Opinion
14-22-00017-CV
08-24-2023
POWER ELECTRIC DISTRIBUTION, INC., Appellant v. TELCO INTERCONTINENTAL CORP., Appellee
On Appeal from the 215th District Court Harris County, Texas Trial Court Cause No. 2018-08811
Panel consists of Justices Wise, Zimmerer, and Wilson.
MEMORANDUM OPINION
Ken Wise Justice
Appellant Power Electric Distribution, Inc. (PED) appeals the trial court's judgment in favor of appellee Telco Intercontinental Corp. (Telco). PED raises five issues on appeal. First, the trial court erred in considering Telco's motion to strike PED's evidence on an expedited basis and without allowing PED time to respond. Second, the trial court erred in excluding PED's evidence. Third, the trial court erred in granting traditional summary judgment on PED's claims. Fourth, the trial court erred in granting no-evidence summary judgment on PED's claims. Fifth, the trial court erred in denying PED's motion for reconsideration.Assuming without deciding the trial court erred in excluding the evidence, we conclude the trial court properly granted Telco's no-evidence summary judgment. We affirm.
While PED raised this fifth issue in its "Issues Presented" section, PED did not brief the fifth issue. The only issue in PED's motion for reconsideration not otherwise already presented on appeal is PED's request that the trial court reconsider its motion for continuance on Telco's summary judgment due to a lack of discovery responses from Telco. However, there is no contention in the reconsideration of what discovery PED expected to receive and how such discovery was material or that PED exercised due diligence in obtaining the discovery sought. See Joe v. Two Thirty Nine Joint Venture, 145 S.W.3d 150, 161 (Tex. 2004) ("We have considered the following nonexclusive factors when deciding whether a trial court abused its discretion in denying a motion for continuance seeking additional time for discovery: the length of time the case has been on file, the materiality and purpose of the discovery sought, and whether the party seeking the continuance has exercised due diligence to obtain the discovery sought.").
NO-EVIDENCE SUMMARY JUDGMENT
In PED's fourth issue, PED argues that the trial court erred in granting Telco's no-evidence summary judgment. Because we conclude this issue is dispositive, we address it first.
A. General Legal Principles
We review a summary judgment de novo. Rosetta Res. Operating, LP v. Martin, 645 S.W.3d 212, 218 (Tex. 2022). When a party moves for both traditional and no-evidence summary judgment, we first review the no-evidence summary judgment. Ford Motor Co. v. Ridgway, 135 S.W.3d 598, 600 (Tex. 2004). If the no-evidence motion was properly granted, we do not reach the arguments made for traditional summary judgment. Id. The non-movant must produce summary judgment evidence raising a genuine issue of material fact to defeat a no-evidence motion. Id. "A genuine issue of material fact exists if more than a scintilla of evidence establishing the existence of the challenged element is produced." Id.
Where, as here, the trial court does not specify the grounds relied upon for its ruling, we will affirm on any meritorious ground. See Martin, 645 S.W.3d at 227 ("When a trial court's order granting summary judgment does not specify the grounds on which its order is based, the appealing party must negate each ground upon which the judgment could have been based."). We review the record in the light most favorable to the non-movant, indulging every reasonable inference and resolving any doubts against the movant. Sudan v. Sudan, 199 S.W.3d 291, 292 (Tex. 2006).
To recover for tortious interference with a contract a plaintiff must prove: (1) the existence of a contract subject to interference; (2) that the defendant willfully and intentionally interfered with the contract; (3) that the interference was the proximate cause of the plaintiff's injury; and (4) that the plaintiff incurred actual damage or loss. Comm. Health Sys. Prof'l Servs. Corp. v. Hansen, 525 S.W.3d 671, 689 (Tex. 2017). Interference with a contract is only tortious if intentional. Sw. Bell Tel. Co. v. John Carlo Tex., Inc., 843 S.W.2d 470, 472 (Tex. 1992). "Intentional interference does not require intent to injure, only that 'the actor desires to cause the consequences of his act, or that he believes that the consequences are substantially certain to result form it.'" Hansen, 525 S.W.3d at 689 (quoting Sw. Bell Tel. Co., 843 S.W.2d at 472)).
"To establish the element of a willful and intentional act of interference, a plaintiff must produce some evidence that the defendant was more than a willing participant and knowingly induced one of the contracting parties to breach its obligations under a contract." Reg'l Specialty Clinic, P.A. v. S.A. Randle & Assocs., P.C., 625 S.W.3d 895, 902 (Tex. App.-Houston [14th Dist.] 2021, no pet.). To prove the requisite element of intent, the plaintiff must show either "(1) that the interfering party had actual knowledge of the existence of the contract and of the plaintiff's interest in it, or (2) that the interfering party had knowledge of such facts and circumstances that would lead a reasonable person to believe in the existence of the contract and the plaintiff's interest in it." Id. at 903 n.6.
B. Background
PED and Telco are competitors-both companies design motors that open doors. Both companies work with Chinese factories to build the motors they design and sell. PED alleges that Telco tortiously interfered with PED's contract with a Chinese company, Taizhou Jinweida Motor Company, Limited (JWD). PED contracted with JWD to manufacture the motors designed by PED. Both PED and Telco were trying to obtain business from Norton Door. Telco alleged PED tortiously interfered with its contract to sell motors to Norton Door. Telco filed suit against PED for tortious interference with Telco's contract to supply motors to Norton Door. PED filed a counterclaim against Telco for tortious interference with PED's contract with JWD.
Neither JWD nor Norton Door are parties to this appeal.
Telco filed a no-evidence and traditional summary judgment motion on PED's counterclaim of tortious interference. In the no-evidence motion Telco argued that PED had no evidence that Telco "willfully interfered with" or even knew about PED's contract with JWD. PED filed a response arguing that certain emails between Telco and JWD established that Telco knew it was interfering with PED's contract with JWD.
In the emails between Telco and JWD, exhibits eight and nine to PED's response, the representatives discuss possible collaboration on three to six projects. The two companies set up an in-person meeting and discuss the agenda for the meeting, as well as particulars such as picking up and dropping off Telco representatives at the airport and train station in China. In one email Telco asks JWD about testing, stating "you mentioned that you have some life testing data done by you or your customer. Can you share with us (if any), as we need to know your design gearbox life hours." In exhibit nine, Telco indicated its need for a specific type of motor and asked JWD if they have any "similar motor products." The companies again exchanged emails regarding the motor request. Telco requested the performance parameters for the motor. Later Telco requested the electrical parameters and the "type and specification of grease" and the "type of reducer O-ring and the type of surface treatment of the output shaft." In response, JWD emailed Telco and indicated its willingness to provide the performance and grease test reports but requested to discuss further details at their in-person meeting. PED argues that these emails establish that Telco knew it was willfully and intentionally interfering with the contract between JWD and PED.
We focus on exhibits eight and nine as they were referenced in both PED's response to the no-evidence motion in the trial court and in PED's brief as the evidence of Telco's willful and intentional interference with the contract.
C. Analysis
PED argues there "is evidence in the record that creates a strong inference that Telco knew it was inducing JWD to breach the confidentiality provisions of PED's" agreement with JWD. PED points to the emails detailed above arguing that it "is obvious, the two exchanged testing results and other confidential information. [Telco] even acknowledged that JWD provided test information from other manufacturers and sought more confidential information." PED further contends that the reason a JWD employee wanted to discuss the details of the test results at a "face to face" meeting instead of by email was because "Telco was requesting information that was confidential" under the agreement between JWD and PED. PED argues that this "put Telco on notice that it was seeking confidential information that JWD did not want to share electronically so there would not be a record of it in the event there was litigation." Finally, PED argues that we can infer from the emails that Telco and JWD "discussed further details and testing samples when they met face to face."
Assuming without deciding that the trial court erred in excluding PED's evidence, we consider the evidence cited by PED in determining whether the trial court erred in granting Telco's no-evidence summary judgment.
We disagree with PED that the emails constitute any evidence that Telco had either actual knowledge of the contract between PED and JWD or that the emails alone are knowledge of such facts and circumstances that would lead a reasonable person to believe in the existence of the contract and PED's interest in it. See Reg'l Specialty Clinic, P.A., 625 S.W.3d at 903 n.6. Instead, the emails show that JWD was sharing information regarding the test results, but there is no indication in these emails that Telco should have known that such information was confidential, let alone confidential as a result of a contract between JWD and PED. PED asks us to infer that one reasonable explanation is that JWD did not want to communicate by email was that it did not want a "paper-trail" because it knew it was sharing information it should not be sharing under the contract between JWD and PED. While this may be one reasonable explanation for JWD's actions, this does not show any action on Telco's part and alone is not enough to put Telco on notice of the existence of a contract and PED's interest in it. See Browning-Farris, Inc. v. Reyna, 865 S.W.2d 925, 926-27 (Tex. 1993) ("In the form offered, this testimony implies that [the defendant] may have been a willing participant; it does not establish that [the defendant] . . . was engaged in any improper conduct."). This evidence alone is not enough to survive a no-evidence summary judgment as it does not rise above a scintilla. See Lozano v. Lozano, 52 S.W.3d 141, 145 (Tex. 2001) ("To rise above a scintilla, the evidence offered to prove a vital fact must do more than create a mere surmise or suspicion of its existence."); Reyna, 865 S.W.2d at 927 ("[S]ome suspicion linked to other suspicion produces only more suspicion, which is not the same as some evidence.").
PED next argues that Telco cannot dispute that it had actual knowledge of the contract by 2018 when PED sent Telco a cease-and-desist letter. PED argues that despite this actual knowledge of the contract between PED and JWD, Telco continued "to carry out its own contract with JWD." However, we disagree with PED that this constitutes any evidence that Telco knowingly induced JWD to breach its agreement with PED. "A necessary element of the plaintiff's cause of action is a showing that the defendant took an active part in persuading a party to a contract to breach it. Merely entering into a contract with a party with the knowledge of that party's contractual obligation to someone else is not the same as inducing a breach." Davis v. HydPro, Inc., 839 S.W.2d 137, 139 (Tex. App.- Eastland 1992, writ denied) (internal quotations omitted); John Paul Mitchell Sys. v. Randalls Food Markets, Inc., 17 S.W.3d 721, 731 (Tex. App.-Austin 2000, pet. denied); Arabesque Studios, Inc. v. Academy of Fine Arts Int'l, Inc., 529 S.W.2d 564, 568 (Tex. App.-Dallas 1975, no writ) (plaintiff's burden to show that defendant caused interference; it is not enough to show that defendant reaped advantage of contract broken by the breaching party's own volition).
We overrule PED's fourth issue.
Because we conclude that summary judgment was proper on this ground considering the evidence excluded by the trial court, we need not address PED's remaining issues regarding the propriety of excluding the exhibits, the expedited consideration and ruling on Telco's motion to strike PED's exhibits, or whether traditional summary judgment was proper. See Tex. R. App. P. 47.1.
CONCLUSION
Assuming without deciding that the trial court erred in excluding the evidence attached to PED's response to Telco's motion for summary judgment, we conclude there is no evidence Telco willfully and intentionally interfered with PED and JWD's contract. Therefore, we overrule PED's fourth issue and affirm the trial court's judgment.