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IN THE UNITED STATES BANKRUPTCY COURT 

NORTHERN DISTRICT OF TEXAS

FORT WORTH DIVISION

IN RE BENHAM ORTHODONTICS & § Case No. 24-42784-elm11

ASSOCIATES, P.A, § Chapter 11

§

Debtor, §

------------------------------------------------------------- § ---------------------------------------------

FIVE POINT DENTAL SPECIALISTS, INC., §

FPDS BENHAM SUB, LLC, and BENHAM §

ORTHODONTICS, P.A., §

§

Plaintiffs §

§

v. §

§

ADAM BENHAM, DDS, MS, BENHAM §

PROPERTY OWNERS ASSOCIATION, § Adv. No. 24-04068

LLC, BENHAM ORTHODONTICS & §

ASSOCIATES, P.A. §

§

 Defendants. §

MEMORANDUM OPINION 

[Application for Temporary Restraining Order]

INTRODUCTION 

This adversary proceeding involves a dispute between Five Point Dental Specialists, Inc. 

(“Five Point”) and certain of its affiliates, on the one hand, and Adam Benham, DDS, MS 

United States Bankruptcy Judge

Signed August 27, 2024

______________________________________________________________________

The following constitutes the ruling of the court and has the force and effect therein described.

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(“Benham”) and certain of his affiliates, on the other hand, arising out of the sale of Benham’s 

orthodontic practice (the “Practice”) to Five Point in 2020. 

Prior to the August 7, 2024 (the “Petition Date”), the Five Point Parties1 and Benham 

Parties2

 were engaged in litigation in Texas state court under Cause No. 471-02575-2024 (the 

“State Court Case”) in the 471st Judicial District Court of Collin County, Texas (the “State 

Court”). On the Petition Date, the Benham Debtor, a Texas professional association organized by 

Benham on or about April 24, 2024:3 (a) filed a petition for voluntary relief under chapter 11 of 

the United States Bankruptcy Code, thereby initiating Case No. 24-42784 with this Court (the 

“Bankruptcy Case”);4

 and (b) filed a Notice of Removal with the United States District Court for 

the Eastern District of Texas (the “EDTX District Court”) to remove all of the claims in the State 

Court Case to the EDTX District Court, thereby initiating Civil Action No. 4:24-CV-00705 with 

the EDTX District Court (the “EDTX Case”).5

 On August 13, 2024, the Benham Debtor then filed 

an unopposed motion to transfer the EDTX Case to this Court.6

Notwithstanding the issuance of certain pretrial injunctive relief in favor of the Five Point 

Parties in the State Court Case, the removal of all claims from the State Court Case to the EDTX 

District Court, and the impending transfer of the EDTX Case to this Court, on August 15, 2024, 

the Five Point Parties (the Plaintiffs herein) initiated the above-captioned adversary proceeding 

with the filing of their Original Complaint and Emergency Application for Temporary Restraining 

1

 The “Five Point Parties” are Five Point, FPDS Benham Sub, LLC (“Benham SubCo”), and Benham Orthodontics, 

P.A. (“Benham Ortho”). The Five Point Parties are the Plaintiffs in this adversary proceeding and, thus, are also 

sometimes collectively referred to as the “Plaintiffs” herein.

2

 The “Benham Parties” are Benham, Benham Property Owners Association, LLC (“BPOA”), and Benham 

Orthodontics & Associates, P.A. (the “Benham Debtor”). The Benham Parties are the Defendants in this adversary 

proceeding and, thus, are also sometimes collectively referred to as the “Defendants” herein.

3 See Plaintiffs’ Exh. 2G (Certificate of Formation for the Benham Debtor). 

4 See Bankruptcy Case, Docket No. 1. 

5 See EDTX Case, Docket No. 1. 

6 See EDTX Case, Docket No. 5. 

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Order, Preliminary Injunction and Permanent Injunction [Docket No. 1] (the “Complaint”) 

against the Benham Parties (the Defendants herein). Shortly thereafter, on August 20, 2024, the 

EDTX District Court entered an order transferring the EDTX Case to this Court.7 As of the date 

and time of the entry of this Memorandum Opinion, a new adversary proceeding has yet to be 

opened in this Court to receive the transferred EDTX Case. However, once the transferred EDTX 

Case is docketed with this Court as a new adversary proceeding, the Court intends to consolidate 

the new adversary proceeding with the above-captioned adversary proceeding for all purposes. 

In the meantime, pursuant to the Complaint, the Plaintiffs have asserted the following 

claims against the Defendants: 

Count 1 – Trespass (against all of the Defendants) 

Count 2 – Assault8

 (against all of the Defendants) 

Count 3 – Breach of the APA (against Benham) 

Count 4 – Breach of the Employment Agreement (against Benham) 

Count 5 – Tortious Interference with Existing and Prospective Contracts and Business 

Relationships (against Benham and the Benham Debtor) 

Count 6 – Tortious Interference with Existing Contracts (against the Benham Debtor and 

BPOA) 

Count 7 – Violation of Delaware Uniform Trade Secrets Act (against Benham and the 

Benham Debtor) 

Count 8 – Constructive Trust & Accounting (against all of the Defendants) 

Count 9 – Conversion (against Benham and the Benham Debtor) 

Count 10 – Objection to Discharge 11 U.S.C. § 523(a)(6) (against the Benham Debtor) 

The Plaintiffs have also included a request for the entry of a temporary restraining order (the “TRO 

Application”)9

 and a request for issuance of a preliminary and permanent injunction against all of 

the Defendants. 

7 See EDTX Case, Docket No. 6. 

8

 Described in the Complaint as “Threats of Bodily Assault or Injury”. 

9 See Complaint ¶¶ 144-152. 

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 On August 16, 2024, the Plaintiffs filed a motion for an expedited hearing on the TRO 

Application, which the Court granted, setting a hearing for August 20, 2024, at 1:30 p.m. (CT). 

Notice of the hearing was provided by Plaintiffs to each of the Defendants on August 19, 2024. 

 On August 20, 2024, the Court commenced the evidentiary TRO hearing. Each of the 

Plaintiffs and Defendants appeared by and through counsel, and one or more witnesses were called 

for each of the parties. Because the hearing did not conclude by the end of the day on August 20, 

2024, the Court continued the evidentiary hearing to August 21, 2024, at 1:30 p.m. (CT). Once 

again, because the hearing did not conclude by the end of the day on August 21, 2024, the Court 

continued the hearing to August 22, 2024, at 9:30 a.m. (CT). On August 22, 2024, the Court 

resumed and concluded the hearing. 

 Having now reviewed the Complaint, including the TRO Application, reviewed the 

responses to the TRO Application filed by Benham and the Benham Debtor,10 reviewed the 

entirety of the record in this adversary proceeding and the EDTX Case, and considered the 

evidence presented and the representations and arguments of counsel, the Court issues the 

following findings and conclusions, determining that the TRO Application should be granted in 

part, and denied in part, as detailed below:11

10 See Docket Nos. 8 and 15. 

11 To the extent any of the following findings of fact are more appropriately categorized as conclusions of law or 

include any conclusions of law, they should be deemed as such, and to the extent that any of the following conclusions 

of law are more appropriately categorized as findings of fact or include findings of fact, they should be deemed as 

such. Additionally, the Court makes the following factual findings based upon the evidentiary record established at 

the TRO hearing. Given the expedited nature of the proceeding and the limited notice provided, such findings are 

preliminary only and shall not be conclusively binding upon the parties in connection with any future proceedings, 

including, without limitation, the temporary injunction hearing and the final trial on the merits. 

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JURISDICTION AND REFERRAL AUTHORITY 

A. Subject Matter Jurisdiction 

Bankruptcy jurisdiction is dictated by 28 U.S.C. § 1334.12 “28 U.S.C. § 1334(b) grants 

jurisdiction to district courts and adjunct bankruptcy courts [pursuant to 28 U.S.C. § 157(a)] to 

entertain proceedings ‘arising under,’ ‘arising in a case under,’ or ‘related to’ a case under Title 11 

of the United States Code....”13 The most remote of these alternative bases is “related to” 

jurisdiction. Thus, for purposes of determining whether bankruptcy jurisdiction exists with respect 

to a proceeding involving a particular claim, it is necessary only to determine whether the 

proceeding involving the claim is at least “related to” the associated bankruptcy case.14

The Fifth Circuit has explained that “related to” is a term of art in bankruptcy jurisdiction.15 

“‘Related to’ jurisdiction includes any litigation where the outcome could alter, positively or 

negatively, the debtor’s rights, liabilities, options, or freedom of action or could influence the 

administration of the bankrupt estate.”16

B. Referral Authority 

Where bankruptcy jurisdiction of a proceeding involving a claim exists, the district court 

may refer the proceeding to the bankruptcy court for further disposition pursuant to 28 U.S.C. § 

12 See 28 U.S.C. § 1334 (jurisdictional provisions with respect to bankruptcy cases and proceedings). 

13 Bass v. Denney (In re Bass), 171 F.3d 1016, 1022 (5th Cir. 1999). 

14 Walker v. Cadle Co. (In re Walker), 51 F.3d 562, 569 (5th Cir. 1995); Wood v. Wood (In re Wood), 825 F.2d 90, 93 

(5th Cir. 1987). 

15 Bass, 171 F.3d at 1022. 

16 Collins v. Sidharthan (In r KSRP, Ltd.), 809 F.3d 263, 266 (5th Cir. 2015) (quoting Lone Star Fund V (U.S.), L.P. v. 

Barclays Bank PLC, 594 F.3d 383, 386 (5th Cir. 2010) (quoting Edge Petroleum Operating Co. v. GPR Holdings, LLC 

(In re TXNB Internal Case), 483 F.3d 292, 298 (5th Cir.), cert. denied, 552 U.S. 1022 (2007))). 

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15717. That said, there is one limitation. Section 157 provides that the district court must order 

that “personal injury tort and wrongful death claims shall be tried in the district court....”18

The United States District Court for the Northern District of Texas (the “NDTX District 

Court”) has entered Miscellaneous Order No. 33 (the “Order of Reference”) to provide for the 

automatic referral to this Court of all bankruptcy cases and all proceedings arising under the 

Bankruptcy Code or arising in or related to a bankruptcy case, subject to the personal 

injury/wrongful death claim limitation. In the case of personal injury and wrongful death claims, 

the Order of Reference clearly provides that such claims are excluded from the automatic referral.19

C. Analysis of Jurisdiction and Referral Authority Over Plaintiffs’ Claims 

While, for efficiency, the Plaintiffs have permissibly initiated this adversary proceeding 

directly with this Court instead of with the NDTX District Court, the ability of this Court to 

exercise jurisdiction with respect to each particular claim asserted pursuant to the Complaint is 

dependent upon both the existence of bankruptcy jurisdiction under 28 U.S.C. § 1334 and referral 

authority pursuant to the Order of Reference. 

With the foregoing in mind, the Court makes the following jurisdictional determinations 

with respect to the claims asserted by the Plaintiffs pursuant to the Complaint: 

Claims Against the Benham Debtor. The easiest analysis relates to those claims that the 

Plaintiffs have asserted against the Benham Debtor. Not only are those claims “related to” the 

Bankruptcy Case, inasmuch as the outcome will necessarily alter, positively or negatively, the 

Benham Debtor’s rights, liabilities, options, or freedom of action and will influence the 

administration of the Benham Debtor’s bankrupt estate, they are core in nature as provided in 28 

U.S.C. § 157(b)(2)(B). Therefore, bankruptcy jurisdiction exists with respect to each of the claims 

asserted against the Benham Debtor. 

17 See 28 U.S.C. § 157(a). 

18 See 28 U.S.C. § 157(b)(5). 

19 See Order of Reference (“In accordance with 28 U.S.C. Section 157(b)(5), it is further ORDERED that all personal 

injury tort and wrongful death claims arising in or related to a case under Title 11 pending in this court shall be tried 

in, or as determined by, this court and shall not be referred by this order”) (emphasis added). 

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Claims Against Benham. Next, with respect to Benham, a non-debtor Defendant, the 

analysis is slightly more complex. Favoring jurisdiction is the critical nature of Benham’s 

relationship to the Benham Debtor. In particular, the Benham Debtor’s ability to operate is 

inherently dependent upon the ability of Benham to provide orthodontic patient care services 

through the Benham Debtor. Thus, to the extent that the outcome of litigation involving any of 

the Plaintiffs’ claims against Benham could impact Benham’s ability to provide such orthodontic 

patient care services through the Benham Debtor, then “related to” jurisdiction exists because the 

outcome of the litigation could correspondingly alter, positively or negatively, the Benham 

Debtor’s rights, liabilities, options, or freedom of action and could influence administration of the 

Benham Debtor’s bankrupt estate. Accordingly, bankruptcy jurisdiction exists with respect to each 

of Counts 1, 3, 4, 5, 6, 7 and 9, to the extent asserted against Benham. 

 In the case of Count 2, on the other hand, the outcome of the litigation of such claim against 

Benham will have no conceivable impact upon the Benham Debtor or its bankruptcy estate. The 

impact will be personal to Benham. Consequently, bankruptcy jurisdiction does not exist with 

respect to Count 2, to the extent asserted against Benham. 

 Finally, in the case of Count 8, the “claim” asserted thereby is not really a cause of action 

per se, but rather a request for relief tied to certain of the other claims. Thus, for simplicity and 

brevity, because Count 8 conceivably has a connection to Counts 3, 4 and 9, bankruptcy 

jurisdiction also exists with respect to Count 8, to the extent asserted against Benham. 

Claims Against BPOA. Finally, with respect to BPOA, another non-debtor Defendant, 

there is effectively no bankruptcy connection upon which to find jurisdiction. As alleged by the 

Plaintiffs in the Complaint, BPOA, a limited liability company wholly owned by Benham, is the 

owner of certain real property leased to Five Point. Nowhere within the Complaint is there an 

allegation suggesting that the outcome of the litigation of any claims against BPOA could have 

any impact upon the Benham Debtor’s operations, the Benham Debtor’s bankruptcy estate, or 

administration of the Bankruptcy Case. Consequently, bankruptcy jurisdiction does not exist with 

respect to Counts 1, 2, 6 and 8, to the extent asserted against BPOA. 

 Turning next to referral authority, with the exception of Count 2 (Assault), all of the 

Plaintiffs’ claims for which bankruptcy jurisdiction has been found to exist (as indicated above) 

have been referred to this Court pursuant to the Order of Reference. In the case of Count 2, 

however, while bankruptcy jurisdiction exists (to the extent asserted against the Benham Debtor), 

because assault is a type of personal injury tort, the Count 2 claim has not been referred to this 

Court pursuant to the Order of Reference. Therefore, the Court cannot and will not take any action 

with respect to such claim in connection with ruling on the TRO Application. 

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FACTUAL BACKGROUND

Benham and Jeremy Lustig, DDS, MS (“Lustig”) are both practicing orthodontists in north 

Texas. Upon completing his orthodontic education, Benham worked with Lustig for a period of 

time in Lustig’s practice. During that time, Benham came to look up to Lustig as a mentor. 

In or about 2008, Benham set up his own orthodontic practice (the “Practice”) under 

Benham Orthodontics, P.A., and he operated the Practice under the name “Benham Orthodontics.” 

Over a period of years, Benham successfully turned his Practice and Benham Ortho into a 

profitable enterprise. This enabled him to, among other things, acquire certain real property in 

Frisco and McKinney through BPOA, another of his entities, and then move the Frisco and 

McKinney orthodontic operations to the office space owned by BPOA – specifically, 4060 Legacy 

Drive, Suite 303, Frisco, Texas 76034 (the “Frisco Location”) and 5341 W. University Drive, 

Suite 200, McKinney, Texas 75071 (the “McKinney Location”). 

For purposes of this Order, at all relevant times Benham Ortho’s Frisco office was located 

at the Frisco Location and Benham Ortho’s McKinney office was located at the McKinney 

Location. Prior to Benham’s sale of his Practice, Benham was the only orthodontist who worked 

at those locations. 

A. Benham Agrees to Sell His Practice to Five Point 

Separately, Lustig and Andrew Young, DDS (“Young”), another practicing orthodontist in 

north Texas, established a combined orthodontics practice that they operate under the Five Point 

umbrella. In or about April 2019, Lustig approached Benham with the idea of bringing Benham 

into the Five Point fold by way of Five Point’s acquisition of Benham’s Practice, with Benham to 

thereafter continue to work in the Practice and have an equity stake in the acquiring entity. 

Eventually, after several months of continuing communications with respect to the prospect, 

Benham agreed to the idea and the process began to document the transaction. 

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Ultimately, the following (among other) documents were executed by the parties to 

consummate the transaction (collectively, the “Transactional Documents”): 

The APA. Five Point and Benham SubCo, as the “Buyers,” and Benham Ortho and 

Benham, as “Sellers,” entered into an Asset Purchase and Contribution Agreement, 

dated as of January 1, 2020 (the “APA”), to memorialize the Five Point Parties’ 

acquisition of the Practice and Benham’s go-forward joint ownership of Benham 

SubCo.20

The Escrow Agreement. Five Point, as the “Buyer,” Benham, as the “Owner,” and 

Capstar Bank, as the “Escrow Agent,” entered into an Escrow Agreement, dated 

January 1, 2020 (the “Escrow Agreement”), to memorialize the parties’ agreement 

with respect to how the Escrow Amount of the Purchase Price under the APA would 

be disbursed.21

The STA. Lustig and Young, as “Purchasers,” and Benham, as “Seller,” entered 

into a Share Transfer Agreement, dated January 1, 2020 (the “STA”), to 

memorialize Benham’s agreement to transfer his ownership of Benham Ortho to 

Lustig and Young.22

The Employment Agreement. Benham Ortho, as “Employer,” and Benham, as 

“Orthodontist,” entered into an Orthodontist Employment Agreement, dated as of 

January 1, 2020 (the “Employment Agreement”), to memorialize Benham Ortho’s 

employment of Benham and the terms thereof.23

The Frisco Location Lease. BPOA, as “Landlord,” and Five Point, as “Tenant,” 

entered into a Lease, dated as of January 1, 2020 (the “Frisco Location Lease”), 

pursuant to which BPOA leased the Frisco Location to Five Point.24

The McKinney Location Lease. BPOA, as “Landlord,” and Five Point, as “Tenant,” 

entered into a Lease, dated as of January 1, 2020 (the “McKinney Location 

Lease”), pursuant to which BPOA leased the McKinney Location to Five Point. 

B. The Transaction Closes 

On or about January 1, 2020, the transaction contemplated by the Transactional Documents 

closed. Pursuant to the APA, in exchange for a Purchase Price of $5.0 million (discussed further 

20 See Plaintiffs’ Exh. 2A (APA). 

21 See Plaintiffs’ Exh. 2A, at App. 45-54 (Escrow Agreement). 

22 See Plaintiffs’ Exh. 2BB (STA). 

23 See Plaintiffs’ Exh. 2C (Employment Agreement). 

24 See Plaintiffs’ Exh. D. 

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below): (a) Benham SubCo purchased all of the Purchased Assets from Benham Ortho, free and 

clear of all liens and encumbrances;25 (b) Benham contributed, transferred, and assigned to 

Benham SubCo all of his Personal Goodwill in and related to the Practice, free and clear of all 

liens and encumbrances;26 and (c) Benham SubCo assumed the Assumed Contract Liabilities and 

Assumed Trade Payables of Benham Ortho.27 Separately, pursuant to the STA, Lustig and Young 

purchased all of Benham’s ownership interests in Benham Ortho and Benham entered into a longterm employment relationship with Benham Ortho pursuant to the Employment Agreement 

(discussed further below). 

In relation to the $5.0 million Purchase Price, before executing the APA, Benham 

apparently believed that he would simply be receiving $5.0 million in cash upon closing. Given 

the complexity of the transaction, however, particularly the mechanics of financially transitioning 

the business aspects of the Practice to Benham SubCo and then providing Benham with an 

ownership interest in Benham SubCo, it was not that simple. Thus, the APA provided detail with 

respect to how the Purchase Price would be applied. Specifically, pursuant to section 2.1 of the 

APA, the Purchase Price was to be paid (or credited) in the following manner: (a) $1,334,782.47 

in the form of the issuance of the Rollover Units in Benham SubCo to Benham;28 (b) payment of 

25 See APA § 1.1 and Exh. A (defining “Purchased Assets” as “all of the Acquired Assets other than the Personal 

Goodwill”; defining “Acquired Assets” as “all of the assets, properties, rights and interests of [Benham Ortho] (and, 

with respect to the Personal Goodwill, of [Benham]), whether real, personal or mixed, tangible or intangible, and all 

of [Benham Ortho’s] rights, title and interest therein and thereto (other than and excluding the Excluded Assets), 

including but not limited [additional asset descriptions provided]”; and providing additional definitions for “Personal 

Goodwill” and “Excluded Assets”). 

26 See APA § 1.2 and Exh. A (defining “Personal Goodwill” as “personal and ongoing business relationships, contacts, 

reputation, know-how, operational processes and other personal goodwill with respect to the Practice and its 

operations”). 

27 See APA § 1.3 (defining “Assume Contract Liabilities” and “Assumed Trade Payables” therein). 

28 See APA §§ 1.2 and 2.1(a). The “Rollover Units” are defined as 490 Class A Units in Benham SubCo, which 

represented a 49% membership interest in the company.

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the Closing Indebtedness and Transaction Expenses to those to whom such expenses were owed;29

(c) payment of the Escrow Amount to the Escrow Agent, to be held, invested and distributed by 

the Escrow Agent pursuant to the Escrow Agreement;30 and (d) payment to Benham of the Closing 

Payment (equal to the Purchase Price, less the agreed-upon value of the Rollover Units (i.e., 

$1,334,782.47), less the Closing Indebtedness, less the Transaction Expenses, less the Escrow 

Amount, and subject to a net working capital adjustment (i.e., either (i) plus the amount, if any, by 

which the Estimated Net Working Capital exceeds the Target Net Working Capital, or (ii) less the 

amount, if any, by which the Target Net Working Capital exceeds the Estimated Net Working 

Capital).31 In executing the APA, Benham agreed to this allocation and the structure and terms of 

the transaction. 

In connection with the closing, Five Point provided a funds flow/sources and uses 

spreadsheet to Behnam (the “Closing Statement”).32 According to the Closing Statement, the 

Purchase Price was allocated as follows: 

29 See APA § 2.1(b) and Exh. A (defining “Closing Indebtedness” as “all outstanding Indebtedness (i) of or guaranteed 

by [Benham Ortho] and/or (ii) secured by or encumbering [the] Practice or any of the Acquired Assets or Professional 

Assets or their proceeds or substitutions, in each case as of immediately prior to the Closing, but excluding any Current 

Liabilities”; and defining “Transaction Expenses” as “all fees, costs and expenses incurred by Sellers in connection 

with [the APA], the Closing or the other agreements and documents and transactions contemplated [in the APA], 

including any and all fees, costs and expenses of brokers, investment bankers, attorneys, accountants, financial 

advisors, appraisers and other advisors and professionals, and any bonuses, severance, change of control payments 

and other amounts payable by Sellers in connection with the transactions contemplated [in the APA] and associated 

payroll or other Taxes, in each case that are unpaid as of immediately prior to the Closing”). 

30 See APA § 2.1(c) and Exh. A (defining “Escrow Amount” as the “Indemnity Escrow Amount, Overpayment Escrow 

Amount, and the Working Capital Escrow Amount”; and defining “Indemnity Escrow Amount” as “an amount equal 

to $500,000”, “Overpayment Escrow Amount” as “an amount equal to $205,157.28”, and “Working Capital Escrow 

Amount” as “an amount of cash equal to $100,000”; see also Escrow Agreement § 1.3 (providing conditions under 

which such amounts are to be disbursed). 

31 See APA §§ 2.1(d) and 2.2(a) (defining “Estimated Net Working Capital”) and Exh. A (defining “Target Net Working 

Capital”). 

32 See Defendants’ Exh. 10. 

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 Purchase Price $5,000,000.00 

 Issuance of Benham SubCo Rollover Units (1,334,782.47) 

 Payoff of Closing Indebtedness (630,052.15) 

 Payoff of Transaction Expenses (32,656.00) 

 Payment of Escrow Amount to Escrow Agent 

 Indemnity Escrow Amount (500,000.00) 

 Overpayment Escrow Amount (205,157.28) 

 Working Capital Escrow Amount (100,000.00) 

 Closing Payment to Benham (2,197,352.10) 

 Remaining Balance 0.00 

In relation to same, Benham acknowledges that he received the SubCo Rollover Units and the 

Closing Payment upon closing, and that since the closing he has also received the full amount of 

the Indemnity Escrow Amount and the Working Capital Escrow Amount from the Escrow Agent. 

It appears that the Overpayment Escrow Amount (referred to as the “Escheat Escrow” in the 

Closing Statement) has yet to be disbursed to anyone by the Escrow Agent. 

In relation to the payoff of Transaction Expenses (i.e., the $32,656.00 payment to Dykema 

per the Closing Statement), while Benham now takes issue with any payment to Dykema based 

upon his claim that Dykema was either not his counsel or had a conflict of interest, no evidence 

was presented of Benham having timely disputed the payment in accordance with the dispute 

resolution procedures of the APA.33

C. Additional Post-Closing Income Generation Opportunities 

 As indicated above, following the closing Benham would continue to provide orthodontic 

services to patients through Benham Ortho and would participate in the financial upside of the 

transferred Practice by virtue of his ownership interest in Benham SubCo (i.e., the Rollover Units, 

representing a 49% membership interest in Benham SubCo). Additionally, Benham would 

indirectly obtain the benefit of rental income through BPOA on account of Five Point’s lease of 

the offices at the Frisco Location and McKinney Location from BPOA. 

33 See APA § 2.2(b). 

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In relation to Benham’s continuing provision of services, pursuant to the Employment 

Agreement, Benham Ortho and Benham agreed34 that Benham Ortho would employ Benham 

during the Term (defined as a period ending on the later of 5 years after the Effective Date or 2 

years after a Company Sale or FPDS Liquidity Event (each as defined in Benham SubCo’s 

Restated Limited Liability Company Agreement), with the opportunity for automatic successive 

renewal terms of 2 years each, in each case subject to certain earlier termination rights), and would 

pay Benham an annual salary of $250,000.35 Additionally, Benham Ortho would provide certain 

benefits to Benham, including professional liability insurance coverage and Leave Time (defined 

as time away from the office for sick leave, vacation, and attendance at relevant professional 

meetings and continuing education as necessary for Benham’s professional advancement), 

provided the taking of Leave Time did not impair the business of the Practice.36

Separately, in connection with the issuance of the Rollover Units in Benham SubCo to 

Benham, to further incentivize Benham to grow the Practice post-closing, the APA provided for 

Benham to also receive an Earnout Amount in exchange for his contribution, transfer, and 

assignment of his Personal Goodwill to Benham SubCo.37 With respect to same, section 2.4 of 

34 Of note, Lustig and Young were to acquire all of Benham’s equity interests in Benham Ortho at the time of the 

closing, which they did, see Plaintiffs’ Exh. 2BB; and Benham was to then immediately resign from his positions of 

control with Benham Ortho, which he did, see Plaintiffs’ Exh. 2B. With that in mind, Benham highlights the fact that 

he executed the Employment Agreement both on behalf of Benham Ortho and in his individual capacity, see Plaintiffs’ 

Exh. 2C, and now suggests that the Employment Agreement is unenforceable because it was never validly executed 

by Benham Ortho due to his resignation. Such argument lacks merit and smacks of bad faith. Pursuant to section 

3.2(d), the Sellers (i.e., Benham and the pre-closing Benham Ortho) were required to deliver to Five Point at closing 

both the Employment Agreement duly executed by Benham and the resignation letter. Thus, the parties clearly 

contemplated that the Employment Agreement would be executed prior to the closing and the effectiveness of the 

resignation and, hence, at a time at which Benham Ortho was still under the control of Benham. Even if that were not 

the case, Benham acknowledged that he signed the agreement in his individual capacity, the actions of Benham Ortho 

since the closing clearly evidence Benham Ortho’s ratification of the agreement, and both of the parties conducted 

their affairs post-closing under the terms of the Employment Agreement. 

35 See Employment Agreement §§ 1.1, 2.1 and 3.1. 

36 See Employment Agreement §§ 2.1, 2.2 and 2.3. 

37 See APA § 1.2. 

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the APA sets out the standards for becoming entitled to an earn-out payment, the applicable 

determination dates, the reporting to be provided, and the payment amounts required. In short, the 

earn-out provisions entitled Benham to receive certain amounts tied to an evaluation of whether 

the EBIDTA of Benham SubCo for each particular Earn-Out Period exceeded the Baseline 

EBITDA Threshold of Benham Ortho for the 12-month period ending on the date of the closing.38 

Importantly, the APA specified that the maximum amount payable as the Earnout Amount was 

$1.4 million.39 While Benham takes issue with the timeliness of the reporting provided to him, he 

acknowledges that he has been paid the $1.4 million maximum.40

D. The Non-Compete, Non-Solicitation, Non-Interference, and Non-Disclosure 

 Protections of the APA and Employment Agreement 

 Within the service industry (which includes dental and orthodontic practices for purposes 

of this discussion), it is customary for the purchaser of a competitor’s business to require the 

inclusion of certain post-closing protective provisions within the transactional agreements to 

ensure that the seller is not able to turn around after the closing and engage in business activities 

that compete with the very same business that the seller just sold to the purchaser. Similarly, it is 

customary for employers within the service industry to require their key employees to agree to 

non-compete, as well as non-disclosure and non-disparagement, protections upon the termination 

38 See APA § 2.4(a). 

39 Id.

40 Benham claims that Benham SubCo has impermissibly caused the paid Earnout Amount to be treated as debt on 

Benham SubCo’s balance sheet, thereby impairing the value of Benham’s equity interest in Benham SubCo because 

the debt impairs Benham SubCo’s ability to make equity distributions. He asserts that that is not what the parties 

agreed to under the terms of the APA, pointing to section 2.4(b) of the APA. While the Court is not convinced that 

section 2.4(b) prevents Benham SubCo from financing its payment of the Earnout Amount, see, e.g., APA § 2.5 

(making it clear that the Earnout Amount is to be treated as part of the consideration payable by Benham SubCo to 

Benham in exchange for Benham’s transfer of the Personal Goodwill to Benham SubCo), the Court does find the 

language of section 2.4(b) to be awkward, at best. See APA § 2.4(b)(1) (“The Earn-Out Amounts are, and at all times 

shall remain, an unsecured obligation of Buyer”) (emphasis added); see also APA introductory paragraph (defining 

“Buyer” as Five Point). While it is possible that at some later date the Court may permit the introduction of extrinsic 

evidence with respect to the parties’ intent with respect to APA § 2.4(b), for current purposes the Court does not find 

this question to rise to the level of a possible material breach of the APA that would excuse Benham’s performance. 

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of employment. Five Point has followed suit, providing for such protections within both the APA 

and the Employment Agreement. 

1. APA Protections 

 First, in the case of the APA, article 7 includes a variety of restrictive covenants designed 

to protect the Five Point Parties and the Practice post-closing. Pursuant to section 7.2, for example, 

Benham agreed to be bound by the following protective provisions for a period of 5 years 

immediately following the Closing (the “APA Restricted Period”) (i.e., through January 1, 

2025):41

• § 7.2(a)(A) – proximity non-compete provision with respect to the provision of 

professional services (e.g., orthodontic, dental, corrective aligner, and similar services) 

(precluding activity within a 20-mile radius from the Frisco Location and the McKinney 

Location). 

• § 7.2(a)(B) – proximity non-compete provision with respect to the provision of nonprofessional, business-related services to an orthodontic, corrective aligner, or dental 

practice or orthodontist, dentist, or dental professional (e.g., management, marketing, and 

other business-related services) (precluding activity within the entire State of Texas and 

within a 20-mile radius from any location at which Five Point, any of its affiliates, and any 

“Supported Practice” is operating or, to Benham’s knowledge, has taken affirmative steps 

to begin operating at any time during the APA Restricted Period). 

• § 7.2(b) – non-interference, non-solicitation provision with respect to employees and 

independent contractors of Five Point, Benham SubCo, its affiliates, the Practice, or 

Benham Ortho. 

• § 7.2(c)(i) – non-interference, non-solicitation provision with respect to patients of the 

Practice or Benham Ortho or any of their dentists or orthodontists. 

• § 7.2(c)(ii) – non-interference, non-solicitation provision with respect to customers, 

clients, referral sources, payors, suppliers, vendors, consultants, and other persons having 

a business or professional relationship with the Practice, Five Point, or Benham Ortho. 

• § 7.2(d) – non-interference provision with respect to business relationships and contracts 

between Five Point, Benham SubCo, the Practice, Benham Ortho, or any of their affiliates, 

on the one hand, and any provider, customer, client, patient, potential customer, client or 

patient, employer, referral source, payor, supplier, vendor, consultant, employee, 

independent contractor or other person having a business relationship with Five Point, 

Benham SubCo, the Practice, Benham Ortho or any of their affiliates, on the other hand. 

41 See APA § 7.2. But see also APA § 7.4 (providing for an extension of the APA Restricted Period in the event of a 

breach of any of the negative covenants). 

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• 7.2(e) – non-disparagement provision with respect to Five Point, Benham SubCo, the 

Practice, Benham Ortho, their affiliates, or the “Supported Practices.” 

Separately, pursuant to section 7.3 of the APA, Benham agreed indefinitely to be bound to certain 

non-disclosure requirements with respect to any trade secrets or confidential or proprietary 

information of or regarding Five Point, Benham SubCo, the Practice, Benham Ortho or other 

practices supported by Five Point or its affiliates or their affiliates.42 Collectively, all of the abovedescribed protections are referred to as the “APA Protections.” 

In relation to the APA Protections, Benham agreed that in the event of an actual or 

threatened breach of any of them: (a) Five Point and Benham SubCo shall be entitled to seek 

injunctive relief; (b) Benham waives any requirement on the part of Five Point or Benham SubCo 

to prove actual damages or irreparable harm; (c) Benham waives the requirement of a posting of a 

bond; and (d) the existence of any claim or cause of action against Five Point, Benham SubCo, the 

Practice, Benham Ortho, or any of their affiliates, whether predicated on the APA or otherwise, 

will not constitute a defense to the enforcement by Five Point of the provisions of article 7 of the 

APA, “which will be enforceable notwithstanding the existence of any such breach.”43

2. Employment Agreement Protections 

 Next, in the case of the Employment Agreement, article 4 similarly includes a variety of 

restrictive covenants designed to protect Benham Ortho, Benham SubCo, and the Practice postclosing. Pursuant to section 4.2 of the Employment Agreement, Benham agreed to be bound by 

the following protective provisions for a period of 2 years following the expiration or termination 

42 See APA § 7.3. 

43 See APA § 7.4. 

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of the Employment Agreement (by any means and regardless of reason) (the “EA Restricted 

Period”):44

• § 4.2(a) – proximity non-compete provision with respect to the provision of professional 

services (e.g., dental and orthodontic services and related goods and services) or nonprofessional, business-related services to any dentist, orthodontist, dental practice, or 

dental entity (e.g., management, marketing, and other business-related services) 

(precluding activity within a 20-mile radius from each facility, office, or center at which 

Benham Ortho is operating or has taken affirmative steps to develop or begin operating at 

any time during the Term). 

• § 4.2(b) – non-interference, non-solicitation provision with respect to employees and 

independent contractors of Benham Ortho or Benham SubCo. 

• § 4.2(c)(i) – non-interference, non-solicitation provision with respect to patients of 

Benham Ortho or any of its dentists or orthodontists. 

• § 4.2(c)(ii) – non-interference, non-solicitation provision with respect to customers, 

clients, referral sources, payors, suppliers, vendors, consultants, and other persons having 

a business or professional relationship with Benham Ortho or Benham SubCo. 

• § 4.2(d) – non-interference provision with respect to business relationships and contracts 

between Benham Ortho or Benham SubCo, on the one hand, and any dentist, orthodontist, 

provider, patient, customer, client, referral source, payor, supplier, vendor, consultant, 

employee, independent contractor or other person having a business or professional 

relationship with Benham Ortho or Benham SubCo, on the other hand. 

• 4.2(d) – non-disparagement provision with respect to Benham Ortho, the Practice, its 

providers, or Benham SubCo. 

Additionally, pursuant to section 4.3 of the Employment Agreement, Benham agreed indefinitely 

to be bound to the following: (a) certain non-disclosure requirements with respect to Confidential 

Information (as defined in the Employment Agreement);45 and (b) a prohibition against Benham’s 

direct or indirect use of, or practice or operation under, the name “Benham Orthodontics” or any 

44 See Employment Agreement § 4.2. But see also Employment Agreement § 4.4 (providing for an extension of the 

EA Restricted Period in the event of a breach of any of the negative covenants). 

45 Pursuant to section 1.2 of the Employment Agreement, Benham also agreed that all case records, case histories, xray films, patient lists, accounting and financial records, examination reports, clinical photographs, films, and personal 

and regular files concerning Benham Ortho or patients of Benham Ortho shall belong to and remain the property of 

Benham Ortho, and that Benham shall not remove any of such records or other documentation at any time, including 

upon the termination of employment. See Employment Agreement § 1.2.

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variants thereof.46 Collectively, all of the above-described protections are referred to as the “EA 

Protections.” 

In relation to the EA Protections, Benham agreed to the following: (a) that a breach of any 

the covenants would cause irreparable damage and injury to Benham Ortho for which there is no 

adequate remedy at law; (b) that in the event of an actual or threatened breach of any of the 

protections, Benham waives and agrees not to assert any defense to the effect that Benham Ortho 

has an adequate remedy at law; (c) that in the event of an actual or threatened breach of any of the 

protections, Benham Ortho may obtain a restraining order and injunction against Benham without 

the necessity of posting a bond; and (d) that the existence of any claim or cause of action of Benham 

against Benham Ortho, whether predicated on the Employment Agreement or otherwise, will not 

constitute a defense to the enforcement by Benham Ortho of the provisions of article 4 of the 

Employment Agreement.47

E. The Souring of the Business Relationship 

 While it is not entirely clear how or why the relationship between Benham, on the one 

hand, and the Five Point Parties and Lustig and Young, on the other, soured so dramatically, it 

appears that the relationship began to run into serious trouble by as early as just a year after the 

closing based upon missed expectations on the part of Benham as to how much he would receive 

at the closing and thereafter make under the new Five Point umbrella. Among other things, it 

appears that some portion of Benham’s 2020 salary may not have been fully paid in 2020.48 Things 

only got worse thereafter when Benham faced unexplainable delays in the release of escrow funds 

46 See Employment Agreement § 4.3. 

47 See APA § 7.4. 

48 According to Felix Mira, Five Point’s Acting Chief Operating Officer, Five Point records show that Benham was, 

in fact, paid the full amount of his 2020 salary, albeit from two different sources. What he did not testify to, however, 

is whether all of the payments were made when due. 

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by the Escrow Agent and a lack of transparency and timeliness in the sharing of financial 

information with respect to Five Point’s calculation of the Earnout Amount targets and with respect 

to Benham SubCo’s performance. 

 Ultimately, by early 2024, communications between Benham and the Five Point principals 

had degraded to a point where they were downright heated and uncivil. This triggered a chain 

reaction that led to the current litigation between the parties. In particular, it appears that in the 

face of Five Point’s continuing refusal to address certain of Benham’s outstanding financial 

complaints and/or demands, Benham made it a point to effectively emphasize to Five Point that 

the Practice would not and could not survive without him, and that based upon the continuing 

refusal to address his demands, he would just “burn our offices to the ground” instead of supporting 

the Practice with his involvement.49 Following up on that statement, Benham purportedly 

misinformed Benham Ortho personnel that he had been instructed to permanently discontinue 

providing services to patients.50

 Given those statements, when Benham failed to show up at the Practice on February 1, 

2024, for his scheduled patient appointments, the management of Benham Ortho51 decided to 

terminate Benham’s employment. Accordingly, they sent a letter to Benham on the same date, 

informing him that his employment was terminated, effective immediately, pursuant to section 

3.2(d)(vi) of the Employment Agreement (the “Termination Letter”).52 Section 3.2(d) of the 

Employment Agreement provided that Benham Ortho had the right to terminate the Employment 

49 See Plaintiffs’ Exh. 2F (referring to Benham’s threat to “burn our offices to the ground”). 

50 See id. 

51 It was not made clear to the Court who the members of Benham Ortho’s management were at the time. However, 

given the connection of Lustig and Young to Benham Ortho (as its owners) and Five Point, the Court assumes that, 

directly or indirectly, Lustig and Young had a hand in the decision to terminate Benham. According to Benham, the 

Termination Letter was emailed to him by Young. 

52 See Plaintiff Exh. 2F (Termination Letter). 

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Agreement immediately at any time for Cause by providing written notice Benham. Subpart (vi) 

of section 3.2(d) specified that “Cause” would exist if Benham “engages in documented illegal 

harassment, assault or discrimination, or conduct that is jeopardizing patient care or patient or 

personnel safety.”53 Based upon the content of the Termination Letter, Benham Ortho’s 

management relied upon the jeopardizing clause, asserting a risk to both patient care and the 

personal safety of patients and personnel.54 According to Benham, when Benham went back to 

the Frisco Location the next day, on February 2, 2024, he was locked out of the building. 

 Thereafter, Benham went about the process of attempting to make good on his assertion 

that the Practice would not survive without him. Among other things, it appears that he approached 

those of the Practice’s personnel that he believed to remain loyal to him in an effort to have them 

separate from Five Point and join him. He also brainstormed on ways to communicate with his 

prior patients and to see those patients at other locations, and considered his options with respect 

to securing the Frisco Location and McKinney Location given that his company, BPOA, was the 

landlord of those locations. With the foregoing in mind, on April 24, 2024, Benham organized the 

Benham Debtor as a new Texas professional association to render orthodontic services. Benham 

listed the Frisco Location as the Benham Debtor’s business address on the Certificate of 

Formation.55

53 See Employment Agreement § 3.2(d)(iv). 

54 See Termination Letter (Stating “we consider your actions to be both an abandonment of your position without prior 

notice and a jeopardization of treatment for patients presently under your care”, and in response to the “burn our 

offices to the ground” comments, “[we] consider these threats to materially compromise the safety of our employees 

and patients”). 

55 See Plaintiffs’ Exh. 2G (Certificate of Formation of the Benham Debtor). 

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F. The Prepetition State Court Litigation and Injunctive Relief Granted 

By April 2024, matters had evolved to a point where Benham engaged legal counsel to 

pursue action against the Five Point Parties and the Five Point Parties engaged legal counsel to 

pursue action against Benham and BPOA. Thus, the race to the courthouse was on. 

 Benham was the first to strike, initiating the State Court Case in the 471st Judicial District 

Court of Collin County, Texas, on April 29, 2024, with the filing of his original petition against 

the Five Point Parties. In connection with his original petition, Benham sought and obtained an ex 

parte TRO against the Five Point Parties (the “Benham TRO”). Pursuant to the Benham TRO, 

the Five Point Parties were enjoined from, among other things, (i) withholding patient dental 

records from Benham, (ii) interfering with Benham’s treatment of patients at the Frisco Location 

and McKinney Location, (iii) obstructing or accessing Benham’s practice and treatment of patients 

at the Frisco and McKinney Location, (iv) contacting employees or patients of Benham, and (v) 

making any false, misleading, deceptive, or defamatory statements about Benham or his 

employees, contractors, business contacts, or patients.56

 The very same day, April 29, 2024, the Five Point Parties also filed suit in the 471st Judicial 

District Court of Collin County, Texas, commencing Cause No. 471-02582-2024 (the “Five Point 

Case”).57 In their original petition, they named Benham and BPOA as defendants, and they also 

requested and obtained TRO relief. Pursuant to their TRO (the “First Five Point TRO”), Benham 

and BPOA and their agents and representatives were enjoined58 from (i) entering or coming within 

100 yards of or on the leased premises at the Frisco Location and McKinney Location and (ii) 

taking any action intended to threaten or cause harm or injury to the Frisco Location or McKinney 

56 See Defendants’ Exh. 16 (Benham TRO). 

57 See EDTX Case, Docket No. 1 (attached Register of Actions, 4/29/2024 docket entry). 

58 The Court notes that the First Five Point TRO inadvertently omitted the words “are enjoined” from the operative 

ordered paragraph. It is clear from the entirety of the order, however, that that is what the State Court intended. 

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Location or the Five Point Parties’ owners, persons in control, employees, or other persons in, on, 

entering, or leaving the two locations.59

 Clearly, the Benham TRO and First Five Point TRO conflicted. Nevertheless, based upon 

the Benham TRO, Benham re-entered the Frisco Location and McKinney Location and informed 

anyone else who was there and not aligned with him to leave. Thereafter, Benham began to see 

his prior patients and, in the process, inform them of the termination action taken by the Five Point 

Parties and work with them to transition their patient relationships to the Benham Debtor. 

 Eventually, the State Court was advised of the two separately-filed actions and entered an 

order consolidating the Five Point Case with the State Court Case (the first-filed case).60 

Thereafter, on May 16, 2024, the State Court entered an agreed order extending both the Benham 

TRO and the First Five Point TRO.61

On the same date, the Five Point Parties filed an amended petition to add the Benham 

Debtor as a defendant and requested a modified TRO.62 On June 13, 2024, the State Court granted 

the modified TRO request. Pursuant to the modified TRO (the “Second Five Point TRO”), the 

Benham Parties (now including the Benham Debtor) and their agents and representatives were 

enjoined from (i) entering or coming within 100 yards of or on the leased premises at the Frisco 

Location and McKinney Location (except that BPOA and its representatives were permitted to 

enter the locations to show the premises to prospective purchasers, mortgagees and tenants and for 

the purposes of inspection, making repairs, and performing maintenance, subject to certain notice 

requirements), (ii) taking any action intended to threaten or cause harm or injury to the Frisco 

59 See Plaintiffs’ Exh. 2H (First Five Point TRO). 

60 See EDTX Case, Docket No. 2-6 (consolidation order). 

61 See EDTX Case, Docket No. 1 (attached Register of Actions, 5/16/2024 docket entry). 

62 See EDTX Case, Docket No. 1 (attached Register of Actions, 5/16/2024 docket entry). 

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Location or McKinney Location or the Five Point Parties’ owners, persons in control, employees, 

or other persons in, on, entering, or leaving the two locations, (iii) taking certain types of actions 

that violate the APA Protections and/or EA Protections, and (iv) taking certain types of spoliation 

actions.63 Curiously, the order did not address the terms of the conflicting Benham TRO. 

On June 27, 2024, the State Court considered the parties’ competing requests for 

conversion of their TROs into temporary injunctions. In Benham’s case, the request was denied.64 

In the Five Point Parties’ case, the State Court granted the request, issuing a Temporary Injunction 

on June 28, 2024 (the “Original Temporary Injunction”). The scope of relief provided pursuant 

to the Original Temporary Injunction, however, was considerably more narrow than that of the 

Second Five Point TRO. It solely enjoined Benham, and his agents, representatives, and 

employees having notice of the order, from (i) entering the Frisco Location or McKinney Location, 

except pursuant to any future writ or final judgment obtained from a justice court of proper 

jurisdiction, and (ii) causing or threatening to cause harm, damage, destruction, or injury to any 

person, property, or structure located at either the Frisco Location or McKinney Location.65 

Ostensibly emboldened by the narrowing of the injunctive relief pursuant to the Original 

Temporary Injunction, it appears that Benham continued in his effort to reach out to and treat his 

prior patients.

Ultimately, Benham’s actions led to the Five Point Parties’ filing of an emergency motion 

for contempt.66 On July 18, 2024, the State Court heard the motion and determined that the best 

court of action was to enter an amended temporary injunction to ensure that the court’s directives 

63 See Plaintiffs’ Exh. 2I (Second Five Point TRO). 

64 See EDTX Case, Docket No. 1 (attached Register of Actions, 6/27/2024 and 6/28/2024 docket entries). 

65 See Plaintiffs’ Exh. 2J (Original Temporary Injunction). 

66 See EDTX Case, Docket No. 1 (attached Register of Actions, 7/3/2024 docket entry). 

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were clear.67 Accordingly, on July 19, 2024, the State Court entered the amended temporary 

injunction (the “Amended Temporary Injunction”) pursuant to which the Benham Parties, and 

their agents, representatives, and all persons in active concert or participation with them who 

receive actual notice of the order, were enjoined from entering or coming within 100 yards of or 

on the leased premises at the Frisco Location and McKinney Location (except that a representative 

of BPOA other than Benham was permitted to enter the locations to show the premises to 

prospective purchasers, mortgagees and tenants and for the purposes of inspection, making repairs, 

and performing maintenance, subject to certain notice requirements), and (ii) taking certain types 

of actions that would violate the non-disclosure obligations of section 7.3 of the APA. 

Additionally, Benham, along with his agents, representatives, and all persons in active concert or 

participation with him who receive actual notice of the order, were enjoined from (i) causing or 

threatening to cause harm, damage, destruction, or injury to the Frisco Location or McKinney 

Location or any person or personal property located therein (other than as a defensive measure), 

(ii) taking certain types of actions that violate the non-compete professional services APA 

Protections and EA Protections, and (iii) taking certain types of action that violate the nondisclosure EA Protections.68

 Following entry of the Amended Temporary Injunction, personnel of the Five Point Parties 

were able to re-enter the Frisco Location and McKinney Location. Before doing so, Benham and 

his staff hurriedly removed various items of personal property from the locations. According to 

Benham, he believed the property to belong to Benham or the staff members, as opposed to any of 

the Five Point Parties. While ostensibly true with respect to certain of the property, it appears that 

among the property removed from the Frisco Location and McKinney Location were certain 

67 See EDTX Case, Docket No. 1 (attached Register of Actions, 7/18/2024 docket entry). 

68 See Plaintiffs’ Exh. 2L (Amended Temporary Injunction). 

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instruments and apparatuses used in the Practice and patient trays and appliances. Even more 

troubling was that certain electronically stored records and patient information appears to have 

been tampered with to disrupt the Five Point Parties’ ability to resume the operations of the 

Practice. 

The discovery of these things caused the Five Point Parties to hire a private investigator. 

With the assistance of the investigator, the Five Point Parties learned that Benham had caused the 

removed personal property to be moved to a Sea of Smiles office located in Frisco, Texas. 

Consequently, on July 23, 2024, the Five Point Parties filed a second amended petition to add Sea 

of Smiles Pediatric Dentistry, PLLC (“Sea of Smiles”) as a defendant and request supplemental 

TRO relief.69 On the same date, the State Court entered the requested supplemental TRO (the 

“Supplemental Five Point TRO”) pursuant to which (i) Benham, the Benham Debtor, and Sea of 

Smiles, along with their agents and representatives, were enjoined from removing, transporting, 

concealing, altering, distributing, disseminating, manipulating, destroying, or otherwise using any 

personal property that originated from or was located at the Frisco Location or McKinney Location 

prior to July 19, 2024, irrespective of any claims of ownership, and (ii) Benham, the Benham 

Debtor, and Seal of Smiles were ordered to return all such property to the Frisco Location or 

McKinney Location within 24 hours of receiving notice of the order, and providing an inventory 

of all such property that is not returned by the 24-hour deadline.70 Additionally, the Supplemental 

Five Point TRO made it clear that it was not meant to amend, modify, or override the Amended 

Temporary Injunction.71

69 See EDTX Case, Docket No. 1 (attached Register of Actions, 7/23/2024 docket entries). 

70 See Plaintiffs’ Exh. 2M (Supplemental Five Point TRO). 

71 See id. 

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 Ultimately, no property was returned to the Frisco Location or McKinney Location by 

Benham, the Benham Debtor, or Sea of Smiles. Consequently, the Five Point Parties hired a third 

party to go to the Sea of Smiles location and retrieve as much of the removed property as could be 

determined. According to the Five Point Parties, some of the removed property is still missing, 

including cases of orthodontic liners and the like. This has caused a disruption to the provision of 

care to the Benham Ortho patients. 

G. Additional Actions Taken Since July 23, 2024 

 Following entry of the Amended Temporary Injunction and Supplemental Five Point TRO, 

Benham arranged to begin practicing out of Pediatric Dentistry of Colleyville (“PDC”) dental 

office located in Colleyville, Texas. While the PDC Colleyville office is more than 20 miles away 

from both the Frisco Location and the McKinney Location, it is located within 20 miles of other 

Five Point or Five Point “Supported Practice” offices. Benham has also continued in his efforts to 

communicate with his prior patients at Benham Ortho, encouraging them to move to Benham’s 

new practice with the Benham Debtor operating under the name “Benham Family Orthodontics.” 

Benham has also continued to aid his prior patients in completing the necessary paperwork to 

transfer their patient files to the Benham Debtor and obtain a refund or redirection of payments 

made on Five Point lifetime orthodontic service plans.72

H. The Five Point Parties’ Requested TRO Relief 

 In the current adversary proceeding, the Plaintiffs (the Five Point Parties) seek the same 

type of expansive TRO relief as they obtained under the Second Five Point TRO, the Amended 

Temporary Injunction, and/or the Supplemental Five Point TRO. In fact, significant aspects of the 

72 See Plaintiffs’ Exhs. 2N, 2P, 2S and 2Q. 

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requested relief are duplicative of existing relief that is in place under the Amended Temporary 

Injunction. 

 The specific injunctive relief sought by the Five Point Parties is set forth in paragraphs 150 

and 151 of the Complaint (part of the TRO Application). On August 16, 2024, the Plaintiffs filed 

a proposed form of TRO (the “Proposed TRO”) that incorporates the same relief sought pursuant 

to paragraphs 150 and 151.73 At the continued hearing on August 22, 2024, counsel for the 

Plaintiffs presented the Court with a revised draft of the Proposed TRO, which largely leaves 

unaltered the ordered relief provisions of the Proposed TRO, but which does eliminate all 

requested relief against BPOA by removing BPOA from the definition of “Benham Parties.” 

Consequently, the Court deems the Plaintiffs to have waived their request for any relief against 

BPOA pursuant to the TRO Application. 

In relation to the remaining Defendants (Benham and the Benham Debtor), inasmuch as 

much of the relief sought pursuant to the TRO Application and Proposed TRO is duplicative of 

the relief already in place pursuant to the Amended Temporary Injunction, it is helpful to compare 

the Proposed TRO to the Amended Temporary Injunction to assess what new relief is actually 

being sought by the Plaintiffs: 

Proposed TRO Provision Relief Provided in Amended Temporary Injunction 

Page 7, ¶ a) Plaintiffs’ Exh. 2L, App.158, ¶ a 

Page 8, ¶ b) Plaintiffs’ Exh. 2L, App.158, ¶ b 

Page 8, ¶ c) Plaintiffs’ Exh. 2L, App.158, ¶ c (substantially identical) 

Page 8, ¶ d) Plaintiffs’ Exh. 2L, App.158, ¶ d (only as to Benham) 

Page 8, ¶ e) 

Page 8, ¶ f) Plaintiffs’ Exh. 2L, App.158, ¶ e (only as to Benham) 

Page 8, ¶ g) 

Page 8, ¶ h) Plaintiffs’ Exh. 2L, App.158, ¶ f (only as to Benham) 

Pages 8-9, ¶¶ i) – m) 

Page 9, ¶ n) Plaintiffs’ Exh. 2L, App.158, ¶ b 

Pages 9-10, ¶¶ o) – t) 

73 See Docket No. 4 (Proposed TRO). 

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 In response to the Plaintiffs’ request for TRO relief, the Defendants argue that the Plaintiffs 

have failed to satisfy their burden of establishing a right to any of the TRO relief. Additionally, 

the Defendants have effectively raised the following affirmative defenses: (a) the APA Protections 

and EA Protections of the APA and Employment Agreement are unenforceable because Benham 

was fraudulently induced into executing the agreements; (b) the APA Protections and EA 

Protections of the APA and Employment Agreement are unenforceable because the Five Point 

Parties (in the case of the APA) and Benham Ortho (in the case of the Employment Agreement) 

materially breached the agreements, thereby relieving Benham’s obligation to honor such 

protections; (c) in the case of the non-compete provisions of the APA, they are unenforceable as 

against public policy to the extent that they purport to enjoin conduct beyond the 20-mile radius 

of the Frisco Location and McKinney Location. 

ANALYSIS OF RELIEF SOUGHT PURSUANT TO TRO APPLICATION 

A. Standard Applicable to the Provision of TRO Relief 

For each claim that is properly before the Court, to obtain injunctive TRO relief in relation 

thereto, the Plaintiffs must establish that (1) there is a substantial likelihood that they will prevail 

on the merits of such claim; (2) there is a substantial threat that irreparable harm will result to the 

Plaintiffs if the injunction is not granted; (3) the threatened injury to the Plaintiffs outweighs the 

threatened harm to the Defendants sought to be enjoined; and (4) the granting of injunctive relief 

will not disserve the public interest.74

74 See Clark v. Prichard, 812 F.2d 991, 993 (5th Cir. 1987); see also Anderson v. Jackson, 556 F.3d 351, 360 (5th Cir. 

2009).

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B. Relief Already Provided in the Amended Temporary Injunction 

 As previously indicated, numerous categories of relief sought pursuant to the TRO 

Application have already been provided to the Plaintiffs pursuant to the Amended Temporary 

Injunction. Thus, to such extent, the Court declines to grant additional relief. Not only will this 

protect against the possibility of having conflicting orders down the road, but the Plaintiffs cannot 

satisfy their burden of proving irreparable harm given the injunctive relief that is already in place. 

That said, and for the avoidance of doubt, to the extent the automatic stay of 11 U.S.C. § 

362 ostensibly impacts the enforceability of the Amended Temporary Injunction against the 

Benham Debtor, the Court will grant relief from the automatic stay to ensure that the protections 

afforded by the Amended Temporary Injunction are in full force and effect against the Benham 

Debtor. 

C. Determination of Bases for Relief Sought and Evaluation of Right to Relief 

 Next, with respect to the remaining requested relief, the Plaintiffs must, among other 

things, establish that there is a substantial likelihood that they will prevail on the merits of the 

applicable claim supporting the injunctive relief sought. Hence, it is necessary to consider which 

of the Plaintiffs’ claims apply to the particular injunctive relief being sought. On this point, the 

Plaintiffs have provided little in the way of guidance. Thus, the Court has attempted to map out 

the connections, as follows: 

 

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Proposed TRO 

Provision 

Nature of Relief Sought Ostensible Applicable Claim(s) 

Page 8, ¶ d) Prevention of assault (re Benham Debtor only) Count 2 – Assault 

Page 8, ¶ e) Action re 7/19/2024 removed property Count 9 – Conversion 

Page 8, ¶ f) Non-compete re profess. services (re Benham Debtor only) Count 6 – Tortious Interference 

Page 8, ¶ g) Non-compete re non-professional services Count 3 – Breach of APA 

Count 6 – Tortious Interference 

Page 8, ¶ h) Retention of confi/proprietary info (re Benham Debtor only) Count 6 – Tortious Interference 

Count 7 – DUTSA 

Page 8, ¶ i) Non-interference/solicitation – employees/indep. contractors Count 3 – Breach of APA 

Count 6 – Tortious Interference 

Page 8, ¶ j) Non-interference/solicitation – patients Count 4 – Breach of Employment Agmt 

Count 6 – Tortious Interference 

Page 9, ¶ k) Non-interference/solicitation – vendors/service providers Count 4 – Breach of Employment Agmt 

Count 6 – Tortious Interference 

Page 9, ¶ l) Disparagement Count 3 – Breach of the APA 

Count 6 – Tortious Interference 

Page 9, ¶ m) Non-compete re name use Count 4 – Breach of Employment Agmt 

Count 6 – Tortious Interference 

Page 9, ¶ o) Spoliation prevention 

Page 9, ¶ p) Return of property taken from Frisco or McKinney Locations Count 9 – Conversion 

Page 9, ¶ q) Provision of inventory of non-returned property Count 8 – Accounting 

Page 9, ¶ r) Provision of inventory of electronic equipment 

Page 10, ¶ s) Identification of parties to whom confi info disclosed 

Page 10, ¶ t) Identification of persons contacted since 4/29/2024 re services 

1. Relief Sought Based Upon the Assault Claim 

 First, with respect the requested injunctive relief against the Benham Debtor predicated 

upon Count 2 (Assault) – i.e., Proposed TRO ¶ d) – because Count 2 is not properly before the 

Court given the terms of the Order of Reference, the Court will deny this aspect of the TRO 

Application without prejudice. 

2. Relief Sought Based Upon the Conversion Claim 

 To prevail on a claim for conversion under Texas law, a plaintiff must show that (1) the 

plaintiff owned, possessed, or had the right to immediate possession of personal property, (2) the 

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defendant unlawfully and without authorization exercised dominion or control over the property 

to the exclusion of, or inconsistent with, the plaintiff’s rights, and (3) the plaintiff suffered injury.75

In relation to Count 9 (Conversion), pursuant to the TRO Application and Proposed TRO, 

the Plaintiffs request that Benham and the Benham Debtor (and their related parties) be enjoined 

from taking the following action: 

Proposed TRO ¶ e). “Removing, transporting, concealing, altering, distributing, 

disseminating, manipulating, destroying, or otherwise using any personal property 

that originated from or was located at the McKinney [Location] and/or Frisco 

[Location] prior to July 19, 2024, irrespective of any claims of ownership of the 

personal property.” 

Separately, the Plaintiffs request that Benham and the Benham Debtor be compelled to take the 

following action: 

Proposed TRO ¶ p). “Return to the Frisco [Location] all personal property the 

Benham Parties removed from the Frisco [Location] or the McKinney [Location].” 

Applying the TRO standards, the Court finds as follows: 

(1) Substantial Likelihood of Success. Based upon Benham’s removal of personal property 

from the Frisco Location and McKinney Location on July 19, 2024, and failure to thereafter return 

all such items as required by the Supplemental Five Point Order, there is a substantial likelihood 

that the Plaintiffs will prevail on the merits of the conversion claim, but only to the extent the 

personal property at issue is personal property that the Plaintiffs owned and/or had the right to 

possess to the exclusion of the Defendants as of July 19, 2024. 

(2) Irreparable Injury. Because of the failure of Benham and the Benham Debtor to return 

such personal property to the Plaintiffs after being ordered to do so pursuant to the Supplemental 

Five Point TRO, there is a substantial threat that irreparable harm will result to the Plaintiffs if the 

above injunctive relief (as narrowed) is not granted. 

(3) Balancing of Harm. By limiting the relief to only that personal property that the 

Plaintiffs owned and/or had the right to possess to the exclusion of the Debtors, the threatened 

injury to the Plaintiffs in the absence of such injunctive relief clearly outweighs any threatened 

harm to Benham and the Benham Debtor if the injunctive relief is provided. 

(4) Public Interest. The granting of such injunctive relief (as narrowed) will not in any 

way disserve the public interest. 

75 See Bookout v. Shelley, No. 02-22-00055-CV, 2022 WL 17173526, at *22 (Tex. App. – Fort Worth Nov. 23, 2022, 

no pet.). 

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Therefore, the TRO Application will be granted to the extent of the requested relief in ¶¶ 

e) and p) of the Proposed TRO, but only with respect to personal property that the Plaintiffs owned 

and/or had the right to possess to the exclusion of the Defendants as of July 19, 2024. 

3. Relief Sought Based Upon the Breach of APA Claim 

And Associated Tortious Interference Claim 

 The APA is governed by Delaware law.76 The elements for breach of contract under 

Delaware law are: (1) the existence of a contract; (2) a breach of an obligation imposed by that 

contract; and (3) damages.77 In the case of tortious interference with an existing contract, any 

alleged tortious interference with the APA took place within Texas. Under Texas law, the elements 

of tortious interference with an existing contract are: (1) an existing contract subject to 

interference; (2) a willful and intentional act of interference with the contract; (3) that proximately 

caused the plaintiff’s injury; and (4) resulting in actual damages or loss.78

 The Defendants assert that, even if the Plaintiffs have shown that Benham took action in 

contravention of the terms of the APA, it does not matter because the APA was unenforceable on 

account of fraudulent inducement, or due to a prior material breach on the part of the Five Point 

Parties, or in relation to the applicable APA non-compete provision, as against public policy to the 

extent the provision precludes activity beyond 20 miles of the Frisco Location and McKinney 

Location. Following up on these defenses, the Defendants assert that the Benham Debtor likewise 

cannot be held liable for having tortiously interfered with the APA. 

In relation to the foregoing, to establish the affirmative defense of fraudulent inducement 

under Delaware law, a defendant bears the burden of proving that the defendant’s assent to the 

76 See APA § 8.6. 

77 See Adviser Invs., LLC v. Powell, C.A. No. 2022-1149-MAA, 2023 WL 6383242, at *8 (Del Ch. Sept. 29, 2023). 

78 See Prudential Ins. Co. of Am. v. Financial Review Servs., Inc., 29 S.W.3d 74, 77 (Tex. 2000). 

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contract at issue was (1) induced by either a fraudulent or a material misrepresentation by the other 

party to the contract, and (2) the defendant’s reliance on such misrepresentation was justifiable.79 

Next, with respect to the affirmative defense of an earlier breach, under Delaware law a party is 

excused from performance under a contract if the other party is in material breach thereof.80 The 

question of materiality is one of degree and is determined by weighing the consequences in the 

light of the actual custom of men in the performance of contracts similar to the one at issue.81 

Finally, with respect to the enforceability of a non-compete provision under Delaware law, “[t]o 

be enforceable, a covenant not to compete must [among other things] be reasonable in scope and 

duration, both geographically and temporally” and the covenant must “advance a legitimate 

economic interest of the party enforcing the covenant.”82

In relation to Count 3 (Breach of the APA) and Count 6 (Tortious Interference with 

Existing Contracts) (to the extent focused on the APA), pursuant to the TRO Application and 

Proposed TRO, the Plaintiffs request that Benham and the Benham Debtor (and their related 

parties) be enjoined from taking the following actions: 

Proposed TRO ¶ g). “Providing management, business, marketing, or other support 

services to any orthodontic, corrective aligner or dental practice or orthodontist, 

dental or dental professional anywhere within the State of Texas and anywhere 

within a twenty (20) mile radius extending in all directions from the location of 

each location at which the Five Point Parties are currently operating.” 

Proposed TRO ¶ i). “Soliciting, recruiting, inducing, persuading, or encouraging 

any person who then is, or at any time during the then preceding twenty-four (24) 

months from January 1, 2020, was, an employee or independent contractor of the 

Five Point Parties to modify or terminate his or her employment or engagement or 

to become employed or engaged by any other person.” 

79 See Griffin Corp. Servs., LLC v. Jacobs, No. Civ.A.396-N, 2005 WL 2000775, at *10 n.62 (Del. Ch. Aug. 11, 2005) 

(quoting Restatement (Second) of Contracts § 164 (1981)). 

80 See Biolife Solutions, Inc. v. Endocare, Inc., 838 A.2d 268, 278 (Del. Ch. 2003). 

81 See id. 

82 Intertek Testing Servs. NA, Inc. v. Eastman, C.A. No. 2022-0853-LWW, 2023 WL 2544236, at *3 (Del. Ch. Mar. 

16, 2023) (quoting Weichert Co. of Pa. v. Young, 2007 WL 4372823, at *3 (Del. Ch. Dec. 7, 2007)). 

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Proposed TRO ¶ l). “Disparaging or making derogatory statements (orally, in 

writing, social media, electronically or otherwise) regarding the Five Point Parties 

and their respective affiliates.” 

Applying the TRO standards, the Court finds as follows: 

(1) Substantial Likelihood of Success. The above requested injunctive language ties to the 

APA Protections set forth in §§ 7.2(a)(B), 7.2(b), and 7.2(e) of the APA. In the case of Proposed 

TRO ¶¶ g) and i), the Plaintiffs have presented evidence of Benham having taken, and continuing 

to take, actions in contravention of §§ 7.2(a)(B) and 7.2(b) of the APA, which are the predicates 

for such TRO relief. Benham organized the Benham Debtor to facilitate Benham’s pursuit of such 

prohibited objectives, and thus the Benham Debtor has interfered, and continues to interfere, with 

the APA in such regard. In the case of Proposed TRO ¶ l), which is predicated upon APA § 7.2(e), 

the record is significantly less clear. Noting that “disparagement” is generally recognized as “the 

publication of false and injurious statements that are derogatory of another’s property, business, 

or product,”83 none of the evidence presented reflects a statement that was convincingly both false 

and injurious. 

Turning to the Defendants affirmative defenses, in the case of fraudulent inducement, the 

Court did not find compelling Benham’s assertion that he was lured into signing the APA by 

assurances that he would receive substantially more income than he has received. Among other 

things, pursuant to the APA, Benham represented and warranted that he was an informed and 

sophisticated investor, and had engaged advisors, experienced in transactions of the type 

contemplated by the APA. He further acknowledged that he was informed of the risks of the 

transactions and that he had relied upon no representations other than those contained in the APA, 

in the Ancillary Agreements, or in the Limited Liability Agreement of Benham SubCo. Finally, 

he acknowledged that he had not relied upon any implied representations or warranties as to the 

prospects or the likelihood of success of Benham SubCo or Benham Ortho.84

Turning to the assertion of a prior material breach, while it appears that the Five Point 

Parties have failed to timely provide reporting with respect to the Earnout Amount payments, the 

Court does not find such failures to be material given the payment to Benham of the maximum 

amount of the Earnout Amount payable under the APA. Separately, with respect to questions 

about amounts apparently still held in escrow and whether Benham SubCo was carrying debt on 

its balance sheet in the same amount of the Earnout Amount payments, the evidence was murky 

at best, and not suggestive of any failures that rise to the level of materiality excusing ongoing 

performance. 

Finally, with respect to the enforceability of the non-compete provisions of APA § 

7.2(a)(B), the Court fails to see how precluding Benham from performing any 

managerial/business-related services tied to the dental/orthodontic field throughout the entirety of 

Texas and, in particular, beyond 20 miles of the Frisco Location and McKinney Location will 

advance any legitimate economic interest of the Five Point Parties given that the non-compete 

83 See “disparagement.” Merriam-Webster.com. 2024. https://www.merriam-webster.com (26 August 2024). 

84 See APA § 4.19. 

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limitations applicable to Benham’s provision of dental/orthodontal patient care services (i.e., APA 

§ 7.2(a)(A)) are confined to within 20 miles of the Frisco Location and McKinney Location. 

Thus, based upon the foregoing and in summary, the Court finds that there is a substantial 

likelihood that the Plaintiffs will prevail on the merits of their breach of APA claim and 

corresponding tortious interference with contract claim in relation to APA §§ 7.2(a)(B) and 7.2(b); 

provided, however, that in relation to APA § 7.2(a)(B), the substantial likelihood of success is 

limited to violative actions taken within a 20 mile radius of the Frisco Location and McKinney 

Location and not beyond. On the other hand, the Court does not find that there is a substantial 

likelihood that the Plaintiffs will prevail on the merits of their breach of APA claim and associated 

tortious interference claim in relation to APA § 7.2(e). 

(2) Irreparable Injury. Because of the repetitive violations of APA §§ 7.2(a)(B) (as 

limited) and 7.2(b) by Benham, and Benham’s use of the Benham Debtor in connection therewith, 

there is a substantial threat that irreparable harm will result to the Plaintiffs if the injunctive relief 

set forth in ¶¶ g) and i) of the Proposed TRO (as narrowed in the case of ¶ g)) is not granted. 

(3) Balancing of Harm. Given the nature of the violative actions involved, the ability of 

Benham and the Behnam Debtor to stop violating/interfering with the APA Protections at issue, 

and the ability of Benham and the Benham Debtor to conduct business operations in a way that 

will not violate/interfere with the APA Protections at issue, the threatened injury to the Plaintiffs 

in the absence of such injunctive relief clearly outweighs any threatened harm to Benham and the 

Benham Debtor if the injunctive relief is provided. 

(4) Public Interest. The granting of such injunctive relief (as narrowed) will not in any 

way disserve the public interest. 

Therefore, the TRO Application will be granted to the extent of the requested relief in ¶¶ g) and i) 

of the Proposed TRO, but in the case of ¶ g), limited to the 20-mile radius of the Frisco Location 

and McKinney Location, and in the case of ¶ i), simplified in terminology. The TRO Application 

will be denied with respect to the relief requested in Proposed TRO ¶ l). 

4. Relief Sought Based Upon the Breach of Employment Agreement 

Claim and Associated Tortious Interference Claim 

 The Employment Agreement is governed by Texas law.85 The elements for breach of 

contract under Texas law are: (1) the existence of a valid contract; (2) performance or tendered 

performance by the plaintiff; (3) breach of the contract by the defendant; and (4) resulting damages 

85 See Employment Agreement § 5.3 and Recital A (defining “State” as the State of Texas). 

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to the plaintiff.86 In the case of tortious interference with an existing contract, the elements under 

Texas law are set out above. 

 The Defendants again assert that, even if the Plaintiffs have shown that Benham took action 

in contravention of the terms of the Employment Agreement, it does not matter because the 

Employment Agreement was unenforceable on account of fraudulent inducement or due to a prior 

material breach on the part of Benham Ortho. Following up on these defenses, the Defendants 

assert that the Benham Debtor likewise cannot be held liable for having tortiously interfered with 

the Employment Agreement. 

In relation to the foregoing, to establish the affirmative defense of fraudulent inducement 

to a breach of contract claim under Texas law, a defendant bears the burden of proving that (1) 

there was a material representation made that was false, (2) the party who made the representation 

knew that it was false or made it recklessly as a positive assertion without any knowledge of its 

truth, (3) the party making the representation intended to induce action upon the representation, 

and (4) the representation was actually and justifiably relied upon, thereby causing injury.87 Next, 

with respect to the affirmative defense of an earlier breach, under Texas law, when one party to a 

contract commits a material breach of that contract, the other party is discharged from further 

performance.88 In determining whether a breach is material, the following factors should be 

considered: (a) the extent to which the injured party will be deprived of the benefit which he 

reasonably expected; (b) the extent to which the injured party can be adequately compensated for 

the part of the benefit of which he will be deprived; (c) the extent to which the party failing to 

perform or to offer to perform will suffer forfeiture; (d) the likelihood that the party failing to 

86 See Rice v. Metropolitan Life Ins. Co., 324 S.W.3d 660, 666 (Tex. App. – Fort Worth 2010, no pet.). 

87 See Atlas Props, Inc. v. Republic Waste Servs. of Tex., Ltd., No. 02-11-00332-CV, 2012 WL 579442, at *2 (Tex. App. 

– Fort Worth Feb. 23, 2012, no pet.). 

88 See Bartush-Schnitzius Foods Co. v. Cimco Refrigeration, 518 S.W.3d 432, 436 (Tex. 2017). 

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perform or to offer to perform will cure his failure, taking account of the circumstances, including 

any reasonable assurances; and (e) the extent to which the behavior of the party failing to perform 

or to offer to perform comports with standards of good faith and fair dealing.89

In relation to Count 4 (Breach of the Employment Agreement) and Count 6 (Tortious 

Interference with Existing Contracts) (to the extent focused on the Employment Agreement), 

pursuant to the TRO Application and Proposed TRO, the Plaintiffs request that Benham and the 

Benham Debtor (and their related parties) be enjoined from taking the following actions: 

Proposed TRO ¶ j). “Soliciting, recruiting, inducing, persuading, or encouraging 

any person who then is, or at any time during the then preceding twenty-four (24) 

months from January 1, 2020, was, a patient of Benham Ortho, the [Practice at the 

Frisco Location], or [the Practice at the McKinney Location] or any of their dentists 

or orthodontists to terminate or otherwise interfere with his or her patient 

relationship with Benham Ortho or to receive any orthodontic, aligner or dental 

services, treatment or consultation from any other person.” 

Proposed TRO ¶ k). “Soliciting, recruiting, inducing, persuading, or encouraging 

any person who then is, or at any time during the then preceding twenty-four (24) 

months from January 1, 2020, was, a vendor or service provider of Benham Ortho, 

the [Practice at the Frisco Location], or [the Practice at the McKinney Location], 

or any of their dentists or orthodontists to terminate or otherwise interfere with their 

business relationship with Benham Ortho.” 

Proposed TRO ¶ m). “Neither directly nor indirectly using, practicing, or operating 

under ‘Benham Orthodontics’ or any variants thereof, including, but not limited to, 

‘Benham Orthodontics & Associates PA.’” 

Applying the TRO standards, the Court finds as follows: 

(1) Substantial Likelihood of Success. The above requested injunctive language ties to the 

EA Protections set forth in §§ 4.2(c)(i), 4.2(c)(ii), and 4.3 of the Employment Agreement. In the 

case of Proposed TRO ¶ j), the Plaintiffs have presented evidence of Benham having taken, and 

continuing to take, actions in contravention of § 4.2(c)(i) of the Employment Agreement, which is 

the predicate for such TRO relief. In the case of Proposed TRO ¶ k), which is predicated upon 

Employment Agreement § 4.2(c)(ii), the Plaintiffs have presented evidence of Benham having 

taken action in relation to Benham Ortho’s relationship with Ortho-fi that violates § 4.2(c)(ii) of 

the Employment Agreement, which is the predicate for such TRO relief;90 however, the Plaintiffs 

have failed to present evidence of Benham’s interference with any other vendor or service provider 

89 See id. at 436-37 (citing Mustang Pipeline Co. v. Driver Pipeline Co., 134 S.W.3d 195, 199 (Tex. 2004)). 

90 See Plaintiffs’ Exh. 2N. 

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relationships with Benham Ortho. Finally, in the case of Proposed TRO ¶ m), which is predicated 

upon Employment Agreement § 4.3, the Plaintiffs have presented evidence of Benham’s violation 

of the name use limitations by, among other things, establishing a new professional association 

under the name “Benham Orthodontics & Associates PA” (the Benham Debtor) and, through it, 

practicing under the name “Benham Family Orthodontics.”91 In each case, because Benham’s 

actions have been taken by and through, or in concert with, the Benham Debtor, the Plaintiffs have 

also introduced evidence of the Benham Debtor’s tortious interference with the Employment 

Agreement. 

Turning to the Defendants affirmative defenses, in the case of fraudulent inducement, the 

Defendants rely upon the same arguments made in relation to the APA. Therefore, for the same 

reasons discussed above, the Court did not find compelling Benham’s assertion that he was lured 

into signing the Employment Agreement by assurances that he would receive substantially more 

income than he has received. 

Turning to the assertion of a prior material breach, Benham appears to assert two different 

grounds. First, he claims that he was not paid the full amount of his $250,000 salary in 2020. 

According to Mr. Mira, however, payments were made from two different sources and provided 

Benham with the full amount of his 2020 salary. Thus, given the fact that this question did not 

arise until the litigation was initiated in 2024, it appears that Benham was, in fact, paid the full 

amount of his 2020 salary, but that some portion of it was not paid in 2020. While the failure to 

timely comply with the salary provisions of the Employment Agreement may constitute a breach, 

the fact that the full amount has been paid causes any such breach to not be of a material nature 

excusing all further performance by Benham. Separately, Benham suggests that his immediate 

firing on February 1, 2024, failed to comply with the termination provisions of Employment 

Agreement § 3.2(d)(vi). However, the Plaintiffs presented evidence of a sufficient nature to 

warrant action under § 3.2(d)(vi). 

Thus, based upon the foregoing and in summary, the Court finds that there is a substantial 

likelihood that the Plaintiffs will prevail on the merits of their breach of Employment Agreement 

claim and corresponding tortious interference with contract claim in relation to Employment 

Agreement §§ 4.2(c)(i), 4.2(c)(ii), and 4.3; provided, however, that in relation to Employment 

Agreement § 4.2(c)(ii), the substantial likelihood of success is limited to violative actions taken in 

relation to Ortho-fi. 

(2) Irreparable Injury. Because of the repetitive violations of Employment Agreement §§ 

4.2(c)(i), 4.2(c)(ii)(as limited) and 4.3 by Benham, and Benham’s use of the Benham Debtor in 

connection therewith, there is a substantial threat that irreparable harm will result to the Plaintiffs 

if the injunctive relief set forth in ¶¶ j), k) and m) of the Proposed TRO (as narrowed in the case 

of ¶ k)) is not granted. 

(3) Balancing of Harm. Given the nature of the violative actions involved, the ability of 

Benham and the Behnam Debtor to stop violating/interfering with the EA Protections at issue, and 

the ability of Benham and the Benham Debtor to conduct business operations in a way that will 

not violate/interfere with the EA Protections at issue, the threatened injury to the Plaintiffs in the 

91 See, e.g., Plaintiffs’ Exh. 2Q. 

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absence of such injunctive relief clearly outweighs any threatened harm to Benham and the 

Benham Debtor if the injunctive relief is provided. 

(4) Public Interest. The granting of such injunctive relief (as narrowed) will not in any 

way disserve the public interest. 

Therefore, the TRO Application will be granted to the extent of the requested relief in ¶¶ j), k) and 

m) of the Proposed TRO, but in the case of ¶ k), limited to Benham Ortho’s business relationship 

with Ortho-fi, and in the case of ¶¶ j) and k), simplified in terminology. 

 5. Relief Sought in Relation to Provision of Professional Services 

 Based Upon Tortious Interference Claim 

 Pursuant to the Amended Temporary Injunction, Benham (and his related parties) are 

enjoined from “[p]roviding any orthodontic, corrective aligner, or dental services or any ancillary 

services related thereto or otherwise competing with the Five Point Parties within a twenty (20) 

mile radius extending in all directions from the Frisco [Location] and the McKinney [Location].”92 

The Plaintiffs seek to extend the injunctive protection to the Benham Debtor (and its related 

parties) as well pursuant to Count 6 (Tortious Interference with Existing Contracts) (related to the 

Employment Agreement). The elements of tortious interference with an existing contract under 

Texas law are set out above. 

In relation to Count 6, pursuant to the TRO Application and Proposed TRO, the Plaintiffs 

request that the Benham Debtor (and its related parties) be enjoined from taking the following 

actions: 

Proposed TRO ¶ f). “Providing any orthodontic, corrective aligner, or dental 

services or any ancillary services related thereto or otherwise competing with the 

Five Point Parties within a twenty (20) mile radius extending in all directions from 

the Frisco [Location] and the McKinney [Location].” 

Applying the TRO standards, the Court finds as follows: 

92 See Plaintiffs’ Exh. 2L, App. 158, ¶ e. 

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(1) Substantial Likelihood of Success. The above requested injunctive language ties to the 

EA Protections set forth in § 4.2(a) of the Employment Agreement. The Plaintiffs have presented 

evidence of Benham having taken, and continuing to take, actions in contravention of such section. 

Benham’s organization of the Benham Debtor to facilitate Benham’s pursuit of prohibited 

objectives is interfering with Benham’s obligations under § 4.2(a) of the Employment Agreement. 

(2) Irreparable Injury. Because of the repetitive violations of Employment Agreement § 

4.2(a) by Benham, and Benham’s use of the Benham Debtor in connection therewith, there is a 

substantial threat that irreparable harm will result to the Plaintiffs if the injunctive relief set forth 

in ¶ f) of the Proposed TRO is not granted against the Benham Debtor. 

(3) Balancing of Harm. Given the nature of the violative actions involved, the ability of 

the Behnam Debtor to stop interfering with the EA Protections at issue, and the ability of the 

Benham Debtor to conduct business operations in a way that will not interfere with the EA 

Protections at issue, the threatened injury to the Plaintiffs in the absence of such injunctive relief 

clearly outweighs any threatened harm to the Benham Debtor if the injunctive relief is provided. 

(4) Public Interest. The granting of such injunctive relief will not in any way disserve the 

public interest. 

Therefore, the TRO Application will be granted to the extent of the requested relief in ¶ f) of the 

Proposed TRO with respect to the Benham Debtor. 

6. Relief Sought in Relation to Confidential Information Based Upon 

Tortious Interference Claim and Delaware Uniform Trade Secrets Act 

 Pursuant to the Amended Temporary Injunction, Benham (and his related parties) are 

enjoined from retaining any originals or copies of materials, property, documents, data, and any 

other information obtained by Benham during his employment with Benham Ortho.93 The 

Plaintiffs seek to extend the injunctive protection to the Benham Debtor (and its related parties), 

ostensibly pursuant to Count 6 (Tortious Interference with Existing Contracts) (related to the 

Employment Agreement) and/or Count 7 (Violation of Delaware Uniform Trade Secrets Act). The 

elements of tortious interference with an existing contract under Texas law are set out above. In 

the case of the Delaware Uniform Trade Secrets Act (“DUTSA”), section 2002 of the DUTSA 

93 See Plaintiffs’ Exh. 2L, App. 158, ¶ f. 

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provides that “[a]ctual or threatened misappropriation may be enjoined.”94 For purposes of such 

provision, “misappropriation” includes the “[a]cquisition of a trade secret of another by a person 

who knows or has reason to know that the trade secret was acquired by improper means.” And 

“trade secret” is defined as “information, including a formula, pattern, compilation, program, 

device, method, technique or process that: a. [d]erives independent economic value, actual or 

potential, from not being generally known to, and not being readily ascertainable by proper means 

by, other persons who can obtain economic value from its disclosure or use; and b. [i]s the subject 

of efforts that are reasonable under the circumstances to maintain its secrecy.”95

In relation to Counts 6 and 7, pursuant to the TRO Application and Proposed TRO, the 

Plaintiffs request that the Benham Debtor (and its related parties) be enjoined from taking the 

following actions: 

Proposed TRO ¶ h). “Retaining any originals or copies of materials, property, 

documents, data, and any other information obtained by Benham during his 

employment with Benham Ortho.” 

Applying the TRO standards, the Court finds as follows: 

(1) Substantial Likelihood of Success. The above requested injunctive language does not 

cleanly tie to any of the APA Protections or EA Protections within the APA and Employment 

Agreement. At best, the proposed injunctive language loosely relates to language within the APA 

and Employment Agreement that is designed to protect trade secrets and other confidential 

information. But the proposed injunctive language does not expressly refer to either trade secrets 

or confidential information. Hence, because of the absence of a solid connection between the 

proposed injunctive language and any particular provision of the APA or Employment Agreement, 

the Court does not find that there is a substantial likelihood that the Plaintiffs will prevail on the 

merits of their tortious interference claim to the extent relied upon to pursue the broad injunctive 

language proposed above. Separately, in the case of the DUTSA, the only conduct of which the 

Plaintiffs have presented evidence took place in Texas. “The Delaware Uniform Trade Secrets 

Act, however, does not apply extraterritorially.”96 Therefore, the Court does not find that there is 

a substantial likelihood that the Plaintiffs will prevail on the merits of their DUTSA claim against 

the Benham Debtor. 

94 See 6 Del. C. § 2002(a). 

95 See 6 Del. C. § 2001(2)(a) and (4). 

96 Sorrento Therapeutics, Inc. v. Mack, C.A. No. 2021-0210-PAF, 2023 WL 5670689, at *29 (Del. Ch. Sept. 1, 2023). 

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(2) Other TRO Requirements. Because the Plaintiffs have failed to establish a substantial 

likelihood of success on any underlying claims, it is unnecessary to consider the other requirements 

for TRO relief. 

Therefore, the TRO Application will be denied in relation to the relief requested in ¶ h) of the 

Proposed TRO. 

7. Relief Sought Based Upon Accounting Claim 

With respect to Count 8 of the Plaintiffs’ Complaint (requesting an accounting), the 

Plaintiffs recognize that the ordering of an accounting is an equitable remedy that a court may 

provide in relation to determined liability on a cause of action.97 Here, there has not yet been a 

determination of liability on any cause of action. Notwithstanding same, pursuant to the TRO 

Application and ¶ q) of the Proposed TRO, the Plaintiffs request that Benham and the Benham 

Debtor be ordered to immediately provide a full inventory of all personal property removed from 

the Frisco Location and McKinney Location that cannot be returned to the Plaintiffs. 

Such request is premature, as there has been no determination of liability on an underlying 

cause of action. Additionally, the Plaintiffs have failed to substantiate how they will be irreparably 

injured in the absence of such relief. In this regard, the request only seeks information with respect 

to personal property that cannot be returned. Moreover, this is the type of information that the 

Plaintiffs may request through discovery. 

Consequently, the TRO Application will be denied to the extent of the requested relief in 

¶ q) of the Proposed TRO. 

8. Discovery-Based Relief Sought That is Not Tied to Particular Claim 

 Finally, pursuant to the TRO Application and ¶¶ o), r), s) and t) of the Proposed TRO, the 

Plaintiffs effectively request that Benham and the Benham Debtor (and their related parties) be 

97 See Complaint ¶ 126. 

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prohibited from taking any sort of action that would constitute the spoliation of evidence, and that 

Benham and the Benham Debtor be compelled to provide various forms of discovery-type 

information. These forms of relief are not appropriate for inclusion within a TRO under the facts 

and circumstances of this case. Every party to this litigation is under an obligation to prevent 

against the spoliation of evidence. And every party to this litigation is entitled to pursue discovery. 

As such, the TRO Application will be denied to the extent of the requested relief in ¶¶ o), r), s) 

and t) of the Proposed TRO. 

CONCLUSION 

 Based upon the foregoing, the Court will separately issue a temporary restraining order that 

grants in part, and denies in part, the TRO Application and grants temporary injunctive relief 

consistent with the terms hereof. 

# # # END OF MEMORANDUM OPINION # # # 

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