HOUSTON – A Harris County district court was too quick to deny a motion to dismiss a Flower Mound-based staff leasing and human resources countersuit in Texas Citizens' Participation Act (TCPA) litigation with a former employee, a Texas appeals court recently ruled.
"Our review of the record indicates that the trial court failed to analyze the motion on its merits under the framework required by the TCPA," Texas 14th Court of Appeals Justice Martha Hill Jamison said in the three-justice panel's 11-page opinion issued June 7. "Accordingly, we reverse the trial court's order denying the motion and remand this case for proceedings consistent with this opinion."
The other two justices on the panel were Justice William J. Boyce and Justice Marc Brown.
The appeals court handed down its opinion in the interlocutory appeal by appellant William Reeves challenging 55th District Court of Harris County's earlier denial of his motion to dismiss the countersuit of his former employer, Harbor America Central.
Reeves started out as an independent contractor working for Harbor America Central and was later hired as regional sales leader and still later was promoted to national sales leader. Reeves' employment agreement with Harbor America Central included a covenant not to solicit and confidential information provision that basically acted as a noncompete agreement in the year following termination of his employment.
Reeves resigned from Harbor America Central in 2016 and started his own competing company, Harvest Works Consulting, and later sued Harbor America Central, claiming breach of contract. Reeves alleged that Harbor America didn't pay him commissions owed under the employment agreement.
For its part, Harbor America Central countersued for breach of contract, misappropriation of trade secrets, conversion and breach of fiduciary duty of loyalty.
Reeves filed a motion asking the district court to dismiss Harbor America Central's countersuit, claiming in part that his former employer could not make its case. The district court denied the motion before Harbor America Central had even filed an answer to Reeve's motion, saying in a footnote that no oral argument or briefing was required and that Reeve's motion "is being used as an excuse not to participate in discovery ordered by the court and agreed to by the parties in a binding Rule 11 agreement."
"The [TCPA] as a matter of law does not allow a party to avoid contractual obligations such as the ones at issue here," the appeals court's opinion quoted from the district court's decision.
In his appeal, Reeves argued the district court was wrong to deny his motion to dismiss because it failed to analyze whether he'd met his initial burden under the TCPA and that the district court should have concluded he had met that burden.
"He specifically contends that the trial court improperly denied the motion on the grounds that it was filed to avoid discovery and to avoid contractual obligations," the opinion said.