AFFIRM; and Opinion Filed June 28, 2019 

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In The 

## Court of Appeals Fifth District of Texas at Dallas
No. 05-18-00971-CV JONATHAN PERLMAN AND TRADITION SENIOR LIVING, L.P., Appellants V. EKLS FIRESTOPPING & CONST RUCTION, LLC, Appellee On Appeal from the 101st Judicial District Court Dallas County, Texas Trial Court Cause No. DC-16-04381 

### MEMORANDUM OPINION Before Justices Bridges, S chenck, and Pedersen, III Opinion by Justice Bridges Appellee EKLS Firestopping & Cons truction, LLC (EKLS) sued Four Suns Construction, L.L.C. (Four Suns) and appellants Jonathan Perlman and Traditio n Senior Living, L.P. (TSL) alleging breach of contract and seeking to pierce the corporate veil of Four Suns to impose liability on Perlman and TSL. Appellants filed a motion to dismiss EKLS’ s claims pursuant to the Texas Citizens Participation Act, T EX
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. C ODE A NN . §§ 27.001–.011 (the TCPA), and now appeal the denial of that motion by operation of law. 1 In three issues, appellants assert the trial court erred by (1) sustaining EKLS’s objections to eviden ce offered in support of the motion to dismiss, (2) denying the mo tion to dismiss, and (3) denying appellants’ request for an award of

1 See C IV
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. & R EM . § 51.014(a)(12) (authorizing a person to appeal from an inter locutory order denying a motion to dismiss under section 27.003); see also id . § 27.008(a) (providing for denial of TCPA motion by operation of law if motion is not ruled on within TCPA deadlines and upon which “the moving party may appeal.”).–2– attorney’s fees and/or sanctions . We conclude appellants faile d to carry their burden of establishing the TCPA applies to EKLS’s claims. Accordingly, w e affirm the denial of appellants’ motion to dismiss.
B ACKGROUND EKLS contracted with Four Suns to provide firestopping installa tion services for fire-rated walls and floors at an assisted living community. Perlman, the sole manager and president of Four Suns and president of TSL, 2 negotiated and signed the contract. 3 Under the contract, EKLS was to provide services, its invoices would be paid within thirty d ays of receipt, it could charge a ten percent late fee if invoices were not paid timely, and the tota l amount invoiced would not exceed $125,000. EKLS performed the work, but was consistently paid l ate. When payments stopped, EKLS did not return t o the project. Four Suns filed suit against EKLS, alleging EKLS breached the c ontract by failing to finish its scope of work. EKLS counterclaimed against Four Suns seeki ng fees owed under the contract. EKLS later amended its counterclaim to add Perlman and TSL as c ounter-defendants on its claim for fees. In its second amended counterclaim, EKLS asserts a b reach of contract cause of action against Four Suns, TSL, and Perlman for failing to pay EKLS for the work and services it performed. EKLS also asserts Four Suns was operated as a mere tool, or business conduit, of Perlman and TSL to evade legal obligations and, as a result, th e corporate fiction should be disregarded and Perlman, indivi dually, and TSL should be liable for EKLS’s damages. As support, EKLS alleges it regularly interacted with TSL and Perlman and ( 1) EKLS was instructed to send the invoices to a TSL employee, and Perlman approved the invoic es for final payment; (2) Four Suns, Perlman, and TSL shared common offices and employees and centralized accounting; (3)

2 TSL, a limited partnership, is the sole member of Four Suns. The sole general partner of TSL is Tradition SL, LLC, and Perl man is the manager of Tradition SL, LLC. 3 The record shows Perlman signed an EKLS proposal dated May 20 , 2015, and a subsequent updated proposal dated June 11, 2015.–3– TSL paid bills for Four Suns, and TSL’s employees rendered serv ices on behalf of Four Suns; (4) the allocation of profits and losses between the entities is un clear; (5) Perlman and TSL jointly undertook and shared the management, control, and daily operati ons of Four Suns; and (6) Perlman never intended for Four Suns to have any employees. Ac cording to EKLS, Four Suns “was used fraudulently to act as the contracting party with EKL S so that later Perlman and [TSL] could refuse to pay EKLS for wo rk perform (sic) but not have an y liability.” Appellants filed a motion to dismiss EKLS’s claims under the TC PA. The motion to dismiss asserts all of EKLS’s claims are based on appellants’ e xercise of the right of association and the alter ego claims, which require proof of “fraudulent re presentations,” also are based on their exercise of the right to free speech. The trial court he ld a hearing on appellants’ motion to dismiss but failed to rule on the motion within t hirty days of the hearing, causing the motion to be denied by operation of law. See C IV
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. & R EM . § 27.005(a), .008(a). A PPLICABLE L AW The legislature enacted the TCPA to “encourage and safeguard th e constitutional rights of persons to petition, speak freely, associate freely, and otherw ise 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.” See C IV
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. & R EM
. § 27.002; ExxonMobil Pipeline Co. v. Coleman , 512 S.W.3d 895, 898 (Tex. 2017). The TCPA sets out a two-ste p procedure to expedite the dismissal of claims brought to intimi date or silence a defendant’s exercise of the applicable First Amendment rights. C IV
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. & R EM . §§ 27.003(a), .005; Coleman , 512 S.W.3d at 898. A movant seeking dismissal under the TCPA bears an initial burd en of showing by a preponderance of the evidence that the legal action is based on , relates to, or in response to the movant’s exercise of the right of free speech, the right of ass ociation, or the right to petition. C IV
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. & R EM . § 27.005(b); see also S & S Emergency Training Solutions, Inc. v. Elliott , 564 S.W.3d 843, 847 (Tex. 2018). If th e movant makes this showing, the burden shifts to the nonmovant to establish by clear and specific evidence a prima faci e case for each essential element of its claims. C IV
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. & R EM . § 27.005(c); Elliott , 564 S.W.3d at 847. If the non-movant satisfies this requirement, the trial court must still dismiss a claim if the movant “establishes by a preponderance of the evidence each essential element of a valid defense to the [non-movant’s] claim.” C IV
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. & R EM . § 27.005(d); see Youngkin v. Hines , 546 S.W.3d 675, 679–80 (Tex. 2018). To determine whether a legal action should be dismissed , the trial court considers “the pleadings and supporting and opposing affidavits stating the fa cts on which liability or defense is based.” C IV
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. & R EM . § 27.006(a); Hersch v. Tatum , 526 S.W.3d 462, 467 (Tex. 2017). We review de novo the trial court’s ruling on a TCPA motion to dismiss. Mohamed v. Ctr. for Sec. Policy , 554 S.W.3d 767, 773 (Tex. App.—Dallas 2018, pet. denied). In doing so, we consider the pleadings and s upporting and opposing affidavits i n the light most favorable to the
non-movant. Fishman v. C.O.D. Capital Corp. , No. 05-16-00581-CV, 2017 WL 3033314, at *5 (Tex. App.—Dallas July 18, 2017, no pet.) (mem. op.). Whether the TCPA applies to a non- movant’s claims is an issue o f statutory interpretation that we also review de novo. Youngkin , 546 S.W.3d at 680. In conducting our analysis, we construe the TCPA “liberally to effectuate its purpose and inte nt fully.” C IV
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. & R EM . § 27.011(b); see also State ex rel. Best v. Harper , 562 S.W.3d 1, 11 (Tex. 2018). “We ascertain and give effect to the Legislature’s intent as expressed in the lan guage of the statute,” see Harper , 562 S.W.3d at 11, and construe the statute’s words “according to th eir plain and common meaning, unless a contrary intention is apparent from the context, or un less such a construction leads to absurd results.” Youngkin , 546 S.W.3d at 680. The supreme court has specifically direct ed us to adhere to the definitions in the TCPA. Adams v. Starside Custom Builders , LLC , 547 S.W.3d 890,–5– 894 (Tex. 2018); Youngkin , 546 S.W.3d at 680. However, in the process of applying “isol ated” definitions, we are required to construe those individual words and provisions in the context of the statute as a whole. Youngkin , 546 S.W.3d at 680–81. A

NALYSIS In their second issue, appellants contend the trial court erred in denying by operation of law their TCPA motion to dismiss because they satisfied their i nitial burden of showing EKLS’s claims are based on, relate to, or in response to appellants’ e xercise of their rights of association and free speech. The TCPA’s de finitions of both exercise of th e right of association and exercise of the right of free speech requi re a communication, which incl udes “the making or submitting of a statement or document in any form or medium, including oral, visual, written, audiovisual, or electronic.” See C IV
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. & R EM . §§ 27.001(1)–(3). 4 Appellants’ motion to dismiss and brief on appeal identify the following general categories of communic ations: “(a) the execution of multiple contracts and change orders; (b) documents establishin g relationships between Four Suns, TSL, and Perlman; and (c) communications between the parties pr ior to and in connection with the contracting upon which EKLS bases its allegations that Perl man and TSL are each liable as parties to the agreement.” 5 Exercise of Right of Association On appeal, appellants assert EKLS’s breach of contract and pier cing the corporate veil claims 6 against them are based upon their exercise of the right of ass ociation and, specifically,

4 Following this case’s submission, the Texas Legislature amen ded the TCPA in several respect s, including removing the “commu nication” requirement from the definition of an “exercise of the right of association.” See Act of June 2, 2019, 86 th Leg., R.S., ch. 378, § 1-12, 2019 Gen. Laws ___. The amendments, however, apply only to actions filed on or after September 1, 2019. Id . at § 11. 5 Our review of EKLS’s second am ended counterclaim shows it ref ers to the following communications: (1) EKLS being hired to pr ovide firestopping installation; (2) P erlman negotiating and signing the contract; (3) Perlman and EKLS agreeing to the contact’s te rms; (4) EKLS being instructed to send invoices to Lisa Gros, a TSL employee, and R obert Russell, a Tradition Management, LLC employee; (5) EKLS’s weekly invoicing; (6) Perlman approving invoices for payment; and (7) EKLS regularly having to follow up with Gros, Russell, and Perl man for payment. EKLS’s brief also refers to evid ence that Perlman required EKLS to list Four Suns as the contracting party. 6 Appellants refer to, and address, EKLS’s request to pierce the corporate veil as a separate claim, apart from EKLS’s breach of contract claim. An attempt to pierce the corporate veil, in and of itse lf, is not a cause of action, but rather a means of imposing li ability in an underlying–6– communications, including Perlman’ s execution of the EKLS contr act “along with whatever additional documents or communications establish Perlman’s rela tionship with TSL” and “the ‘communications’ which establis h [the] associa tion” between Per lman, TSL, and Four Suns. The TCPA defines the “exercise of the right of association” as “a communication between individuals who join together to collectively express, promote, pursue, or defend common interests.” C IV
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. & R EM . § 27.001(2); see also Kawcak v. Antero Res. Corp. , No. 02-18- 00301-CV, 2019 WL 761480, at *6 (Tex. App.—Fort Worth Feb. 21, 2019, pet. denied). This Court has concluded that “to cons titute an exercise of the righ t of association under the [TCPA], the nature of the ‘communication between individuals who join t ogether’ must involve public or citizen’s participation.” Dyer v. Medoc Health Servs., LLC , 573 S.W.3d 418, 426 (Tex. App.— Dallas 2019, pet. denied) (quoting ExxonMobil Pipeline Co. v. Coleman , 464 S.W.3d 841, 847 (Tex. App.—Dallas 2015), rev’d on other grounds , 512 S.W.3d 895). Neither appellants’ motion to d ismiss nor their brief in suppor t identified a common interest they joined together to collectiv ely express, promote, pursue, or defend. During the hearing on their motion to dismiss, appellants identified “build[ing] this assisted living facility” as a common interest between themselves and Four Suns. On appeal, they ide ntified a common interest in “contracting with EKLS.” To establish an exercise of the right of association, however, appellants also had to show the nature of the communication involved publi c or citizen participation. See Dyer , 573 S.W.3d at 426. Appellants did not show how Perlman’s exe cution of a private contract with EKLS involved any public or citizen participation. Simila rly, to the extent EKLS’s claims are based on, relate to, or in response to any communications t hat “establish” the “relationship” or “association” between Perlman, TSL, and/or Four Suns, appellant s have not shown those

cause of action. Matthews Constr. Co. v. Rosen , 796 S.W.2d 692, 693 n.1 (Tex. 1990). In any event, we addres s whether EKLS’s claims against appellants as alleged in its petition are based on, relate to, or in response to appellants’ exercise of both the right of ass ociation and the right of free speech.–7– communications, without more, i nvolve public or citizen partici pation. See Coleman , 464 S.W.3d at 847 (in light of TCPA’s purpose, “it would be illogica l for the [TC PA] to apply to situations in which there is no element of public participation”). Construing the TCPA to find a right of association in this case simply because there are communications between parties with a shared interest in a priv ate business transaction does not further the TCPA’s purpose to curb strategic lawsuits against p ublic participation. See, e.g., Dyer , 573 S.W.3d at 426–27 (concluding text messages between individ uals pursuing common interest of misappropriating appellees’ pr oprietary software and confide ntial business information did not involve public or citiz en’s participation); Kawcak , 2019 WL 761480, at *17 (“[T]he plain meaning of the word ‘common’ in TCPA s ection 27.001(2)’s definition of ‘the right of association’ requires more than two tortfeasors conspi ring to act tortiously for thei r own selfish benefit.”); see also In re IntelliCentrics, Inc. , No. 02-18-00280-CV, 2018 WL 5289379, at * 4 (Tex. App.—Fort W orth Oct. 25, 2018, orig. proceeding) (recognizing “distinction bet ween communications used as evidence to support a claim for breach of contract and a claim ‘based upon, relate[d] to, or [] in response to’ that communication under the TCPA”). Because appe llants have not shown the nature of any communication they rely upon involved public or citizen participation, we conclude they failed to establish by a preponderance of the evidence that EKL S’s claims are based on, relate to, or in response to appellants’ exe rcise of a right of associatio n as defined by the TCPA. Right of Free Speech Appellant also assert EKLS’s alter ego claims are based upon a ppellants’ exercise of the right to free speech. Appellants contend EKLS’s allegation tha t Four Suns “was used fraudulently to act as the contracting party with EKLS” necessarily implies a communication in the form of a misrepresentation.–8– The “exercise of the right of free speech” is a communication m ade in connection with a matter of public concern. C IV
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. & R EM . § 27.001(3). A “matter of public concern” may include an issue related to health or safety, environmental, ec onomic, or community well-being, the government, a public official or public figure, or a good, product, or service in the marketplace. Id . § 27.001(7). Private communica tions made in connection with a matter of public concern fall within the TCPA’s definition of the exercise of the right of fr ee speech. Lippincott v. Whisenhunt , 462 S.W.3d 507, 509 (Tex. 2015) (per curiam). The TCPA does no t require that communications specifically “mention” a matter of public concern or have more than a “tangential relationship” to such a matter, but applies so long as the movant’s statements a re “in connection with” “issue[s] related to” any of the matters of public concern listed in the statute. Coleman , 512 S.W.3d at 900. The TCPA, however, “has its lim its” and not every communication falls under the statute. See Dyer , 573 S.W.3d at 428 (citing In re IntelliCentrics, Inc. , 2018 WL 5289379, at *4). Appellants argue they met their burden of establishing the TCPA applies to EKLS’s alter ego claims because the claims are “expressly based on alleged m isrepresentations by Perlman and/or TSL in that EKLS a lleges Four Suns ‘was used fraudulently to act as the contracting party with EKLS so that later Perlman and [TSL] could refuse to pay E KLS for work perform [sic] but not have any liability.’” (Emphasi s in original). For the firs t time in their reply brief on appeal, appellants assert these communications were made in connection with a matter of public concern – health and safety – because assisted living facilities must b e licensed under the Texas Health and Safety Code, construction of assi sted living facilities is high ly regulated under the Texas Administrative Code in Texas, a nd firestopping is required to c omply with “very specific and somewhat onerous fire safety standards promulgated” by the Texa s Department of Aging and Disability Services.–9– To establish they were exercising their right of free speech, a ppellants had to show any “misrepresentations” 7 alleged by EKLS were made in c onnection with a m atter of publi c concern. See Coleman , 512 S.W.3d at 900. However, “[c]onstruing the [TCPA] to deno te that all private business discussions are a ‘matter of public concern’ if the bu siness . . . is related to health or safety is a potentially absurd result th at was not contemplated by the Legislature.” Erdner v. Highland Park Emergency Ctr., LLC , No. 05-18-00654-CV, 2019 WL 2211091, at *5 (Tex. App.—Dallas May 22, 2019, no pet. h.) (communications about formation of fr eestanding emergency room business and possible scope of its future activities were not e xercise of free speech simply because communications could result in healthcare services being offere d to the public at some point in the future); Staff Care, Inc. v. Eskridge Enters., LLC , No. 05-18-00732-CV, 2019 WL 2121116, at *5 (Tex. App.—Dallas May 15, 2019, no pet. h.) (mem. op.) (stateme nts about a business dispute, the subject of which involved physicians as part of an agreement fo r locum tenens coverage, were not in connection to an issue related to health and safety or commu nity well-being such that they were “matter of public concern”); Dyer , 573 S.W.3d at 428 (communications discussing misappropriating proprietary soft ware and other confidential in formation were not tangentially related to a matter of public concern simply because the inform ation belonged to a healthcare company). Here, appellants never argued in the trial court that EKLS’s le gal action was based on communications related to health and safety. Nor have they sho wn EKLS’s piercing the corporate veil theory is based on, relates to, or in response to any comm unication made in connection with an issue related to health and safety. Although the contract c alled for EKLS to perform

7 Appellants contend they cannot be liable unless EKLS establis hes appellants perpetrated an act ual fraud, which requires a co mmunication in the form of a misrepresentation. In support, appellants cit e authority setting out the elements of a fraud cause of action . However, in the context of piercing the corporate veil, actual fraud is not equivalent to the tort of fraud and instead involves “dishonesty of purpos e or intent to deceive.” See T EX
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. C ODE A NN . § 21.223(b); Martin v. U.S. Merchants Fin. Group, Inc. , No. 05-13-00999-CV, 2014 WL 6871392, at *5 (Tex. App.—Dallas Dec. 8, 2014, no pet.) (mem. op.); Latham v. Burgher , 320 S.W.3d 602, 607 (Tex. App.—Dallas 2010, no pet.).–10– firestopping services at an assisted living facility, the only issues in this case are whether EKLS performed the services and, if so, who is liable for paying for those services. Under these circumstances, we cannot conclude appellants satisfied their bu rden of showing by a preponderance of the evidence that EKLS’s claims are based on, relate to, or in response to appellants’ exercise of the right of free speech. See, e.g., Erdner , 2019 WL 2211091, at *5; Staff Care, Inc. , 2019 WL 2121116, at *5; Dyer , 573 S.W.3d at 428, at *6; compare Newspaper Holdings, Inc. v. Crazy Hotel Assisted Living, Ltd. , 416 S.W.3d 71, 81 (Tex. App.—Houston [1st Dist.] 2013, pet. denied) (op. on re h’g) (newspaper articles ab out an assisted living facility, especially whether it was meeting legal requirements and whethe r it was denying residents their legal rights, were in connection with matter of public concern) . Accordingly, we need not address whether EKLS established the elements of its prima facie case a gainst appellants by “clear and specific evidence” or appellants’ third issue asserting the tri al court erred in de nying their request for an award of attorney’s fees and/or sanctions. 8 See Tervita, LLC v. Sutterfield , 482 S.W.3d 280, 287 (Tex. App.—Dallas 2015, pet. denied) (because appellant fai led to meet its burden of showing TCPA applied to appellees’ claim, appellate court need not addr ess other prongs of TCPA analysis). We overrule a ppellants’ second issue. EKLS includes in its brief a request that we remand with an ord er that the trial court award it court costs and reasonable attorney’s fees under section 27. 009(b) because appellants’ motion to dismiss was frivolous. See C IV
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. & R EM . § 27.009(b) (authorizing trial court to award court costs and reasonable atto rney’s fees to a responding part y if it finds a TCPA motion to dismiss is frivolous or solely intended to delay). EKLS, howev er, did not file a notice of appeal, which is required to alter a trial court’s judgment or other ap pealable order. See T EX
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8 Similarly, we need not address appellants’ first issue in whi ch they complain the trial cour t erred in excluding supplementa ry evidence appellants filed to address newl y-asserted factual allegations in EKLS’s second amended counter claim. Appellants neither cite d to nor relied on the excluded evidence in arguing the TCPA applies to EKLS’s cla ims.–11– 25.1(c). Under rule 25.1(c), we may not grant a party who does not file a notice of appeal “more favorable relief than did the trial court except for just cause ,” see id ., and EKLS has made no just cause argument. Accordingly, EKLS has waived our consideration of this issue on appeal. See T EX
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. P. 38.1(h); Lacroix v. Simpson , 148 S.W.3d 731, 735–36 (T ex. App.—Dallas 2004, no pet.); New York Party Shuttle, LLC v. Bilello , 414 S.W.3d 206, 218–19 (Tex. App.—Houston [1st Dist.] 2013, pet. denied). We affirm the trial court’s de nial of appellants’ motion to dis miss by operation of law.

/David L. Bridges/ DAVID L. BRIDGES JUSTICE

180971F.P05–12– 

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Court of Appeals Fifth District of Texas at Dallas JUDGMENT

JONATHAN PERLMAN AND TRADITION SENIOR LIVING, L.P., Appellants No. 05-18-00971-CV V. EKLS FIRESTOPPING & CONSTRUCTION, LLC, Appellee On Appeal from the 101st Judicial District Court, Dallas County, Texas Trial Court Cause No. DC-16-04381. Opinion delivered by Justice Bridges; Justices Schenck and Pedersen, III participating.

In accordance with this Court’s opinion of this date, the judg ment of the trial court is AFFIRMED

. It is ORDERED that appellee EKLS FIRESTOPPING & CONSTRUCTION, LLC recover its costs of this appeal from appellants JONATHAN PERLM AN AND TRADITION SENIOR LIVING, L.P.
Judgment entered June 28, 2019.