In 2018 parties entered into a contract for the joint provision of investment advisory services. They soon fell out and in April 2020 signed a confidential settlement agreement to get out of the mess. The agreement contained a mutual confidentiality and non-disparagement clause. Subsequently, one of the parties, Matthew Fuller, applied for a country club membership. Fuller later found out that parties Craig and Michelle Mausz were talking about him and his application to other club members to the detriment of his reputation. His membership application was denied.
These are the facts of Matthew Fuller and Fuller Wealth Management, LLC v. Craig Hausz, Michelle Hausz, CMH Advisors, PLLC, and CMH Wealth Management, LLC (No. 05-22-00893-CV; filed August 10, 2023). Fuller sued the Hauszs and CMH for breach of the settlement agreement and defamation. Defendants answered and counterclaimed for attorney’s fees. They likewise filed a motion to dismiss under the Texas Citizens Participation Act. After a hearing, the trial court granted the TCPA motion, dismissed plaintiffs’ claims with prejudice, and awarded defendants’ their attorney’s fees. Plaintiffs appealed.
The Dallas Court of Appeals reversed and remanded. The question was whether “the trial judge erred by granting the [TCPA] motion because (1) both of those rights require the movant to have said or done something involving a matter of public concern and (2) none of [defendants’] acts at issue involve a matter of public concern,” as required by § 27.001, CPRC. The court thus looked to the jurisprudence around the definition of “matter of public concern” in both its pre- and post-2019 forms. Prior to the 2019 amendments, SCOTX “read the old definition expansively, holding that a communication related to a matter of public concern even if it had only a tangential relationship to a listed topic” (citations omitted). But as we reported yesterday, SCOTX “retreated from this expansive reading” in McLane Champions, LLC v. Houston Baseball Partners LLC (no. 21-0641).
Consequently, the court “concluded that the legislature intended to narrow the [definition of matter of public concern’s] scope with the 2019 amendments” (citations omitted). Further, the court went on, it “intended for the courts to construe the new definition consistently with First Amendment Jurisprudence, under which communications are matter[s] of public concern when they can be fairly considered as relating to any matter of political, social, or other concern to the community or when [they address] a subject of legitimate news interest; that is, a subject of general interest and of value and concern to the public (citing Vaughn-Riley v. Patterson, No. 05-20-00236-CV, 2020 WL 7053651, at *3 (Tex. App.—Dallas Dec. 2, 2020, no pet.) (mem. op.); Snyder v. Phelps, 562 U.S. 443, 453 (2011)).
Noting that the legislature “repudiated” the “tangential-relationship test” of prior TCPA authority and that “private disputes that affect only the fortunes of the litigants are not matters of public concern,” the court determined that the communications concerning the country club membership “involved nothing more than private disputes affecting no one but the disputants.” They thus did not involve a matter of public concern. As to the communications concerning the business dispute, defendants argued that plaintiffs’ allegations in their petition, as well as a cease-and-desist letter they sent to defendants, rose to the level of “interest to the community” because they harmed defendants’ reputation and damaged their ability to sign up clients. The court did not go for this argument, reasoning that “even if the business disputes and disagreements revealed in the communications put appellants in a negative light, there is nothing to suggest that the communication would affect anyone but [their] clients and potential clients” (citations omitted). Specifically, the cease-and-desist letter, which alleged that defendants’ statements had negatively affected plaintiffs’ personal and business interests with “longtime clients . . . who are closely associated with members of the Club” only went to plaintiffs’ relationships with people who “already had a relationship” with plaintiffs, not people in the community at large, as required by the statute. The same went for the defendants’ statements that plaintiff Fuller had been “blackballed” from the country club: not “a matter of interest or concern to the community or the public.”
The court likewise rejected defendants’ argument based on the right of association, which urged the court to find that their “activities related to the country club’s membership-application process ‘[were] a matter of public concern regarding the community well-being of the club’s members and their immediate families” and thus involved the “common interest” of the club members. The court disagreed that “the club members’ common interest in having only fit and worthy people join the club” neither rose to the level of “a subject of concern to the public” or constituted “a matter of political, social, or other interest to the community” under § 27.001(7)(b), CPRC. Indeed, the “catch-all phrase ‘other interest,’” is limited in meaning to “the same kind or class of categories expressly mentioned, i.e. political and social interest” (citation omitted) and does not extend beyond those boundaries. The court thus concluded that the trial court erred in granting defendants’ TCPA motion to dismiss and awarding attorney’s fees.
In our view, this decision is consistent with McLane and the 2019 TCPA amendments. While we will undoubtedly see continuing attempts to expand the scope of “matter of public concern,” it appears to us that the jurisprudence is moving in the other direction.
