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Dallas Court of Appeals Rejects Application of TCPA to Trade Secrets Case

Article By Heath Coffman 

Collaborative Imaging, LLC v. Zotec Partners, LLC, No. 05-19-01256-CV, 2020 WL 3118614 (Tex. App.–Dallas  June 12, 2020, no pet. h.) is another example of the courts’ increasing unwillingness to apply the previous version Texas’s anti-SLAPP statute the Texas Citizens Participation Act (TCPA) to cases involving the Texas Uniform Trade Secrets Act (TUTSA).  In Collaborative Imaging, an employee of a healthcare practice management services provider quit his job with that provider and went to work for a company started by the doctors from one of the provider’s clients.  A few months after the employee made the change in employment, the client terminated its contract with the provider.  The provider sued the former employee and his new company, alleging that they disclosed trade secrets relating to billing practices that result in termination of the contract between the provider and client.

In response, the employee and his new company filed a motion to dismiss under the previous version of the TCPA, alleging that the lawsuit implicated their free speech and free association rights.  The trial court rejected this argument, and the Dallas Court of Appeals affirmed.  Regarding the free speech prong of the TCPA, the court rejected the argument that their free speech rights were implicated by communications related to improper billing of government programs and the public; according to the court, that was not a public concern but instead was merely a concern of “commercial competition by which a former employer alleges a former employee disclosed proprietary information to a new employer and used that purloined information to inflict competitive harm on it.”  Accordingly, the free speech prong to the TCPA did not apply.

Regarding the TCPA’s right of association prong, the court again rejected the argument that the communications involved public participation, citing its previous holding that “applying the right of association to private communications related to an alleged conspiracy to misappropriate confidential business information would be ‘illogical’ and lead to an absurd result that would not further the purpose of the TCPA to curb strategic lawsuits against public participation.”

Thus, the TCPA did not apply to this trade secrets case.

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