524 S.W.3d 770
Tex. App.2017Background
- QTAT BPO Solutions (contractor) was hired to screen medical records by L&R Services, an entity serving law firms Lee & Murphy and Clark, Love & Hutson (the Law Firms); QTAT signed a non-disclosure agreement restricting client/proprietary data disclosure.
- After termination, QTAT claimed underpayment and sued the Law Firms and related parties for fraud, breach of contract, and related claims; defendants counterclaimed that QTAT breached the NDA by providing a spreadsheet of client data to QTAT’s attorney (Neese).
- QTAT moved to dismiss the counterclaims under the Texas Citizens Participation Act (TCPA), asserting the disclosure to its lawyer was protected activity (free speech and petition rights); trial court granted dismissal as to some defendants but denied dismissal as to the two Law Firms.
- QTAT appealed interlocutorily under section 51.014(a)(12), challenging the denial as to the Law Firms; key disputed points were whether the TCPA applies to private breach-of-contract counterclaims and whether pre-suit disclosures to counsel are "in or pertaining to a judicial proceeding."
- The court examined whether QTAT met the TCPA movant burden (preponderance) to show the counterclaims were based on, related to, or in response to QTAT’s exercise of rights under the TCPA; it concluded QTAT failed to meet that burden.
- Because this court is bound by Jardin v. Marklund (panel precedent), the court held that if the movant fails to show the TCPA applies, the court lacks appellate jurisdiction over the interlocutory denial and thus dismissed the appeal for lack of jurisdiction.
Issues
| Issue | Plaintiff's Argument (QTAT) | Defendant's Argument (Law Firms) | Held |
|---|---|---|---|
| Whether TCPA applies to Law Firms’ breach-of-NDA counterclaims | Disclosure to counsel was protected petition/speech (investigatory, pertains to judicial proceeding; attorney ethics = public concern) | TCPA does not apply; claims are ordinary contract claims independent of QTAT’s alleged protected activity | Held: QTAT failed to show TCPA applies; counterclaims do not implicate TCPA |
| Whether sharing confidential client data with counsel is protected free-speech (matter of public concern) | Communications to attorney about alleged fraud implicate public concern (attorney ethics) | The communications concerned private contract/discrete client data (HIPAA-protected) and are not public concern | Held: QTAT waived any free-speech argument; court did not find TCPA coverage on this ground |
| Whether pre-suit disclosure to counsel is a communication "in or pertaining to a judicial proceeding" (petition right) | Providing data to counsel to prepare suit is integral to petitioning and thus protected; corporations must consult counsel before filing | Pre-suit investigatory communications are not "judicial proceedings"; Rule 13’s reasonable inquiry does not justify breaching an NDA; discovery rules provide proper pre-suit mechanisms | Held: Pre-suit disclosure to counsel here is not "in or pertaining to a judicial proceeding"; TCPA petition protection not shown |
| Appellate jurisdiction to review denial of TCPA dismissal | QTAT sought interlocutory review under §51.014(a)(12) | Law Firms argued TCPA inapplicable; trial court made no express finding that TCPA applied to claims against Law Firms | Held: Under Jardin v. Marklund, because QTAT did not show TCPA applies, this court lacks jurisdiction; appeal dismissed for lack of jurisdiction |
Key Cases Cited
- Deaver v. Desai, 483 S.W.3d 668 (Tex. App.—Houston [14th Dist.] 2015) (de novo review standard for whether movant met TCPA burden)
- Jardin v. Marklund, 431 S.W.3d 765 (Tex. App.—Houston [14th Dist.] 2014) (panel holding that appellate jurisdiction under §51.014(a)(12) is lacking if movant fails to show TCPA applies)
- Levatino v. Apple Tree Café Touring, Inc., 486 S.W.3d 724 (Tex. App.—Dallas 2016) (pre-suit demand letters do not fall within ordinary meaning of "judicial proceeding")
- Knox v. Taylor, 992 S.W.2d 40 (Tex. App.—Houston [14th Dist.] 1999) (discussing absolute judicial-communications privilege)
- Daystar Residential, Inc. v. Collmer, 176 S.W.3d 24 (Tex. App.—Houston [1st Dist.] 2004) (absolute privilege extends to statements made in contemplation of judicial proceedings)
- Mattly v. Spiegel, Inc., 19 S.W.3d 890 (Tex. App.—Houston [14th Dist.] 2000) (definition of "reasonable inquiry" under signing rules)
- Glassman v. Goodfriend, 347 S.W.3d 772 (Tex. App.—Houston [14th Dist.] 2011) (panel court bound by earlier panel precedent absent higher-court guidance)