Neal Rouzier, M.D. v. BioTE Medical, LLC

Citation: Not availableDocket: 05-19-00277-CV

Court: Court of Appeals of Texas; November 21, 2019; Texas; State Appellate Court

Original Court Document: View Document

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The Court of Appeals affirmed the trial court's denial of Dr. Neal Rouzier's motion to dismiss BioTE Medical, LLC's claims under the Texas Citizen’s Participation Act (TCPA) in an interlocutory appeal. Rouzier raised six issues, asserting that the TCPA applied to BioTE's claims, that BioTE did not prove the commercial speech exemption, lacked clear evidence for its claims, failed to show causation and damages, had claims preempted by the Texas Uniform Trade Secret Act (TUTSA), and that the trial court erred by not ruling on his objections to BioTE's evidence. 

BioTE's lawsuit against Rouzier included claims for breach of fiduciary duty, misappropriation of trade secrets, and common law misappropriation, alleging that he misappropriated confidential information after leaving the company for a competitor, EvexiPEL. BioTE claimed Rouzier conspired with EvexiPEL to unlawfully solicit its contracted physicians, misappropriate trade secrets, and engage in unfair competition. Rouzier's motion to dismiss relied on the argument that BioTE's claims were based on his rights of free speech and association, but he submitted no supporting evidence. In response, BioTE conducted limited discovery, including a deposition, and argued that Rouzier did not show the TCPA applied and that it met its burden of evidence for its claims.

Affidavits from two BioTE executives and excerpts from Rouzier's deposition were included in BioTE's response, with Rouzier objecting to parts of the affidavit evidence, although the trial court did not address these objections. Rouzier subsequently filed a reply with his complete deposition. A hearing on Rouzier's motion to dismiss occurred on January 16, 2019, and the trial court denied the motion on February 8, prompting Rouzier's appeal.

Rouzier argues that the trial court erred in denying his TCPA motion to dismiss, claiming BioTE's lawsuit was retaliatory and aimed at silencing his free speech and association rights, and contends that the TCPA's exemption for commercial speech does not apply. The TCPA is designed to protect citizens from lawsuits intended to intimidate or silence them while also allowing meritorious claims. The act encourages the exercise of constitutional rights and provides a streamlined process for dismissing claims meant to suppress first amendment rights. The movant must initially demonstrate that the legal action relates to their free speech or association rights, after which the burden shifts to the non-movant to show a prima facie case for each claim element.

The trial court's ruling on TCPA motions is reviewed de novo, considering the pleadings and affidavits in favor of the non-movant. The TCPA specifically addresses communications, defining the right of association as collective communication promoting common interests and the right of free speech as communication regarding public concerns. The trial court may also permit limited discovery relevant to the motion.

Rouzier contends that BioTE's claims stem from communications regarding medical services involving him and EvexiPEL, which he argues invokes his right of association. He acknowledges that this case is "derivative of" and "nearly identical" to a previous case, *Forget About It, Inc. v. BioTE Med. LLC*, where it was determined that interpreting the Texas Citizens Participation Act (TCPA) to protect a right of association based on private communications related to misappropriation of trade secrets would contradict the TCPA's intent to prevent strategic lawsuits against public participation. The court finds no difference between the communications in this case and those in *Forget About It*, adhering to its prior ruling in the absence of a legal change. Furthermore, Rouzier's claim that his communications involved freedom of speech concerning public health issues is dismissed, as BioTE alleges that he conspired with EvexiPEL to solicit physicians to breach contracts with BioTE and exploit its confidential information to compete unfairly. BioTE’s CEO notes that Rouzier's involvement allowed EvexiPEL to bypass significant startup costs. The court emphasizes that discussions regarding purported tortious conduct do not qualify as matters of public concern, even if related to the healthcare sector. Rouzier did not provide evidence indicating that BioTE’s claims were based on communications outside those mentioned in the petition and affidavits. Additionally, while Rouzier claims his communications with physicians about hormone therapy fall under TCPA protections, BioTE counters that these communications were commercial speech, which is exempt from the TCPA's coverage.

The commercial speech exemption is applicable when four criteria are met: (1) the defendant is primarily engaged in selling or leasing goods or services; (2) the statement or conduct in question was made in the defendant’s capacity as a seller or lessor; (3) the statement or conduct arose from a commercial transaction involving the defendant's goods or services; and (4) the intended audience consisted of actual or potential customers for those goods or services. The party claiming the exemption bears the burden of proof, but a sufficient affirmative allegation of facts, without contrary evidence, can establish the exemption's applicability.

In this case, BioTE established that Rouzier was employed as a faculty member and medical advisor in 2016 and later worked for EvexiPEL in a similar capacity. Rouzier's role involved lecturing on hormone therapy and training doctors and staff on marketing the BioTE system. After transitioning to EvexiPEL in 2018, Rouzier continued to give lectures to promote EvexiPEL’s hormone therapy system. BioTE alleges that Rouzier misappropriated trade secrets to undermine its business by enticing physicians to switch to EvexiPEL. Rouzier contends he is merely a lecturer who works part-time at a medical clinic, but BioTE’s evidence indicates that his lectures were aimed at marketing EvexiPEL's system. Furthermore, Rouzier's previous work at a family practice clinic, which he sold prior to joining BioTE, does not demonstrate that it was his primary occupation or unrelated to his work with EvexiPEL. Ultimately, the communications in question were conducted in the context of his role at EvexiPEL and were intended to promote its system to physicians.

Rouzier's communications were deemed to have occurred while he was primarily engaged in selling goods or services. He contended that BioTE did not demonstrate that his communications were directed towards his actual or potential customers and emphasized his status as an independent contractor, asserting he was not promoting his own practice. Rouzier cited Toth v. Sears Home Improvement Products, Inc. to support his position, where the court ruled that the commercial speech exemption did not apply to an independent contractor discussing a product he did not represent. However, this case was found not applicable to Rouzier’s situation. Unlike Toth, Rouzier’s communications were aimed at promoting the hormone replacement therapy system of the company he worked for as a faculty member and medical advisor. The court clarified that the commercial speech exemption applies not only to personal business endeavors but also when the employer benefits from the communications. The court concluded that BioTE met its burden to establish that the commercial speech exemption was relevant to Rouzier’s communications with medical providers. Therefore, the trial court correctly denied Rouzier’s motion to dismiss, leading to the affirmation of the court's order without needing to address his additional issues.