For FBFK attorneys J. Beverly and Kenneth Holt, who recently secured an appellate win for their client in a case of first impression interpreting the requirements for motions to dismiss under the Texas Citizens Participation Act (“TCPA”), the legal lesson is clear: All grounds for seeking dismissal under the TCPA – including any affirmative defenses or other grounds for dismissal – should be made in the initial motion.
The case holds that when moving to dismiss a case under the TCPA, a defendant must set out all the possible reasons for dismissal – including any affirmative defenses – within the 60-day deadline for filing such motions. A defendant cannot wait until after the plaintiff files a response to file a reply asserting affirmative defenses if that reply is filed after the 60-day deadline. But the case also calls into question whether a reply is even allowed under TCPA procedure.
Quick Understanding of the TCPA
The TCPA was enacted in 2011 to protect the First Amendment rights of Texas citizens. It provides that when a party files an action which infringes upon certain constitutional rights of another party, that second party may move to seek an early dismissal of the action in certain circumstances. The TCPA covers a broad range of conduct and has been used thousands of times by defendants seeking a quick dismissal of claims made against them.
The Case: TCPA & Parking Rights
The underlying dispute involved parking rights in a shopping center. FBFK’s client and the defendants owned separate tracts in a shopping center that were governed by a reciprocal parking and access easement. By written agreement, each property owner gave the other owners a reciprocal easement establishing that all property owners and their tenants had the right to use the parking areas on each other’s tracts. The easement agreement allowed each property owner to designate specific spaces for their own use based on the need to do so.
However, when FBFK’s client wanted to construct a new building on their property, trouble ensued. The other property owners recorded “parking designations” in the public records, which cut off the client’s right to use the other owners’ parking areas by designating all spaces on their properties for their exclusive use.
FBFK’s client sued seeking to quiet title, arguing that the recorded parking designations were a cloud on its title because its rights under the reciprocal parking easement agreement had been effectively eliminated by the other property owners.
The TCPA provides that a defendant may seek early dismissal of a case if it can establish that the claims asserted against it involve protected rights of free speech or association or the right to petition the government. The defendant must file a motion to dismiss the claims within 60 days after being served. The plaintiff must then provide clear and specific evidence supporting its claims. If the plaintiff can satisfy that burden, the defendant may still get the case dismissed by asserting other grounds for dismissal – including affirmative defenses.
A Case of First Impression Under the TCPA
In this case, the defendants filed a timely motion to dismiss under the TCPA claiming that recording the parking designations was an exercise of their right to petition and to free speech. But in their initial motion, the defendants failed to argue that FBFK’s client’s claims were barred by the affirmative defense of limitations. FBFK’s client responded setting out proof of its action to quiet title. Only after the client’s response, defendants replied arguing that FBFK’s client’s claims were barred by the statute of limitations. Critically, the defendants’ reply raising this issue for the first time was filed more than 60 days after FBFK’s client had been served.
At the trial level, the defendants’ motion to dismiss was overruled by operation of law because the court did not rule on it within the required time period. The defendants appealed making the same arguments for dismissal.
The Fourteenth Court of Appeals in Houston affirmed the denial of the motion to dismiss. The Court assumed without deciding the recording of the parking designations was covered by the TCPA. But based on the evidence marshalled by FBFK’s attorneys, the Court concluded that FBFK’s client had met its burden under the TCPA to produce clear and specific evidence supporting each element of its claim to quiet title.
However, that did not end the inquiry. As noted, in their reply filed after the 60-day deadline, the defendants asserted for the first time that the claims were barred by the statute of limitations. FBFK’s attorneys argued that because the defendants only asserted this defense after the 60-day deadline to file a motion to dismiss it was not timely asserted under the TCPA and could not be considered.
In a case of first impression, the Court agreed with FBFK’s argument – holding that a defendant must assert any affirmative defenses to the plaintiff’s claims within the 60-day deadline set out in the TCPA. In practice, most plaintiffs file their response after the 60-day deadline because they are only required to respond no later than 7 days before the date set for the hearing. This creates a potential trap for defendants who wait to assert an affirmative defense as grounds for dismissal in a reply. But the Court also noted that the TCPA does not contain any provision regarding the filing or consideration of a reply. Rather, “the trial court must rule ‘on a motion under Section 27.003’ – not a motion in conjunction with a reply.” This calls into question whether a defendant can rely on even a timely filed reply in seeking dismissal.
The Bottom Line
This case establishes that if the plaintiff waits until after the 60-day deadline to respond and the defendant has not previously asserted that the case should be dismissed based on an affirmative defense, a court will not hear that argument. Practitioners should take note and be sure to include affirmative defenses in their initial motion to dismiss or risk waiving those arguments.
The case is Edry-TX-II, GP, et al v. CCND-Main St Shopping Center, LP, No. 14-22-00826-CV, 2023 WL 5111061 (Tex. App.–Houston [14th Dist.] August 10, 2023).