The Business Court has granted Brown & Root’s motion for summary judgment based on claim preclusion but denied that of Plaintiffs’ former employee, who was a nonparty in a prior suit in Chambers County district court.
CAM Industrial Solutions LLC; CAM Plant Services LLC v. Brown & Root Industrial Services, LLC; Sidney Daley (2026 Tex. Bus. 56; August 10, 2026) arose from a misappropriation of trade secrets claim filed by a maintenance contractor at Exxon’s Baytown Complex. When Exxon decided in 2023 to switch the business to Brown & Root, CAM Industrial Solutions cried foul. It alleged that Brown & Root got the business by recruiting its personnel and misusing its confidential information, specifically CAM’s proprietary direct-to-pay labor rate sheets, allegedly photographed by Daley, its former Baytown site manager, using his wife’s cell phone. CAM alleges that Brown & Root paid Daley $100,000 and then hired him. In 2024, CAM sued Brown & Root in Chambers County district court. At trial CAM presented evidence of the rate-sheet scheme, and requested the court to submit jury questions concerning Daley’s alleged breach of fiduciary duty breach and Brown & Root’s alleged participation. Since CAM didn’t join Daley as a party, the court declined to do so, and the jury rejected CAM’s trade secrets claim. The district court entered a final judgment in favor of Brown & Root.
The following day, CAM sued again in the Business Court, this time bringing Daley into the mix. Defendants filed motions for summary judgment on the basis of claim preclusion. In an opinion by Judge Stagner, the court granted Brown & Root’s motion but not Daley’s. As to Brown & Root’s MSJ, the court found that B&R established the three elements of claim preclusion, that is (1) a prior final judgment on the merits by a court of competent jurisdiction, (2) identify of the same parties or those in privity with them, and (3) a second action based on claims raised or that could have been raised in the first action. CAM attacked the first element, arguing that it wasn’t a “prior judgment” because CAM filed in the Business Court one day before the judgment was signed. (Seriously, that was the argument.) After all, it’s the first judgment that has preclusive effect. Here the Chambers County litigation reached a judgment first. Finally, there was no question that the second and third elements of the test had been satisfied.
Turning to Daley’s MSJ, the court examined whether Daley established privity under the second prong of the test. That issue came down to “whether the relationship between the party and the nonparty was sufficiently close that the party represented the same legal right.” To show that, Daley had to show that, as a nonparty in the first action, (1) he controlled the first action, (ii) his interest was fully represented by another party, or (iii) he was a successor-in-interest to a party. Daley couldn’t show any of these. He neither “directed the Chambers County litigation, selected counsel, funded the defense, determined litigation strategy, or otherwise possessed a right to control the case.” And it goes without saying that Daley couldn’t show that he was successor-in-interest to any Chambers County defendant, much less Brown & Root.
Daley mounted a co-conspirator argument, but Texas law doesn’t “create a categorical rule that every person whose conduct related to an alleged conspiracy is in privity with the named defendants.” But Cam never pleaded Daley as a conspirator or that any Chambers County defendant undertook to represent his personal interests. Additionally, the fact that Brown & Root allegedly paid Daley for the information didn’t make it “the representative of Daley’s interest in whether he breached his confidentiality agreement or fiduciary duties, nor did it make Daley a successor to any legal interests held by Brown & Root.” Instead, the issue in the Business Court litigation is whether Daley’s alleged disclosure violated his contractual and fiduciary duties. The jury in Chambers County didn’t decide these issues or consider Daley’s conduct in any way (not to mention that the trial court refused to give an instruction). Daley’s MSJ was thus denied. CAM’s claims against him thus remain pending.
