The Dallas Court of Appeals recently reversed a trial court’s decision to grant a motion to dismiss under the previous version of Texas’s anti-SLAPP statute the Texas Citizens Participation Act (TCPA). BusPatrol Am., LLC v. Am. Traffic Sols., Inc., 05-18-00920-CV, 2020 WL 1430357 (Tex. App.—Dallas Mar. 24, 2020, no pet.). The case revolved around a commercial dispute between two companies competing in the “smart bus technology market.”

The plaintiff-appellant in this case, BusPatrol America, LLC (BusPatrol), purchased the “BusStop Technology” from Force Multiplier Solutions, Inc. (FMS) in September 2017. The technology consisted of camera systems to monitor the interior and exterior of the bus and onboard computers to transmit the video data to school districts and law enforcement. On February 28, 2014 FMS entered into an Asset Purchase Agreement, a Technology License Agreement, and a Services Agreement with Dallas County Schools (DCS), a county school district. Through these agreements DCS received the exclusive right to license the BusStop Technology to school districts in Texas.

Dallas County voters eventually voted to dissolve DCS in November 2017. Still, from late 2016 to July 2017, DCS sought a buyer for its licensed products, including the BusStop Technology. DCS reached out to American Traffic Solutions, Inc. (ATS), the defendant-appellee in this case, as a potential buyer and provided ATS with access to the BusStop Technology during their discussions. Then in February 2018, the Dissolution Committee, overseeing the winddown of DCS, sought proposals for the purchase of all assets and any contractual interest that DCS had in the Stop Arm Camera Program located outside of Dallas County. ATS responded to the bid and submitted a proposal to purchase these assets.

BusPatrol filed suit against ATS, alleging that “its trade secrets and proprietary information were improperly solicited by, disclosed to, and used by . . . ATS.” ATS filed a motion to dismiss under the TCPA, which the trial court granted based on the claim’s relation to ATS’s right to free speech. BusPatrol appealed and ATS filed a notice of interlocutory cross-appeal.

The court ultimately determined that BusPatrol’s claims were not based on, related to, or in response to ATS’s exercise of protected rights. Regarding the right to free speech, the court noted that an exercise of this right under the TCPA must relate to some matter of public concern. The court found that even though the underlying technology benefits the public through protecting children, the actual communication at issue involved only private actors for private financial gain. Consequently, ATS failed to establish that BusPatrol’s claims related to its right of free speech.

Regarding the rights of association and petition, the court noted that the trial court correctly determined that BusPatrol’s legal action did not implicate these rights and that ATS waived those issues on appeal. The right of association required some public or citizen participation under the TCPA, while the right of petition, under the Texas Constitution, must involve some governmental or public proceeding. Because ATS’s actions involved only private parties and sought only private financial gain, the court determined that ATS failed to establish that either its right of association or its right of petition were implicated by BusPatrol’s suit.

Special thanks to Kyle Markwardt for his assistance with this blog post.