Opinion issued June 25, 2013.

In The

Court of Appeals 

For The 

First District of Texas 

————————————

NO. 01-11-00201-CV

———————————

ROBERT WRITT, Appellant

V.

SHELL OIL COMPANY AND SHELL INTERNATIONAL, E&P, INC., 

Appellees

On Appeal from the 189th District Court

Harris County, Texas

Trial Court Cause No. 2009-65221

DISSENTING OPINION 

For more than one hundred years, Texas defamation law has artfully

balanced two fundamental interests: a citizen’s right to his good name and a 

citizen’s right to free speech. Communications made in the context of judicial
2

proceedings invoke two additional and equally important interests: a citizen’s right 

to petition for redress and the administration of justice. When the judicial 

proceedings are criminal in nature, a citizen’s interests in the deterrence and 

prosecution of crime are added to the balance. And when the government

investigates a potential crime and calls on a citizen to respond with information, 

society’s interest in encouraging cooperation with the investigation comes into 

play. In the defamation equilibrium, we safeguard these fundamental interests 

through privileges. 

The Court’s new opinion initially focuses on the public policy interests that 

it concludes require denying Shell an absolute privilege for its statements made in 

response to a Department of Justice inquiry on possible violations of the Foreign 

Corrupt Practices Act. According to the Court, recognition of an absolute privilege 

“would have the very dangerous effect of actually discouraging parties from being 

truthful with law-enforcement agencies and instead encourage them to deflect 

blame to others without fear of consequence.” I respectfully disagree.

For criminal prosecutions, our jurisprudence has reached a careful accord—

we afford a qualified privilege to statements made by a private citizen who 

approaches a governmental authority with criminal allegations, but we afford an 

absolute privilege to communications made to prosecuting governmental 

authorities during or in contemplation of criminal proceedings. When a citizen, 
3

corporate or otherwise, is approached by a law-enforcement agency for 

cooperation in an ongoing investigation of a contemplated criminal prosecution, 

the administration of justice requires absolute privilege, which encourages the 

citizen’s full and unreserved cooperation in the agency’s information-gathering 

efforts, unhampered by fear of retaliatory lawsuits. Shell’s cooperation with the 

DOJ falls into this category, and the trial court correctly afforded it absolute 

privilege. In reaching a contrary holding, the Court gives insufficient weight to

both the benefits of an absolute privilege and the costs of a conditional privilege 

that depends on a speaker’s subjective good faith. The Court’s holding inevitably 

will create a fact issue in many cases. And a conditional privilege frustrates the 

kind of frankness, cooperation, and self-reporting that is vital to the DOJ’s 

prevention and prosecution of corporate misconduct in international business 

dealings under the FCPA. I believe the balance of the benefits and costs of an 

absolute privilege for statements made by a potential target of a DOJ investigation,

as well as the detriments of requiring jury trials in many of these cases, warrants an

absolute privilege. I therefore respectfully dissent.

Hurlbut is not controlling

Before turning to the policy issues, I first will address the only Texas 

Supreme Court opinion that considers the scope of a privilege for a claimed 

defamatory statement that is not part of a judicial proceeding: Hurlbut v. Gulf 
4

Atlantic Life Insurance Co., 749 S.W.2d 762 (Tex. 1987). I disagree with the Court 

that Shell is only entitled to a qualified privilege under Hurlbut. 

In that case, Gulf Atlantic Insurance Company proposed that Hurlbut “form 

a partnership to serve as the administrator of a proposed health insurance trust 

which would sell and service group health insurance policies underwritten by Gulf 

Atlantic” and then later instructed Hurlbut to start selling policies under the trust 

agreement. Id. at 764. A potential client who became concerned when Hurlbut 

could not produce a copy of the master policy from Gulf Atlantic contacted the 

Attorney General’s office to complain. Id. at 764. Gulf Atlantic suggested a 

meeting with Hurlbut to resolve the matter. Id. When Hurlbut arrived for the 

meeting, he was surprised to be met by an assistant attorney general “assigned to 

investigate the group health insurance program” sold by Hurlbut. Id. During the 

meeting, Gulf Atlantic’s president made a defamatory statement about Hurlbut. Id.

The Texas Supreme Court refused to apply an absolute privilege. Id. at 768. The 

Court explained that the absolute privilege attaches only to a “select number of 

situations which involve the administration of the functions of the branches of 

government.” Id. And the Court held that “the occasion of Gulf Atlantic’s 

communication to the assistant attorney general in this case is best analogized to 

the conditional privilege described in section 598 of the Restatement.” Id.
5

Hurlbut is distinguishable because it is an instigation case—Gulf Atlantic 

was not self-reporting in response to a criminal probe. Hurlbut was a salesperson, 

not a Gulf Atlantic employee, who sold insurance policies under a trust agreement

with Gulf Atlantic. Hurlbut had formed a separate partnership (at Gulf Atlantic’s 

behest) before the incident arose. Thus, Gulf Atlantic reported to evade potential 

criminal liability by implicating another company (Hurlbut and his partnership), 

not to confess guilt. Thus, unlike this case, Hurlbut involved the instigation of 

prosecution against someone else, not a confession of culpability. In conclusion 

Hurlbut does not answer whether cooperation with an FCPA investigation by the 

DOJ implicates one of the “select number of situations which involve the 

administration of the functions of the branches of government” and therefore 

requires the recognition of an absolute privilege. Id. at 768. It does, however, 

suggest that our focus should be on public policy considerations, i.e., the 

administration of government.

Public policy favors granting an absolute privilege

The rule granting absolute privilege is “one of public policy” so both the 

Court and I begin our analysis here. Reagan v. Guardian Life Ins. Co., 166 S.W.2d 

909, 913 (Tex. 1942). 
6

A. The policy reasons that statements made in contemplation of judicial 

proceedings are absolutely privileged

Statements made “during the course of judicial proceedings” are absolutely 

privileged. Bird v. W.C.W., 868 S.W.2d 767, 771 (Tex. 1994). This privilege 

protects parties not only from liability “but also from the danger of even an 

unsuccessful civil action.” RESTATEMENT (SECOND) OF TORTS ch. 25, topic 2, tit. B, 

intro. note (1977). 

Absolute privileges are recognized to protect public policy interests deemed 

sufficiently important to trump the rights of individuals who would otherwise have 

a claim against a person. See Reagan, 166 S.W.2d at 913 (absolute privilege is 

founded on public policy “that the good it accomplishes in protecting the rights of 

the general public outweighs any wrong or injury which may result to a particular 

individual”); Zarate v. Cortinas, 553 S.W.2d 652, 654 (Tex. Civ. App.―Corpus 

Christi 1977, no writ) (absolute privilege applies to conduct that otherwise would 

be actionable “because the defendant is acting in furtherance of some interest of 

social importance which is entitled to protection even at the expense of 

uncompensated harm to the plaintiff’s reputation”). An absolute privilege for

statements made in judicial proceedings is “based on the policy of protecting the 

judicial process,” Briscoe v. LaHue, 460 U.S. 325, 334, 103 S. Ct. 1108, 1115

(1983) (quoting Imbler v. Pachtman, 424 U.S. 409, 439, 96 S. Ct. 984, 999 (1976) 

(White, J., concurring)), particularly from “intimidation and self-censorship,” id. at
7

341–42, 103 S. Ct. at 1119. See also RESTATEMENT (SECOND) OF TORTS ch. 25, 

topic 2, tit. B, intro. note (1977) (absolute privileges exist to protect persons in 

limited circumstances when law wants individuals to “be as free as possible from 

fear that their actions in that position might have an adverse effect upon their own 

personal interests.”). “The administration of justice requires full disclosure from 

witnesses, unhampered by fear of retaliatory suits for defamation.” James v. 

Brown, 637 S.W.2d 914, 917 (Tex. 1982). And because the administration of 

justice is a process that encompasses more than simply judicial proceedings, the 

absolute privilege reaches statements made preliminary to a proposed judicial 

proceeding, as well as informal complaints made to a prosecuting attorney or other 

proper officer preliminary to a proposed criminal prosecution. RESTATEMENT 

(SECOND) OF TORTS § 587. An individual speaker who makes a defamatory 

statement “may not deserve the privilege, nevertheless, the law grants the privilege 

to protect the integrity of the process.” Attaya v. Shoukfeh, 962 S.W.2d 237, 239 

(Tex. App.—Amarillo 1998, pet. denied); accord Hernandez v. Hayes, 931 S.W.2d 

648, 654 (Tex. App.—San Antonio 1996, writ denied) (“The absolute privilege is 

as much a protector of the process as it is a protector of those who avail themselves 

of the process.”). 
8

B. Absolute privilege encourages cooperation, which aids enforcement 

efforts

Absent an absolute privilege, the threat of liability may deter a company 

from fully cooperating in an FCPA investigation. When a corporation accepts 

some fault for its conduct, it is necessarily attributing the fault to individuals who 

are its agents, officers, or employees. Thus, a corporation’s frank acceptance of its 

fault, by its very nature, will often result in some individuals within the company 

disagreeing with that assessment. If the identified individuals and entities may sue 

for defamation, a company will have a disincentive to cooperate and accept 

responsibility. If absolute privilege is not available, a cooperating party runs the 

risk of defamation actions by anyone identified as having involvement in a 

potentially prohibited transaction. This risk creates a disincentive for companies to 

conduct their own investigations, to make frank assessments of fault, and to 

communicate findings to the DOJ. 

Without corporate cooperation, more of the burden of the investigation shifts

to the government, requiring the DOJ to piece together knowledge and 

understanding that the company already has from its involvement in the 

transaction. The DOJ may have to use formal judicial processes to obtain 

documents and testimony and then invest additional effort to review the 

information and ascertain its relevancy, when the corporation easily could identify

and assimilate the key documents and important transaction details. And some 
9

information is difficult to obtain without an inside perspective—corporations 

fearful of defamation liability may be reluctant even to identify those responsible 

for certain decisions, and the decision-maker on paper is not always the decisionmaker in practice. Thus, creating disincentives to full disclosure imposes 

significantly greater costs on the DOJ and hampers its efforts to investigate FCPA 

violations. 

The detection of foreign corrupt practices, cooperation of persons engaged in 

such conduct, and deterrence of future violations are all enhanced by creating full 

incentives for disclosure of information to the DOJ. The extraterritorial aspects of 

FCPA violations make them costly and time-consuming to investigate. Delayed 

responses, language barriers, and lack of jurisdiction may hinder the FCPA’s

enforcement. Cooperation from individuals and companies willing to undertake 

internal investigations or to assist the DOJ in its efforts can help overcome these 

obstacles. Recognition of an absolute privilege, therefore, promotes the policy 

goals underlying the FCPA by aiding law enforcement through increased access to 

information and efficiency. 

To deny absolute privilege here would be to chill the free flow of 

information and impair the DOJ’s ability to conduct its investigations and enforce 

the FCPA. See 5-State Helicopters,146 S.W.3d 254, 259 (Tex. App.—Fort Worth 

2004, pet. denied) (stating that adopting “a rule that private citizens’
10

communications to a quasi-judicial body about a matter that the entity was 

authorized to investigate and resolve would not be privileged unless and until the 

proceeding reached the administrative hearing stage . . . would have a chilling 

effect on the free flow of information and deter rather than aid the decision-making 

body’s efforts to obtain necessary information.”); Attaya, 962 S.W.2d at 239 

(stating that absolute privilege “is intended to protect the integrity of the process 

itself and to insure that the decision-making body gets the information it needs.”). 

Without incentives to cooperate, enforcement of the FCPA would be curtailed. 

Robert W. Tarun, The Foreign Corrupt Practices Act Handbook: A Practical 

Guide for Multinational General Counsel, Transactional Lawyers and White 

Collar Criminal Practitioners, 190 (2nd ed. 2012) (stating that “DOJ and SEC do 

need companies to voluntarily disclose because their resources are limited.”); see 

also Examining Enforcement of the Foreign Corrupt Practices Act: Hearing 

Before the Subcomm. on Crime and Drugs of the S. Comm. on the Judiciary, 111th 

Cong. 8 (Nov. 30, 2010) (statement of Greg Andres, Acting Deputy Assistant Att’y 

Gen., Crim. Div., Dep’t of Justice) (stating that, in many cases, DOJ relies on “the 

self-disclosure and cooperation of corporations” and that self-disclosure is an 

important factor in cases that get resolved). 

The process is thus designed to promote cooperation through incentives such 

as better settlement prospects and more lenience in the Federal Sentencing 
11

Guidelines, as discussed below. “[The companies] make a decision to disclose and 

in return for their disclosing and their investigating, in large part, their own 

criminal conduct, they get meaningful credit with the department and that credit 

goes into the decision whether to file an information or charge the company, 

whether to enter a deferred prosecution or non-prosecution agreement.” See Philip 

Segal, Coming Clean on Dirty Dealing: Time for A Fact-Based Evaluation of the 

Foreign Corrupt Practices Act, 18 FLA. J. INT’L L. 169, 177 n.28 (2006). These 

incentives are less effective when offset or overshadowed by the potential for 

defamation litigation and liability. 

C. Absolute privilege recognizes the precarious position of corporations 

involved in questioned transactions 

Absolute privilege also recognizes that companies feel compelled to provide 

information, often against their own interest and those of their employees, to avoid 

larger penalties. A company like Shell is, in the face of a DOJ inquiry, in a 

quandary: it can provide inculpatory statements regarding actions taken on its 

behalf by its employees, recognizing that it is exposed to a defamation claim. Or it 

can face criminal prosecution or penalization for a failure to comply and cooperate 

adequately with the DOJ’s investigation. See, e.g., U.S. v Kay, 513 F.3d 432, 454–

55 (5th Cir. 2007) (affirming FCPA and obstruction of justice convictions against 

corporate president who failed to disclose documents subpoenaed during SEC 

investigation and failed to disclose misconduct in testimony given during 
12

investigation).1 The qualified immunity adopted by the Court protects Shell for all 

but those statements made with actual malice. But the reason that absolute 

privilege extends even to malicious untruths is not because such statements are 

rendered less deserving of protection in the context of a judicial or quasi-judicial 

proceeding; it is because balancing of the rights at issue in such proceedings 

demands immunity—i.e., protection against “the danger of even an unsuccessful 

civil action”—rather than the opportunity to litigate state of mind. See 

RESTATEMENT (SECOND) OF TORTS ch. 25, topic 2, tit. B, intro. note (1977).

Encouraging witnesses to share requested information about possible criminal 

violations with a trained government investigator whose job is to separate fact 

from fiction should be encouraged—even at the cost of some defamatory 

statements going without remedy—when a witness does not initiate the 

investigation and faces prosecution for any false statements. See Clemens v. 

McNamee, 608 F. Supp. 2d 811, 816–17 (S.D. Tex. 2009), aff’d, 615 F.3d 374 (5th 

Cir. 2010). Similarly, Shell’s cooperation with the DOJ was essential to lowering 

its potential liability in fines—either through agreed disposition with the DOJ or in 

post-trial sentencing—and withholding information could have subjected Shell to 

federal prosecution. See 18 U.S.C. § 1505 (criminalizing, in relevant part, anyone 

 1 Kay, a criminal case, does not discuss whether an absolute privilege applies to 

statements made during the SEC investigation.
13

who, “with the intent to avoid, evade, prevent, or obstruct compliance . . . with any 

civil investigative demand . . . , willfully withholds . . . any documentary material, 

answers to written interrogatories, or oral testament, which is the subject of such 

demand”); Kay, 513 F.3d at 455 (affirming obstruction of justice conviction for 

withholding documents and making false statements during FCPA investigation).

In the context of an ongoing government investigation, there are enormous risks to 

maliciously implicating an innocent person in an FCPA violation. The potential 

consequences to a company like Shell are themselves adequate to protect the 

interests of Writt and similarly situated employees from malicious defamation.

D. Sound public policy distinguishes between solicited and unsolicited 

communications2

 2 The Restatement goes further, recognizing an absolute privilege for informal 

complaints made to a prosecuting attorney or similar governmental authority. 

RESTATEMENT (SECOND) OF TORTS, § 587, cmt. b (providing that absolute 

privilege applies to “information given and informal complaints made to a 

prosecuting attorney or other proper officer preliminary to a proposed criminal 

prosecution whether or not the information is followed by a formal complaint or 

affidavit”); id. § 598 cmt. e (“Formal or informal complaints to a prosecuting 

attorney or other law enforcement officer concerning violations of the criminal 

law are absolutely privileged under the rule stated in § 587”). A number of states 

have adopted this approach. See e.g., Correllas v. Viveiros, 572 N.E.2d 7, 11 

(Mass. 1991) (statements made to police or prosecutors before trial are absolutely 

privileged if they are made in context of proposed judicial proceeding); 

McGranahan v. Dahar, 408 A.2d 121, 124 (N.H. 1979) (applying absolutely 

privilege to complaints and statements to prosecuting authority during pre-arrest 

investigation because they constitute part of initial steps in judicial proceeding); 

Bergman v. Hupy, 221 N.W.2d 898, 901−02 (Wis. 1974) (applying absolute 

privilege to statements to assistant district attorney while seeking issuance of 

criminal complaint); Block v. Sacramento Clinical Labs, Inc., 182 Cal. Rptr. 438, 

442−43 (Cal. Ct. App. 1982) (holding that report prepared “upon the request of the 

office of the district attorney in furtherance of its investigation whether there was 
14

When a criminal investigation is ongoing, the governmental authority—a

neutral and objective investigator—has determined that there is some threshold 

level of evidence or other grounds for suspicion to justify an investigation on the 

subject matter. In such a circumstance, the allegedly defamatory statements are not 

the initial cause of the governmental authority’s decision to investigate. This 

lessens, though it does not eliminate, the risk that the speaker’s defamatory 

statements, alone, could spur government action against the defamed party. And 

when the speaker is approached as a potential target of the investigation, as Shell 

was here, it may also lessen the efficacy of a speaker’s defamatory statements—a 

governmental authority may treat finger-pointing by suspected lawbreakers with 

heightened skepticism. Thus, the governmental authority’s role as adjudicator of 

truth and fiction is implicated.

In light of these policies, numerous Texas cases have distinguished between 

statements that are made pursuant to an ongoing or already contemplated 

proceeding (which fall within the privilege) and statements that caused or were 

intended to cause the initiation of a proceeding (which do not fall within the 

privilege). Although both statements are “preliminary to” a judicial proceeding in a 

 

probable cause to initiate criminal charges” was absolutely privileged because 

there are strong policy reasons to “assure free and open channels of 

communication between citizens and public agencies and authorities charged with 

the responsibility of investigating wrongdoing”). It is unnecessary to decide 

whether to apply the Restatement prosecutorial privilege here, but many of the 

reasons for that privilege do apply here, as discussed herein. 
15

temporal sense, protection is only provided to the first because it does not cause the 

criminal investigation or proceeding. Compare San Antonio Credit Union v. 

O’Connor, 115 S.W.3d 82, 99 (Tex. App.—San Antonio 2003, pet. denied) 

(holding that criminal complaint was not absolutely privileged because “no judicial 

proceedings had been proposed” when complaint was filed); Clark v. Jenkins, 248 

S.W.3d 418, 433 (Tex. App.—Amarillo 2008, pet. denied) (holding that absolute 

privilege was not available when statements were “preliminary in nature—i.e., 

designed to launch an investigation that might lead to legal action”); Smith v. 

Cattier, No. 05-99-01643-CV, 2000 WL 893243, at *4 (Tex. App.—Dallas July 6, 

2000, no pet.) (not designated for publication) (noting that witness’s failure to 

negate that his communication with law enforcement authorities had “initiated, 

procured, and caused” criminal investigation into plaintiff’s actions); Zarate, 553 

S.W.2d at 655–56 (holding that complaints filed with sheriff’s office to initiate 

criminal investigation into financial improprieties were not entitled to absolute 

privilege); Vista Chevrolet, Inc. v. Barron, 698 S.W.2d 435, 438 (Tex. App.—

Corpus Christi 1985, no writ) (declining to apply absolute privilege to criminal 

theft complaint made to law enforcement authorities), with Perdue, Brackett, 

Flores, Utt & Burns v. Linebarger, Goggan, Blair, Sampson & Meeks, L.L.P., 291 

S.W.3d 448, 453 (Tex. App.—Fort Worth 2009, no pet.) (applying absolute 

privilege to law firm’s statements about competing law firm in memo to city 
16

council before council meeting regarding extension of competing firm’s contract 

with city); 5-State Helicopters, 146 S.W.3d at 259 (applying absolute privilege to 

helicopter company’s letters to FAA complaining of inspector’s actions in course 

of FAA inspection and investigation); Shanks v. AlliedSignal, Inc., 169 F.3d 988,

994 (5th Cir. 1999) (applying absolute privilege statements made as part of 

“ongoing” National Transportation and Safety Board accident investigation); 

Clemens, 608 F.Supp.2d at 823–24 (applying absolute privilege to solicited, 

involuntary statements made to federal prosecutors and investigators and to

commission formed by Major League Baseball “as part of an ongoing 

proceeding”).

These distinctions—between who initiated the contact between the speaker 

and the governmental authority and whether the governmental authority already 

had cause to investigate—are also important because, among other reasons, a 

private citizen generally has no legal obligation to investigate, ascertain the truth 

of, and report on the criminal activities of others. Cf. TEX. PEN. CODE ANN.

§ 38.17−.171 (requiring person to report only two specific categories of offenses 

under certain circumstances). But when a governmental authority has 

independently commenced investigatory proceedings and reached out to a private 

citizen for information, the citizen may be subject to penalization for interfering or 

failing to cooperate. See, e.g., TEX. PEN. CODE ANN. § 37.09(a)(1), (c) (West Supp. 
17

2011) (prohibiting person who is aware of investigation or official proceeding from 

concealing “any record, document, or thing with intent to impair its verity, 

legibility, or availability as evidence in the investigation or official proceeding” 

and “making such conduct punishable” as third degree felony or higher); 18 U.S.C. 

§ 1505 (prohibiting obstruction of proceedings before federal departments, 

agencies and committees, with penalties including fine and imprisonment). And, 

with respect to FCPA investigations and prosecutions, the DOJ has informed 

corporate citizens like Shell that a “corporation’s timely and voluntary disclosure 

of wrongdoing and its willingness to cooperate in the investigation of its agents” is 

one of the factors the DOJ considers when “conducting an investigation, 

determining whether to bring charges, and negotiating plea agreements.” See 

Deputy Attorney General’s Federal Prosecution of Corporations (June 16, 1999), 

available at www.justice.gov/criminal/fraud/documents/reports/1999/chargingcorps.PDF, last accessed on June 20, 2013. Moreover, if the matter is not resolved 

with the DOJ and proceeds to trial, the Federal Sentencing Guidelines dictate that 

the timing and nature of a corporation’s cooperation and self-reporting to the DOJ 

or other appropriate governmental authority be taken into account in setting fines. 

See U.S.S.G. § 8C2.5.

It is therefore not surprising that several federal courts have concluded that 

statements made as part of an ongoing criminal investigation are entitled to an 
18

absolute privilege under Texas law. See Clemens, 608 F. Supp. 2d at 824

(“[Assistant U.S. Attorney] Parrella’s investigation, much like the NTSB’s 

investigation at issue in Shanks, was an ongoing proceeding.”); Shanks, 169 F.3d at 

993–94 (holding that, under Texas law, “NTSB accident investigations are quasijudicial proceedings, from which it would follow that any communications made 

during such investigations are absolutely immune from suit”). In the same vein, the 

Texas Supreme Court applied an absolute privilege in a defamation case based on a 

letter written to a grand jury foreperson charging a violation of the criminal law in 

Hott v. Yarbrough, 245 S.W. 676, 678−79 (Tex. 1922).

E. Conclusion on policy analysis

Whether to recognize an absolute privilege or qualified privilege is based 

upon public policy considerations that “treat[] the ends to be gained by permitting 

defamatory statements as outweighing the harm that may be done to the reputation 

of others.” RESTATEMENT (SECOND) OF TORTS ch. 25, title B, introductory note 

(1977); cf. Harlow v. Fitzgerald, 457 U.S. 800, 813, 102 S. Ct. 2727, 2736 (1982) 

(stating that “[t]he resolution of immunity questions inherently requires a balance 

between the evils inevitable in any available alternative”).The balancing of these 

interests is difficult and reasonable minds can disagree about the weight to be 

given to each interest and the impact of recognizing—or refusing to recognize—

privileges for defamatory statements. 
19

On the one hand, there are societal and individual costs associated with

giving Shell an absolute privilege—Writt will lose his right to file a lawsuit 

accusing Shell of defamation. Shell has an incentive to blame lower level 

employees, who are less capable of defending themselves. So its statement has 

characteristics of both instigation and self-reporting in response to a formal request 

for disclosure by a prosecuting authority. As a potential target, Shell’s 

investigation of its own employees may not be entirely independent or objective.

On the other hand, balanced against the individual’s interest in protecting his

reputation are a number of important societal factors implicated by an FCPA 

investigation. Statements made in response to a request by the DOJ as part of an

FCPA investigation are analogous to statements solicited by prosecutors as part of 

their investigation. Courts have made a policy decision that complaints to 

prosecutors are entitled to an absolute privilege even when they are false and 

malicious. Such protection encourages reporting. Moreover, the prosecutors 

themselves, as part of their investigation, examine the speaker’s motivations. And 

if the prosecutor determines that statement is false and malicious, the harm created 

by the statement is limited to a particular audience and is minimized. 

A statement that contains a malicious misstatement may materially advance 

the prosecutor’s investigation by revealing an effort to deflect blame and thus 

implicating the speaker’s own culpability and leading to the discovery of other 
20

important facts. And investigations of events occurring overseas involving multiple 

parties may well result in disagreements on the facts, and thus increase the 

potential for error. Opening the door to defamation lawsuits that permit the 

factfinder to second-guess the speaker’s motivation may well lead to intolerable 

self-censorship and might dissuade a timorous corporation from freely stating its 

view of the facts. Self-censorship may be further exacerbated by the potential for 

damages, presumed or punitive, that exists in FCPA investigations. Certainly the 

individual’s right to the protection of his own good name is important, but when a 

statement is only published to one audience―an audience that is under a duty to 

investigate it and determine its accuracy, as the DOJ is charged―and is done so at 

that agency’s request, it is necessary to protect some false statements made with 

malice in order to protect other speech that public policy strongly seeks to 

encourage. Self-reporting in response to a criminal probe should be fostered as 

good policy, and there is some confidence in the truthfulness of the statements 

made in connection with these sorts of reports, because false statements could 

subject the speaker to further criminal liability. 

I believe that merely granting a qualified privilege does not properly balance 

these interests here. A qualified privilege requires a determination that the speaker 

acted in good faith, a subjective inquiry that will often require a jury. The 

combination of the broad powers granted both in law and in practice to the DOJ in 
21

investigating and resolving FCPA matters and the DOJ’s solicitation of Shell’s 

cooperation in its ongoing investigation lead me to conclude that public policy is 

best implemented by securing “the utmost freedom” for Shell to respond and 

provide information to the DOJ. Cf. RESTATEMENT (SECOND) OF TORTS § 585 

cmt. c (primary purpose of granting absolute privilege for statements by judges is 

to give them “the utmost freedom” in performing their tasks); id. § 587 cmt. a

(absolute privilege granted to parties to judicial proceedings is “based upon the 

public interest in according to all men the utmost freedom of access to the courts”). 

Shell’s role in providing evidence in connection the investigation is of 

“fundamental importance in the administration of justice. The final judgment of 

[the DOJ on whether to prosecute a possible FCPA violation] must be based on the 

facts as shown by [its statements], and it is necessary therefore that a full 

disclosure not be hampered by fear of private suits for defamation.” RESTATEMENT 

(SECOND) OF TORTS § 588 cmt. a. As part of its determination, the DOJ—much like 

a jury—attempts to separate fact from fiction. Briscoe, 460 U.S. at 335, 103 S. Ct. 

at 1115 (quoting Imbler, 424 U.S. at 439, 96 S. Ct. at 999 (White, J., concurring)) 

(noting that courts’ ability “to separate truth from falsity, and the importance of 

accurately resolving factual disputes in” judicial proceedings warrant absolute 

privilege in order to give witnesses “every encouragement to make a full disclosure 

of all pertinent information within their knowledge.”). The DOJ’s prosecutorial 
22

role requires it to remain neutral and objective in analyzing the evidence presented 

to it, again much like a jury or factfinder. See Berger v. United States, 295 U.S. 78, 

88 (1935). Finally, the DOJ even offers inducements to companies like Shell to 

cooperate in the form of credits used in its settlement formula. Here, the DOJ 

began its own investigation and solicited Shell’s cooperation, and I believe these 

policies warrant encouraging such cooperation through an absolute privilege. 

Shell’s statements were made in contemplation of judicial proceedings

The Court correctly identifies the principal legal issue here: whether Shell’s 

statements to the DOJ were made preliminary to or in serious contemplation of a 

judicial proceeding and are thus absolutely privileged. The Court holds that Shell’s 

statements do not fit within the judicial proceedings privileges, concluding instead 

that the statements are more in the nature of an unsolicited criminal complaint and 

thus not entitled to absolute privilege. Although it is undisputed that Shell’s 

statements here were not made during a judicial proceeding, I agree with Shell that 

its communications to the DOJ were made in contemplation of a judicial 

proceeding—the criminal prosecution that the DOJ did in fact initiate.

The judicial privilege applies to statements made in judicial proceedings

when the statement satisfies three elements: (1) the contemplation of or existence 

of a proceeding (2) that is judicial or quasi-judicial in nature and (3) related to the 

statements. See Perdue, Brackett, Flores, Utt & Burns, 291 S.W.3d at 452. With 
23

respect to the first element, the privilege extends not only to statements in the 

formal proceeding itself but also to statements made before a proceeding is 

formally commenced if a proceeding is contemplated, proposed, or in its 

preliminary stages. See Perdue, Brackett, Flores, Utt & Burns, 291 S.W.3d at 452; 

5-State Helicopters, 146 S.W.3d at 257 (stating that absolute privilege applies to 

“communications made in contemplation of or preliminary to a quasi-judicial 

proceeding”); Watson v. Kaminski, 51 S.W.3d 825, 827 (Tex. App.—Houston [1st 

Dist.] 2001, no pet.) (stating that “absolute privilege includes communications 

made in contemplation of and preliminary to judicial proceedings”); see also 

RESTATEMENT (SECOND) OF TORTS § 588 cmt. e (stating that, in regard to 

communications preliminary to “proposed judicial proceeding,” absolute privilege 

applies “when the communication has some relation to a proceeding that is actually 

contemplated in good faith and under serious consideration by the witness or a 

possible party to the proceeding,” and that “bare possibility that the proceeding 

might be instituted is not to be used as a cloak to provide immunity for defamation 

when the possibility is not seriously considered”). The “preliminary to” a judicial 

proceeding test is applied to lawyers, witnesses, and potential parties in 

contemplated judicial (and quasi-judicial) proceedings. RESTATEMENT (SECOND) OF 

TORTS §§ 586 & cmt. a, 588 cmt. e. 
24

Relying on the “preliminary to” language in section 587 of the Restatement, 

Shell points out that the DOJ ultimately filed a criminal proceeding against Writt

and therefore contends that its statements were preliminary to a judicial 

proceeding. Relying on the “contemplated proceedings” language found in 

comment e to section 588 and a number of Texas cases, Writt responds that Shell 

must prove that either the prosecuting authority had a subjective intent to file 

charges at the time the statements were made—i.e., that the DOJ “actually 

planned” to file criminal charges at the time of Shell’s statements—or that,

objectively, the prosecuting authority “had sufficient information to initiate 

criminal proceedings” before the statement was made. Writt contends that a 

criminal proceeding initiated seventeen months after Shell’s communication does 

not satisfy this burden.

The Restatement’s alternative formulations of the test that expand absolute 

privilege from judicial proceedings to matters preliminary to judicial proceedings

include two components: (1) a temporal component that focuses on the timing of 

the statements (the “preliminary to” statement of the rule) and (2) a subjective

component that focuses on whether a speaker or a possible party to the proceeding 

contemplated a proceeding at the time the statements were made (the “in 
25

contemplation of” statement of the rule).

3 See, e.g., Bell v. Lee, 49 S.W.3d 8, 11 

(Tex. App.—San Antonio 2001, no pet.) (applying judicial privilege when writer 

was contemplating future litigation at time of allegedly defamatory letter); Watson,

51 S.W.3d at 827 (applying absolute privilege to attorney’s letter offering not to 

bring similarly situated parties’ claims against company in exchange for payment 

because letter contemplated suit if payment was not made); RESTATEMENT 

(SECOND) OF TORTS § 588 cmt. e (stating that preliminary to “proposed judicial 

proceeding” prong of inquiry is satisfied “when the communication has some 

relation to a proceeding that is actually contemplated in good faith and under 

serious consideration by the witness or a possible party to the proceeding”). Thus, 

the fact of a subsequent proceeding does not, alone, establish when the speaker or 

possible party first contemplated the proceeding; the speaker may have 

contemplated the proceeding only after the allegedly defamatory statements. See, 

e.g., Hurlbut, 749 S.W.2d at 764 (declining to apply absolute privilege even 

though parties allegedly defamed were ultimately arrested and imprisoned). 

Conversely, the absence of a formal proceeding does not establish that a speaker

did not seriously contemplate such a proceeding at some point. See, e.g., Bell, 49 

 3 The contemplation component of absolute privilege is normally invoked by a 

speaker who is the party (or the party’s attorney) initiating the proceedings, such 

as a district attorney or a plaintiff in civil litigation. But there is no good reason 

that the rule should not also apply to speakers who are potential defendants in a 

proceeding and speak to the party conducting the investigation.
26

S.W.3d at 11 (applying privilege even though litigation contemplated at time of 

letter was not ultimately initiated).

Relying on San Antonio Credit Union v. O’Connor, Writt contends that 

Shell’s evidence proved only an active DOJ “investigation,” not an actual or 

planned “proceeding,” which is not sufficient to invoke the privilege. See 115 

S.W.3d at 99 (stating that “an investigation into criminal activity does not amount 

to a ‘proposed judicial proceeding.’”). The court in San Antonio Credit Union

stated, in the context of a statement made to a prosecuting authority, that “[a] 

judicial proceeding would only be ‘proposed’ when the investigating body found 

enough information either to present that information to a grand jury or to file a 

misdemeanor complaint.” Id. 

I would not follow San Antonio Credit Union—which is not binding on this 

Court—for three reasons. First, the court’s definition of when a proceeding is 

“proposed” is not founded in the case law, could only apply to proposed “judicial” 

proceedings, not “quasi-judicial” proceedings, and would necessarily exclude 

prosecutions under the FCPA, which are pursued without a grand jury or 

misdemeanor complaint. See id. Second, San Antonio Credit Union ignores the 

distinction made by other Texas cases between absolutely privileged statements 

that are made pursuant to an ongoing or already contemplated proceeding and
27

qualifiedly privileged statements that caused, or were intended to cause, the 

initiation or contemplation of a proceeding.

Third, the absolute privilege defense is designed to encourage a speaker to

freely communicate. In the civil litigation context, a potential plaintiff who speaks 

before the litigation commences knows his or her intent—whether he or she 

intends to file a lawsuit—but in the criminal context the speaker who is a potential 

defendant cannot know the intent of the prosecuting authority. Nor is the speaker

privy to all the information gathered by the prosecuting authority such that the 

speaker could attempt to assess whether probable cause to commence a criminal 

prosecution existed at the time. In order to provide assurances to a speaker—the 

reason for recognizing immunity in the first place—the contemplation test in the 

criminal context should not focus on the subjective intent of, or objective proof 

available to, the prosecuting attorney; rather, it should focus on the speaker’s 

subjective mental state. And when the criminal investigation is not initiated by the 

speaker and the speaker is responding to an inquiry by a prosecutor about the 

potential criminal misconduct, I would hold that the speaker as a matter of law 

contemplates judicial proceedings.

For all of these reasons, I would hold that Shell’s communications to the 

DOJ were made in relation to judicial proceedings that were contemplated at the 

time of the communications and thus are absolutely privileged.
28

Shell’s communications to the DOJ were made as part of a 

quasi-judicial proceeding

An absolute protection also protects statements made as part of, or 

preliminary to, a quasi-judicial proceeding. I would alternatively hold that Shell’s 

statements were made as part of a quasi-judicial proceeding.4

A governmental entity has quasi-judicial power if it has the power and 

authority to investigate and “draw conclusions from such investigations.” Parker v. 

Holbrook, 647 S.W.2d 692, 695 (Tex. App.—Houston [1st Dist.] 1982, writ 

denied); see also Perdue, Brackett, Flores, Utt & Burns, 291 S.W.3d at 453 (quasijudicial power includes the power to investigate and decide issues); Clark, 248 

S.W.3d at 431 (same). The policies for extending absolute privilege to quasijudicial proceedings are virtually identical to those for judicial proceedings: (1) 

citizens should have the unqualified right to communicate with decision-making 

governmental agencies without the fear of civil litigation and (2) the administration 

of justice will be better served by full disclosure from witnesses who are not 

 4 Although Shell contends that its statements were in contemplation of judicial 

proceedings and focuses on whether “the important public policy considerations 

underlying the absolute privilege for judicial proceedings” apply here, it also 

argues that the evidence demonstrates that the DOJ investigation “would . . .

satisf[y]” the elements of a quasi-judicial proceeding. We may consider whether 

the DOJ’s investigation constitutes a quasi-judicial proceeding because Writt 

raised the issue in its original appellant’s brief, Shell addressed it as an alternative 

argument in its brief, and the test used by courts in determining whether a 

proceeding is quasi-judicial aids in identifying policy considerations that should be 

considered in the delicate balancing that influences whether an absolute privilege 

should apply here.
29

deterred by the threat of retaliatory lawsuits for defamation. See 5-State 

Helicopters, 146 S.W.3d at 257; Darrah v. Hinds, 720 S.W.2d 689, 691 (Tex. 

App.—Fort Worth 1986, writ ref. n.r.e.). And, like the courts, executive and 

administrative agencies with decision-making discretion often have procedures and 

processes designed to enable them to obtain and sift through information to 

decipher fact from fiction. Thus, public policy often favors allowing such entities 

unfettered access to information over restrictions that encourage truthfulness but 

also limit the information available for the decision-making process. “The absolute 

privilege is intended to protect the integrity of the process and ensure that the 

quasi-judicial decision-making body gets the information it needs.” 5-State 

Helicopters, 146 S.W.3d at 257. 

The DOJ’s FCPA investigation satisfies most of the elements of quasijudicial power.5 The DOJ is statutorily imbued with the duty to prosecute offenses 

 5 This Court has identified six factors for determining whether a governmental 

entity is functioning in a quasi-judicial capacity: (1) whether it has the power to 

exercise judgment and discretion; (2) whether it has the power to hear and 

determine or to ascertain facts and decide; (3) whether it has the power to make 

binding orders and judgments; (4) whether it has the power to affect the personal 

or property rights of private persons; (5) whether it has the power to examine 

witnesses, to compel the attendance of witnesses, and to hear the litigation of 

issues on a hearing; and (6) whether it has the power to enforce decisions or 

impose penalties. Parker, 647 S.W.2d at 695. Other courts have also adopted these 

six factors. See, e.g., Perdue, Brackett, Flores, Utt & Burns, 291 S.W.3d at 453; 

Fiske v. City of Dallas, 220 S.W.3d 547, 551 (Tex. App.—Texarkana 2007, no 

pet.); Alejandro v. Bell, 84 S.W.3d 383, 391 (Tex. App.—Corpus Christi 2002, no

pet.). A governmental agency “need not have all of the above powers to be 

considered quasi-judicial, but certainly the more of these powers it has, the more 
30

against the United States. See 28 U.S.C. § 547 (2006). With respect to the FCPA, 

the DOJ is given wide latitude in establishing and carrying out the procedures by 

which violations are investigated and prosecuted and in determining what and 

when to investigate or prosecute. See 15 U.S.C. § 78dd-2, -3; see also Clayco 

Petroleum Corp. v. Occidental Petroleum Corp., 712 F.2d 404, 409 (9th Cir. 1983) 

(observing that DOJ has “discretion” in bringing enforcement actions and 

“[t]herefore, any governmental enforcement represents a judgment on the wisdom 

of bringing the proceeding, in light of the exigencies of foreign affairs”). The 

DOJ’s authority includes the authority to investigate the facts, draw conclusions 

about whether prosecution is appropriate, and determine what penalties and 

conditions to impose in any settlement. See 28 U.S.C. §547; 15 U.S.C. § 78dd-2, -

3. U.S. Attorneys have the authority to settle FCPA claims asserted by United 

States. 28 C.F.R. §§ 0.160, 0.161. Additionally, the DOJ is authorized to issue 

opinions as to whether a prospective transaction would violate the FCPA. See 28 

C.F.R. §§ 80.1, et seq. The DOJ also has the power to examine witnesses and to 

compel the production of witnesses and other evidence. See 15 U.S.C. § 78dd3(d)(2). 

To the extent that the DOJ’s investigative powers under the FCPA do not 

meet every element of the criteria for defining a quasi-judicial proceeding, that is 

 

clearly is it quasi-judicial in the exercise of its powers.” See Parker, 647 S.W.2d at 

695; see also Hernandez, 931 S.W.2d at 651; Shanks, 169 F.3d at 994.
31

primarily because the DOJ’s determinations must ultimately be either proven in 

court or resolved through an agreement approved by a court. And that failure is not 

enough to disqualify the DOJ from acting in a quasi-judicial manner because, 

while “[a] governmental entity’s power to decide a controversy presented by an 

allegedly defamatory statement is a key factor in determining whether the 

defamatory statement relates to the exercise of quasi-judicial power,” it is not a 

necessary element. See Perdue, Brackett, Flores, Utt & Burns, 291 S.W.3d at 452.

Thus, even without the power to make final decisions, an agency proceeding 

may be deemed quasi-judicial when a statute confers upon the agency “the power 

to conduct investigations and hearings.” Reagan, 166 S.W.2d at 913. The DOJ

meets this test because it has the power to conduct investigations and here 

summoned Shell to meet and provide documents. 

The absence of final decision-making authority was not conclusive in Putter

v. Anderson, 601 S.W.2d 73, 77 (Tex. Civ. App.—Dallas 1980, writ ref’d n.r.e.). 

The court there concluded that the police department’s internal affairs division 

exercised quasi-judicial power because it could investigate complaints received, 

determine whether the complaints were justified, and then make recommendations 

to the police chief or a disciplinary board for discipline. Id. The internal affairs 

division was not required to be empowered to mete out punishments itself in order 
32

to act in a quasi-judicial capacity. Id. The DOJ’s authority under the FCPA is at 

least as great as that of the internal affairs division in Putter. Id.

Moreover, Shell met its burden of demonstrating that the statements were 

made during a quasi-judicial proceeding by presenting uncontroverted evidence 

that, although the DOJ had not yet initiated formal judicial proceedings directed at 

Shell at the time of Shell’s statements, the DOJ had initiated formal judicial 

proceedings against other entities with whom Shell did business in connection with 

the questioned transactions and had initiated its own informal inquiry of Shell. 

Therefore quasi-judicial proceedings—proceedings which are often the only and 

final proceedings for FCPA violations—against Shell had commenced regardless 

of whether it had determined that formal judicial proceedings would be necessary. 

Specifically, Shell has presented evidence of the following facts about the DOJ’s 

activities relating to potential FCPA violations by Shell and its employees during 

Shell’s Bonga project in Nigeria:

• In February 2007 Vetco, an oil-field-services company that was a Shell 

contractor on the Bonga project, entered into a criminal plea agreement in 

which it agreed to pay a $26 million fine for illegally bribing Nigeria 

officials through a forwarding and customs clearance company. 

• Before contacting Shell, the DOJ had begun investigating Panalpina, an 

investigation that eventually revealed that Vetco made its bribery payments 

to Nigerian custom officials through Panalpina for the purpose of facilitating 

the importation of materials for the Bonga project.

• Less than six months later, in July 2007, the DOJ’s Criminal division, fraud 

section, informed Shell that it had “come to [the DOJ’s] attention that [Shell] 
33

has engaged the services of Panalpina, Inc.,” a freight forwarding and 

customs clearing agent for Vetco, and “that certain of those services may 

violate the [FCPA].” In the letter, the DOJ requested a meeting with Shell in 

the DOJ’s Washington, D.C. office to discuss the matter and requested that 

Shell collect certain date to provide to the DOJ at the meeting. 

• Shell agreed during the meeting to investigate its dealings with Panalpina 

and to produce documents and information to the DOJ including information 

about Writt, who was a project manager responsible for approving 

reimbursement requests on the Bonga project and understood that the DOJ 

would conduct its own investigation for possible FCPA violations by Shell 

and its employees. 

• In its July 17, 2007 letter, the DOJ specifically requested that Shell produce 

documents and information relating to Writt. 

• Shell began its investigation in August 2007, using outside counsel, in-house 

counsel, accountants from KPMG, former FBI agents, and former law 

enforcement officers, and interviewing Writt during that month. 

• Shell’s investigation culminated in its February 5, 2009 report entitled 

Nigerian Customs Issues on the [Shell’s] Bonga Project and in the 

Temporary Importation of Vessels into Nigerian waters “with the 

understanding that [it] would be treated confidentially.” 

• Shell Nigeria entered into a deferred prosecution agreement in November 

2010 in which it acknowledged responsibility for its employees engaging in 

conduct violating the anti-bribery provision of FCPA. The terms of the 

agreement specifically state that the DOJ entered into this agreement in part 

because Shell Nigeria “cooperated with” the investigation, undertook 

remedial measures, “agreed to continue to cooperate with . . . any ongoing 

investigation” by the DOJ into potential violations of FCPA, and agreed to a 

$30 million fine.6

 6 Shell’s evidence with respect to the DOJ’s investigation and settlement of the 

FCPA case against Shell is largely uncontroverted. In his response to Shell’s 

motion for summary judgment, Writt addressed Shell’s privilege defense primarily 

on legal grounds. The only evidence he cited in this regard—an expert affidavit 

from a law professor who previously worked at the DOJ—related to whether the 

DOJ had “the final word on whether a crime ha[d] occurred.” 
34

For all of these reasons, Shell’s communications to the DOJ were made in 

contemplated or ongoing quasi-judicial proceedings and should be afforded the 

same privilege.

Conclusion

The issue here is of extraordinary importance to the many international 

companies in Texas that face FCPA inquiries from the DOJ. Absolute privilege is 

recognized in limited circumstances because it creates a bright-line rule upon 

which witnesses may depend, thereby incentivizing witnesses to make expressions 

that may serve important public interests without fear of being subjected to civil 

litigation. Shell’s statements here did not trigger or instigate a criminal 

investigation; they were part of Shell’s communication to the DOJ reporting the 

results of its internal self-investigation and information gathering, spurred by the 

DOJ’s request for information and cooperation in its ongoing investigation to 

determine whether and whom to prosecute for violations of the FCPA. As such, 

they should be, and I believe under existing law are, absolutely privileged.

I therefore respectfully dissent.

Harvey Brown

Justice 
35

Panel consists of Justices Jennings, Sharp, and Brown.

Justice Brown, dissenting.