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Lang v. Knowles

Court of Appeals of Texas, First District

August 29, 2019

SHANNON LANG, Appellant
v.
MATHEW KNOWLES AND MUSIC WORLD PROPERTIES, LLC A/K/A MW PROPERTIES, LLC, Appellees

          On Appeal from the 157th District Court Harris County, Texas Trial Court Case No. 2017-20160

          Panel consists of Chief Justice Radack and Justices Goodman and Countiss.

          MEMORANDUM OPINION

          JULIE COUNTISS, JUSTICE

         In this interlocutory appeal, [1] appellant, Shannon Lang, challenges the trial court's denial, in part, of her motion to dismiss the counter- and cross-claims of appellees, Matthew Knowles ("Knowles") and Music World Properties, LLC, also known as MW Properties, LLC ("Music World"), pursuant to the Texas Citizens Participation Act ("TCPA").[2] In her sole issue, Lang contends that the trial court erred in partially denying her motion to dismiss.

         We affirm.

         Background

         In its original petition, Lang Ferrer, PLLC (the "Law Firm") alleged that it entered into a written contract to provide legal representation to Knowles and Music World pursuant to which they agreed to pay the Law Firm for the legal services it provided. The Law Firm alleged that, despite it having "fully performed all conditions, covenants and promises" to Knowles and Music World, Knowles and Music World had "not paid for the legal services they received" in the amount of $49, 120.35.

         The Law Firm brought claims against Knowles and Music World for breach of contract, suit on account, fraud, fraudulent inducement, unjust enrichment, quantum meruit, promissory estoppel, and for violations of the Texas Uniform Fraudulent Transfer Act[3] and the Texas Theft Liability Act.[4] The Law Firm sought "actual damages in an amount no less than" $49, 120.35, "[p]unitive damages as allowed by law," "[a]n award of . . . reasonable and necessary attorney's fees," "costs of suit," "[p]re- and post-judgment interest," and "[s]uch other and further relief, at law or in equity, to which [i]t may be justly entitled." The petition was signed by Justin W. R. Renshaw as "Counsel for Plaintiff, [the Law Firm]."

         The Law Firm attached to its petition, and incorporated by reference, a demand letter sent on its behalf by its attorney to Knowles and Music World "threatening to sue" (the "Demand Letter"). The Demand Letter provides, in part, as follows:

We represent [the Law Firm] with respect to the referenced matter. This letter is notice of [the Law Firm's] claim and attempt to resolve this matter without litigation.
On November 2, 2016, you executed a written contract with [the Law Firm]. Under the terms of the contract [the Law Firm] promised to provide you and Music World . . . legal representation and you promised to pay for these services. A copy of the contract is attached for your ready reference.
. . . .
It has come to our attention that you are hosting a silent auction this Super Bowl weekend in Houston, which includes music memorabilia and other items from your management of your daughter, Beyoncé [Knowles-Carter], the group Destiny's Child etc. Presumably you are liquidating these items to pay debts, including the amount due to [the Law Firm]. To the extent you may be disposing of these and other assets to avoid your debts and legal obligations, however, we will consider the sale of such items to be fraudulent transfers and will seek all available remedies for same in the event [the Law Firm's] invoices are not paid as demanded.

         Knowles and Music World filed their First Amended Answer, Counterclaim and Cross Claim, generally denying the allegations and asserting "specific and affirmative denials/defenses." Additionally, Knowles and Music World brought counterclaims against the Law Firm and cross-claims against "Shannon Lang, individually, and Ada Ferrer, individually," as attorneys who worked for the Law Firm. They alleged that, "[b]ecause both Lang and Ferrer, individually[, ] were the attorneys in the [Law Firm] that represented" Knowles and Music World, Lang and Ferrer were subject "to personal legal liability for the misconduct and . . . negligence [that] they performed."

         More specifically, Knowles and Music World brought claims, jointly against the Law Firm, Lang, and Ferrer, for unfair debt collection practices, legal malpractice, [5] breach of fiduciary duty and the duties of loyalty and truthfulness, and breach of contract. Knowles and Music World also provided notice to the Law Firm, Lang, and Ferrer that "they intend[ed]" to seek damages for the "false and defamatory claim that . . . Knowles sold at auction memorabilia of Destiny's Child and of his famous daughter to avoid paying his creditors" pursuant to "Rule 13 and Chapter 10, Tex. Civ. Prac. Rem. Code."

         With respect to their unfair-debt-collection-practices claim, Knowles and Music World alleged that, in connection with their "efforts to collect inflated legal invoices," the Law Firm, Lang, and Ferrer "engaged in flagrantly false and defamatory debt collection practices without any legal or factual justification." The false and defamatory practices alleged included the Law Firm, Lang, and Ferrer "falsely publish[ing] the claim[s] in th[e] lawsuit, as well as in a letter prior to filing suit, that . . . Knowles sold at auction memorabilia of Destiny's Child and/or his famous daughter Beyoncé [Knowles-Carter] to fraudulently avoid paying his creditors." Knowles and Music World alleged that the claim was "a complete lie that was used by" the Law Firm, Lang, and Ferrer "without any factual support and in direct violation of the . . . [Texas Unfair] Debt Collection Practices Act[], as well as Rule 13[ of the Texas Rules of Civil Procedure], and Chapter 10" of the Texas Civil Practices and Remedies Code.

         With respect to their legal-malpractice claim, Knowles and Music World alleged that the Law Firm, Lang, and Ferrer "engaged in legal negligence and did not perform the reasonable [and] necessary legal research before recommending" that Knowles and Music World "enter into a settlement" in a previous matter "that would have advantaged and/or exonerated" them "in negotiating the settlement with the parties." They further allege that the Law Firm, Lang, and Ferrer also "breached" their "confidential information by allowing non-clients to participate in conflicting and private settlement negotiations," failed to reasonably advise them "before recommending [that] they accept and be bound by the settlement agreement in" the previous matter, and that "the settlement created personal liabilities for . . . Knowles, individually, that should not have been recommended by" the Law Firm, Lang, and Ferrer.

         With respect to their claim for breach of fiduciary duty and of the duties of loyalty and truthfulness, Knowles and Music World alleged that The Law Firm, Lang, and Ferrer breached their fiduciary duty and their duties of loyalty and "commitment to truthfulness" to Knowles and Music World "in both the prior representation as well as in the present alleged debt collection suit in at least the following non-exclusive" ways:

• Failing to advise [Knowles and Music World] about available and applicable legal defenses and excuses against the claims of the plaintiffs in the [previous matter];
• Failing to research and develop material facts to excuse [Knowles and Music World's] conduct in the [previous matter];
• Charging excessive fees for unreasonable legal ...

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