ACCEPTED 03-15-00064-CV 4445641 THIRD COURT OF APPEALS AUSTIN, TEXAS 3/10/2015 4:45:02 PM JEFFREY D. KYLE CLERK CAUSE NO. 03-15-00064-CV FILED IN 3rd COURT OF APPEALS In the Court of Appeals AUSTIN, TEXAS For the Third Court of Appeals District 3/10/2015 4:45:02 PM Austin, Texas JEFFREY D. KYLE Clerk ELITE AUTO BODY LLC, d/b/a PRECISION AUTO BODY, REY R. HERNANDEZ, YESICA DIAZ, AND DAVID DAMIAN, Appellants, v. AUTOCRAFT BODYWERKS, INC., now known as WASSON ROAD VENTURES, INC., d/b/a AUTOCRAFT BODYWERKS, Appellee. Expedited Appeal from the 353rd Judicial District Court, Travis County, Texas, the Hon. Tim Sulak, Presiding APPELLANTS’ BRIEF Rick Harrison Texas Bar No. 09120000 rharrison@fbhh.com FRITZ, BYRNE, HEAD & HARRISON, PLLC 98 San Jacinto Boulevard, Suite 2000 Austin, Texas 78701 Telephone: (512) 476-2020 Telecopier: (512) 477-5267 COUNSEL FOR APPELLANTS ORAL ARGUMENT REQUESTED IDENTITY OF PARTIES AND COUNSEL Pursuant to Rule 38.1(a) of the Texas Rules of Appellate Procedure, Appellant lists the following parties affected by this appeal, and their respective counsel: APPELLANTS APPELLEE Elite Auto Body, LLC d/b/a Precision Autocraft Bodywerks, Inc., now known Auto Body, Rey R. Hernandez, Yesica as Wasson Road Ventures, Inc., d/b/a Diaz, and David Damian Autocraft Bodywerks Trial and Appellate Counsel: Trial and Appellate Counsel: Rick Harrison James Ruiz Texas Bar No. 09120000 Texas Bar No. 17385860 rharrison@fbhh.com jruiz@winstead.com S. King Jacylyn G. Austein Texas Bar No. 24067708 Texas Bar No. 24069760 aking@fbhh.com Jaustein@winstead.com Dale L. Roberts W INSTEAD, P.C. Texas Bar No. 24001123 401 Congress Avenue, Suite 2100 droberts@fbhh.com Austin, Texas 78701 FRITZ, BYRNE, HEAD & HARRISON, Telephone: (512) 370-2818 PLLC Facsimile: (512) 370-2850 98 San Jacinto Blvd., Suite 2000 Austin, Texas 78701 Telephone: (512) 476-2020 Facsimile: (512) 477-5267 i TABLE OF CONTENTS IDENTITY OF PARTIES AND COUNSEL ......................................................... i TABLE OF CONTENTS ....................................................................................... ii I. STATEMENT OF THE CASE .........................................................................1 II. STATEMENT REGARDING ORAL ARGUMENT .................................2 III. ISSUES PRESENTED ...................................................................................2 IV. STATEMENT OF FACTS ............................................................................2 V. SUMMARY OF THE ARGUMENT ............................................................5 VI. ARGUMENT ..................................................................................................7 A. The TCPA Applies to Autocraft’s Claims Against the Precision Parties ..............................................................................................................7 1. The scope of the TCPA and the rights it protects are broad ..................7 2. Autocraft’s claims are in response to, or relate to, the Precision Parties’ exercise of their freedoms of association and free speech .......10 B. Because Autocraft wholly failed to meet its evidentiary burden, the trial court was required to dismiss Autocraft’s claims. ............................12 1. Conclusory statements in affidavits do not constitute “clear and specific evidence.” ......................................................................................12 2. Autocraft failed to submit prima facie case for each essential element of its claims .................................................................................14 C. The Precision Parties are entitled to an award of their reasonable attorneys’ fees and expenses ........................................................................16 D. The trial court erred by refusing to hear live testimony at the hearing on Motion to Dismiss ......................................................................17 CONCLUSION AND PRAYER ...........................................................................18 CERTIFICATE OF SERVICE ............................................................................20 CERTIFICATE OF COMPLIANCE ..................................................................21 ii TABLE OF AUTHORITIES CASES Beck v. Law Offices of Edwin J. (“Ted”) Terry, Jr., P.C., 284 S.W.3d 416 (Tex. App.—Austin 2009, no pet.) .......................................................................14 Campbell v. Campbell, Cause No. 03-07-00672-CV, 2010 WL 2477782 (Tex. App.—Austin June 18, 2010, no pet.) .........................................................13 Combined Law Enforcement Assocs. of Texas v. Sheffield, Cause No. 03-13- 00105-CV, 2014 WL 411672 (Tex. App.—Austin, January 31, 2014, pet. filed) ............................................................................................................. 8, 9, 10 Rehak Creative Svcs., Inc. v. Witt, 404 S.W.3d 716 (Tex. App. – Houston [14th Dist.] 2013, pet. denied) .............................................................. 8, 12, 13, 14 Schimmel v. McGregor, 438 S.W.3d 847 (Tex. App.—Houston [1st Dist.] 2014, pet. filed) .....................................................................................................13 Sprayberry v. Siesta MHC Income Partners, L.P., Cause No. 03-08-00649- CV, 2010 WL 1404598 (Tex. App.—Austin April 8, 2010, no pet.) ...................13 STATUTES TEX. CIV. PRAC. & REM. CODE § 27.001 ................................................................1, 6 TEX. CIV. PRAC. & REM. CODE § 27.001(2) ...............................................................9 TEX. CIV. PRAC. & REM. CODE § 27.001(3) ...............................................................9 TEX. CIV. PRAC. & REM. CODE § 27.001(7)(e) ...........................................................9 TEX. CIV. PRAC. & REM. CODE § 27.002 ................................................................5, 8 TEX. CIV. PRAC. & REM CODE § 27.003(a) ................................................................8 TEX. CIV. PRAC. & REM. CODE § 27.005(b) ...............................................................6 iii TEX. CIV. PRAC. & REM. CODE § 27.005(c)..................................................... 6, 8, 12 TEX. CIV. PRAC. & REM. CODE § 27.006 ..................................................................18 TEX. CIV. PRAC. & REM. CODE § 27.009 ..................................................................16 TEX. CIV. PRAC. & REM. CODE § 27.011(b) ...............................................................9 TEX. CIV. PRAC. & REM. CODE § 51.014(a)(12) .........................................................1 TEX. CIV. PRAC & REM. CODE § 134A.002 ....................................................... 14, 16 TEX. CIV. PRAC. & REM. CODE § 134A.004 .............................................................14 iv I. STATEMENT OF THE CASE In response to Appellants’ desire to pursue their common interest in operating a competing business, Appellee filed suit against Appellants seeking injunctive relief and damages. [CR 3-11] In particular, Appellee claims that Appellants have misappropriated alleged trade secrets as Appellants engage in a competitive business in the marketplace. These claims are a veiled attempt to thwart Appellants’ exercise of association, both with regard to the internal management of their business as well as with recruiting qualified labor to their company. Appellants filed a Motion to Dismiss Pursuant to Chapter 27 of the Texas Civil Practice and Remedies Code (the “Motion to Dismiss”), because Appellee’s claims are in response to, or are at least related to, Appellants’ exercise of their freedom of association and speech as defined in the Texas Citizens Participation Act (“TCPA”). See TEX. CIV. PRAC. & REM. CODE § 27.001, et seq. [CR 18-31] The trial court conducted a hearing on the Motion to Dismiss on January 22, 2015, and entered an order denying the Motion to Dismiss on January 23, 2015. [CR 49] Appellants filed this expedited appeal pursuant to TEX. CIV. PRAC. & REM. CODE § 51.014(a)(12) on January 28, 2015. [CR 50-51] APPELLANTS’ BRIEF PAGE 1 II. STATEMENT REGARDING ORAL ARGUMENT This appeal arises from a relatively new statute that has been a matter of significant debate among the appellate courts as to its scope and application. The trial court’s decision regarding the scope of the statute’s coverage conflicts with decisions made by this Court. Accordingly, Appellants believe that oral argument would likely be helpful in this matter and therefore respectfully requests that oral argument be granted. III. ISSUES PRESENTED 1. Did the trial court commit reversible error when it denied the Motion to Dismiss on the grounds that the TCPA did not apply to Appellee’s claims despite evidence showing that such claims were in response to, or related to, Appellants’ exercise of their rights of free association? 2. In the absence of clear and specific evidence establishing a prima facie case for each element of Appellee’s claims, was it error for the trial court to deny the Motion to Dismiss and refuse to award the Precision Parties’ their attorneys’ fees and expenses? 3. Was the trial court correct to refuse live testimony at the hearing for the Motion to Dismiss where the statute does not preclude such evidence? IV. STATEMENT OF FACTS Appellee, Autocraft Bodywerks (“Autocraft”), is an automobile body repair business in Austin. [CR 4] Until recently, John Borek was Autocraft’s owner and general manager. Borek Affidavit, ¶ 1 [CR 41] By multiple accounts, Borek was APPELLANTS’ BRIEF PAGE 2 a harsh manager whose abusive behavior eventually led to key employees leaving the company to form a competing business. Hernandez Declaration, ¶ 4 [CR 26]; Damian Declaration, ¶¶ 3, 5 [CR 29-30] Two Appellants, Rey R. Hernandez (“Hernandez”) and David Damian (“Damian”), are former Autocraft employees. Hernandez Declaration, ¶ 4 [CR 26]; Damian Declaration, ¶¶ 3-5 [CR 29-30] Before working for Autocraft, Hernandez gained extensive expertise performing various types of auto bodywork for over nineteen years including several years at a BMW assembly plant in California. Hernandez Declaration, ¶ 2 [CR 25] After coming to Austin in 2008, Hernandez worked for Autocraft for approximately one year. Hernandez Declaration, ¶ 4 [CR 26] Ultimately, Hernandez resigned from Autocraft due to the hostile work environment created by Borek. Hernandez Declaration, ¶ 6 [CR 26] During his time at Autocraft, Hernandez was never asked to sign a non-competition, non-solicitation or non- disclosure agreement. Hernandez Declaration, ¶ 5 [CR 26] After leaving Autocraft, Hernandez began operating Precision Automotive (“Precision”) in 2009. Over the years, Precision developed into a successful auto body repair business under Hernandez’s leadership. Hernandez Declaration, ¶¶ 6- 7 [CR 26-27] Through his experience in the auto body repair business, Hernandez became aware of the general business practices employed by such repair shops APPELLANTS’ BRIEF PAGE 3 including the use of forms, checklists and Technical Service Bulletins. Hernandez Declaration, ¶¶ 3,5 [CR 25, 27] Damian likewise has many years of experience in the auto body repair industry including several years working for Autocraft as its Production Manager. Before working for Autocraft, Damian worked for many years in his father’s auto body repair shop. Damian Declaration, ¶¶ 2-3 [CR 29] During that time, Damian became aware of the common business practice of using forms and checklists such as those used by Autocraft on which Autocraft’s alleged trade secret and confidential information claims are based. Damian Declaration, ¶¶ 2,4,6 [CR 29- 30] In March, 2014 after several years at Autocraft, David Damian left Autocraft’s employment and joined Precision. Damian Declaration, ¶¶ 3-5 [CR 29-30] During his time at Autocraft, Damian was never asked to sign a non-competition, non-solicitation or non-disclosure agreement. Damian Declaration, ¶ 4 [CR 30] Likewise, he was not told that any of the business practices employed by Autocraft (which were not unique or secret in the industry) were confidential or trade secrets. Not long after Damian joined Precision, Joyce Garcia, Autocraft’s office manager, followed. The employees at Precision enjoy a healthy and productive working environment in contrast to the stressful and often hostile environment created by Autocraft’s former manager, Borek. Damian Declaration, ¶¶ 3-5 [CR APPELLANTS’ BRIEF PAGE 4 29-30] Hereafter, the Appellants Elite Auto Body, LLC d/b/a Precision Auto, Rey R. Hernandez, Yesica Diaz, and David Damian are referred to collectively as the “Precision Parties.” Autocraft’s claims have impacted their communications among the Precision Parties regarding common business practices that Autocraft now claims constitute proprietary information as well as communications with potential customers and potential employees that are currently employed by Autocraft. Hernandez Declaration, ¶¶ 8-9 [CR 27]; Damian Declaration, ¶ 6 [CR 30] V. SUMMARY OF THE ARGUMENT The TCPA must be broadly construed to protect parties’ rights of association and free speech. TEX. CIV. PRAC. & REM. CODE § 27.002. The trial court in this case failed to follow that admonition. The trial court narrowly construed the TCPA and incorrectly concluded that the statute did not apply to Autocraft’s claims. Because the TCPA actually applies to Autocraft’s claims, the trial court incorrectly failed to dismiss the action in the absence of clear and specific evidence of a prima facie case for each element of Autocraft’s claims. This action was clearly instituted in response to the Precision Parties’ exercise of their rights to freedom of association and free speech under the TCPA. Specifically, Autocraft’s claims target the Precision Parties’ communications in APPELLANTS’ BRIEF PAGE 5 pursuit of their common interest of operating a competitive automobile body repair business. See TEX. CIV. PRAC. & REM. CODE § 27.001(2-3) (defining the rights of association and free speech under the TCPA). Although cast as trade secret misappropriation, Autocraft’s claims are a thinly veiled attempt to interfere with the Precision Parties’ lawful business competition by preventing them from communicating non-proprietary business practices and communicating with Autocraft’s employees. Notably, there is zero evidence of business information that arguably constitutes trade secret or confidential information. The Precision Parties clearly met their burden and established that Autocraft’s claims “relate to, or [are] in response to” the Precision Parties’ exercise of their rights of association and free speech. TEX. CIV. PRAC. & REM. CODE § 27.005(b). Because the TCPA applies to Autocraft’s claims, Autocraft bore the burden of “establish[ing] by clear and specific evidence a prima facie case for each essential element” of its claims. TEX. CIV. PRAC. & REM. CODE § 27.005(c). Autocraft wholly failed to meet that burden. Instead of providing clear and specific evidence, Autocraft submitted a conclusory affidavit that primarily recited allegations from its pleadings. In the absence of clear and specific evidence of each element of Autocraft’s claims, the trial court was required to dismiss this APPELLANTS’ BRIEF PAGE 6 action and award the Precision Parties their reasonable attorneys’ fees and expenses. VI. ARGUMENT A. The TCPA Applies to Autocraft’s Claims Against the Precision Parties Autocraft’s claims are in response to, or at least relate to, the Precision Parties’ exercise of their rights of association and free speech. Those rights, as defined by the TCPA, have broad reach and include the Precision Parties’ communications in pursuit of their common interest – the Precision Parties’ competing business – and regarding the Precision Parties provision of services in the marketplace. Because Autocraft’s claims relate to those communications, the TCPA applies. 1. The scope of the TCPA and the rights it protects are broad. Before the enactment of Chapter 27 of the TEXAS CIVIL PRACTICE AND REMEDIES CODE, there was no means to avoid the significant expense required to defend baseless claims intended to stifle people’s rights to freely associate and communicate. As enacted, the statute’s purpose is 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 APPELLANTS’ BRIEF PAGE 7 demonstrable injury.” TEX. CIV. PRAC. & REM. CODE § 27.002. The statute accomplishes that purpose by requiring Autocraft to produce clear and specific evidence of a prima facie case for each essential element of Autocraft’s claims covered by the statute. Id. § 27.005(c). Chapter 27 applies to a broad swath of actions to protect people’s rights of association and free speech. The statute applies to any legal action that “is based on, relates to, or is in response to a party’s exercise of the right of free speech . . . or right of association.” Id. § 27.003(a) (emphasis added). Thus, the statute applies to any claim that merely relates to a party’s exercise of their freedoms of association and free speech. See Rehak Creative Svcs., Inc. v. Witt, 404 S.W.3d 716, 733 (Tex. App. – Houston [14th Dist.] 2013, pet. denied) (holding that conversion and misappropriation claims were covered by the TCPA where they had “a connection to” protected communications). The rights covered by the TCPA are broader than the protections provided by the Constitution for those same rights. See Combined Law Enforcement Assocs. of Texas v. Sheffield, Cause No. 03-13-00105-CV, 2014 WL 411672, at *11-12 (Tex. App.—Austin, January 31, 2014, pet. filed). Indeed, the exercise of the right of association is defined by the statute as follows: APPELLANTS’ BRIEF PAGE 8 “Exercise of the right of association” means a communication between individuals who join together to collectively express, promote, pursue, or defend common interests. Id. § 27.001(2) (emphasis added). The exercise of free speech has broad reach as well: “Exercise of the right of free speech” means a communication made in connection with a matter of public concern. Id. § 27.001(3). Matters of public concern include “an issue related to . . . a good, product, or service in the marketplace.” Id. § 27.001(7)(e). In addition to those broad definitions, the TCPA clearly states that it must “be construed liberally to effectuate its purpose and intent fully.” Id. § 27.011(b)(emphasis added). The TCPA’s scope reaches beyond public participation in government and media defendants. See Combined Law Enforcement Assocs. of Texas v. Sheffield, Cause No. 03-13-00105-CV, 2014 WL 411672, at *2, n.1 (Tex. App.—Austin, January 31, 2014, pet. filed) (“There is nothing in the plain language of the statute that limits its scope, as Sheffield argues, to a media defendant or solely to public participation in government.”) (emphasis added). Rather, this Court recognized that the TCPA reaches beyond constitutional protections “to require a preliminary substantiation of legal actions relating to a broad range of organizational communications.” Id., at *12. APPELLANTS’ BRIEF PAGE 9 Accordingly, this Court found that communications among an organization’s members to promote the organization’s purpose were covered by the TCPA. Id., at *5. 2. Autocraft’s claims are in response to, or relate to, the Precision Parties’ exercise of their freedoms of association and free speech. All of Autocraft’s claims center upon the Precision Parties communications as they promote and pursue their common interests in developing and maintaining a competitive auto body repair business. Autocraft’s claims are based on the alleged disclosure of general business information or the alleged attempts by the Precision Parties “to convince employees to leave Autocraft and join [Precision].” Pl.’s Orig. Pet. at ¶ 13 [CR 6]; see also id. at ¶ 16 (seeking injunctive relief prohibiting communication of alleged confidential information and solicitation of Autocraft’s employees)[CR 6]; id. at ¶ 21 (alleging that the Precision Parties are conspiring to use Autocraft’s alleged trade secrets) [CR 7]; id. at ¶ 28 (claiming that Damian assisted in “unfairly competing with Autocraft,” communicated business information to the other Precision Parties, and communicated with Autocraft employees encouraging them to change jobs). [CR 8] Based on Autocraft’s own pleadings, it is clear that Autocraft’s claims relate to the Precision Parties’ communication in pursuit of their common interest and regarding their services in the marketplace. APPELLANTS’ BRIEF PAGE 10 Beyond the pleadings, the Precision Parties’ evidence likewise establishes that Autocraft’s claims impinge on the Precision Parties’ exercise of their rights of association and free speech. Rey Hernandez testified that on multiple occasions he communicated with Autocraft employees about potential employment opportunities at Precision and, absent Autocraft’s claims in this lawsuit, he expected that he would continue to do so. [CR 26] It is obvious that Borek’s abusive management style was causing Autocraft to hemorrhage employees, with many seeking employment with the Precision Parties and Autocraft filed this suit to prevent communications with its employees that could lead to them relocating. Likewise, Both Hernandez and Damian testified that all of the mundane business practices claimed to be trade secrets in this case were not kept confidential and were well known throughout the industry. [CR 25-27, 29-30] Even so, Autocraft’s claims, if successful, would prevent the Precision Parties from communicating regarding business procedures that are commonly employed in the automobile body repair shop industry. [CR 27, 30] Clearly, the Precision Parties have met their burden establishing that Autocraft’s claims are in response to, or at least relate to, the Precision Parties’ exercise of their rights of association and free speech. Autocraft’s claims seek to curtail the Precision Parties’ use and communication of allegedly proprietary APPELLANTS’ BRIEF PAGE 11 information as they pursue their common interest of their competing business and recruit potential employees. Yet Autocraft wholly failed to put on evidence of the proprietary nature of the information or that the Precision Parties ever used it. The trial court committed reversible error by finding that the TCPA did not apply. B. Because Autocraft wholly failed to meet its evidentiary burden, the trial court was required to dismiss Autocraft’s claims. Because the TCPA applies to Autocraft’s claims, the burden shifted to Autocraft to establish by clear and specific evidence a prima facie case for each essential element of its claims. See Rehak Creative Svcs., Inc., 404 S.W.3d. at 723-724 (discussing the burden-shifting characteristics of the TCPA). Autocraft did not come close to meeting its burden. Autocraft’s sole, conclusory affidavit amounts to no evidence of its claims, and certainly does not provide the clear and specific evidence required by the TCPA. Therefore dismissal of Autocraft’s claims was required. 1. Conclusory statements in affidavits do not constitute “clear and specific evidence.” Conclusory statements without factual foundation do not meet the “clear and specific evidence” burden required by TEX. CIV. PRAC. & REM. CODE § 27.005(c) to avoid dismissal. Thus, a party’s conclusory statements regarding causation in a tortious interference with contract claim failed to meet the TCPA’s burden APPELLANTS’ BRIEF PAGE 12 resulting in the dismissal of the plaintiff’s claims. See Schimmel v. McGregor, 438 S.W.3d 847, 860-862 (Tex. App.—Houston [1st Dist.] 2014, pet. filed) (“We agree with Schimmel that the Buy-Out Owners presented only their conclusory statements, unsupported by any facts, that Schimmel’s actions caused the City of Galveston to fail to close on the purchases.”). Likewise, conclusory statements regarding damages are insufficient to meet the TCPA’s burden of clear and specific evidence. See Rehak Creative Svcs, Inc., 404 S.W.3d at 734 (“This conclusory assertion does not rise to the level of ‘clear and specific’ evidence sufficient to make out a prima facie case of damages caused by and attributable to the alleged misappropriation.”). And this Court has long held that affidavits that do not provide a basis for the affiant’s conclusions or their personal knowledge are fatally defective and constitute no evidence. See Campbell v. Campbell, Cause No. 03-07-00672-CV, 2010 WL 2477782, at *4-5 (Tex. App.—Austin June 18, 2010, no pet.) (finding affidavit insufficient because it did not show the basis for the affiant’s personal knowledge of facts recited therein); Sprayberry v. Siesta MHC Income Partners, L.P., Cause No. 03-08-00649-CV, 2010 WL 1404598, at *3-4 (Tex. App.—Austin April 8, 2010, no pet.) (discussing insufficiency of a conclusory affidavits because it “consists of factual or legal conclusions or APPELLANTS’ BRIEF PAGE 13 opinions that are not supported by facts”). Thus, Autocraft had to present more than conclusory evidence to meet its burden and avoid dismissal. 2. Autocraft failed to submit prima facie case for each essential element of its claims. Autocraft’s sole affidavit submitted in response to the Precision Parties’ Motion to Dismiss misses the mark. Autocraft asserts claims for trade secret misappropriation, unfair competition, and breach of fiduciary duty. Autocraft was required to present clear and specific evidence for each element for each of those claims. See Rehak Creative Svcs, Inc., 404 S.W.3d at 732-734 (analyzing whether plaintiff had provided prima facie evidence of its claims for tortious interference, intentional infliction of emotional distress, conspiracy, and conversion and then dismissing those claims in the absence of evidence). With regard to misappropriation of trade secrets (as well as Autocraft’s other claims relying on such allegations), Autocraft was required to establish all of the elements set forth in TEX. CIV. PRAC & REM. CODE § 134A.002 for both “misappropriation” and “trade secret.” Likewise, all of Autocraft’s causes of action require evidence of damages and causation. See id. § 134A.004 (stating that a claimant seeking damages must prove causation or the amount of a reasonable royalty for the alleged trade secrets); Beck v. Law Offices of Edwin J. (“Ted”) Terry, Jr., P.C., 284 S.W.3d 416, 429 (Tex. App.—Austin 2009, no pet.)(listing APPELLANTS’ BRIEF PAGE 14 elements for breach of fiduciary duty claims including existence of a fiduciary duty, breach of that duty, causation, and damages). 1 Instead of providing clear and specific evidence for its claims, Autocraft instead submitted a sole, conclusory affidavit from John Borek. But Borek’s affidavit is rife with speculation and unsubstantiated conclusions. These include: • “Autocraft has reason to believe David Damian and other former employees who recently left and joined Rey Hernandez and Precision Auto Body . . . may have used or disclosed Autocraft’s confidential, proprietary, and trade secret information . . ..” [CR 42, ¶ 2] (emphasis added) • “After David Damian and Joyce Garcia joined Precision Auto . . . Autocraft learned Prevision Auto was using its proprietary business forms and documents . . ..” [CR 42, ¶ 4] (emphasis added) • “It is my understanding and belief that David Damian and/or Joyce Garcia and possibly others, provided Rey Hernandez with most, if not all, of the above-mentioned confidential, proprietary and trade secret documents and information . . ..” [CR 42, ¶ 6] (emphasis added) • “It is also my understanding and belief that Precision Auto has used Autocraft’s confidential information, including employee salary information, to recruit and solicit more Autocraft employees to join Precision Auto.” [CR 42, ¶ 7] (emphasis added) Statements based on Borek’s understanding or belief do not provide any evidence of Autocraft’s claims and certainly do not provide clear and specific evidence. Furthermore, Borek provides no factual basis to establish his purported personal 1 In addition to these elements, Autocraft was required to submit clear and specific evidence for each element of Autocraft’s other causes of action as well including its claims for injunctive relief, civil conspiracy, and vicarious liability. See, e.g., Chon Tri v. J.T.T., 162 S.W.2d 552, 556 (Tex. 2005) (listing elements for civil conspiracy). APPELLANTS’ BRIEF PAGE 15 knowledge of any actions taken by the Precision Parties or any of his conclusions that the Precision Parties are unfairly competing with him. In fact, Borek’s affidavit provides absolutely no evidence regarding: (1) the efforts Autocraft took, if any, to maintain the secrecy of the alleged proprietary information, (2) the Precision Parties’ appropriation of that information by improper means, or (3) that the information derives economic value from not being generally known or ascertainable by proper means. See TEX. CIV. PRAC. & REM. CODE § 134A.002 (defining the elements to show misappropriation by improper means and the existence of a trade secret). Similarly, and without limitation, Autocraft failed to provide any evidence of damages or causation for its claims. Because Autocraft failed to provide clear and specific evidence for each element of its claims, all of Autocraft’s claims should have been dismissed. C. The Precision Parties are entitled to an award of their reasonable attorneys’ fees and expenses. The trial court likewise erred by failing to award attorneys’ fees and expenses to the Precision Parties. Upon dismissal of an action pursuant to the TCPA, the moving party is entitled to an award of its “court costs, reasonable attorneys’ fees, and other expenses incurred in defending against the legal action.” TEX. CIV. PRAC. & REM. CODE § 27.009. The Precision Parties’ counsel presented evidence, without objection, of their reasonable and necessary attorneys’ fees and APPELLANTS’ BRIEF PAGE 16 expenses incurred at the time of the hearing. [RR 29-30] Because the Precision Parties were entitled to dismissal of Autocraft’s claims under the TCPA, they are entitled to an award of their attorneys’ fees and expenses in the amount of $15,250. D. The trial court erred by refusing to hear live testimony at the hearing on Motion to Dismiss. Although the Precision Parties’ evidence attached to the Motion to Dismiss was sufficient to meet their burden, they were nonetheless prepared to present live testimony at the hearing on the Motion to Dismiss. But the trial court refused to hear that testimony. [RR 22-24] That testimony would have provided additional evidence of the impact Autocraft is urging upon the Precision Parties’ freedoms of association and free speech.2 [RR 24-26] Without limitation, that evidence would have shown that the forms claimed to be trade secrets by Autocraft are well known in the industry and can be freely found and ordered online. That evidence would have also established that the Precision Parties have been restricted from communicating with potential customers and employees. [RR 25-26] The trial court excluded this evidence based upon an unduly narrow reading of section 27.006 which states: 2 The declarations of Hernandez and Damian along with Autocraft’s pleadings provide ample evidence that Autocraft’s claims relate to the Precision Parties’ rights of association and free speech. However, and in the unlikely event that this Court finds that the Precision Parties failed to meet their burden, the proffered but excluded testimony should be considered in that regard. [CR 25-28, 29-31] APPELLANTS’ BRIEF PAGE 17 In determining whether a legal action should be dismissed under this chapter, the court shall 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. While that provision requires the trial court to consider the pleadings and affidavits, it does not restrict the evidence to pleadings and affidavits. The fact that materials other than the pleadings and affidavits may be considered is foreshadowed by other portions of the statute. Indeed, the TCPA allows for other discovery (including depositions or interrogatories) on a showing of good cause. Id. Such discovery would be meaningless if the discovery materials could not be considered as evidence relating to the Motion to Dismiss. The trial court erred by excluding the Precision Parties’ live testimony. CONCLUSION AND PRAYER The Precision Parties were entitled to dismissal of this action. Autocraft’s claims directly impact, and certainly relate to, the Precision Parties’ communications in pursuit of their common interest and regarding their services in the marketplace. Under these circumstances, Autocraft was required by the TCPA to present clear and specific evidence of each element of its claims. Autocraft wholly failed to do so thereby requiring that Autocraft’s action be dismissed and APPELLANTS’ BRIEF PAGE 18 the Precision Parties be awarded their attorneys’ fees and expenses. Accordingly, this Court should provide the Precision Parties the relief they deserve. Accordingly, the Precision Parties respectfully request that this Court reverse the trial court’s order denying the Motion to Dismiss, order that all of Autocraft’s claims in this matter shall be dismissed, award the Precision Parties their attorneys’ fees and expenses described above, and grant the Precision Parties such other and further relief to which they show themselves justly entitled. Respectfully submitted, FRITZ, BYRNE, HEAD & HARRISON, PLLC BY: /s/ Rick Harrison Rick Harrison Texas Bar No. 09120000 rharrison@fbhh.com S. King Texas Bar No. 24067708 aking@fbhh.com Dale L. Roberts Texas Bar No. 24001123 droberts@fbhh.com ATTORNEYS FOR APPELLANTS APPELLANTS’ BRIEF PAGE 19 CERTIFICATE OF SERVICE I hereby certify that a true and correct copy of the foregoing document has this 10th day of March, 2015, been forwarded to counsel of record via electronic service, as follows: James Ruiz Texas Bar No. 17385860 jruiz@winstead.com Jacylyn G. Austein Texas Bar No. 24069760 Jaustein@winstead.com W INSTEAD, P.C. 401 Congress Avenue, Suite 2100 Austin, Texas 78701 Telephone: (512) 370-2818 Facsimile: (512) 370-2850 ATTORNEYS FOR APPELLEES /s/ Rick Harrison Rick Harrison APPELLANTS’ BRIEF PAGE 20 CERTIFICATE OF COMPLIANCE I certify that this brief complies with the word limit of Tex. R. App. P. 9.4(i)(2)(B) because this brief contains 3,616 words, excluding the parts of the brief exempted by Tex. R. App. P. 9.4(i)(1). /s/ Rick Harrison Rick Harrison Dated: March 10, 2015 APPELLANTS’ BRIEF PAGE 21 APPENDIX INDEX ORDER DENYING MOTION TO DISMISS ROBERTS DECLARATION FINDINGS OF FACT AND CONCLUSIONS OF LAW HERNANDEZ DECLARATION DAMIAN DECLARATION BOREK AFFIDAVIT COMBINED LAW ENFORCEMENT ASS’N OF TEXAS V. SHEFFIELD SCHIMMEL V. McGREGOR TEX. CIV. PRAC. & REM CODE § 27.001 – 27.006 DC BK15044 PG310 Filed In The District Court of ~ty, Te~as on flQt,~DI~: at I \:00 lrM. CAUSE NO. D-1-GN-14-004535 Velva 1.. Price, District Clerk AUTOCRAFT BODYWERKS, INC., § IN THE DISTRICT COURT § Plaintiff, § § vs. § § ELITE AUTO BODY LLC, § dba PRECISION AUTO BODY, § REY R. HERNANDEZ, § TRAVIS COUNTY, TEXAS YESICA DIAZ, and § DAVID DAMIAN, § § Defendants, § § vs. § § JOHN BOREK, § § Tltird-Party Defendant. § 345th JUDICIAL DISTRICT ORDER DENYING DEFENDANTS' MOTION TO DISMISS PURSUANT TO CHAPTER 27 OF THE TEXAS CIVIL PRACTICE AND REMEDIES CODE On the 22nd day of January, 2015, the Court heard Defendants' Motion to Dismiss Pursuant to Chapter 27 of the Texas Civil Practice and Remedies Code (the "Motion"). After considering the pleadings, affidavits, and legal arguments, llle-Gourt lind• tlmt Chopter 27 of tl>e ~/. 'Fexas Civil Prac dee and Remedies Code is inapplicable t6 tb:i~ ~ttit. It is therefore, 'I z.~/'.5 ORDERED that the Motion is hereby DENIED in all respects. Signed this 2.~"day of January 2015. 49 CAUSE NO. 03-15-00064-CV In the Court of Appeals For the Third Court of Appeals District Austin, Texas ELITE AUTO BODY LLC, d/b/a PRECISION AUTO BODY, REY R. HERNANDEZ, YESICA DIAZ, AND DAVID DAMIAN, Appellants, v. AUTOCRAFT BODYWERKS, INC., now known as WASSON ROAD VENTURES, INC., d/b/a AUTOCRAFT BODYWERKS, Appellee. DECLARATION OF DALE L. ROBERTS 1. My name is Dale L. Roberts. I am fully competent to make this Declaration. I have personal knowledge of the facts stated in this Declaration. I am one of the attorneys representing the Appellants in this matter. 2. The Finding of Fact and Conclusions of Law contained in the Appendix of Appellants’ Brief is a true and correct copy of that signed by Judge Sulak on February 20, 2015. 3. My name is Dale L. Roberts. My date of birth is February 6, 1970, and my address is 1309 Choquette Drive, Austin, Texas 78757. As authorized by Section 132.001 of the Texas Civil Practice and Remedies 1 Code, I declare under penalty of perjury that the foregoing is true and correct. Executed in Travis County, State of Texas, on March 10, 2015. /s/ Dale L. Roberts Dale L. Roberts 2 CAUSE NO. D-1-GN-14-004535 AUTOCRAFT BODYWERKS, INC., § IN THE DISTRICT COURT now known as WASSON ROAD § VENTURES, INC, dba AUTOCRAFT § · BODYWERKS, § § Plaintiff, § § § vs. § TRAVIS COUNTY, TEXAS § ELITE AUTO BODY LLC, d/b/a PRECISION § AUTO BODY, REY R. HERNANDEZ, § YESICA DIAZ, AND DAVID DAMIAN, § § Defendants. § DECLARATION OF REY R. HERNANDEZ 1. My name is Rey R. Hernandez. I am fully competent to make this Declaration. I have personal knowledge of all the facts stated in this Declaration. 2. I have been working in the auto body manufacture or repair industry for over 19 years. I have worked for BMW for over 12 years, achieving a management position overseeing body work on new BMW vehicles. In addition, I have worked in auto body repair shops for seven years. 3. Through my experience in the auto body repair industry, I have become aware of common practices employed by auto body repair shops. It is common practice in the industry to use forms and checklists for tracking payment receipts, insurance information, workflow assignments and other information. Although the forms and checklists may follow different formats, they commonly contain information such as payment, information, authorizations, and vehicle and customer information. Page I 4R£4&&&4Zi&&2SEE&EE I EXHIBIT 1 25 4. When I came to Austin in 2008, I accepted a job as a production manager at Autocraft Bodywerks ("AB") and worked there for approximately twelve months. During that time, the working conditions at AB were very unpleasant and hostile. AB's former owner, and now manager, John Borek, created that unpleasant working environment. For example, Mr. Borek frequently used abusive and vulgar language when speaking with employees and threatened them with reprisals, illegally withheld paychecks, and on occasion, physically assaulted them. Despite Mr. Borek's behavior, it was my impression that AB's employees were very competent and often talented. 5. While working at AB, I was never asked to sign or even agree to any limitations on my ability to compete with AB or solicit AB's employees following my employment. Likewise, I was never asked to sign a confidentiality agreement nor was I informed that any information about how AB conducted its business was secret or confidential. In fact, with the exception of Mr. Borek's behavior, AB's business was conducted similar to other auto body repair businesses. This included the use and content of AB's forms and checklists as well as referencing, when necessary, any technical service bulletins relating to a repair. I was never told by Mr. Borek, or anyone else, that AB's forms, checklists or compilation of technical service bulletins were secret or confidential, and I did not consider them to be secret because the use of similar forms, checklists and technical service bulletins is commonplace in the industry. 6. Due in large part to the unhealthy working environment caused by Mr. Borek, I left AB, and started Precision Auto Body ("Precision") in March, 2009. Over the next several years and through my experience in the industry, we developed Precision into a successful business. As part of that business, Precision subscribed to Alldata. That service provides access to, and the ability to search, all technical service bulletins that have been issued by all automobile Page2 26 manufacturers. Precision remains a subscriber to that setvice to this day. Whenever a Precision employee needs to reference a technical setvice bulletin, the materials are obtained from Alldata. 7. By the beginning of 2014, Precision had seven employees and the business was continuing to grow. In March 2014, Precision hired David Damian to work as body shop manager. Over the years since leaving AB, I have occasionally been contacted by AB employees inquiring as to whether Precision could hire them, and on some occasions Precision has done so. That is how Damian came to work for Precision as well as Joyce Garcia. Mr. Damian, Ms. Joyce, and I have all expressed a desire to continue to grow Precision's business and attract experienced and talented individuals to work for Precision. 8. Because it was my impression that many of AB's employees were talented, I would expect and intend to communicate with AB employees regarding employment opportunities at Precision just as I would expect to communicate with any other potential Precision employees that are unrelated to AB. If AB is successful in its lawsuit, or even obtains a temporary i-qjunction as it has requested, I would not be able to communicate with any other AB employees about potential employment opportunities. 9. Precision has not used any confidential or secret information in its business that was disclosed by either Mr. Damian or Joyce Garcia. Precision has not used any AB payroll or other AB financial information in arty manner. This includes, without limitation, any employment decisions concerning any current or potential Precision employees. With regard to the business practices claimed by AB to be confidential or secret, these allegations would prevent me and others at Precision from communicating regarding mundane business issues such as using checklists and forms to ensure that office and shop procedures are followed. Page3 27 10. My name is Rey R. Hemandez. My date of birth is January 4, 1976, and my address is 1261 Cherrywood, Kyle, Texas 78640. As authorized by Section 132.001 of the Texas Civil Practice and Remedies Code, I declare under penalty of peljury that the foregoing is true and correct. Executed in Travis County, State of Texas on this~O th day of December, 20 Page4 28 CAUSE NO. D-1-GN-14-004535 AUTOCRAFT BODYWERKS, INC., § IN THE DISTRICT COURT now known as WASSON ROAD § VENTURES, INC. dba AUTOCRAFT § BODYWERKS, § § Plaintiff, § § § vs. § TRAVIS COUNTY, TEXAS § ELITE AUTO BODY LLC, d/b/a PRECISION § AUTO BODY, REY R. HERNANDEZ, § YESICA DIAZ, AND DAVID DAMIAN, § § Defendants, § DECLARATION OF DAVID DAMIAN 1. My name is David Damian. I am fully competent to make this Declaration. I have personallmowledge of all the facts stated in this Declaration. 2. I have been working in the auto body repair industry for over 16 years. Through my experience in the auto body repair industry, I have become aware of common practices employed by auto body repair shops. It is common practice in the indushy to use forms and checklists for tracking payment receipts, insurance information, workflow assignments and other information. 3. Between 2008 until March 2014, !.worked as a Production Manager at Autocraft Bodywerks ("AB"). During that time, the working conditions at AB were very unpleasant and hostile. AB's former owner, and now manager, John Borek, created that unpleasant working environment. Mr. Borek constantly cursed at employees and was prone to angry outbursts. Page 1 EXHIBIT W4E&E&MUMIM 1(1 :a 29 4. While working at AB, I was never asked to sign, or even agree to, any limitations on my ability to compete with AB or solicit AB's employees following my employment. Likewise, I was never asked to sign a confidentiality agreement nor was I informed that any information about how AB conducted its business was secret or confidential. AB's business was conducted similar to other auto body repair businesses. This included the use and content of AB's forms and checklists as well as referencing, when necessary, any technical service bulletins relating to a repair. I was never told by Mr. Borek, or anyone else, that AB's forms, checklists or compilation of technical service bulletins were secret or confidential, and I did not consider them to be secret because the use of similar forms, checklists and technical service bulletins is commonplace in the industry. 5. Due in large part to the unhealthy working environment caused by Mr. Borek, I left AB, and joined Precision. Mr. Hernandez, Ms. Garcia, and I have all expressed a desire to continue to grow Precision's business and attract experienced and talented individuals to work for Precision. 6. I have not used any AB payroll or other AB financial information in any manner since leaving the employ of AB, and certainly not in any negotiations or business decisions. With regard to the business practices claimed by AB to be confidential or secret, these allegations would prevent me and others at Precision from communicating regarding mundane business issues such as using checklists and forms to ensure that office and shop procedures are followed. Page 2 30 7. My name is David Damian. My date of birth is June 10, 1978, and my address is 11303 Stormy Ridge Road, Austin, Texas 78739. As authorized by Section 132.001 of the Texas Civil Practice and Remedies Code, I declare under penalty of perjury that the foregoing is true and correct. Executed in Travis County, State of Texas on this lOth day of December, 2014. Page 3 31 CAUSE NO. D-1-GN-14-004535 AUTOCRAFT BODYWERKS, INC., § IN THE DISTRICT COURT § Plaintiff. § § vs. § § ELITE AUTO BODY LLC, § dba PRECISION AUTO BODY, § REY R. HERNANDEZ, § TRAVIS COUNTY, TEXAS YESICA DIAZ, and § DAVID DAMIAN, § § Defendants, § § vs. § § JOHN BOREK, § § Third-Party Defendant. § 345th JUDICIAL DISTRICT AFFIDAVIT OF JOHN BOREK STATE OF TEXAS § § ( CIVIL PRACTICE AND REMEDIES CODE > TITLE 2. TRIAL, JUDGMENT, AND APPEAL > SUBTITLE B. TRIAL MATTERS > CHAPTER 27. ACTIONS INVOLVING THE EXERCISE OF CERTAIN CONSTITUTIONAL RIGHTS § 27.001. Definitions In this chapter: (1) "Communication" includes the making or submitting of a statement or document in any form or medium, including oral, visual, written, audiovisual, or electronic. (2) "Exercise of the right of association" means a communication between individuals who join together to collectively express, promote, pursue, or defend common interests. (3) "Exercise of the right of free speech" means a communication made in connection with a matter of public concern. (4) "Exercise of the right to petition" means any of the following: (A) a communication in or pertaining to: (i) a judicial proceeding; (ii) an official proceeding, other than a judicial proceeding, to administer the law; (iii) an executive or other proceeding before a department of the state or federal government or a subdivision of the state or federal government; (iv) a legislative proceeding, including a proceeding of a legislative committee; (v) a proceeding before an entity that requires by rule that public notice be given before proceedings of that entity; (vi) a proceeding in or before a managing board of an educational or eleemosynary institution supported directly or indirectly from public revenue; (vii) a proceeding of the governing body of any political subdivision of this state; (viii) a report of or debate and statements made in a proceeding described by Subparagraph (iii), (iv), (v), (vi), or (vii); or (ix) a public meeting dealing with a public purpose, including statements and discussions at the meeting or other matters of public concern occurring at the meeting; (B) a communication in connection with an issue under consideration or review by a legislative, executive, judicial, or other governmental body or in another governmental or official proceeding; (C) a communication that is reasonably likely to encourage consideration or review of an issue by a legislative, executive, judicial, or other governmental body or in another governmental or official proceeding; (D) a communication reasonably likely to enlist public participation in an effort to effect consideration of an issue by a legislative, executive, judicial, or other governmental body or in another governmental or official proceeding; and (E) any other communication that falls within the protection of the right to petition government under the Page 2 of 2 Tex. Civ. Prac. & Rem. Code § 27.001 Constitution of the United States or the constitution of this state. (5) "Governmental proceeding" means a proceeding, other than a judicial proceeding, by an officer, official, or body of this state or a political subdivision of this state, including a board or commission, or by an officer, official, or body of the federal government. (6) "Legal action" means a lawsuit, cause of action, petition, complaint, cross-claim, or counterclaim or any other judicial pleading or filing that requests legal or equitable relief. (7) "Matter of public concern" includes 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. (8) "Official proceeding" means any type of administrative, executive, legislative, or judicial proceeding that may be conducted before a public servant. (9) "Public servant" means a person elected, selected, appointed, employed, or otherwise designated as one of the following, even if the person has not yet qualified for office or assumed the person's duties: (A) an officer, employee, or agent of government; (B) a juror; (C) an arbitrator, referee, or other person who is authorized by law or private written agreement to hear or determine a cause or controversy; (D) an attorney or notary public when participating in the performance of a governmental function; or (E) a person who is performing a governmental function under a claim of right but is not legally qualified to do so. History Enacted by Acts 2011, 82nd Leg., ch. 341 (H.B. 2973), § 2, effective June 17, 2011. LexisNexis ® Texas Annotated Statutes Copyright © 2015 by Matthew Bender & Company, Inc. a member of the LexisNexis Group All rights reserved. Tex. Civ. Prac. & Rem. Code § 27.002 This document is current through the 2013 3rd Called Session Texas Statutes and Codes > CIVIL PRACTICE AND REMEDIES CODE > TITLE 2. TRIAL, JUDGMENT, AND APPEAL > SUBTITLE B. TRIAL MATTERS > CHAPTER 27. ACTIONS INVOLVING THE EXERCISE OF CERTAIN CONSTITUTIONAL RIGHTS § 27.002. Purpose The purpose of this chapter is 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. History Enacted by Acts 2011, 82nd Leg., ch. 341 (H.B. 2973), § 2, effective June 17, 2011. LexisNexis ® Texas Annotated Statutes Copyright © 2015 by Matthew Bender & Company, Inc. a member of the LexisNexis Group All rights reserved. Tex. Civ. Prac. & Rem. Code § 27.003 This document is current through the 2013 3rd Called Session Texas Statutes and Codes > CIVIL PRACTICE AND REMEDIES CODE > TITLE 2. TRIAL, JUDGMENT, AND APPEAL > SUBTITLE B. TRIAL MATTERS > CHAPTER 27. ACTIONS INVOLVING THE EXERCISE OF CERTAIN CONSTITUTIONAL RIGHTS § 27.003. Motion to Dismiss (a) If a legal action is based on, relates to, or is in response to a party's exercise of the right of free speech, right to petition, or right of association, that party may file a motion to dismiss the legal action. (b) A motion to dismiss a legal action under this section must be filed not later than the 60th day after the date of service of the legal action. The court may extend the time to file a motion under this section on a showing of good cause. (c) Except as provided by Section 27.006(b), on the filing of a motion under this section, all discovery in the legal action is suspended until the court has ruled on the motion to dismiss. History Enacted by Acts 2011, 82nd Leg., ch. 341 (H.B. 2973), § 2, effective June 17, 2011. LexisNexis ® Texas Annotated Statutes Copyright © 2015 by Matthew Bender & Company, Inc. a member of the LexisNexis Group All rights reserved. Tex. Civ. Prac. & Rem. Code § 27.004 This document is current through the 2013 3rd Called Session Texas Statutes and Codes > CIVIL PRACTICE AND REMEDIES CODE > TITLE 2. TRIAL, JUDGMENT, AND APPEAL > SUBTITLE B. TRIAL MATTERS > CHAPTER 27. ACTIONS INVOLVING THE EXERCISE OF CERTAIN CONSTITUTIONAL RIGHTS § 27.004. Hearing (a) A hearing on a motion under Section 27.003 must be set not later than the 60th day after the date of service of the motion unless the docket conditions of the court require a later hearing, upon a showing of good cause, or by agreement of the parties, but in no event shall the hearing occur more than 90 days after service of the motion under Section 27.003, except as provided by Subsection (c). (b) In the event that the court cannot hold a hearing in the time required by Subsection (a), the court may take judicial notice that the court's docket conditions required a hearing at a later date, but in no event shall the hearing occur more than 90 days after service of the motion under Section 27.003, except as provided by Subsection (c). (c) If the court allows discovery under Section 27.006(b), the court may extend the hearing date to allow discovery under that subsection, but in no event shall the hearing occur more than 120 days after the service of the motion under Section 27.003. History Enacted by Acts 2011, 82nd Leg., ch. 341 (H.B. 2973), § 2, effective June 17, 2011; am. Acts 2013, 83rd Leg., ch. 1042 (H.B. 2935), § 1, effective June 14, 2013. LexisNexis ® Texas Annotated Statutes Copyright © 2015 by Matthew Bender & Company, Inc. a member of the LexisNexis Group All rights reserved. Tex. Civ. Prac. & Rem. Code § 27.005 This document is current through the 2013 3rd Called Session Texas Statutes and Codes > CIVIL PRACTICE AND REMEDIES CODE > TITLE 2. TRIAL, JUDGMENT, AND APPEAL > SUBTITLE B. TRIAL MATTERS > CHAPTER 27. ACTIONS INVOLVING THE EXERCISE OF CERTAIN CONSTITUTIONAL RIGHTS § 27.005. Ruling (a) The court must rule on a motion under Section 27.003 not later than the 30th day following the date of the hearing on the motion. (b) Except as provided by Subsection (c), on the motion of a party under Section 27.003, a court shall dismiss a legal action against the moving party 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 party's exercise of: (1) the right of free speech; (2) the right to petition; or (3) the right of association. (c) The court may not dismiss a legal action under this section if the party bringing the legal action establishes by clear and specific evidence a prima facie case for each essential element of the claim in question. (d) Notwithstanding the provisions of Subsection (c), the court shall dismiss a legal action against the moving party if the moving party establishes by a preponderance of the evidence each essential element of a valid defense to the nonmovant's claim. History Enacted by Acts 2011, 82nd Leg., ch. 341 (H.B. 2973), § 2, effective June 17, 2011; am. Acts 2013, 83rd Leg., ch. 1042 (H.B. 2935), § 2, effective June 14, 2013. LexisNexis ® Texas Annotated Statutes Copyright © 2015 by Matthew Bender & Company, Inc. a member of the LexisNexis Group All rights reserved. Tex. Civ. Prac. & Rem. Code § 27.006 This document is current through the 2013 3rd Called Session Texas Statutes and Codes > CIVIL PRACTICE AND REMEDIES CODE > TITLE 2. TRIAL, JUDGMENT, AND APPEAL > SUBTITLE B. TRIAL MATTERS > CHAPTER 27. ACTIONS INVOLVING THE EXERCISE OF CERTAIN CONSTITUTIONAL RIGHTS § 27.006. Evidence (a) In determining whether a legal action should be dismissed under this chapter, the court shall consider the pleadings and supporting and opposing affidavits stating the facts on which the liability or defense is based. (b) On a motion by a party or on the court's own motion and on a showing of good cause, the court may allow specified and limited discovery relevant to the motion. History Enacted by Acts 2011, 82nd Leg., ch. 341 (H.B. 2973), § 2, effective June 17, 2011. LexisNexis ® Texas Annotated Statutes Copyright © 2015 by Matthew Bender & Company, Inc. a member of the LexisNexis Group All rights reserved.