## In the Court of Appeals Second Appellate District of Texas at Fort Worth

___________________________ No. 02

- 19

- 00401

- CV

___________________________

On Appeal from the 348th District Court Tarrant County, Texas Trial Court No. 348

- 282711

- 15

Before Sudderth, C.J.; Kerr and Birdwell, JJ. Memorandum Opinion by Jus tice Kerr 

### J OE 

### G RISEL 

### , D AVID 

### M ORR ISO N 

### , HMCRT, LLC, E NVISAGE 

### C APITAL 

### , LLC, C YNDE X 

### S ERV ICES 

### , LLC, W ANDA 

### J. B ARRERA S 

### , AND 

### C

- 7 D EVELOPMENT 

### P ARTNERS 

### , LLC , Appellants

V



### . E VEREST 

### I NTERNATIONAL 

### , LLC , Appellee2 MEMORANDUM OPINIO N
A pp ellee Everest International, LLC su p plied Creat ive Essentials, LLC (CE)

w

ith LapDesk products that CE sold to ret ailers

. W hen CE started exp eriencing
financial t rouble , it brought in business cons ultant a ppellant Joe Gr isel and his
company , a ppellant HMCRT, LLC , to help s ave CE

. Grisel e vent ually involved other

a ppellants in th e project: David M orrison ; Envisage Ca pi tal, LLC ; Cyndex Se rvices , LLC ; Wanda J. Barreras ; an d C

- 7 Development Partners, LLC

. From CE ’ s perspectiv e, th e pro ject failed, and C E never recovered financ ia lly

. Everest claim s tha t while C E verged on financial c ollapse , Grisel and Mo rr ison dupe d Eve rest into extending additional credit to CE , and that they conspired with HMCRT, E nv isage, Cyndex, Barreras , and C

- 7 Development to defraud Ever est.
A fter a ten

- day trial, a jury agreed a n d fo und for Ever est on i ts fra ud and negligent

mi s re pre sen tat ion claims against Grisel and Morriso n and on its civil

- conspiracy claim against Grisel, Mo rrison , HMCRT, E nv isa ge, Cyndex, B arrera s , and C

7 Development (collec tively , “ the Defendants ” )

. The ju ry awa rded Ev er est over $430,00 0 in actual damages and over $1. 3 million in ex emplary dam ages against
Grisel. The tr ial court red uced the ex emplary

- damag e award in accordan ce with Tex as law and signed a judgm ent on the verdict a warding Ever e st actual damages against th e
D efendants jointly and severally and exemplary damages against Grisel.
The Defendants have appealed and r ais e eight is sues: (1) Everest lacked standing to sue t he D efendants; (2) Everest lacked capacity to maintain this suit3 because it is a foreign entity not registered to do business in T e xas ; (3) Everest did not actually an d justifiabl y r ely on Grisel ’ s and Morris on ’ s alle ged re presentations as a matter of law; (4) the evidence i s insufficient t o suppo rt the jury ’ s fr aud and negligent

mis re presentation findings against Morrison; (5) the evidence is insufficient to support
the jury ’ s civil

- con sp i racy fin ding ag ainst the D efend ants; (6 ) regarding the jury ’ s

ex e mplary

- damages predica te finding again s t Grisel , there is no clear and co nvincing evidence to support the jury ’ s m alice and gross

- ne gligen ce findings , and the jury charge failed to proper l y d efine “ f ra ud ” ; (7) some of Eve r est ’ s comments during closing arg ument s were improper, i ncurable, and har m ful ; and (8) i f we reverse the jury ’ s conspiracy findings but affirm the f raud and negligent

- mis represen t ation
f indings , Gri sel and Mo rrison cannot be held joi ntly an d severally liab le bec ause
Ever est fa iled to requ est pr oport ionate

- liabi lity findings from the jury

. We w ill reverse and render in par t on Everest ’ s claims against Barreras and Cyndex and affirm the trial

court ’ s judgment in all other re spect s.
I. Background
Everest

— a logistics and import company

— is a Florida LLC t hat does busine ss in Texas. Eve rest is owned by Enoch Poon and Pat Sullins

. Sullins ’ s fa mily fr iend of 25 years , Mike J ennin gs, owned A r lington

- based CE

. 1 For about 20 years, Everest h ad

1 Je nning s die d in January 2017.4 source d and imp orted LapDes k produ cts from overs eas for CE to sell under its

“ LapGear ” bran d to retaile rs in the United States. Ev erest w as CE ’ s sole supplier.
A. CE brings in Grisel and his team
Sometime i n 2013, CE began experiencing f i n ancial difficulties , in cluding

mo u nting debt to lenders, l ack of c ash flow, an d inability to pay its suppliers, including Everest

. In September 2013, Grisel, a self

- employed bu siness consu lt a nt ,

was intro d u c ed to Jennings by a mut ual friend

. After Jennings and Grisel met several
time s , G risel agreed to help CE. To that end, Gr isel and Jennings agreed to a $ 25 ,000 flat fee for G risel ’ s servi ce s fro m S ep tembe r 2013 through February 2014.
Acco rding to Grisel, he and his company HMCRT 2 are bu siness “turnaround specialists

. ” The acr o nym HMCRT represents a “ gr oup of people ” who are experts in human resources, ma rk eting , capit al , raw materials, and te chnology. Grisel ’ s plan to help CE included acqu iring funds for CE and bringing in a group of individuals to help CE w i th integration, technology, automation, prototypes, and financial p ractices. Among o thers, Grisel eventually in vo l ved the following people and entities in the CE project :

• Morrison, a so f twar e architect and Grisel ’ s lo ng

- time friend ;

• M o r r i s o n ’ s c o m p a n y Envisage ;

2 When G risel s tarted working with CE, HMCRT w as not i n c or porated, and Gr ise l considered it a sole proprietorship. H MCRT was incorp ora t ed in May 2014. G risel is HMCRT ’ s so le owner
.5 • C

- 7 Development, a Grisel

- ow ned company t hat “does a little bit of everything” and that also owned the house in which M or rison lived ;

• Barre ras (who is also M o rriso n ’ s si ster) ; a nd

• Cyndex , a book k eep ing and corporate

- setup bus iness that Barrera s and her husband own . E nvisage ev entually entered into an indep endent

- contractor agreeme nt with CE, and un der this contract, Morrison worked o n i ntegrating multiple fac e t s of C E ’ s bus iness in to one software packag e, as well as prototyping, automation, and installing a new phone system. Barreras incorporated HMCRT in May 2014 and designated
C yn dex a s HMCRT ’ s registered agent

. Barreras and he r husband al s o contro lled the

“ C

- 7 Trust ” account , wh i ch was open ed to “ manage whatever assets or mon ey went in and out ” of C

- 7 Development. Ac c ording to Bar reras, funds depo sited in to tha t

accoun t belonged t o Gris el even though he was no t a n ac co unt holder or s ignat ory on the accoun t, and she and her husband held those funds “ in trust ” for Grisel ’ s bene fit

. Ba rreras would eventually bri efl y work as an indep e ndent contrac tor for CE, assist ing with updat ing the emplo ymen t manual and obtaining insurance. With Jenni ng s ’ s approval, Gris el also recruited Ken F azend e, Ray Ya uk, Ben Grisel, a n d Dave Si mcho to work for CE. Al l bu t Yauk had criminal b a ckgrou nds.
Fazend e

— a for m er CPA and former spe cial agen t for the United States Treasur y Department

— had f ederal felony convictio ns for a “ scheme to co nceal and cover up

mat er ial facts ” a nd for the “ prod uc tion of s e xually explic it depictions of a m i n or fo r imp or tation into the Uni ted States. ” Fazende was hired to work as CE ’ s financi al6 man a ger an d used an al i as (Ken Phillips ) while doi ng so. Gris el ’ s young er b rother Ben

wa s a n op i oid add ict and was under a fe der al in dic tment for co n s pirac y to d istr ibute opi oids wh i le he was working at CE selling old inventory and “ help [ing] wi th spreads he e ts. ” Ben was in re cove ry and clean w hile worki ng a t CE but was later
convicted o f cons pir acy to distrib ute
. Sim ch o had been convicted of federal bank
f

raud and worked as Grisel ’ s ex ec utiv e assi stant under the ali as Dave Marion

. B
. Gris el m e ets with Sulli ns By earl y 2014, CE ’ s relati onship with Everest

— CE ’ s sole s upplier

— h ad
beco me f i n a ncia lly strained bec ause CE o w ed Ever est $9 33,00 0

. On Mar ch 4, 201 4 , Sullin s no tified his long

- time f riend Jenni ngs “ with a heavy heart and great regret ”
that Eve rest would no t ship an y more goods or extend any mo r e credit to CE

. A fe w days later, Jennings asked S u llins to meet with Grisel

. On M arch 11, 2 014 , Sullins met with Gr i sel at CE ’ s offices

. Ac cor ding t o Sullins, Grisel repre sented that he was a h ighly experienced an d succ ess ful business

turn aro und exp ert wh o had “ turned around ” many companies ove r t he year s . Grisel
claim ed to h ave a te am o f “ experts ” in hu m an resources, management, te chn o lo gy ,

an d capital, which he r eferred to as HMCRT. Grisel cl ai med that he and H MCRT

w ere going to turn CE a round , that they woul d “ be in and ou t
. . . in 30 to 60 days , ”

a nd th at Sull ins “ woul dn ’ t even recognize the com pany when they were done. ”
S ullins testified t hat he understo o d that Grisel was “ represe nt ing [hi s] company and hi s p artner , and they were going to bring their group in and work with [CE] to7 make imp ro v eme nts, p ut some mone y in, and turn it around

. ” Sull ins further
unde rsto od that Grisel was au tho rized to negotia te with him on CE ’ s beh al f and to
work with Evere st t o re

- establis h cre dit

. During Gri sel and Sullin s ’ s m ee ting, Grisel r epresented t hat M o rrison wa s hi s partner in HMCRT and was re a dy to invest $500 ,000 in CE im mediately. Grisel als o claimed that CE h ad b een approved fo r an SBA loan but that h e an d HMCRT could help CE get more favorable loan t erm s be cause Mo rrison had agreed to inve st $500,000 in CE

. Gri sel further represen ted th at some of the $500 ,000 would be used

to pa y Ev erest
. Grisel also ask ed Sullin s if Everest would extend more credit to C E
and sha re the int er est cost s of a b ridge loan to co ver CE until th e SBA loan could be
finali z ed. Sull ins ref used and left the meeting

. At Jennings ’ s r equest, Sullins met with Grisel at CE again three days later

. D uring this s econd meeting, Grisel re pea t ed his representatio n s from the f i rst

mee t ing , including M orrison ’ s imminent $ 500,000 cash infusion

. Grisel fur ther represented that becaus e o f his, M or riso n ’ s , and HMCRT ’ s in volv ement and th e
money “ going in , ” CE would be able to timely pay Everest in the future

. Grisel also
pr omised that CE would pa y Ever e st the pa st

- d ue amount s over the next th ree months and t ha t if Evere st would extend new cre dit to CE , CE would pay E ver est

“ on time going forward

. ” Gri se l repres ent e d that Everest ’ s extension of cr edit, along
with Gri s el and HM CRT ’ s in vo lvemen t, would cause CE ’ s business to grow, which

w o ul d in turn lead t o more business for Eve re s t
.8 Based on Grisel ’ s r epresen tation s, Su ll ins was sa tisfied that “ this is a doa ble
deal ” that would ge t CE “ t urne d around , ” and Ever est thus r eopened CE ’ s credit in
the fo rm of process ing a “ h u ge ch unk of purchase orders

. ” Sullins also a greed that Everest would pay ha lf the in te rest o n CE ’ s bridge loan 3 and agreed to give CE a

cre dit to ad dr ess some quali ty issue s on produc t s Ev erest had sup plied to CE in the
past
. After the meeting, Sullins sent Jennings an email outlining wha t he and Gr i sel
had d iscussed

. 4
C. Morrison ’ s $500,00 0 investment
Mor rison ’ s $5 00,00 0 immedia te investmen t in CE tur ne d out to be a loan from
Morris on ’ s friend Jim Thompson that didn ’ t make it s way to CE until June 2014

. In
March 2014 , Thompson loaned th e fund s not to M o rrison but to C

- 7 Development ; Gris e l ex ecut ed th e promi s sory note on C

- 7 D evelopment ’ s behalf , and the loan was secured by Mo rrison ’ s residence, which C

- 7 Develop ment owned. 5 At Gri sel ’ s directio n , Barreras accep ted the loan pr oceed s into t he C

- 7 T ru st acc ount and t hen (1) d istr ibuted about $25,000 of the loan proce eds to Grisel in cash a nd (2) transfe rred

3 E v e rest “ paid ” t he interest on the bri dge loa n by “ letting [CE] take it as a discount ” “ off o f some invoices. ”

4 Sullins ’ s outline di d not mention Morri son ’ s $ 500,000 investme nt.

5 Morrison ex plai ned a t trial th at he had purch ased the proper t y in 20 01 and had ple dged it a s secur ity for a $650,000 tra n saction wit h Gris el that “ fell th r ough , ” which was how C

- 7 D eve l opment came to own the p roperty. After that, Mo rrison le ased the property until he mov ed out in 2 015 o r 2016.9 about $18 ,000 of the loan proceeds i n t o Cyn de x ’ s account

— which belong ed to
Bar re ras and her husband

— to buy a car for Mo rri so n. Grise l lat er directe d B arreras to d istribute the r ema ining loan proceeds to C E

. In June 2014, Barreras made two $200,000

- plus tra n sfe rs from the C

- 7 Trust a cco unt to th e Cy nd ex account
. In m id

June , Ba rr eras pai d $15 ,000 from the Cy ndex account to CE, and lat er that month , sh e pai d $4 41,000 from the C y n dex account to CE

. D. Evere st contin ue s exte nding credit to C E Over the ne xt few mo nths, Grisel a nd his te am continued wo r k ing with CE.
Grisel ’ s primary g oal for CE was ge tting an SBA loan so that CE could pay off a $1 .2 millio n credit line that was i n default

. During thi s time, Gris e l w orked wi th Jennin gs to improve CE ’ s financials and to complete sev er al SBA loan applications ,

w h ich CE submitted to various banks

. Also during this time , CE paid Grisel and
Morrison each $ 10,000 per month in c on sulting fees, 6 alon g with thous a nds in fees to
th e other members of Grisel ’ s “ team
. ”
Mea nwhile , Everest c o ntinu ed to extend credit to CE based on Grisel ’ s an d
M orrison ’ s conti nued representations

. Acco r ding to Sullins , Morrison reaffir med
G risel ’ s representat ion s that M or rison “ wa s [G rise l ’ s] business partner in [HMCRT] , hi s fi nancial g uy, hi s money m an, who was going to bring the $ 500,000 into this

6 M orrison was paid t hrough E n visage. CE paid Gr isel based on a monthly invoic e from Ya uk ’ s company Dry Fa brication and Welding, Inc. by wiring mon ey to G risel ’ s mother

- i n

- law ’ s bank account.10 bus iness deal[]. ” But CE failed to make paymen t s to Ev erest as p romi sed. W hen
Sul lins app ro a c hed Mo rrison in A pr il or May 2014 about Everest ’ s not getting paid , Morrison told Sullins that he did not have the money and was going t o have to
borrow it

. Sullins later lear n ed tha t G risel never int en ded for CE to pay Everest for
the credit it was e xtend ing and wa s working t o move CE ’ s business away from
Ev erest and to a new supplier

. E. CE n ever r ecover s , and Su llins and Poon buy most of CE ’ s assets When CE fai led to o bta in an SBA lo an , tens ions aro se between Jenni ngs and
G risel. I n la te Oc tober 2 0 1 4 , J ennings sent a memo to all CE employe es explaining
that over the last year or so, the company ha d “ struggled with financial stability, which
le ad [sic] to ou r engaging th e HM CRT gr oup, inc luding [Morrison] and [ F azende ] ”
bu t that CE ’ s f in ancia l posi t io n ha d not imp roved because it had failed to obtain an SB A lo an. On O c t ober 31, 201 4, J ennings terminated CE ’ s relationship with the

“ HMCRT Group , ” which accor ding to Jennings i ncluded HMCRT , Grisel, F azende , and Morrison.
B y the tim e C E cut ties w ith Gri sel, CE o w ed Everest o ver $1.32 million.
Ever est thus stoppe d extending credit to CE in October 2014 and put CE on cash

on

- d elivery ter ms . I n a n a ttempt t o m i tigate Ever e st ’ s losses, Sullin s and Poo n fo rm ed
Cr eative Ma n uf acturing, LL C (CM) , w hi ch purchased some of CE ’ s assets and inventory in April 2015 an d rel eased a bout $122 ,000 of CE ’ s d ebt to Everest.11 CE ha s never paid Everest the entire b alance o w ed. CE and Ev e rest continu ed
d oin g limited business together on a cash basis until Jenn ings die d in Januar y 201 7

. F. Everest sues
It turned out that Grise l ’ s and M orrison ’ s r e p rese ntations to Sullins were false:
CE did not h ave an SBA loa n ap prove d in Ma rch 201 4 , and Morris on didn ’ t have $500,000 to immediately inv est in CE

. 7 Because Everest ha d relied on these
rep rese ntation s

— along wi th Grisel ’ s repre sentat ions re gard i n g his business

turnaround exp ertise and HMC R T ’ s te am of “ expert s ”

— in decidin g to extend
additional credit to CE, Everest sued Grisel and M orrison fo r fraud by misrepresentation , fraud by non d is closur e, a nd negligent mi s r epresentation. E v e r est

a lso asserted a civil

- con spir acy clai m again st Gris el, Morri son , HMCRT, E nv isag e, Cyndex, Barreras , and C

- 7 Development

. Everest soug ht actual and exemplary damages.
At tr ia l, Sullins testified t hat Grisel had r e pre sen ted that he w a s au t h orized to negotiate on CE ’ s behalf a n d that “he wa s going t o b e coming int o CE with his group to run the company going forward.” S ullins stated that Grisel ’ s representation that
Morris on could immediate ly invest $500,00 0 in C E wa s th e mos t imp o r tant representation upon whi ch he re l ied in decidi ng t o e xt end cre dit to CE. According to Sullins, Grisel ’ s representatio ns that Morrison had $500,000 “in the bank” an d was

7 Morrison admitted at trial t hat he d id n ot ha ve $500,00 0 to invest in CE because he was on th e verge of filing for b a nkr uptcy.12 “ready to put the mo ney in” were im po rtant to Sul lins b e cause the q uick infusion would give CE cas h flow to p ay its bil ls ( es pe cially th e mon ie s ow ed to Ev erest) and would help improve CE ’ s fina ncial he alth to increase its chance of securing an S BA
loan.
Su llins further tes tified t h at Grisel had r epresented that Morrison was h is
pa rtn er i n HM CRT, “ h is fi nanc ial guy, ” and “ his money m an ” who was going to bring $500,000 into CE a nd that Mo r r ison “ reaffirmed that to me in later mee tings and
discussions. ” Sul lins stated that Ever est would not hav e extended cre dit to CE if h e h ad k n own that M o rr ison was going to hav e to borrow the mon ey. He further
testified that he would not have extended credit to CE if he had k nown that
Mo rrison ’ s “ investment ” was g oing to take over thr ee months to make its w a y to CE

. Sulli ns expl ained tha t t his three

- month delay harmed Everest because I got further

-- they got fur ther an d further behind on me. And once that happens, they owe you so much money that if yo u cut them o ff, they ’ re going to go out of business. So it ’ s like now t hey hav e me over a b arre l at that point. And that ’ s where I was trying not to go on March 14th

-- or on March 4th, when I discontinued business [before Jennings persuaded me to mee t with Grisel ] . I was trying to put a stop to the bleedi ng, because if I let it go any further, it w ould bury me.
S ul lins cl aimed tha t Grisel and M orrison “ tol d me many thi ngs that weren ’ t true and with the express intent of asking me to extend c redit to a compan y that they were trying to pull a big, huge SBA loan out of so that they c ould skim m o n ey ou t of that
lo an.” Sullins a lso testified that unde r G risel ’ s g uid ance, CE falsified its finan cials to
make th e company ap pear healthier on i ts SBA loan appli cations

.13 A ccording to Sull ins, Gr is el and his team “ ran [CE] into the groun d

. ” 8 Had
Sullins known wha t he knew at trial a bout Gri sel and HMCRT, he would not have

exte nded credit to CE

. As a re s u lt of Grisel ’ s and Morrison ’ s representation s to
Sull ins, Everest paid about $3 4,000 i n bridg e

- loan interest ; credi ted C E ’ s ac count for

over $17,000 to remedy a p r odu c t

- qu alit y issue ; and ultima tely e xtended over $38 7, 000 in credit to C E

. Everest ’ s l osses totaled about $439,000 over and above the $933,000 that CE had already owed it

. Ov er th e course of the ten

- day trial, the jury heard testimony from Sullins ; Gr isel ; Kris Jennings (Jennings ’ s son) ; Fa zende ; Poon ; Barreras and her hu sband Ray ;
Ya uk ; Mo rri son ; Everest ’ s counsel ; a nd Wayne Whitaker , a Fort Worth attorney. 9 At
the tria l ’ s conclusion , t he jury found for Everest on its fraud and negligent

misreprese nta t ion claim s ag ainst Gris e l an d Mo rrison an d found that E ver es t had

s uffered $43 9 ,1 29 .65 in out

- of

- pocket los s es as a result. The jury a l so found that the
Defendants ha d c ivilly conspired to de fra ud Ever e st
. The jur y furthe r found by cl ear and conv i ncin g ev ide n ce that Everest ’ s harm r e sulted from G rise l ’ s m a lice, fraud , or

8 This a ssertion is supporte d b y CE ’ s financials : CE ’ s n et lo ss in 2013 had b een about $2 4 0,000; for 2 014 , i t more tha n trip led to about $77 4 ,000. Ul timat ely, Gris e l and his team “ pulle d out ” almost the “ ex act amount ” t he y represent ed to Eve res t t hat they would put into CE.

9 Grisel and Whitak e r had met several years ear lier t hrough a men ’ s Christian g roup. Wh i ta ker and Simcho had tried to start a company togethe r , and Gris el assisted the m with “ ideas, spreadsheets, [and ] c on c epts. ”14 gross n egligence, and awarded Ever est $1,317,388.95 in e xe mplary damages

. The jury ’ s verdict was una nim ous . The trial cour t signed a final judg ment in cor po r atin g the j ury ’ s findings and ( 1) a w a rd ed E ver est $439 , 12 9. 65 in actual damage s a g a inst Grisel a nd M orrison (for
the fraud claim) an d Barreras, HMCR T, Envisage , Cyndex, and C

- 7 Development ( for the conspiracy claim ) , joint ly and s everally ; (2) redu ced the e xem plary damages to an

am o unt tw o times the am ou nt of economic damages in accordan ce with Texas Civil
Prac tice and Remedies Code Se ction 41.008 ; 10 and (3) awar ded Everest $878,259 .30 in exempla ry damages against Grisel.
The Defendan t s moved for ju dgment notwithstanding the ve rdict ; move d f o r a new trial, or alternative ly, fo r a remittitur ; and moved to mo dify , corr ect , or re form the judgment. The Defendants ’ moti ons were overruled by opera tion of law, and they
ti m e ly appealed

. II. Stan d ing
I n t heir first i s su e, the Defendants complain t hat Ever est lack s standing
because (1) as part of CM ’ s purc hase of CE ’ s assets in A p ril 2015, E verest r eleased
CE from all claims related to prod ucts sold or supplied by E verest b ef o re August 1, 2014, wh i ch inc luded C E ’ s debt fo r products that Eve rest had supp lied to C E on credit , and (2) E verest failed to e stablish t ha t t he Defendants b reached its legal rights

.

10 See Tex. Civ. Prac. & Rem. Code A nn. § 4 1.008(b)

.15 A. Applicable law and standard o f review

“ S tandi n g is a con stitut io nal p rerequis i te t o s uit , ” and “ [a] court h a s no jurisdiction over a cl a im made by a plain tiff who lacks standing to ass ert it. ” H ec

kman
v. Williamson C n ty. , 369 S.W.3d 137, 150 (Te x. 2012 ). Because standing is a compo ne nt
of subject

- mat t er jur i sdi ction, i t s e xistence i s a l eg a l q uestion th at we rev i ew de novo

. See Farmers Tex. C n t

y. Mut

. In s. Co. v . Beasle y , 598 S.W.3d 237 , 24 0 (T ex. 20 20 )

. In evaluating standing , we construe the pleadi ngs in the plaintiff ’ s f avor , a nd we co n sider
eviden ce r e levant to the ju ris dictional inq u iry

. S ee id

. A stan ding i n qu iry “ focuses on the question of who may bring an action

. ”
Vernco Constr., Inc. v. Nelso n , 460 S.W.3d 145 , 149 ( T ex. 2015 ) (q uot ing Patter son v . Plan ned Parent hood of H o us . & Se

. Tex., Inc

. , 971 S. W.2d 439 , 442 (Tex . 1998 ) ). Generally, unless s tand i ng is co n ferred by statute, a plaintiff mus t dem onstrate that i t “possesses an interes t in a co nflict dist in ct f r om tha t of the g ene ral public, s uch t ha t
th e defendan t ’ s actio n s have caused the plainti f f some particular in jury

. ” Williams v.
Lara , 52 S .W.3 d 171, 17 8 (Tex. 2001). To have standing , a plain tiff must be personally aggrieved. N ootsie, Ltd. v. Willi amso n C n ty. App raisal Di st. , 925 S.W. 2d 6 5 9, 661 (Tex.
1996 )

. Standi n g requires “a real con tro ver sy between the par t ie s ” that “will be actually
dete rmined by the jud icial declaration sought , ” A u stin Nursin g Ctr., Inc. v. Lovato , 171 S. W .3d 845, 849 (Tex. 20 05) (quoting Nootsie , 925 S.W.3d at 662) , and “ f o cu ses

on whe ther a par ty h as a s uffi cient re la tionship w it h the lawsuit so as to hav e a

‘ ju sticiable i nterest ’ in its outcome , ” id

. at 848. “ W it hout [ a ] b reach of a legal right16 belo nging t o the plainti ff[,] no cause of actio n can acc rue to [its] bene f it. ” N o bl es v. M arc us , 533 S. W.2 d 92 3 , 927 (T ex. 1976 ).
B. Analys i s The Defendants first a rgue tha t Everest lacks st anding to su e them be cause as a
p art of th e asset

- p urchase agre ement b etwee n CE and CM, Ever est r eleased CE from
all clai ms “ in any way re l a ted to pr o du cts sold o r suppli ed by E ve rest pr ior to Aug ust 1, 20 1 4, ” which t he Defendan ts contend wou ld have included C E ’ s d ebt related to
pro du cts supplied by E verest
. Releas e is an af firma tiv e d efense “ wher e the def endant
bears t h e burden t o plea d and prove the e xist en ce o f an ef fectiv e and val i d rel ease. ”
Barras v. Barras , 396 S. W.3d 154, 170 n.5 (Tex. App.

— Housto n [14th Dis t.] 2013, pet.
denie d) ( citing Williams v. Gl ash , 7 89 S.W.2d 261, 264 (Tex. 1990)) ; see Tex. R. C iv. P.
94

. Whether t h e relea s e be tween Ever est a nd CE released the Defend a nt s goes to the
merits of th e case, w hic h we d o not consider i n determinin g standin g. 11 Se e DaimlerChrysl e r Co rp

. v. Inma n , 252 S.W .3d 29 9 , 305 (Te x. 20 08 ) ( “A plaintiff d oes not
l ack standing simp l y bec au se he cann o t prevail on the m e rits o f his cl aim; he lac k s standing because hi s claim of inju ry is too slight for a co urt to af ford redr ess.” )

. W e thus reje ct the Defendants ’ first st an ding argument. Next, the Defendants a rgue that Everest la ck s st a nding b ecause it fa i led t o

es tablis h tha t a n y of the Def endant s b r eached Everest ’ s legal right s b e cause non e o f

11 We note t h a t altho ugh th e Defend ant s p leaded th e affi rm ativ e defen s e of releas e , the y d i d n ot request or obtain a jury finding o n it.17 the Def endant s h ad a re lat io n s hip wi th Everest at th e time it extended addi tion al
credit to CE

. I n suppo rt , the D efen d ants re ly on Nob les , in whi ch t he supr eme cour t held t h at the plaintiffs lack ed standing to m ai ntain a f raud claim becau se t hey were

not t he d efrauded parties

. 5 33 S. W. 2 d at 927 ( “ A suit to set aside a deed o btained by
fraud c an only b e maintained by t h e defra uded par ty. A party wh o was no t d efr auded by the convey a nc e has not suffered an invasion of a lega l righ t a nd theref ore does not hav e s tan din g to bring suit based on t hat fraud. ” (citati ons omitted))

. Bas e d on Nobles , the D efendant s argue that Ever e s t lack s standi n g b ecause they di d no t b rea ch
Everes t ’ s legal r ig hts and because an y alleged fraud claim belonged to CE, no t
E v erest. The y point out t hat at the tim e o f Gri sel ’ s alleged represe ntations to Everes t , G risel was not “ an owne r of CE, nor a sha r eho lder, office r, director, or e mp loy ee ”

a n d “ ha d n othin g to do w ith w h at pr o ducts CE ordered or when Everest got paid , ”
wh ich , according t o the Def endants, was Jen nings ’ s dec ision alone

. The D efendants
thus cont end that b ecause it was CE that o w ed Evere st money, Eve r est “ failed t o show any b reach of a l egal right it had b y an y of the Defendants t ha t wou ld give rise

to a cause of act ion fo r damages

. ” The Defendants f urthe r claim that a ny alleged
fraud claim be longed to CE , not Everest , b ecause CE i nc urred furt h er debt with
Ev e res t b as ed on th e D e fenda nts ’ alleged repres e ntations

. Here, in s upport of its fraud cl aim, E v erest pl eade d that Gr isel and M o rri son
intentiona lly m ade materia l and fal se r epresentati ons and omissio n s to E ver est and
that E veres t relied on tho se mi s rep rese ntat ions and omi s sions in ex t end ing ad ditional18 c re dit to CE. Similarly, in supp ort of its negligent

- m i s r epr es entation clai m, Everest pleaded tha t Gri se l and Morriso n neglige nt ly made misrepr e sentation s upon w hich
E veres t relied in dec iding to exte nd a dditi onal credit to CE. Everest fu rther pleaded
that the Defendants “ act ed i n combination with one an other t o a c complis h improper
or unlawful ob jects and extract monies and other item s of value from [Everest ] by and
thro u gh one or m ore dish ones t, un lawful [,] or overt acts
. ”

“ A fr a ud claim is person a l to the def rauded party. ” Zaan, LLC v. Sangan i , N o. 05

- 12

- 0 042 3

- CV , 2015 WL 2398652 , at * 4 (Tex. App.

— D allas May 20, 2015, pet.
den i ed ) (mem. op.) ( citing Nobles , 5 33 S

. W. 2 d a t 927 )

. “ Con s e que n tly, only the
defrauded par t y h as sta nding to assert a fraud c laim. ” Id. (citing Nobles , 533 S.W. 2 d at
927 ). Her e, E verest ’ s frau d and negligent

- m isr epr esentation cla ims a r e based on Grisel ’ s an d Mo rriso n ’ s mis representat ions and o m is sion s to Eve rest , and ther e was evidence presente d at trial that based on these mis representat ions and om is si on s , Everest extended add itional credi t to CE , helped CE pay brid ge

- l o an intere st, a nd
credited CE ’ s ac coun t to addr ess some product

- quali ty iss u es . An d it s civil

- c onspiracy
claim against the Defe nd a nts is p redicated on G r is e l ’ s and Morrison ’ s alleg ed frau d

. V

iewing Ever est ’ s pleadings i n i ts favo r a nd consi dering the t rial evidence , we t hus

co nclud e that Everes t had standing to mai ntai n its fra ud and neg li gent

m i s repr esentation claims against Gr i s el and M orris o n a nd its civil

- con spiracy claim

a gains t the Def endants

. We thus o ver rule the D efend ants ’ f irst issue.19 III. C ap acity
The Defe ndant s complain i n their seco nd issue that Ever est lac k ed ca pacit y t o

ma i ntain i t s suit and to r ecover judgment becau se Ev e rest ( a Flor i da li mited

- liability
company ) is n o t regist e red to do business in Texas. See T e x. B u s. Orgs. C ode § 9 .051(b) ; see also T ex. R

. Civ. P. 93 (1), (2).
Sh o r tly befor e t ria l, the De fe ndants fil ed a ve r ified plea in ab a tement asserti n g

t h at be ca use Ev e rest was a Flor ida L LC doin g b usiness in Texas but was not regi st e red to do business here, T e x as B us iness O r gan iz ation s Code Secti o n 9 .0 5 1(b) prohibited Everest from mai n t ai n ing or pro secuti ng this case

. That section requi r es a for eign e n tit y t o r eg ister with the Texas S ecret ary of St ate to main tain a c ause of
action ar ising out of “ the trans ac t i on of business ” i n T exas. See T ex. Bu s. Orgs

. Code. § 9

. 051(b )

. Ba se d on S ection 9. 051, the D efendants ar gued that Eve rest could not
mai n ta in its suit and thus ask ed the t r ial cour t t o abate the case “ pen ding Everest ’ s registration as a f oreig n limited l ia bi lit y com pany ” in Texas or, alternativ ely , to d i smiss
th e sui t
. At the hearing ’ s concl usion , the trial cour t d eni e d the p lea in abatement and
d ismissal mo tion “ f or the t ime being. ” The Defendants re

- urged their capacity
ch al l enge in their J NOV m o t ion

. A. S tandard of rev ie w and app li ca ble law
Th e D efendants p roperl y raise d their c apaci ty challenge t h ro ug h t heir ver ifi ed
p lea in abateme n t. See Du radril, L .L.C. v. Dynomax Drillin g Tools, Inc

. , 516 S.W.3d 147 , 1 57 (Tex . A pp.

— Houst on [14 th Di st.] 2017, no pe t. )

. We review a t rial c ourt ’ s ru ling20 on a p le a in abat ement for an ab use of di scret ion. Wyatt v. S ha w P l u

mbing Co. , 760 S.W.2d 245, 24 8 ( Tex. 19 88); Angl o
- Dutch Petroleum Int ’ l, Inc. v. Ca s e Funding Network, L P

, 44 1 S .W.3d 612 , 621 (Te x. App.

— Houst on [1st D is t.] 2014, pe t. den ied )

. A tri al court abus es its discretion if it acts wi thout reference to a ny g u id ing rules or principles

— that i s, i f its act is a rbitrary or unreasonable

. Low v. H enr y , 221 S.W.3d 609,
61 4 (Te x. 2007); Ci re v. Cum mi ngs , 134 S. W.3d 83 5, 8 38

– 39 (Tex. 2004). As the par ties
cha l leng ing cap acity, the Defend ants had th e burden to pro v e Eve re s t ’ s lack of

c apacity. See Christ i Bay Temp le v. Gui deOne Specialty Mut. Ins. C o . , 33 0 S.W.3d 251 , 253 (Te x. 2010 ) ; An glo

- D utch P etrol eu

m , 441 S. W.3d at 6 21

. In Texas, “ a foreign fi ling entit y ” cann ot “ mai ntain an action, suit, or
pr o ceeding in a c o ur t of t his state
. . . on a cause of act i on that a rises out of the
transaction of b usiness i n this state unless the forei g n f iling en tit y is re gistered in

acc ord a nce with ” C ha pter 9 o f the Te xas B usi n e ss Organiza tions Code. T ex. Bu s. Orgs. C ode A nn . § 9 .0 5 1( b)

. F o reign LLCs must register under C h apter 9 t o transac t business in T e xas. Id. § 9.001( a )(1)

. The registrat ion of a f or e ign f iling entit y (other
th an a f ore i gn limi ted

- li ability pa rtn ers hip) “ is e ffe ctive wh en the applicati on filed
und e r [Business Or g an iza ti o n s C o de ] Chapter 4 take s effect. ” I d

. § 9

. 0 08(a). W ith exceptions not a pplicable her e , “ [ a] filing instr ument subm itt ed to the s ecret ar y of

stat e take s e f fect on filin g . ” Id. § 4.0 51. If the s e cre tary of state finds that the filing
i nstrument conf o rm s t o a pplicable code provisions and ru l es a nd th at “ all r equired
fees have be en paid , ” the secr etary of state must “ f ile the ins trumen t by acceptin g i t21 into th e filing sy stem adopt ed by the secre ta ry of stat e and assigning the instrume nt a date of fi l in g . ” Id

. § 4.0 02 (a).
B. Analysis
Ev e rest ’ s li ve pleadi ng stated that it wa s a Flo rida L L C do ing business in
Tarra nt C oun ty , T exas. The Defenda nts point ed to th is s tatement in t h eir ple a i n abate ment , to wh ich t hey also attached a s su pp orting ev id e nce (1) correspondence
from the Texas S e cretary o f State ’ s of fice st ating that its reco r ds ref lected tha t Ever e st

was not re g istere d to do bus iness he re and (2 ) Sullins ’ s d eposition t e stimony i n which
he sta te d tha t Everest was a Florid a c or p oration t ha t o p erated in T e xas. In resp o nse , Ev er est point ed out tha t the Business Orga n izations Code

ex pressly provides tha t speci fic a ctiviti es “ do not const itute trans action of bu s in e ss in

t hi s state , ” in cluding maintain ing a n action or su it , main t a i ni ng a bank account , and

“ transacti ng busin e ss in int erstate c ommer ce. ” Id. § 9. 2 51( 1), (3) , (9). Everest explain ed th at alt hough it did busine ss in Tar rant C o unty , “ [a]t all r el evant t i me s ” its prin cipal office and all its ad mi nis t ra tive fun c ti ons were b a sed out of Florida , and i ts busin e ss activi ties in T exas and Florid a involv e d i n terstate commerc e . Thus, Ev e rest argued , it wa s not required to register in Texas as a foreign L L C to mai nt ai n its suit

. But “ ou t of a n abunda nce of ca u t io n, i n order to avoid any a rgument over the m atter and [ to] avoid an y unnecess ary delay or abat e men t of this lawsuit , ” Ever es t file d w ith
th e s e cretary o f s tate on January 28 , 20 19, an “ A p plicat ion f or Regis trat ion of a
Forei gn L i mited Liability Co m p any , ” a long with the re quir ed fil ing fees

. As p roof,22 Ev er est provided a cop y o f its appl ication , w hich w as st amp ed “ RECEI VE D ” by t he

s ecretary of s tate , and a p rep ai d invoice fro m Au sti n

- bas ed Law yer ’ s Aid Ser vice , I n c.

r e flectin g that the service h ad fi l ed t he appl icatio n and paid the filing fees to the

secr etary o f state on Everes t ’ s b ehalf

. During the plea

- i n

- abateme nt hearing, the Defe ndant s ’ att or ne y argued that although Everest h ad filed i ts app lication , he h ad not “ received any c onfirmation from

t he Se cret a r y of State or

-- o r acceptance of t hat applicatio n. ” Everest ’ s atto rney

count ered that Ever est has t ake n “ st e ps to cure any a llege d de fe c t ” by filing the

r egistration appl i c ation along w it h al l req u ired f ees. The t rial court ruled from the
b e n ch , sta ting Well, for the time being, the p lea in abat e ment and the m otio n to d ismiss wi ll be den ied. I think that up unti l the time of jud gm ent it can be cu red

. So we ’ re goi n g to go ahead and p rocee d to trial, a nd if it ’ s not cured by the time judgment i s r ender ed, we will rev isi t the issue

. During t rial, Su l lins test ified that E ver est was “ licensed to operate in T e xas. ” The
D efendants re

- urged t heir capacity a rgu m ent i n t heir J NOV mo tio n . O n appeal, the Defendants as sert t hat b ecause Ev erest n ev er esta b lish ed t h at it had complied with Section 9 .051(b) ’ s reg ist ration requirement , i t fail e d t o e st a blis h i ts capaci ty to m ainta in suit and to recover under the judgment. Eve rest c ounters t hat it
did establish compliance but t ha t ev en if it didn ’ t , th e Defenda nts f aile d to preserve
their c apac ity complaint because they did no t ob jec t t o th e jury charge, which

assum ed that Ev er est had capacity t o sue. See Damian v. Bell Helicopter Te xtron , I nc

. ,23 352 S.W.3d 124 , 141

– 42 (Tex. Ap p.

— F ort Wort h 2011 , pet. denied ) (ex p lain ing t hat
when a defendant cha llenge s capa city though a verified denial , th e p lai n t if

f bears the
bu rd en o f proving a t t rial that it is enti t led to recover in the c apac ity in which it h as

sue d bu t that , to preserve a capa city complaint , the defendant mu s t ob ject t o jury questions that a ssum e the ca pa c ity p l eaded )

. But cf. Bossier Chrysl er D odg e I I, Inc. v. Rausch enber g

, 201 S .W. 3d 787 , 798 (T ex. App.

— Wa c o 2006) ( “ If a ver ified plea in
ab atement is fi led , t he fili ng par ty s hould seek a hearing on the plea. If the plea is

overru l ed, th en t he matter has bee n pres erved for app ell ate revie w . ” ) , rev ’ d in part on other g ro unds , 23 8 S .W.3 d 37 6 (Tex. 2007 )

.

Assum i ng that the Defendants have p reserv ed the ir c a paci t y com plaint fo r our review a nd that E v erest w a s required to r e gis ter to do business i n Texas to maintain

s uit, we conclude that the tr i al court d id n ot abuse its discre tio n by denyi ng the
Defen da nts ’ plea in abatement. The Defendants bore t he bur de n t o p r o ve that
Ever est lac ked capacity

. The Defend ants presente d e vi d ence t hat Evere st was n ot registered to cond uct business in Texas, and i n resp ons e, Ev erest pr es ent ed evid ence that it had submitted an applicati on to the secretar y of state and had p aid t h e requ i re d
fees

. See Tex . Bus. Or g s . Code Ann

. § 4. 051 ( stati n g th a t “ [ a] fi lin g inst rumen t submitted to the secre tary of state takes effect o n fili ng ” ); se e also id. § 4.0 02 (a ) (stating
th at t he secre tary of st at e “ shall ” file a filing instrumen t up on fin d in g th a t i t co nform s

to applicab le code prov isions and rules a nd that all requ i red fees h ave been paid). The
Defe ndants never brought for war d any evid enc e that Everest ’ s a ppli cation was no t in24 fact fi led b y the T e x as Secr etary of State . We thus conclud e t h a t the trial court d id not abuse its discret ion by denyin g t h e De fend ant s ’ ple a i n a batem e nt
. Add itionally , o n our own mo tio n and for the first time on ap p e a l we may take judi cial notice of a djudi cat ive facts tha t are matt ers of publi c recor d

. S e e Tex. R. Evid.
2 0 1 ; Rocksta r Re model ing & Diam ond Decks, LLC v. Tadd i a , N o. 03

- 19

- 00657

- CV,
2020 WL 1540740 , at *2 n.2 (Tex. App.

— Aus tin Apr. 1, 20 20, no pet
. ) ( mem. o p.). A

s earch of Ever est ’ s franchise

- tax

- account s tatu s on the Texas C omp troller ’ s we bs i te shows that Eve rest ’ s righ t to t ra ns ac t bu siness in Texas is “ acti v e ” an d that Everest ’ s effecti ve registration date with t he Tex as S ec retary o f S tate wa s J anuary 28, 20 19

. W e take judicia l notice of these facts s howing that Everest was in fac t r egis t ered to do
busine ss.
We overru le t he Defen dant s ’ second issu e . I V. Suf f

icien cy of the Evidence
The Defendants ’ third , fourt h , fi fth, and sixth iss ues c hallenge the sufficiency
of the evi dence supporting several of the jury ’ s findings . We address each is s ue in

turn.
A. Standard s of R e view
We may s usta in a legal

- suffici ency c h alle nge

— that is, a no

- eviden ce challenge

— only when (1) the record bea rs no e vid ence of a vital fact, (2) the rules of
law or of evidence bar the court fr om giving weight to the only e v idence offered to prove a vita l fa c t, (3) t he e vidence offered to prove a vi tal fact is no more than a mere25 scintilla, or (4) the evidence es tablish es conclusive ly the opposite of a vital fact. Shields
Ltd. P ’ ship v. Bradb erry , 526 S.W.3d 471, 480 (Tex

. 2017); see also Ford Motor Co. v

. Ca stillo , 44 4 S.W.3d 616, 620 (Tex. 2 01 4) (o p. on reh ’ g); Uniroyal G oodrich Tire Co. v. Martinez , 977 S.W. 2d 328, 33 4 (Tex. 19 98) (op. on reh ’ g). In determining whether legally sufficient ev idence supports the finding un d er review, we must consider
evide nc e favora ble to the finding if a reaso na ble f actfinder could and must disregard contrary evidence unless a reasona ble factfinde r could not. Cent. Ready Mix Concrete Co.
v. Islas , 228 S.W.3d 6 49, 651 (Tex. 2007); City of K e ller v. Wilson , 168 S.W.3d 802, 8 07 , 827 (T ex. 2005). We indulge “every re asona ble inference deducible from the evidence” in support of the c halleng ed finding. G unn v. McCoy , 554 S.W.3d 645,
658 (Tex. 2018)

. When reviewing an assertion that the evidence i s factually insufficient to
suppor t a findin g, w e set aside the fi nding o nl y if, after considering and w eighing all the pertinent record evide nce, we de termine th at the credible evidence supporting the finding is so weak, or s o contrary to the overwhelming weight of all the evidence, that
the findin g sh ould be set aside and a n ew tria l ordered. Pool v. Ford Motor Co. , 715 S.W.2d 629, 635 (Tex. 1 986) (o p. on reh ’ g); Cain v. Bain , 709 S.W.2d 175,
176 (Tex. 1986); Garza v. Alviar , 395 S.W.2d 821, 823 (Tex. 196 5 )

. B. Everest ’ s R eliance
In t hei r th ird is sue, the Defendants argue tha t no ev idence support s the jury ’ s f

raud and negligen t

- misrepr es e n tation finding s because Ev erest ’ s reliance on Grisel ’ s26 and Mo rrison ’ s alleged mi s rep rese ntations and om issi o ns was not act ual or justified

. Th e D efendan t s c on tend that because Sullin s and Poo n

— who a re experienced ,

s ophisti cated bu sinessm en

— rai sed an d ignore d mu ltiple “ re d f lag s , ” ju stifiable
reliance wa s n egated as a matter of law

. 1. Applicab l

e l aw To p r evail on its claims for fr aud by mi srepresentation , fra ud by non d is cl osu re, and negligent mi s repr esentation , Everest had to prove (among oth er things) tha t it

ac tually and justi fiab ly r elied on G r is el ’ s and M orrison ’ s mis represe ntations or omissions

. 12 See, e.g . , G ran t Tho rnton LLP v. Prospect High Incom e F un d , 314 S.W.3d 913,
923 (Tex. 2 0 10) ( op. on reh ’ g) ( sta t i ng t hat fr au d and negligent misre prese ntati on
requ ire a sh owi n g of a ctual an d j usti fiable r eliance) ; Sch l u

mb erger Tech. Co rp. v. Swa nson , 959 S.W.2d 171, 181 (T e x. 1997) ( explain ing that frau d by n ond isclosure is a
sub cat egor y of fr aud and that because re li anc e is an element of fraud, it is li kewis e a n

e lement of fr aud by non disclosure) ; BP Am. Prod. Co. v. Z af f

irin i , 419 S.W.3d 485 , 5 06 (Tex. App.

— San An t onio 2013, pet. denied ) ( stating that l ik e comm on

- law fraud,
frau d by n ondiscl osur e includes the eleme nt of justifi able reliance ). Justi fiab le re lia nce

12 The (uno b jected

- to) fra ud ques tion to the jury was a br oad

- fo rm questi on in whi ch th e jur y was instru cted that fraud included fraud by mi srepresen tation and fraud by nondisc losure. Th u s , the jury ’ s fraud findings against Grisel and Morrison could be based on e ithe r or both th eor ies.27 usually p res ents a fact question f or a jury to decide. 13 B a r row
- Sh aver Res

. Co. v. C arrizo
Oil & Gas, In c . , 590 S.W .3d 471, 497 (Tex. 2019) ( c iti n g JPMo rg an Chase Ba nk , N

. A. v. Orca A sset s G .P., L. L.C. , 546 S.W.3 d 6 48, 6 54 (Tex . 2018)). But the eleme nt can be

n eg ate d a s a leg al matter whe n c ircumstances exist un d e r whi ch reliance canno t b e justified. Orca As s ets , 546 S .W.3d at 654. “ R ed flags ” in dicat ing that reliance is

u n warrant ed is o n e such circumstance. See B arrow
- Sh aver Res

. , 5 90 S.W.3d at 50 1 (ci tin g Or ca Asse ts , 5 46 S. W.3d at 655 ).

13 W hen, as here, the court ’ s cha rg e is submitted to the j ury wi thout object ion, we measure the suffic iency o f the evidence a gainst the court ’ s charge. See Romero v

. KPH Consolidation, Inc. , 166 S.W.3d 212, 221 (Tex. 20 05) (citing Wal

- Mar t Stores, I nc. v. Stur ges , 52 S.W.3d 711, 715 (Tex. 2 001) )

. The cha rge track ed the Texas Pattern Jury Charges for fraud by misr epres e ntation , f raud by n o n d is clos ure, and negligent mi s representation

. See C omm. o n Pattern Jury Charges, Sta te Bar of Tex. , T ex as Pattern Jury Cha rge s: Busi ness , Consumer , Insura n c e & Emp loyment PJ C 10 5. 2, 105.4, 10 5.19 (201 8 )

. I n confor mity with the pat tern c harges, t h e f raud

- b y
- m isrepr ese ntatio n and fr aud

- by

no ndisclosure instructions did not exp l icitly instru ct the jury tha t Ev erest ’ s rel i anc e must have be en justifiable. Se e id

. PJ C 10 5 .2, 105 .4

. Never theless, we will assume without deciding tha t Evere st wa s required to prove t h a t its reliance was justifie d to prevail on its fraud claim. See Nelso n v. McCall M otors, Inc

. , 63 0 S. W.3d 141, 147

– 4 8 (Tex. App.

— Eastland 2020 , no pet. ) ( concl uding t hat althoug h the jury charge did not explic itly instruct the jury that t he plaintiff ’s relia nce must be just ifiable, the fraud instruction requiring the plaintiff t o prove reliance “nece s sari ly included the inquiry as to whether any reliance wa s justifiab l e ” and thus cons idering whether just ifiable reliance was negated as a legal ma tter (citing Ginn v. NC I B ldg. Sys

. , I n c. , 472 S.W .3d 802 , 8 29

– 31 (Tex. A p p.

— Hou s to n [1st D ist.] 201 5, no pet .) ) ) ; see also Lake v. Cravens , 488 S.W.3d 867, 895 (Te x . A p p.

— Fort Worth 2 016, no pe t. ) (op. on reh ’ g ) ( “ [R ] eliance i s a nec essary element of a statutory fraud cl a im , and we a ssume th at the reliance must have been j ustifia ble

. ” )

. But see Harst an, L t d. v. S i K yu Ki m , 441 S.W.3d 791, 799 (T ex. App.

— El Paso 2014 , no pet. ) ( ref us ing to consid er whet he r the r e was sufficient evidence of just ifiable relia nce when measuring the sufficiency of the evidence supp or ting a fraud finding because no part y com plained o f t he j ury charge ’s failure to re quir e th at the plaintiff ’ s reliance was ju stified ) ; Gho sh v. G rov e r , 4 12 S.W.3d 749, 756 (Te x. App.

— Hou ston [1 4th Dist.] 2013, no pet

. ) (same)

.28 “In m easuring justifiabi l it y , we must inquire whet her, ‘ given a fraud pl a inti ff ’ s ind ividu al characterist ics , abilit ie s, and appreciatio n of fac ts and ci rcumsta n ces a t or be fore the ti me of the al leged fraud[, ] it is e xtr emel y unlik el y t h at t here is actual
reli ance on the plainti f f

’ s par t. ’ ” G rant Thornto n , 31 4 S.W.3d at 923 ( q uoti ng H aral son v . E .F. Hutton G rp. , Inc. , 91 9 F.2d 1014, 1026 (5th Cir . 1990) ). In an arm ’ s

- length

trans action, a plaintiff must exer cise o rd ina r y care to pro tect its o wn interests

. Orca
Assets , 546 S.W.3d a t 6 5 4. Mere confi dence in the defe ndant ’ s hones t y and in tegri ty does not excuse a p la intiff ’ s fa ilure to exer ci se reaso nable d i l ig ence. Id. (citing Nat ’ l Prop. H oldings, L.P. v. Westergre n , 453 S. W.3d 419 , 4 25 (T ex. 2 015 ) )

. “ [ W ] hen a party
fai ls to e xercise su c h di ligence, it is ‘ ch arged with knowledge o f all fac ts that woul d
have been dis co ver ed by a reasonably pr udent pers on simi la rly situated

. ’ ” Id

. (quo ting
AK B Hend rick, LP v. Musgrave Ent er

s . , In c . , 380 S.W .3d 2 21 , 232 (T ex. App.

— Dallas 2012, no pet. ) ). A part y “ cann ot blind ly rel y on a representation by a def endant where the plaintiff ’ s kno wl edge, experience, and background w arra nt investigation i nto a ny
repr esentations before the plaintiff ac ts in re lian ce upon thos e rep resentations.” Id

. ( quoting Shafipour v . R isch on Dev. Corp

. , No. 11

- 13

- 00212

- CV, 2015 W L 3 454219, at
*8 (Tex. App.

— East lan d May 29 , 2015, pet. denied) (mem. o p.) )

. B ut “ [ o ] n e does not h ave to conduct an independent investigatio n or aud it t o justifiabl y re ly on another party ’ s false, material re pr e sent ation when the
mi srepresentations are no t ‘ outlandish, preposterous, or so p at ently a nd obviousl y false ’ that on e w ould have to close his o r her e yes to avoid discovering their29 fals eness . ” Spic e r v. Maxus Heal thcare Partners, LLC , 616 S.W.3d 59, 120 ( T ex. App.

— Fort Worth 2 020, no pet.) (op. on r e h ’ g) (qu oting Hannon, Inc. v. S cott , No. 02

- 10

- 000 12

- CV , 2011 WL 183310 6, at * 8 (Tex. App.

— F o rt Wo rth May 12, 2011, pet. denied) (mem. op.) )

. 2. Ana lysis
As the D efenda nts point out, S ullins and P oon are educated , experienced
busine ssme n : S ullins has a ba c he l or ’ s de gree in business man agement ; Poon has degrees in mathema tics and comp uter s ci ence, a law deg ree , and a business

management c ertifi cate. Both men hav e been in th e import business together since the early 2 00 0s and join tl y o wn Evere st, a busi ness that sources , manu factures, and ships p roducts g l ob ally.
As evidence of “ red fla gs ” neg a ting Ever e st ’ s ju stif iable r elian ce as a matter of
law , th e D efendants point t o two email ex changes that oc c urred in b etween Sul lins ’ s

t wo meetin gs wit h Grisel in March 2014

— the first email being betw een S ullins and Jennin g s and the second a mong Sullins, Poon, and J en n ings

. In the first , which
occurred i m m ediate ly after Sul lin s ’ s firs t meeting with Gri s el, Sul l ins wr o t e to Jennings to expr ess hi s frustration that CE owed Everest m oney and to let J e nnings
kn ow that Sull ins fe l t like Jennin gs had “ se t [him] up fo r an a mbus h ” because during

t he meeting , Gri sel had asked for a disc ount on the amounts CE ow e d Ever es t
. In
response, Jennings ass ur ed Sullins that Everest ’ s sharing th e cost of the brid ge loan
was Gri sel ’ s i dea and was not a “ premed i t ate d se t

- up to a mbush ” Sull ins

. Je nning s30 stated , “ I bel ieve the bes t chan ce for CE to survive [,] and i n short t erm t h rive, is to engage wit h [Gri sel ’ s] gr oup. I trust them completely. ” Because this exchange raised

no quest ions about Gr isel ’ s alleged assur a nces , it h as n o “ r ed f l ags. ” J u st be fo re Sullin s and Grisel ’ s second meeti n g , Sullins, Poon, and Jenn ing s exchanged emails

. Sullins stated that he had question s about a trade

- c red it pro gram that Grisel had me ntioned in th eir first meeting ; specif i cally , S ulli ns wanted an

e xpl a natio n of ho w the p r ogram worked and w ri tten proof tha t C E had been accepted into t he p rogram. For his part, Poo n was “ looking for s ome c oncrete

assu rances of pay ment ” and ha d concerns about Gri sel ’ s liquidity becau se Grisel “ di d

not seem to have the liq u i d cap ital th at a normal equity investor po ss ess e s whe n investing into a ventu re. As such , we may need to have lette rs of credit or sta n dby
letters of credit b efor e accepting and fulfilling orders for CE

. ” 14 J ennings res po n d ed
that he w as “ confi den t that we c a n g et this thing back on good fo ot ing and i nstill confidence by pay ing within agreed [

- ] to terms going fo rward ” and that he and Grisel

“ had come to a n agre e ment in princip al [sic] ” but that i t was “ d ependen t on finali zi ng

s tability wit h E verest. ” J enning s cont inued , On one hand yo u a r e loo king for assurances from [Grisel] and his group b ut on the other hand they ar e looking for assur ance s fro m Ev e r est. I am concerned that you are only looking from one p erspecti ve a nd n ot seein g that the y to [o] wil l have c a pital risk g oing fo rward a nd d o not know you any better th a n you know them

.

14

Accor ding to Poon, no repres entations wer e made directly to him , and S ullins had rela yed e v ery th i ng to h im.31 Jennings ended with, “ I am c onfident that if [S ullin s] w ill wo rk with [Grisel] to iron out all details, we can mo ve forward to al l parties [ ’ ] sa tisfaction

. ”
Re garding this second email excha n g e , Sull ins ’ s questions about th e trade

- credit
program are ir relevant because , as Sullins exp lained at t rial , “it turned out th at this was nothing that would have be nefi ted me anyway, so i t didn ’ t matt er. ” Afte r this exchange, Grisel and Sulli n s me t f or a s econd time, and as not ed, Grisel reiterated his
represe ntations f rom their fi rs t meetin g . Amon g them were (1) Grisel was going to bring in his group of “ exp e rts ” to turn CE around , and (2 ) Mo rrison was goi ng to immediately invest $500, 000 , s o m e of whi ch w ould be used to pay Eve rest
. And after
th is meeting b oth Grisel and Morrison continued to m ake assurances to Sullins , with
M orris on reaf firm ing Grisel ’ s representat ion that h e was Grisel ’ s bus iness p artn er and

“ was going t o bring the $ 5 00,000 i nto t his bus iness deal []

. ”
N o evide nce shows that Ever est asked for lett ers of credit or some other
confirm ation of Grisel ’ s or M or rison ’ s l iquidity

. Sullins testified that he did not be lieve
that a n y “ ch eating ” was in volve d or that he “ ne eded a wr itten a g reeme nt. ” He further

tes tified that he “ though t [Grisel ] was being honest with [ him ] ” and that Gri sel was

“ very persuasive and charismatic , and so I fe ll for the whole deal, hoo k, line, and
si n ke r, li ke an idiot

. ” Al th ough m ere confi dence in a defe ndant ’ s hones ty and integri ty does not excuse a p la intiff ’ s fa ilure to exer cise reasonable d i lig ence , see O rca Assets , 546 S.W.3d a t 6 5 4 , the jury could have found that Ev erest e xercised re a sona b le
dili genc e and was no t wi ll fu lly blind , for at least two reasons
. F irst , Jennin gs

— who32 had b e en working with Grisel for months and had d one business wi th Sul lin s fo r about 20 y ears

— told Sullins that he trusted Grisel ’ s group “ comp letely ” and believ ed

t hat it was the “ bes t chan ce for CE to s urvive

. ” Se co nd , Gr isel did obta i n the $500,0 00 sho rt ly after his second meeting with Sullins

— albe it through a loan to C

7 Dev elopment f rom Morrison ’ s friend rather than an invest men t from Mo rrison

— but Grise l wit hheld the funds from C E for three month s. In other word s, a ccess to funds wa s not an issu e; Gri se l had access to the funds but withheld them from CE

. And Morrison ass ured Sullins that the money was on its way

. Accordingly, viewing t he evidence in a l ight mo st favorable to the verd i ct, we hold t hat the evi dence wa s suffic ient for a reas o nable j ur y to find that Eve rest actually
and j ustifi ably relied on Gri s el ’ s and Morriso n ’ s mis r epresentations and omissions

. We
thus overrule the Defendants ’ third iss ue. C. M orrison ’ s F rau d and N egl igent M is repr esen t ation s In th ei r four th issue, t he Defendants chal l enge the sufficiency of the evidenc e supporting the jury ’ s fraud and negli ge nt

- m isrepresent a t ion findings against Mo rrison

. First , t he Defendants ar gue that Morrison ne ver made a false, material r epre s enta tion
to Ev ere st and nev er s upplie d false infor mati o n to Ev erest. Second, t he Defendants
contend that Morri so n had no legal duty to dis close material facts to Sullins but that
even i f he did, Morrison “ did no t know any of the f a cts relating to the $500 ,00 0 that
were d i s cussed b y Sull ins and Grisel duri ng t h e Mar ch 14, 2014 meeting

. ”33 1. F ra ud by mis re p

rese ntation a nd negligent misrepresentation
To rec over on its fraud clai m agai nst Morrison under a f rau d

- by

mis r e pr e s en t ation theory , E ver est had to pr ove , amon g o ther th i n gs, that Mo rriso n made a material , fa l se re pres en tation to Everest

. S ee Orca Ass e t s

, 54 6 S.W.3d at 653

. T o succeed on its negligent

- misrepresentation claim agains t Morrison, Everest ha d to
prove, among o t her things, that Mo rrison

— in t he c ourse of his bu s in es s or in a
transaction in which he h a d a p ecu ni ary interest

— suppli ed to Evere s t fa lse
in forma tion for guidance in a business transaction. See id

. The Defenda nts argue that
because M or rison had no cont a ct with Everest until a fter Sullins ’ s seco nd meeti ng

w

ith Gri sel, Morrison could n ot ha ve m a de an y mi s representations upo n which
Sullins r eli ed in de ciding to reopen credit with CE. The Defendant s th us co ntend t hat
the evidenc e is legally and factually i n suf ficient to s upport t he j ury ’ s fr au d

- by

misrepre se nt a t ion and neglige nt

- misre presentat ion f i ndin gs.
Her e, the e vide nce enable d th e ju ry to reasonably infer that Sullins continued extending c redit t o CE based on M orriso n ’ s r e presenta tions af t e r Sullins ’ s second meeting wit h Grisel

. Accordin g to Su llins , at s ome point a ft er that meeting , Mor riso n

r eaf firmed Grisel ’ s repr esentat ion s that Morrison “ was [G rise l ’ s] business partner in [HMC RT] , hi s fi nancial guy, hi s mon ey m an, who was going t o bring th e $ 500,000 i nto this bus ine ss deal[]. ” Whe n C E f ai led to make p romised payments to Everest, Sul l ins a ppro a ched Mo r riso n, who told him in Apr il or May 2014 that he did
not have the fund ing but w ould get it. Sullins al s o testified th at Grisel and M orrison34 “ tol d me many things tha t were n ’ t true and with the express inten t of asking me to

exte nd credit t o a c omp an y th at they were trying to pull a big, huge SBA loan out o f
so that they could skim money out of that loan

. ”
Viewi ng th i s evid ence in a ligh t most favorab le to the ve rdic t, th e evidence was
suffi cient for a reason abl e jury to conclude that Morris on m a d e re presentations on

w hich Everest relied in continuing to ext end credit t o CE , an d th e e vidence thus
suf f ic ed to support the jury ’ s fr a ud

- by

- mi sreprese nt ation and neg ligent

misre presentation f i nding s ag ainst Mo rrison . Likewise, considerin g an d w eigh in g a ll
th e evidence, the evidence supporting these findings is not so wea k that the f ind i ngs

are clearly wro n g and manifest ly unjust. We ove rr ule thi s part of the D efendant s ’
fo urth issue.
2. Fraud by non d

isclosure To pre vail on its fraud

- by

- n ond i sclosur e cl a im ag ainst Morrison , Everest had to
establish , among other thin gs, that Mo rrison fa il e d to disc lose mat e rial facts to
Everest t hat he ha d a d uty to d isclo se . S e e Bombar dier Aerospace Corp. v. SPEP Air c raft Holdings, LL C , 572 S.W.3d 213 , 219 (Te x. 2019 )

. T h e Def endant s argue for the first time on appeal that the evi den ce is l egally insuf fic ient to s upport th e jury ’ s fraud

- by

nondi sclosure fin di ng ag ainst Mo r rison because as a matter of law, he had n o du t y to dis close mat erial facts to Everest

.

“ As a gen eral rule, a failure to disclose information does not constitute fr aud
unle ss there is a d uty to di sclose t h e information.

. . . Whether such a d uty exists is a35 que stion of law. ” Bradford v. Vento , 48 S.W

. 3d 749, 755 (Tex. 2001 ) (citation s omi tted) ;

see al so Co mm. o n Pattern Jury Charg es, supra , PJ C 10 5. 4 cmt. ( explaining that failure

to

- di s closure instruction sh o uld accom pany com m on

- law fraud question “if the court
f inds that the re is a duty t o disclose ” )

. To p reserve th is ma tter

- of

- law issue for our
revie w , th e D efen dants we re re quire d to raise i t in the trial court through one or more
of t he foll owing method s: (1) a mot ion for d i rected verdict; (2) a JNOV motion ; ( 3) an objectio n to s ubmittin g the questio n to the jury; (4) a motion to disregard the jury ’ s answ er to a vital f act q uesti on; or ( 5) a new

- t rial motion. See , e . g. , T.O. Stanley
Bo ot Co. v. Bank of El P aso , 847 S.W.2d 2 1 8, 220 (Tex. 1992 ). Although t he Defend ants
ch a llenge d the suf ficiency of the evi dence to suppor t the jury ’ s fraud

- by

nondisclosu re fi ndin g, they n ever co mplai ned in the trial court that , as a legal matter,
Morris on ow ed Everest n o d ut y to dis close

. By not raising this legal issue in the tr ial

court , the D e fe nd ants failed to preserv e this argument fo r our review. See id. ; see also
T ex. R

. App. P. 33.1; Batt ag l ia v. Alexande r , 93 S.W.3d 132 , 140 (Tex. App.

— Houston [14th Dist. ] 2002), af f

’ d in part , rev ’ d in par t sub nom. Carl J. Battagl ia, M. D., P.A. v.
Al exa nd er

, 17 7 S.W.3d 893 (Tex. 2005 )

. The Defen dant s als o cha llenge the sufficie ncy o f the evidence su ppo rt i ng the
fraud

- by

- nond isclosure fi nding arguing that “ the reco rd con clusively e stabli s hed that
Morr iso n ha d no kn owledge relating t o [Gri sel and Sullin s ’ s ] a lleg ed ‘ agreemen t ’ (or its
terms or rela ted representat ions) and , thus , c ould no t be liable for fa ilin g to di sclose
information he did not have. ” But, as d escr ibed ab ove, Mo rr ison reaffir med Grisel ’ s36 representation s reg arding the quick inf usion of $ 50 0, 000 into CE

. M orrison adm itted
at trial tha t Grisel ’ s r eprese ntation th at M o rriso n would inve s t $500 , 000 i n CE was f

alse because Morri son was financia lly inc a pabl e of “ pu ttin g in money to ” CE “ as equity or a loan ” at th at t ime

. A nd M orrison knew that the funds were a loan from his
frie n d T hompson b ec ause he had arranged that l oan . And b ecause M orrison had

arra nged the loan , h e would have kn own that Grisel ha d already obtaine d the funds
but had no t pa id them to CE

. Even so, M o rrison failed to dis close this informa tion to
Everest.
V

iewing all th i s in a light mo s t favorab le to the ve rdict , th e evidence was

s uffic ie nt for a reasonable jur y to c onclude that Morrison failed to di sclose material
facts to Ever e s t , an d the evidence was thus sufficient to support t he jury ’ s fr aud

- by

nondiscl osure f i nding agai nst Mo rris o n . Likewi se, consider i ng an d w ei g h ing all the

e viden ce , the e vidence supporti ng thi s finding is not so weak that the finding is clear ly
wrong and m a nifest l y un just.
We overrule the rest of the Defen dants ’ fourth issue.
D. Con sp iracy At trial, Sullins e x pl ained that Everest ’ s cons piracy claim s invol v ed th e Defend an ts ’ use of the $500,00 0 “ loan ” to convince Ever est to re

- open credit to CE.
Th e jury found tha t each of t he Defendants had conspi red to d efraud Everest , and

t h eir fi fth issu e c halle ng es those findings

. S p e cifically, t he D efe ndants conten d th at37 th e evidence is insufficient t o support the specif ic

- int e nt a nd m eeti ng

- of

- the

- minds conspiracy eleme nts.
1. Applicable la w A civil

- co ns p iracy claim h as f i ve eleme nts: (1) a co mbination exists o f two or

mor e pers on s ; (2) th ose perso ns seek to accomplis h a n object or course of action; ( 3) t hose persons reach a meet i ng of the minds on the object or course of action; ( 4) one or more un lawfu l, overt acts are taken in p ursuance of th e object or course of action; and (5) t he plaintiff is d amage d as a proximat e res ult of the wrongful act

. First
United Pentecos tal Ch u r ch o f Beaumont v. Parker , 514 S.W.3d 214, 222 (Tex. 2017) (cit ing
Tri v. J.T.T. , 162 S.W

. 3d 552, 556 ( T ex. 2005) ). “ An a c tion able civil con spiracy
requ ires spe c if ic intent to ag ree to accomplish so methi ng unl awful or to accomplish something l awful by unl a w ful m eans. ” Id. ( citing ERI Consulting Eng ’ rs

, Inc. v. Sw inne a , 318 S.W. 3d 867 , 881 (Tex. 2010 ) ). This “ re q uires a m eetin g of the min d s on the object

o r cou rse of action. ” Id. ( ci ting Swinne a , 318 S.W.3 d at 881) . An actiona ble ci vil

con sp iracy claim thu s e x ist s “ only as to those parties w ho are aware of the intende d harm or prop osed wr ongful con duct at the ou t se t of the c omb ination or agreeme nt. ”
Id. ( citing Fires t one S te el Prods

. Co. v. Ba rajas , 92 7 S.W .2d 608, 614 (Tex. 19 96) ). Consp iracy is typically proved by cir cumstantial evidence

. Schl umberger Well
S urveying Corp. v. Nortex O il & Gas Corp

. , 435 S.W.2d 8 54 , 85 8 (Tex. 1 968 )

. “Circumstant ial evide nce may be used t o estab lish any materia l fact, b ut it must constitute more than mere suspicion.” Transp

. Ins

. C o . v . F aircloth , 898 S.W.2d 269,38 278 (Tex. 1995) ; see Browning

- Ferris, Inc

. v. Reyna , 865 S.W.2d 925, 927 (Tex. 1993) (“[S]ome suspicio n link ed to other suspic ion produ ces o nly more suspicion, which i s not the same as evidence.”); Schlumberger Well Surv eyin g Corp. , 43 5 S.W. 2 d at
85 8 ( stating that “vital facts may not be p roved by unreasonable infe rences from other
facts and circu m stances” and that any vital fact mu st be prove d “by e v idence

amoun ting to something more than a mere scintilla”). “When viewin g me ager circum stant i a l evide nce, if ‘ circumstances are consistent wit h either of two facts and
nothin g shows that one i s more pr o bable th an the other, neither fact can be
infe rred. ’ ” Transp

. Ins. , 898 S.W.2d at 278 (quoting $ 56,700 in U.S. Currency v. Sta te , 730 S.W.2 d 659, 662 (Te x. 1987)). Circumstantial evidence can inc lude the a lleged conspirators ’ ac ts or statements
. I nt ’ l Bankers Life Ins. Co. v. Holloway , 368 S.W.2d 567,
581 (Tex. 1963) (“T he ge neral rule is that conspiracy liability is sufficien tly estab lished by proo f showing concert of action or othe r fact s and circumsta nces from w hich the

nat ural inference arises that the unlawf ul , overt acts were committed in fu rthe r ance o f common desig n, in tention, or purpose of the alleged conspirators.”).
2
. A n

alysi s The D efendant s ar gue that no evidence show s that any of them knew th at the obje ct of their act i ons “ was to de f r aud Ever est into e xtend ing further credit to CE
wit h th e use o f the $500,000 loan and cause Everest to lose money ” and that no evid enc e es tablishes an y point in time “ at the outset of the agree ment ”

— tha t is,
Grise l and Sullins ’ s March 2 014 meeting s

— “ w hen a ll the allege d co

- conspirators39 reache d an agreemen t on a preco n ceived p lan t o def raud Everest and cause da mages. ” In short, t h e D efe n dants argu e that “ Ever e st failed to present evidenc e that each alleged conspi rator kn ew at th e beginning ab o ut so m e plan to def raud Everest i n connection with the $ 500,000 lo an , s pec ifically intended to d o it, and un derstood that
all the other s had a c omm o n purpose and plan. ”
T he first parag raph of the civil

- conspira cy instruction in the c harg e f o llowed the p attern jury charge , 15 but the second paragra ph permitted the j u ry to f ind a

con spiracy even if the p arty was not in on it from th e begi n nin g : To be par t of a conspiracy, an individual named be low an d another person or persons must have h ad kno w ledge of, agreed to, and intend ed a common object ive or c ours e of action t h at resu lted in the damages to Pl ainti ff. One or more persons invol ved in the consp iracy must have performed some act or acts to f urther the conspiracy. A party may join a c ons pir a cy already in pro gress and upon j oining the conspir acy, t he p arty becomes a party to ever y act previously
or subse quently committed by any of the o t her conspi rator s in pursuit of the conspiracy.
B eca use the Defendan ts d id not object to th e c harge, we must re view the evidentiary
suffi cienc y sup port ing the j ury ’ s civil

- c onspiracy fin dings i n lig ht of the charge
sub mitte d

. See R omero , 16 6 S.W.3d at 221

. Here, t he evidence showed that Grisel, with the intent to induc e Everest into

e x t ending additional credit to CE, represented to Sullins that Morrison woul d inf use $500, 000 into CE and that Gri sel a nd his team of exper ts we re goi ng to t u rn CE

15 S ee Co mm. o n Pattern Jury C harges, supra , P J C 10 9 .1.40 ar ound

. Grisel furth er r eprese nted that CE would use the $500 ,000 for tw o pur poses: (1) to pa y some of what it owed Everest and (2) to improve CE ’ s fin anci al s so that
CE cou ld s ecure more favorable terms on its already

- approve d SBA loan

. Acco rd ing

t o Su llins, Morrison reaffirmed G risel ’ s representat ion s that Morrison “ was [G ri se l ’ s ]
bus iness part n e r in [HMCRT] , hi s fi nancial guy, hi s money m an, who was going to bring the $ 500 ,0 0 0 into this bus iness deal[]. ” When CE f ai led to pay Eve rest as
pr omi s e d , Sullins approa ched Mo rrison, who told him in Apr il or May 2014 that he
did not ha v e the fundin g but would get it. Addit ionally, the jury heard Jennings ’ s

w r itten statement , which h is son re ad to th e jury, that “ Mo rriso n confirme d th at a
p revio us deal he was in with [Grisel] lost mon ey and this ( C E ) deal wa s a way to get [Morrison ’ s ] money ba ck. ” See Int ’ l Ba nk ers , 368 S.W.2d at 582 ( “ Infere nc es of

concer ted action m a y be drawn f rom jo int participation in the tr ansa cti on s and f rom

e njoyment of t he frui ts of the transaction s . . . . ” ) . The jury also heard evidence th at Grisel and Morrison s tarted meeting regardi ng CE i n March 2014. From this
evidence , a jury could r ea sonabl y conclude t hat Grisel a nd M orriso n agreed to work
tog eth er to convinc e Eve rest to extend credit to CE to keep C E in business long

en ough to secure the SBA loan, all the while skimming as m uch mo ney as possible
fro m CE in the form o f the ir monthly $1 0,000 consulting f ees. Viewing t he evid ence in a l i ght m ost fa vorable to the ve rd ic t, w e thus hold that

t h e evi d ence was sufficient for a reasonable jury to concl ude that Grisel and M orrison
knew about , agreed to, an d i ntended the common objective of defra ud ing Everest41 i nt o reop e nin g and into c ontin uing to exte nd cred it to CE with the pro mise of a qu ick $500 ,000 in fusion into CE , and the evi dence is thus sufficient to support the ju ry ’ s civil

- conspirac y fin dings ag ain st Gri sel and M orrison. Likewise, consid erin g and

w eigh in g all the evide nce, th e evi dence s uppor ting th ese findings is no t so weak that
the find ings ar e clearly w r ong and manifes t ly unjust. A nd because the jury was
instructed that corporate e ntities ac t t h rou gh their agents 16 and that a party cou ld join

a cons pi ra cy a lready in p rogres s , we conclu de th at the evidence was su ffi cient to
support the jury ’ s co nspiracy f i ndings as to HMC RT and Envis age.

16 Re garding the corp orate ent ities , the D e fendants a rgue that , as a l egal matter, a corpo ratio n cannot con spire with itself thr ough its agent. We agr ee that thi s correct ly stat es t he la w. See Te x. Integrate d Co nveyor Sys., Inc. v. Innovative Conv ey or Co ncepts, Inc. , 300 S.W.3 d 348, 381 (Tex . App.

— Dal las 2009, pet. denied) ( op. on reh ’ g) ( “ As a gener al rule, a corporation cannot conspire with itself throug h its age nts. ” ) ; s e e als o C

r

ouch v . Trinque , 262 S. W.3d 41 7, 427 (Tex. App.

— E as t land 2008, no pe t.) ; Fojtik v. First Na t ’ l B ank of Beeville , 752 S.W.2d 669, 673 (Tex. App.

— C orpus Christi 1988) , writ d

enied , 775 S.W.2d 632 (Tex. 1989). But i f an agent acts f or his own persona l gai n, r ather t han on be half of the co mpany, then the corpo ra tion can cons pi re wi th its age nt
. See Fojti k , 752 S.W.2d at 673 ; see a lso Te x.

– O hio G as, I n c

. v. Mecom , 28 S.W. 3 d 129, 138 (Tex. App.

— Texa rkana 2000 , no pet. ) ( agreeing that t h e law is that “ a c orpor ate agent ca n consp ire with its co rporation if the agen t is not acting i n his corporat e capacit y ” ). Even so, the De fendants di d not raise this matter

- of

- law point in the tria l court
. As noted, t o p reserve a matter

- of

- law issue for o u r re view , the Def e ndant s we re re quired to raise it in the trial court through one or more of th e fiv e methods we liste d pre viously

. Se e , e . g. , T.O. Stanley Boot Co. , 847 S .W.2d at 220

. Although the D efendants ch allenge d the evidentiary sufficiency to s u pport the jury ’ s consp irac y fi nding s , they failed to complai n in the trial court that , as a le gal mat ter , a corpor atio n can not conspire wi t h itse lf through its agents

. By n ot do ing s o, the D e fe ndants failed to preserve this argument for ou r review. See id.42 We likewise conclud e that the evidence wa s s u ffi cient as to C

- 7 Development

. Grisel testified that “ [ t]he m oney came fr om C [

- ] 7 Development Partners, wh ich w as me, which I took from my company and put into [ CE ] , ” and that h e be lieved that he
had “ personally ” invested $500,000 into CE

. We t hus co nclude that viewing the
evidence in the l ight mo st favor able to Ev erest, a reas onab le jury could hav e concluded that C

- 7 Development knew abou t , agre e d to, and intended the common objective of defraud ing Eve rest into reope nin g and into contin uing to ext end credit to
CE with the pro mise of a qu ick $500 ,000 infusi on i nto C E

. Like w ise, considerin g and

w eigh ing all the evide nce, the evidence su pport ing the conspiracy finding aga i n st C

7 Development is not so wea k that the find ing is clearly wrong and mani f est ly unjust

. W e c annot , however, so conclude about Barreras and her c ompany Cy ndex

. A l though both had a role in hol din g and transfer ring the $500 ,00 0, this is insufficient

t o pro ve that either of them knew about , a greed t o , and intended a common objecti v e that damaged Everest

. As noted, T hompson loaned the fund s to C

- 7 Deve lopment , and Grisel ex ecuted the pro m i s sory no te on C

- 7 D evelopment ’ s b ehalf

. B arreras testified that , a t G risel ’ s direction, she accepted the loan proce ed s from Thompson
into t he C

- 7 T ru st accoun t and t hen (1) d istr ibuted about $25,000 of the loan
pr oce ed s to Gr isel i n ca sh a nd (2) transfe r r ed about $18 ,0 00 of the loan proce eds i n t o Cyn d ex ’ s account

— which b elo ng ed to Barre ras and her husband

— to buy a car for her brother, Mo rri son. Gris e l later direc ted B arrera s to d istribute the r ema ining loan proceed s to C E , and in Ju ne 2014, Barrera s made two $200,0 00

- p l us tra n sfe rs from43 th e C

- 7 Tr ust a cco un t to th e Cy nd ex ac count
. Shor tly thereafter, Ba rreras pai d $15,000 from the Cy ndex account to C E , and lat er t hat month , she pa i d $4 41,000 from the C y n dex account to CE

. Barre r as te stified that alt hough she
receiv e d a n d deposited the $500, 0 00 l oan , made wi t hdrawal s and pa yme nts from the
C

- 7 T rust account, transferred funds from the C

- 7 T rust acc ount t o Cyndex ’ s

ac count, and issued checks from Cyndex ’ s account to CE, she did so at Gri sel ’ s direction , did not know any thi n g about the l oan, and did not know what happen ed to
th e m oney after she sent it to CE. And al though B a rreras incorp orated HMCR T in
M ay 2014 , designated C yn dex as HMCRT ’ s reg istered agent , and bri efly w ork ed as an indep e nde n t contractor for CE , this i s ins uf ficient to prove tha t B ar reras was in on
the conspiracy. Although b oth direct and circumstantial e v idence may be us ed to establ ish an y material fact , Ford Motor Co. v. Ri dgway , 135 S.W.3d 598, 601 (T ex. 2004) , a f act is

es t ablished by circumstantial evide nce w hen it can be f airly and reasonably inferred
from other facts proved in the case , Russell v. R u ssell , 865 S.W.2 d 929, 933 ( Tex. 1 993). But to withstand a legal

- suffic iency c hallenge, circumstanti al evidence still must

c onsist of more than a scin t illa. Blou nt v. Borde ns, Inc. , 910 S.W.2d 931, 933 (Tex. 1995)

. Here, the evidence of Barre ras ’ s and Cyn d ex ’ s involvement with the ot her de fendants
is cir cumstantial e vidence o f their participation in the co nspiracy, b ut it cann o t b e fairly and reasonably in fer red f rom that ev ide n ce th at Barrer as and Cyndex knew
about , agreed to, and intended a common object i ve or course of action to defraud44 Eve rest into re ope nin g and into c onti n uing t o extend credit to CE

. Accordingly, we

c onclude an d hold tha t while the e viden c e is legally and f a ctual ly sufficient to support the jury ’ s civil

- con spiracy findings against Gris e l, Mo rrison, HMCRT, Envis age, and
C

- 7 Development , th e re is n o evid ence to sup port the findings agai nst Barreras and
C y nd e x. We th us s usta in the D efen d ants ’ fifth issue in par t and overrule it i n part
. E. Exemplary D amages The Defend ants ’ sixth issue cha l lenges the jury ’ s aff i rmative answer to the
exemp lary

- damages predi cate questi on because “ neithe r ma lice, f raud, nor g ross negligence lawfully support [ s] an aw a rd of punitive d amage s. ” Concerning malice and gross negligence, the D efendants arg u e that Everest “ presented no e vidence, much
less clear an d convincin g e vide nce , ” to support a n affirmative answe r to the pre dicat e question based on e i ther malice o r gr oss neg ligence

. R e ga rding fraud, t he Defendants
contend that “ fraud could n o t prov ide a lawful predicate for any awar d of punitive
da mages ” becau se t he in s tructions defined fraud as including constru c tive fraud , which is not a prope r predic a te for exe mplar y damages under Chap ter 4 1 of the Texas
Civil Practice and R e medies Code. See Tex. Civ. Prac. & Rem. Code Ann. § § 41.001 ( 6) , . 003(a)( 1)

. We ad dress t he Defendant s ’ fraud

- related argument first
b ecause it is di spos i t ive of this i s sue. 1. Th e charge
Th e ju r y an swered “ yes ” to t he e xemplary

- damage s predicate question , w h ich
read as follows:45 An swer the following question only r elated to [ t he fra ud question
a s to G risel] or [the negligent

- misr epre sentation question as t o Gr isel] only if you una nim ously ans wered “ Yes ” to [ the fraud ques tion as to G risel] and/or [the neglige n t

- misr epre sentation q uestion ] as to Defendant Grisel . Oth erwise, do n ot ans wer the fol lo wing question.

. . . . Do you find by clear and conv incing e v idenc e that t h e harm, if
an y, found in [ the fraud question as t o G ri sel ] to Plaintiff Everest resulted f r om malice or fraud, o r the harm, if an y, found in [the
ne gligent

- mis r ep rese nta tion que st ion as to Gr isel ] resulted from gross negligence b y Defendant G risel ?

“ Clea r and convi nci ng eviden ce ” mean s the measure or deg re e o f proof that produces a firm belief or conviction of the truth of the allegations sought to b e establishe d

.

“ M ali ce ” mean s a specific intent by Defendant Grisel to cause subst antial inj u ry or h arm to Plaintiff Eve rest;

“ Fra ud ” is a s defined in [the fr aud q uestion]

.

“ Gross negligence ” mea n s an act or omission by Defendant Grisel, (a) which when viewed obje ct ivel y f rom the st andpoint of Defendan t Grisel at the time of its occurre nce inv o lves an ex tre m e degree o f r isk, considering the p robability and
ma gn itude of the potential harm to other s ; and (b) of which D efendant Grisel had actual, subjecti ve awareness o f th e r isk invo lv ed, but nevertheless proceeds with conscious indifferenc e to t h e rights, s af e ty, or wel far e of others.
The inst ructio ns accompanyin g the fraud question sta t ed that fraud occ urs when :

a. a party makes a material mi srepresentat io n, a nd46 b. the m isrepresentation is made with knowledge of its falsity or made reckle ssly wi t hout any k nowl edge of the truth and as a po sitiv e as sertion, and

c. the m isrepresentation is made with the inte ntion that it should be acted on by the other pa rt y, a nd d. the ot her party relies on the misrepresentation and thereby suffers i njury. T he in s tru ctions fu rther stated th at fraud also occ u rs wh en ,

a. a party fails to d isc l ose a material fact w ithin the knowledge of that party, a nd b. the p ar ty k now s that t he other party is ign orant of the fact and does not have an equa l opportuni ty t o disco ver the tru th; and

c. the party intends to i nduce t he ot her party to take so me ac t i on by fail i ng to disc lose the fact, and d. the other par ty suffers i nj ury as a result o f acting without knowledge of the undisclosed fact.
2
. Analy sis
T h e Defendan t s do n ot challenge the suf ficiency of the ev idence supporti ng an affirmative an s wer to th e predicate que stion base d on either fraud defin ition. They

ar gue, ho wever , that be ca use the charge included an inapp ropriate theory of

recov e ry

— fraud by n o ndisclosur e

— along w ith an appropriate theo r y of rec over y
— f

ra ud by misr epres entation

— fraud c an no t sup port Everest ’ s rec overy of exemplary47 damages

. 17 S ee id. § 41. 00 1 (6) ( “ ‘ Fraud ’ means fr aud other than constru c tive fraud. ” ) , § 41.003 (a)(1) ( p r o vi ding tha t f r aud is a g round for recovery of exemp lary damages) ; see al so Comm. o n Patte rn Jury Charges , sup ra , P JC 10 5 .4 cmt. ( not ing in comment accompanying fr aud

- by

- nondi s c l o s u re instruction t hat const ructive fraud ca nnot serve as a predicate for reco v er y of exempl a ry dam ages and that “ [a ]ccordingly, i f fraud is an underly ing theory o f lia bility as we ll a s a predi cate for recovery of exem plary damages, construc tive fraud s ho uld be submitted separa tely from intentional or statutory fra ud ” ) ; PJC 115.37 B c mt. (noting s a me in comm ent ac com panying

ex emplary

- damages predicate que stion and in struc tion ).
I f a br o ad

- f orm q uestion incorporat es both valid and invalid base s for liabil it y,

s uch co m mingling may result in harm ful erro r. See Crown Life Ins. Co. v. Cas t eel , 22 S.W.3d 378, 388 (Tex. 200 0) (op . on reh ’ g) ( h olding that “ when a trial court
sub mits a single br oad

- form liabil i ty q uesti on incorporating mu ltiple theories of liability, the error is harmf ul and a new trial is required when the appellate court
cannot determine w h ether the jury bas ed its verdict on an improperly s ubmitted
invalid t heor y ” )

. The supreme court has dete r mine d tha t the Caste e l harmf ul

- error analysis applies to b road

- form da m age s qu estions m ixing va lid and invalid elements of damages

. See Harris Cnty

. v . Smith , 96 S.W. 3 d 230, 23 2

– 35 (Tex. 2002) (extendin g

17 The Def endant s do not di sput e that malice and gros s ne glig en ce are appropriate g r oun ds fo r recov ery of exem plary dama ges here. See Tex. Civ. Pr ac. & Rem. Code Ann. § § 41.001 ( 7 ) , (11) , . 003(a) (2) , (a ) (3)

.48 Casteel ’ s reason ing to damages quest ions) ; see also B urb age v . Burbag e , 447 S.W.3d 249,
25 5 (Tex. 2014) (citing Smith for t he pr o position that “ broa d

- form damages questions ” that incor porate both vali d and invalid dama g es elem ents may res u lt in
harmful e rror ). But to pres erve such a co mplain t for appella te revi ew , a party must
raise a Casteel

- type objection to the charge

. Se e Bur ba

g

e , 447 S.W.3d at 2 5 6

. He re, we cannot possibly determine whether and t o what ext e n t the jur y ’ s

a f firmative an swer to the pre dicate ques tion wa s based on a fraud

- b y
- non disclosu re find i ng . See Smith , 96 S.W.3d at 23 4 (h olding that a sing le br oa d

- for m quest ion mixing
valid and invalid damages elements constitutes harmfu l error because an appellat e court cannot deter mine the extent to which th e ju ry ’ s damages award was based o n an invalid , or unsupport ed, element ). But b ecause the D efenda nts did not ob ject to the charge in th e trial court , t hey have failed to preserve this is s ue for our review and th us

cannot now comp lain about the charg e . 18 See Bur ba

ge , 447 S.W.3d at 2 5 6 ( “ [I]n
situations w here a party does not raise a C as

t e el

- type objection, t hat par ty sure ly cannot
raise a Casteel issue when i t failed to prese r ve a clai m of an in valid the ory of liab ility

18 C iting United Scaffolding , Inc. v. Lev i ne , 537 S.W.3d 463 (Tex

. 2017), the Defe nda nts contend that th ey were n ’ t requ ired to object to t he ch arge an d preserved th eir compla int by raising it in th eir JNO V m otion. In Levine , the supreme court d etermi n ed that when “ the wrong theo ry of r ec over y was submitted and th e correct theory of reco very was omit ted ent irely, t he defendant has n o obl igati on to object

. ” Id. at 4 81. The court held that the ap pellant had pre served e rror by raising the argument in a J N OV motion. Id. at 482 . Here, however , there were multiple c orrect ex emp lary

- damage t heor ies

— fraud by misrepr esentation , malice, and gr oss n e gl ig ence

— submitt ed in the predicate question . We thus conclu de that Levine does not a pply.49 that forms t h e bas is of a C asteel

- type error. ” ) ; see also Tex. R

. A p p
. P. 33.1 ; Tex. R. Ci v. P. 274. An d because th e Defe ndants have not cha l lenged the suf ficiency of the evidence supporting the j ury ’ s affir mat i v e answer to the exempl ary

- d amages pred icate question b as e d on f raud , we thus overrule the ir sixth issue.
V. I ncur able J ury Argume nt
I n their seve nth issue , t he Def endants contend t hat Everes t ’ s cou nsel engaged in incurable jury argument by suggesting d u ring clos ing that Grisel sho uld not be
b elieved and was un tru stwor thy bec ause he had invoke d his C h ristian re li gi o us beliefs

to per suade the jury th at he was “ p iou s a nd good. ” T he Defe nd ants argue that these

“ statements

— part icularly when coupled with o ther c omments

— were of such a

nature , degree, and e xtent that a n instruction f rom the [ trial ] co urt or a retract ion
could not remove the ir pr e judicial effects ” on the De fendants

. A. Everest ’ s J u ry A rgument
The Defendants complain that d u r ing closi ng arg ument, Everest ’ s counsel
refer red to the D efend an ts as “ c rooks, ” “ frau d s, ” and “ liars ” and ac cused them o f

“ crookery, ” “ snookering , ” and l yi n g t o the j ury during “ every day of t he tri a l

. ” T h e Defendants further co m plain abo ut this part of Everest ’ s closing argument: Well, I wonder what [the Defe nda nts] thought that prov ed this morning , having you c ome back fro m last Frida y to hear this one w

i tnes s , some lawyer in Fort Worth that they were headed down a b usiness p ath with that

-- that Gr isel had directed hi m to his go od friend Simcho, a convicted fel on, and they had this

-- the lawyer a bout to go in busi ness wit h him.50 [Gris el and the Fo rt Wort h law yer] met at a Bible study. Where have we heard the inject i on of rel igion injec ted for your benefit? And you see it all the time in jury trials where some s ancti monious defe ndant caught in fraud will say: We ll, I go to Bible s tudy.

“ I know the day tha t Chri st is retu rning, ” do you remember that testimony? That

- - that was when Mike Jennings, in his statement, said and [his so n] Kris Jennings said: That ’ s wh e n I kn ew that thi s guy J oe Grisel was a fraud. He t old us throu gh his numerol ogy he knew the day Chris t would re turn. [ 19 ]

19 Ac cording to Jennings ’ s written statement rea d into e vidence at trial by his son, Jennings and Grisel “ had a cas ual ly mutual agreeme nt that re ligion and busi n ess c ould mix , ” but th at Jennings later learned , “ as we spent signi ficant amounts of time to gether, that [Grisel ’ s] spiritual opinions were ext reme an d it som etimes led to uncomfortable conversations that i nc lu ded [Grisel ’ s ] claim ing that h e was cert ain of t he time when Christ was go ing to return
. ” Regarding Gr isel ’ s involv emen t at CE, Jennin gs ’ s son , who also worked at CE, testi fied that he too bec ame a s keptic : T h ere were two family members that I saw as p r oba bly carr yi ng som e deadweight t hat I kind of felt li ke, o ka y, finally , we ’ re getting a consulting firm in here, which usually a consulting firm will co me in and there ’ s no more family bi asness, so som e things c ould get cleaned up. And when I saw Joe bei n g m ore budd i ed up with my uncle t hat didn ’ t really do anyth in g , it was more of a kissi ng

- up game to my dad to keep the con on as long as he could to dra in as much money as he could.
And th en when he wa s doing h i s numerology on the white board in my dad ’ s o ffi ce claim i ng tha t he knew the e xact day and time Jes us wa s g oi ng to r eturn, I

-- I

- - I was pretty much just done at that point

. So to answer th e que stion, it was the dragging on of clai ming to be a consulting group and t hen not

-- not being that at all def initely dr ained the last bit o f life, of possible t urnar ou nd or some value that my d ad could have had in the company, could hav e kept on throug h a per centage of it, but bleeding it that dry le ft hi m no choice but to lose it completely.51 It is a sad travesty when frauds and c rooks are willing to call the
nam e of religion and the name of C hrist into a jury to make you bel ie ve t hat somehow they ’ r e pious and goo d people. Th ey are not. At no point d u ring E vere st ’ s closi ng ar gument did the Defendants object or request

an instru ction to d i sregard Evere st ’ s counsel ’ s comments or argu ment. Instead, they
moved for a n ew trial, arguing o nly postjudgment t hat the jury ar guments were
incu r a ble.
B. Appl icable law
Control of couns el ’ s con du ct during jury argument rests in th e trial c ourt ’ s sound di scretion

. Wells v. HCA Health Servs. of Tex., Inc. , 806 S.W.2d 8 50, 854 (Tex. App

. — Fort Worth 19 90, writ denied); see Tex. R. Civ . P. 269. The te st for i mproper jury a rgument is whether t he ar gumen t could have persuaded a juror of o rdinary
i ntelligence to agree to a verdict contrary to that to which he woul d have agree d but for the arg ument. See Phil lips v. Bramlett , 288 S.W.3d 876, 883 (Tex. 2009)

. Reas on able
in ference s and deductions fro m the evid ence are allowed in closing argumen t, as is hyperbole. In r e I.C. , No. 02

- 15

- 00300

- CV, 2016 WL 1394539, at *18 (Tex. App.

— F ort Worth Apr. 28 , 2016, no pet. ) (per curiam) (me m. op.)

. Revers al i s require d o nl y wh en the en tire re cord shows that (1) the a rgume nt was improper, uninvited,
unprovo ked, and incurable by in structio n, withdrawal, or trial

- court reprimand and

J ennings ’ s son f u rth er t estified tha t he agreed wi th Jen ning s ’ s wr itten stat ement that “ [d] ue to [Grisel ’ s] g ross misrepr esentations and fraudulent beh avior, I lost the business that I b uilt ov er the past 43 years o f my business care er
. ”52 (2) the comp laint about the a rgument was pre served. See Standa rd Fire Ins. Co . v. Reese , 584 S. W.2d 8 35, 839 (Tex. 1979 ). Further, an a ppell ant m ust show that the argument
constitu ted harm f ul error by its nature, degree, and extent. Id. The party seeking

r eversal base d on an allegedly improper argum ent must show that the probabilit y th at the impro pe r ar gu ment ca used ha rm i s greater than t he pr obabi lity that the verdict was grounded on the p r oper proceeding s and ev idence. Id. at 840

. Ordinarily, a complaint regarding im proper jury argum ent must be pre served by a timely objection that is overruled. L iving Ct rs. of Tex., I nc. v. Peñalver , 256 S.W. 3d
67 8, 680 (Tex. 2008). But in rare cas es, an i m proper jury arg ument is considered incurable, and a contemporaneous trial objec tion is not requi red; a party ma y preserve the arg ument for appea l by raising it in a m ot ion for new tr ial. See id. ; see al so Te x. R. Civ. P. 324(b)(5); Gen. Motors Cor p. v. Ir a cheta , 161 S.W

. 3d 462, 472 (Tex. 2005) (holding that plaintiff ’ s pe rsonally add ressing the all

- H ispanic jury in Spanish during
he r lawyer ’ s clos ing argument to th ank th e juror s on be half of her deceased daug hter and deceased grandchildren was erro r that c o uld not be rep a ired and therefore did not need to be objected to).
C
. Analysis
Because the Defe ndants did not object, they must show that Ever est ’ s jury
argume n t was i ncurabl e. See PopCap Games, Inc. v. Mu mboJumbo, LL C , 350 S.W.3d 699 , 721 (Tex. App.

— Dal l as 2011, pet. d enied )

. Inc urable jury argument occurs when

comments ar e so infl ammatory that an instruction to disregard cannot cure their53 harm ful n ature. Colum b ia Me d. Ctr. o f Las Colinas v. Bush , 122 S.W. 3d 835, 8 62 (Tex. App.

— Fort Worth 2003, p et. deni e d). The test fo r incurability is whether the argument strikes at a court ’ s impa rtiality, equalit y, and fairnes s and, if not corr ec te d,
inflicts d amage beyond the p artie s and t he ind ividual case under c onsid eratio n. Peñalver , 256 S.W.3d at 681

. E xa mples of incurable jury arguments include appeals to racial prejudice, extreme unsupported perso nal attacks on parties or witnes ses, and

un foun ded ac cusations of manip u la ting a w itn ess . See id. ; PopCap Game s , 350 S.W.3d at
721 ; se e a lso Cottman Tr ansmission S ys., L.L.C. v. FVLR Ente r s . , L.L.C

. , 295 S.W .3d 372 , 38 0 (Tex. App.

— D allas 2009, pet. denied ) ( recogn izing that incurable arg ument can
inclu d e unsup por ted charges of p erjury and inf lammator y epithet s suc h as “l iar , ”
“fra ud , ” and “ cheat ”)

. But s ee Clark v. Bres , 217 S.W.3d 501, 510 (Tex. App.

— Houston [ 14th D ist.] 2006, pet s . denied) ( concluding that jury a rgumen t referring to par ty “ as a liar, a cheat, a thief, and a fra ud was not error or im proper be cause the argument
dis cuss ed ma t ters in eviden ce ” ).
But i ncura ble jury argument is rare

. Peñalver , 25 6 S.W.3d at 6 8 1. As the p arties claiming incu rable harm, the De fendant s must s how that , ba sed on the re c ord as a whole, the offensive argument s c ould have pers uaded a juror of ordinary i ntelligence

to agree to a verdict contrary to that to which he would h ave agreed bu t for the
argumen t
. See Phillips , 288 S.W.3d at 883

. He re, Everes t ’ s stat emen ts are reas o nable
i nferences and deductions from the ev idenc e, see I. C. , 2 016 WL 139453 9, a t *18 ; Clark , 217 S. W. 3d at 510 , a nd , al thou gh personal attacks on the parties , are supported54 by the evidence , see Peñalver , 25 6 S.W.3d at 6 8 1

. We thus cannot sa y, after vie win g th e

e ntire record , t hat thos e argume nts co uld have persu aded a juror of or dinary
in telligence t o agre e to a verdict contrary to that to which he would have agreed but for the argu ment
. S ee P h illips , 288 S.W.3d at 883

. Acc ordingly, we ov err ule the
Defe nda nts ’ se venth issue.
VI
. Jo int and Seve ral Li ability
The D efend ants argue in their ei ghth issue t hat if we reverse the jury ’ s conspiracy fin dings against G risel and Morrison but not the fraud a nd negligent

misr e p resentati o n findings against them, we sho uld nev erthel ess revers e the judgment

aga inst t hem because Ev erest failed to se c ure a p r op ortionate

- respon sibility finding

. See Tex. Civ. Prac. & Rem Code Ann. § § 33.002(a)(1), .013( b)(1). But b ecause w e have

c onc luded that th e eviden ce is suff icient to s uppo rt the conspiracy find ings against
Gri sel and M orrison, we n e ed no t addres s the Def endants ’ eig ht h is sue . See Tex. R

. App. P. 47 .1

. VII. Co nclusion
H aving sustained t he Defendan t s ’ fifth issue as t o the jury ’ s conspiracy findings

ag a inst B arrer a s and Cyn dex bec ause the eviden ce is leg ally in sufficient to supp ort

t ho se findin gs, we rever se the trial court ’ s judgment as to Barreras and Cyndex and
order that Everest take nothing aga i nst them. Hav ing ov errul ed the Defendant s ’ disp os itive is sue s, we a ffirm the rest o f the trial cou rt ’ s judg ment.55 /s/ Elizabeth Kerr E li zabet h K err Justi ce Deli ver ed: March 10, 2022