In yet another case showing a patent abuse of the Texas Citizens Participation Act (Ch. 27, TCPA), the Dallas Court of Appeals has ruled that a trial court did not abuse its discretion by awarding attorney’s fees to a defendant forced to defend a frivolous TCPA motion to dismiss. Michael A. Ruff v. Suzann Ruff (No. 05-21-00157-CV) arose from a lawsuit filed in probate court by Suzann against her son Mike for mismanagement and conversion of her deceased husband’s considerable assets. Suzann secured an arbitration award for $49 million, which was confirmed by the probate court and affirmed by the Dallas Court of Appeals.
Subsequently, in 2017 Suzann filed a second suit against Mike for misappropriating $2 million from one of the family businesses to buy his wife a house. Mike filed a TCPA motion to dismiss but not until December 2020, a few weeks after Suzann filed her seventh amended petition in the case. Suzann moved to dismiss the TCPA motion because it was not timely filed. The trial court held a hearing on the TCPA motion to dismiss in January 2021, but two weeks later Mike filed a motion to recuse the trial judge. The judge voluntarily recused herself, at which point the regional presiding judge transferred the case to a new judge and extended all deadlines under SCOTX’s emergency order. This extension meant that the deadline for the trial court to rule on the TCPA motion to dismiss shifted to April 1, 2021. The new judge determined that she would rule on the motion by submission without another hearing, to which the parties agreed. However, when the new judge informed the parties that she would not contact the former judge to obtain a transcript of the hearing (for reasons contained in the recusal motion), Mike changed his mind and asked for a hearing. Ultimately, the hearing was not held and, in April 1, the new judge signed an order denying Mike’s TCPA motion to dismiss, finding the motion was frivolous and filed solely for purposes of delay, and awarding trial and appellate fees to Suzann. Mike appealed.
The tortured procedural history of the case (partly on account of the pandemic) occupied much of the court of appeals’ opinion. Mike challenged the authority of the regional presiding judge to transfer the case and extend the deadlines, which the court roundly rejected. Mike further claimed that the notice of appeal he filed on March 9, 2021 triggered an automatic stay that stripped the new judge of jurisdiction to rule on his TCPA motion. The court of appeals disagreed, holding that the extension of the deadline to April 1 was proper and that Mike’s premature notice of appeal did not take effect until April 1, the date of the trial court’s order that was the subject of the appeal. Mike then asserted that he was denied due process of law because the new judge did not hold a second hearing on his motion to dismiss. Again, the court of appeals demurred, holding that the TCPA provides for only one hearing, not a second one if the trial judge recuses and the case is reassigned. Moreover, SCOTX’s emergency rules allowed the extension of deadlines but did not require them to hold hearings “where there was no preexisting right to a hearing.”
After disposing of Mike’s various and sundry procedural arguments, the court of appeals reached the TCPA issue. Mike alleged that Suzann’s second lawsuit implicated the “health and safety” of his family and related to his speech, petition, and association rights (this case was governed by the pre-2019 TCPA). The court of appeals, however, agreed with Suzann that Mike’s motion to dismiss was not timely filed. Suzann filed the suit on December 17, 2017, but Mike didn’t file his TCPA motion until December 2020. Mike argued that the motion was timely because it was filed within 60 days of Suzann’s seventh amended petition dated October 30, 2020. But the court of appeals found that this petition did not meet SCOTX’s test for restarting the 60-day clock on TCPA motions to dismiss because it did not (1) add a new party, (2) allege new essential facts to support previously asserted claims, or (3) assert new legal claims or theories involving different elements than the claims or theories previously asserted. The court of appeals concluded that the trial court did not err when it dismissed Mike’s motion as untimely.
Finally, Mike argued that the trial court erred by finding his TCPA motion to dismiss frivolous and filed solely for purposes of delay and that Suzann failed to prove her entitlement to attorney’s fees. Under an abuse of discretion standard of review, the court of appeals affirmed the trial court’s finding that the motion was frivolous as lacking “any basis in law or fact and any legal basis or legal merit.” Given that the motion was not only untimely but filed more than three years after the suit was filed, the “trial court could conclude that Mike’s attempt to explain his tardy filing as being based on new allegations in the seventh amended petition was in bad faith and had no legal basis.” Applying the lodestar method for determining the reasonableness and necessity of attorney’s fees, the court of appeal upheld the trial court’s award of attorney’s fees for services in the trial court but remanded to the trial court for a determination of appellate fees.
The TCPA had no business in this case. Even had Mike timely filed his motion to dismiss, it seems more than likely that the court would have denied it (although whether the motion would have been found frivolous in that event would have been a close question, especially under the broad coverage of the old law). Again, this case illustrates both the frustrations of trial and appellate judges having to deal with rogue TCPA motions and the basis for legislative intervention in 2019. As the courts clear out the old law cases like this one, we have good reasons to hope that the new law will keep much of this nonsense from happening. If it doesn’t, the Legislature will no doubt be asked to intervene again.