The Supreme Court of Texas has declined to consider a man’s claim that his defamation case against Baylor University, the school’s President, regents, and legal counsel should be arbitrated. In Colin Shillinglaw v. Baylor University, Et al., No. 18-0709, Baylor University hired a man, Shillinglaw, to be the school’s Director for Football Operations. Several years later, the school hired a law firm, Pepper Hamilton, to investigate sexual harassment and assault allegations that were brought against both the school and its football program. Not long after Pepper Hamilton completed its investigation, Shillinglaw was terminated.
Following his separation from the university, Shillinglaw filed a defamation and libel lawsuit against Baylor, several of the school’s officials, and Pepper Hamilton in Dallas County, Texas. Each defendant responded to the case by filing a motion to dismiss based on the Texas Citizens’ Participation Act (“TCPA”). In addition, the defendants asked the trial court to award them legal fees. Shillinglaw then filed a request for nonsuit, which the court granted.
Next, Shillinglaw filed a similar lawsuit against Baylor University in McLennan County, Texas. In that case, Shillinglaw asked the court to order the dispute to arbitration based on the man’s employment contract with the university. In addition, Shillinglaw responded to the defendants’ motion to dismiss in Dallas County but failed to request arbitration. Ultimately, the Dallas County court granted the defendants’ motion to dismiss the case with prejudice and issued an award for costs and legal fees. After that, Shillinglaw sought review by the Fifth District Court of Appeals in Dallas.
On appeal, Shillinglaw maintained that the “trial court erred by failing to order the claims to arbitration,” argued “the FAA preempts the TCPA because, as applied here, the TCPA discriminated against arbitration,” and claimed “the trial court’s award of attorney’s fees to appellees was unreasonable.”
In a memorandum opinion, the appellate court first addressed Shillinglaw’s claim “that although only Shillinglaw and Baylor are signatories to the arbitration agreement at issue, the remaining non-signatory appellees should also be compelled to arbitration.” The Dallas court stated an agreement to arbitrate is a matter of contract and non-signatories to an agreement such as the defendant university officials and the school’s legal counsel may only be “allowed or required to arbitrate if rules of law or equity would apply the contract to them generally.” After examining the record, the Fifth District concluded the non-signatories could not be compelled to arbitration.
After that, the Court of Appeals held Shillinglaw waived his right to arbitration because he “failed to effectively present his request for arbitration to the Dallas County court.” The court added:
At the hearing on appellees’ motions to dismiss, Shillinglaw made an oral request to refer the case to arbitration, not a written motion required by the FAA. See 9 U.S.C. § 4, 6. In fact, the first time Shillinglaw made a written motion requesting the Dallas County court compel arbitration was in his motion to reconsider, which he filed after he non-suited his claims and after the trial court signed orders granting appellees’ motions to dismiss his claims with prejudice. Therefore, by the time Shillinglaw requested that the trial court compel his claims to arbitration, he had already voluntarily non-suited his claims against appellees and thus the trial court lacked jurisdiction to compel those claims to arbitration. See City of Dallas v. Albert, 354 S.W.3d 368, 375 (Tex. 2011) (jurisdiction as to claim lost when claim timely non-suited); Patton Boggs LLP v. Moseley, 394 S.W.3d 565, 572 (Tex. App.—Dallas 2011, no pet.) (“Because the only proceeding before the trial court was a rule 202 petition, the trial court had no jurisdiction to grant a motion to compel arbitration absent an agreement between the parties that the motion should be granted.”). He also failed to seek arbitration in the trial court until after an adverse result. See Haddock v. Quinn, 287 S.W.3d 158, 180 (Tex. App.—Fort Worth 2009, pet. denied) (“Indeed, failing to seek arbitration until after proceeding in litigation to an adverse result is the clearest form of inconsistent conduct and is inevitably found to constitute substantial invocation of the litigation process resulting in waiver.”).
Next, the appellate court stated it did not need to address Shillinglaw’s preemption claims due to the man’s failure “to effectively present his request for arbitration.” Finally, the Fifth District held the case record did not support Shillinglaw’s assertion that “the trial court abused its discretion in its award of attorney’s fees, court costs, and litigation expenses to appellees,” before affirming the Dallas County trial court’s order in the case.
I. Did the Fifth Court Appeals correctly hold that Shillinglaw waived arbitration without determining if Shillinglaw’s alleged delay prejudiced Respondents within the first three months of litigation?
II. In a matter of first impression in Texas, does the Federal Arbitration Act preempt the Texas Citizens Participation Act if an application of the Texas Citizens Participation Act disfavors arbitration agreements in direct contravention of the holding in Kindred Nursing Centers Ltd. v. Clark, 137 S. Ct. 1421 (2017)?
III. Did the Fifth Court of Appeals err by failing to address whether its application of the TCPA discriminated against arbitration?
IV. Can a signatory to an arbitration agreement (Shillinglaw) compel the agents (Pepper Hamilton and the Baylor Regents) of another signatory (Baylor) to arbitration?
V. Is the trial court’s order granting nonmonetary sanctions void because the trial court lacked jurisdiction to grant such relief under the TCPA?
VI. Did the Fifth Court of Appeals erroneously affirm an unreasonable award of attorney fees for duplicative, excessive, and inadequately documented work by counsel for multiple parties in violation of El Apple I, Ltd. v. Olivas, 370 S.W.3d 757 (Tex. 2012)?
On September 14th, the Texas Supreme Court declined to consider the case without additional comment.