In re Lipsky

• Decision Date: 10 October 2013
• Docket Number: No. 02–12–00348–CV.,02–12–00348–CV.
• Citation: 411 S.W.3d 530
• Parties: In re Steven and Shyla LIPSKY and Alisa Rich, Relators.
• Court: Texas Court of Appeals

411 S.W.3d 530

In re Steven and Shyla LIPSKY and Alisa Rich, Relators.

No. 02–12–00348–CV.

Court of Appeals of Texas, Fort Worth.

April 22, 2013.

Rehearing and En Banc Reconsideration Overruled Oct. 10, 2013.

Brent M. Rosenthal, Rosenthal Pennington LLP, Dallas, TX, Allen M. Stewart, Allen Stewart, P.C., Dallas, TX, Donald E. Godwin, George R. Carlton & Shawn McCaskill, Godwin Ronquillo PC, Dallas, TX, for Relators.

John H. Cayce, Jr., & Jeff Whitfield, Kelly Hart & Hallman LLP, Fort Worth, TX, Andrew D. Sims & Russell R. Barton, Harris, Finley & Bogle, P.C., Fort Worth, TX, for Real Parties in Interest.

PANEL: LIVINGSTON, C.J.; DAUPHINOT and GARDNER, JJ.

OPINION

TERRIE LIVINGSTON, Chief Justice.

Relators Steven and Shyla Lipsky (the Lipskys) and Alisa Rich seek a writ of mandamus that directs the trial court to dismiss the claims asserted against them by real parties in interest Range Production Company and Range Resources Corporation (Range). Relators contend that provisions contained within chapter 27 of the civil practice and remedies code (chapter 27) require the dismissal of Range's claims.¹ We conditionally grant relief in part and deny relief in part.²

Background Facts

The Lipskys own a home in the Silverado on the Brazos development in Weatherford. In 2005, they drilled a well to a depth of about two hundred feet to provide water to their home and property, and they also constructed a large holding tank to meet the anticipated water needs at the property. Range drilled two natural gas wells in 2009 near the Lipskys' property. According to the Lipskys, in the latter part of 2009, they began noticing problems with their water, and by the middle of 2010, their water pump began experiencing “gas locking,” meaning that the pump could not efficiently move water. The Lipskys contacted public health officials, who referred them to Rich. After the Lipskys contracted in August 2010 with Rich and her company, Wolf Eagle Environmental, to conduct testing, she confirmed the presence of various gases in the Lipskys' water well.

In December 2010, after being notified by Rich and the Lipskys about the circumstances at the Lipskys' property and after conducting its own investigation, the Environmental Protection Agency (EPA) issued an emergency order stating that Range's production activities had caused or contributed to the gas in the Lipskys' water well and that the gas could be hazardous to the Lipskys' health. In the order, the EPA required Range to, among other actions, provide potable water to the Lipskys and install explosivity meters at the Lipskys' property. The federal government, acting at the request of the EPA, later filed a lawsuit in a federal district court against Range, alleging that Range had not complied with requirements of the emergency order.

The Railroad Commission of Texas (the Railroad Commission) also investigated the contamination of the Lipskys' well. After calling a hearing and listening to testimony from several witnesses in January 2011, the Railroad Commission issued a unanimous decision in March 2011 that Range had not contaminated the Lipskys' water.³ Thus, the Railroad Commission allowed production from Range's wells to continue.

In June 2011, the Lipskys sued several defendants, including Range, for claims related to the contamination of their water well that, according to the Lipskys, resulted from Range's “oil and gas drilling activities.” In their original petition, the Lipskys claimed that the contamination had caused a water pump to malfunction and had caused the water “to be flammable.” Against Range, the Lipskys sought compensatory and punitive damages while asserting causes of action for negligence, gross negligence, and private nuisance. The Lipskys alleged that Range's drilling, including hydraulic fracture stimulation operations (fracking), affected their water source, and they contended that they could no longer use their home as a residence.⁴

A month after the Lipskys sued Range, Range answered the suit and brought counterclaims (against the Lipskys) and third-party claims (against Rich) for civil conspiracy, aiding and abetting, defamation, and business disparagement. Range contended, among other arguments, that Range's fracking of a deep shale formation could not have contaminated the Lipskys' much shallower water well; that Range's two gas wells near the Lipskys' residence had “mechanical integrity”; that other factors occurring before Range's drilling contributed to gas in the Lipskys' well; that the Railroad Commission had already found that Range's drilling did not contaminate the Lipskys' well; that the contrary conclusion that had been reached by the EPA was based on incomplete and overlooked data; ⁵ that the Lipskys had ignored the Railroad Commission's findings by continuing to blame Range for the contamination; that Rich, along with the Lipskys, had, with malice against Range, made false, misleading, and disparaging statements; and that Range's business reputation had therefore suffered.

The Lipskys and Rich each answered Range's claims against them, and they later each filed motions to dismiss the claims under chapter 27. In their motions, relators argued, among other contentions, that through bringing its affirmative claims, Range intended to suppress relators' right of free speech and their right to petition (including petitioning the EPA to act on the Lipskys' water contamination) and that Range had not provided clear and specific evidence establishing prima facie proof of each element of its claims. Documents attached to the Lipskys' motion to dismiss established, among other facts, that the possible contamination of water by drilling and fracking has been a matter of public concern in recent years; that the Lipskys began noticing problems with their drinking water in 2009, which was after Range began drilling; that in 2005, before Range began production in Silverado on the Brazos, Steven Lipsky saw another water well that contained gas fumes; that the Lipskys cooperated with Rich (and her company, Wolf Eagle Environmental) to obtain water and air samples (which showed the presence of benzene, toluene, ethane, and methane) and to get the EPA involved in investigating the contamination of the Lipskys' well; that the Lipskys complained to the Railroad Commission about their water well containing natural gas; that Steven Lipsky created a video of igniting gas from his well and shared the video with “friends and family”; ⁶ that as of his deposition in January 2011, Steven Lipsky still was not sure how natural gas entered his well water; that Rich testified in a deposition that the test results from the Lipskys' water were “not ... high enough to cause an imminent ... danger”; and that Rich told the EPA that Steven Lipsky had “demonstrated in her presence that he could light his water hose which was attached to his well vent and that a ‘10–foot flare’ was the result.”

Range opposed the motions to dismiss, detailing the evidence that Range offered in support of the claims. The trial court denied the motions. Relators filed an interlocutory appeal, and we dismissed the appeal for want of jurisdiction.⁷ However, we allowed relators to challenge the propriety of the trial court's order denying the dismissal motions through this original proceeding.⁸

Mandamus Standards

Mandamus relief is proper only to correct a clear abuse of discretion when there is no adequate remedy by appeal. In re Columbia Med. Ctr. of Las Colinas, 290 S.W.3d 204, 207 (Tex.2009) (orig. proceeding); In re Aslam, 348 S.W.3d 299, 301 (Tex.App.-Fort Worth 2011, orig. proceeding). A trial court clearly abuses its discretion when it reaches a decision so arbitrary and unreasonable as to amount to a clear and prejudicial error of law or if it clearly fails to correctly analyze or apply the law. In re Olshan Found. Repair Co., 328 S.W.3d 883, 888 (Tex.2010) (orig. proceeding); Walker v. Packer, 827 S.W.2d 833, 839 (Tex.1992) (orig. proceeding).

With respect to the resolution of factual issues or matters committed to the trial court's discretion, we may not substitute our judgment for that of the trial court unless a relator establishes that the trial court could reasonably have reached only one decision and that the trial court's decision is arbitrary and unreasonable. In re Sanders, 153 S.W.3d 54, 56 (Tex.2004)(orig. proceeding); Walker, 827 S.W.2d at 839–40;In re Tex. Collegiate Baseball League, Ltd., 367 S.W.3d 462, 468–69 (Tex.App.-Fort Worth 2012, orig. proceeding). This burden is a heavy one. Aslam, 348 S.W.3d at 302 (citing In re CSX Corp., 124 S.W.3d 149, 151 (Tex.2003) (orig. proceeding)).

While we give deference to a trial court's factual determinations that are supported by evidence, we review the trial court's legal determinations de novo. In re Labatt Food Serv., L.P., 279 S.W.3d 640, 643 (Tex.2009) (orig. proceeding). A trial court abuses its discretion if it fails to analyze the law correctly or misapplies the law to established facts. Iliff v. Iliff, 339 S.W.3d 74, 78 (Tex.2011); State v. Sw. Bell Tel. Co., 526 S.W.2d 526, 528 (Tex.1975). Also, a trial court's erroneous legal conclusion, even in an unsettled area of law, is an abuse of discretion. In re United Scaffolding, Inc., 301 S.W.3d 661, 663 (Tex.2010) (orig. proceeding).

Standards for Motions to Dismiss Under Chapter 27

When the legislature enacted chapter 27 in 2011, it expressed that the purposes of doing so were to “encourage and safeguard the constitutional rights of persons to petition, speak freely, associate freely, and otherwise participate in government to the maximum extent permitted by law and, at the same time, protect the rights of a person to file meritorious lawsuits for demonstrable injury.” Tex. Civ. Prac. & Rem.Code Ann. § 27.002. To promote these purposes, chapter 27 creates an avenue at the early stage of litigation for dismissing unmeritorious suits that are based on the defendant's...