BancPass, Inc. v. Highway Toll Administration, L.L.C.
2017 U.S. App. LEXIS 12595
| 5th Cir. | 2017Background
- HTA and BancPass are competing toll-management companies; BancPass developed a PToll app allowing users (including rental-car customers) to register plates temporarily on BancPass’s fleet to pay tolls.
- HTA sent three pre-litigation communications: (1) a letter to TxDOT expressing concern and hinting at legal action; (2) letters from outside counsel to Apple and Google demanding removal of the PToll App and accusing BancPass of illegal conduct; and (3) a direct threat of legal action to BancPass. BancPass did not receive copies of the TxDOT/Apple/Google letters before suit.
- BancPass sued for a declaratory judgment; after discovery revealing HTA’s letters, BancPass amended to add a defamation claim based on the letters. HTA counterclaimed for tortious interference and later moved for summary judgment, asserting Texas’s judicial proceedings (litigation) privilege as absolute immunity.
- The district court denied HTA’s summary judgment, concluding the communications were not protected by the privilege. HTA filed an interlocutory appeal of that denial.
- BancPass moved to dismiss the appeal for lack of jurisdiction and alternatively argued forfeiture of HTA’s interlocutory appeal as a litigation tactic; the Fifth Circuit denied dismissal and proceeded to the merits.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the Fifth Circuit has jurisdiction to hear an interlocutory appeal of a denial of summary judgment based on Texas’s judicial proceedings privilege | Appeal lacks jurisdiction because statements were out-of-court and not made during an ongoing judicial proceeding | Under Shanks, denial of Texas judicial-proceedings privilege is immediately appealable as an immunity-from-suit collateral order | Court: Jurisdiction exists under collateral-order doctrine; Shanks controls |
| Whether the district court could retain jurisdiction after HTA filed a notice of appeal because HTA’s appeal was a litigation tactic (forfeiture/Dunbar rule) | HTA forfeited right to interlocutory appeal; district court’s comments suffice to keep trial on track | Dunbar-style certification required; district court did not make written finding of frivolousness so appeal stands | Court: Denied forfeiture; district court did not make required written certification, so appeal proceeds |
| Whether HTA’s pre-suit communications are absolutely privileged under Texas’s judicial proceedings privilege | The letters were defamatory and not tied to a judicial proceeding; privilege does not apply | Communications were preliminary to contemplated tortious-interference litigation and thus absolutely privileged under Texas law | Court: Held privilege does not apply because communications lacked sufficient relation to the contemplated judicial proceeding and recipients had no direct interest in that litigation |
| Whether statements to third parties (TxDOT, Apple, Google) can be privileged when litigation was only contemplated | Privilege should not shield dissemination to third parties who lack direct legal interest | HTA: privilege extends to communications preliminary to a proposed proceeding and can cover third parties if related to litigation | Court: Held recipient relationship matters; these third parties lacked cognizable legal interest and communications were too attenuated to the contemplated suit |
Key Cases Cited
- Shanks v. Allied-Signal, Inc., 169 F.3d 988 (5th Cir. 1999) (Texas judicial-proceedings privilege treated as complete immunity and denial immediately appealable)
- Mitchell v. Forsyth, 472 U.S. 511 (U.S. 1985) (immunity from suit protects right not to stand trial and supports collateral-order appeals)
- Burzynski v. Aetna Life Ins. Co., 967 F.2d 1063 (5th Cir. 1992) (denied privilege where communications to third parties were aimed at dissuading business and recipients had hypothetical interest)
- James v. Brown, 637 S.W.2d 914 (Tex. 1982) (absolute privilege covers communications made in the due course of judicial proceedings)
- Shell Oil Co. v. Writt, 464 S.W.3d 650 (Tex. 2015) (Texas courts rely on Restatement formulation of litigation privilege)
- Troice v. Proskauer Rose, L.L.P., 816 F.3d 341 (6th Cir. 2016) (recognizing Shanks and appealability of Texas litigation-privilege denials)