631 S.W.3d 299
Tex. App.2020Background
- Reeves worked for Harbor America under an employment agreement containing non-compete, non-solicitation, and confidentiality provisions.
- Reeves allegedly converted to an independent-contractor status and claimed entitlement to ongoing commissions; after he resigned in August 2016 he formed a competing company, Harvest Works, and sued Harbor for unpaid commissions.
- Harbor counterclaimed for breach of contract, misappropriation of trade secrets, conversion, breach of fiduciary duty, and breach of the duty of loyalty, alleging Reeves used confidential information and solicited customers.
- Reeves moved to dismiss Harbor’s counterclaims under the Texas Citizens Participation Act (TCPA), arguing his conduct implicated the right of association; the trial court denied the motion and this court reversed in a prior interlocutory appeal for failure to apply the TCPA framework.
- On remand Harbor briefed only the TCPA’s applicability (first-step) and the trial court again denied Reeves’s motion, concluding the TCPA did not apply to attempts to enforce non-competes; Reeves appealed.
- This opinion holds the TCPA applies to all of Harbor America’s counterclaims but remands because the trial court did not address the TCPA’s second-step evidentiary showing (prima facie proof) by the non-movant.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the TCPA applies to Harbor America’s counterclaims | Harbor: claims to enforce non-compete/trade-secret protections are not TCPA-protected and TCPA would conflict with TUTSA and CNCA | Reeves: his conduct in forming a competing business and soliciting customers implicated the right of association and involved protected communications | Court: TCPA applies to all counterclaims; no categorical exemption for non-compete or trade-secret claims |
| Whether the counterclaims concern a "communication" under the TCPA | Harbor: claims (especially conversion) are not premised on communications | Reeves: the alleged misappropriation and solicitation necessarily involved communications with others/customers | Court: breach, misappropriation, and fiduciary claims involve communications; conversion was sufficiently related to communications; TCPA coverage satisfied |
| Whether applying TCPA conflicts with TUTSA or CNCA (injunctive remedies, procedures, fee rules) | Harbor: TCPA would undermine statutory injunctive rights, protective procedures, and differing fee standards | Reeves: statutes govern different litigation stages; TCPA provides an early dismissal mechanism and does not abrogate injunctive or protective remedies | Court: No irreconcilable conflict; parties may still seek injunctions/protective orders before a TCPA appeal; statutes operate at different stages |
| Remedy when non-movant did not present second-step evidence | Harbor: remand to allow Harbor to make a prima facie evidentiary showing | Reeves: render dismissal of Harbor’s TCPA-covered claims | Court: Remand for trial court to consider the TCPA second-step because the trial court did not address the merits on remand |
Key Cases Cited
- In re Lipsky, 460 S.W.3d 579 (Tex. 2015) (describing TCPA purpose and expedited dismissal mechanism)
- Elite Auto Body LLC v. Autocraft Bodywerks, Inc., 520 S.W.3d 191 (Tex. App.—Austin 2017) (communications in furtherance of a business can implicate the right of association under the TCPA)
- Reeves v. Harbor America Central, Inc., 552 S.W.3d 389 (Tex. App.—Houston [14th Dist.] 2018) (prior appeal reversing trial court for failing to apply TCPA framework)
- Adams v. Starside Custom Builders, LLC, 547 S.W.3d 890 (Tex. 2018) (TCPA construed liberally to effectuate its purpose)
- ExxonMobil Pipeline Co. v. Coleman, 512 S.W.3d 895 (Tex. 2017) (per curiam) (TCPA construction precedent)
- Cavin v. Abbott, 545 S.W.3d 47 (Tex. App.—Austin 2017) (acts not facially communications may still relate to TCPA-protected communications)