over the internal business operations and affairs of the corporation that is
inconsistent with his role as owner, director, or shareholder. Id. Factors relevant to
the determination of an alter ego relationship for jurisdictional purposes include the
degree to which corporate and individual property have been kept separate, the
amount of financial interest, ownership, and control the individual maintains over
the corporation, and whether the corporation has been used for personal purposes.
Id. Ultimately, for a court to find personal jurisdiction under an alter ego theory, the
evidence in the record must show that the individual and the entity cease to be
separate so that the corporate fiction should be disregarded to prevent fraud or
injustice. BMC Software, 83 S.W.3d at 799. A conclusory allegation that a
nonresident defendant used a corporation “as a sham to perpetrate fraud” is
insufficient to pierce the veil for jurisdictional purposes where the plaintiff does not
plead or otherwise offer evidence of any facts to establish how a defendant allegedly
used the corporation to perpetrate fraud. Booth v. Kontomitras, 485 S.W.3d 461,
483 (Tex. App.—Beaumont 2016, no pet.).
–39–
The primary evidence submitted by Anubis on the alter ego issue was
deposition testimony by Lanning about a company formed by one of his sons to
produce films called ForLan Underground. ForLan Underground was originally
named Philco Film Productions, Ltd. (“PFP”) and, from March 24, 2015 to February
14, 2018, PFP had no employees and no bank account. Lanning stated PFP was
“literally a company name” that “remained dormant until it was required to do
something for my son.” When asked why the company was given a name similar to
Philco’s, Lanning responded that “the hope was that we would be successful in the
same way as one hoped that Philco Films, Limited would be successful.” Lanning
continued by stating “the opposite” occurred and “[i]t was a dormant company that,
in the end, didn’t function.”
On appeal, Anubis attempts to use this testimony as evidence that Philco was
a “meaningless paper entity.” None of this testimony, however, concerned Philco.
It concerned only PFP. Anubis points to a reference to “Philco Film Productions,
Ltd.” in the 2013 contract between Philco and SCTVA as evidence of “a failure to
maintain corporate separateness” between PFP and Philco. When asked about this
reference, Lanning testified it was a typo and the contract shows he signed on behalf
of Philco. Additionally, the record suggests that PFP was not created until 2015.
Even if PFP existed in 2013, this evidence would go to show only a potential alter
ego relationship between Philco and PFP, not Philco and Lanning or Hobbs.
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Finally, Anubis relies on Lanning’s testimony that he and Hobbs used Philco
as “the vehicle” to seek financing for another Kubrick Film, and that he was
authorized to represent Philco as a producer despite no longer being an officer of the
company. Anubis argues that this testimony, “with no mention of corporate
formalities,” demonstrates an alter ego relationship. Lanning’s “failure to mention”
corporate formalities does not constitute proof that such formalities did not exist,
particularly when the deposition evidence Anubis submitted as proof contained no
questions posed to Lanning regarding corporate formalities. Nor does this testimony
show that Lanning or Hobbs used Philco for personal purposes. Indeed, Anubis
presented no evidence whatsoever regarding Philco’s operations. We conclude
Anubis failed to meet its burden to show an alter ego relationship such that Philco’s
alleged contacts with Texas could be attributed to Lanning and Hobbs.
This does not end our analysis, however. As Anubis correctly notes, even if
all of a corporate officer’s or employee’s contacts were performed in a corporate
capacity, the agent is not shielded from the exercise of specific jurisdiction if he
engaged in tortious or fraudulent conduct for which he may be held personally liable.
Tabacinic v. Frazier, 372 S.W.3d 658, 668 (Tex. App.—Dallas 2012, no pet.). In
this case, Anubis asserted three claims sounding in tort against Lanning and Hobbs:
unjust enrichment, fraud, and fraudulent transfer. But, as to each of these causes of
action, Anubis provides little, if any, explanation as to how these claims arise from
Lanning’s or Hobbs’s alleged contacts with Texas. For each claim, Anubis merely
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states “This cause of action is related to [Anubis’s] allegations concerning The
Downslope and Lanning and Hobbs’s intentional acts directed toward the forum.”
Specific jurisdiction requires us to analyze jurisdictional contacts on a claim-by-
claim basis. Moncrief Oil Int’l, Inc. v. OAO Gazprom, 414 S.W.3d 142, 150 (Tex.
2013). Anubis makes no argument, and cites no authority, to show how the trial
court had jurisdiction over its individual tort claims. When a party fails to adequately
brief a complaint, the issue is waived on appeal. Washington v. Bank of New York,
362 S.W.3d 853, 854–55 (Tex. App.—Dallas 2012, no pet.).
Furthermore, specific jurisdiction is not established merely because a
nonresident “directed a tort” at the forum state. Michiana v. Easy Livin' Country,
Inc. v. Holten, 168 S.W.3d 777, 790–92 (Tex.2005). Nor is injury to a forum
resident a sufficient connection to invoke jurisdiction. TV Azteca v. Ruiz, 490
S.W.3d 29, 42 (Tex. 2016). Our analysis looks to the defendant’s contacts with the
forum state itself, not the defendant’s contacts with persons who reside there. Id.The defendant’s conduct must connect him to the forum in a meaningful way. Id.For a Texas court to exercise specific jurisdiction over a defendant, the defendant's
purposeful contacts with the state must be substantially connected to the operative
facts of the litigation or form the basis of the cause of action. Old Republic, 549
S.W.3d at 559–60.
Anubis’s unjust enrichment claim, like its quantum meruit claim against Selig,
appears to be based upon the introduction of Selig to Philco. The evidence shows
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that it was Anubis’s choice to initiate discussions with Selig, a California resident,
and it was Selig who first approached Lanning and Hobbs. That Lanning and Hobbs
chose to respond to an unsolicited invitation to do business with a California resident
is not conduct with a meaningful connection to the State of Texas.
In its brief, Anubis points to a single alleged misrepresentation as the basis
for the trial court’s jurisdiction over its fraud claim. According to Anubis, Lanning
and Hobbs misrepresented that Philco had the rights to produce Downslope.
Anubis’s own evidence submitted in response to the special appearance included
documents showing the Kubrick estate authorized Philco, Lanning, and Hobbs to
“seek arrangements” for the production of Downslope. No party appears to dispute
that Philco had the capacity to enter into contracts for the production of Downslope
and Anubis’s primary claims against Lanning and Hobbs assume that it did.
Accordingly, Anubis has failed to demonstrate how this alleged “misrepresentation”
is substantially connected to the operative facts of the litigation or forms the basis of
a cause of action.
In its fraudulent transfer claim, Anubis alleged that, upon information and
belief, Philco orchestrated the transfer of its rights in the Downslope project to PFP
and this transfer was made with the intent to defraud Anubis. Anubis makes no
argument to show how the alleged transfer of an asset from one European company
to another, assuming it occurred, creates sufficient contact with the State of Texas
to make Lanning and Hobbs subject to jurisdiction. See Ruiz, 490 S.W.3d at 43
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(courts cannot base specific jurisdiction on fact that defendant knows brunt of injury
will be felt by particular resident in forum state). Because Philco’s contacts cannot
be attributed to Lanning and Hobbs, and Anubis failed to show sufficient
jurisdictional contacts giving rise to its tort claims against the men, we conclude the
trial court did not err in granting Lanning and Hobbs’s special appearance.
Motion for Sanctions
In her cross-appeal, Selig contends the trial court abused its discretion in
refusing to grant her motion for sanctions against Anubis and its counsel. Selig
argues that rule 13 of the Texas Rules of Civil Procedure mandates an award of
sanctions because Anubis and its counsel knew the claims asserted against her were
groundless when they were filed and this suit was brought in bad faith and solely for
the purpose of harassment.
Rule 13 authorizes the imposition of sanctions against an attorney, a party, or
both, who filed a pleading that is: (1) groundless and brought in bad faith; or (2)
groundless and brought to harass. See TEX. R. CIV. P. 13. Courts presume that
pleadings, motions, and other papers are filed in good faith, and the party moving
for sanctions has the burden of overcoming this presumption. GTE Commc’n Sys.
Corp. v. Tanner, 856 S.W.2d 725, 731 (Tex. 1993). A pleading is “groundless” if it
has no basis in law or fact and is not warranted by a good faith argument for the
extension, modification, or reversal of existing law. TEX. R. CIV. P. 13; Thielmann
v. Kethan, 371 S.W.3d 286, 294 (Tex. App.—Houston [1st Dist.] 2012, pet. denied).
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“Bad faith” requires the conscious doing of a wrong for a dishonest, discriminatory,
or malicious purpose. Stites v. Gillum, 872 S.W.2d 786, 794–96 (Tex. App.—Fort
Worth 1994, writ denied). A party acts in bad faith if he has been put on notice that
his understanding of the facts may be incorrect and he does not make reasonable
inquiry before pursuing the claim further. Robson v. Gilbreath, 267 S.W.3d 401,
407 (Tex. App.—Austin 2008, pet. denied). Bad faith does not exist when a party
merely exercises bad judgment or is negligent. Thielmann, 371 S.W.3d at 294. To
“harass” means to annoy, alarm, and verbally abuse another person. Id.
In deciding whether a pleading was filed in bad faith or for the purpose of
harassment, the trial court is required to consider the acts or omissions of the
represented party or counsel, not merely the legal merit of a pleading or motion.
Parker v. Walton, 233 S.W.3d 535, 540 (Tex. App.—Houston [14th Dist.] 2007, no
pet.). The court examines the signer’s credibility, taking into consideration all the
facts and circumstances available at the time of the filing, and it may consider the
entire history of the case before it. Home Owners Funding Corp. of Am. v.
Scheppler, 815 S.W.2d 884, 889 (Tex. App.—Corpus Christi–Edinburg 1991, no
writ); Great W. Drilling, Ltd. v. Alexander, 305 S.W.3d 688, 698 (Tex. App.—
Eastland 2009, no pet). Ultimately, the trial court is in the best position to determine
whether sanctionable conduct has occurred and a decision not to impose sanctions
generally will not be reversed for an abuse of discretion. See Manning v. Enbridge
Pipelines (East Tx.) L.P., 345 S.W.3d 718, 728 (Tex. App.—Beaumont 2011, pet.
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denied); Allstate Ins. Co. v. Garcia, No. 13-02-092-CV, 2003 WL 21674766, at *2
(Tex. App.—Corpus Christi–Edinburg 2003, no pet.) (mem. op.).
Although Selig was successful in having Anubis’s claims against her
dismissed, she made no showing that Anubis made statements in its pleadings that
it knew to be false. The parties simply had different interpretations of the legal effect
of the facts. Anubis has made extensive arguments to support its positions and, while
we have concluded those arguments are without merit, we do not view them as
frivolous.
Selig points to an email exchange between Anubis and CMA Entertainment
in July 2014 to show that the purpose of the lawsuit was solely to harass her. In the
email exchange, Brownlee and Troy Allen with CMA discussed how to
communicate with Selig and Philco about the Downslope Project following Philco’s
termination of its relationship with Anubis. Brownlee stated he thought it would be
good for CMA to “weigh in officially” on the situation to show that Anubis and
CMA are “communicating and acting as one party.” Brownlee also stated he wanted
a paper trail. In response to a question from Allen regarding whether CMA should
respond to an email chain on which they had been blind copied, Brownlee responded,
“I actually think you should write an entirely new email. This way they will have
multiple points of contact to deal with and not just one party. Let’s make this as
difficult as possible for them.”
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Selig focuses on the last sentence in this exchange to argue that the sole
purpose of this lawsuit was to make things “as difficult as possible” for her. The
trial court was within its discretion, however, to conclude that Brownlee’s statement
did not reflect a belief that Anubis had no valid claims against Selig, but rather his
belief that it did, combined with a desire to force Selig and Philco to explain their
actions to multiple parties. Sanctions should only be assessed “in those egregious
situations where the worst of the bar uses our honored system for ill motive without
regard to reason and the guiding principles of the law.” Thielemann, 371 S.W.3d at
295 (quoting Dyson Descendant Corp. v. Sonat Expl. Co., 861 S.W.2d 942, 951
(Tex. App.—Houston [1st Dist.] 1993, no writ). Based on the record before us, we
cannot conclude the trial court abused its discretion in refusing to award sanctions.
We affirm the trial court’s judgments and orders.
/Amanda L. Reichek/
AMANDA L. REICHEK
JUSTICE
190817F.P05
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S
Court of Appeals
Fifth District of Texas at Dallas
JUDGMENT
ANUBIS PICTURES, LLC AND On Appeal from the 162nd Judicial
CMA FILMS, LLC, Appellants District Court, Dallas County, Texas
Trial Court Cause No. DC-17-17579.
No. 05-19-00817-CV V. Opinion delivered by Justice
Reichek. Justice Pedersen, III
LAUREN SELIG, SHAKE & BAKE participating.
PRODUCTIONS, STEPHEN
LANNING, AND PHILIP HOBBS,
Appellees
In accordance with this Court’s opinion of this date, we AFFIRM (1) the
judgments of the trial court dismissing the claims made by ANUBIS PICTURES,
LLC and CMA FILMS, LLC against LAUREN SELIG and SHAKE & BAKE
PRODUCTIONS, (2) the order of the trial court granting the special appearances of
STEPHEN LANNING and PHILIP HOBBS, and (3) the order of the trial court
denying the motion for sanctions brought by LAUREN SELIG and SHAKE &
BAKE PRODUCTIONS against ANUBIS PICTURES, LLC and its counsel.
It is ORDERED that each party bear its own costs of this appeal.
Judgment entered March 3, 2021
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