Opinion issued December 17, 2020
In The
Court of Appeals
For The
First District of Texas
————————————
NO. 01-18-00919-CV
———————————
HONG PHUOC NGO AND DUYEN NGOC DANG, Appellants
V.
ASSOCIATION OF WOODWIND LAKES HOMEOWNERS, INC., Appellee
On Appeal from the 190th District Court
Harris County, Texas
Trial Court Case No. 2018-38662
OPINION
The Association of Woodwind Lakes Homeowners, Inc. (HOA) sued two
Woodwind Lakes residents—Hong Phuoc Ngo and Duyen Ngoc Dang (collectively,
the Ngos)—for breach of contract, alleging that they violated the community’s deed
restrictions. The Ngos moved to dismiss the suit pursuant to the Texas Citizens
Participation Act (TCPA).1 The trial court denied their motion. In two issues on
appeal, the Ngos argue that the trial court erred in denying their TCPA motion to
dismiss because they met their initial burden to establish that the legal action against
them is based on, relates to, or is in response to their exercise of the right of free
speech or right of association and the HOA failed to meet its burden to establish by
clear and specific evidence a prima facie case for each element of its breach-of-
contract claim. We affirm the trial court’s order denying the Ngos’ motion to
dismiss.
Background
The Ngos purchased a house in the Woodwind Lakes subdivision, a deed-
restricted community. The deed restrictions are set forth in the subdivision’s
Declaration of Covenants, Conditions and Restrictions for Woodwind Lakes (the
Declaration). All Woodwind Lakes homeowners, including the Ngos, are members
of the HOA and are bound by the terms of the Declaration. The Declaration requires
the HOA to discharge functions “necessary to the general maintenance of the
1
See TEX. CIV. PRAC. & REM. CODE §§ 27.001–27.011. The Texas Legislature
amended certain provisions of the TCPA in 2019. Act of May 17, 2019, 86th Leg.,
R.S., ch. 378, §§ 1–9, § 12, sec. 27.001, 27.003, 27.005–.007, 27.0075, 27.009–.010
(to be codified at TEX. CIV. PRAC. & REM. CODE §§ 27.001, 27.003, 27.005–.007,
27.0075, 27.009–.010). The amendments became effective September 1, 2019. Id.
at § 11. Because 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 and analyses are to the TCPA as it existed prior to September 1, 2019,
unless otherwise noted.
2
Common Properties” in the community; take action through its board to provide for
the “upkeep, development, and aesthetic appearance of the Common Properties and
Common Facilities”; and “enforce The Declaration for the common benefit” of its
members. Among other things, the Declaration also requires homeowners to submit
proposed changes to their homes’ exteriors to the HOA’s Modifications Committee.
The Ngos submitted a proposal for landscaping to the HOA’s Modifications
Committee in February 2017.2 According to the Ngos, proposals are deemed
automatically approved under the terms of the Declaration if the committee does not
respond to the proposal within the fifteen-day period. After fifteen days passed
without a response from the committee, the Ngos began implementing their
landscaping plans.
One month after the Ngos submitted their proposal, the HOA sent a deed-
restriction-violation letter to the Ngos in which they alleged that the Ngos had failed
to comply with the “ARCHITECTURAL REVIEW PROCEDURES AND
GUIDELINES: Application Procedures” by their “non-submission of an
APPROVED ACC application before starting work on [their] back yard.”
The HOA and the Ngos exchanged correspondence about the Ngos’
landscaping project as well as the Ngos’ other proposed exterior modifications. After
2
The Ngos submitted additional proposals and plans on March 1, 2017, May 21,
2018, and May 22, 2018 and assert they received no responses to those proposals
either.
3
the parties were unable to resolve their dispute, the HOA sued the Ngos for breach
of contract and sought injunctive relief ordering the Ngos to cease violating the deed
restrictions and cure the existing violations. The HOA alleged that the Ngos violated
the Declaration by making improvements to the exterior of their home without
obtaining prior written authorization from the HOA and by failing to remove
modifications that violated the deed restrictions.
The Ngos moved to dismiss the suit under the TCPA. The trial court denied
their motion, and they appealed.
The Texas Citizens Participation Act
The Ngos filed their motion to dismiss the HOA’s suit under the TCPA. See
TEX. CIV. PRAC. & REM. CODE § 27.001–.011.
Chapter 27 of the Texas Civil Practice & Remedies Code, also known as the
Texas Citizens Participation Act, “is a bulwark against retaliatory lawsuits meant to
intimidate or silence citizens on matters of public concern.” Dall. Morning News,
Inc. v. Hall, 579 S.W.3d 370, 376 (Tex. 2019). The act is intended “to identify and
summarily dispose of lawsuits designed only to chill First Amendment rights, not to
dismiss meritorious lawsuits.” In re Lipsky, 460 S.W.3d 579, 589 (Tex. 2015).
The purpose of the TCPA, as stated in Civil Practice and Remedies Code
chapter 27, “is to ‘encourage and safeguard the constitutional rights of persons to
petition, speak freely, associate freely, and otherwise participate in government to
4
the maximum extent permitted by law and, at the same time, protect the rights of a
person to file meritorious lawsuits for demonstrable injury.’” ExxonMobil Pipeline
Co. v. Coleman, 512 S.W.3d 895, 898 (Tex. 2017) (quoting TEX. CIV. PRAC. & REM.
CODE § 27.002). The TCPA’s primary vehicle for accomplishing its stated purpose
is a three-step motion-to-dismiss procedure that allows defendants who claim that a
plaintiff has filed a suit in response to the defendant’s exercise of a constitutionally
protected right to seek dismissal of the underlying action, attorney’s fees, and
sanctions at an early stage in the litigation. See TEX. CIV. PRAC. & REM. CODE §§
27.003, .005, .009(a); Creative Oil & Gas, LLC v. Lona Hills Ranch, LLC, 591
S.W.3d 127, 132 (Tex. 2019); Gaskamp v. WSP USA, Inc., 596 S.W.3d 457, 469–
70 (Tex. App.—Houston [1st Dist.] 2020, pet. dism’d) (en banc).
A defendant who invokes the TCPA’s protections by filing a motion to
dismiss must show first by a preponderance of the evidence that the TCPA applies.
See TEX. CIV. PRAC. & REM. CODE § 27.005(b). When this suit was filed, the TCPA
applied if the plaintiff’s “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.; Lipsky, 460 S.W.3d at 586–87.3 A “legal action” is “a
lawsuit, cause of action, petition, complaint, cross-claim, or counterclaim or any
3
Under the amended version of the statute, the TCPA only applies if the legal action
is “based on or is in response to” a movant’s exercise of a protected right.
5
other judicial pleading or filing that requests legal or equitable relief.” TEX. CIV.
PRAC. & REM. CODE § 27.001(6).
If the defendant makes this initial showing, the burden shifts to the plaintiff to
establish “by clear and specific evidence a prima facie case for each essential
element” of his claim. TEX. CIV. PRAC. & REM. CODE § 27.005(c); Lipsky, 460
S.W.3d at 587. If, however, the plaintiff establishes a prima facie case for its claim,
then the burden shifts back to the movant to establish, by a preponderance of the
evidence, each essential element of a valid defense to the claim. TEX. CIV. PRAC. &
REM. CODE § 27.005(d). A plaintiff can avoid the act’s burden-shifting requirements,
however, by showing that one of the TCPA’s exemptions applies, such as the
commercial speech exemption. See id. § 27.010(b).
If the trial court grants the motion to dismiss, it must award costs, reasonable
attorney’s fees, and other expenses of defending against the action “as justice and
equity may require.” Id. § 27.009(a). The trial court also must sanction the plaintiff
in an amount “sufficient to deter the party who brought the legal action from bringing
similar actions.” Id.4
4
This portion of the TCPA was amended, effective September 1, 2019. Under the
amended version of the TCPA, an award of sanctions is optional, not mandatory.
6
A. Standard of Review
We review de novo the denial of a TCPA motion to dismiss. Dolcefino v.
Cypress Creek EMS, 540 S.W.3d 194, 199 (Tex. App.—Houston [1st Dist.] 2017,
no pet.); Better Bus. Bureau of Metro. Hous., Inc. v. John Moore Servs., Inc., 441
S.W.3d 345, 353 (Tex. App.—Houston [1st Dist.] 2013, pet. denied). To the extent
resolution of this appeal turns on construction of the TCPA, we review that de novo
as well. Youngkin v. Hines, 546 S.W.3d 675, 680 (Tex. 2018); Gaskamp, 596 S.W.3d
at 470.
In determining whether to grant or deny a motion to dismiss, the court must
consider the pleadings and supporting and opposing affidavits stating the facts on
which the liability or defense is based. TEX. CIV. PRAC. & REM. CODE § 27.006(a);
Lipsky, 460 S.W.3d at 587. In some cases, the relevant evidence may also include
live testimony and other documentary evidence. See Batra v. Covenant Health Sys.,
562 S.W.3d 696, 707 (Tex. App.—Amarillo 2018, pet. denied); see generally TEX.
CIV. PRAC. & REM. CODE § 27.006(b) (stating trial court “may allow specified and
limited discovery relevant to the motion” to dismiss). We view the pleadings and
evidence in the light most favorable to the nonmovant. Dolcefino, 540 S.W.3d at
199; Porter-Garcia v. Travis Law Firm, P.C., 564 S.W.3d 75, 84 (Tex. App.—
Houston [1st Dist.] 2018, pet. denied).
7
B. Applicability of the TCPA to the HOA’s Breach-of-Contract Claim
The Ngos argue that the TCPA applies to the HOA’s suit because the lawsuit
is based on, related to, or in response to the Ngos’ exercise of their right of free
speech and their right of association.
1. Right of Free Speech
The TCPA defines the “[e]xercise of the right of free speech” as “a
communication made in connection with a matter of public concern.” TEX. CIV.
PRAC. & REM. CODE § 27.001(3). A “communication” includes “the making or
submitting of a statement or document in any form or medium, including oral, visual,
written, audiovisual, or electronic.” Id. § 27.001(1). When this suit was filed, a
“matter of public concern” included “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)5; Coleman, 512 S.W.3d at 899.
5
The current version of the TCPA, which became effective on September 1, 2019,
defines a “matter of public concern” as “a statement or activity regarding: (A) a
public official, public figure, or other person who has drawn substantial public
attention due to the person’s official acts, fame, notoriety, or celebrity; (B) a matter
of political, social, or other interest to the community; or (C) a subject of concern to
the public.” TEX. CIV. PRAC. & REM. § 27.001(7) (current version). Notably,
“environmental, economic, or community well-being” and “a good, product, or
service in the marketplace” are no longer defined as a “matter of public concern.”
8
Although “[t]he TCPA casts a wide net,” Adams v. Starside Custom Builders,
LLC, 547 S.W.3d 890, 894 (Tex. 2018), the statute’s scope is not as far reaching as
once thought. As the Texas Supreme Court recently explained in Creative Oil &
Gas, “not every communication related somehow to one of the broad categories set
out in section 27.001(7) always regards a matter of public concern.” 591 S.W.3d at
137. In that case, the lessor of an oil and gas lease sued the lessee in a trespass and
trespass-to-try-title action, seeking a ruling that the lease was terminated due to
cessation of production. Id. at 130. As relevant here, the lessee and the operator filed
counterclaims alleging that the lessor had breached the lease and had falsely told
third-party purchasers of production from the lease that the lease was expired and
that payments on the purchases should stop. Id. The lessor moved to dismiss the
counterclaims pursuant to the TCPA and argued that its statements to third parties
about the lease were an exercise of its right of free speech because these
communications were made in connection with matters of public concern, namely,
economic well-being.
The supreme court, however, rejected this argument, and held that the lessor’s
communications with third parties were not covered by the TCPA because they were
private business communications regarding a private contract dispute. Id. at 134–37.
As the court explained, the term “economic well-being” had to be interpreted
considering the common meaning of a “matter of public concern,” which does not
9
include “purely private matters.” Id. at 135. Therefore, the court rejected the
argument that the communications at issue concerned a matter of public concern,
namely, economic well-being, because “[a] private contract dispute affecting only
the fortunes of the private parties involved is simply not a ‘matter of public concern’
under any tenable understanding of those words.” Id. at 137.
Relying in part on Creative Oil & Gas, an en banc panel of this Court held in
Gaskamp that communications between former employees that related to the
employees’ alleged conduct of misappropriating, sharing, and using the plaintiff’s
trade secrets and conspiring with one another in furtherance of their tortious actions,
did not constitute an exercise of their free-speech rights because these
communications “had no public relevance beyond the pecuniary interests of the
private parties.” Gaskamp, 596 S.W.3d at 477; see also Creative Oil & Gas, 591
S.W.3d at 137 This court also held that communications made by the plaintiff’s
former employees in soliciting and procuring business from a third party did not
constitute an exercise of the employees’ free-speech rights because these
communications did not have any “relevance to a public audience of buyers or sellers
but instead were limited to ‘the pecuniary interests of the private parties involved.’”
Gaskamp, 596 S.W.3d at 479 (quoting Creative Oil & Gas, 591 S.W.3d at 136). The
supreme court, which acknowledged that it had “previously held that private
communications are sometimes covered by the TCPA” in Coleman and Lippincott,
10
explained that the communications in those cases were covered by the TCPA only
because they “involved environmental, health, or safety concerns that had public
relevance beyond the pecuniary interests of the private parties involved.” Creative
Oil & Gas, 591 S.W.3d at 136 (citing Coleman, 512 S.W.3d at 898, 901; Lippincott
v. Whisenhunt, 462 S.W.3d 507, 509–10 (Tex. 2015); see also Gaskamp, 596 S.W.3d
at 476.
The Ngos argue that the TCPA applies to the HOA’s suit because the
applications they submitted to the HOA’s modifications committee, as well as the
correspondence they exchanged regarding their dispute over the improvements they
made to their home, are communications that relate directly to matters of “safety,”
“economic well-being,” and “community well-being,” as set forth in the Declaration.
TEX. CIV. PRAC. & REM. § 27.001(7).6 Specifically, the HOA alleged that the Ngos
violated the Declaration by making improvements to the exterior of their home
without obtaining prior written authorization from the HOA and by failing to remove
improvements that violate the deed restrictions.
6
The Ngos argue for the first time on appeal that “[t]he HOA itself can also be
considered the ‘government’ for the purposes of the statute,” and therefore the
communications at issue in this case are protected because they were made in
connection with “the government.” TEX. CIV. PRAC. & REM. CODE § 27.001(7). We
do not need to reach this contention, however, because it was waived by the Ngos’
failure to raise it with the trial court. See TEX. R. APP. P. 33.1(a) (explaining that, as
prerequisite to presenting complaint for appellate review, record must show
complaint was made to trial court and trial court ruled or refused to rule); Baumgart
v. Archer, 581 S.W.3d 819, 826 n.4 (Tex. App.—Houston [1st Dist.] 2019, pet.
denied).
11
The applications the Ngos submitted to the HOA’s modifications committee
were contractually required by the Declaration, and the correspondence the Ngos
and the HOA exchanged that are related to those applications are attempts by the
parties to resolve their ongoing disputes regarding the Ngos’ alleged violations of
the Declaration. Private communications regarding a private contract dispute are not
a matter of public concern. See Newpark Mats & Integrated Services, LLC v. Cahoon
Enterprises, LLC, 605 S.W.3d 671, 681–82 (Tex. App.—Houston [1st Dist.] Mar.
26, 2020, no pet.) (citing Creative Oil & Gas, 591 S.W.3d at 134–37); cf. Baywood
Estates Prop. Owners Ass’n, Inc. v. Caolo, 392 S.W.3d 776, 782 (Tex. App.—Tyler
2012, no pet.) (stating that restrictive covenant is contractual agreement); Ski
Masters of Tex., LLC v. Heinemeyer, 269 S.W.3d 662, 668 (Tex. App.—San Antonio
2008, no pet.) (same).
We further note that the only parties who have a tangible interest in any
diminished resale value/property value of the homes in the subdivision caused by
the Ngos’ breaches of the Declaration are the other homeowners in the subdivision,
i.e., other HOA members. The same can be said for any nuisances, annoyances, or
disturbances these alleged violations have caused the owners and occupants of the
homes in the subdivision located near the Ngos’ residence. The pleadings and the
record do not reflect any element of public involvement or public interest in this
dispute between the HOA and the Ngos. Therefore, none of these matters amount to
12
a matter of public concern because, as pleaded, this is private contract dispute
affecting only the interests of the parties involved—the Ngos, the HOA, and the
other HOA members. See Creative Oil & Gas, 591 S.W.3d at 137 (stating that “[a]
private contract dispute affecting only the fortunes of the private parties involved is
simply not a ‘matter of public concern’ under any tenable understanding of those
words”). Notably, the opinions that the Ngos rely upon for the proposition that the
TCPA applies in this case were issued before Creative Oil & Gas and Gaskamp
clarified what can be considered a matter of public concern for purposes of the
TCPA.7 See e.g., Adams, 547 S.W.3d 890; Schimmel v. McGregor, 438 S.W.3d 847
(Tex. App.—Houston [1st Dist.] 2014, pet. denied); Garton v. Shiloh Vill. Partners,
LLC, No. 12-16-00286-CV, 2017 WL 6884451 (Tex. App.—Tyler Aug 23, 2017,
no pet.) (mem. op.).
Based on the record before us, we conclude that the matters raised by the
HOA’s lawsuit that arise from the breach of a private contract, the Declaration, are
private in nature and have no public relevance beyond the pecuniary interests of the
7
We further note that most of the opinions the Ngos rely upon are also not binding
upon this court. See, e.g., Grant v. Pivot Tech. Sols., Ltd., 556 S.W.3d 865 (Tex.
App.—Austin 2018, pet. denied); Elite Auto Body LLC v. Autocraft Bodywerks, Inc.,
520 S.W.3d 191 (Tex. App.—Austin 2017, pet. dism’d); Green v. Port of Call
Homeowners Ass’n, No. 03-18-00264-CV, 2018 WL 4100855 (Tex. App.—Austin
Aug. 29, 2018, no pet.) (mem. op.); Abatecola v. 2 Savages Concrete Pumping,
LLC, No. 14-17-00678-CV, 2018 WL 3118601 (Tex. App.—Houston [14th Dist.]
June 26, 2018, pet. denied) (mem. op.); Neyland v. Thompson, No. 03-13-00643-
CV, 2015 WL 1612155 (Tex. App.—Austin Apr. 7, 2015, no pet.) (mem. op.).
13
Ngos, the HOA, and the other HOA members. See Creative Oil & Gas, 591 S.W.3d
at 136. Therefore, we conclude that the Ngos did not meet their burden of showing,
by a preponderance of the evidence, that the HOA’s suit was based on, relates to, or
is in response to the Ngos’ exercise of their right to free speech. See TEX. CIV. PRAC.
& REM. CODE § 27.005(b)(1).
Having done so, we next decide whether the Ngos met their burden to show
that the HOA’s suit is “based on, relates to, or is in response” to an exercise of the
Ngos’ right of freedom of association.
2. Right of Association
At the time to this suit was filed, the TCPA defined the “[e]xercise of the right
of association” as a “communication between individuals who join together to
collectively express, promote, pursue, or defend common interests.” Id. § 27.001(2).
An en banc panel of this court held in Gaskamp that the right of association
“with respect to the pre-amendment version of the TCPA, the proper definition of
‘common’ in the phrase ‘common interests’ is ‘of or relating to a community at large:
public.’” 596 S.W.3d at 476. Relying upon this interpretation, this court held that the
defendants did not meet their burden of showing by a preponderance of the evidence
that the suit was based on, related to, or was in response to an exercise of their right
of association because the conduct and communications at issue, which involved
misappropriating plaintiff’s trade secrets and conspiring to commit related torts,
14
“benefitted only the five alleged tortfeasors” and there were no “allegations that the
tortfeasors ‘join[ed] together to collectively express, promote, pursue, or defend’ any
public or community interests.” Id.
Relying upon Gaskamp, a panel of this court recently held that
communications made between private parties regarding an investigation into
possible overbilling in violation of a private contract were not protected
communications because there was no indication in the record that the investigation
of the billing practices “involved any manner of public or citizen participation.”
Newpark Mats, 605 S.W.3d at 679–80. We explained that these communications
involved “a private contract dispute between two private parties and the only party
who would benefit from this investigation is [the plaintiff], and possibly the
customers [the plaintiff] had overbilled.” Id. at 680.
The Ngos argue that there are two exercises of associational rights at issue in
this case, namely, their right to “join together” with the other HOA members: (1) “in
furtherance of their common interest to preserve and advance the welfare of the
neighborhood in which they live;” and (2) “to promote, pursue, or defend their
common interests of enjoying the free use of their property.” According to the Ngos,
the written applications they submitted to the HOA’s Modifications Committee and
the related correspondence are protected “communications” between them and other
HOA members. See TEX. CIV. PRAC. & REM. CODE § 27.001(2) (defining “[e]xercise
15
of the right of association” as “communication between individuals who join
together to collectively express, promote, pursue, or defend common interests”).
The Declaration is a private contract between private parties intended to
protect the parties’ financial interests in their respective properties, including the
common properties shared by all the HOA members. There is no indication in the
record that the Ngos and other HOA members’ shared interests in “preserv[ing] and
advanc[ing] the welfare of the neighborhood in which they live” or “enjoying the
free use of their [private] property,” involve any manner of public or citizen
participation. See Newpark Mats, 605 S.W.3d at 680; see also Gaskamp, 596 S.W.3d
at 476. Indeed, the petition is not based on the Ngos joining “together” with the
HOA or other HOA members. On the contrary, the basis of the petition is that the
Ngos have violated the Declaration and are in direct conflict with the HOA.
The opinions that the Ngos rely upon were issued before Gaskamp and
Newpark Mats and/or are factually distinguishable.8 For example, unlike in the
supreme court’s opinion in Adams, there are no allegations of malfeasance or
criminality by any party involved in this case. See Adams, 547 S.W.3d at 893
(business disparagement suit based on blog posts and emails in which homeowner
8
We further note that the other opinions that the Ngos rely upon are not binding upon
this court. See, e.g., Grant, 556 S.W.3d 865; Elite Auto Body LLC, 520 S.W.3d 191;
Green, 2018 WL 4100855; Abatecola, 2018 WL 3118601; Neyland, 2015 WL
1612155.
16
implied that prior owner of neighborhood developer is felon, developer engaged in
illegal or improper business practices, homeowner’s association was being
controlled by alleged felon, and homeowner’s association had been cutting down
trees without city permits and violated city ordinances). Here, the record and the
pleadings reflect that the Ngos’ dispute with the HOA is essentially a contract
dispute. This court’s opinion in Fawcett v. Rogers, 492 S.W.3d 18, 24 (Tex. App.—
Houston [1st Dist.] 2016, no pet.), which was issued prior to the en banc court’s
opinion in Gaskamp, was based on the presumption that a “common interest” does
not require any degree of public involvement—reasoning that Gaskamp implicitly
disavowed. See Gaskamp, 596 S.W.3d at 476 (holding “common interest” means “of
or relating to a community at large: public,” and concluding that movants had not
met their burden to prove that suit “was based on, relates to, or is in response to an
exercise of their right of association” because there were “no allegations that the
tortfeasors ‘join[ed] together to collectively express, promote, pursue, or defend’ any
public or community interests,” as opposed to private interest shared only between
tortfeasors).
Based on the record before us, we conclude that the Ngos did not meet their
burden of showing, by a preponderance of the evidence, that the HOA’s suit was
based on, relates to, or is in response to the Ngos’ exercise of their right of
association as that term is used in the TCPA. See TEX. CIV. PRAC. & REM. CODE
17
§ 27.005(b)(3). The trial court did not err by denying the Ngos’ motion to dismiss
pursuant to the TCPA because the Ngos did not establish that the TCPA applied.
We overrule the Ngos’ first issue.9
Conclusion
We affirm the trial court’s interlocutory order denying the Ngos’ motion to
dismiss.
Russell Lloyd
Justice
Panel consists of Justices Keyes, Lloyd, and Landau.
Landau, J., dissenting.
9
Having determined that the Ngos did not meet their initial burden to establish the
application of the TCPA, we do not need to address the issue presented in the Ngos’
second issue—whether the HOA established by clear and specific evidence a prima
facie case for each element of its breach-of-contract claim.
18