Court Opinion

ID: 4459378
Source: CourtListenerOpinion
Date Created: 2019-11-26 23:15:18.748778+00
Date Added: 2024-06-11T14:51:47.783178
License: Public Domain

Reversed and Remanded and Opinion filed November 26, 2019.

                                          In The

                       Fourteenth Court of Appeals

                                 NO. 14-18-01048-CV

      JOANIE STEINHAUS, INDIVIDUALLY, AND TURTLE ISLAND
                RESTORATION NETWORK, Appellant
                                             V.

               BEACHSIDE ENVIRONMENTAL, LLC, Appellee

                      On Appeal from the 56th District Court
                            Galveston County, Texas
                       Trial Court Cause No. 18-CV-0931

                                        OPINION

       In this appeal, we hold that a nonprofit corporation and one of its directors
are entitled to dismissal of a company’s claims governed by the Texas Citizens
Participation Act (TCPA)1 because the appellants proved a qualified privilege and
the company failed to establish a prima facie case to support its claims. Thus, we

       1
         See Tex. Civ. Prac. & Rem. Code ch. 27; see also In re Lipsky, 460 S.W.3d 579, 584 &
n.1 (Tex. 2015).
reverse the trial court’s order denying the appellants’ motion to dismiss and
remand for the trial court to award relief under the TCPA.

                                   I.      BACKGROUND

       Beachside Environmental, LLC sued Joanie Steinhaus and the Turtle Island
Restoration Network (TIRN) (collectively, appellants) for defamation per se,
tortious interference with contractual relations, and tortious interference with
prospective contractual relations. Appellants filed a motion to dismiss under the
TCPA, and the parties filed affidavits and other evidence.

       Beachside, a company partially owned and managed by Hernan Botero, had
been providing beach cleaning and grooming services since 2012 to residential
subdivisions and condominiums on the island. The Galveston Island Park Board of
Trustees2 also had been cleaning beaches using heavy equipment and vehicles. To
do so required a federal permit, but none had been obtained until the Park Board
ultimately obtained one in 2017. The Park Board spent about $100,000 to obtain
the permit. The United States Army Corps of Engineers issued the Park Board a
permit, which covered areas where Beachside also operated. The Park Board
initially authorized Beachside to work “under” the permit for beaches on the island
not directly cleaned by the Park Board, and in return Beachside or its customers
would pay fees.

       The permit prohibited the “take”3 of certain endangered species, allowed
some incidental take, and imposed conditions to prevent take. The parties agree
that Beachside was required to comply with the permit’s conditions for beach

       2
         The parties appear to disagree about the official or proper name for the Park Board. We
use the name identified in the permit, discussed below.
       3
        Under the Endangered Species Act, “take” means to “harass, harm, pursue, hunt, shoot,
wound, kill, trap, capture, or collect, or to attempt to engage in any such conduct.” 16 U.S.C.
§ 1532(19).

                                               2
cleaning, among other conditions. Beachside acknowledges that it was required to
(1) notify appellants prior to cleaning any beaches; (2) have a trained and certified
“spotter” or “monitor” present during cleaning; and (3) only remove seaweed
(sargassum) if the seaweed covered more than 10% of the area.

       The TIRN is a nonprofit corporation “dedicated to the preservation and
protection of marine wildlife.” Steinhaus is the Gulf program director for the
TIRN, and her duties include overseeing and directing projects on the upper Texas
coast related to ocean conservation and habitat and watershed protection. Her
duties include the protection of nesting and stranded turtles from mechanized
beach cleaning and raking activity.

       The permit requires the TIRN to conduct “sea turtle patrols” in Galveston as
part of a “two-part monitoring plan,” with the goal of detecting and protecting
species that may be impacted by beach maintenance equipment. The permit
provides, “The Park Board should coordinate with TIRN to ensure all proposed
beach areas that will be maintained during the sea turtle nesting season are
patrolled daily.” The permit requires monitors to work in collaboration with sea
turtle patrollers from the TIRN.4

       Steinhaus testified that the operations manager for the Park Board asked
Steinhaus to notify him if she observed any violations of beach maintenance
operations. Appellants adduced other evidence indicating that the United States
Army Corps of Engineers could revoke the Park Board’s permit if beach cleaning

       4
         The permit also explains that sargassum removal may only occur when the sargassum
“on the wrack line exceeds 10% of the beach template,” and sargassum removal may only occur
“between the Mean High Tide line and the landward 3 foot contour line.” The permit requires a
wrack line at the high tide mark to remain after beach grooming is completed. Appellants
contend, and Beachside does not dispute, that a “wrack line” is a “coastal feature where organic
material, such as seaweed, is deposited during high tide.” See Tex. R. App. P. 38.1(g) (court
accepts as true facts stated unless contradicted).

                                               3
was not performed in compliance with the permit, and the Park Board had been
concerned about losing its permit if vendors failed to abide by the permit’s terms
and conditions.

      In May 2018, Steinhaus made the following statements, among others, at a
meeting of the Park Board’s Beach Maintenance Advisory Committee:

      . . . I feel that, um, Hernan is out more frequently raking the beach and
      not leaving the wrack line that is required. So those are definite
      concerns of mine, and the placement of the material when it’s done. I
      personally have been on the beach, patrolling and not[—]he has not
      had a sea turtle monitor on the beach. And I have called him, and
      requested to know why there was not a monitor on the beach. So those
      are all concerns.
In its petition, Beachside alleged that the appellants’ defamatory statements were
that (1) Beachside was “out more frequently raking the beach and not leaving the
[w]rack line that is required”; (2) Beachside “has not had a sea turtle monitor on
the beach” when Steinhaus was patrolling; and (3) Steinhaus called Beachside and
“requested to know why there was not a monitor on the beach.”

      In their motion to dismiss under the TCPA, and more fully developed in
their reply, appellants argued among other grounds for dismissal that appellants
had proven a qualified privilege defense and that Beachside failed to make a prima
facie case for its claims. The trial court denied the motion, and appellants bring this
interlocutory appeal. See Tex. Civ. Prac. & Rem. Code § 51.014(a)(12).

                                  II.    ANALYSIS

      In ten issues, appellants contend that the trial court erroneously admitted
evidence and denied the motion to dismiss. We do not recite all the arguments
because the third and tenth issues are dispositive. See Tex. R. App. P. 47.1. In their
tenth issue, appellants contend that they proved an affirmative defense of qualified

                                          4
privilege to the defamation claim and that Beachside failed to show appellants’
actual malice. In their third issue, appellants contend that Beachside failed to show
a prima facie case for any element of its tortious interference claims.

A.     TCPA Motion to Dismiss and Standard of Review

       The TCPA protects citizens from retaliatory lawsuits that seek to intimidate
or silence them on matters of public concern. In re Lipsky, 460 S.W.3d 579, 586
(Tex. 2015). The TCPA provides a special procedure for expedited dismissal. Id.
First, movants such as appellants must show by a preponderance of the evidence
that the plaintiff’s claim is based on, relates to, or is in response to the movant’s
exercise of the right of free speech, the right to petition, or the right of association.
Id. (citing Tex. Civ. Prac. & Rem. Code § 27.005(b)).5 Beachside concedes that its
claims are governed by the TCPA because appellants’ statements were made in
connection with their exercise of the right to petition. See Tex. Civ. Prac. & Rem.
Code § 27.001(4).

       Because this initial burden has been met, the burden shifts to Beachside to
establish, by clear and specific evidence, a prima facie case for each essential
element of the claim in question. See ExxonMobil Pipeline Co. v. Coleman, 512
S.W.3d 895, 899 (Tex. 2017) (citing Tex. Civ. Prac. & Rem. Code § 27.005(c)).
Even if Beachside satisfies this burden, a court will dismiss the action if appellants
establish by a preponderance of the evidence each essential element of a valid
defense. See id. (citing Tex. Civ. Prac. & Rem. Code § 27.005(d)).

       We review the trial court’s denial of a motion to dismiss de novo. Cox
Media Grp., LLC v. Joselevitz, 524 S.W.3d 850, 859 (Tex. App.—Houston [14th

       5
         The TCPA was amended after Beachside filed suit. See Act of May 17, 2019, 86th Leg.,
R.S., ch. 378, § 11, 2019 Tex. Sess. Law Serv. 684, 687. We apply the version of the statute
before the 2019 amendment. See id.

                                             5
Dist.] 2017, no pet.). Under this standard, we make an independent determination
and apply the same standard used by the trial court in the first instance. Id.

A.    Defamation and Qualified Privilege

      The elements of defamation include (1) the publication of a false statement
of fact to a third party, (2) that was defamatory concerning the plaintiff, (3) made
with the requisite degree of fault, and (4) damages in some cases. In re Lipsky, 460
S.W.3d at 593. Generally, the status of the plaintiff determines the requisite degree
of fault. See id. A private individual need only prove negligence, whereas a public
figure or official must prove actual malice. Id. However, even a private individual
must prove actual malice if the circumstances support the application of a qualified
privilege. Robert B. James, DDS, Inc. v. Elkins, 553 S.W.3d 596, 610 (Tex. App.—
San Antonio 2018, pet. denied) (citing Espinosa v. Aaron’s Rents, Inc., 484
S.W.3d 533, 543 (Tex. App.—Houston [1st Dist.] 2016, no pet.)); see also
Thomas-Smith v. Mackin, 238 S.W.3d 503, 509, 511 (Tex. App.—Houston [14th
Dist.] 2007, no pet.) (noting that the burden would be on the private individual
plaintiff to prove malice if the defendant proves the affirmative defense of
qualified privilege); Gulf Const. Co. v. Mott, 442 S.W.2d 778, 784 (Tex. App.—
Houston [14th Dist.] 1969, no writ) (“The burden of proof is on the plaintiff to
prove that the defendants in the exercise of a conditional [or qualified] privilege
was prompted or partially prompted by malice or a want of good faith.”). “Actual
malice” means that the statement was made with knowledge of its falsity or with
reckless disregard for its truth. In re Lipsky, 460 S.W.3d at 593.

      A qualified privilege—sometimes called a “conditional” privilege—arises
out of the occasion upon which the false statement is published. Shell Oil Co. v.
Writt, 464 S.W.3d 650, 654 (Tex. 2015) (citing Hurlbut v. Gulf Atl. Life. Ins., 749
S.W.2d 762, 768 (Tex. 1987)). The occasions that may give rise to a conditional

                                           6
privilege are described in the Restatement. Id. (citing Hurlbut, 749 S.W.2d at 768
(citing Restatement (Second) of Torts §§ 594-598A (1977))). Circumstances that
may give rise to a qualified privilege include those that induce: “(1) a belief that
publication protects the publisher’s interest; (2) a belief that publication protects
the interest of certain recipients or third persons; (3) a belief that a person sharing a
common interest in the published information is entitled to know that information;
(4) a belief that the publication protects a family member of the publisher or of
certain recipients or third persons; and (5) a belief that an important public interest
requires publication.” Granada Biosciences, Inc. v. Forbes, Inc., 49 S.W.3d 610,
619 (Tex. App.—Houston [14th Dist.] 2001), rev’d on other grounds, Forbes, Inc.
v. Grranada Biosciences, Inc., 124 S.W.3d 167 (Tex. 2003); see also Cain v.
Hearst Corp., 878 S.W.2d 577, 582 (Tex. 1994) (“Qualified privileges against
defamation exist at common law when a communication is made in good faith and
the author, the recipient or a third person, or one of their family members, has an
interest that is sufficiently affected by the communication.”). This court has
described a qualified or conditional privilege as “bona fide communications, oral
or written, upon any subject in which the author or the public has an interest or
with respect to which he has a duty to perform to another owing a corresponding
duty.” Mott, 442 S.W.2d at 784.

      A qualified privilege is lost if abused. See Writt, 464 S.W.3d at 655; Knox v.
Taylor, 992 S.W.2d 40, 55–56 (Tex. App.—Houston [14th Dist.] 1999, no pet.);
see also Restatement (Second) of Torts § 599. Abuse occurs if the statements are
made with actual malice. See Writt, 464 S.W.3d at 655; Randall’s Food Mkts., Inc.
v. Johnson, 891 S.W.2d 640, 646 (Tex. 1995) (“Proof that a statement was
motivated by actual malice existing at the time of publication defeats the

                                           7
privilege.”).6 And abuse may occur if the statements are communicated to persons
who do not have an interest or duty in the matter to which the communications
relate. See Randall’s, 891 S.W.2d at 646 (privilege “remains intact” as long as
there is no excessive communication); see also Thomas-Smith, 238 S.W.3d at 509–
10 (noting that the casual or accidental presence of third party will not result in loss
of privilege). See generally Restatement (Second) of Torts § 604 & cmt. a (abuse
of privilege occurs if speaker knowingly publishes the matter to a person whom
publication is not otherwise privileged unless the speaker reasonably believes that
the publication is a proper means of communicating the defamatory matter).

       Once a defendant establishes that a communication is conditionally or
qualifiedly privileged, the plaintiff must then show that the privilege is lost. See
Knox, 992 S.W.2d at 55–56 (citing Denton Publ’g Co. v. Boyd, 460 S.W.2d 881,
884 (Tex. 1970)); see also KBMT Operating Co. v. Toledo, 492 S.W.3d 710, 714–
15 (Tex. 2016) (reaffirming the defendant’s burden to establish the applicability of
a privilege and the plaintiff’s burden to establish falsity). See generally
Restatement (Second) of Torts § 613 (burden on defendant to prove the privileged
character of the occasion; burden on the plaintiff to prove abuse of a conditionally
privileged occasion).

       Appellants contend that their communication to the Park Board about
Beachside’s activities are privileged because appellants and the Park Board each
had an interest sufficiently affected by the communication and that appellants had
a duty to report violations of the permit to the Park Board. Beachside does not

       6
         We apply the “actual malice” standard rather than mere common law malice. See Duffy
v. Leading Edge Prods., Inc., 44 F.3d 308, 313 (5th Cir. 1995); Hagler v. Proctor & Gamble
Mfg. Co., 884 S.W.2d 771, 771–72 (Tex. 1994) (per curiam); Dun & Bradstreet, Inc. v. O’Neil,
456 S.W.2d 896, 900–01 (Tex. 1970). But see Houston v. Grocers Supply Co., 625 S.W.2d 798,
801 (Tex. App.—Houston [14th Dist.] 1981, no writ) (applying common law malice to qualified
privilege).

                                             8
contest that appellants had an interest or duty sufficiently affected by the
communication. Indeed, the evidence shows that appellants and the Park Board
each had interests related to the communication. Appellants had an interest in
protecting endangered species, and the Park Board had an interest in seeing
compliance with the permit. The Park Board and the TIRN had a duty to work
together under the permit, and Steinhaus testified that the Park Board asked her to
report suspected violations of the permit. The evidence for privilege is even greater
than in McDowell v. State, 465 F.2d 1342 (5th Cir. 1971), in which the court of
appeals upheld the application of a qualified privilege. See id. at 1344–45. The
defendant was the executive director of a charitable group whose purpose was to
foster the treatment, care, and rehabilitation of mentally disabled children. Id. at
1345. The defendant made the defamatory statement to members of the State’s
governing board, whose official duties were to act in furtherance of the purpose of
the charitable group. Id. The statement concerned an allegation that an employee of
the board had “imputed a canine status to the mothers” of several board members.
Id. 1344. The court held that the defendant and the recipients of the communication
shared a common interest in the care of mentally disabled children and the
harmony and competency of the staff employed by the State who worked with the
children. See id. at 1344–45.

      Beachside contends that appellants abused the privilege because (1)
appellants acted with malice or improper purpose, and (2) the statements were
communicated to people not having an interest or duty in the matter to which the
communications related. Beachside has the burden to establish either of these
abuses. See Knox, 992 S.W.2d at 55–56; Restatement (Second) of Torts § 613.

      Regarding malice, Beachside contends that Steinhaus “may have even
known that her statements were false at the time of publication because she had

                                         9
observed a competitor of Appellee operating out of Permit compliance, not
Appellee.”7 Beachside adduced some evidence that Steinhaus’s statements were
false, but the falsity of the statement itself cannot prove actual malice. See Turner
v. KTRK Television, Inc., 38 S.W.3d 103, 125 (Tex. 2000) (citing Harte-Hanks
Commc’ns, Inc. v. Connaughton, 491 U.S. 657, 681 (1989)); see also Cheatwood
v. Jackson, 460 S.W.2d 528, 530 (Tex. App.—Houston [14th Dist.] 1970, writ
ref’d n.r.e.) (regarding proof of actual malice to defeat a conditionally privileged
statement, “proof of malice on the part of the defendant cannot be inferred from the
falsity of the statement alone”). The record does not contain evidence that
Steinhaus knew she had not observed Beachside before she made the defamatory
statements; thus, there is no evidence that Steinhaus knew her statements to be
false.

         Nor is there any evidence that Steinhaus made the statements with reckless
disregard for their truth. There is no evidence that Steinhaus made an “inherently
improbable” assertion or made the statement “based on information that is
obviously dubious.” See Bentley v. Bunton, 94 S.W.3d 561, 596 (Tex. 2002).
Beachside contends that appellants have the motive to stop all beach cleaning
practices, but “an injurious motive alone is insufficient to establish a prima facie
case of actual malice.” Rodriguez v. Gonzales, 566 S.W.3d 844, 855 (Tex. App.—
Houston [14th Dist.] 2018, pet. denied).8 And, Botero’s self-serving denial of
improper activity does not show that Steinhaus spoke with knowledge of the falsity

         7
         Steinhaus described in her affidavit, and attached pictures, to identify instances that she
claimed were of Beachside’s cleaning without monitors and the proper wrack line. The trial court
sustained Beachside’s objections to some of this evidence, and Beachside adduced evidence that
Steinhaus’s pictures in fact were of a different company’s activities.
         8
         Even if appellants’ motive were relevant under a common law malice standard, see
supra note 6, Beachside has not identified any evidence of appellants’ ill will or a bad or evil
motive directed at Beachside. Beachside does not cite to the record to support its contention that
appellants “want to stop any such beach cleaning practices at all costs.”

                                                10
of the statements or reckless disregard for the truth. Cf. Huckabee v. Time Warner
Entm’t Co., 19 S.W.3d 413, 427 (Tex. 2000) (“The mere fact that a defamation
defendant knows that the public figure has denied harmful allegations or offered an
alternative explanation of events is not evidence that the defendant doubted the
allegations.”). Beachside has not adduced prima facie evidence of actual malice.

      Regarding excessive communication, Beachside contends that appellants
made the statements at a public meeting where the audience was not confined to
only those having an interest or duty in the matter. Beachside points to no evidence
in the record to support its contention that persons other than the Park Board
members or Botero heard the statements. Thus, Beachside has not adduced prima
facie evidence of excessive communication. See Mendez v. Kavanaugh, No. 13-11-
00622-CV, 2012 WL 3594283, at *5 (Tex. App.—Corpus Christi Aug. 21, 2012,
no pet.) (mem. op.) (affirming summary judgment for defendant based on qualified
privilege despite evidence that the defamatory statements were posted on a
communal board and open for the public to see); see also Merlo v. United Way of
Am., 43 F.3d 96, 98–99, 104–05 (4th Cir. 1994) (no abuse of the privilege by
excessive publication when a non-profit corporation published report to national
news media concerning financial improprieties of former executives because the
non-profit’s millions of donors had a legitimate interest in the subject matter).

      Because appellants established by a preponderance of the evidence that the
qualified privilege applied, and Beachside has not shown abuse of the privilege,
the trial court erred by denying the motion to dismiss Beachside’s defamation
claim. Appellants’ tenth issue is sustained.

B.    Tortious Interference Claims

      In its petition, Beachside asserted claims for tortious interference with
contractual relations and prospective relations. Beachside alleged that harm
                                          11
resulted from appellant’s “statements” and “falsehoods.” Appellants argued in the
motion to dismiss that Beachside’s claims were covered by the TCPA, and
Beachside concedes on appeal that “Appellants’ statements were made in
connection with their exercise of their right to petition.” It is clear from
Beachside’s pleadings that the tortious interference claims are based on the same
facts alleged to support the defamation claim and that all the claims are covered by
the TCPA. See Hersh v. Tatum, 526 S.W.3d 462, 467 (Tex. 2017) (“When it is
clear from the plaintiff’s pleadings that the action is covered by the Act, the
defendant need show no more.”).

      Beachside has not pointed to any evidence, either in the trial court or on
appeal, to support a prima facie case for any element of its tortious interference
claims. Thus, the trial court erred by denying the motion to dismiss these claims.
See Tex. Civ. Prac. & Rem. Code § 27.005(b)(1)(B), (c). Appellants’ third issue is
sustained.

                                III.   CONCLUSION

      Appellants established that the TCPA applies to Beachside’s claims and that
appellants’ statements were conditionally privileged. Beachside failed to show
abuse of the privilege, or any element of its tortious interference claims. Thus, the
trial court erred by denying the motion to dismiss Beachside’s claims.

      We reverse the trial court’s order and remand for the trial court to award
appellants relief under Section 27.009 and dismiss the action. See Joselevitz, 524
S.W.3d at 865.

                                       /s/    Ken Wise
                                              Justice

Panel consists of Justices Christopher, Wise, and Hassan.

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