O'Gara v. Binkley

Decision Date24 April 2019
Docket NumberCIVIL ACTION NO. 3:18-CV-2603-B
Citation384 F.Supp.3d 674
Parties Todd O'GARA and Wanu Water Inc., Plaintiffs, v. Joseph P. BINKLEY III, Defendant.
CourtU.S. District Court — Northern District of Texas

Allyson L. Johnson, Seyfarth Shaw LLP, Dallas, TX, Andrew T. Stark, William L. Prickett, Pro Hac Vice, Seyfarth Shaw LLP, Boston, MA, Jonah R. Hecht, Pro Hac Vice, Seyfarth Shaw LLP, New York, NY, Suzanna C. Bonham, Seyfarth Shaw LLP, Houston, TX, for Plaintiffs.

Joel E. Geary, Grant B. Stock, James M. Welch, Vincent Serafino Geary Waddell Jenevein, PC, Dallas, TX, for Defendant.



Plaintiffs Todd O'Gara, founder, president, and chairman of Wanu Water Inc., and Wanu Water bring suit against a company investor, Defendant Joseph P. Binkley III, based on his involvement in an alleged orchestrated campaign to harass and damage Plaintiffs' reputations. The alleged campaign took the form of several emails in which Binkley and other investors/directors questioned O'Gara's academic credentials and ability to lead the company, all in an alleged attempt to undermine other directors' and stockholders' confidence in the company and induce breaches of contract. Binkley seeks dismissal of this suit under the Texas Citizens Participation Act (TCPA) and Federal Rule of Civil Procedure 12(b)(6) arguing that the Complaint violates his rights of association and free speech and that O'Gara and Wanu Water fail to state any plausible claims for relief. Having been fully briefed, the Court finds that the TCPA does not apply in federal court, and thus, declines to grant Defendant's Motion to Dismiss pursuant to the TCPA. However, as discussed below, the Court GRANTS Defendant's Motion to Dismiss (Doc. 8) under Rule 12(b)(6).


This dispute involves a series of allegedly defamatory emails and interactions between investors2 of Wanu Water and the founder and president of the company, O'Gara. In 2010, O'Gara founded Wanu Water (formerly known as FLUROwater). Doc. 1, Compl., ¶ 7. The company is a Delaware corporation, based in California, and creates and sells nutrient-infused water. Id. ¶ 2. Binkley is a Texas investor in Wanu Water and as of July 2018, he owned a 0.13% share of the company's outstanding equity. Id. ¶ 3.

Discussed in more detail below, the events giving rise to this lawsuit began in August 2018, when Binkley and other investors began emailing O'Gara, his legal counsel, and other investors regarding O'Gara's purported academic credentials and management concerns they had. Id. ¶¶ 26–68. Based on this conduct, Plaintiffs filed suit against Binkley on September 28, 2018, invoking this Court's diversity jurisdiction. Id. ¶ 4. Although all the claims are brought under California law and based on the same alleged conduct, the claims are brought by O'Gara individually, Wanu Water individually, or by both Plaintiffs jointly. Specifically, O'Gara brings his own claims for tortious interference with business relations, id. ¶¶ 69–76; tortious interference with contract, id. ¶¶ 77–84; and libel, id. ¶¶ 85–91. Wanu Water brings its own claim for libel. Id. ¶¶ 100–08. And both Plaintiffs bring claims for civil conspiracy, id. ¶¶ 92–99; and unfair and/or unlawful business practices in violation of California's unfair competition laws, id. ¶¶ 109–13.

On November 5, 2018, Binkley filed this Motion to Dismiss under the Texas Citizens Participation Act (TCPA) and Federal Rule of Civil Procedure 12(b)(6) arguing that the Complaint violates his rights of association and free speech and that Plaintiffs otherwise fail to state any plausible claims for relief. See generally Doc. 8, Mot. to Dismiss. Plaintiffs filed their Response (Doc. 20) to Binkley's Motion, and Binkley filed his Reply (Doc. 25). Binkley's Motion is therefore ripe for the Court's review.


Binkley first seeks dismissal of this suit arguing that Plaintiffs' Complaint is a violation of his rights of association and free speech, and thus, is subject to dismissal under the TCPA, also known as an anti-SLAPP statute. Doc. 8, Def.'s Mot. to Dismiss, 2; see also Serafine v. Blunt , 466 S.W.3d 352, 356 (Tex. App.—Austin 2015, no pet.) ("SLAPP is an acronym for ‘Strategic Lawsuits Against Public Participation’ "). Plaintiffs argue that the TCPA does not apply in federal court because it is procedural, and alternatively, even if it were substantive, it would not apply because it conflicts with federal procedural rules. Doc. 20, Pls.' Resp., 5–9.

A. Which Anti-SLAPP Statute Governs—Texas or California?

Before the Court can discuss any potential anti-SLAPP statute applicability in this case, the Court must first determine which statute to consider—Texas or California—because they differ in their reach and application. See Diamond Ranch Acad., Inc. v. Filer , 117 F. Supp. 3d 1313, 1320 (D. Utah 2015) ("court[s] only engage in a choice of law analysis if a true conflict exists between the two state laws.").3 Although the parties agree, for purposes of this motion to dismiss, that California state law governs Plaintiffs' causes of action discussed below, they dispute whether Texas's or California's anti-SLAPP statute applies. Binkley argues that Texas's anti-SLAPP statute should apply since that is where he resides and allegedly made these statements. Doc. 8, Def.'s Mot. to Dismiss, 8. Plaintiffs counter that California's anti-SLAPP statute should apply because even if Binkley made the statements in Texas—which they argue is unclear since his email signature lists a Nashville, Tennessee area code—Binkley cannot overcome the Restatement's presumption in favor of applying the law of a plaintiff's domicile—here, California. Doc. 20, Pls.' Resp., 10–11 & n.6.

"District courts sitting in diversity apply the choice-of-law rules of the forum state." Smith v. EMC Corp. , 393 F.3d 590, 597 (5th Cir. 2004). Texas uses the "most significant relationship" test provided by the Restatement (Second) of Conflict of Laws for all choice-of-law cases except contract cases in which the parties have agreed to a valid choice of law clause or where there is a statutory directive. Duncan v. Cessna Aircraft Co. , 665 S.W.2d 414, 420–21 (Tex. 1984) ; Restatement (Second) of Conflict of Laws §§ 6, 145 (1971) [hereinafter "Restatement"].4 And more specifically, when conducting a choice-of-law analysis regarding a tort claim, Texas courts look to § 145 of the Restatement. TV–3, Inc. v. Royal Ins. Co. of Am. , 28 F. Supp. 2d 407, 419–20 (E.D. Tex. 1998). The factors to be considered under Restatement § 145 include: "(a) the place where the injury occurred; (b) the place where the conduct causing the injury occurred; (c) the domicile, residence, nationality, place of incorporation and place of business of the parties; and (d) the place where the relationship, if any, between the parties is centered." Restatement § 145(2). Section 145 further provides that these factors are to be considered "according to their relative importance with respect to the particular issue." Id.

Plaintiffs argue that because the Restatement requires the defamation laws of a plaintiff's domicile and place of injury (in this case, California)to generally apply, irrespective of where the defamatory statements were made, California's anti-SLAPP statute should be applied. Doc. 20, Pls.' Resp., 9. However, the fact that California law governs Plaintiffs' substantive claims—e.g. , defamation—is not dispositive on this issue since laws from different states can apply to different claims. See Chi v. Loyola Univ. Med. Ctr. , 787 F. Supp. 2d 797, 803 (N.D. Ill. 2011) (applying Arizona law to plaintiff's defamation claim but applying Illinois's anti-SLAPP statute); see also Spence v. Glock, Ges.m.b.H. , 227 F.3d 308, 311 n.6 (5th Cir. 2000) (noting that Texas courts are required to undertake an "issue by issue" choice-of-law analysis). This is because the "issue of whether a statement is defamatory ... is distinct from the issue of whether the statement is privileged" by a state's anti-SLAPP statute. Chi , 787 F. Supp. 2d at 803 (quoting Global Relief Found. v. N.Y. Times Co. , 2002 WL 31045394, at *10 (N.D. Ill. Sept. 11, 2002) ).

Instead, in the anti-SLAPP context, courts typically consider the place where the allegedly tortious conduct occurred and the speaker's domicile in determining what state's law to apply.5 This is because the primary purpose behind a state’s anti-SLAPP statute is to encourage and safeguard its citizens' constitutional rights. See, e.g. , Tex. Civ. Prac. & Rem. Code § 27.002. Although it is unclear whether or not Binkley in fact made these allegedly defamatory statements in Texas, it is undisputed that Binkley is domiciled in Texas, which weighs heavily in favor of applying Texas's anti-SLAPP statute.6 See Underground Sols., Inc. , 41 F. Supp. 3d at 726 (finding that a speaker's residence is one of the "central" factors to consider in determining which state's anti-SLAPP statute to apply). Thus, the Court finds that applying California's anti-SLAPP statute to a Texas defendant would impede on Texas's interest in protecting its citizens and fulfilling the statute's purpose in a similar way that applying Texas's defamation law to a California plaintiff would infringe on California's interests. The Court therefore will analyze whether Texas's anti-SLAPP statute applies in federal court.

B. Does Texas's Anti-SLAPP Apply in Federal Court?

Having found that Texas's anti-SLAPP statute is the one that potentially would apply in this case, the Court must now determine whether it in fact applies under the doctrine set out in Erie R. Co. v. Tompkins , 304 U.S. 64, 78, 58 S.Ct. 817, 82 L.Ed. 1188 (1938). Texas's anti-SLAPP statute "protects citizens who petition or speak on matters of public concern from retaliatory lawsuits that seek to intimidate or silence them." In re Lipsky , 460 S.W.3d 579, 584 (Tex. 2...

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  • Todd O'Gara & Wanu Water, Inc. v. Hunter (In re Hunter)
    • United States
    • U.S. Bankruptcy Court — Middle District of North Carolina
    • November 8, 2019
    ...each filed requests for judicial notice. Hunter requests this Court take notice of three documents filed in O'Gara v. Binkley , 384 F. Supp. 3d 674 (N.D. Tex. 2019), a case brought by the same Plaintiffs, raising the same causes of actions, against an alleged co-conspirator of Hunter, Josep......

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