Ojala Partners, LP v. Brian Driesse and Lavoro Acquisitions. LLC Trinsic Residential Group. LLC and Lavoro Capital Holdings, L.P.

Citation: Not availableDocket: 05-22-00009-CV

Court: Court of Appeals of Texas; February 9, 2023; Texas; State Appellate Court

Original Court Document: View Document

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In the case OJALA PARTNERS, LP v. BRIAN DRIESSE AND LAVORO ACQUISITIONS, LLC, the Texas Court of Appeals affirmed the trial court's denial of Ojala's motion to dismiss under the Texas Citizens Participation Act (TCPA), which is designed to prevent retaliatory lawsuits that aim to silence individuals exercising their rights to free speech and petition. The appeal was accelerated due to the significance of the TCPA, particularly following its 2019 revisions applicable to actions filed after September 1, 2019.

Ojala, engaged in developing affordable public housing, had previously employed Driesse, who entered into an agreement for performance compensation with Ojala. After resigning in 2020, Driesse began working for Lavoro, a company competing in the same field. Ojala accused Driesse of stealing confidential information to compete against it and communicated these allegations to local government entities through Freedom of Information Act requests. Following this, Ojala asserted that Driesse had breached his agreement by this conduct.

Driesse and Lavoro subsequently sued Ojala for tortious interference, business disparagement, defamation, and breach of contract. Ojala's motion to dismiss these claims under the TCPA was denied, leading to the appeal. The court reiterated that under the TCPA, the movant must initially prove that the legal action is based on or in response to their exercise of a protected right, which in this case, the trial court found Ojala failed to establish.

If the movant meets the initial burden under the Texas Citizens Participation Act (TCPA), the burden shifts to the nonmovant to provide clear and specific evidence establishing a prima facie case for each essential element of the claim. Even if the nonmovant succeeds, the court must still dismiss the action if the movant demonstrates entitlement to judgment based on an affirmative defense or other grounds. The standard of review for these determinations is de novo.

Ojala asserts that its TCPA motion should have been granted, presenting four appellate issues: (1) the TCPA applies to the claims; (2) the TCPA exemption for misappropriation of trade secrets does not apply; (3) appellees failed to establish a prima facie case by clear and convincing evidence; and (4) Ojala proved affirmative defenses of substantial truth, justification, and judicial privilege, warranting dismissal.

The court concluded that the TCPA does not apply to the claims against Ojala and affirmed the denial of the motion to dismiss. Following the 2019 TCPA amendments, a claim can be dismissed if it is based on a party's exercise of free speech, petition, or association. Ojala claimed its communications were connected to matters of public concern, specifically asserting that a bidder used stolen confidential information for government contracts related to affordable housing.

Five specific communications were highlighted: a FOIA request for documents related to an affordable housing development; emails expressing concerns about a former employee stealing confidential information; and a letter accusing an individual of breaching duties and competing with Ojala. These communications were deemed to invoke the right of free speech under the TCPA as they pertained to matters of public concern.

Ojala argues that certain communications are significant to the public as they pertain to fair bidding for public affordable housing contracts. However, appellees assert that these communications only concern the dispute between Ojala and former employee Driesse over alleged trade secret misappropriation, which lacks public interest. The court aligns with appellees, noting that these communications are tied to a private dispute, not the public bidding process. The allegations against Driesse and Lavoro are vague and of interest solely to the involved parties. Ojala's cited cases (Nguyen and PNC) are distinguished from the current matter; unlike Nguyen, which involved specific bids related to a governmental entity, the communications here lack any ties to governmental entities or particular projects. Similarly, PNC is relevant due to its focus on a public development project, differing from the private nature of the current dispute. Overall, the court concludes that the communications do not address a matter of public concern.

Appellees claimed that the Project’s Financiers exploited inadequately regulated federal investment programs to facilitate fraudulent activities and misappropriation of public-private funds involving the Centurion Defendants. The PNC court determined that the communications cited by FMG were relevant to public interest due to their connection with a redevelopment project in a TIF district, which involved public funding through federal and state historic tax credits, municipal tax increment financing, and the EB-5 visa program. However, the communications at issue in this case pertained to alleged misconduct by a former employee and did not relate to any specific development project or raise concerns about the project or public fund usage. Consequently, Ojala failed to establish that the legal action was based on a protected right, leading to the trial court's correct denial of Ojala’s TCPA motion to dismiss. The court affirmed the trial court's December 15, 2021 order and remanded for further proceedings. Lastly, it ordered the appellees to recover their appeal costs from Ojala Partners, LP.