REVERSE in part; AFFIRM in part; Remand and Opinion Filed March 23, 2023 

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In The 

### Court of Appeals Fifth District of Texas at Dallas No. 05-21-00798-CV LACORE ENTERPRISES, LLC AN D LINK BIOSCIENCES, LLC, Appellants V. CLAIRE ANGLES, MICHEAL KE ARL, MICHAEL SMITH, THE VIRTUAL FORMULA, LLC, Appellees On Appeal from the 380th Judicial District Court Collin County, Texas Trial Court Cause No. 380-01127-2021 MEMORANDUM OPINION Before Justices Molberg, Pedersen, III, and Smith Opinion by Justice Molberg Appellants LaCore Enterprises, LLC (LaCore) and Link BioSciences, LLC (Link) appeal the denial by operation of law of their motion to dismiss appellees’ counterclaims pursuant to the Te xas Citizens Participation Act. 1 In one issue, appellants argue the trial cour t erred by failing to dismiss appellees’ counterclaims.

1 Because the counterclaims at issue here were filed on May 11, 2021, the 2019 TCPA amendments, which became effective September 1, 2019, apply in this case. See Act of May 17, 2019, 86th Leg., R.S., ch. 378, 2019 Tex. Sess. Law Serv. 684 (codified at T EX

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. C ODE §§ 27.001, .003, .005– .007, .0075, .009–.010).–2– Because we conclude some of appellees’ counterclaims are based on or in response to appellants’ exercise of the right to pe tition, we reverse in part the denial of appellants’ motion to dismiss and remand to the trial court. We otherwise affirm.
I. Background Appellants LaCore and Link filed their first amended petition and application for a temporary restraining order and for temporary and permanent injunctive relief on March 16, 2021. In thei r petition, appellants allege d appellee Michael Smith became the CEO of appellant Link, an a ffiliate of appellant LaCore, and Smith stayed for three years. Upon his depa rture from Link, Smith signed a separation agreement that prohibited him from usi ng or disclosing Link’s confidential information, trade secrets, and other pr oprietary information without Link’s written permission. Smith also was barred, fo r four months, from being employed by, consulting with, or having any interest in, any ownership interest in, or any activity involving customized nutrition or specialt y blending of nutritional products. The agreement also prohibited Smith from so liciting or entertaining inquiries from Link’s vendors or suppliers for twenty-four months. Appellants alleged Smith began compet ing against Link shortly after his departure. Two weeks after executing the Smith release agreement, he reinstated the corporate status of appell ee Virtual Formula, LLC (Vir tual). Smith was the cofounder and president of Virtua l, and his wife served as CE O. Virtual held itself out as a firm in “the field of individualized nutritional supplements and skin care.”–3– Appellants alleged that, by Fe bruary 2021, Virtual had in place over a dozen items of intellectual property and an executive t eam, an agreement with a lab processor and data analytics company, an agreemen t with a manufacturer, five DNA reports, software development, a capacity to pr ocess DNA, initial individualized formulas, pre-sales “across multiple ch annels,” and “strategic sa les and supplie r partnership conversations.” Appellants alleged appellee Michael K earl was the former chief technology officer for appellant LaCore, where he le arned the “science and technology behind individualized supplements.” On Ju ly 14, 2020, Kearl’s employment was terminated, and he executed a separati on agreement, which prohibited him from directly or indirectly using or disclosi ng LaCore’s confidential information, trade secrets, and other proprietary informatio n without LaCore’s written permission. LaCore never gave Kearl such permissi on. Appellee Claire Angles was an accounting clerk at LaCore, wh ere she executed an agreement to not disclose to third parties any of LaCore’s trade secrets or confidential information without LaCore’s written consent. Angles was also Kearl’s “live-in girlfriend.” While Angles was on administrative leave, Angles was info rmed on February 18, 2021 she was being terminated, but would continue to receive salary and be nefits for ninety days. Appellants alleged LaCore made Angles’ termination effective on March 9 after discovering an incident of intellectual pr operty theft described below. Appellants alleged LaCore served demand letters on Virtual, Smith, and Kearl on March 4,–4– 2021, “in connection with their (mis)use of LaCore, Link, and their affiliates’ confidential information for the purposes of competing with LaCore, Link, and their affiliates.” The next day, LaCore discovered Angl es, who was still receiving salary, had reset her LastPass password and “had begun copying and/or transferring LaCore’s trade secrets and/or confidential informa tion from LaCore’s data servers and online data storage to Angles’ personal Gmail acc ount.” Angles used the LastPass account to gain “the passwords necessary to fr eely access LaCore’s confidential and trade secret information including but not limited to financials, bank accounts, customer and vendor information, and personal bank account inform ation and emails for the vast network of independent distributors th at are paid by LaCore owned or supported MLM companies.” Angles did this, appellant s alleged, to disclose the confidential information to Kearl and Virtual, to give them “an economic advantage to compete with LaCore and its affiliates,” and “to in terfere with LaCore’s customers and/or vendors in an attempt to solicit thos e customers and/or vendors away from conducting business with LaCo re and its affiliates.” Appellants alleged Angles th en refused to meet with LaCore management to discuss the transfer of intellectual prop erty to Angles’ personal Gmail account. LaCore sought and obtained a temporary re straining order enjoining Angles from “further harming LaCore” and ordering her to return the stolen information.–5– LaCore sued Smith, Kearl, and Angles for breach of contract for violating their separation agreements and for breach of fiduciary duty. It sued Virtual, Smith, Kearl, and Angles for violations of the Texas Uniform Trade S ecrets Act. LaCore also applied for a temporary restraini ng order, and temporary and permanent injunctive relief, to restrain appellees from disclosing or using LaCore’s confidential information; accessing, transferring, downlo ading, or using LaCore’s confidential information; deleting, rem oving, or modifying any data on LaCore’s computers, databases, or servers; or taking any action that would im pair the value of LaCore’s assets, intellectual property, or confidential information. On May 11, 2021, appellees generally de nied appellants’ claims, asserted several affirmative defenses, and alleged counterclaims against appellants. In direct contrast to appellants, they claimed Kear l and Smith never disc losed any confidential or proprietary information of LaCore or Link. Appellees alleged that Viome—a possible investor in Smith’s startup—reached out to Smith, and that Smith was unaware Viome was also a LaCore custom er. When Smith learned Viome had a connection to LaCore, he told Viome he could not do business with an employee, vendor, or supplier of Link. Viome indi cated it was not an employee, vendor, or supplier of Link, and Viome “continued communicating with Smith with the desire that they form a partnership and eventually build a facility and process.” Smith told Viome that Virtual was fundraising, and Vi ome requested a confidential information memorandum (“IM”)—the formal fundrai sing document Virtual generated for–6– potential investors—which Smith sent to the CEO of Viome. Smith attended a business meeting at Viome “t o discuss the company’s futu re,” where he ran into LaCore’s owner, Terry LaCore. Afterwards, appellees alle ged Terry texted Smith: “I n light of the meeting legal is wanted [sic] to gear up to start se nding you letters and filin g in the courts for breach of your separation agreements. Woul d be nice if you and I could try to figure this out before all that time, money, and headaches happen for bot h of us.” The two spoke on the phone, and Terry told Smith he had invested over one million dollars in Viome inventory and had almost $750,000 in inventory remaining, and that he went to the meeting to possibly invest in Viome. Smith told Terry that he was unaware of that and that he would have “refused to negotiate with Viome” had he been aware. Smith told Terry he did not want to compete with LaCore and that he had an IM if he wanted a copy for purpose s of settlement or compromise negotiations and to demonstrate that Smith’s vision did not compete with LaCore. Terry requested Smith provide him with the IM to see if they could “resolve their dispute” “prior to any litigation being f iled.” The IM was se nt to Terry on Februa ry 23, 2021. According to appellees, the IM stated , among other things , it was “prepared on a confidential basis solely for the benef it of selected, qualified investors, and is not to be copied, distributed, or disclose d to third-parties without the prior written consent of [Virtual].” It stated that “[b]y accepting this information memorandum,–7– the recipient acknowledges that this documen t is proprietary and confidential[.]” Further, recipients agreed to the following: Hold and treat this Information Memorandum in the strictest confidence, and will not directly or indirectly disclose or permit anyone else to disclose this Information Memorandum to any other person, firm or entity, provided that recipient may disclose to its directors, executive officers, employees, counsel or accountants such information as is necessary for the proper evaluati on of this Information Memorandum if such persons are informed by reci pient of the confidential nature of this Information Memorandum and agree to be bound by the terms contained herein. Smith and Terry discussed se veral other topics, including why Smith was fired by Link, why Link refused to reimburse Sm ith for expenses Smith incurred during employment, and Viome. Th e call was “cordial and non- threatening.” Smith and Terry “continued to communicate on frien dly terms” until Marc h 2021. On March 10, 2021, a Viome representative e-mailed Sm ith, asking him to demonstrate that his contract allowed them to do business toge ther. Smith asked Viome to not contact him or Virtual again. According to Smith , “Viome and [Virtual ] never entered into any contractual relationship, either written or verbal, and the parties have had no discussion since.” Appellees alleged in their countercl aims that appellants violated the confidentiality agreement “contained in the IM by disclosing the contents of the IM to the general public by filing the petition,” which allegedly contai ned “the contents of the IM.” They alleged five paragra phs of the amended petition “are near wordfor-word copies” or quotations of statements in the IM. Appellees alleged appellants–8– did not receive prior written consent to c opy, distribute, or disclose the IM’s
contents. Appellees further alleged Angles, in January 2021, bega n having problems with her work laptop. The laptop’s disp lay cracked, making it impossible to use. The director of IT helped Angles upload particular items from the laptop to a cloud drive so she could work from another com puter. Angles “understood LaCore was aware of this upload” and approved it. Appellees alleged that, on January 26, 2021, LaCore’s general counsel, Jenifer Grace, informed Angles she needed to e nd her romantic relati onship with appellee Kearl, the former chief technology officer of LaCore. Accordi ng to Angles, Grace told her to move out of her shared home w ith Kearl “as it would, according to Grace, more than likely ‘go into fo reclosure’” because he could not afford the house on his

own. Angles was placed on temporary ad ministrative leave from LaCore on the same day. She believed the reason for th e leave was her relationship with Kearl. Angles was told on February 18, 2021, th at she was being terminated and would receive salary and benefits for ninety days . She was told she was terminated because she was no longer a good fit for LaCore. Appellees further alleged in their counterclaims that, “[s]ince before February 26, 2021, Angles has not ac cessed, downloaded, or c opied any LaCore-related material to which Angles had access while she was employed by LaCore.” Angles–9– believed her access to e-mail and work files was removed by February 2, 2021. On March 5, 2021, Angles acce ssed her LastPass account, wh ich was connected to her LaCore e-mail address, to recover a password for her bank account to pay her mortgage. Angles did not believe any of the passwords stored in her LastPass “vault” were functional at that time. Sh e did not “use any L aCore-related passwords or credentials to access any documents or information bel onging or related to LaCore”; instead, she exported to her person al computer only the list of her personal passwords. Angles was not employed by, did not work with, and had no business dealings with Smith, Kearl, or Virtual, nor did she ever disclose any confidential or proprietary information to any third partie s, including Kearl, Smith, and Virtual. Though Angles was in a roma ntic relationship with Ke arl and owns a home with him, she was not privy to a ny information regarding Kear l’s business dealings with Smith or Virtual. Appellees alleged Angl es could not meet on March 5 because she had a sick child at home. When she informed LaCore about this circumstance, she heard nothing further. At no point did anyone at LaCore “attempt to talk to Angles about an[] alleged ‘data breach’ or any of the allegations made in the petition.” Appellees also alleged that appellant s published defamatory statements in their petition. They alleged the petition’s statement that Smith left Link to compete was false. Smith, instead, was replaced as CEO and then fired from Link. After he failed to secure any other opportunities, he decided to start his own company. Appellees allege the petition’ s statement that Smith reinstated Virtual to compete–10– with appellants was false. Instead, he di d so to collect commissions from Uforia Science, an affiliate of LaCore, which he was owed “under the [Virtual] name.” Grace, LaCore’s general c ounsel, was “aware of this and understood it was for commissions and not to compete . . . .” Appellees alleged the petition’s statement that Angles copied or transferred LaCore’s trade secrets or confidential information from LaCore’s servers to Angles’ Gmail acc ount was false. They also alleged the petition’s statement that Angles gained the passwords necessary to freely access LaCore’s confidential and trade secret information by impr operly accessing the LastPass account was false, and the petition’s statement that Angles accessed LaCore’s accounts to disclose confidential information to third parties to give them an advantage was false. Appellees alleged Virtual ha d not received any money in revenue from selling DNA custom supple ments except for the above-mentioned commission received from Uforia. Appellees alleged the petition’s statement that Angles copied or transferred LaCore’s c onfidential informati on to interfere with LaCore’s customers or vendors to solicit them away from LaCore and its affiliates was false; Angles never cont acted any of LaCore’s or its affiliates’ customers or vendors. Appellees alleged th e petition’s statement that Angl es refused to meet after LaCore learned of the data breach was false because LaCore did not request a meeting to discuss any alleged data breach. Appellees alleged the petition’s statement that Smith, Kearl, and Virtual us ed and disclosed appe llants’ confidential information for appellees’ pe rsonal and business enrichme nt was false; appellees–11– had not received, disclosed, or used any such confidential info rmation from Angles or anyone else. Based on the above, appellees br ought counterclaims for business disparagement, defamation, retaliation, unlaw ful termination, abuse of process, antitrust violations, breach of contract, fra ud, TUTSA violations, unfair competition, tortious interference with contract, tortio us interference with business relations, and several declaratory judgments. Appellees also sought a temporary and permanent injunction. In appellees’ business disparagement clai m, they asserted “[appellants], by their petition, have publishe d false and disparaging info rmation about Smith, Kearl, and [Virtual].” Regarding defamation, they asserted appellants “have published false statements of facts to third parties with the requisite level of fault.” Third, in their retaliation claim, appe llees asserted, “Angles enga ged in a protected activity while still employed at LaCore,” which to ok adverse action against Angles based on that protected activity. In appellees’ unlaw ful termination claim, appellees asserted LaCore unlawfully terminated Angles fro m her employment with LaCore based on her sex and in retaliation for pr otected activities. Appellees alleged in their abuse of process action that appellants “made an ille gal, improper, or pe rverted use of the process which was a use neither warranted nor authorized by the process.” For their anti-trust violations claim, appellees assert ed appellants violated section 15.05(a) of the business and commerce code because they “engaged in a combination or–12– conspiracy in restraint of tr ade or commerce which is unl awful.” Further, appellees alleged appellants violated section “ 15.05(b) because they have monopolized, attempted to monopolize, or conspired to monopolize any part of trade or commerce.” In their breach of contract clai m, appellees asserted Virtual and LaCore “entered into a valid agreement both pertaini ng to and consisting of the Confidential Information Memorandum,” and LaCore breach ed that agreement by “disclosing the contents of the confidential agreement.” A ppellees asserted in their fraud claim that LaCore knowingly or recklessl y made a material represen tation to Smith and Virtual that was false to induce them to act upon th e representation, Smith and Virtual relied on the representation and were injured as a re sult. In their TUTSA violations claim, appellees asserted the IM was a trade s ecret of Virtual that appellants obtained through “improper means and improperly disclo sed to third-parties.” In their unfair competition claim, appellees asserted appellants “unfairly appropriated and used Smith and [Virtual’s] confidential info rmation memorandum,” which was “a unique pecuniary interest created by [appellees] thr ough the expenditure of labor, time, skill, and money.” In their first tortious inte rference with contract claim, appellees asserted Virtual had contracts with third pa rties that were willfully and intentionally interfered with by appellants. In their tortious interfer ence with business relations claim, Virtual asserted it had “prospective c ontractual or business relations with third parties,” and appellant s engaged in conduct that was e ither “independently tortious or unlawful which interfe red with VF’s prospectiv e contractual and business–13– relations.” In Kearl’s declaratory judgm ent action against LaCore, Kearl sought a declaration that (a) his separation agreem ent with LaCore does not prevent him from working for a competitor of LaCore, (b) hi s separation agreemen t with LaCore does not prevent him from working in the DNA-based custom nutrition supplement industry, and (c) he is permitted to work for a DNA-based custom nutrition supplement company as long as he is not di sclosing or using LaCore confidential information. In Smith’s declaratory j udgment action against Link, Smith sought a declaration that (a) his separation agr eement with Link does not prevent him from working for a competitor of Link after a da te certain, (b) his separation agreement with Link does not prevent him from working in the DNA-based custom nutrition supplement industry, and (c ) he is permitted to work for a DNA-based custom nutrition supplement company as long as he is not disclosing or using Link’s confidential information. Finally, Virtual sought a declaration that particular items do not constitute trade secrets owned or licensed by Link or L aCore and therefore such items cannot be the basis for a trad e secret misappropriation claim against Virtual. On June 14, 2021, appella nts filed a TCPA motion to dismiss appellees’ counterclaims. They sought dismissal of appellees’ counterclaims, arguing they were based on or in response to appellant s’ “protected communications and actions” in the lawsuit. They sought the di smissal of appellees’ counterclaims for defamation, business disparagement, breach of contract, abuse of process, TUTSA–14– violations, unfair competition, anti-trust vi olations, and tortious interference with existing and potential business, as well as th eir counterclaims for declaratory relief, and appellee Angles’ counterclaims for re taliation and unlawful termination. Appellants did not seek dismissal of th e fraud counterclaim. Appellants’ motion was denied by operation of law. See T EX
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II. Discussion “The [TCPA] protects citizens who pe tition or speak on matters of public concern from retaliatory lawsuits that s eek to intimidate or silence them.” In re Lipsky , 460 S.W.3d 579, 584 (Tex. 2015) (citing T EX
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. C ODE § 27.001–.011) (footnote omitted). Its purpos e “is to encourage and safeguard the constitutional rights of persons to petiti on, speak freely, associate freely, and otherwise participate in government to the maximum extent permitted by law and, at the same time, protect the rights of a person to file meritorious lawsuits for demonstrable injury.” T EX
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. C ODE § 27.002. Under the TCPA, a party may file a mo tion to dismiss a legal action “based on” or “in response to a party’s exercise of the right to free speech, right to petition, or right of association[.]” Id . § 27.003(a). A three-step decisional process follows. First, the trial court must dismiss the le gal action “if the moving party demonstrates that the legal action is based on or is in response to: (1) the party’s exercise of: (A) the right of free speech; (B) the right to pe tition; or (C) the right of association; or (2) the act of a party desc ribed by Secti on 27.010(b).” Id . § 27.005(c).–15– Second, the court “may not dismiss a legal action under this section if the party bringing the legal action establishe s by clear and specific evidence a prima facie case for each essential elem ent of the claim in question.” Id . § 27.005(c). This prima facie standard requires the nonmova nt to bring forth “only the minimum quantum of evidence necessary to support a rational inference that the allegation of fact is true.” In re E.I. DuPont de Nemours & Co. , 136 S.W.3d 218, 223 (Tex. 2004) (internal quotation marks omitted). Prima faci e evidence is evidence that will suffice as proof of a fact in issue; “[i]n other wo rds, a prima facie case is one that will entitle a party to recover if no evidence to the cont rary is offered by the opposite party.” Serafine v. Blunt , 466 S.W.3d 352, 358 (Tex. A pp.—Austin 2015, no pet.). Finally, the court must dismiss the lega l action if the movant “establishes an affirmative defense or othe r grounds on which the moving party is entitled to judgment as a matter of law.” T EX
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. C ODE § 27.005(d). “Legal action” under the TC PA “means a lawsuit, cau se of action, petition, complaint, cross-claim, or counterclaim or any other judicial pleading or filing that requests legal, declaratory, or equitable relief.” Id . § 27.001(6). “Exercise of the right to petition” means, among other things , a communication in or pertaining to a judicial proceeding. Id . § 27.001(4). “‘Communication’ includes the making or submitting of a statement or document in any form or medium, including oral, visual, written, audiovisual, or electronic.” Id . § 27.001(1). Judicial proceeding means an actual, pending judicial proceeding. Levatino v. Apple Tree Cafe Touring, Inc. , 486–16– S.W.3d 724, 728 (Tex. App. —Dallas 2016, pet. deni ed). A communication “pertaining to” a judicial proceeding does not include anticipated or potential future judicial proceedings. Id . “To trigger the TCPA’s protection, the ‘legal action’ must be factually predicated on the alleged co nduct that falls within the scope of the TCPA’s definition of the exercise of the right to petition.” Sorkin v. P.T. Atlas Mfg.,
L.L.C. , No. 05-21-00657-CV, 2022 WL 780444, at *3 (Tex. App.—Dallas Mar. 15, 2022, pet. denied) (mem. op.). Exercise of the right of free speech means “a communication made in connection with a matter of public concern.” T EX
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. C ODE § 27.001(3). Matters of public concern include statements or activities regarding “a matter of political , social, or other interest to the community[,]” or “a subject of concern to the public.” Id . § 27.001(7). But “[a] private communication made in connection w ith a business dispute is not a matter of public concern under the TCPA.” Erdner v. Highland Park Emergency Ctr., LLC , 580 S.W.3d 269, 276 (Tex. App.—Da llas 2019, pet. denied). When the text of the TCPA dictates the outcome of a case, we review the trial court’s ruling de novo. Creative Oil & Gas, LLC v. Lona Hills Ranch, LLC , 591 S.W.3d 127, 132 (Tex. 2019). In our review, we consider “the pleadings, evidence a court could consider under Rule 166a, Texas Rules of Civil Procedure, and supporting and opposi ng affidavits stating the facts on which the liability or defense is based.” T EX
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. C ODE § 27.006(a); Dyer v. Medoc Health Services, LLC , 573 S.W.3d 418, 424 (Tex. App.—Da llas 2019, pet. denied).–17– In construing the TCPA, we must de termine and give effect to the Legislature’s intent. See City of San Antonio v. City of Boerne , 111 S.W.3d 22, 25 (Tex. 2003). The best guide to what lawm akers intended is the enacted language of a statute, “which necessarily includes any enacted statements of policy or purpose.” Youngkin v. Hines , 546 S.W.3d 675, 680 (Tex. 2018) . Moreover, we determine legislative intent from considering an act as a whole rather than its parts in isolation. City of San Antonio , 111 S.W.3d at 25. We construe the statute’s words “according to their plain and common meaning, unless a contrary intention is apparent from the context, or unless such a construc tion leads to absurd results.” City of Rockwall v. Hughes , 246 S.W.3d 621, 625–26 (Tex. 2008) (cit ations omitted). We “may not judicially amend a statute by adding words th at are not contained in the language of the statute.” Lippincott v. Whisenhunt , 462 S.W.3d 507, 508 (Tex. 2015). Exemptions waived Appellees argue the “commercial speech” exemption under section 27.010(a)(2) applies to its counterclaims , and alternatively, they argue the “employee-employer” exemption under sec tion 27.010(a)(5) app lies. Appellants respond, in the first place, that appellees fa iled to raise these arguments in the trial court and thus failed to preserve them fo r appeal. We agree with appellants. The non-movant bears the burden of prov ing a statutory exemption applies to its legal action. Kirkstall Rd. Enterprises, Inc. v. Jones , 523 S.W.3d 251, 253 (Tex. App.—Dallas 2017, no pet.). To preserve a complaint for a ppellate review, the–18– record must show that a party made th e complaint to the trial court by a timely request, objection, or motion that stat ed the grounds for the ruling that the complaining party sought from th e trial court with sufficien t specificity to make the trial court aware of the complaint. T EX
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. P. 33.1. Accordingly, the nonmovant waives a contention on appeal that one of the statutory exemptions under section 27.010 applies if the non-movant fa iled to raise the contention in the trial
court. See Baumgart v. Archer , 581 S.W.3d 819, 826 n.4 (Tex. App.—Houston [1st Dist.] 2019, pet. denied); Elite Auto Body LLC v. Autocraft Bodywerks , Inc., 520 S.W.3d 191, 206 n.75 (Tex. App.—Aus tin 2017, pet. dism’d). Appellees did not raise in the trial c ourt their two arguments relating to the commercial speech and employee-employer exemptions. Consequently, this issue is not preserved for our review. See T EX
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. P. 33.1. Business disparagement and defamation Step one. Appellants argue that, on thei r face, appellees’ business disparagement and defamation counterclai ms are based on or in response to communications made by appellants in a judicial proceeding—specifically, statements made in their petition. As described above, appellee’s business disparagement counterclaim alleged appella nts, “by their petition, have published false and disparaging information about Sm ith, Kearl, and [Virtual].” Under their defamation counterclaim, appellees stated more generally th at appellants “have published false statements of fact to third pa rties with the requisite level of fault.”–19– Elsewhere in in appellees’ counterclai ms, however, appellants described the allegedly defamatory statem ents, stating, “Several of the material statements contained in the petition are false and defamatory and cannot be proven by any competent and reliable evidence.” Appellees then discussed several statements in the petition, explaining why they were false. We agree with appellants that, on their face, these two counterclaims are base d on appellants’ petition, which is a communication made in a judicial procee ding. We conclude appellants have demonstrated these counterclai ms are based on or in response to appellants’ exercise of their right to petition. See T EX
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. C ODE § 27.005(b). Step two. We now consider whether appell ees have established by clear and specific evidence a prima facie case for each element of their business disparagement and defamation claims. To prevail on a business disparag ement claim, a plaintiff must establish that (1) the defendant pub lished false and disparaging information about it, (2) with malice, (3) without privileg e, (4) that led to special damages to the plaintiff. Choctaw Constr. Servs. LLC v. Rail-Life R.R. Servs., LLC , 617 S.W.3d 143, 152 (Tex. App.—Houston [1st Dist.] 2020, no pet.). To pr evail on a defamation cause of action, the plaintiff must prove th e defendant (1) published a false statement about the plaintiff (2) that was defamatory (3) while acting with either actual malice, if the plaintiff was a public official or pub lic figure, or negligence, if the plaintiff was a private individual, regardi ng the truth of the statement. Williams v. City of Dallas , 53 S.W.3d 780, 789 (Tex. App.—Dallas 2001, no pet.). A plaintiff must–20– further prove specific damages unless the offending publication is defamatory per

se. In re Lipsky , 460 S.W.3d 579, 596 (Tex. 2015). “D efamation per se refers to statements that are so obviously harmful that general damages, such as mental anguish and loss of reputation, are presumed.” Id . Remarks that adversely reflect on a person’s fitness to conduct his or her business or trade are also deemed defamatory per se. Id . Here, we do not think the st atements Smith alleged can be implied—that Smith’s separation agreem ent prevented him from working with Viome—were defamatory per se. Id . The implied statements were neither “obviously harmful” nor re lated to Smith’s “fitness to conduct his business.” Id

. Accordingly, appellees were required to prove damages not just for their business disparagement claim but also their defamation claim. Appellees point to Smith’s affidavit submitted in response to appellants’ TCPA motion to dismiss as evidence for thes e two claims. Smith stated Virtual had not received or solicited any money from selling DNA-custom supplements and he did not begin fundraising for Virtual un til his non-compete obligations under his separation agreement had been fulfilled. Regardless, Smith stated Link did not sell products to the public, and that Virtual an d Link therefore could not be in the “same marketing space.” Smith stated he was contacted by Viome on October 19, 2020, and he notified it he was “still bound by non-compete provi sions of the agreement with Link”

— communications ceased. Smith c ontacted Viome in January 2021, looking for referrals. He le arned Viome “wanted to expa nd and end the relationship–21– between Viome and LaCore.” Before this time, Smith was una ware Viome had a relationship with LaCore or Link. Smith told Viome he could not do business with any entity that was an employee, vendor, or supplier of Link. Viome told Smith it was not an employee, vendor, or supplier of Link, though it confirmed it did business with LaCore. Viome wished to form a partnership with Virtual or Smith. Smith declined employment and stock options with Viome, but he informed Viome that Virtual was fundraising and provided it wi th Virtual’s information memorandum. A few days later, Smith rece ived a text message from Te rry—LaCore’s owner—stating that, after meeting with Viome, LaCore’s legal team wanted to go after Smith for breaching his separation agreement but Terry wanted to “figure this out before all that.” Terry and Smith then had a conve rsation about Viome, during which Smith learned about Terry’s investments with Viome. Smith provided Terry with the information memorandum to try to show him he did not want to compete with LaCore directly. Smith explained to Te rry the memorandum wa s confidential, and Terry agreed not to share it with anyone el se. Smith received an email on March 10, 2021, from Viome asking him to prove that his contract allowed Smith and Viome to do business together. Smith alleged the email “implie[d] that he spoke to Terry and that Terry told him [Smith] was prohi bited from doing business with Viome, which is false.” Smith requested Viome ne ver to contact Virtual or Smith again. Smith alleged that, as a result of Terry or LaCore “falsely stating to third parties, including Viome, that [he] could no t do business in the DNA-based nutrition–22– supplement industry, Viome and [Virtual ] never entered into any contractual relationship . . . and the parties have had no discussion since.” Smith stated that Terry’s communications with Viome ultim ately resulted in Virtual losing a $1,250,000 contract. Smith also alleged “disparagement from LaCore’s group of contacts” included comments to employees , vendors, suppliers, and other LaCore entities that Smith or Virtual used proprieta ry information to bu ild Virtual, while “poaching Uforia customers”

— both of which Smith stated are false. We conclude appellees failed to establish by clear and specific evidence a prima facie case for each element of th eir business disparagement and defamation claims. Specifically, they failed to pr ovide clear and specific evidence that appellants made false statements about Sm ith or Virtual and that appellees were damaged as a result. First, Smith’s affidavit was conclusory and speculative regarding any defamatory statements made by Terry or LaCore . The best Smith offers is his suggestion that Viome’s email, asking him to demonstrate he could work with Viome under his separation agreement, “implie[d] that [Viome] spoke to Terry and that Terry” told Viome that Smith could not work with them. This fails to meet the “clear and specific evidence ” standard required by the TCPA. 2 Otherwise, Smith’s affidavit assumed LaCore or Terry made false statements, but failed to provide clear and specific evid ence that they did so. Second, appellees failed to

2 “‘Clear’ means ‘free from doubt,’ ‘sure,’ or ‘unambiguous.’” Serafine v. Blunt , 466 S.W.3d 352, 358 (Tex. App.—Austin 2015, no pet.).–23– provide clear and specific evidence they suffered damages as a result of any defamatory statements. Smith’s conclu sory statement that Terry’s “communication with Viome ultimately resulted in [V irtual] losing a $1,250,000 contract” is contradicted elsewhere in the affidavit. Smith stated that, after Viome asked him to demonstrate he was free to work with th em under his separation agreement, Smith himself cut off further communications with Viome, telling Viome never to contact him again. Thus, any loss of business seemingly resulted from Smith ending his business relationship with Viome. We conclude appellees faile d to establish by clear and specific evidence that appellants published false statem ents about Smith or Virtual or that Smith or Virtual suffered any damages as a result. Accordi ngly, we conclude th e trial court erred by failing to dismiss appellees’ business disparagement and defamation claims. Breach of contract, TUTSA violation, and unfair competition Step one . In its breach of contract count erclaim against LaCore, appellees alleged Virtual and LaCore “entered into a valid agreement both pertaining to and consisting of the confidential informatio n memorandum.” They alleged LaCore breached the agreement “by disclosing the c ontents of the confidential agreement.” Appellees asserted in their TUTSA viola tions counterclaim that the information memorandum constituted Virtual’s trade secret and appellants “improperly disclosed [it] to third-parties.” In thei r unfair competition c ounterclaim, appellees–24– alleged appellants “unfairly ap propriated and used Smith and [Virtual’s] confidential information memorandum.” Appellees primarily alleged disclosu re of the information memorandum through appellants’ petition, but they also point to evidence that appellants disclosed the memorandum to its lawyer in this case, Carlisle Braun, and to its general counsel, Jenifer Grace. Smith stated in his affida vit attached to appellees’ response to the TCPA motion that Terry LaCore disclose d the contents of the memorandum to Braun and Grace, who, he stated, “were not just attorneys for LaCore, but also other third-party companies such as Uforia[.]” Sm ith stated that the “f act the Confidential IM was disclosed to others, including Jeni fer Grace, is evidenced by the affidavits attached to Plaintiffs’ own pleadings . . . .” In Grace’s affidavit, attached to appellants’ TCPA motion, she stated she received a copy of Virtual’s information memorandum shortly after January 26, 2021. As noted above, communications made regarding anticipated or potential future judicial proceedings are not communications pertaining to judicial proceedings under the TCPA. See Levatino , 486 S.W.3d at 728. Thus, LaCore’s disclosure of the informati on memorandum to his lawyers before the suit was filed was not a communication made in or pe rtaining to a judicial proceeding. See QTAT BPO Sols., Inc. v. Lee & Murphy Law Firm, G.P. , 524 S.W.3d 770, 777–78 (Tex. App.—Houston [14th Dist.] 2017, pet. denied) (following Levatino and concluding the appellant’s disclosure of confidential in formation to its lawyers prior to initiation–25– of litigation relating to the confidential information was not a communication made in or pertaining to judicial proceeding). We conclude a ppellants have not established the TCPA applies to these communications , and appellants’ motion to dismiss was properly denied as to these communications. However, appellants were undoubtedly exercising their right to petition by making statements and allegations in thei r petition. Appellees’ counterclaims for breach of contract, TUTSA violation, and unfair competition were, in part, based on appellants’ petition insofar as appellees allege disclosure of the information memorandum in the petition. Accordi ngly, we conclude appellants have demonstrated these counterclaims—to the extent appellees seek to recover for appellants’ statements in the petition—are based on appellants’ exercise of their right to petition. See T EX
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. C ODE § 27.005(b); Rose v. Wash , No. 05-22-00289-CV, 2022 WL 17750750, at *3 (T ex. App.—Dallas Dec. 19, 2022, no pet. h.) (mem. op.) (concluding a legal action was only par tly based on or in response to the movant’s exercise of the right to petition). Step two. To prevail on a breach of contract claim, a plaintiff must establish the following elements: (1) a valid contract existed between plai ntiff and defendant; (2) plaintiff tendered performance or wa s excused from doing so; (3) defendant breached the terms of the contract; and (4) plaintiff sustained damages as a result. Atrium Med. Ctr., LP v. Houston Red C LLC , 546 S.W.3d 305, 311 (Tex. App.— Houston [14th Dist.] 2017), aff’d , 595 S.W.3d 188 (Tex. 2020).–26– The elements of the tort of unfair co mpetition by misappropriation are (1) the creation of plaintiff’s product—the trad e secret information—through extensive time, labor, skill, and money; (2) defendant’s use of that product in competition with plaintiff, thereby gaining a special advant age in that competition because defendant is burdened with little or none of the expense incurred by plaintiff; and (3) commercial damage to plaintiff. Baylor Scott & White v. Project Rose MSO,
LLC , 633 S.W.3d 263, 287 (Tex. App.—Tyl er 2021, pet. denied). “The elements of a claim for violation of TUTSA are (1) ow nership of a trade secret; (2) misappropriation of the trade secr et; and (3) an injury to the plaintiff or unjust enrichment to the defendant.” Morrison v. Profanchik , No. 05-17-01281-CV, 2019 WL 3798182, at *5 (Tex. A pp.—Dallas Aug. 13, 2019, no pet.) (mem. op.). Each of these claims requires proof of damages suffered by the plaintiff, or in the case of the TUTSA violati on claim, “an injury to the plaintiff.” Appellees argue Smith’s statement that the disclosure of Virtual’s confidential information “reduced the value [of] such information” and that appellees have furt her suffered “because of the attorney’s fees that have been incurre d” is evidence of damages. We disagree. Smith’s statement that any disclosure of the memorandum reduced the value of the information is conclusory and does not m eet the clear and specific standard required by the TCPA. Furthermore, generally attorn ey’s fees incurred in a lawsuit are not “actual damages.” See Worldwide Asset Purchasing, L.L.C. v. Rent-A-Ctr. E., Inc. , 290 S.W.3d 554, 572 (Tex. App. —Dallas 2009, no pet.). We conclude the trial court–27– erred by failing to dismiss appellees’ bre ach of contract, TUTSA violation, and unfair competition claims insofar as they were based on the petition. Retaliation and unlawful termination Step one. Appellants argue Angles’ re taliation and unlawful termination claims against LaCore are “based on or brought in response to LaCore’s communications in connection with a matte r of public concern” in light of the “circumstances surrounding Angles’ pl acement on administrative leave and Defendants’ contention that he r termination was part of such leave[.]” Appellants argue these communications “related to potential sex crimes . . . .” In its retaliation claim, a ppellees alleged that “Angles engaged in a protected activity while still employed at LaCore,” LaCore took adverse employment action based on that protected activity, and a causal connection existed between the protected activity and the adverse employm ent action “because LaCore used the protected activity as the basis for” termin ating Angles. Appellees alleged in their unlawful termination claim that Angles was unlawfully terminated from LaCore based on her sex and in reta liation for protected activities. Reviewing the rest of appellees’ counterclaims, the factual basis for these counterclaims appears to be Angles’ belief that she was fired for her relationship with Kearl and for not ending the relationship. We reject appellants’ cont ention that these two counterclaims are based on or in response to appellants’ exercise of its right to free speech on a matter of public–28– concern. We fail to see how Angles’ allegation that she was fired for he r relationship with Kearl is based on or in response to appellants’ speech simply because appellants made communications regarding Kearl’s conduc t or character. Of course, appellants contend Angles was placed on leave and te rminated for reasons other than those alleged by Angles, but we do not determine the nature of appellees’ counterclaims by looking to appellants’ contentions. Ther efore, we conclude appellants have failed to demonstrate appellees’ reta liation and unlawful termina tion claims are subject to the TCPA. See T EX
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. C ODE § 27.005(b). Abuse of process Step one. Appellants argue appellees’ abuse of process counterclaims are “by their nature based on or brought in respons e to communications made in a judicial proceeding.” Appellees alleged in their counterclaims that appellants “made an illegal, improper, or perverted use of the process[,] which was [ ] neither warranted nor authorized by the process. ” The elements of an abus e of process claim include (1) an illegal, improper, or perver ted use of the process, neither warranted nor authorized by the proc ess, (2) an ulterior motive or purpose in exercising such use, and (3) damages as a re sult of the illegal act. To constitute an abuse of proce ss, the process must have been used to accomplish an end which is be yond the purview of the process and which compels a party to do a collate ral thing which he could not be compelled to do. The criti cal aspect of this tort is the improper use of the process after it has been issued. Stated another way, the original issuance of process is justified, but the process itself is later used for a purpose for which it was not intended. When the process is used for the purpose for which it was intended, even though accomplished by an ulterior motive, no abuse of process has occurred.–29– Preston Gate, LP v. Bukaty , 248 S.W.3d 892, 897 (Tex. A pp.—Dallas 2008, no pet.). “Process” in this context refe rs to the range of procedures incident to litigation. See Warner Bros. Entm’t, Inc. v. Jones , 538 S.W.3d 781, 816 (Tex . App.—Austin 2017) (finding no cases “where a valid abuse- of-process claim involved something other than the commencement of the judici al process against the defendant”), aff’d , 611 S.W.3d 1 (Tex. 2020). Given th e nature of abuse of process claims, in light of the allegations in appellees’ counterclaims, we conclude appellants have demonstrated appellees’ abuse of process counterclaim is based on or in response to appellants’ exercise of their right to petition. See T EX
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. C ODE § 27.005(b). Step two. As stated above, the elements of abuse of process are (1) an illegal, improper, or perverted use of the process, neither warranted nor authorized by the process, (2) an ulterior motive or purpose in exercising such use, and (3) damages as a result of the illegal act. Bukaty , 248 S.W.3d at 897. Appellees point to Smith’s statement in his affidavit that the CEO of Uforia, Kevin Raulston, “stated that LaCore’s and Uforia’s goal was to make it so that ne ither [Virtual] nor [Smith] directly could poach Uforia’s customers fo r at least the next year.” While this evidence arguably goes to the second el ement—“ulterior motive”—appellees have not put forth any evidence of the first: that appellants made an “ illegal, improper, or perverted use of the process. ” Accordingly, we conclude appellees failed to prove by clear and specific evidence a prima facie case of its abuse of process counterclaim, and the tria l court erred in failing to dismiss the claim.–30– Anti-trust violations Step one. Appellees alleged in their c ounterclaims in their anti-trust violations claim that appella nts “engaged in a combination or conspiracy in restraint of trade or commerce which is unl awful” and “monopolized, attempted to monopolize, or conspired to monopolize any pa rt of trade or comm erce.” Appellees provide no other details in their counterclai ms explaining the basis for this claim. However, the only factual allegations that could plausibly underly these claims are the allegations that LaCore used its lawsu it, including its application for injunctive relief, to stop appellees from competing. Appellees argue this counterclaim is not based on or in response to this lawsuit, “b ut upon the systematic effort by appellants to prevent Smith, Kearl, and [Virtual] fr om engaging in” business or competing. However, they point to nothing specifi c beyond the lawsuit as constituting this systematic effort. Thus, considering th e factual allegations made in appellees’ counterclaims, we conclude this claim, too, is based on appellants’ exercise of their right to petition. See T EX
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. C ODE § 27.005(b). Step two . To establish that a defendant contracted, combined, or conspired in restraint of trade in violation of sec tion 15.05(a), a plaintiff must show that the alleged contract, combination, or conspi racy is unreasonable and has an adverse effect on competition in the relevant market. Marlin v. Robertson , 307 S.W.3d 418, 427 (Tex. App.—San Antonio 2009, no pet.); T EX
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. C ODE § 15.05(a). Appellees were thus required to prove (1) a contract, comb ination, or conspiracy, (2)–31– which is unreasonable, and (3) has an adve rse effect on competition in the relevant market. W. Mktg., Inc. v. AEG Petroleum, LLC , 616 S.W.3d 903, 915 (Tex. App.— Amarillo 2021, pet. denied). For anticom petitive conduct to give rise to liability under section 15.05(a) of the Texas Antitrust Act, the conduct must arise out of an agreement, rather than from independent action. AMC Entm’t Holdings, Inc. v. iPicGold Class Entm’t, LLC , 638 S.W.3d 198, 208–09 (Tex. 2022). Because antitrust law “does not prohibit unreasonab le restraints of trade as such—but only restraints effected by a contract, combination, or conspiracy—it leaves untouched a single firm’s anticompetitive conduct,” short of threatened monopolization. Id . at 209. To prove an adverse effect on competition, th e plaintiff must bring forth evidence of “‘demonstrable economic effe ct,’ not just an inference of possible effect.” CocaCola Co. v. Harmar Bottling Co. , 218 S.W.3d 671, 689 (Tex. 2006). “[O]nly those restraints that actually have an adverse effect on competition in a market, as opposed to merely hurting a competitor,” are condemned by anti-trust law. Regal Entm’t Group v. iPic-Gold Class Entm’t, LLC , 507 S.W.3d 337, 348 (Tex. App.—Houston [1st Dist.] 2016, no pet.). Appellees argue Smith’s statements that the CEO of Uforia , a LaCore entity, stated that LaCore wished to “tie up” a ppellees so they could not lure appellants’ customers away over the course of the ne xt year support their claim for unlawful restraint of trade. They also point to LaCore and Uforia’s li tigation against Smith and Virtual and Uforia’s trademark laws uit against Smith and Virtual. Even–32– assuming this is evidence of an unreas onable combination, appellees failed to produce evidence of an adverse effect in the market—an inference of possible effect is not enough. See Harmar Bottling Co. , 218 S.W.3d at 689. Accordingly, we conclude appellees failed to provide clea r and specific evidence establishing their anti-trust claim, and the trial court theref ore erred by failing to dismiss the claim. Tortious interference Step one . Under Virtual’s tortious inte rference counterclaims, appellees alleged Virtual “had contracts with third parties” and “had prospective contractual or business relations with third parties” th at appellants interfered with. Here, again, appellees fail to describe in their countercl aims the factual base s for these causes of action. Appellants argue these counterclai ms are based on their lawsuit and issuance of injunctive relief against appellees, “as [appellees] cont end these protected actions have wrongfully interfered with [Virtual’s ] business.” Considering the entirety of appellees’ factual allegations, we agree. Appellees alleged appellants improperly disclosed Virtual’s information memorandum through filing their petition, and that the petition made two defamatory statem ents regarding Virtual: that it was reconstituted to compete with LaCore and th at Virtual used appellants’ confidential information. We conclude appellees’ tortious interference counterclaims are in response to appellants’ exercise of their right to petition. See T EX
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. C ODE § 27.005(b).–33– Step two . Appellees allege both that appellants tortiously interfered with an existing contract and tortiously interfered w ith a prospective contract. The elements of tortious interference with an existing contract are: (1) an existing contract subject to interference; (2) a willful and intentiona l act of interference w ith the contract; (3) that proximately caused the plaintiff's inju ry; and (4) caused actual damages or loss. Tex. Integrated Conveyor Sys., Inc. v. Innovative Conveyor Concepts, Inc. , 300 S.W.3d 348, 367 (Tex. App.—Dalla s 2009, pet. denied). To prove a cause of action for tortious interference with a prospectiv e contract, a plaintiff must establish the following elements: (1) a reasonable probab ility that the parties would have entered into a business relationship; (2) an inte ntional, malicious intervention or an independently tortious or unlawful act pe rformed by the defendant with a conscious desire to prevent the relationship fro m occurring or with knowledge that the interference was certain or s ubstantially likely to occur as a result of its conduct; (3) a lack of privilege or justification fo r the defendant’s actions; and (4) actual harm or damages suffered by the plaintiff as a re sult of the defendant’s interference, i.e., the defendant’s actions prevented the relationship from occurring. Id

. Appellees argue Smith’s affidavit prove s a prima facie case for these two causes of action. However, Smith stated th at Virtual and Viome “never entered into any contractual relationship, either written or verbal . . . .” Thus, appellees cannot make a case for tortious inte rference with an existing cont ract. Further, appellees’ tortious interference with a prospective c ontract claim suffers the same weakness as–34– their business disparagement and defama tion claims—whether appellees suffered damages as a result of any tor tious interference. Smith stated in his affidavit that he himself cut off further communications with Viome after Viome asked him to demonstrate he was free to work with th em under his separation agreement. Given this, we cannot conclude appellees have provided clear and specific evidence that appellants’ actions prevented a business relationship between Viome and Virtual from developing. The trial court erred by failing to dismiss these two claims. Declaratory judgment claims Step one . As described above, Kearl sought a declaration of his rights under his separation agreement with LaCore, that his agreement did not prevent him from working in the “DNA-based custom nutrition supplement industry, ” and that he was permitted to work for a company in that in dustry provided he wa s not disclosing or using LaCore’s confidential information. Smith sought similar declaratory relief against Link. He requested a declarati on that his separation agreement did not prevent him from working for one of Link’s competitors after a certain date, that it did not prevent him from working in the industry, and that he could work for a company in the industry provided he did not disclose or use Link’s confidential information. Finally, Virt ual sought a declaration agai nst Link and LaCore that certain items, including particular ideas, machines, and software, did not constitute trade secrets owned by Link or LaCore and “therefore, [such item s] may not be the basis for a trade secret misappropriation claim against [V irtual].”–35– We conclude Kearl’s and Smith’s decl aratory judgment actions are not based on or in response to appellants’ lawsuit or communications in the judicial proceeding. Their sought-after declarations are not factually predicated on any such communications. Nor are these actions base d on or in response to appellants’ right of free speech on matters of public c oncern, as appellants also argue. See Creative Oil & Gas, LLC , 591 S.W.3d at 137 (“[N]ot every communication related somehow to one of the broad categorie s set out in section 27.001(7) always regards a matter of public concern. A private contract di spute affecting only the fortunes of the private parties involved is simply not a ‘m atter of public con cern’ under any tenable understanding of those words.”); see also Erdner , 580 S.W.3d at 276. Instead, their requested declarations involve their lega l rights under their respective separation agreements and their right to work in th eir industry. We conclude the TCPA does not apply to these actions. See Choudhri v. Lee , No. 01-20-00098-CV, 2020 WL 4689204, at *3 (Tex. App.—Houston [1st Dist .] Aug. 13, 2020, pet. denied) (mem. op.). We similarly conclude a ppellants have failed to de monstrate that Virtual’s declaratory judgment action against LaCore and Link is based on or in response to appellants’ exercise of the right of free speech or the right to petition. As to the right of free speech, appellants fail to point to what communications of theirs the declaratory judgment claim was based on or in response to. Further, we do not think whether something is a trade secret owned by LaCore is a “matter of public concern”–36– within the meaning of the TCPA. See Creative Oil & Gas, LLC , 591 S.W.3d at 137. As to the right to petition, it is true that appellants brough t a claim against all appellees, including Virtual, for violations of the Texas Uniform Trade Secrets Act. However, we cannot agree that Virtual’s declaratory judgment action was factually predicated upon this claim simply because it sought a declaration regarding the same or similar issues raised by appe llants in their TUTSA claim. Cf. Riggs & Ray, P.C. v. State Fair of Tex. , No. 05-17-00973-CV, 2019 WL 4200009, at *5 (Tex. App.— Dallas Sept. 5, 2019, pet. denied) (mem . op.) (concluding Riggs & Ray’s lawsuit was not based on or in response to the Stat e Fair’s exercise of its right to petition even though Riggs & Ray filed a declaratory judgment action after the State Fair had non-suited a declaratory action involving the same information). Virtual’s declaratory relief claim is based upon the bus iness dispute betwee n the parties about whether certain items are appellants’ trad e secrets. Accordingly, we reject appellants’ contentions regarding the three declaratory judgment actions. Attorney’s fees Finally, appellants argue they are entitle d to attorney’s fees and sanctions because appellees’ counterclaims are frivolous or solely intended for delay. Under section 27.009(a), except as provided by sec tion 27.009(c), if the court dismisses a legal action under the TCPA, th e court “(1) shall award to the moving party court costs and reasonable attorney’s fees incurre d in defending against the legal action” and “(2) may award to the moving party sa nctions against the party who brought the–37– legal action as the court de termines sufficient to deter the party who brought the legal action from bringing similar acti ons described in this chapter.” T EX
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. C ODE § 27.009(a). Under section 27. 009(c), if the court “orders dismissal of a compulsory counterclaim unde r this chapter, the court may award to the moving party reasonable attorney’s fees incurred in defending against the counterclaim if the court finds that the c ounterclaim is frivolous or solely intended for delay.” Id . § 27.009(c). Because appellants’ motion to dismi ss was denied by operation of law, the trial court did not reach the question of cost s, fees, or sanctions. We remand for the trial court to, if it so decides in its disc retion, award appellants reasonable attorney’s fees if the trial court finds that appelle es’ compulsory counterclaims subject to dismissal were frivolous or so lely intended for delay. See id . § 27.009(c). 3 Further, we remand for the trial court to award appe llants court costs, and if the trial court determines them warranted in these circ umstances, sanctions against appellees as the court determines sufficient to deter appellees from bringing similar actions described in chapter 27. See id . § 27.009(a).
III. Conclusion We sustain appellants’ issue on a ppeal as to appellees’ business disparagement, defamation, abuse of pro cess, anti-trust violations, and tortious

3 Appellants contended in their TCPA motion to dismi ss that attorney’s fees ar e mandatory. We reject this contention and agree with appellees that, under section 27.009(c), the trial court has discretion in awarding fees following dismissal of compulsory counterclaims. See id

.–38– interference claims, and appellees’ br each of contract, TUTSA, and unfair competition claims to the extent they were based upon communi cations made in appellants’ petition. We reverse the denial of appellants’ motion to dismiss as to these claims. We remand to the trial cour t to dismiss these claims, and to address court costs, attorney’s fees, and sanctions in accordance with this opinion. We otherwise affirm the trial c ourt’s denial as a matter of law of appellants’ TCPA motion to dismiss.

210798F.P05 /Ken Molber g/ KEN MOLBERG JUSTICE–39– 

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Court of Appeals Fifth District of Texas at Dallas JUDGMENT
LACORE ENTERPRISES, LLC AND LINK BIOSCIENCES, LLC, Appellants
No. 05-21-00798-CV V. CLAIRE ANGLES, MICHEAL KEARL, MICHAE L SMITH, THE VIRTUAL FORM ULA, LLC, Appellees On Appeal from the 380th Judicial District Court, Collin County, Texas Trial Court Cause No. 380-01127- 2021. Opinion delivered by Justice Molberg. Justices Pedersen, III and Smith participating.

In accordance with this Court’s opinion of this date, the denial by operation of law of appellants’ motion to dismiss is AFFIRMED in part and REVERSED in part. We REVERSE that portion of the denial that denied appellants’ motion to dismiss as to appellees’ business disparagem ent, defamation, abus e of process, antitrust violations, and tortious interference claims, and appellees’ breach of contract, TUTSA, and unfair competition claims to the extent they were based upon communications made in appellants’ petition. We REMAND this cause to the trial court to dismiss these claims and for consid eration of court costs, attorney’s fees, and sanctions in accordance with this opinion. We otherwise AFFIRM the denial by operation of law of appellant s’ motion to dismiss. It is ORDERED that each party bear its own costs of this appeal.
Judgment entered March 23, 2023.