NO.

07-16-00320-CV

IN THE COURT OF APPEALS

FOR THE SEVENTH DISTRICT OF TEXAS
AT AMARILLO

TIMOTHY CASTLEMAN AND

CASTLEMAN CONSULTING, LLC,
Appellant
vs.
INTERNET MONEY LIMITED AND
KEVIN OCONNOR
Appellee
On Appeal from the 237th District Court of Lubbock County, Texas
Trial Court Cause No. 2016-519,740
Honorable Les Hatch, Presiding

REPLY BRIEF FOR APPELLEE

Respectfully submitted,
FIELD, MANNING, STONE,
HAWTHORNE, AND AYCOCK, P.C.
2112 Indiana Ave.
Lubbock, Texas 79410
Tel: (806) 792-0810
Fax: (806) 792-9148
Anna McKim, SBN 24033381
amckim@lubbocklawfirm.com
J. Paul Manning, SBN 24002521
jpmanning@lubbocklawfirm.com
Attorneys for Appellee
ORAL ARGUMENT CONDITIONALLY REQUESTED

Table of Contents
Index of Authorities .................................................................................................3
Statement of the Case ..............................................................................................2
Statement on Oral Argument .................................................................................3
Issue Presented .........................................................................................................3
Facts ...........................................................................................................................3
A. The Underlying Defamation .........................................................................3
B. Castlemans TCPA Motion to Dismiss ........................................................5
C. OConnors TCPA Dismissal Response.......................................................6
1. Prima Facie Case ......................................................................................7
2. Fact Issues to Affirmative Defense..........................................................7
D. Reply and Ruling ...........................................................................................7
Summary of the Argument .....................................................................................8
Argument ..................................................................................................................9
A. Exemption for Commercial Speech ..........................................................10
B. Shifting Burdens ..........................................................................................18
1. Castlemans burden to establish OConnor sued him because he
exercised a protected right .....................................................................18
2. OConnors prima facie case .................................................................19
C. Only Castleman, Individually, Moved to Dismiss. ...................................28
D. Attorneys Fees and Expenses ....................................................................28
Prayer ......................................................................................................................29
Certificate of Compliance......................................................................................30
Certificate of Service ..............................................................................................31

ii

Index of Authorities
Cases
Am. Heritage Capital, LP v. Gonzalez,
436 S.W.3d 865 (Tex. App.Dallas 2014, no pet.) ........................................22
Backes v. Misko,
486 S.W.3d 7 (Tex.App.Dallas 2015, pet. denied) ............................... 10, 14
Better Bus. Bureau of Metro. Dallas, Inc., v. BHD FW, Inc.,
402 S.W.3d 299 (Tex.App.Dallas 2013, pet. denied) ..................... 10, 13, 16
Campbell v. Clark,
471 S.W.3d 615 (Tex. App.Dallas, 2015, no pet.) ............................ 9, 20, 21
Combined Law Enf't Ass'n v. Sheffield,
No. 03-13-00105-CV, 2014 Tex. App. LEXIS 1098, 2014 WL 411672, (Tex.
App.Austin Jan. 31, 2014, pet. filed) (mem. op.) ........................................29
D Magazine Partners, L.P. v. Rosenthal,
475 S.W.3d 470 (Tex.App.Dallas 2015, pet. granted) .............. 19, 20, 21, 24
Hancock v. Variyam,
400 S.W.3d 59 (Tex. 2013) ..............................................................................25
In re Lipsky,
460 S.W.3d 579 (Tex.2015) ................................................ 9, 10, 19, 20, 27, 28
Kinney v. BCG Atty. Search, Inc.,
No. 03-12-00579-CV, 2014 WL 1432012, 2014 Tex. App. LEXIS 3998
(Tex.App.Austin April 11, 2014, pet. denied) ...................................... 15, 16
Miller Weisbrod, LLP v. Llamas-Soforo,
No. 08-12-00278-CV, 2014 Tex. App. LEXIS 12745, 2014 WL 6679122
(Tex.App.El Paso Nov. 25, 2014, no pet.) ...................................................17
Moldovan v. Polito,
No. 05-15-01052-CV, 2016 Tex. App. LEXIS 8283, (Tex. App. Dallas Aug.
2, 2016) .............................................................................. 14, 19, 20, 21, 25, 28
Morrill v. Cisek,
226 S.W.3d 545 (Tex. App.Houston [1st Dist.] 2006, no pet.) ...................25
NCDR, LLC v. Mauze & Bagby, PLLC,
745 F.3d 742 (5th Cir. 2014) ..................................................................... 16, 17
Scripps Tex. Newspapers, L.P. v. Belalcazar,
99 S.W.3d 829 (Tex. App.Corpus Christi 2003, pet. denied) ......................26
Simpson Strong-Tie Co., Inc. v. Gore,
49 Cal. 4th 12, 109 Cal. Rptr. 3d 329 P.3d 1117 (Cal. 2010) ................... 12, 17
Tex. Disposal Sys. Landfill, Inc. v. Waste Mgmt Holdings, Inc.,
219 S.W.3d 563 (Tex.App.Austin 2007, pet. denied)..................... 25, 26, 27
iii

Turner v. KTRK Television, Inc.,

38 S.W.3d 103 (Tex. 2000) ..............................................................................24
United Servs. Auto Assn v. Croft,
175 S.W.3d 457 (Tex.App.Dallas 2005, no pet.) .........................................20
Vander-Plas v. May,
No. 07-15-00454-CV, 2016 Tex. App. LEXIS 10822 (Tex. App.Amarillo,
October 4, 2016, mem. op.)....................................................................... 18, 20
Waste Mgmt. of Texas, Inc. v. Tex. Disposal Sys. Landfill, Inc.,
434 S.W.3d 142 (Tex. 2014) ............................................................................27

Statutes
Tex. Civ. Prac. & Rem. Code Ann. 27.001 ............................................................9
Tex. Civ. Prac. & Rem. Code Ann. 73.001 ..........................................................25
Texas Citizenship Participation Act 27.002 .........................................................10
Texas Citizenship Participation Act 27.003 .................................................... 9, 16
Texas Citizenship Participation Act 27.005 ........................................ 9, 10, 18, 23
Texas Citizenship Participation Act 27.009 .........................................................29
Texas Citizenship Participation Act 27.010 .................................................. 10, 11
Texas Citizenship Participation Act 27.055 .........................................................19

Other Authorities
Restatement (Second) of Torts 573 ......................................................................25
Restatement (Second) of Torts 580B ....................................................................26

iv

NO. 07-16-00320-CV

IN THE COURT OF APPEALS

FOR THE SEVENTH DISTRICT OF TEXAS
AT AMARILLO

TIMOTHY CASTLEMAN AND

CASTLEMAN CONSULTING, LLC,
Appellant
vs.
INTERNET MONEY LIMITED AND
KEVIN OCONNOR
Appellee
On Appeal from the 237th District Court of Lubbock County, Texas
Trial Court Cause No. 2016-519,740
Honorable Les Hatch, Presiding

REPLY BRIEF FOR APPELLEE

TO THE HONORABLE COURT OF APPEALS:

COME NOW INTERNET MONEY LIMITED and KEVIN OCONNOR,
Appellee, and files this brief in response to the appeal of TIMOTHY CASTLEMAN
and CASTLEMAN CONSULTING, LLC, Appellant, and would respectfully show
the following:

Statement of the Case

Nature of the Case

Internet Money Limited, d/b/a The

Offline Assistant, a corporation of
Dublin, Ireland, and Kevin OConnor,
a resident of Dublin, (collectively
OConnor) sued Timothy Castleman
and Castleman Consulting, LLC, a
Texas limited liability company, for
slander and libel (CR 9-15). Castleman
and the LLC answered asserting a
general denial, various affirmative
defenses, and special exceptions (CR
6-8).

Trial Court

237th District Court of Lubbock

County, Texas
The Honorable Les Hatch, Presiding

Trial Court Proceedings

Castleman filed untimely for dismissal

under the Texas Citizenship
Participation Act (TCPA) (CR 1666) and OConnor responded to same
(CR 67-222).

Trial Court Disposition

The court granted relief from

Castlemans technical failure and
denied the motion to dismiss and all
claims for attorneys fees (CR 230232).

Statement on Oral Argument

Castleman has requested oral argument. OConnor does not anticipate oral
argument would be helpful for the Court but would like to participate if granted. The
record in this matter is straightforward, so OConnor believes the matter is most
expeditiously considered on the merits of the briefing.

Issue Presented
The trial court properly denied the motion to dismiss because the
commercial exemption precludes application of the Texas Citizens
Participation Act. In the alternative, OConnor properly provided
prima facie evidence of each elements of his claims and Castleman
failed to show, by a preponderance of the evidence, any defense to
same.

Facts
Internet Money Limited d/b/a The Offline Assistant and Kevin OConnor,
collectively referred to as OConnor, sued Timothy Castleman and Castleman
Consulting, LLC (CC, LLC) for slander and libel (CR 9-15).
A.

The Underlying Defamation

In January 2015, CC, LLC hired The Offline Assistant to perform various

task-based services, including fulfilling internet orders on CC, LLCs behalf (CR

10). The instructions provided by CC, LLC directed Offline Assistant to double
orders it received by the following directive:
Pay special attention to the rows Variation and Volume. The
volume of the [product item] means that if someone ordered 1 of the
item in the store, then we would order 2 in Aliexpress. If someone
orders 2 in the store then we would order 4 on Aliexpress.
(CR 11, 44). The Offline Assistant confirmed these instructions through
communications with a CC, LLC representative who again instructed Offline
Assistant to double all orders it received unless specifically directed otherwise (CR
11, 44-45).
On or about November 20, 2015, CC, LLC contacted Offline Assistant
alleging improper doubling of orders (CR 11, 43-45). Offline Assistant responded
that it had properly ordered all items as directed in the instructions (CR 11, 44-45,
51-54).
Thereafter, Castleman or someone with access to the Google Drive original
instruction format sent by CC, LLC edited the original instructions to double all
orders (CR 11, 62). Offline Assistant was made aware of this change to the
instructions via the Google Drive notification procedure after the November 23,
2015 conversation with CC, LLC (CR 11, 61). CC, LLC then sought charge back
for fees paid in October and November (CR 11, 47-48).
Castleman and CC, LLC then began an intentional and specific campaign to
defame OConnor. Specifically, Castleman and CC, LLC took to multiple forums
4

including Facebook, Twitter, a blog, Warrior Forum, Google Reviews, and podcasts
to publish false and misleading accounts of Defendants dealings with Plaintiff,
including but not limited to false statements regarding (a) failed promises, (b) 80%
to 85% error rate in the orders placed, (c) inability or unwillingness to follow
instructions, (d) theft from Defendants, and (e) provision of terrible services (CR 1112, 133-95). These statements were made with the knowledge of their falsity or, at
the very least, with negligence (CR 12). In fact, Castleman recognized and gloated
about the damage he was causing OConnor (CR 12, 197-204 and Application for
TRO filed herein).
B.

Castlemans TCPA Motion to Dismiss

In response to the petition, Castleman and CC, LLC filed an answer with a

general denial, special exceptions, and affirmative defenses of the claims having
been filed with named parties in inappropriate capacities (CR 6-8).
Castleman, individually, filed an untimely motion to dismiss under the TCPA
(CR 16-66), alleging his statements were not defamatory and do not fall within an
exception to the TRCP (CR 16). The motion only requests relief for Castleman,
requesting relief for him for his costs, fees, and expenses and for all other relief
to which he may be entitled (CR 16, 25).
In the motion, Castleman undertook his version of the facts regarding
instructions provided to OConnors entities, referring to OConnor and the entities
5

collectively as OConnor (CR 17-66). He then undertakes the following analysis

of the alleged failure of Castlemans prima facie case:
A.
Castlemens statements are true (CR 22-23). In the motion,
Castleman cites to no particular evidence except Exh. __ to support his
assertion that [t]his is what happened.
B.
Castlemans statements are privileged (CR 23). Again, Castleman
cites to no particular evidence in his motion but makes assertions under
various case law that his statements are privileged and protected, with the
audience identified as consumers of outsourcing services. (CR 23).
C.
Castlemans other statements are hyperbole, and no reasonable person
could believe otherwise (CR 23). Again, Castleman cites to no evidence and
simply argues statements that are opinion cannot accuse of criminal activity,
so OConnors claims must be dismissed (CR 24).
D.
The Court must award Castleman his fees and expenses (CR 24).
Castleman alleges he must be awarded his fees of $6,492 (CR 24, 66). This
amount was later supplemented (CR 228-29).
E.
The Court must sanction Castleman to prevent these types of cases in
the future (CR 24). Castleman asserts that, because OConnor had internet
access and could have used it to post his side of the story, he should not be
allowed to use the courts to avenge his hurt feelings. (CR 24-25). Therefore,
OConnor should have to pay Sum X (CR 25).
Castlemans motion does not appear to address OConnors assertions that the
ordering instructions had been modified.
C.

OConnors TCPA Dismissal Response

OConnor filed a response in opposition to the motion to dismiss (CR 67-222).

After an initial objection that Castlemans motion was untimely (CR 67), OConnor
argued TCPA should not apply pursuant to the commercial speech exemption

because Castleman was in the business of selling goods and services and he intended
the audience to be actual or potential buyers or customers (CR 68).
1. Prima Facie Case
OConnor then undertook to outline its prima facie case, referencing its
pleadings, responsive exhibit A (CR 96-108), the affidavit of OConnor, (CR 69-70,
87-90), exhibit B (CR 110-22), exhibit C (CR 124-25), and exhibit D (CR 127-31),
as to the false statements of fact purposed by Castleman.
OConnor referenced exhibits E through V concerning the defamatory
statements (CR 133-195).
The damages were evidenced by Castlemans own gloating and affected
potential customers, as set forth in Exhibits W (CR 197-200), X (CR 202) and Y
(CR 204), and by OConnors affidavit (CR 87-90).
2. Fact Issues to Affirmative Defense
OConnor then outlined a multitude of statements for which Castleman
offered no statement of defense (CR 73-77).
D.

Reply and Ruling

Castleman filed a reply alleging misstatements of fact and law (CR 223-227),

but attached no new evidence thereto.

The trial court ruled to allow consideration of the motion to dismiss despite
having been untimely filed (CR 230), and then denied the motion to dismiss and the
7

attorneys fees claims (CR 231-232). The trial court also entered findings of fact and
conclusions of law, which Castleman does not directly attack in his petition to this
Court (2CR 4-7).

Summary of the Argument

The trial courts denial of the motion to dismiss should be upheld for two
potential reasons. First, this matter should not be the subject of dismissal under
TCPA because it falls under the commercial exemption. Several Texas courts have
relied upon the language and analysis of the California anti-SLAPP statute to
determine a statement must be in furtherance of the stating partys business in order
for the commercial exemption to apply. However, a plain reading of the Texas statute
does not support such a requirement. Castlemans statements were against
OConnors business and in furtherance of his own endeavors, so they should be
included in the exemption.
If the Court determines the exemption does not apply, OConnors prima facie
case has been established by clear and specific evidence, so the matter withstands
the motion to dismiss. Castleman fails to show any defense by a preponderance of
the evidence, so the trial courts determination should be affirmed.
The motion to dismiss was only filed by Castleman, not CC, LLC, so any
claims against CC, LLC are not properly before this Court, and the attorneys fee
8

and sanctions issues are discretionary with the trial court and should be left to their
determination.

Argument
People demand freedom of speech as a compensation for the freedom of
thought which they seldom use.
Sren Kierkegaard

Freedom of speech, our very first amendment, often collides in its primacy
with the damages it can inflict. Injury from falsehood of statements has long been
recognized, but in our world of instant access to publication, our legislature saw fit
to clarify certain burdens and responsibilities through the Texas Citizens
Participation Act (TCPA). Tex. Civ. Prac. & Rem. Code Ann. 27.001 et seq.
(Lexis 2013). The implications of the TCPA are what brings this matter to the Court.
The TCPA involves a multistep process with shifting burdens and varying
burdens of proof, which this Court reviews de novo. Campbell v. Clark, 471 S.W.3d
615, 623 (Tex. App.Dallas, 2015, no pet.).
Step 1: The movant must show by a preponderance of the evidence that the
action is based on, relates to, or is in response to the partys exercise of the
right of free speech, petition, or association. TCPA 27.003, 27.005(b); In re
Lipsky, 460 S.W.3d 579, 586 (Tex. 2015). If the movant satisfies this prong,
the trial court must dismiss the action unless

Step 2: The party who brought the action must establish by clear and specific
evidence a prima facie case for each essential element of the claim in question.
TCPA 27.005(b), (c), Lipsky, 460 S.W.3d at 587.
Step 3: Notwithstanding the nonmovants proof of a prima facie case, the
court shall dismiss a legal action against the movant if the movant establishes
by a preponderance of the evidence each essential element of a valid defense
to the nonmovants claim. TCPA 27.005(d).
There are four exemptions from the application of the TCPA. TCPA
27.010(a)-(d). The commercial speech exemption provides that the TCPA does not
apply to a legal action brought against a person primarily engaged in the business
of selling or leasing goods or services, if the statement or conduct arises out of the
sale or lease of goods, [or] servicesor a commercial transaction in which the
intended audience is an actual or potential buyer or customer. TCPA 27.010(b);
Backes v. Misko, 486 S.W.3d 7, 21 (Tex.App.Dallas 2015, pet. denied). Proof of
the exemption is the burden of the nonmovant. Better Bus. Bureau of Metro. Dallas,
Inc., v. BHD FW, Inc., 402 S.W.3d 299, 309 (Tex.App.Dallas 2013, pet. denied).
Ultimately, [t]he TCPAs purpose is to identify and summarily dispose of
lawsuits designed only to chill First Amendment rights, not to dismiss meritorious
lawsuits. Lipsky, 460 S.W.3d at 589, referencing TCPA 27.002.

A. Exemption for Commercial Speech

The ruling of the Court does not specifically mention the basis for the denial
of the motion to dismiss (1CR 231-32), but Conclusion of Law No. 5 states,
10

Defendants acts fall within an exception to the Citizens Participation Act. Tex.
Civ. Prac. & Rem. Code 27.101 (b). There is a typographical error in the finding,
in that the seemingly proper statutory reference would be section 27.010(b). The
exemption states:
This chapter does not apply to a legal action brought against a person
primarily engaged in the business of selling or leasing goods or
services, if the statement or conduct arises out of the sale or lease of
goods, services, or an insurance product, insurance services, or a
commercial transaction in which the intended audience is an actual or
potential buyer or customer.
TCPA 27.010 (Lexis Advance, 2015).
Castleman is a person engaged in the business of selling goods, and the
statements he makes arise out of the sale of goods. OConnor is a person engaged in
services, and the statements Castleman makes arise out of his receipt of the services
to assist in the sale of his goods. (CR 10-11). There are no sworn statements that
Castleman does not, in fact, also provide or train individuals to provide services
similar to those provided by OConnor. Nonetheless, Castleman argues against the
applicability of this exemption because the statements were not made in an attempt
to win business for the speaker (Appellants Brief, p. 36-37).
The issue of application of commercial exemption appears to be an unsettled
are of the law in Texas. Castleman relies upon various intermediate courts of appeals,
none of which are binding precedential authority for this Court. However, the United
States Fifth Court of Appeals has also addressed this issue and applied a more plain
11

reading of the statute. This brief will first address the cases raised by Castleman,
which rely upon California precedent, and then turn to the opinions of courts who
are looking at this matter from a more literal reading of the planning meaning of the
words in the applicable statute than those argued by Castleman.
Cases cited for Castlemans exclusion from the commercial exemption:
Newspaper Holdings, Inc. v. Crazy Hotel Assisted Living, Ltd.,
Houston [1st Dist.] 2013
Newspaper Holdings involved, not surprisingly, a newspaper article, and the
First Court of Appeals looked to California law to determine the statements made
against Hotel did not arise out of the lease or sale of the goods or services that NHI
sellsnewspapers. Id., citing Simpson Strong-Tie Co., Inc. v. Gore, 49 Cal. 4th 12,
109 Cal. Rptr. 3d 329, 230 P.3d 1117 (Cal. 2010). However, as discussed further
below, there are differences between the language of the Texas and California AntiSLAPP statutes, and Castlemans statements did arise out of the sale of his goods
(CR 17-19, 133-95), so this case is not directly helpful and appears to be the basis
for certain Texas cases leaving the course of a literal reading of the exemption
statute.
Whisenhunt v. Lippincott, Texarkana 2015
The Texarkana Court considered an argument against the use of the
commercial speech exemption in Whisenhunt v. Lippincott, 474 S.W.3d 30, 42-43
(Tex.App.Texarkana 2015, no pet.) (cited in Appellants Brief at p. 36). Therein,
12

the trial court had dismissed claims for tortious interference with existing business
relationships and with prospective business relationships and for civil conspiracy but
maintained the claim for defamation. Both sides appealed. Id., at 34-35. The Sixth
Court considered the implications of the commercial speech exemption on the
dismissed matters but found it did not have jurisdiction to rule on the defamation
claim.
Factually, the court was making a determination as to whether Lippincott (the
administrator of FSS) and Parks (an administrator of AMH), were primarily engaged
in the business of selling or leasing goods or services. The court held they were
merely administrators, not engaged in the business of selling services. Id., at 42. The
court then went on to discuss that the business of selling administrative services was
different from the provision of anesthesiology services, so the statements could not
have been made for the purpose of securing sales in competition with Whisenhunt.
The court found deficiency because Whisenhunt does not explain how the
comments made about him or SafeNET arose out of the sale of Lippincotts or Parks
services or that the statements were made to their potential customers as opposed to
his potential customers. Id., at 43, citing Newspaper Holdings, 416 S.W.3d at 89;
Better Bus. Bureau of Metro. Dallas v. BH DFW, Inc. 402 S.W.3d 299, 309
(Tex.App.Dallas 2013, pet. denied).

13

Notably, this opinion has only been adopted in one other Texas opinion, that
being Moldovan v. Polito, also a Dallas opinion.

Backes v. Misko, Dallas 2015

Castleman also cites to Backes v. Misko, 486 S.W.3d 7, 21 (Tex.App.Dallas
2015, pet. denied) to support his argument the commercial exemption does not apply
(cited in Appellants Brief at p. 36). But in Backes, the courts determination turned
first on whether the defendants were primarily engaged in the business of selling or
leasing goods or services in the quarter horse business, which it determined was not
supported by the facts. The second determination, whether the posted statements
actually implicated the business, also resulted in a finding the evidence failed
because the posts made no reference to any alleged horse business or the sale of
any horses or horse related services. Id., *33-34.
Hicks v. Group & Pension Adminrs., Inc., Corpus Christi 2015
In Hicks v. Group & Pension Adminrs., Inc., 473 S.W.3d 518, 531
(Tex.App.Corpus Christi 2015, no pet.) (cited in Appellants Brief at p. 36), the
plaintiff alleged the lawyer defendants statements caused the city to back out of a
contract with him, but since the lawyer made the statement in the course of
representing the city and was not trying to get the city to hire him for the work, the
city was not a potential buyer or customer of his services, so the commercial
14

exemption was not applicable. In contrast, there is no finding here that Castleman
was not trying to get others to utilize his services or training in making these
statements about OConnor.
Schimmel v. McGregor, Houston [1st Dist.] 2014
Schimmel v. McGregor, 438 S.W.3d 847, 857-58 (Tex.App.Houston [1st
Dist.] 2014, pet. denied) (cited in Appellants Brief at p. 36), involved a group of
home owners seeking redress from an attorney representing another group of
homeowners for statements he made and actions he took in his representative
capacity. Id., at 850-51. The First Court of Appeals determined the ultimate intended
audience for the lawyers statements was the City of Galveston, that Schimmel did
not represent the City of Galveston, nor was the City a "potential buyer or customer"
of Schimmels legal services. Id., at 858.
Kinney v. BCG Atty. Search, Inc., Austin 2014
Kinney v. BCG Atty. Search, Inc., No. 03-12-00579-CV, 2014 WL 1432012,
2014 Tex. App. LEXIS 3998 (Tex.App.Austin April 11, 2014, pet. denied)
involved a former employee, Kinney, making anonymous complaints about BCG
after leaving his employment there and opening a competing business. BCG alleged
Kinney had signed a confidentiality provision in an employment agreement, but
Kinney alleged his signature was forged on the document. Id., at *3. BCG sued for
the defamatory statements, among other complaints, and Kinney filed a motion to
15

dismiss pursuant to TCPA section 27.003. Id., at *6. The Third Court of Appeals
followed the decisions of Newspaper Holdings and Better Bus. Bureau and required
the plaintiff to show that the statements arose from the sale of the defendants
services so that the exemption applied. Id., at 19. Because Kinneys statements were
made anonymously with no reference to his own business or sale of services, there
was no evidence that the post was for the purpose of obtaining approval for,
promoting, or securing sales or leases of, or commercial transactions in [his] goods
or services or in the course of delivering [his] goods or services. Id., at *20, citing
Newspaper Holdings416 S.W.3d at 88.
Cases supporting application of the commercial exemption:
Other courts, however, have not followed the California based logic.
NCDR, LLC v. Mauze & Bagby, PLLC, 5th Cir. 2014
NCDR, LLC v. Mauze & Bagby, PLLC, 745 F.3d 742, 753-755 (5th Cir. 2014)
was a Texas suit considered by the United States Court of Appeals for the Fifth
Circuit wherein a law firm engaged in an advertising campaign to solicit former
dental patients from a certain dental clinic. In the campaign, the firm ran television,
radio, and internet advertisements and developed a website alleging the clinics
performed unnecessary and harmful dental work on children to obtain government
reimbursements. Id., at 745. The clinic brought suit with claims that included
defamation. Id., at 745-46. The firm moved for dismissal under TCPA 27.003. The
16

district court determined the statements were not protected under the TCPA because
they were commercial speech. Id., at 746.
Finding that the Texas Supreme Court had yet to interpret the commercial
speech exemption, the court reviewed the Texas intermediate court decisions
addressed herein above that chose to apply Californias interpretation and burden of
proof requirements. The court determined the intermediate courts erred in adopting
Californias interpretation because the Texas statutory language did not state or
imply that the representations had to be about the persons or a competitors
business, so the underlying Simpson opinion was inapplicable. Id., at 755.
Therefore, because the advertisements were targeted at actual or potential customers,
the commercial exemption applied.
This logic is much more in keeping with this Courts role in applying the law,
not creating it, and should be the preferred analysis in this matter.
Miller Weisbrod, LLP v. Llamas-Soforo, El Paso 2014
Lawyer advertising and its implications within the commercial exemption
were the subject of consideration in Miller Weisbrod, LLP v. Llamas-Soforo, No.
08-12-00278-CV, 2014 Tex. App. LEXIS 12745, 2014 WL 6679122 (Tex.App.
El Paso Nov. 25, 2014, no pet.). The Eighth Court of Appeals adopted the analysis
of NCDR. Id. at *20-21.

17

A plain reading of the statute encompasses these statements within the

commercial exemption. However, if this Court determines to follow the California
line of cases and find the commercial speech exemption does not preclude
application of the TCPA, then the analysis continues with review of the burden
shifting analysis.

B. Shifting Burdens
1. Castlemans burden to establish OConnor sued him because he
exercised a protected right
Castleman sought dismissal of OConnors claims, alleging Castleman was
exercising the right of free speech (CR 20). The burden shifting analysis begins with
Castlemans requirement to show, by a preponderance of the evidence, that
OConnor sued him because he was exercising such a right. Vander-Plas v. May,
No. 07-15-00454-CV, 2016 Tex. App. LEXIS 10822 (Tex. App.Amarillo,
October 4, 2016, mem. op.), citing TCPA 27.005(b).
While OConnor disagrees the TCPA is applicable in this matter, OConnor
agrees this matter arises from an exercise of the right of free speech, which leads to
the second step of OConnors prima facie case.

18

2. OConnors prima facie case

If Castleman was exercising a protected right, then the burden shifts for
OConnor to show he has a prima facie case on his cause of action for defamation.
TCPA 27.055(c).
A prima facie case refers to evidence sufficient as a matter of law to
establish a given fact if it is not rebutted or contracted. Lipsky, 460 S.W.3d at 590.
Therefore, Castlemans evidence to the contrary is not considered in this analysis.
Clear and specific evidence of each essential element of a claim is more
than mere notice pleading, but this standard does not impose an elevated
evidentiary standard, does not categorically reject circumstantial evidence, and
does not impose a higher burden of proof than that required of the plaintiff at trial.
Lipsky, 460 S.W.3d at 590-91. The standard is met when the Plaintiff provides the
minimum quantum of evidence necessary to support a rational inference that the
allegation of fact is true for each essential element of the claim. Lipsky, 460 S.W.3d
at 590; see also D Magazine Partners, L.P. v. Rosenthal, 475 S.W.3d 470, 479
(Tex.App.Dallas 2015, pet. granted)(discussing burden of proof under Lipsky).
This burden is not higher than that required of a plaintiff at trial, where they
may prevail by offering sufficient evidence to support a finding of fact in its favor,
even if a defendant has offered conflicting evidence. Moldovan v. Polito, No. 0515-01052-CV, 2016 Tex. App. LEXIS 8283, *15 (Tex. App. Dallas Aug. 2, 2016);
19

citing United Servs. Auto Assn v. Croft, 175 S.W.3d 457, 463 (Tex.App.Dallas
2005, no pet.)
In a defamation case that implicates the TCPA, pleadings and evidence that
establishes the facts of when, where, and what was said, the defamatory nature of
the statements, and how they damaged the plaintiff should be sufficient to resist a
TCPA motion to dismiss. Lipsky, 460 S.W.3d at 591; see also Vander-Plas v. May,
No. 07-15-00454-CV, 2016 Tex. App. LEXIS 10822, *12-13 (Tex. App.
Amarillo, October 4, 2016, mem. op.); Moldovan, 2016 Tex. App. LEXIS 8283, *13;
Campbell, 471 S.W.3d at 624. Within this analysis, the court only considers the
pleadings and evidence in favor of the plaintiffs case. They do not consider
whether the defendant presented evidence rebutting the plaintiffs case; such
evidence is appropriate in determining a defendants motion for summary judgment
or at trial but not in determining whether the plaintiff presented a prima facie case.
Moldovan, 2016 Tex. App. LEXIS 8283, *15, citing Rosenthal, 475 S.W.3d at 48081.
OConnor must prove Castleman:
(1) published a false statement of fact to a third party;
(2) that was defamatory concerning OConnor;
(3) while acting with negligence regarding the truth of the
statement; and
(4) which caused damages, unless the statements were
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defamatory per se.

Moldovan, 2016 Tex. App. LEXIS 8283, *16; citing Campbell, 471 S.W.3d at 624.

(1) Castleman published a false statement of fact to a third party;

a. Publication
There is no questions Castleman published the statements to third parties (CR
133-95).
In this case, "when, where, and what was said" were the various electronic
postings themselves, still present on the internet through at least the date of the
hearing in the trial court. See, D Magazine Partners, L.P. v. Rosenthal, 475 S.W.3d
470, 481 (Tex. App.Dallas 2015).
b. Statement of False Fact
OConnor outlined the statements of concern in his pleadings (CR 12) and
described why the statements were false (CR 11-12). He also provided additional
documents and affidavits in response to the motion to dismiss further evidencing the
false nature of the statements (CR 87-90, 110-22, 124-25, 127-31).
Castleman claims opinion. Castleman asserts there were no false statements
of fact, but merely statements of opinion. Courts are to classify a statement as fact
or opinion based on the statements verifiability and the entire context in which the

21

statement was made. Am. Heritage Capital, LP v. Gonzalez, 436 S.W.3d 865, 875
(Tex. App.Dallas 2014, no pet.). This determination is a question of law. Id.
The following statements were identified by the trial court in the findings of
fact as defamatory (2CR 5). They are each factual:
a.

there was an 85% error rate in the orders placed.

An error rate is a verifiable fact, not an opinion. In his defense of truth of the
statement, Castleman even argues that actual error rate was 80% based upon his full
review (CR 27).
b.

No one from his company reviewed any of the orders to ensure they

were being done correctly.

This statement could have been verified by communication with OConnor.
The reality that it was not verified does not make this factual statement an opinion.
c.

zero quality control or checks to ensure work is being done correctly

Again, this statement could have been verified by communication with

OConnor. The reality that it was not verified does not make this factual statement
an opinion.
d.

confirming that Plaintiffs practically stole from Defendants.

Castleman alleged in his entries that OConnor owed him money for the
misentered orders and refused to pay it back. This is not an opinion, but an allegation
of facts by Castleman that could have been verified.
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e.

Plaintiff was someone that doesnt stand behind their work, their team

does no quality checks or assurances, and if theres ever a problem, theyre not going
to fix it for you, especially when it comes to financial.
This statement is merely a conglomeration of each of the above statements,
which are independently verifiable. The only new comment is that OConnor will
not fix problems, but this, too, could have been verified through inquiry with
OConnor as to the history of his customer service responses.
Castleman claims defense of truth. Castleman asserts his allegations, or at
least the gist of his allegations, are true (Appellant Brief, p. 33). His gist
evidence outlines as follows and does not rise to a level of establishing the statements
as a matter of law (Appellants Brief, p. 33) or a preponderance of the evidence
(TCPA 27.005(d)):
Allegation

Purported Evidence of
Truth
OConnors orders showed A full review showed an
an 85% error rate.
error rate of approximately
(Appellants Brief, p. 3380% (CR 27).
34)

No quality control or
review (Appellants Brief,
p. 34)

OConnor got only 20% of

the orders right and
described no reviews or
procedures. (CR 27)

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Problems with
Evidence
This statement is
from Castlemans
unsupported,
conclusory statement
in his self-serving
affidavit.
Also from
Castlemans
unsupported,
conclusory statement
in his self-serving
affidavit.

OConnor didnt stand

behind his word. (Id.)

OConnor wouldnt
reimburse the extra costs
that he imposed. (CR 5658).

Castlemans record
reference is to his
own blog post, an
unverified,
unsupported,
conclusory and selfserving statement.

OConnors evidence states that he followed the instructions of Castleman

(CR 69-70, 87-90, 96-108, 110-22, 124-25, 127-31). OConnor evidence is
sufficiently clear and specific to establish a prima facie case that at least part of the
postings gist was not true.

See Rosenthal, 475 S.W.3d at 484. Castlemans

evidence, however, falls woefully short of his burden of proof to claim a defense
resulting in dismissal.
Even if Castlemans allegations are true, the omission of the impact of the
faulty instructions led to Castleman publishing in such a way that he created a
substantially false and defamatory impression by omitting the issue of the
instructions and juxtaposing the facts in a misleading way. Turner v. KTRK
Television, Inc., 38 S.W.3d 103, 115 (Tex. 2000).

(2) Castlemans statements were defamatory concerning OConnor;

A statement is defamatory if it tends to injure a persons reputation and
thereby expose the person to public hatred, contempt, ridicule, or financial injury or
24

to impeach a persons honesty, integrity, virtue, or reputation. Moldovan, 2016 Tex.

App. LEXIS 8283, 18, citing Tex. Disposal Sys. Landfill, Inc. v. Waste Mgmt
Holdings, Inc., 219 S.W.3d 563, 580 (Tex.App.Austin 2007, pet. denied), citing
Tex. Civ. Prac. & Rem. Code Ann. 73.001 (West 2005).
Statements are considered defamatory per se if they are so obviously hurtful
to the person aggrieved that they require no proof of their injurious character to make
them actionable. Moldovan, 2016 Tex. App. LEXIS 8283, *18, citing Morrill v.
Cisek, 226 S.W.3d 545, 549 (Tex. App.Houston [1st Dist.] 2006, no pet.). Among
other qualifications, a false statement will typically be classified as defamatory per
se if it injures a person in his office, profession, occupation [or] charges a person
with the commission of a crime. Moldovan, 2016 Tex. App. LEXIS 8283, *18-19.
OConnor offered clear and specific evidence of statements by Castleman that
were defamatory per se. The statements criticize OConnors skills and business
acumen and also assert he is dishonest. See Restatement (Second) of Torts 573
cmt. C (1977) (quoted in Hancock v. Variyam, 400 S.W.3d 59, 66-67 (Tex. 2013)).
Statements concerning merchants that question their solvency or honesty in
business come within the rule stated in this Section [i.e., defamation per se], as do
statements charging any other quality that would have a direct tendency to alienate
custom. See Restatement (Second) of Torts 573 cmt. C (1977) (quoted in
Hancock, 400 S.W.3d at 66-67).
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Each and every statement identified in the Findings of Fact involves

OConnors office, profession, or occupation, and the practically stole comment
aligns closely with the commission of a crime. See Tex. Disposal Sys. Landfill,
Inc., 219 S.W.3d at 581. These statements are not merely attacks on OConnors
general reputation. The statements accuse OConnor of deplorable business practices
such as an 85% error rate, failure to review orders for accuracy, no quality control,
and failure to acknowledge and address customer complaints (2CR 5). These
statements directly attack the business and OConnor as a businessman. The
statements were clearly and specifically shown to be defamatory and defamatory per
se.

(3) Castleman acted with negligence regarding the truth of the statement;
"Negligent conduct is determined by asking 'whether the defendant acted
reasonably in checking the truth or falsity or defamatory character of the
communication before publishing it.'" Scripps Tex. Newspapers, L.P. v. Belalcazar,
99 S.W.3d 829, 840 (Tex. App.Corpus Christi 2003, pet. denied) (quoting
Restatement (Second) of Torts 580B cmt. g).
OConnor offered clear and specific evidence that Castleman acted with
negligence regarding the truth of the statements. OConnor offered evidence that
Castleman explained to OConnor the procedure for ordering proper quantities and
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that OConnor followed the instructions. OConnor presented evidence of additional

conversations which supported OConnors application of the instructions as well as
his attempt to discuss the alleged misapplication of the instructions with Castleman.
When made aware of the allegations, OConnor attempted to communicate with
Castleman about the issue, but Castleman was more interested in his campaign of
negativity than solution. (CR 69-70, 87-90, 96-108, 110-22, 124-25, 127-31).

(4) Castlemans statements were defamatory per se, but they also caused
damage.
As set forth above, the statements were defamatory per se, negating
OConnors burden to show damages. Tex. Disposal Sys. Landfill, Inc., 219 S.W.3d
at 580. However, if this Court determines a showing of damages is necessary, both
OConnor and Castleman provided evidence of damage.
General damages include losses such as loss of reputation or mental anguish.
Lipsky, 460 S.W.3d at 593. Both individuals and corporations may suffer reputation
damages that are noneconomic in nature. See Waste Mgmt. of Texas, Inc. v. Tex.
Disposal Sys. Landfill, Inc., 434 S.W.3d 142, 146 (Tex. 2014).
The damages were evidenced by Castlemans own gloating as set forth in
Exhibits W (CR 197-200), X (CR 202) and Y (CR 204), and by OConnors affidavit
(CR 87-90).

27

OConnor offered at least a minimum quantum of clear and specific evidence

necessary to support a rational inference that [his] allegations of fact are true on each
element of [his] defamation claims. Moldovan, 2016 Tex. App. LEXIS 8283, *37,
citing Lipsky, 460 S.W.3d at 592-93.

C.

Only Castleman, Individually, Moved to Dismiss.

Castleman, individually, filed an untimely motion to dismiss under the TCPA

(CR 16-66), alleging his statements were not defamatory and that they do not fall
within an exception to the TCPA (CR 16). The motion only requests relief for
Castleman, requesting relief for him for his costs, fees, and expenses and for
all other relief to which he may be entitled (CR 16, 25). The only reference to
Castleman being collective to include CC, LLC, is in the statement of facts (CR 17).
As such, CC, LLC is without standing to even assert relief under this appeal.

D.

Attorneys Fees and Expenses

Castlemans claims for attorneys fees fail because he did not and cannot

prevail in his motion for dismissal.

If the Court determines Castlemans motion for dismissal should be granted,
that does not necessarily mean fees and expense are mandated. At least one court
has determined that, while the introductory language of subsection (a) of section
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27.009 uses the seemingly mandatory term "shall award," the subsequent language
tempers the conditions for making an award with discretionary terms like justice
and equity and sufficient to deter. TCPA 27.009(b). Thereby, a trial court
may decide that justice and equity do not require that costs, fees, or expenses be
awarded and may determine that no sanctions are needed to deter the plaintiff from
bringing similar actions. These provisions do not mandate an award. Combined
Law Enf't Ass'n v. Sheffield, No. 03-13-00105-CV, 2014 Tex. App. LEXIS 1098,
2014 WL 411672, at *30-31 (Tex. App.Austin Jan. 31, 2014, pet. filed) (mem.
op.).

Prayer
For these reasons, Appellees pray the Court affirm the order of the trial court
denying OConnors motion to dismiss pursuant to the TCPA and deny all additional
relief requested by Appellees.

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Respectfully submitted,
FIELD, MANNING, STONE,
HAWTHORNE & AYCOCK, P.C.
A Professional Corporation
2112 Indiana Avenue
Lubbock, Texas 79410
806-792-0810 (Telephone)
806-792-9148 (Facsimile)
By: /s/Anna McKim
Anna McKim
State Bar No. 24033381
J. Paul Manning
State Bar No. 24002521
Attorneys for Appellants

Certificate of Compliance
I certify that this document was produced on a computer using Microsoft Word and
contains 5900 words, as determined by the computer softwares word count
function, excluding the sections of the document listed in the Texas Rule of
Appellate Procedure 9.4.
/s/Anna McKim
Anna McKim

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Certificate of Service
This certifies that on the 30th day of November, 2016, the undersigned served
this Reply Brief on the following:
THE OLSON FIRM, PLLC
Leif A. Olson
4830 Wilson Road, Ste. 300
Humble, Texas 77396
THE LAW OFFICE OF JARED B. HALL, PLLC
Jared B. Hall
P.O. Box 6982
Lubbock, Texas 79493
/s/Anna McKim
Anna McKim

31