On April 24, 2015, the Texas Supreme Court issued a per curiam opinion clarifying the evidentiary standards that will govern the application of the Texas Citizens Participation Act ("Act"). The Court balanced the need for open and vigorous discussion of important public issues--such as hydraulic fracturing--against a litigant's right to defend itself against unwarranted attacks. The law enacted in 2011, writes the Court, "protects citizens who petition or speak out on matters of public concern from retaliatory lawsuits that seek to intimidate or silence them". If a lawsuit amounts to an attempt to stifle a defendant's ability to communicate to the public on a matter of public concern, the trial court's duty under the Act is to dismiss the lawsuit unless the plaintiff's "prima facie case" is supported by "clear and specific evidence"--a complicated formulation for the courts to administer. The case is In re: Steven Lipsky.
Hydraulic fracturing and its consequences are an important matter of public concern, and lies at the heart of the Court's unanimous ruling in the case of In re: Steven Lipsky. Steven Lipsky and his wife Shyla own several acres in North Texas, in somewhat close proximity to the hydraulic fracturing operations of Range Resources. They made public complaints about their contaminated well water, for which they blamed the operations of Range Resources. They filed a lawsuit against Range Resources, and alleged that Range Resources was negligent, grossly negligent and that its operations constituted a nuisance. Range Resources then filed a counterclaim, alleging defamation, business disparagement and a civil conspiracy between Shyla Lipsky and an environmental consultant working with her.
Both EPA and the Texas Railroad Commission became involved in this controversy, but the EPA withdrew its complaint against Range Resources while the Railroad Commission looked into the complaint and could find no link between the hydraulic fracturing operations and the Lipsky's contaminated well water.
The Lipskys invoked the to seek dismissal of the counterclaim, which the trial court denied. However, an intermediate state court of appeals agreed that the law required the dismissal of the counterclaim. Because the Act had been accorded conflicting interpretations by various state courts of appeals, the Texas Supreme Court used this case to clarify the evidentiary standards imposed by the new law. Briefly, the Court held that evidence of clear and specific evidence may be supported by relevant circumstantial evidence, and that meritorious lawsuits cannot be dismissed simply because of a lack of direct, not circumstantial evidence. Applying this standard, the Texas Supreme Court agreed that Range Resources' allegations against Shyla Lipsky and their consultant must be dismissed, but the separate complaint against Steven Lipsky could proceed to trial.