Summary
holding that Castleman does not limit commercial-speech exemption's applicability only to speech or conduct intended to secure future transactions (citing North Cypress Med. Ctr. Operating Co. GP, LLC v. Norvil, 580 S.W.3d 280, 286 (Tex. App.—Houston [1st Dist.] 2019, pet. denied))
Summary of this case from Molina Healthcare, Inc. v. State ex rel. ThurmondOpinion
NO. 14-19-00543-CV
08-25-2020
ROUND TABLE PHYSICIANS GROUP, PLLC, and Lisa Snyder, Appellants v. Julie KILGORE, Individually and as Next Friend of XXXX Kilgore, a Minor, Appellee
Appellants Round Table Physicians Group, PLLC and Lisa Snyder appeal the denial of their Texas Citizens Participation Act ("TCPA") motion to dismiss Julie Kilgore's declaratory judgment suit, which alleges that Round Table's chapter 55 medical lien is fraudulent. Round Table argues that the trial court erred by denying the motion to dismiss because the TCPA applies to Kilgore's claim, no statutory exemptions apply, Kilgore did not present prima facie evidence in support of her claim, and Round Table conclusively proved a defense. After examining the statutory language and relevant case law, we conclude that the TCPA's "commercial speech" exemption applies in this case. Accordingly, we affirm the part of the trial court's order denying the appellants' motion to dismiss under the TCPA.
We refer to appellants collectively as "Round Table" unless indicated otherwise.
See Tex. Prop. Code § 55.002.
See Tex. Civ. Prac. & Rem. Code §§ 27.001 -.011 (West 2015). The TCPA was amended in 2019. See Act of May 17, 2019, 86th Leg., R.S., ch. 378, 2019 Tex. Gen. Laws 684. The 2019 amendments do not apply to this case, which was filed on February 22, 2019. See id. §§ 11-12, 2019 Tex. Gen. Laws at 687 (providing that amendments apply to actions filed on or after September 1, 2019). We refer to the TCPA version applicable to this dispute.
In its order, the trial court also expressly reached a merits issue and determined that Round Table's liens are invalid. In our court, Round Table challenges that part of the order as well. Concluding, however, that we lack jurisdiction over Round Table's attack on the portion of the trial court's order adjudicating the merits, we dismiss that part of Round Table's appeal.
Background
Julie Kilgore and her minor child were involved in an automobile collision, after which Kilgore and her child received medical treatment from Round Table Physicians Group, PLLC. Round Table is a physician group that provides medical services at a freestanding emergency medical care facility. Round Table billed Kilgore $700 for medical treatment provided to her and $500 for medical treatment provided to her son.
Approximately two weeks after treating Kilgore and her child, Round Table filed with the county clerk two notices of liens (for the services respectively rendered to Kilgore and to her child) under Texas Property Code chapter 55. Chapter 55 creates a lien in favor of certain medical providers who treat individuals allegedly injured by the negligence of a third party and establishes procedures to secure the lien. See Tex. Prop. Code § 55.002(a)-(d) (stating that, subject to certain conditions, hospital or emergency medical services provider has lien on cause of action of patient who receives hospital services for injuries caused by accident attributed to another's negligence). The lien attaches to the patient's personal-injury cause of action, as well as to any corresponding judgment or proceeds of settlement. Id. § 55.003(a)(1)-(3). The statute's purpose is to provide hospitals "an additional method of securing payment from accident victims, encouraging their prompt and adequate treatment." In re N. Cypress Med. Ctr. Operating Co., Ltd. , 559 S.W.3d 128, 131 (Tex. 2018) (orig. proceeding). Round Table also provided written notice of the lien filings to Kilgore. See Tex. Prop. Code § 55.002(a), (d).
Kilgore, individually and as next friend of her child, sued the third party alleged to have caused the car accident and joined Round Table and Snyder—Round Table's revenue specialist manager who signed the liens—as defendants. Kilgore sought a declaratory judgment that the liens were invalid because Round Table is not authorized to file a lien under chapter 55 and that the charges secured by the liens were not reasonable. Kilgore sought monetary relief under the fraudulent lien statute. See Tex. Civ. Prac. & Rem. Code § 12.002.
Round Table and Snyder filed a motion to dismiss under the TCPA, arguing that Kilgore's legal action related or was in response to notices of the liens, which Round Table contended were an exercise of its rights of free speech and to petition. Round Table also argued that Kilgore could not present prima facie evidence of her claims. As relevant here, Kilgore responded that the TCPA did not apply because Round Table's notices of liens were commercial speech exempted from the TCPA. In a single order, the trial court denied the motion to dismiss and also determined that Round Table's liens "are invalid as they do not meet the criteria of being a hospital lien or an emergency medical services lien per Ch. 55 of the Texas Property Code." Round Table challenges both rulings in the trial court's order by interlocutory appeal.
See Tex. Civ. Prac. & Rem. Code § 27.010(b). Kilgore also argued that the Act's "bodily injury" exemption applied. See id. § 27.010(c) ("This chapter does not apply to a legal action seeking recovery for bodily injury, wrongful death, or survival or to statements made regarding that legal action."). Given our disposition, we need not address this alternative argument. See Tex. R. App. P. 47.1.
See Tex. Civ. Prac. & Rem. Code § 51.014(a)(12) (a person may appeal from an interlocutory order that denies a motion to dismiss under section 27.003).
Analysis
Round Table argues that the trial court erred by denying its TCPA motion to dismiss. According to Round Table: the Act applies because Kilgore's legal action is based on, relates to, or is in response to Round Table's exercise of its rights to petition or speak freely; no statutory exemption applies; Kilgore failed to provide prima facie evidence of her claims; and Round Table proved a defense. Kilgore responds that the Act does not apply because her claims are exempted under the statutory "commercial speech" provision. Regarding the trial court's finding that the liens are invalid, Round Table contends that the trial court erred by reaching that merits issue because it was not presented by the TCPA motion to dismiss.
A. The Texas Citizens Participation Act
The TCPA contemplates an expedited dismissal procedure when a "legal action" is "based on, relates to, or is in response to a party's exercise of the right of free speech, right to petition, or right of association." Tex. Civ. Prac. & Rem. Code § 27.003(a). The rights of free speech and to petition are at issue here. The TCPA defines "the exercise of the right of free speech" as "a communication made in connection with a matter of public concern." Id. § 27.001(3). A "matter of public concern" is defined in relevant part as including "an issue related to ... health or safety; [or] a good, product, or service in the marketplace." Id. § 27.001(7)(A), (E). "Exercise of the right to petition" means, as relevant here: a communication in or pertaining to a judicial proceeding or an official proceeding, other than a judicial proceeding, to administer the law; or a communication in connection with an issue under consideration or review, or that is reasonably likely to encourage consideration or review of an issue, by a legislative, executive, judicial, or other governmental body or in another governmental or official proceeding. Id. § 27.001(4)(A)(i)-(ii), (B), (C). For both the right of free speech and the right to petition, a " ‘[c]ommunication’ includes the making or submitting of a statement or document in any form or medium, including oral, visual, written, audiovisual, or electronic." Id. § 27.001(1).
In enacting the TCPA, the legislature explained that its overarching purpose is "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." Id. § 27.002. "To effectuate the statute's purpose, the Legislature has provided a two-step procedure to expedite the dismissal of claims brought to intimidate or to silence a defendant's exercise of these First Amendment rights." ExxonMobil Pipeline Co. v. Coleman , 512 S.W.3d 895, 898 (Tex. 2017) (per curiam). In the first step, the party filing a motion to dismiss under the TCPA bears the burden to show by a "preponderance of the evidence" that the "legal action" is "based on, relates to, or is in response to," as relevant to this appeal, the party's exercise of the right of free speech or right to petition. Tex. Civ. Prac. & Rem. Code §§ 27.003(a), 27.005(b) ; see also Coleman , 512 S.W.3d at 898. If the movant satisfies this burden, the trial court must dismiss the lawsuit unless an exemption applies or unless the nonmovant "establishes by clear and specific evidence a prima facie case for each essential element of the claim in question." Tex. Civ. Prac. & Rem. Code § 27.005(c) ; see also Coleman , 512 S.W.3d at 899.
The nonmovant can avoid the Act's burden-shifting requirements by showing that one of several exemptions applies. See Tex. Civ. Prac. & Rem. Code § 27.010. One of those exemptions—known as the "commercial speech" exemption—impacts the present dispute, and we discuss it subsequently. The nonmovant must prove each element of a claimed exemption by a preponderance of the evidence. Hieber v. Percheron Holdings, LLC , 591 S.W.3d 208, 211 (Tex. App.—Houston [14th Dist.] 2019, pet. denied).
In construing the Act and determining its applicability, we review statutory construction issues de novo. See Lippincott v. Whisenhunt , 462 S.W.3d 507, 509 (Tex. 2015) (per curiam). Similarly, whether the parties have met their respective burdens is a question of law that we review de novo. See Dallas Morning News, Inc. v. Hall , 579 S.W.3d 370, 377 (Tex. 2019). Under the de novo standard, we "make an independent determination and apply the same standard used by the trial court in the first instance." Fawcett v. Grosu , 498 S.W.3d 650, 656 (Tex. App.—Houston [14th Dist.] 2016, pet. denied) (internal quotation omitted).
We apply this standard of review to a relatively limited universe of evidence. Courts must consider the relevant pleadings and any supporting or opposing affidavits "stating the facts on which the liability or defense is based." Tex. Civ. Prac. & Rem. Code § 27.006(a). We review this evidence in the light most favorable to the nonmovant. See Brugger v. Swinford , No. 14-16-00069-CV, 2016 WL 4444036, at *2 (Tex. App.—Houston [14th Dist.] Aug. 23, 2016, no pet.) (mem. op.).
B. The Commercial Speech Exemption
Round Table argues that the TCPA applies because filing notices of liens under chapter 55 implicates both the right to free speech and the right to petition. We will presume without deciding that Round Table met its initial burden to show that the Act applies. We need only consider Kilgore's argument that her legal action is exempted from the Act's requirements because the communication or conduct at issue—Round Table's notices of liens—constitute commercial speech. See Santellana v. CentiMark Corp. , No. 01-18-00632-CV, 2019 WL 1442228, at *3 (Tex. App.—Houston [1st Dist.] Apr. 2, 2019, no pet.) (mem. op.) (stating that commercial speech exemption constitutes independent ground "that can fully support a trial court's denial of a motion to dismiss filed pursuant to the TCPA"); see also Tex. R. App. P. 47.1.
Under the commercial speech exemption, the TCPA does not apply:
to a legal action brought against a person primarily engaged in the business of selling or leasing goods or services, if the statement or conduct arises out of the sale or lease of goods, services, or an insurance product, insurance services, or a commercial transaction in which the intended audience is an actual or potential buyer or customer.
Tex. Civ. Prac. & Rem. Code § 27.010(b). Kilgore had the burden to prove that the commercial speech exemption applies by a preponderance of the evidence. See Hieber , 591 S.W.3d at 211 (citing Abatecola v. 2 Savages Concrete Pumping, LLC , No. 14-17-00678-CV, 2018 WL 3118601, at *10 (Tex. App.—Houston [14th Dist.] June 26, 2018, pet. denied) (mem. op.)).
Addressing Kilgore's argument requires us to construe and apply statutory text. In interpreting statutes, our primary purpose is to give effect to the legislature's intent by relying on the plain meaning of the text adopted by the legislature, unless a different meaning is supplied by statutory definition or is apparent from the context, or the plain meaning leads to absurd results. Tex. Lottery Comm'n v. First State Bank of DeQueen , 325 S.W.3d 628, 635 (Tex. 2010) ; see also Liberty Mut. Ins. Co. v. Adcock , 412 S.W.3d 492, 494 (Tex. 2013) ("[O]ur primary objective in construing a statute is to ascertain and give effect to the Legislature's intent."). "We construe a statute's words according to their plain and common meaning unless they are statutorily defined otherwise, a different meaning is apparent from the context, or unless such a construction leads to absurd results." Union Carbide Corp. v. Synatzske , 438 S.W.3d 39, 52 (Tex. 2014). "We take statutes as we find them, presuming the Legislature included words that it intended to include and omitted words it intended to omit." Id. "We do not read words into a statute to make it what we consider to be more reasonable, rather we may do so only to prevent an absurd result." Id.
The Supreme Court of Texas clarified section 27.010(b)'s proper construction in Castleman v. Internet Money Ltd. , 546 S.W.3d 684 (Tex. 2018) (per curiam). The exemption applies when:
(1) the defendant was primarily engaged in the business of selling or leasing goods,
(2) the defendant made the statement or engaged in the conduct on which the claim is based in the defendant's capacity as a seller or lessor of those goods or services,
(3) the statement or conduct at issue arose out of a commercial transaction involving the kind of goods or services the defendant provides, and
(4) the intended audience of the statement or conduct were actual or potential customers of the defendant for the kind of goods or services the defendant provides.
Id. at 688. Thus, the court continued, "the commercial-speech exemption applies only to certain communications related to a good, product, or service in the marketplace—communications made not as a protected exercise of free speech by an individual, but as commercial speech which does no more than propose a commercial transaction." Id. at 690 (internal quotation omitted).
C. Application
Kilgore argues that the commercial speech exemption applies because, inter alia , Round Table is primarily engaged in the business of selling health care services and that Round Table filed the notices of liens in that capacity. See id. at 688 (discussing the first two requirements of commercial speech exemption). There is no dispute that Round Table provides health care services and that it bills for those same services. But Round Table responds that its primary business—treating injured patients—is not a "commercial activity" because selling medical services is "merely ancillary to [its] primary business of treating sick and injured patients." Our sister court in Houston has twice rejected this precise argument. See Sanders as Next Friend of Ejiofor v. Bansal , No. 01-18-00508-CV, 2019 WL 7341660, at *4 (Tex. App.—Houston [1st Dist.] Dec. 31, 2019, pet. denied) (mem. op.); N. Cypress Med. Ctr. Operating Co. GP, LLC v. Norvil , 580 S.W.3d 280, 286 (Tex. App.—Houston [1st Dist.] 2019, pet. denied). The First Court of Appeals explained that, by filing a notice of hospital lien to secure the lien for medical services rendered, a health care provider acts in its capacity "as a seller of the healthcare services" it had provided to the plaintiff. Sanders , 2019 WL 7341660, at *4 ; see also Norvil , 580 S.W.3d at 286 ("The business of selling or leasing goods or services and the business of treating sick and injured people are not mutually exclusive activities."). Round Table filed the notices of liens in its capacity as a seller of health care services—i.e., it filed the notices of liens to protect its right to secure payment for the services rendered to Kilgore and her child. We therefore conclude that Round Table was primarily engaged in the business of selling health care services and it filed the notices of liens in that capacity. See Sanders , 2019 WL 7341660, at *4 ; Norvil , 580 S.W.3d at 286.
Round Table asserts that "Snyder provided no services to the Kilgores," suggesting, we suppose, that Snyder's role in signing the notices of liens should not be considered commercial speech. Not only does Round Table fail to expressly advance such an argument, but the only logical conclusion is that Snyder, as Round Table's revenue specialist manager, "was similarly and necessarily ‘primarily engaged’ in the same ‘business’ as [Round Table]." Rose v. Sci. Mach. & Welding, Inc. , No. 03-18-00721-CV, 2019 WL 2588512, at *5 (Tex. App.—Austin June 25, 2019, pet. denied) (mem. op.).
Round Table was one of the named appellees in Sanders. See 2019 WL 7341660, at *1.
We next turn to Castleman 's third requirement: that the communication or conduct arose out of a commercial transaction involving the kind of services Round Table provided. Round Table does not dispute that it filed the notices of liens to secure payment for the health care services it provided to Kilgore and her child, but it nonetheless contends the notices of liens are not commercial speech. According to Round Table, for a statement to arise out of a commercial transaction, it must be made for the purpose of securing a future sale, not an already completed transaction. For this proposition, Round Table reads Castleman as holding that the commercial speech exemption applies only to statements made for the purpose of securing sales—i.e., proposed transactions, not completed transactions.
We disagree that Castleman can or should be read so narrowly. Castleman simply explains that the statement or conduct at issue must "ar[i]se out of a commercial transaction involving the kind of goods or services the defendant provides." Castleman , 546 S.W.3d at 688. We determine today, as the First Court of Appeals previously has determined, that Castleman does not limit the exemption's applicability only to speech or conduct intended to secure future transactions. See Norvil , 580 S.W.3d at 286. This is evident from the statutory language that encompasses statements or conduct arising out of the sale of services in which the intended audience is an "actual" customer, which includes customers who have already consummated a commercial transaction with the defendant. See Tex. Civ. Prac. & Rem. Code § 27.010(b). Here, because Round Table's notices of liens "arose out of a commercial transaction involving the kind of ... services" Round Table provides, the requirement is satisfied. Castleman , 546 S.W.3d at 688 ; see also Norvil , 580 S.W.3d at 286 (holding that hospital lien "arose out of a commercial transaction" involving provision of health care services).
Finally, Kilgore argues that she was an actual customer of Round Table's health care services and thus was the intended audience of the notices of liens. See Castleman , 546 S.W.3d at 689 (stating that intended audience of statement or conduct must be defendant's actual or potential customers for kind of goods or services defendant provides). Round Table disagrees and contends that the intended audience was the public at large and did not include Kilgore. Other courts of appeals have held that, because a hospital has no contractual or tort rights against a third-party tortfeasor, "the only true support for a hospital lien is via a claim for reimbursement," which "is necessarily a claim against [the patient] as the owner of those proceeds." E. Tex. Med. Ctr. Athens v. Hernandez , No. 12-17-00333-CV, 2018 WL 2440508, at *4 (Tex. App.—Tyler May 31, 2018, pet. denied) (mem. op.) (citing Daughters of Charity Health Servs. of Waco v. Linnstaedter , 226 S.W.3d 409, 411 (Tex. 2007) ); see also Sanders , 2019 WL 7341660, at *6 ; Norvil , 580 S.W.3d at 286. In other words, a provider's lien against a patient's tort recovery is a claim against the patient, and therefore Kilgore, as Round Table's patient and actual customer, is included within Round Table's intended audience in filing a notice of lien. See Sanders , 2019 WL 7341660, at *6 ; Norvil , 580 S.W.3d at 286 ; see also Schmidt v. Crawford , 584 S.W.3d 640, 654 (Tex. App.—Houston [1st Dist.] 2019, no pet.) (explaining that hospital lien statute "necessarily makes the injured person a member of the hospital lien's intended audience in order to effectuate its purpose, which is to ensure that the hospital gets paid from any funds that [the patient] may recover from the third party who allegedly made her medical treatment necessary"); Linnstaedter , 226 S.W.3d at 411 ("[A] lien against a patient's tort recovery is just as much a claim against the patient as if it were filed against the patient's house, car, or bank account."). We agree with the reasoning articulated in these decisions.
Further, the text of Property Code section 55.005 buttresses our holding that Kilgore, as Round Table's actual customer for health-care services, qualifies as a member of the "intended audience" for purposes of the commercial speech exemption. Subsection 55.005(a) requires the provider to file a notice of lien with the county clerk of the county in which the services were provided. Tex. Prop. Code § 55.005(a). Additionally, the health care provider must mail the injured patient written notice that the lien has been claimed. Id. § 55.005(a), (d). We can accept, as our dissenting colleague observes, that these are separate communications and that the notice of lien filed with the county clerk communicates to those liable or indebted to the individual who received the services the fact that a lien has been claimed. See id. § 55.005(a), (b). But filing a notice of lien with the county clerk cannot by itself "secure the lien." See id. § 55.005(a). To secure the lien, the provider must give written notice to the patient that the lien has been claimed. In this regard, the patient is also part of the provider's intended audience because she has a statutory right to know—and the provider has a statutory duty to inform her—that a medical lien has been asserted against her, and thus the provider has demanded reimbursement out of any recovery the patient may receive from the responsible parties. The notice of lien filed with the county clerk and the notice to the patient may be separate communications, but the notice to the patient is intended to inform her of the lien's existence.
After considering the language of the TCPA's commercial speech exemption in light of Castleman and other relevant authority, we conclude that Kilgore met her burden of establishing each element of the exemption in section 27.010(b). Accordingly, we hold that Round Table's notices of liens are commercial speech exempt from the TCPA's dismissal procedures, and as such, cannot support dismissal of Kilgore's declaratory judgment and fraudulent lien claims. The trial court did not err in denying the TCPA motion to dismiss.
We reach a similar holding in a companion case also issued today. See Round Table Physicians Grp., PLLC v. Medina , No. 14-19-00412-CV, ––– S.W.3d ––––, 2020 WL 5000619 (Tex. App.—Houston [14th Dist.] Aug. 25, 2020, no pet. h.).
D. Relief Granted Beyond the Scope of the Motion to Dismiss
Finally, we address Round Table's last argument that the order granted more relief than requested, by making an ultimate merits determination that Round Table's liens are invalid. We lack jurisdiction, in this interlocutory appeal, to consider Round Table's argument.
Appellate courts have jurisdiction to consider immediate appeals of interlocutory orders, such as the one in this case, only if a statute explicitly provides appellate jurisdiction. See Tex. A & M Univ. Sys. v. Koseoglu , 233 S.W.3d 835, 840 (Tex. 2007). We strictly construe statutes authorizing interlocutory appeals because a statute authorizing an appeal from an interlocutory order is in derogation of the general rule that only final judgments are appealable. Id. at 841. For instance, when an order grants both injunctive relief and non-injunctive relief, a court of appeals possesses interlocutory appellate jurisdiction over only the injunctive portion of the order. See, e.g., Midwestern Cattle Mktg., LLC v. Nw. Cattle Feeders, LLC , No. 02-17-00274-CV, 2018 WL 1414834, at *4 (Tex. App.—Fort Worth Mar. 22, 2018, pet. denied) (mem. op.) (analyzing jurisdiction under Tex. Civ. Prac. & Rem. Code § 51.014(a)(4) ). Similarly, courts may review the part of an order that rules on governmental employees' plea to the jurisdiction on claims against them in their official capacity but not the part of the order ruling on the employees' plea on claims against them in their individual capacities. See, e.g., Johnson v. Boehnke , No. 03-19-00200-CV, 2019 WL 4458797, at *4 (Tex. App.—Austin Sept. 18, 2019, no pet.) (mem. op.) (analyzing jurisdiction under Tex. Civ. Prac. & Rem. Code § 51.014(a)(8) ). Further, we have jurisdiction over an interlocutory appeal from an order denying a plea to the jurisdiction based on an official's "assertion of immunity" under Civil Practice and Remedies Code section 51.014(a)(5). See Tex. Civ. Prac. & Rem. Code § 51.014(a)(5). Yet, in the context of such an appeal, we lack jurisdiction to consider collateral arguments that are not based on assertions of immunity. Sanchez v. Boone , 579 S.W.3d 526, 531, 536-37 (Tex. App.—Houston [14th Dist.] 2019, pet. denied) (affirming order in part; dismissing appeal in part).
As relevant here, a person may appeal from an interlocutory order that denies a motion to dismiss filed under Civil Practice and Remedies Code section 27.003. See Tex. Civ. Prac. & Rem. Code § 51.014(a)(12). Thus, we have jurisdiction to review the portion of the trial court's order denying Round Table's TCPA motion to dismiss. However, there is no statutory authorization for interlocutory review of an order determining the validity of a lien, and accordingly we lack jurisdiction to review the portion of the order that finds Round Table's liens are invalid. See Schlumberger Ltd. v. Rutherford , 472 S.W.3d 881, 886-87 (Tex. App.—Houston [1st Dist.] 2015, no pet.) (court possessed jurisdiction under section 51.014(a)(12) to review only the portion of a trial court's order denying in part a TCPA motion to dismiss, but not the portion of the order granting in part the motion); see also Ray v. Fikes , No. 02-19-00232-CV, 2019 WL 6606170, at *2 (Tex. App.—Fort Worth Dec. 5, 2019, pet. denied) (mem. op.) ("Our interlocutory, appellate jurisdiction allows review of only the trial court's order denying Ray's TCPA motion to dismiss, not the trial court's separate order sustaining and overruling Ray's evidentiary objections to Gallagher's affidavit."); Greiner v. Womack , No. 04-19-00525-CV, 2019 WL 5405904, at *1 n.1 (Tex. App.—San Antonio Oct. 23, 2019, no pet.) (mem. op.) (refusing to consider appellant's arguments pertaining to matters not within the TCPA motion to dismiss).
Accordingly, we dismiss for want of jurisdiction Round Table's interlocutory appeal insofar as it pertains to the part of the trial court's order determining the validity of the liens at issue. Schlumberger , 472 S.W.3d at 886-87 ; see also Sanchez , 579 S.W.3d at 531.
Conclusion
We affirm the part of the trial court's order that denied Round Table's and Snyder's TCPA motion to dismiss. We dismiss for want of jurisdiction Round Table's and Snyder's appeal of the part of the court's order determining that the liens are invalid.
( Frost, C.J., concurring and dissenting).
CONCURRING AND DISSENTING OPINION
Kem Thompson Frost, Chief Justice, concurring and dissenting.
In Castleman v. Internet Money Ltd. , the Supreme Court of Texas laid out a four-prong test to determine when the Texas Citizens Participation Act's commercial-speech exemption applies. Today, this court, relying on recent cases from the First Court of Appeals, concludes that the commercial-speech exemption applies to the filing of a notice of lien under Texas Property Code section 55.005(a)(1). Following the First Court's precedent in cases of first impression in this court avoids a split of authority in the law in the ten-county jurisdiction the two courts share, a goal that preserves vertical stare decisis and serves important rule-of-law values. Yet, doing so today would run afoul of binding high-court precedent. Because the First Court's fourth-prong "intended audience" analysis goes against Castleman , this court should not follow the First Court's cases in analyzing that component of the Castleman test. Instead, the court should use the high court's test and conclude that the statute's commercial-speech exemption does not apply. Because the court reaches the opposite conclusion, I respectfully dissent as to the part of the majority opinion that addresses the trial court's ruling on the motion to dismiss under the Texas Citizens Participation Act ("TCPA") filed by appellants Round Table Physicians Group, PLLC and Lisa Snyder (collectively, the "Round Table Parties"). I join in the court's judgment dismissing this appeal for lack of jurisdiction to the extent the Round Table Parties seek to appeal the part of the trial court's order determining the validity of the liens at issue.
546 S.W.3d 684, 688 (Tex. 2018) (per curiam).
See Tex. Prop. Code Ann. § 55.005 (West, Westlaw through 2019 R.S.); Ante at 885–86 (citing Sanders as Next Friend of Ejiofor v. Bansal , No. 01-18-00508-CV, 2019 WL 7341660, at *4 (Tex. App.—Houston [1st Dist.] Dec. 31, 2019, pet. denied) (mem. op.); Schmidt v. Crawford , 584 S.W.3d 640, 654 (Tex. App.—Houston [1st Dist.] 2019, no pet.) ; and N. Cypress Med. Ctr. Operating Co. GP, LLC v. Norvil , 580 S.W.3d 280, 286 (Tex. App.—Houston [1st Dist.] 2019, pet. denied) ).
See Tucker v. Thomas , 405 S.W.3d 694, 715–18 (Tex. App.—Houston [14th Dist.] 2011) (Frost, J., concurring), reversed in part on other grounds , 419 S.W.3d 292 (Tex. 2013).
Identifying the Purpose of the Speech or Conduct
The Round Table Parties assert that Round Table is a person or institution maintaining a facility that provides hospital services in Texas and therefore is a "hospital" for the purposes of Texas Property Code Chapter 55. A hospital has a lien on a claim of an individual who receives hospital services for injuries caused by an accident that is attributed to the negligence of another person. For the lien to attach, the injured individual must be admitted to a hospital not later than 72 hours after the accident. To secure this lien, a hospital must (1) provide notice to the injured individual in accordance with subsection (d) of section 55.005 ; and (2) file written notice of the lien with the county clerk of the county in which the services were provided before money is paid to an entitled person because of the injury. The resulting lien attaches to the patient's personal-injury claim, as well as to any corresponding judgment or settlement proceeds. By securing a lien under section 55.005, the hospital gains another avenue for obtaining payment from accident victims for medical services provided to treat injuries caused by third parties ("Covered Costs"). The purpose and mechanics of creating this non-consensual statutory lien inform the answer to Castleman's intended-audience inquiry.
See Tex. Prop. Code § 55.001(3) (West, Westlaw through 2019 R.S.).
See Tex. Prop. Code § 55.002(a) (West, Westlaw through 2019 R.S.).
See id.
See id. § 55.005(a) (West, Westlaw through 2019 R.S.).
See id. § 55.003(a) (West, Westlaw through 2019 R.S.).
See id. §§ 55.002, 55.003, 55.005; In re N. Cypress Med. Ctr. Operating Co., Ltd. , 559 S.W.3d 128, 131 (Tex. 2018) (orig. proceeding)(holding statute's purpose is to provide hospitals "an additional method of securing payment from accident victims, encouraging their prompt and adequate treatment")
Castleman's Fourth-Prong Inquiry
The majority concludes that the TCPA does not apply because the hospital's notice of lien under section 55.005 amounts to commercial speech and so falls under the TCPA's commercial-speech exemption. The Castleman court interpreted the statutory text as providing that the commercial-speech exemption applies if:
See Tex. Civ. Prac. & Rem. Code § 27.010(b) (West, Westlaw through 2019 R.S.) (stating that the TCPA does not apply "to a legal action brought against a person primarily engaged in the business of selling or leasing goods or services, if the statement or conduct arises out of the sale or lease of goods, services, or an insurance product, insurance services, or a commercial transaction in which the intended audience is an actual or potential buyer or customer").
(1) the defendant was primarily engaged in the business of selling or leasing goods or services,
(2) the defendant made the statement or engaged in the conduct on which the claim is based in the defendant's capacity as a seller or lessor of those goods or services,
(3) the statement or conduct at issue arose out of a commercial transaction involving the kind of goods or services the defendant provides, and
(4) the intended audience of the statement or conduct were actual or potential customers of the defendant for the kind of goods or services the defendant provides.
Castleman , 546 S.W.3d at 688.
The majority agrees that these four required elements must be shown for the commercial-speech exemption to apply. To prevail, appellee Julie Kilgore, individually and as next friend of her minor child, had to prove each element of the claimed exemption by a preponderance of the evidence. She failed to prove at least one of them.
See ante at 884–85.
Hieber v. Percheron Holdings, LLC , 591 S.W.3d 208, 211 (Tex. App.—Houston [14th Dist.] 2019, pet. denied).
Commercial speech "proposes a commercial transaction." Thus, to fall within the TCPA's commercial-speech exemption, the intended audience of the speech or conduct must be "actual or potential customers of the defendant for the kind of goods or services the defendant provides."
See Central Hudson Gas and Electric Corp. v. Public Serv. Comm'n , 447 U.S. 557, 562, 100 S.Ct. 2343, 65 L.Ed.2d 341 (1980).
See Castleman , 546 S.W.3d at 688.
Content of the Notice-of-Lien Filing
The written notice of lien that the Round Table Parties filed with the county clerk of Fort Bend County contains language prescribed in Texas Property Code section 55.005(b). That verbiage does not promote the sale of anything; rather, it puts the public on notice of a debt — the Covered Costs. The Round Table Parties' written notice of lien states:
NOTICE IS HEREBY GIVEN pursuant to the terms and provisions of Texas Property Code Chapter 55, wherein Round Table Physicians Group, PLLC located at 8910 Highway 6 S., Houston, TX 77083, which heretofore and now is a facility that provides emergency services in the State of Texas, is entitled to and hereby claims a lien for emergency services rendered on 04/15/2016 (Date Of Services) to Kilgore, Julie (Name Of Injured Person) , whose address is [address listed], for injuries incurred as a result of an accident attributable to the negligent conduct of UNKNOWN (Name Of Person(s)/ Firm/Corp. Alleged To Be Liable, If Known). Said accident occurred on or about 04/15/2016 (Date of Accident) , and
the above-named injured individual was admitted to Signature Care Emergency Center within seventy-two (72) hours after said accident.
In accordance with § 55.004 of the Texas Property Code, section (c), Signature Care Emergency Center has a lien on the cause of action in the same manner as a hospital. The lien is subject to provisions of this chapter and Round Table Physicians Group may secure and enforce the lien in the manner provided by this chapter. Round Table Physicians Group give [sic] notice of entitlement to and hereby secures a statutory lien under the terms and provisions of the above state Texas statute, as amended, upon any and all claims and/or causes of action the injured individual may have against another person for the individual's injuries.
The intended audience for this nonconsensual, statutory notice-of-lien filing is any member of the public who may be liable to the patient/debtor for the Covered Costs. The patient/debtor is not in that category. The purpose of the lien is not to promote the provision of services but to secure the payment of services rendered. The target audience is not those in need of medical services but those liable or indebted to the injured individual who received them.
The courts that have found the intended-audience element satisfied have likened the medical lien to a claim for reimbursement against the patient and reasoned that the patient is the intended audience. But, the intended audience is precisely where a lien differs from a reimbursement claim.
See E. Tex. Med. Ctr. Athens v. Hernandez , No. 12-17-00333-CV, 2018 WL 2440508, at *4 (Tex. App.—Tyler May 31, 2018, pet. denied) (mem. op.) Sanders , 2019 WL 7341660, at *6 ; Norvil , 580 S.W.3d at 286 ; see also Schmidt v. Crawford , 584 S.W.3d 640, 654 (Tex. App.—Houston [1st Dist.] 2019, no pet.) (explaining that hospital lien statute "necessarily makes the injured person a member of the hospital lien's intended audience in order to effectuate its purpose, which is to ensure that the hospital gets paid from any funds that [the patient] may recover from the third party who allegedly made her medical treatment necessary"); Daughters of Charity Health Servs. of Waco v. Linnstaedter , 226 S.W.3d 409, 411 (Tex. 2007) (stating that "a lien against a patient's tort recovery is just as much a claim against the patient as if it were filed against the patient's house, car, or bank account.").
A lien communicates to the public at large one's rights against a debtor; a reimbursement claim communicates to the debtor one's demand to be paid. The legislature intended the lien to function like a television broadcast that goes to the masses and in the process gets to those who stand liable for the Covered Costs. By contrast, a reimbursement claim functions more like a telephone call, made one on one, to an audience of one. A lien filing and a reimbursement claim carry different messages and play to different audiences.
Separate Provision Addressing Communications with Patient/Debtor
To ensure that the patient/debtor receives notice of the lien, the legislature crafted a statutory provision requiring a separate communication to the patient/debtor. Not later than the fifth business day after the date a hospital receives notice from the county clerk that a notice of lien filed under subsection 55.005(a)(2) has been recorded in the county records, the hospital must send a written notice to the injured individual or the injured individual's legal representative, by regular mail, to the individual's last known address, informing the individual that: (1) the lien will attach to any claim the individual may have against another person for the individual's injuries; and (2) the lien does not attach to real property owned by the individual. This communication tells the patient/debtor of the notice-of-lien filing; it does not serve the same function as the notice-of-lien filing. Significantly, Kilgore bases her claims against the Round Table Parties on two notice-of-lien filings under subsection 55.005(a)(2); she does not base her claims on any notices given under subsection 55.005(d).
See id. An emergency medical services provider is not required to provide notice by mail if the emergency medical services provider provides the notice required by subsection (d) to the injured individual or the injured individual's representative at the time emergency medical services are provided and if: (1) the required notice is included on the emergency medical services authorization form in a paper or electronic version in a separate paragraph that is bolded and in at least 14-point type; and (2) except as provided by subsection (f), the notice is signed by the injured individual or the injured individual's representative. Tex. Prop. Code Ann. § 55.005(e).
A notice-of-lien filing under subsection 55.005(a)(2), directed to those who may be liable for the Covered Costs, tells the intended audience that the party filing the notice of lien is claiming a hospital lien in any claim by the patient/debtor against any third-party who may be liable for damages arising from the injury. The section 55.005(d) notice, directed to the patient/debtor, advises that (1) the hospital lien will attach to any claim the patient/debtor may have against another person for the individual's injuries; and (2) the lien does not attach to real property owned by the patient/debtor. Simply put, the notice-of-lien filing and the section 55.005(d) notice are separate communications, carrying discrete messages, to different audiences.
Nothing in the Lien Resembling Commercial Speech
Nothing in the Round Table Parties' words or conduct resembles commercial speech. The statutory lien notice does not promote any good, product, or service in the marketplace. Nor does it propose a commercial transaction. The words cannot fairly be construed as a communication on behalf of a business made with the intent of generating sales. Nor would one reasonably expect to find that type of message in a lien-notice filing, the contents of which the statute prescribes.
Commercial enterprises generally send one kind of message to produce sales and another kind to collect debts. The messages serve different purposes and go to different audiences. Today's broad-sweeping application undercuts the point of the Castleman fourth-prong inquiry — to remove from the scope of the commercial-speech exemption speech and conduct not directed to "actual or potential customers of the defendant for the kind of goods or services the defendant provides."
See Castleman , 546 S.W.3d at 688.
The majority reasons that because a lien against a patient's tort recovery is a claim against the patient, the patient is included within the intended audience of the notice of lien. The Castleman court did not adopt this "included within" standard and this court should not do so today.
Ante , at 885–86.
See Castleman , 546 S.W.3d at 688.
Even presuming for the sake of argument that the patient/debtor were included in the intended audience of the notice of lien as a member of the general public, that an actual customer happens to fall within the intended audience of the statement or conduct does not mean that the intended audience was the "actual or potential customers of the defendant for the kind of goods or services the defendant provides." The patient/debtor's status as a member of the public at large does not magically transform a notice-of-lien filing that does not propose a commercial transaction into commercial speech. If the intended audience is the public at large, actual or potential customers will be part of it — not because the message is directed to them as actual or potential customers and not because the message proposes a commercial transaction, but because customers comprise a subset of the general public. In the context of today's case, the patient/debtor's status as an actual customer holds no relevance to the medical provider's speech or conduct as a debt collector.
See id.
Under Castleman's analytical framework, the intended audience for the notice-of-lien filing is any third party who may be liable to the patient/debtor for the Covered Costs, not the actual or potential customers of the defendant for the kind of goods or services the defendant provides. Thus, the notice of lien does not satisfy the fourth Castleman requirement. Even under the majority's erroneous "included within the intended audience" legal standard, the debtor/patient, a first-party debtor, does not fall into the category of third parties who may be liable to the patient/debtor for the Covered Costs, and so the debtor/patient would not be "included within" the intended audience.
See id.
In sum, because Kilgore did not show that all four prongs of the Castleman test were satisfied, this court should hold that the TCPA's commercial-speech exemption does not apply in this case.
The Silver Lining
Today's decision to adopt the First Court of Appeals's fourth-prong "intended audience" analysis ensures this court's precedent aligns with that of our esteemed Houston sister court. Parting ways with the First Court would create a split of authority in the ten-county jurisdiction the First and Fourteenth Courts share, an unwelcome event every time it happens. Yet, at times, the better course is to choose the better rule even if it means creating a conflict within the courts' shared jurisdiction. Because the ink is barely dry on the First Court's analysis, released just last year, and because the First Court's reasoning goes against the supreme court's Castleman test, today is one of those times that the better course would be to forgo alignment and adopt the better reasoning. Though the Fourteenth does not do so, the court's decision carries a silver lining of sorts — achieving certainty and predictability in the law within the shared jurisdiction, a welcome event every time it happens.
See In re Platinum Energy Solutions, Inc. , 420 S.W.3d 342, 357 (Tex. App.—Houston [14th Dist.] 2014, orig. proceeding) (Frost, C.J., dissenting); Tucker , 405 S.W.3d at 715–18 (Frost, J., concurring).