May 15, 2021

Volume XI, Number 135

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Business Divorce: Court Affirms Denial Of SLAPP Motion Regarding Partnership Divorce Suit

In TSA-Tex. Surgical Assocs., L.L.P. v. Vargas, one partner sued his other partners for various claims regarding the defendants attempt to squeeze the plaintiff out of the partnership. No. 14-19-00135-CV, 2021 Tex. App. LEXIS 1330 (Tex. App.—Houston [14th Dist.] February 25, 2021, no pet. history). The defendants filed a motion to dismiss under the Texas Citizens Participation Act (TCPA), and the trial court denied the motion. The defendants appealed.

The TCPA was enacted “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.” Id. (citing Tex. Civ. Prac. & Rem. Code § 27.002). It does so by authorizing a party to file a motion to dismiss a legal action that “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.” Id.

The court of appeals affirmed the denial of the motion to dismiss under the TCPA. The defendants argued that the plaintiff’s claims were based on, related to, or in response to the exercise of free speech because the claims purportedly involve communications regarding the provision of medical services. The court of appeals disagreed:

We do not agree that Vargas’s claims are based on communications regarding the provision of medical services because the communications at issue relate to Vargas’s withdrawal from the partnership and occurred after Vargas stopped practicing medicine. This case involves a private contract dispute affecting only the fortunes of the partners. The alleged representations were made to a limited business audience concerning a business dispute among the partners related to Vargas’s withdrawal from the partnership. Because the statements are not relevant to a wider audience of potential patients, the statements were not made “in connection with a matter of public concern.” The issues presented by this case are simply not a matter of public concern.

Id. The court of appeals also addressed whether plaintiff’s claims were based on, related to, or in response to the exercise of the right of association. The exercise of the right of association is defined in the applicable version of the TCPA as “a communication between individuals who join together to collectively express, promote, pursue, or defend common interests.” The court held that the communications did not constitute an exercise of the right of association:

We have defined the word “common” in the TCPA to mean “of or relating to a community at large: public.” The only communications at issue in Vargas’s claims are based on Vargas’s allegations that appellants (1) breached the Partnership Agreement and breached their fiduciary duties by “making false statements and denying [Vargas] access to important records,” (2) wrongfully assumed and exercised control over Vargas’s partnership interest, (3) sought to deprive Vargas of his partnership interest, and (4) attempted to fraudulently induce Vargas “to surrender his stake in the venture below its proper value.” These communications therefore are related to disagreements about Vargas’s withdrawal from the partnership. These communications concern a private transaction between private parties, not a matter of “common interest,” as we have held that expression is used in the applicable version of the TCPA. Accordingly, the communications do not constitute an exercise of the right of association protected by the TCPA.

Id.

 

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© 2021 Winstead PC.National Law Review, Volume XI, Number 101
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About this Author

David Johnson Financial Institution lLtigation Winstead Law Firm Fort Worth Texas
Managing Shareholder - Fort Worth

David maintains an active trial and appellate practice and has consistently worked on financial institution litigation matters throughout his career. David is the primary author of the Texas Fiduciary Litigator blog, which reports on legal cases and issues impacting the fiduciary field in Texas. 

David's financial institution experience includes (but is not limited to): breach of contract, foreclosure litigation, lender liability, receivership and injunction remedies upon default, non-recourse and other real estate lending, class...

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