Opinion
No. 05-98-02017-CV.
Opinion issued January 23, 2003.
Appeal from the 14th Judicial District Court, Dallas County, Texas, Trial Court Cause No. 96-00941-G.
AFFIRMED.
MEMORANDUM OPINION
The Money Masters, Inc. (Money Masters), The Masters of Money and Credit Corp. (Masters of Money), The Masters System, Inc. (Masters System), and Bruce Danielson (Danielson) (collectively appellants) appeal summary judgments in favor of TRW, Inc. (TRW), Trans Union Corp. (Trans Union), CSC Credit Services, Inc. (CSC), Experian Corp. (Experian), TRW/Experian employees Diane Fleming (Fleming) and Kelly Currie (Currie) (collectively credit reporting agencies), and Texaco, Inc. (Texaco). In a conditional cross-appeal, the credit reporting agencies challenge the trial court's denial of additional grounds for summary judgment. We affirm the trial court's judgment.
Background
Money Masters, Masters of Money, and Masters System (collectively corporate appellants) are "for-profit" consumer credit counseling and restoration companies founded by Danielson at different times during the 1990s. Their client population consists of individuals attempting to "clean" their credit record by having creditors remove negative account information that was (a) incorrect altogether; (b) had been at one point correct but had been either "charged off" or paid; or (c) was correct but could be paid in full or some lesser negotiated amount. If the clients did not already have their credit reports, appellants would request them from Trans Union, CSC, TRW and Experian, after obtaining their clients' powers of attorney. According to Danielson, in order to assist the clients properly, it was necessary to have both the consumer version of the credit report, as well as the commercial version, which contained additional consumer and credit rating information. Appellants would review the reports and consult with their clients to determine what information needed correction, or what outstanding balances could be paid. Once that determination was made, appellants would contact the credit reporting agencies and/or creditors, including Texaco, inquiring about those "errors" and offering to pay outstanding balances in exchange for the removal from the report of the negative information.
According to the deposition testimony of Danielson, Masters of Money is actually a mortgage business which provided credit restoration services only "for a short time."
This could include a judgment that had been vacated, lien that had been released, or bankruptcy that had been dismissed.
Experian purchased TRW's credit reporting agency in 1996. Appellants do not differentiate between the two in their allegations against them. Accordingly, neither do we and any reference to either shall be deemed a reference towards both.
Over a period of time, Danielson noticed the credit reporting agencies and Texaco were not responding to appellants' requests for credit reports or dispute resolution and his businesses were failing. At Experian, the requests were handled by either Fleming or Currie. According to the credit reporting agencies, they did not respond directly to appellants' requests for credit reports because they could not verify the authenticity of the powers of attorney. Additionally, the reporting agencies and Texaco did not respond to the requests to delete negative or delinquent accounts, once those accounts had been paid, because, in their opinion, deleting negative but accurate information rendered the credit reports false and misleading. However, the credit reporting agencies did send appellants' clients' credit reports directly to the clients and also responded directly to the clients concerning any "legitimate" inquiries. Those responses were often accompanied by an "information sheet" advising the clients of some of the risks of working with credit clinics and of their consumer rights, including their right to deal directly with the credit reporting agencies and creditors at no cost. The "information sheet" also advised appellants' clients that they could report any unsatisfactory experiences with credit clinics to the local attorney general or Better Business Bureau.
In order to continue to provide services to the clients, appellants began obtaining the clients' credit reports from collection agencies or resellers. Appellants would also prepare the necessary disputes for their clients and have the clients submit the disputes. However, after a period of time, appellants were no longer able to obtain the reports from collection agencies or resellers. Apparently, the credit reporting agencies had informed those agencies and resellers that credit clinics such as the corporate appellants used the reports for allegedly wrongful purposes, and the reports should not be provided to appellants. At approximately the same time, the credit reporting agencies were exchanging information with each other about the credit clinics through a "clinic task force," and Texaco began advertising the "PrivacyGuard" program, which provided Texaco credit card holders direct access to their credit reports. In addition to exchanging information about credit clinics in general, the clinic task force, which met about once a month, also conducted a limited survey on consumers' opinions of credit clinics. The task force later communicated the results, along with their own concerns about credit clinics, to the Federal Trade Commission (FTC). The FTC later began a public campaign on fraudulent credit clinics, although the corporate appellants were apparently never identified as a part of that group. The FTC also promulgated a set of telemarketing rules under which the FTC intended to prosecute fraudulent credit clinics.
In 1996, appellants sued the credit reporting agencies and Texaco, asserting various antitrust claims pursuant to the Texas Free Enterprise and Antitrust Act of 1983 ("the Texas Antitrust Act"). See Tex. Bus. Com. Code Ann. § 15.01-.52 (Vernon 2002). These claims consisted of conspiracy to boycott, restraint of trade, monopolization, attempt to monopolize, and conspiracy to monopolize. Additionally, appellants asserted claims for tortious interference with existing contracts and prospective business relationships. The complaints stemmed primarily from (a) the credit reporting agencies' refusal to provide appellants copies of their clients' credit reports; (b) the agencies' granting Texaco access to credit reports for purposes of the PrivacyGuard program; (c) the agencies' and Texaco's refusal to investigate credit disputes submitted by appellants on behalf of their clients; (d) the agencies' encouraging appellants' clients to deal directly with the bureaus and creditors; and (e) the agencies' lobbying for anti-credit clinic legislation. According to Danielson, these actions destroyed Money Masters, causing it to file for bankruptcy, and resulted in Masters System's failure.
Appellants also filed suit against Consumer Credit Counseling Service of Greater Dallas, Inc., National Foundation for Consumer Credit, and Equifax, Inc. The trial court subsequently dismissed those claims and they are not part of this appeal.
Money Masters filed for bankruptcy in December 1993. The bankruptcy was closed in November 1996.
The credit reporting agencies and Texaco answered by filing both general and verified denials and asserting various affirmative defenses, including estoppel, legal justification, privilege, statute of limitations, and the Noerr-Pennington doctrine. After the parties had conducted substantial discovery, the credit reporting agencies and Texaco also filed both individual and joint traditional and no evidence summary judgment motions on all of appellants' claims. The trial court heard these motions December 2, 1998. At the time, the live pleading was appellants' third amended petition. Two days later, the trial court entered the following order:
See E.R.R. President's Conference v. Noerr Motor Freight, Inc., 365 U.S. 127 (1961); United Mine Workers of Am. v. Pennington, 381 U.S. 657 (1965).
On December 2, 1998, came on to be heard the following Defendants' Motions for Summary Judgment, the Responses filed by Plaintiffs, and the replies and objections filed by defendants, and after hearing the arguments of counsel, the Court ORDERS:
Texaco['s] Motion for Summary Judgment is GRANTED.
Defendants' Joint Motion for Summary Judgment on [Danielson's] Claims . . . for Lack of Standing is GRANTED.
Defendants' Joint Motion for Summary Judgment on All Claims Asserted by Money Masters is GRANTED.
Defendants' Motion for Summary Judgment on All Claims Asserted in Plaintiff's Third Amended Petition is GRANTED.
We note this motion was filed by the credit reporting agencies. However, Texaco subsequently joined this motion, specifically adopting the arguments raised in the motion and also incorporating by reference the arguments made in its individual summary judgment motion.
Defendants' Motion for Partial Summary Judgment on the Basis of Statute of Limitations is DENIED.
Trans Union's Motion for Partial Summary Judgment on Plaintiffs' Causes of Action for Tortious Interference is DENIED.
Defendants' Motion for Partial Summary Judgment on Noerr-Pennington Affirmative Defense is DENIED.
By separate written instrument, the court also entered a final "take nothing" judgment dismissing appellants' suit with prejudice.
On appeal, appellants present six points of error. In their first point, appellants argue (a) the trial court's judgment lacks finality and is fatally defective; and (b) the credit reporting agencies are judicially estopped from appealing any rulings unfavorable to them. In their second through sixth points of error, appellants challenge the court's order granting the following motions:
(a) the credit reporting agencies' and Texaco's joint motion for summary judgment on Danielson's claims for lack of standing;
(b) the credit reporting agencies and Texaco's joint motion for summary judgment on all claims asserted by Money Masters;
(c) Texaco's motion for summary judgment; and,
(d) the credit reporting agencies and Texaco's motion for summary judgment on all claims asserted in the third amended petition.
In two conditional cross-points, the credit reporting agencies contend the court erred in denying their motions for partial summary judgment on the basis of limitations and the Noerr-Pennington doctrine. Since our jurisdiction in this case is contingent upon having a final, appealable judgment, we begin by addressing appellant's first point of error. See Tex. Civ. Prac. Rem. Code Ann. §§ 51.012, 51.014 (Vernon 1997 Supp. 2003); Lehmann v. Har-Con Corp., 39 S.W.3d 191, 195 (Tex. 2001).
Finality and Validity of Judgment
In their first point of error, appellants contend the trial court entered a "fatally defective final judgment." Appellants base their contention on the following docket sheet entry:
D's msj (). Texaco granted (leave to supp granted) on vicarious lia; all granted on jud estop, tortious int conspiracy, anti-trust ok, (Noerr-Pennington), ind claims of Danielson. Ok as to anti-trust, boycott, . , tort int, s of l. (judge's initials)
On the docket sheet, "Noerr-Pennington" is circled with an arrow pointing down towards the portion that states "ok as to boycott. . ."
Appellants maintain this entry reflects they prevailed on the interference, antitrust, and boycott claims, and also on appellees' affirmative defenses of Noerr-Pennington and statute of limitations. Appellants note, however, that the order actually entered by the court grants the motion for summary judgment on all claims asserted in the third amended petition, a motion not mentioned in the docket sheet entry, while at the same time appearing to leave the interference claims to be tried. Because the interference claims purportedly remain outstanding, appellants argue the judgment is not final, despite its language dismissing appellants' action. Additionally, because of the discrepancy between the docket sheet and the order, appellants argue the order is fatally defective. Appellants assert the docket sheet entry controls, and, because the credit reporting agencies and Texaco prepared the "fatally defective" order, the credit reporting agencies are judicially estopped from challenging the judgment. We reject appellants' contentions.
As the parties are aware, we, too, questioned the finality of the judgment and by order issued July 18, 2002, abated the appeal to allow the trial court to enter a final appealable judgment. Specifically, we directed the trial court to dispose of the interference claims and modify the judgment so as to make it a final appealable judgment. We also directed the clerk to file a supplemental record containing the modified judgment. On November 27, 2002, we reinstated the appeal, after receiving the supplemental record.
We have reviewed that record and conclude the modified judgment is in fact final and appealable. This judgment expressly and unequivocally adjudicates all parties and claims. See Lehmann, 39 S.W.3d at 192-93. Accordingly, appellants' complaint that the judgment is not final is now moot.
Having concluded the judgment is final, we now address appellants' complaint concerning the validity of the judgment. In support of their contention that the order disposing of the various summary judgment motions is in fatal conflict with the docket sheet and the docket sheet controls, appellants cite Hardtke, Inc. v. Katz, 813 S.W.2d 548 (Tex.App.-Houston [1st Dist.] 1991, no writ). In Hardtke, the court considered the effect of a signed docket sheet entry which reinstated an improperly dismissed case. Id. at 550. The trial court had signed an order dismissing the case the previous day. Id. Apparently realizing the dismissal was in error, the trial court then signed the docket entry reinstating the case but did not sign a separate written order. Id. Although recognizing that a docket entry of what the judgment purports to be cannot override or cast doubt upon the written judgment where the two are different, see N-S-W Corp. v. Snell, 561 S.W.2d 798, 799 (Tex. 1977) (orig. proceeding), the Hardtke court nonetheless concluded, under the facts before it, the docket entry effectively reinstated the case. Hardtke, 813 S.W.2d at 551. In so concluding, the court noted the docket entry was unambiguous. Id. The court also noted it was not using the docket entry as evidence of what the dismissal judgment purported to be — each was "entirely separate, and the meaning of each [was] clear." Id.
We fail to find Hardtke binding. As the credit reporting agencies and Texaco point out, Hardtke is limited to its facts. Id.; Intercity Mgmt. Corp. v. Chambers, 820 S.W.2d 811, 812-13 (Tex.App.-Houston [1st Dist.] 1991, no writ). Additionally, unlike in Hardtke, appellants here rely on the docket entry to specifically override the written judgment, which is impermissible. N-S-W, 561 S.W.2d at 799. Because Hardtke is distinguishable from the case before us, we conclude the judgment is not defective on the basis alleged by appellants.
Having concluded the judgment is not defective, we now address appellants' final contention, under this point of error, that the credit reporting agencies are precluded from appealing those rulings unfavorable to them because they drafted the order on the various summary judgment motions. It is well settled that a party cannot appeal from or attack a judgment to which he has consented or agreed absent an allegation of proof of fraud, collusion, or misrepresentation. Gillum v. Rep. Hlth. Corp., 778 S.W.2d 558, 562 (Tex.App.-Dallas 1989, no writ). In this case, however, the credit reporting agencies did not consent to the judgment by the mere drafting of the order. The order recites it is based on the summary judgment hearing during which the court considered the arguments of all parties and then made its rulings. Nothing in the record even suggests the order was based on any agreement among the various parties. We conclude the credit reporting agencies are not precluded from challenging those rulings unfavorable to them. We overrule appellants' first point of error.
The Challenged Summary Judgment Motions
In their second and third points of error, appellants contend the court erred in granting the motion for summary judgment on all claims asserted in the third amended petition. In this motion, the credit reporting agencies and Texaco asserted they were entitled to summary judgment on both the antitrust and tortious interference claims because their alleged anti-competitive and tortious acts were justified. Additionally, the credit reporting agencies and Texaco asserted they were entitled to summary judgment on the antitrust claims because appellants (a) lacked standing to bring those claims; and (b) neither the credit reporting agencies nor Texaco participated in the relevant market or conspired together, which are elements necessary to prove the antitrust claims.
When, as here, the trial court does not specify the grounds for granting summary judgment in which more than one ground is alleged, we will affirm the judgment if any of the grounds advanced are meritorious. Rogers v. Ricane Enterps., Inc., 772 S.W.2d 76, 79 (Tex. 1989); Provencio v. Paradigm Media, Inc., 44 S.W.3d 677, 680 (Tex.App.-El Paso 2001, no pet.). Because we conclude the credit reporting agencies and Texaco's conduct was justified, we conclude summary judgment in their favor on all of appellants' claims was proper. In reaching this conclusion, we assume, without deciding, appellants have standing and produced evidence of each of the essential elements of their claims.
Justification is an affirmative defense to both an antitrust claim and a claim for tortious interference. Tex. Bus. Com. Code Ann. § 15.05(g) (Vernon 2002) (antitrust claims); Calvillo v. Gonzalez, 922 S.W.2d 928, 929 (Tex. 1996) (tortious interference claims). Justification can be based on the exercise of either (1) the party's own legal rights or (2) the party's good faith claim to a colorable right, even though the claim ultimately proves to be mistaken. Tex. Beef Cattle Co. v. Green, 921 S.W.2d 203, 211 (Tex. 1996). When the party conclusively establishes it had a legal right to engage in the complained-of conduct, the party's motive for engaging in that conduct is irrelevant. Id.
In this case, the credit reporting agencies and Texaco contend their conduct towards appellants was justified under sections 1681b and 1681e of the Fair Credit Reporting Act ("FCRA"). See 15 U.S.C. § 1681b, 1681e (1993 Supp. 2002). Section 1681b specifies under what circumstances credit reporting agencies may release consumer reports. Id. § 1681b. Section 1681e mandates the credit reporting agencies limit the disclosure of consumer reports in accordance with section 1681b, and requires reporting agencies ensure the reports are as accurate as possible. Id. § 1681e.
Those circumstances or "permissible purposes" are:
* in response to a court order issued in conjunction with proceedings before a federal grand jury;
* in accordance with the written instructions of the consumer to whom it relates;
* to a person which it has reason to believe intends to use the information in connection with a credit transaction involving the consumer, for employment purposes, in connection with the underwriting of insurance involving the consumer, in connection with a determination of the consumer's eligibility for a license or other benefit granted by a governmental instrumentality required by law to consider the applicant's financial responsibility or status, as a potential investor or servicer in connection with a valuation or assessment of the credit or repayment risks associated with an existing credit obligation, or otherwise has a legitimate business need to the information in connection with a business transaction initiated by the consumer, or to review an account to determine if the consumer continues to meet the terms of the account;
* in response to a request by the head of a state or local child support enforcement agency under specific circumstances; and
* to an agency administering a state plan under section 454 of the Social Security Act for use to set an initial or modified child support award.
See 15 U.S.C. § 1681b (Supp. 2002).
In support of their defense, the credit reporting agencies and Texaco presented evidence showing the complained-of conduct resulted from appellants' obtaining credit reports to determine what negative but accurate information they could attempt to have deleted from their clients' reports, a purpose not listed in section 1681b. The credit reporting agencies and Texaco also presented evidence showing that, in their opinion, the deletion of negative but accurate information affects the integrity of the credit reporting process. Because section 1681e requires the credit reporting agencies to limit disclosure of reports in accordance with section 1681b, the credit reporting agencies and Texaco argued the complained-of conduct was necessary.
In response, appellants argued there are no restrictions under the FCRA in terms of a consumer's right "to dispute the `completeness' or `accuracy' of credit report items." See id. § 1681(a)(1)(A) (the consumer may dispute any item of information contained in a consumer's file). Moreover, appellants argued, the only remedy granted by FCRA to a credit reporting agency which determines a dispute is "frivolous or irrelevant" is to terminate a reinvestigation, see id. § 1681i(3)(A), but pursuant to section 1681b, the reporting agency must still provide the report "in accordance with the written instructions of the consumer to whom it relates." Because appellants were acting on behalf of consumers who had granted them powers of attorney, appellants maintained the credit reporting agencies were required to provide the reports. In the alternative, appellants maintained the credit reporting agencies could not avail themselves of the defense of justification because their actions constituted a group boycott which was illegal per se. See Times Herald Printing v. A.H.Belo Corp., 820 S.W.2d 206, 211 (Tex. App-Houston [14th Dist.] 1991, no writ). Finally, with respect to their tortious interference claims, appellants also argued the reporting agencies could not avail themselves of the defense of justification because the "information sheets" the reporting agencies mailed to appellants' clients, informing them of their rights and advising them of some of the risks associated with working with credit clinics, were defamatory on their face.
Before addressing the parties' arguments, we pause to note that, in addressing the motion for summary judgment on all claims in the third amended petition, both at the trial court level and on appeal, appellants limited their arguments to the credit reporting agencies. Although appellants were entitled to present argument as to Texaco also, appellants failed to do so. See Malooly Bros., Inc. v. Napier, 461 S.W.2d 119, 121 (Tex. 1970). Thus, they have waived any error with respect to Texaco. See Morriss v. Enron Oil Gas Co., 948 S.W.2d 858, 871 (Tex.App.-San Antonio 1997, no writ).
We now turn to appellants' argument that the justification defense does not apply with respect to the letters the credit reporting agencies sent to appellants' clients because the letters were defamatory on their face. We agree with appellants that the justification defense is not available where the plaintiff pleads and proves methods of interference that are tortious in themselves, such as defamation. See Prudential Ins. Co. v. Fin'l Rev. Servs., Inc., 29 S.W.3d 74, 80 (Tex. 2000). However, we disagree that the complained-of letters in this case were defamatory. As the reporting agencies note, the letters do not specifically refer to appellants and are consistent with disclosures required under current state and federal law. See, e.g., 15 U.S.C. § 1679c (2002) (providing specifically that credit repair organizations inform consumers of their rights and stating what the organizations must say); Tex. Fin. Code § 393.105 (Vernon 1998) (same). We conclude appellants' contention lacks merit and the reporting agencies could avail themselves of the justification defense with respect to the letters.
We next address appellants' argument that the justification defense does not apply because the credit reporting agencies' conduct constituted a per se illegal group boycott. Appellants correctly argue that a party may recover for tortious interference and antitrust claims by showing an illegal boycott. See U.S. v. Realty Multi-List, Inc., 629 F.2d 1351, 1362-63 (5th Cir. 1980) (the per se rule is the trump card of antitrust law, and when an antitrust plaintiff successfully plays it, he need only tally his score); Wal-Mart Stores, Inc. v. Sturges, 52 S.W.3d 711, 726 (Tex. 2001) (tortious interference). However, as the credit reporting agencies point out, to be subject to per se analysis, the complained-of conduct must be without "redeeming virtue." Realty Multi-List, 629 F.2d at 1363. Where conduct is expressly authorized by statute, it cannot be said to be without redeeming virtue. Hatley v. Am. Quarter Horse Ass'n, 552 F.2d 646, 653 (5th Cir. 1977).
Because the Texas Antitrust Act is modeled after the Sherman Antiturst Act and the Clayton Act, see 15 U.S.C. § 1-37a (1997 Supp. 2002), we construe it in harmony with federal judicial interpretations of comparable federal antitrust statutes. Tex. Bus. Com. Code Ann. § 15.04 (Vernon 1987); Caller-Times Publ'g Co. v. Triad Communications, Inc., 826 S.W.2d 576, 580 (Tex. 1992).
In this case, the credit reporting agencies presented evidence showing their actions were in accordance with section 1681e, because appellants' use of credit reports to attempt to delete negative but accurate information is not specifically authorized by section 1681b and reporting agencies must ensure "maximum possible accuracy of the information" in the report. Additionally, section 1681b is a permissive statute, specifically stating reporting agencies "may" furnish reports to third parties but only under the listed circumstances. See 15 U.S.C. § 1681b. The credit reporting agencies were under no statutory obligation to provide appellants with any reports. We conclude the reporting agencies' conduct was authorized by statute, and accordingly is not subject to a per se analysis.
Having concluded the credit reporting agencies could avail themselves of the justification defense, we also conclude the agencies conclusively established the elements of justification because they established their conduct was in accordance with a federal statute. When a defendant conclusively establishes each element of an affirmative defense, he is entitled to summary judgment, unless the plaintiff presents evidence creating a fact issue on one of the elements. Sci. Spectrum, Inc. v. Martinez, 941 S.W.2d 910, 911 (Tex. 1997); Provencio, 44 S.W.3d at 681. Accordingly, the burden shifted to appellants to present evidence creating a fact issue.
As the credit reporting agencies point out, however, appellants failed to do so. To the extent appellants complain summary judgment on their antitrust and tortious interference claims on the basis of justification was improper, we overrule their second and third points of error.
Because we have concluded summary judgment was proper on the basis of justification, we need not address appellants' remaining points of error. See Rogers, 772 S.W.2d at 79. We also need not reach the credit reporting agencies' conditional cross-points. See Tex.R.App.P. 47.1.
We affirm the trial court's judgment.