Writt v. Shell Oil Co.

Decision Date25 June 2013
Docket NumberNo. 01–11–00201–CV.,01–11–00201–CV.
Citation409 S.W.3d 59
PartiesRobert WRITT, Appellant v. SHELL OIL COMPANY and Shell International, E & P, Inc., Appellees.
CourtTexas Court of Appeals

OPINION TEXT STARTS HERE

Kenneth D. Hughes, The Huges Law Firm, Robert Dubose, Alexander Dubose & Townsend LLP, Houston, TX, for Appellant.

Macey Reasoner Stokes, Baker Botts, L.L.P., James Edward Maloney, Andrews Kurth LLP, Tracy Nicole Leroy, Sidley Austin LLP, Houston, TX, for Appellees.

Panel consists of Justices JENNINGS, SHARP, and BROWN.

OPINION

TERRY JENNINGS, Justice.

Appellant, Robert Writt, challenges the trial court's rendition of summary judgment in favor of appellees, Shell Oil Company and Shell International, E & P, Inc. (collectively, Shell), in Writt's suit against Shell for defamation. In two issues, Writt contends that the trial court erred in granting Shell summary judgment as Shell did not have an “absolute privilege,” or “immunity,” to make defamatory statements about him to the United States Department of Justice (“DOJ”), he presented evidence of the damages caused by Shell's defamation, and damages are presumed as a matter of law on his claim for defamation per se.1

Introduction

Because the absolute privilege could possibly be used improperly as a sword, rather than properly as a shield, Texas courts and the Restatement of the Law on Torts have long distinguished between it, for communications made during judicial and quasi-judicial proceedings, and the qualified, or conditional, privilege, for communications made in the public interest.2 To extend the absolute privilege to the circumstances of the instant case, where neither Shell nor Writt was a party to an ongoing or proposed judicial or quasi-judicial proceeding at the time that Shell made the complained-of statements, would have the very dangerous effect of actually discouraging parties from being truthful with law-enforcement agencies and instead encourage them to deflect blame to others without fear of consequence.

The “immunity” conferred by the absolute privilege attaches only to a “select number of situations which involve the administration of the functions of the branches of government, such as statements made during legislative and judicial proceedings.” 3 And a defendant is entitled to summary judgment on the basis of the absolute privilege only if the evidence conclusively proves the privilege's application.4

Here, as detailed below, Shell presented summary-judgment evidence that the DOJ requested a forty-five minute meeting with Shell to discuss its business dealings with another company. And, during the meeting, Shell, according to the DOJ, agreed to “voluntarily investigate its business dealings” with the company and provide the DOJ with certain documents and Shell's “proposed investigative plan.” Eighteen months later, Shell provided its investigative report, which contains the complained-of statements about Writt, to the DOJ. As noted by Shell, it was not until twenty months after it had given the investigative report to the DOJ that the DOJ first “open[ed] a judicial proceeding and file[d] a criminal information” against Shell. There simply is no evidence that a criminal case had been filed against Writt or Shell, or that a criminal prosecution was actually being proposed against either Writt or Shell, at either the time the DOJ first contacted Shell or when Shell submitted its report to the DOJ. Thus, we conclude that the summary-judgment evidence does not conclusively establish the applicability of the absolute privilege to the complained-of statements made by Shell in its voluntarily-made investigative report to the DOJ.5

However, given that a “sufficiently important public interest” may have “require[d] that Shell make the communication to the DOJ, whether solicited by the DOJ or not, “to take action if the defamatory matter [were] true,” we conclude that Shell enjoys the adequate protection of the conditional privilege as a “Communication to One Who May Act in the Public Interest.” 6 As noted below, the conditional privilege is “applicable when any recognized interest of the public is in danger, including the interest in the prevention of crime and the apprehension of criminals, the interest in the honest discharge of their duties by public officers, and the interest in obtaining legislative relief from socially recognized evils.” 7

Accordingly, we reverse the judgment of the trial court and remand for proceedings consistent with this opinion.8

Background

In his petition, Writt alleges that, as an employee of Shell, he was charged with the responsibility of approving payments to contractors on certain Shell projects in foreign countries, including Nigeria. During the course of his work, Writt learned that certain Shell contractors were under investigation “by various governmental agencies” for making and receiving illegal payments and one of Shell's vendors had pleaded guilty to violating the Foreign Corrupt Practices Act (“FCPA”).9 Writt further alleged that, in response to an informal inquiry to Shell from the DOJ, Shell had “voluntarily” submitted to the DOJ a report in which Shell “falsely accused him” of “engaging in unethical conduct” in connection with the payment of “bribes” and providing inconsistent statements during multiple interviews conducted by Shell as part of its internal investigation. Writt asserted a claim for defamation 10 against Shell for the allegedly false statements contained in its report to the DOJ. Specifically, Writt alleged that Shell, in its report, falsely stated that he had been involved in illegal conduct in a Shell Nigerian project by recommending that Shell reimburse contractor payments he knew to be bribes and failing to report illegal contractor conduct of which he was aware.

In its summary-judgment motion, Shell argued that because the statements made in its report to the DOJ were “absolutely privileged,” they could not give rise to a defamation claim. Shell asserted that federal regulations authorize the DOJ to prosecute violations of the FCPA,11 it “agreed with the DOJ to undertake the internal investigation,” it furnished the report to the DOJ “with the understanding that the facts in the report would be used by the DOJ in determining whether or not to prosecute Shell for FCPA violations,” and the report related to the DOJ investigation.

In support of its summary-judgment motion, Shell attached a copy of a July 3, 2007 letter from Mark Mendelsohn of the Fraud Section of the DOJ's Criminal Division to Shell. In his letter, Mendelsohn stated in pertinent part:

It has come to our attention that [Shell] has engaged the services of Panalpina, Inc. (“Panalpina”)[ 12] to provide freight forwarding and other services in the United States and abroad, and that certain of those services may violate the [FCPA]. The purpose of this letter is to request a meeting with you to further discuss Shell's engagement of Panalpina. We anticipate this initial meeting will not take longer than 45 minutes.

(Emphasis added.) Mendelsohn also made a “request” that, in advance of the meeting, Shell “prepare and provide the Fraud Section a spreadsheet detailing in what countries Shell has used the services of Panalpina” and “the total amount of payments for such services for the past five years.”

Shell also attached to its motion the affidavit of Michael Fredette, Shell's Managing Counsel, who testified that, after receiving Mendelsohn's letter, Shell representatives met with the DOJ and Shell “agreed to conduct an internal investigation into its dealings with Panalpina.” (Emphasis added.) Fredette further testified:

I was one of the leaders of Shell's internal investigation. The investigative team was comprised of members of the Shell Legal Department and Shell's Business Integrity Department, and assisted by outside counsel from Vinson & Elkins LLP and forensic accountants from KPMG LLP.

Shell's Business Integrity Department is staffed with attorneys and former law enforcement officers, including former Federal Bureau of Investigation agents.

The internal investigation began in August 2007, and culminated in a written report submitted to the [DOJ] on or about February 5, 2009. Shell submitted the report to the [DOJ] with the understanding that the report would be treated confidentially.

Shell agreed to conduct the internal investigation with the understanding that it would ultimately report its finding to the [DOJ] and that the [DOJ] would conduct its own investigation for possible violations of the [FCPA] and other laws by Shell and/or its employees.

(Emphasis added.)

Additionally, Shell attached to its summary-judgment motion a July 17, 2007 letter from Stacey K. Luck of the DOJ's Fraud Section to Shell's legal counsel, C. Michael Buxton of Vinson & Elkins LLP. In the letter, Luck stated in pertinent part:

Thank you and your client, [Shell], for meeting with us today. As discussed, it is our understanding that Shell intends to voluntarily investigate its business dealings with Panalpina Inc. and all other Panalpina subsidiaries and affiliates (collectively referred to as “Panalpina”).

(Emphasis added.) Luck requested that “in conducting the investigation,” Shell produce certain documents and information pertaining to the time period of June 2002 through June 2007. Luck also specifically requested that [p]rior to initiating your investigation” and the production of any documents, Shell provide the current location of a number of individuals, including Writt, who had been associated with a Shell project in Nigeria from January 1, 2004 to December 31, 2005. And Luck requested Shell's “proposed investigative plan,” including the “estimated volume of documents implicated,” “number of individuals to be interviewed,” and “proposed duration of the investigation.”

Finally, we note that Shell also attached to its motion, among other documents, a copy of a September 4, 2008 Vinson & Elkins memorandum regarding an “Overview...

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