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Urban Engineering v. Salinas Construction Technologies, Ltd.

Court of Appeals of Texas, Thirteenth District, Corpus Christi-Edinburg

May 25, 2017


         On appeal from the 117th District Court of Nueces County, Texas.

          Before Chief Justice Valdez and Justices Rodriguez and Hinojosa



         Appellee Salinas Construction Technologies, Ltd. (Salinas) filed suit against appellants Urban Engineering and Murray F. Hudson P.E. (collectively Urban) alleging causes of action for defamation and business disparagement. Urban filed motions to dismiss under the Texas Citizens Participation Act[1] (TCPA), see Tex. Civ. Prac. & Rem. Code Ann. ch. 27 (West, Westlaw through 2015 R.S.), and chapter 150 of the Texas Civil Practice and Remedies Code. See id. ch. 150 (West, Westlaw through 2015 R.S.). Urban brings this interlocutory appeal from the trial court's denial of both motions. See Tex. Civ. Prac. & Rem. Code Ann. §§ 51.014(a)(12), 150.002(f) (West, Westlaw through 2015 R.S.).

         By two issues, Urban argues: (1) the trial court erred in denying its TCPA motion to dismiss because Salinas failed to present clear and specific evidence establishing a prima facie case for its claims and because Urban established the qualified-privilege defense by a preponderance of the evidence; and (2) the trial court abused its discretion in denying Urban's chapter 150 motion to dismiss because Salinas's certificate of merit does not support a business-disparagement claim. We reverse and remand.

         I. Background

         The pleadings and evidence pertinent to the motions to dismiss reflect the following:

         A. Salinas Submits Bid for Road Project

         Urban was retained by the City of Corpus Christi (Corpus Christi or the City) to serve as the engineer on a public-construction project to repair Waldron Road. As part of its duties under the contract, Urban was required to "analyze bids, evaluate, prepare bid tabulation, and make recommendations concerning award of the contract." Potential bidders for the project were required to provide a "Statement of Experience." The City notified bidders that it would assess whether they were "responsible" based on interviews with references and consideration of the bidder's past projects. The City also instructed bidders that "[b]y listing reference contact information, [the bidder] indicates its approval . . . to contact the individuals listed as a reference."

         Of the four companies who submitted bids for the project, Salinas submitted the lowest bid. Salinas's bid was accompanied by the required "Statement of Experience" which set out information on construction projects completed within the last five years as well as all past projects completed with Corpus Christi. Salinas also provided that it was in current litigation with the City of Seguin.

         B. Urban's Recommendation

         By letter dated March 5, 2015, Urban recommended to Corpus Christi that the City not award the project to Salinas based on the following:

1. Demonstrated lack of performance in maintaining schedule on an ongoing project with the City of Corpus Christi and others.
2. Non-performance and current disbarred status with another municipality due to current litigation.
3. Lack of experience with proposed construction techniques.

         Urban informed the City that Salinas's current projects with Corpus Christi and the Texas Department of Transportation (TxDOT) were behind schedule. Urban also stated that Salinas "does not have or has not committed the necessary resources to put the projects back on schedule." Urban informed the City that another municipality was forced to file a "failure to perform" complaint with the bonding company and that the "project was currently in [l]itigation." Urban stated that the last project completed by Salinas for the City was completed behind schedule. Urban also represented that multiple projects with TxDOT were completed behind schedule. Finally, Urban stated that Salinas "does not have [the] demonstrated resources or capacity to accomplish required work within mandated schedules nor does it have requisite experience working with and in the materials particular to this project location and design." Urban ultimately recommended that the City award the contract to the second-lowest bidder.

         In response to Urban's March 5 letter, Salinas's attorney sent correspondence to the City alleging that Urban's letter was "misleading, inaccurate, or false, as it relates to Salinas[.]" Salinas disputed that it had a "demonstrated lack of performance in maintaining schedule on an on-going project with the City of Corpus Christi." Salinas explained that the project was behind schedule because of "several City utility conflicts." Salinas also stated that another project with the City was extended from 210 to 645 days as a result of the City's change orders for additional work.

         Salinas maintained that the allegation it was in "disbarred status"[2] with another municipality was inaccurate. Salinas explained that it was in litigation with the City of Seguin because it had completed work but had not received payment. Salinas disputed that the suit was filed for "non-performance."

         Finally, Salinas maintained that Urban's statement that it lacked "experience with proposed construction techniques" was false. Salinas asserted that it had completed projects within a close proximity to the Waldron Road ...

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