580 S.W.3d 136
Tex.2019Background
- Agar Corporation sued multiple defendants alleging a scheme to steal and sell its measuring-device technology; Electro Circuits and its owner Parikh were added in Nov. 2011 and accused of manufacturing knock-off circuit boards using Agar’s proprietary information.
- Agar’s seventh amended petition (Feb. 10, 2012) pleaded numerous direct torts (fraud, breach of fiduciary duty, conversion, misappropriation of trade secrets, Texas Theft Liability Act claim, etc.) and civil-conspiracy claims based on those underlying torts.
- Electro moved for traditional and no‑evidence summary judgment; the trial court granted no‑evidence summary judgment on Agar’s direct claims, denied no‑evidence as to conspiracy, and granted traditional summary judgment as to statute‑of‑limitations on Agar’s conspiracy claims; Electro later obtained fees under the TTLA after a separate no‑evidence ruling on the TTLA claim.
- The court of appeals affirmed, applying a uniform two‑year statute of limitations (Tex. Civ. Prac. & Rem. Code § 16.003) to civil conspiracy claims; Agar sought review, arguing the limitations period should track the underlying tort.
- The Texas Supreme Court considered (1) whether civil conspiracy is an independent tort or a derivative/vicarious theory and (2) when a conspiracy claim accrues (and whether the discovery rule applies), and also reviewed the TTLA fees award to Electro.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Applicable statute of limitations for civil conspiracy | Civil‑conspiracy limitations should match the limitations of the underlying tort (conspiracy is derivative/vicarious). | Civil conspiracy is an independent tort (like trespass) subject to §16.003’s two‑year period. | Civil conspiracy is derivative; its limitations period is the same as the underlying tort relied upon. |
| When conspiracy claim accrues; role of last‑overt‑act | Accrual should run from last overt act of the conspiracy (so later acts can restart limitations). | Accrual runs when the underlying tort causes injury (i.e., same time as the underlying claim). | Accrual occurs when each underlying tort causes injury; each underlying tort accrues separately (rejects last‑overt‑act rule). |
| Discovery rule tolling for later discovered overt acts | Discovery of later overt acts (e.g., 2009 purchase order produced in 2011) tolls accrual under the discovery rule. | Discovery rule not triggered because the relevant underlying torts accrued earlier and were discoverable. | Discovery rule inapplicable here because alleged underlying torts accrued by April 2008; later discovery of additional damage does not reset accrual. |
| Award of attorney’s fees under Texas Theft Liability Act (TTLA) | Prevailing‑person fees under §134.005(b) should not extend to a prevailing defendant (or defendant who prevailed on limitations). | “Person who prevails” includes any prevailing party (plaintiff or defendant); Electro prevailed on the TTLA claim. | §134.005(b) unambiguously awards fees to any prevailing person; Electro prevailed (no‑evidence judgment) and the fees award was proper. |
Key Cases Cited
- Tilton v. Marshall, 925 S.W.2d 672 (Tex. 1996) (describing civil conspiracy as dependent on an underlying tort)
- Chu v. Hong, 249 S.W.3d 441 (Tex. 2008) (civil conspiracy characterized as derivative tort)
- Murray v. San Jacinto Agency, Inc., 800 S.W.2d 826 (Tex. 1990) (general accrual rule: cause of action accrues when wrongful act causes legal injury)
- Massey v. Armco Steel Co., 652 S.W.2d 932 (Tex. 1983) (elements of civil conspiracy set out)
- Schlumberger Well Surveying Corp. v. Nortex Oil & Gas Corp., 435 S.W.2d 854 (Tex. 1968) (damages derive from underlying wrongful act, not conspiracy itself)
- Harang v. Aetna Life Ins. Co., 400 S.W.2d 810 (Tex. Civ. App. 1966) (limitation on conspiracy claims runs from when the underlying tort occurs)
- Epps v. Fowler, 351 S.W.3d 862 (Tex. 2011) (defendant ‘‘prevails’’ when plaintiff loses with prejudice)
- Jose Carreras, M.D., P.A. v. Marroquin, 339 S.W.3d 68 (Tex. 2011) (statutory interpretation begins with statutory text)