Naman Howell Smith & Lee PLLC (NHSL) v. Joe A. Gamez Law Firm, P.C.

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NAMAN HOWELL SMITH & LEE PLLC (NHSL) and DAVID ORTEGA, Appellants, v. JOE A. GAMEZ LAW FIRM, P.C., and JOE A. GAMEZ, Individually, Appellees.

No. 08-23-00324-CV

Court of Appeals of Texas, Eighth District, El Paso

July 29, 2024

Appeal from 37th Judicial District Court of Bexar County, Texas (TC# 2021-CI-09973)

Before Alley, C.J., Palafox, and Soto, JJ.

MEMORANDUM OPINION

LISA J. SOTO, Justice

David Ortega and his law firm, Naman Howell Smith & Lee PLLC (collectively, Ortega), appeal from the trial court's order denying his request to dismiss Joe A. Gamez and his law firm's (collectively, Gamez) lawsuit under the Texas Citizens Participation Act (TCPA). Based on the commercial-speech exemption, we affirm the trial court's order.^[1]

I. Background

In August 2020, Alvin and Dorothy Lofton were involved in an automobile collision with a vehicle driven by Ruben Trevino and owned by several Renegade Well Services corporate entities. The Loftons suffered injuries and damage to their property. Four days after the collision the Loftons hired Gamez to sue Trevino and Renegade. They signed a contingency fee agreement with Gamez, in which they agreed to pay him a percentage of their recovery plus any advanced expenses. The agreement permitted the Loftons to terminate Gamez's services, but if the termination was without Gamez's consent, Gamez would retain his fee interest in their claims.

The Loftons allege various concerns with Gamez's representation, including that (1) during his representation they "never met with any lawyers," (2) Gamez purportedly violated his fiduciary duties to the Loftons by withholding their personal injury protection coverage proceeds, and (3) even though Ms. Lofton was entitled to free medical care through the Veterans Administration, Gamez referred Ms. Lofton to a private practice surgeon (which effectively reduced the Loftons' recovery but increased the total damages).

On April 20, 2021, Ortega met with the Loftons. Ortega attested that a friend who knows the Loftons asked him if he could consult with the family regarding their concerns about Gamez's representation in their personal injury suit. Ortega agreed and charged the Loftons an hourly fee for his services. At their meeting, Ortega recommended several personal injury lawyers who could represent the Loftons if they decided to terminate Gamez, including Scott Westlund with Ketterman, Rowland & Westlund.

The Loftons agree that after they met with Ortega, they decided to terminate Gamez; however, they did not do so immediately. On June 23, 2021, Gamez filed the Loftons' original petition against Trevino and Renegade. On July 16, 2021, the Loftons terminated Gamez's representation. They then secured representation from Westlund, who resolved their case.

On May 18, 2023, Gamez filed this suit, asserting, among other things, a tortious interference claim against Ortega. Ortega filed a Rule 91a motion to dismiss based on attorney immunity. In response, Gamez amended his petition to clarify that Ortega's alleged tortious interference occurred before the formation of an attorney-client relationship. After a hearing, the trial court denied the Rule 91a motion.

Ortega also filed a TCPA motion to dismiss. After a hearing, the trial court indicated it would grant the TCPA motion to dismiss and instructed Ortega to submit his attorney's fees request. Gamez filed a motion to reconsider, citing a Fourth Court of Appeals case involving the TCPA's commercial-speech exemption. See Grable Grimshaw Mora, PLLC v. Christopher J. Weber, LLC, No. 04-21-00064-CV, 2021 WL 3057500 (Tex. App.-San Antonio July 21, 2021, pet. denied) (mem. op.). After another hearing, the trial court denied the TCPA motion to dismiss, agreeing "that the commercial speech exemption applies" to the claims against Ortega.

Ortega brought this accelerated interlocutory appeal. See Tex. Civ. Prac. & Rem. Code Ann. § 51.014(a)(12).

II. Standard of Review and Applicable Law

The TCPA "protects speech on matters of public concern by authorizing courts to conduct an early and expedited review of the legal merit of claims that seek to stifle speech through the imposition of civil liability and damages." Lilith Fund for Reprod. Equity v. Dickson, 662 S.W.3d 355, 363 (Tex. 2023). It "was designed to protect both a defendant's rights of speech, petition, and association and a claimant's right to pursue valid legal claims for injuries the defendant caused." Montelongo v. Abrea, 622 S.W.3d 290, 295 (Tex. 2021) (citing Tex. Civ. Prac. & Rem. Code Ann. § 27.002). If a legal action is "based on or is in response to" the exercise of one of the statutorily enumerated rights, the defendant may seek dismissal under the TCPA. Yu v. Koo, 633 S.W.3d 712, 720 (Tex. App.-El Paso 2021, no pet.).

The TCPA provides a burden-shifting framework for dismissing a legal action to which it applies. Montelongo, 622 S.W.3d at 295 (citing Castleman v. Internet Money Ltd., 546 S.W.3d 684, 686 (Tex. 2018) (per curiam)).

First, the party seeking dismissal must show the TCPA applies by demonstrating that the nonmovant's suit is based on or in response to a party's exercise of the right of free speech, right to petition, or right of association. Tex. Civ. Prac. & Rem. Code Ann. §§ 27.003(a), .005(b). If the movant fails to meet this initial burden, the motion to dismiss fails. See id. § 27.005(b). If the movant shows that the TCPA applies, the nonmovant must then establish by "clear and specific evidence" a prima facie case for each essential element of its claims. Id. § 27.005(c). Alternatively, the nonmovant may avoid its burden of demonstrating a prima facie case by showing that one of the TCPA's many exemptions apply. RigUp, Inc. v. Sierra Hamilton, LLC, 613 S.W.3d 177, 182 (Tex. App.-Austin 2020, no pet.); see Tex. Civ. Prac. & Rem. Code Ann. § 27.010(a). Finally, if the TCPA applies and the nonmovant establishes a prima facie case, the burden then shifts back to the movant to establish "an affirmative defense or other grounds on which the moving party is entitled to judgment as a matter of law." Tex. Civ. Prac. & Rem. Code Ann. § 27.005(d).

We review a trial court's ruling on a TCPA motion to dismiss de novo. Herrera v. Stahl, 441 S.W.3d 739, 741 (Tex. App.-San Antonio 2014, no pet.). In determining whether dismissal under the TCPA is proper, courts consider "the pleadings, evidence a court could consider under Rule 166a, Texas Rules of Civil Procedure, and supporting and opposing affidavits stating the facts on which the liability or defense is based." Tex. Civ. Prac. & Rem. Code Ann. § 27.006(a). The court views the pleadings and evidence in the light most favorable to the nonmovant. Buzbee v. Canales, 621 S.W.3d 802, 807 (Tex. App.-El Paso 2021, pet. denied).

III. Analysis

In his sole issue on appeal, Ortega argues the trial court erred by denying his motion to dismiss Gamez's claims under the TCPA. Gamez responds that the trial court properly denied the TCPA motion based on the commercial-speech exemption. Gamez further contends that even if the trial court erred in applying the commercial-speech exemption, it could have properly denied the motion on other grounds, including that Ortega failed to establish that the TCPA applies, Gamez proved a prima facie case for each challenged element of its tortious interference claim, and Ortega failed to establish an affirmative defense. Assuming without deciding that the TCPA applies here, we conclude that the trial court correctly denied the TCPA motion to dismiss based on the commercial-speech exemption. Thus, our analysis begins and ends there.^[2]

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 Ann. § 27.010(a)(2). The Texas Supreme Court has characterized the commercial-speech exemption as having four elements: "(1) the defendant was primarily engaged in the business of selling or leasing goods, (2) the defendant made the statement or engaged in the conduct on which the claim is based in the defendant's capacity as a seller or lessor of those goods or services, (3) the statement or conduct at issue arose out of a commercial transaction involving the kind of goods or services the defendant provides, and (4) the intended audience of the statement or conduct were actual or potential customers of the defendant for the kind of goods or services the defendant provides." Castleman, 546 S.W.3d at 688.

The burden of establishing all four elements of the commercial-speech exemption is on the nonmovant, i.e., the party claiming it applies. RigUp, 613 S.W.3d at 187. Ortega does not challenge the first and second elements; instead, he contends Gamez failed to meet his burden to demonstrate the third and fourth elements are satisfied. Ant45

A. The alleged misconduct arose out of a commercial transaction involving the kind of services Ortega provides.

As to the third element, Ortega asserts that because he is not a plaintiff's personal injury attorney and did not even attempt to represent the Loftons in their personal injury case, Gamez cannot establish that "the statement or conduct at issue arose out of a commercial transaction involving the kind of goods or services [Ortega] provides." Castleman, 546 S.W.3d at 688. Ortega argues that he gave "limited ethical advice" to the Loftons, to whom he was connected by a mutual friend, and had no economic interest in the...