Brandon McDaniel, Jounte McDaniel, Jonathan K. Poulard, Kimberly D. Poulard, and American Gold Reserve, LLC v. Nationwide Coin & Bullion Reserve, Inc.

Affirmed and Memorandum Opinion filed August 11, 2020.

In The

Fourteenth Court of Appeals

NO. 14-18-00734-CV

BRANDON MCDANIEL, JOUNTE MCDANIEL, JONATHAN K.
POULARD, KIMBERLY D. POULARD, AND AMERICAN GOLD
RESERVE, LLC, Appellants
V.
NATIONWIDE COIN & BULLION RESERVE, INC., Appellee

On Appeal from the 270th District Court
Harris County, Texas
Trial Court Cause No. 2018-17064

MEMORANDUM OPINION

Appellants Brandon McDaniel, Jounte McDaniel, Jonathan K. Poulard,
Kimberly D. Poulard, and American Gold Reserve, Inc. (the “AGR Parties”) bring
this interlocutory appeal1 of the trial court’s order denying their motion to dismiss

1
See Tex. Civ. Prac. & Rem. Code § 51.014(a)(12) (authorizing interlocutory appeal of
order denying motion to dismiss filed under TCPA Section 27.003).
under the Texas Citizens Participation Act (“TCPA”).2 See Tex. Civ. Prac. & Rem.
Code § 27.002, et seq. In four issues, the AGR Parties challenge the trial court’s
ruling arguing: (1) the TCPA applies because the challenged claims relate to
communications in furtherance of the AGR Parties’ right of association and right of
free speech and are covered by the TCPA; (2) appellee Nationwide Coin & Bullion
Reserve, Inc.’s (“Nationwide”) commercial speech exemption argument is
foreclosed; (3) Nationwide failed to meet its burden to present “clear and specific”
evidence in support of each element of its claims; and (4) the trial court erred by
denying the motion to dismiss under the TCPA. Because Nationwide’s causes of
action fall within the commercial speech exception to the TCPA, we affirm the trial
court’s order denying the motion to dismiss.

I. BACKGROUND

Nationwide markets and sells precious metals including gold, silver, and
platinum coins, and has been in business since 2009. Nationwide is owned or
controlled by Lawrence Kuykendall. Nationwide hired Kuykendall’s stepsons
appellants Brandon McDaniel (“McDaniel”) and Jounte McDaniel (“Jounte”).
McDaniel, who began work for Nationwide in 2010, was responsible for promoting
and supporting sales to Nationwide’s customers.

In March 2016, Jounte, left Nationwide and formed a competitor business,
appellant American Gold Reserve, LLC (“AGR”). AGR markets and sells precious
metals to a retail market, including gold and silver coins, just as Nationwide does.

2
The Texas Legislature amended certain provisions of the TCPA in 2019. See Act of May
17, 2019, 86th Leg., R.S., ch. 378, §§ 1–12, 2019 Tex. Gen. Laws 684, 687 (current version at
Tex. Civ. Prac. & Rem. Code §§ 27.001–.011). The amendments became effective September 1,
2019. Id. at §§ 11–12. Because this suit was filed before the effective date of the amendments,
this case is governed by the statute as it existed before the amendments. See id. All our citations
are to the TCPA as it existed prior to September 1, 2019, unless otherwise stated.

2
Appellant Kimberly D. Poulard is the listed on AGR corporate documents filed with
the State of Texas as the Secretary and a Manager of AGR. Appellant Jonathan K.
Poulard is the Treasurer of AGR. Kimberly and Jonathan are the aunt and uncle of
McDaniel and Jounte.

McDaniel remained at Nationwide, and on March 23, 2016, he signed an
Employment Agreement (the “Agreement”) with Nationwide. In the Agreement,
McDaniel specifically recognized and acknowledged that the position was one of
trust and confidence and that, as a result, he had access to, and was given specialized
education and confidential, proprietary information of Nationwide. In exchange, as
part of the consideration for the compensation and benefits to be paid to McDaniel,
and to protect Nationwide’s interest in its confidential information and business
relationships, McDaniel agreed to be bound by certain non-compete and non-
interference terms in the Agreement. The Agreement provisions provide, in material
part, that for a one-year period after the Agreement terminated, McDaniel would not
work for any of Nationwide’s competitors, and would not solicit any of
Nationwide’s customers within any geographic area or market where Nationwide
was conducting business or had conducted business during the preceding two years.

In December 2017, Kuykendall allegedly cut McDaniel’s pay at Nationwide
in half. On December 18, 2017, McDaniel resigned from Nationwide and began
working for AGR. On that same date, AGR’s certificate of formation was amended
to include McDaniel as a Managing Member of the company.

After McDaniel’s departure from Nationwide, Nationwide allegedly began
receiving calls from customers about calls the customers had received from AGR.
The customers claimed that AGR was aware of their purchase history with
Nationwide and that AGR claimed Nationwide had overcharged them in
transactions. These calls resulted in several customers initiating refund claims with

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Nationwide. It is believed that AGR then resold the same or similar coins to
Nationwide’s customers.

In March 2018, Nationwide sued McDaniel for breach of the employment
agreement and breach of fiduciary duties. Additionally, Nationwide sued all
defendants (McDaniel, Jounte, Jonathan, Kimberly, and AGR) for trade secret
misappropriation, tortious interference with prospective business relations, unfair
competition by misappropriation, injunctive relief, and liquidated damages. The
trial court granted Nationwide’s application for a temporary restraining order against
McDaniel and set the date for a temporary injunction hearing. The AGR Parties
filed an answer that generally denied the allegations against them and responded to
the application for temporary injunction. They also moved to dismiss Nationwide’s
suit under the TCPA.

Nationwide filed a lengthy response and asserted three reasons to deny the
motion to dismiss. First, Nationwide argued that its legal action falls within the
ambit of the TCPA’s commercial speech exemption. Second, the AGR Parties
cannot show by a preponderance of the evidence that their claims relate to their
exercise of free speech or association. And third, Nationwide argued that the
pleadings and evidence established a prima facie case for every essential element
for each of Nationwide’s causes of action. The AGR Parties filed a reply.

On August 13, 2018, without stating the basis for the ruling, the trial court
issued an order denying the AGR Parties’ motion to dismiss. The AGR Parties now
challenge that ruling in this interlocutory appeal.

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 II. ANALYSIS

A. Standard of Review and Governing Law

We consider whether the trial court properly refused to dismiss Nationwide’s
suit under the TCPA, which is codified in Chapter 27 of the Civil Practice and
Remedies Code. See Tex. Civ. Prac. & Rem. Code §§ 27.001--.011.1. The TCPA
is an anti-SLAPP law; “SLAPP” is an acronym for “Strategic Lawsuits Against
Public Participation.” Fawcett v. Grosu, 498 S.W.3d 650, 654 (Tex. App.—Houston
[14th Dist.] 2016, pet. denied) (op. on reh’g). The TCPA is intended “to encourage
and safeguard the constitutional rights of persons to petition, speak freely, associate
freely, and otherwise participate in government to the maximum extent permitted by
law and, at the same time, protect the rights of a person to file meritorious lawsuits
for demonstrable injury.” Tex. Civ. Prac. & Rem. Code § 27.002; Cox Media Grp.,
LLC v. Joselevitz, 524 S.W.3d 850, 859 (Tex. App.—Houston [14th Dist.] 2017, no
pet.). The TCPA “protects citizens from retaliatory lawsuits that seek to intimidate
or silence them” from exercising their First Amendment freedoms and provides a
procedure for the “expedited dismissal of such suits.” In re Lipsky, 460 S.W.3d 579,
586 (Tex. 2015). We construe the TCPA liberally to effectuate its purpose and intent
fully. See Adams v. Starside Custom Builders, LLC, 547 S.W.3d 890, 894 (Tex.
2018); ExxonMobil Pipeline Co. v. Coleman, 512 S.W.3d 895, 899 (Tex. 2017); Tex.
Civ. Prac. & Rem. Code § 27.011(a).

To effectuate the statute’s purpose, the TCPA provides a three-step decisional
process to determine whether a lawsuit or claim should be dismissed under the
statute. Creative Oil & Gas, LLC v. Lona Hills Ranch, LLC, 591 S.W.3d 127, 132
(Tex. 2019). The TCPA mandates that a trial court deciding a motion to dismiss
“shall consider the pleadings and supporting and opposing affidavits” filed by the
parties. Tex. Civ. Prac. & Rem. Code § 27.006(a). Under the first step, the trial court

5
must dismiss the action “if the moving party shows by a preponderance of the
evidence that the legal action is based on, relates to, or is in response to the movant’s
exercise of (1) the right of free speech; (2) the right to petition; or (3) the right of
association. Id. § 27.005(b); Creative Oil & Gas, LLC, 591 S.W.3d at 132; In re
Lipsky, 460 S.W.3d at 586–87. “But under the second step, the court may not
dismiss the action if the non-moving party ‘establishes by clear and specific evidence
a prima facie case for each essential element of the claim.’”3 Creative Oil & Gas,
LLC, 591 S.W.3d at 132 (quoting Tex. Civ. Prac. & Rem. Code § 27.005(c)). “Under
the third step, the movant can still win dismissal if he establishes ‘by a
preponderance of the evidence each essential element of a valid defense to the
nonmovant’s claim.’” Id. (quoting § 27.005(d)).

A non-movant can avoid the TCPA’s burden-shifting requirements by
showing that one of the act’s several statutory exemptions applies. See Tex. Civ.
Prac. & Rem. Code § 27.010. For instance, as asserted in this case, the commercial
speech exemption removes certain commercial speech from the TCPA’s protections.
See id. § 27.010(b). Whether the parties have met these respective burdens is a
question of law that we review de novo. Creative Oil & Gas, LLC, 591 S.W.3d at
132; Dallas Morning News, Inc. v. Hall, 579 S.W.3d 370, 377 (Tex. 2019).

In the trial court, the AGR Parties were the TCPA movants, where they argued
that Nationwide’s legal action was a retaliatory suit based on their exercise of the
right of association and freedom of speech. For the sake of argument, we assume
without deciding that the AGR Parties were correct and that they satisfied their initial

3
“Prima facie case” refers to the quantum of evidence required to satisfy the nonmovant’s
minimum factual burden and generally refers to the amount of evidence that is sufficient as a
matter of law to support a rational inference that an allegation of fact is true. See id. at 590; Deaver
v. Desai, 483 S.W.3d 668, 675-76 (Tex. App.—Houston [14th Dist.] 2015, no pet.).

6
burden. The question then becomes whether Nationwide satisfied its burden as the
nonmovant.

B. Commercial Speech Exemption of the TCPA

Attacking the TCPA motion on multiple fronts, Nationwide argued that it
established a prima facie case for its legal action, and that its legal action was exempt
under the TCPA’s commercial speech exemption. We need only address the
commercial speech exemption because it is dispositive. See Hieber v. Percheron
Holdings, LLC, 591 S.W.3d 208, 213 (Tex. App.—Houston [14th Dist.] 2019, pet.
denied).

First, the AGR Parties argue that Nationwide waived its commercial speech
exemption because, in the trial court, Nationwide relied on a case which did not
apply the “intended audience” element, which has since been made part of the
commercial speech exemption requirements by the Supreme Court of Texas. See
Castleman v. Internet Money Ltd., 546 S.W.3d 684, 688 (Tex. 2018) (per curiam).
In the trial court, Nationwide quoted the exemption as codified in section 27.010(b),
and argued it applied to this case. Nationwide also cited Castleman in arguing that
the exemption applies. Thus, there was no waiver of its application. To the extent
the AGR parties argue that Nationwide did not prove the intended audience element,
as shown below, they are mistaken.

Next, the AGR Parties contend that that the commercial speech exemption
only applies to Nationwide’s claims for tortious interference, not their other causes
of action. As support, they cite this court’s opinion in Abatecola v. 2 Savages
Concrete Pumping, LLC, No. 14-17-00678-CV, 2018 WL 3118601 (Tex. App.—
Houston [14th Dist.] Jun. 26, 2018, pet. denied) (mem. op.), in which this court
found the commercial speech exemption applied to a tortious interference cause of
action based on alleged intentional interference with customers but did not apply to
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a tortious interference claim based on hiring. Id. at *9. Contrary to the AGR Parties’
argument, this court did not determine that the commercial speech exemption only
applies to tortious interference claims. Under the facts of the Abatecola case, the
commercial speech exemption did not apply to a third-party tortious interference
claim based on normal hiring practices as opposed to a claim based on alleged
knowing interference with customers. Id. Indeed, this court recently determined
that the commercial speech exemption applied to a breach-of-contract claim
premised on a former employee’s breach of a non-compete clause. See Hieber, 591
S.W.3d at 213.

The AGR Parties also argue that Castleman rejects Nationwide’s
interpretation of the commercial speech exemption (i.e., that Nationwide’s claims
for trade secrets and non-compete fall within the commercial speech exemption).
See 546 S.W.3d at 688. The AGR Parties contend that Nationwide failed to address
the critical elements of the exemption. They further assert that the commercial
speech exemption is “categorically inapplicable to the trade secret and non-compete
claims, as well as the claims involving communications with vendors.” The facts in
Castleman are distinguishable from the facts in this case. In Castleman, the
defendant made disparaging statements about the plaintiff related to plaintiff’s
customer service. Castleman, 546 S.W.3d at 691. The supreme court held that the
defendant did not have anything to gain from negative comments about plaintiff
because the defendant was a customer of the plaintiff and not a seller of goods or
services. See id. Based on this holding, the TCPA was applicable and the
commercial speech exemption did not apply. See id. Here, however, the AGR
Parties are not customers of Nationwide. Rather, the AGR Parties are competitors
selling the same goods and services. Therefore, AGR Parties’ reliance on Castleman
is misplaced.

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 The commercial speech exemption provides that the TCPA “does not apply
to a legal action brought against a person primarily engaged in the business of selling
or leasing goods or services, if the statement or conduct arises out of the sale or lease
of goods, services, or an insurance product, insurance services, or a commercial
transaction in which the intended audience is an actual or potential buyer or
customer.” Tex. Civ. Prac. & Rem. Code § 27.010(b).

To establish this exemption, the nonmovant must prove: (1) the movant was
primarily engaged in the business of selling or leasing goods, services, or an
insurance product or services; (2) the movant made the statement or engaged in the
conduct on which the claim is based in the movant's capacity as a seller or lessor of
those goods, services, or insurance product or services; (3) the statement or conduct
at issue arose out of a commercial transaction involving the kind of goods, services,
or insurance product the movant provides; and (4) the intended audience of the
statement or conduct was an actual or potential customer of the movant for the kind
of goods, services, or insurance product the movant provides. See Castleman, 546
S.W.3d at 688. The nonmovant must prove these elements by a preponderance of
the evidence. See Abatecola, 2018 WL 3118601, at *10. In deciding whether the
nonmovant has satisfied that burden, the scope of our review includes the pleadings
and any supporting affidavits, both of which are taken as evidence in the TCPA
context. See Tex. Civ. Prac. & Rem. Code § 27.006; Hersh v. Tatum, 526 S.W.3d
462, 467 (Tex. 2017). We also review this evidence in the light most favorable to
the nonmovant. See Brugger v. Swinford, No. 14-16-00069-CV, 2016 WL 4444036,
at *2 (Tex. App.—Houston [14th Dist.] Aug. 23, 2016, no pet.) (mem. op.).

1. Engaged in the business of selling or leasing goods
Beginning with the first element—whether the AGR Parties were primarily
engaged in the business of selling goods, services, or insurance products or

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services—it is uncontested that this case is a dispute between two companies that
market and sell precious metals, including gold, silver, and platinum coins.
Nationwide produced evidence about McDaniel’s professional responsibilities at his
former job and his actions at his current job. Nationwide and AGR are companies
engaged in the business of selling goods or services. In its pleadings, Nationwide
pled that McDaniel “served as the sales manager and was responsible for promoting
and supporting sales to Nationwide’s customers.” The day McDaniel resigned from
Nationwide, AGR amended its corporate documents to add McDaniel as a Manager
of the company. Nationwide further pleaded:

Almost immediately following Defendant Brandon’s [McDaniel’s]
departure from Nationwide, Nationwide began receiving calls from
customers about calls the customers received from American. The
customers claimed that American was aware of their purchase history
with Nationwide and that American claimed Nationwide has
overcharged them in prior transactions. These calls resulted in several
customers initiating refund claims with Nationwide. It is believed that
American then resold the same or similar coins to Nationwide.
In addition to its pleadings, Nationwide relied on an affidavit from Daniel
Fogo, the Compliance Director of Nationwide, who attested that “[t]he individual
[appellants] in this lawsuit are using the Employer Confidential Information
obtained by [appellant] McDaniel to contact and encourage former and prospective
customers of Nationwide, as well as Nationwide’s supplie[r]s, to conduct business
with [AGR] instead of Nationwide.” Specifically, Fogo, attested that after McDaniel
left Nationwide, the AGR Parties solicited a client of Nationwide’s (i.e., Elaine
Phelps) and succeeded in selling her approximately $100,000.00 in gold and silver
coins. The affidavit of Anthony Guilbeau confirms this transaction. When
combined with the pleadings, this evidence is more than sufficient to establish that
the AGR Parties were primarily engaged in the business of selling goods when they
contacted Nationwide customers.

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 2. Made the statement or engaged in the conduct on which the claim
is based in the movant's capacity as a seller or lessor of those goods
For the second element, Nationwide was required to show that its claim was
based on either statements that the AGR Parties made in their capacity as marketing
and selling precious metals including gold, silver, and platinum coins. The pleadings
and attached affidavits establish both bases. Nationwide’s pleadings allege that
McDaniel was given access to Nationwide trade secret and employer confidential
information. Fogo’s affidavit attests that McDaniel disclosed Nationwide’s trade
secret and employer confidential information to AGR for use in AGR’s competing
business. Fogo further attests that “[t]he individual Defendants in this lawsuit are
using the Employer Confidential Information obtained by Brandon McDaniel to
contact and encourage former and prospective customers of Nationwide, as well as
Nationwide’s supplies, to conduct business with American Gold instead of
Nationwide.” As set forth above, after McDaniel left Nationwide’s employment,
AGR successfully solicited Phelps, a Nationwide customer, to purchase gold and
silver coins.

3. Statement or conduct at issue arose out of a commercial transaction
involving the kind of goods or services the movant provides
For the third element, Nationwide was required to show that the statement or
conduct at issue arose out of a commercial transaction involving the kind of services
that the AGR Parties provide. Nationwide pleaded that after McDaniel left
Nationwide with confidential information, the AGR parties began contacting
Nationwide customers informing them they had been overcharged. Fogo’s affidavit
attests, “When Brandon [McDaniel] left the employ of Nationwide in December
2017, Nationwide began to receive telephone calls from some of its customers
complaining they were being contacted on behalf of American Gold [AGR].” He
further attested, “Other customers called Nationwide to return gold and/or silver

11
coins they had purchased, requesting refunds so they could purchase the same coins
from American Gold [AGR] at a better price.” Each of Nationwide’s causes of
action arose out of a commercial transaction involving goods and services that both
the AGR Parties and Nationwide provide (i.e., marketing and selling precious
metals, including gold, silver, and platinum coins to a retail market). See Callison
v. C & C Personnel, LLC, No. 09-19-00014-CV, 2019 WL 3022548, at *6 (Tex.
App.—Beaumont July 11, 2019, pet. denied) (mem. op.) (“Utilizing confidential or
proprietary information from a previous employer while working for a new
employer to target and secure the same customers satisfies this element”).

4. Intended audience of the statement or conduct was an actual or
potential customer of the movant for the kind of goods or services
the movant provides
To support the fourth element, Nationwide was required to show that the
intended audience of the AGR Parties’ conduct was an actual or potential customer
for the kind of goods or services that the AGR Parties provide. Again, Nationwide
established through its pleadings and evidence that, after McDaniel joined AGR, the
AGR Parties targeted Nationwide’s existing customers as their potential customers.
It is undisputed that both AGR and Nationwide operate substantially similar
businesses.

Nationwide’s causes of action are based on the conduct of the AGR Parties’
targeting potential and existing Nationwide customers in violation of the
non-compete clause in McDaniel’s contract. By pleading a breach of the non-
compete provision and McDaniel’s breach of fiduciary duties that accompany that
provision, Nationwide established that the intended audience of the AGR Parties’
conduct was actual or potential customers for the kind of goods or services
Nationwide provides. Fogo’s supplemental affidavit and Nationwide’s pleadings
establish that the intended audience of the AGR Parties’ statements and conduct

12
were potential customers for their goods; therefore, Nationwide has shown that the
AGR Parties’ complained of conduct falls within the commercial speech exemption
to the TCPA.

Viewing the evidence in the light most favorable to Nationwide, we conclude
the evidence establishes by a preponderance of the evidence that Nationwide’s legal
action is exempt under the TCPA’s commercial speech exemption. Because this
conclusion fully supports the trial court’s ruling, we need not consider the parties’
remaining arguments. See Tex. R. App. P. 47.1.

III. CONCLUSION

We affirm the trial court’s denial of the AGR Parties’ TCPA motion to
dismiss.

/s/ Margaret “Meg” Poissant
Justice

Panel consists of Christopher, Spain, and Poissant.

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