Fourth Court of Appeals
San Antonio, Texas
MEMORANDUM OPINION
No. 04-17-00621-CV
HOLT TEXAS, LTD. d/b/a Holt Cat and d/b/a Holt Rental Services,
Appellant
v.
M&M CRUSHED STONE PRODUCTS, INC.,
Appellee
From the 57th Judicial District Court, Bexar County, Texas
Trial Court No. 2017-CI-07186
Honorable Antonia Arteaga, Judge Presiding
Opinion by: Sandee Bryan Marion, Chief Justice
Sitting: Sandee Bryan Marion, Chief Justice
Rebeca C. Martinez, Justice
Irene Rios, Justice
Delivered and Filed: August 22, 2018
REVERSED AND RENDERED; CAUSE REMANDED
Holt Texas, Ltd. d/b/a Holt Cat and d/b/a Holt Rental Services appeals the trial court’s
order denying its motion to dismiss filed pursuant to the Texas Citizens Participation Act also
known as the anti-SLAPP statute. Holt contends the trial court erred in denying its motion because
the tortious interference counterclaim asserted by appellee M&M Crushed Stone Products, Inc.
against it was based on, related to, or was in response to Holt’s right of free speech, right to petition,
or right of association. Holt further contends M&M failed to establish by clear and specific
evidence a prima facie case for each essential element of its tortious interference counterclaim.
04-17-00621-CV
We reverse the trial court’s order, dismiss the tortious interference counterclaim against Holt, 1 and
remand the cause for further proceedings.
BACKGROUND
In April of 2017, Holt sued M&M alleging claims on a sworn account and for breach of
contract and asserting M&M owed Holt $632,960.41 for “goods, wares, merchandise, services and
repairs” Holt provided to M&M. In July of 2017, M&M filed its original counterclaims against
Holt which included a tortious interference with prospective business relations claim. Only the
tortious interference with prospective business relations claim is the subject of this accelerated
appeal.
In its counterclaims, M&M alleged it entered into rental/purchase agreements with Holt
for services, parts, and repairs from 2012 to 2016, which agreements included equipment
protection plan warranties and maintenance agreements. During the course of these agreements,
M&M alleged Holt failed to: (1) provide equipment in working condition; (2) perform services on
equipment in a good and workmanlike manner; (3) provide accurate invoices and statements; (4)
comply with repair and maintenance obligations; (5) perform repair services properly; and (6)
provide equipment in good and working order. M&M’s pleadings specifically detail these alleged
failures with regard to several different pieces of equipment.
M&M further alleged it applied for a working capital loan from CAT Financial during the
second quarter of 2017, which M&M expected would be approved because CAT Financial had
provided prior equipment loans to M&M in excess of $1,400,000.00. In pleading its tortious
interference with prospective business relations claim, M&M alleged:
The formation of the contract between M&M Crushed Stone and Cat Financial
was reasonably probable considering all the facts and circumstances related to the
transaction. Holt had actual knowledge of the prospective business relation
1
This dismissal does not affect M&M’s other counterclaims that Holt did not challenge in its motion.
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between M&M Crushed Stone and Cat Financial and intentionally interfered with
that relationship. Holt’s conduct was independently tortious or unlawful. Holt’s
interference proximately caused M&M Crushed Stone’s injury and M&M Crushed
Stone has suffered actual damage or loss.
As previously noted, Holt filed a motion to dismiss pursuant to the TCPA requesting the
trial court to dismiss only M&M’s tortious interference with prospective business relations
counterclaim. Holt attached to its motion an affidavit from Roy Wahne, Holt’s Southern Regional
Credit Manager, and an affidavit from Terry Ludzenski, Holt’s Director of Financial Services.
In Wahne’s affidavit, he stated it is a common practice for him to give credit references
relating to Holt’s customers and to contact other vendors and suppliers of construction equipment
to seek credit references for Holt’s prospective customers. Wahne also stated he occasionally
provides credit references to and requests credit references from Caterpillar Financial Services
Corporation [CAT Financial], and “[t]he exchanging of credit references between companies is a
common business practice in the construction industry.” On or about May 2017, Wahne was
contacted by CAT Financial’s Territory Manager Manuel Esparrago asking for a credit reference
on M&M because M&M was seeking to borrow money from CAT Financial. Wahne stated, “I
informed Mr. Esparrago that M&M had an outstanding balance with Holt and that a lawsuit had
been filed.” “In the days following this brief inquiry,” Wahne stated he again spoke with Esparrago
and Ludzenski, Holt’s Director of Financial Services, and “reiterated only that M&M had an
outstanding balance with Holt and that a lawsuit had been filed.”
In his affidavit, Ludzenski also stated providing and seeking credit references is a common
practice, including exchanging credit references with CAT Financial. Ludzenski stated Esparrago
also contacted him on or about May 2017 seeking a credit reference on M&M. Ludzenski further
stated, “I informed Mr. Esparrago that M&M had an outstanding balance with Holt and that a
lawsuit had been filed.”
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In its response to Holt’s motion, M&M alleged it had worked with Holt to determine what
charges were proper “[f]or nearly a year.” M&M also alleged Holt was aware of its “severe
invoicing problems” and, as a result of their ongoing discussions, Holt issued a series of credits
for improper charges. In support of this allegation, M&M attached an internal email from a Holt
sales representative to Holt’s Quarry & Aggregates Industry Manager, dated April 21, 2016, in
which the sales representative stated, “This could serve as a lesson to the company of why our
invoicing structure/procedures are an embarrassment to the company.” The email also
acknowledged some credits would be owed due to billing errors. M&M’s response further alleged,
“Examining Holt’s invoices to determine what amounts, if any, were actually due and owing was
a tedious process — a process that was still underway when Holt abruptly filed suit on April 19,
2017.” This same statement is contained in an affidavit from Grecia Martinez, M&M’s chief
administrative officer, which was attached to M&M’s response.
With regard to CAT Financial, the response alleged M&M applied for a working capital
loan from CAT Financial in April of 2017, and CAT Financial had previously approved and
provided M&M several loans totaling more than $1,400,000.00. As evidence of its working
relationship with CAT Financial, M&M attached an email string between Esparrago and Wahne
dated July 29, 2016, in which Wahne requested a credit reference on M&M from CAT Financial.
In his response, Esparrago described M&M as an “excellent customer,” stated M&M made all
payments on time, and rated the character of M&M’s chief executive officer as an “A”. In her
affidavit, Martinez stated, “Based on its payment history and status and working relationship with
CAT Financial, M&M Crushed Stone was confident that this application would be approved.”
With regard to CAT Financial contacting Holt for a credit reference, M&M alleged:
In May 2017, CAT Financial contacted Holt to obtain a credit reference on
M&M Crushed Stone. With knowledge of the ongoing business relationship
between M&M Crushed Stone and CAT Financial and of the prospective working
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capital loan by CAT Financial to M&M Crushed Stone, Holt intentionally
interfered with M&M Crushed Stone’s relationship with CAT Financial by, among
other things, failing to inform CAT Financial (1) of Holt’s repeated issues with
improper and inaccurate invoicing; (2) that Holt had internally acknowledged its
problematic invoicing procedures and questioned why anyone would want to do
business with Holt; (3) that Holt and M&M Crushed Stone had for months engaged
in countless in-person meetings, telephone calls and emails to try to resolve the
problems with the invoices Holt submitted to M&M Crushed Stone; or (4) Holt’s
repeated misrepresentation, improper invoicing, and failure to comply with
contractual obligations and other duties on M&M Crushed Stone’s account.
Instead, Holt misrepresented to CAT Financial that M&M Crushed Stone’s account
was overdue. As a result of Holt’s independently tortious or unlawful conduct,
CAT Financial denied M&M Crushed Stone’s application for a working capital
loan, which proximately caused M&M Crushed Stone damages.
In her affidavit, Martinez stated, “Because of Holt’s interference, CAT Financial denied M&M
Crushed Stone’s application for a working capital loan in May 2017.”
After considering the motion, the response, and arguments made by counsel at a hearing,
the trial court denied Holt’s motion. Holt appeals.
THE TEXAS CITIZENS PARTICIPATION ACT AND STANDARD OF REVIEW
“[T]he Texas Citizens Participation Act or TCPA protects citizens from retaliatory lawsuits
that seek to intimidate or silence them on matters of public concern.” In re Lipsky, 460 S.W.3d
579, 586 (Tex. 2015). “The Act provides a special procedure for the expedited dismissal of such
suits.” Id. “Reviewing a TCPA motion to dismiss requires a three-step analysis.” Youngkin v.
Hines, 546 S.W.3d 675, 679 (Tex. 2018).
When a defendant files a motion to dismiss under the TCPA, the defendant-movant has the
initial burden to show by a preponderance of the evidence that the TCPA applies because the
plaintiff’s claim is based on, relates to, or is in response to the defendant-movant’s exercise of: (1)
the right of free speech; (2) the right to petition; or (3) the right of association. TEX. CIV. PRAC. &
REM. CODE ANN. § 27.005(b) (West 2015); Youngkin, 546 S.W.3d at 679; In re Lipsky, 460 S.W.3d
at 586-87. “If the movant is able to demonstrate that the plaintiff’s claim implicates one of these
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rights, the [next] step shifts the burden to the plaintiff to ‘establish [ ] by clear and specific evidence
a prima facie case for each essential element of the claim in question.’” In re Lipsky, 460 S.W.3d
at 587 (quoting TEX. CIV. PRAC. & REM. CODE ANN. § 27.005(c)). Finally, if the plaintiff meets
its burden to establish a prima facie case, the trial court must still dismiss the claim if the defendant-
movant “establishes by a preponderance of the evidence each essential element of a valid defense
to the nonmovant’s claim.” TEX. CIV. PRAC. & REM. CODE ANN. § 27.005(d). We review the trial
court’s ruling on a TCPA motion to dismiss de novo. Adams v. Starside Custom Builders, LLC,
547 S.W.3d 890, 897 (Tex. 2018); Herrera v. Stahl, 441 S.W.3d 739, 741 (Tex. App.—San
Antonio 2014, no pet.).
In determining whether the plaintiff’s claim should be dismissed, the court is to consider
the pleadings and any supporting and opposing affidavits. TEX. CIV. PRAC. & REM. CODE ANN.
§ 27.006(a); see also Adams, 547 S.W.3d at 892. Both the trial court and this court are required
to consider the pleadings and evidence in the light most favorable to M&M. See Mission Wrecker
Serv., S.A., Inc. v. Assured Towing, Inc., No. 04-17-00006-CV, 2017 WL 3270358, at *1 (Tex.
App.—San Antonio Aug. 2, 2017, pet. denied) (mem. op.); see also Rio Grande H2O Guardian v.
Robert Muller Family P’ship Ltd., No. 04-13-00441-CV, 2014 WL 309776, at *3 (Tex. App.—
San Antonio Jan. 29, 2014, no pet.) (mem. op.) (noting “[u]nlike other types of cases where
pleadings are not considered evidence, section 27.006 . . . expressly provides” that “we may
consider the pleadings as evidence”).
APPLICABILITY OF THE TCPA
Holt asserts it met its burden to establish M&M’s tortious interference counterclaim is
based on, relates to, or is in response to Holt’s exercise of: (1) the right of free speech; (2) the right
to petition; or (3) the right of association. Because we hold Holt met its burden relating to its right
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of free speech, we do not address whether the tortious interference claim also was based on, related
to, or was in response to Holt’s exercise of the other rights.
“The TCPA provides its own definition of ‘exercise of the right of free speech,’” which “is
not fully coextensive with the constitutional free-speech right protected by” the United States and
Texas Constitutions. Adams, 547 S.W.3d at 892. The TCPA defines the “exercise of the right of
free speech” to mean “a communication made in connection with a matter of public concern.”
TEX. CIV. PRAC. & REM. CODE ANN. § 27.001(3) (West 2015). The TCPA further defines “matter
of public concern” to include “an issue related to: (A) health or safety; (B) environmental,
economic, or community well-being; (C) the government; (D) a public official or public figure; or
(E) a good, product, or service in the marketplace.” Id. § 27.001(7).
“[W]hen construing the TCPA’s ‘right of free speech’ prong, ‘the plain language of the
[TCPA] merely limits its scope to communications involving a public subject — not
communications in public forum.’” ExxonMobil Pipeline Co. v. Coleman, 512 S.W.3d 895, 899
(Tex. 2017) (quoting Lippincott v. Whisenhunt, 462 S.W.3d 507, 508 (Tex. 2015)). As a result,
the TCPA encompasses both public and private communication. Id. “The TCPA does not require
that the statements specifically ‘mention’ [public] concerns, nor does it require more than a
‘tangential relationship’ to the same; rather, TCPA applicability requires only that the defendant’s
statements are ‘in connection with’ ‘issue[s] related to’ health, safety, environmental, economic,
and other identified matters of public concern chosen by the Legislature.” Id. at 900.
Our analysis of whether Holt’s communication was in connection with a matter of public
concern is guided by our sister court’s decision in MVS Int’l Corp. v. Int’l Advertising Solutions,
LLC, 545 S.W.3d 180 (Tex. App.—El Paso 2017, no pet.). In MVS Int’l Corp., MVS International
Corp., which ran a radio station, sued two advertising agencies for amounts owed for unpaid
advertising and other services. Id. at 186-87. The two advertising agencies filed counterclaims
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and third party claims alleging MVS and its general manager and Southwest University and its
principals developed a plan to injure the agencies’ credit and business by falsifying charges owed
and reporting the bad debt along with other disparaging comments to others in the industry who
stopped doing business with the agencies. Id. at 187-88. Although the trial court denied MVS’s
TCPA motion to dismiss as moot, the El Paso court disagreed with that conclusion and addressed
the merits of the motion. Id. at 186.
In addressing the applicability of the TCPA to one of the claims alleged by the agencies,
the El Paso court noted the TCPA applies to communications made in connection with a matter of
public concern which is defined to include a good, product, or service in the marketplace. Id. at
193. The El Paso court further noted the agencies sold a service to customers and “[b]y allegedly
informing other media outlets that [the agencies] do not pay their accounts, Appellants made a
communication ‘in connection with’ a ‘service’ in the relevant marketplace.” Id. at 193-94. The
El Paso court reasoned:
Few would doubt an end consumer’s right to communicate about the quality (or
lack thereof) of businesses in the marketplace. Conversely, businesses have a
corresponding right to communicate between themselves about customers, or
potential customers. Otherwise, a bank could never inform other financial
institutions that a putative borrower chronically defaults on loans, or a merchant
could never warn other stores of serial shoplifters. To be sure, the information
provided must be truthful, but this free flow of accurate information is essential to
an efficient marketplace. Stripping away the falsity component of the allegation,
Appellants here have done no more than warn other media outlets about potential
customers who (allegedly) do not pay their accounts.
Id. at 194 (internal citations omitted). Specifically in regard to the agencies’ claim for tortious
interference with business relations, the El Paso court reasoned, “An essential allegation in the
claim is a communication by Appellants to third parties about the [agencies’] fidelity in paying
bills, which implicates the exercise of free speech.” Id. at 199. Accordingly, the El Paso court
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held the agencies’ claims were based on, related to, or in response to the appellants’ exercise of
the right of free speech.
In the instant case, it is undisputed that M&M sells services to customers for crushing,
screening, drilling, blasting, and mining aggregate, including stone. By responding to CAT
Financial’s request for a credit reference regarding M&M, Holt “made a communication ‘in
connection with’ a ‘service’ in the relevant marketplace.” See id. at 194. This is in keeping with
the right businesses have “to communicate between themselves about customers.” Id. In fact, the
email exchange between Esparrago and Wahne in July of 2016, which M&M attached to its
response, demonstrates credit references are routinely exchanged in the industry. Therefore, we
hold Holt satisfied its initial burden of showing the TCPA is applicable to M&M’s tortious
interference counterclaim because that claim is based on, relates to, or is in response to Holt’s
exercise of the right of free speech. See id.; see also Adams, 547 S.W.3d at 895 (holding
communication alleging company had “unpaid creditors” related to company’s provision of
services in the marketplace).
PRIMA FACIE CASE
Because Holt met its initial burden, the burden shifted to M&M to establish by clear and
specific evidence a prima facie case for each essential element of its tortious interference
counterclaim.
“[A] prima facie case represents the minimum quantity of evidence necessary to support a
rational inference that the allegation of fact is true.” Harwood v. Gilroy, No. 04-16-00652-CV,
2017 WL 2791321, at *3 (Tex. App.—San Antonio June 28, 2017, no pet.) (mem. op.) (internal
quotation omitted); see also In re Lipsky, 460 S.W.3d at 590 (same). The TCPA does not define
the phrase “clear and specific evidence,” which is the standard the plaintiff must meet in
establishing a prima facie case for each essential element of the plaintiff’s claims. See In re Lipsky,
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460 S.W.3d at 590. The Texas Supreme Court, however, has held the standard requires more than
mere notice pleadings and that the “plaintiff must provide enough detail to show the factual basis
for its claim.” Id. at 590-91. “Conclusory statements are not probative and accordingly will not
suffice to establish a prima facie case.” Harwood, 2017 WL 2791321, at *5.
To prevail on a claim for tortious interference with prospective business relations, the
plaintiff must establish that (1) there was a reasonable probability that the plaintiff would have
entered into a business relationship with a third party; (2) the defendant either acted with a
conscious desire to prevent the relationship from occurring or knew the interference was certain
or substantially certain to occur as a result of the conduct; (3) the defendant’s conduct was
independently tortious or unlawful; (4) the interference proximately caused the plaintiff injury;
and (5) the plaintiff suffered actual damage or loss as a result. Coinmach Corp. v. Aspenwood
Apartment Corp., 417 S.W.3d 909, 923 (Tex. 2013); MVS Int’l Corp., 545 S.W.3d at 199;
Duradril, L.L.C. v. Dynomax Drilling Tools, Inc., 516 S.W.3d 147, 168 (Tex. App.—Houston
[14th Dist.] 2017, no pet.).
In this case, neither M&M’s pleadings nor the evidence it produced provide sufficient
detail to establish the causation element of its tortious interference claim. Instead, both the
allegations in its pleadings and Martinez’s affidavit do nothing more than conclusively state CAT
Financial denied the loan due to Holt’s response to CAT Financial’s request for a credit reference.
See In re Lipsky, 460 S.W.3d at 590-91 (“[G]eneral allegations that merely recite the elements of
a cause of action [] will not suffice.”); Hicks v. Grp. & Pension Adm’rs, Inc., 473 S.W.3d 518, 535
(Tex. App.—Corpus Christi 2015, no pet.) (allegation that defendants’ interference caused third
party not to award contract to plaintiff failed to establish prima facie case on essential element of
causation in claim for tortious interference with prospective business relations). The fact that the
credit reference occurred roughly contemporaneously with CAT Financial’s decision does not
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establish Holt’s credit reference caused CAT Financial to decline the loan. See Schimmel v.
McGregor, 438 S.W.3d 847, 860-61 (Tex. App.—Houston [1st Dist.] 2014, pet. denied) (“The fact
that Schimmel’s alleged conduct occurred roughly contemporaneously with the City of
Galveston’s and the Department of Public Safety’s consideration of whether to move forward with
the purchases does not establish that Schimmel’s conduct caused the governmental agencies to act
as they did.”) (emphasis in original); see also Van Der Linden v. Khan, 535 S.W.3d 179, 195 (Tex.
App.—Fort Worth 2017, pet. filed) (“Given the temporal proximity between the Message and
Sheldon’s decision not to go forward with the contract, one might suspect that the Message
factored into Sheldon’s decision. But just as conjecture, guess, or speculation will not survive a
proximate cause sufficiency challenge in the summary judgment context, conjecture, guess, or
speculation cannot survive ‘clear and specific’ scrutiny under chapter 27.”); MJS & Assocs., L.L.C.
v. Master, 501 S.W.3d 751, 758 (Tex. App.—Tyler 2016, pet. denied) (“The mere fact that LHC
terminated its contract three days after MJS disclosed documents is not evidence of a causal link.
Such a leap would be speculation.”). M&M did not present any affidavits from CAT Financial’s
representatives regarding the reason for its decision. See Khan, 535 S.W.3d at 195 (“Khan did not
offer affidavit testimony from Sheldon, the one person who personally knew why he refused to go
forward with the alleged contract.”); see also Schimmel, 438 S.W.3d at 860 (noting absence of any
affidavits or admissible evidence from decision-maker). Instead, the only evidence presented by
M&M was an email from Martinez to Esparrago dated May 31, 2017, stating, “Based upon his last
conversation with you, Patrick believes that CAT Financial has declined our application for a
working capital line of credit. Please provide M&M with a final written determination of our
application for our files,” and Esparrago’s email response stating, “Unfortunately you are correct,
at this time we are not able to provide a working capital LOC. I tried to call Pat to discuss.” This
evidence lacks any clear and specific details of the reasons for CAT Financial’s decision. Instead,
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the pleading and evidence in this case are similar to the affidavit and petition presented by the
agencies in MVS Int’l Corp. in support of their tortious interference claim. In that case, the
affidavit stated a current customer stopped doing business with the agencies when told the
agencies’ principal failed to apply a payment towards the customer’s account with MVS. MVS
Int’l Corp., 545 S.W.3d at 200. The El Paso court concluded, “The claim that [the customer]
ceased doing business because of the alleged statement is also conclusory.” Id. Similarly, because
the pleadings and evidence produced by M&M on the causation element of its claim are conclusory
and constitute no more than general allegations, we hold M&M failed to satisfy its burden to show
by clear and specific evidence a prima facie case for its tortious interference counterclaim.
CONCLUSION
Because the TCPA was applicable to M&M’s counterclaim for tortious interference with
prospective business relations but M&M did not establish by clear and specific evidence a prima
facie case for that claim, the trial court erred in denying Holt’s motion to dismiss. Therefore, we
reverse the trial court’s order and dismiss M&M’s counterclaim for tortious interference with
prospective business relations against Holt. The cause is remanded to the trial court to determine
the amount Holt should be awarded under section 27.009(a) of the TCPA. See Youngkin, 546
S.W.3d at 683 (remanding for reconsideration of award under section 27.009(a)); Sullivan v.
Abraham, 488 S.W.3d 294, 299 (Tex. 2016) (holding TCPA requires an award of reasonable
attorney’s fees to the successful movant).
Sandee Bryan Marion, Chief Justice
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Holt Texas, Ltd. D/B/A Holt Cat and D/B/A Holt Rental Services v. M&M Crushed Stone Products Inc. and Donald Martinez as Guarantor
Combined Opinion