                                                                                             ACCEPTED
                                                                                        01-14-00776-CV
                                                                              FIRST COURT OF APPEALS
                                                                                      HOUSTON, TEXAS
                                                                                   3/13/2015 5:36:40 PM
                                                                                    CHRISTOPHER PRINE
                                                                                                 CLERK


                      No. 01-14-00776-CV
   __________________________________________________________________
                                                            FILED IN
                                                       1st COURT OF APPEALS
                                                           HOUSTON, TEXAS
                       I T         C
                      N HE OURT OF PPEALS        A     3/13/2015 5:36:40 PM
                  F           F        D                 T
                  OR THE IRST ISTRICT OF EXASCHRISTOPHER A. PRINE
                                                               Clerk
   __________________________________________________________________

       Schlumberger Limited and Schlumberger Technology Corporation,
                                              Appellants/Cross-Appellees,
                                     V.

                        Charlotte Rutherford,
                                            Appellee/Cross-Appellant.
__________________________________________________________________

     On Appeal from the 127th Judicial District Court of Harris County, Texas
                         Trial Court Cause 2014-13621
   __________________________________________________________________

              CHARLOTTE RUTHERFORD’S REPLY BRIEF
                     AS CROSS-APPELLANT
   __________________________________________________________________

Joseph Y. Ahmad                            Thomas C. Wright
State Bar No. 0094100                      State Bar No. 22059400
Timothy C. Shelby                          Shelley J. White
State Bar No. 24037482                     State Bar No. 24056520
Adam Milasincic                            Raffi O. Melkonian
State Bar No. 24079001                     State Bar No. 24090587
AHMAD, ZAVITSANOS, ANAIPAKOS,              WRIGHT & CLOSE, LLP
ALAVI & MENSING P.C.                       One Riverway, Suite 2200
1221 McKinney Street, Suite 3460           Houston, TX 77056
Houston, Texas 77010                       Tel: 713-572-4321
                                           Fax: 713-572-4320
Richard B. Specter (pro hac vice)
California State Bar No. 114090            Counsel for Charlotte Rutherford
CORBETT, STEELMAN & SPECTER
18200 Von Karman Avenue, Suite 900
Irvine, California 92612
                                         TABLE OF CONTENTS

                                                                                                                         Page

TABLE OF CONTENTS ........................................................................................... 2
INDEX OF AUTHORITIES...................................................................................... 3
PRELIMINARY STATEMENT ............................................................................... 5
ARGUMENT ............................................................................................................. 6
I.       Schlumberger’s construction of the TCPA is contrary to its
         plain language. ................................................................................................. 6
         A.       The TCPA does not limit its protections to speech made
                  in a public setting. ................................................................................. 6
         B.        This Court has refused to require a nexus to participation
                   in government. ....................................................................................... 9
II.      Rutherford’s construction of the TCPA does not lead to absurd
         results. ............................................................................................................ 13
III.     The record does not include clear and specific evidence of each
         breach-of-contract element. ........................................................................... 16
CONCLUSION ........................................................................................................ 24
CERTIFICATE OF COMPLIANCE ....................................................................... 26
CERTIFICATE OF SERVICE ................................................................................ 27




                                                               2
                                    INDEX OF AUTHORITIES

                                                                                                                        Page
Cases
Avila v. Larrea, 394 S.W.3d 646 (Tex. App.—Dallas 2012, pet.
  denied) .................................................................................................................. 12
Better Bus. Bureau of Metro. Houston, Inc. v. John Moore Servs.,
  Inc., 441 S.W.3d 345 (Tex. App.—Houston [1st Dist.] 2013, pet.
  denied) ..............................................................................................................6, 10
Burkhart v. Burkhart, 960 S.W.2d 321 (Tex. App.—Houston [1st
  Dist.] 1997, writ denied) ...................................................................................... 15
Cheniere Energy, Inc. v. Lotfi, 449 S.W.3d 210 (Tex. App.—Houston
  [1st Dist.] 2014, no pet.) ....................................................................................... 10
City of Keller v. Wilson, 168 S.W.3d 802, (Tex. 2005) .......................................... 19
Combined Law Enforcement Ass’n of Tex. v. Sheffield, No. 03-13-
  00105-CV, 2014 WL 411672 (Tex. App.—Austin Jan. 31, 2014,
  pet. filed) (mem. op.) ............................................................................................ 10
Elliott v. Perez, 751 F.2d 1472 (5th Cir. 1985) ....................................................... 16
i4i Ltd. P’Ship v. Microsoft Corp., 598 F3d 831 (Fed. Cir. 2010) .......................... 13
In re Crown Castle Int’l Corp., 247 S.W.3d 349 (Tex. App.—Houston
  [14th Dist.] 2008, orig. proceeding) ..................................................................... 15
Litton Indus. Prods., Inc. v. Gammage, 668 S.W.2d 319 (Tex. 1984) .................... 20
Madariaga v. Morris, 639 S.W.2d 709 (Tex. App.—Tyler 1982, writ
  ref’d n.r.e.) ............................................................................................................ 22
Medina v. Tate, 438 S.W.3d 583 (Tex. App.—Houston [1st Dist.]
  2013, no pet.) ........................................................................................................ 10
Mekhail v. Duncan-Jackson Mortuary, Inc., 369 S.W.3d 482 (Tex.
  App.—Houston [1st Dist.] 2012, no pet.) ............................................................ 18
Paul E. Hawkinson Co. v. Dennis, 166 F.2d 61 (5th Cir. 1948) ............................. 13
Rankin v. McPherson, 483 U.S. 378 (1987) .............................................................. 8
Rivers v. Johnson Custodial Home, Inc., No. A-14-CA-484-SS, 2014
  WL 4199540 (W.D. Tex. Aug. 22, 2014) .............................................................. 7



                                                             3
Schimmel v. McGregor, 438 S.W.3d 847 (Tex. App.—Houston [1st
   Dist.] 2014, pet. filed) .......................................................................................... 13
St. Martin Evangelical Lutheran Church v. S. Dakota, 451 U.S. 772
   (1981) ..................................................................................................................... 9
Stafford v. S. Vanity Magazine, Inc., 231 S.W.3d 530 (Tex. App.—
   Dallas 2007, pet. denied) ...................................................................................... 22
Strom v. Memorial Hermann Hosp. Syst., 110 S.W.3d 216 (Tex.
   App.—Houston [1st Dist.] 2003, pet. denied) ..................................................... 15
Unigard Sec. Ins. Co. v. Schaefer, 572 S.W.3d 303 (Tex. 1978) ............................ 14
Whisenhunt v. Lippincott, 416 S.W.3d 689 (Tex. App.—Texarkana
   2013, pet. filed) ...................................................................................................... 7
Wright v. Wal-Mart Stores, Inc., 73 S.W.3d 552 (Tex. App.—
   Houston [1st Dist.] 2002, no pet.) ........................................................................ 20

Statutes
TEX. CIV. PRAC. & REM. CODE § 27.001............................................... 7, 8, 9, 12, 14
TEX. CIV. PRAC. & REM. CODE § 27.002....................................................... 9, 14, 16
TEX. CIV. PRAC. & REM. CODE § 27.003..................................................................12
TEX. CIV. PRAC. & REM. CODE § 27.005........................................................... 14, 24
TEX. CIV. PRAC. & REM. CODE § 27.010........................................................... 13, 14
U.S. CONST. art. I, § 8...............................................................................................12


Other Authorities
Antonin Scalia, A Matter of Interpretation: Federal Courts and the
 Law 31 (Amy Gutmann ed., 1997) ........................................................................ 6




                                                               4
TO THE HONORABLE JUSTICES OF THE COURT OF APPEALS:

      Charlotte Rutherford presents this reply brief in further support of her

request that the Court reverse the portion of the trial court’s order denying the

motion to dismiss as to the contract claim asserted by Schlumberger Limited and

Schlumberger Technology Corporation (collectively “Schlumberger”) and remand

this case to the trial court for (1) a determination of the amount of additional

attorney’s fees that are owed to Rutherford and (2) rendition of a final judgment in

Rutherford’s favor.

                       PRELIMINARY STATEMENT
      As established in Rutherford’s previous briefs, Schlumberger did not file this

lawsuit because some inexpensive thumb drives went missing. And Schlumberger

did not file false affidavits to support a temporary restraining order because it

believed Rutherford, a highly rated lawyer whom Schlumberger had employed for

almost seven years, was using trade secrets against it. Schlumberger filed this

lawsuit out of a desire to demean Rutherford’s reputation so as to derail the ‘319

patent-infringement case currently pending in federal court. Because Schlumberger

has no clear and specific evidence of any of the false and vindictive things it has

alleged against Rutherford, the entire case should have been dismissed.




                                         5
                                  ARGUMENT

I.    Schlumberger’s construction of the TCPA is contrary to its
      plain language.
      According to Schlumberger, the TCPA affords protection only to petitioning

and association activities that involve communications broadcasted publicly and

having some nexus to public policy. To find support for this position,

Schlumberger relies heavily on legislative history, dicta, and a concurring

opinion—essentially, everything but the words actually used in the TCPA. This is

not surprising because, under the plain meaning of the terms defining the TCPA’s

scope, Rutherford prevails. See Better Bus. Bureau of Metro. Houston, Inc. v. John

Moore Servs., Inc., 441 S.W.3d 345, 353 (Tex. App.—Houston [1st Dist.] 2013,

pet. denied) (stating that court’s primary objective in construing the TCPA is to

“give effect to the legislature’s intent by relying on the plain meaning of the text

adopted by the legislature.”) (emphasis added); see also Antonin Scalia, A Matter

of Interpretation: Federal Courts and the Law 31 (Amy Gutmann ed., 1997)

(recalling quip that “[o]ne should consult the text of the statute . . . only when the

legislative history is ambiguous,” and lamenting that joke is “no longer funny”

because “[r]eality has overtaken parody”).

       A.     The TCPA does not limit its protections to speech
              made in a public setting.
      Contrary to Schlumberger’s suggestion, the TCPA does not limit its

protections for association and petitioning activities only to communications made

                                          6
publicly. The Legislature could easily have restricted the TCPA’s application

based on who overhears the communication, but it did not. The Legislature chose

instead to define “communication” broadly to include any “statement or document

in any form or medium, including oral, visual, written, audiovisual, or electronic.”

TEX. CIV. PRAC. & REM. CODE § 27.001(1).

      The cases Schlumberger cites do not support its attempt to amend the

definition of a “communication” by adding the words “made in a public setting.”

See Whisenhunt v. Lippincott, 416 S.W.3d 689 (Tex. App.—Texarkana 2013, pet.

filed); Rivers v. Johnson Custodial Home, Inc., No. A-14-CA-484-SS, 2014 WL

4199540 (W.D. Tex. Aug. 22, 2014). Whisenhunt is based entirely on the express

statutory link between the right of free speech and matters of “public concern.” 416

S.W.3d at 696. There, the administrator of a medical partnership sent internal

emails criticizing one of the partners. Id. at 692–94. The partner sued for

defamation and tortious interference. Id. at 694. The administrator moved for

dismissal on the ground that his emails were protected by the right of free speech.

Id. at 694–95. Because the TCPA defines “free speech” to include only

communications “made in connection with a matter of public concern,” TEX. CIV.

PRAC. & REM. CODE § 27.001(3), the court inferred that private conversations

could never involve public concerns. 416 S.W.3d at 696.




                                         7
      The Whisenhunt court was mistaken to assume that private conversations

can never involve public concerns or enjoy constitutional protections. See, e.g.,

Rankin v. McPherson, 483 U.S. 378, 386–97 (1987) (finding that co-worker’s

remark to another employee about assassinating President Reagan was

constitutionally protected despite occurring in private workplace conversation).

Nevertheless, Whisenhunt is easily distinguished because it did not involve any

petitioning or association activity. The court considered only whether protected

speech was involved. Unlike the statutory definition of the “right of free speech,”

the definitions of the “right to petition” and “right of association” do not include

any limitation based on “matter[s] of public concern.” See TEX. CIV. PRAC. & REM.

CODE § 27.001(2)–(4). The Whisenhunt court itself recognized this key distinction,

observing that it would not have reached the same result in a “right to petition”

case. 416 S.W.3d at 699 n.14.

      Rivers, an unpublished decision of a federal district court, is also no help to

Schlumberger. 2014 WL 4199540, at *2. That case, like Whisenhunt, involved

only the “free speech” prong of the TCPA. And the federal district court followed

Whisenhunt because the defendants “made no effort to respond to its holding or

reasoning, or to distinguish it.” Id.

      To the extent Whisenhunt or Rivers can be read as anything more than

specific applications of free speech issues, Rutherford respectfully submits the


                                         8
cases were wrongly decided in light of the TCPA’s plain text. Not a single word in

the statute suggests that free speech—let alone petitioning or free association—is

protected only if made in a public setting. See TEX. CIV. PRAC. & REM. CODE

§ 27.001(2)–(4).

       B.    This Court has refused to require a nexus to
             participation in government.
      Schlumberger is correct that the TCPA states its 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.” TEX. CIV. PRAC. & REM. CODE § 27.002. But Schlumberger is

incorrect that this general statement of purpose overrides section 27.001’s precise

definitions of the “right to petition” and “right of association.” See St. Martin

Evangelical Lutheran Church v. S. Dakota, 451 U.S. 772, 791 n.19 (1981)

(observing that general statements of legislative purpose “cannot defeat the

specific and clear wording of a statute”). Applying the appropriate rules of

statutory construction and recognizing that the clear text of section 27.001 expands

the common-law definitions of petitioning and association, this Court already has

rejected Schlumberger’s argument:

            [Appellee’s] interpretation places great weight on the
            words “and otherwise participate in government” as a
            limitation on the preceding list of “constitutional rights”
            that the statue is intended to “encourage and safeguard.”
            But this interpretation would render completely

                                         9
             meaningless the references to the constitutional rights to
             “speak freely” and “associate freely,” if neither adds any
             additional meaning to the protection of the constitutional
             right “to petition” and to “otherwise participate in
             government.”

Better Bus. Bureau, 441 S.W.3d at 353 (internal citations omitted); accord

Combined Law Enforcement Ass’n of Tex. v. Sheffield, No. 03-13-00105-CV,

2014 WL 411672, at *2 n.1 (Tex. App.—Austin Jan. 31, 2014, pet. filed) (mem.

op.) (stating that text of TCPA does not limit its scope).

      The court’s opinion in Cheniere Energy, Inc. v. Lotfi does not change

anything. 449 S.W.3d 210, 216 (Tex. App.—Houston [1st Dist.] 2014, no pet.). In

that case, a different panel of this Court observed that the TCPA requires some

nexus between “the communication used to invoke the TCPA and general

parameters of First Amendment protection” without differentiating or even citing

Better Business Bureau. See 449 S.W.3d 210, 216 (Tex. App.—Houston [1st Dist.]

2014, no pet.). Better Business Bureau cannot be overturned absent a decision of

the Court sitting en banc or a material change in the statute, neither of which has

occurred here. See Medina v. Tate, 438 S.W.3d 583, 588 (Tex. App.—Houston

[1st Dist.] 2013, no pet.) (“Absent a decision from a higher court or this court

sitting en banc that is on point and contrary to the prior panel decision or an

intervening and material change in the statutory law, this court is bound by the

prior holding of another panel on this court.”).


                                          10
      Moreover, Cheniere Energy’s statement regarding a nexus requirement is

dicta. That appeal arose from an in-house lawyer’s suit against her former

employer and several co-workers for retaliatory firing. 449 S.W.3d at 211. The

trial court denied the co-workers’ motion to dismiss tortious interference claims

under the TCPA. Id. at 212. In deciding whether the co-workers met their burden

to show the TCPA applied, the Court noted that the co-workers did not file any

affidavits or other evidence establishing a communication that qualified for

protection under the TCPA; instead, they relied exclusively on the factual

allegations in the petition. Because those factual allegations supported more than

one equally plausible conclusion, the Court concluded the co-workers did not

satisfy their burden. Id. at 213–15. Accordingly, the Cheniere Energy holding

concerns the sufficiency of the pleadings and evidence, not the nature of the

communication. Id.

      Contrary to Schlumberger’s assertion, the issue for this Court is not whether

Rutherford’s activities are protected by the United States or Texas Constitutions.

The issue is whether Rutherford exercised rights protected by the TCPA. Had it

wanted to, the Legislature could have written the TCPA to apply only whenever a

lawsuit is based on a party’s exercise of constitutional rights, making the statute’s

scope co-extensive with First Amendment doctrine. But the Legislature did not

write that statute. Instead it chose to cover any legal action that is based on, relates


                                          11
to, or is in response to the party’s exercise of (1) the right of free speech; (2) the

right to petition; or (3) the right of association. See TEX. CIV. PRAC. & REM. CODE

§ 27.003. All three of these terms have statutory definitions considerably broader

than what constitutional law may have otherwise covered. See id. § 27.001(2)–(4).

And it makes sense that the Legislature would not want to hinge the TCPA’s

meaning or applicability on ever-evolving concepts of constitutional law.

      If the Court disagrees, however, any standard requiring a communication on

a matter of “public concern” is satisfied here. The TCPA makes clear that “a good,

product, or service in the marketplace” is a matter of “public concern.” TEX. CIV.

PRAC. & REM. CODE § 27.001(7)(E). Dynamic 3D’s lawsuit, and Rutherford’s

alleged communications, relate to Dynamic 3D’s ‘319 patent and Schlumberger’s

Petrel software. The Petrel software is a product or service in the marketplace and

thus qualifies as a “public concern.”See id.; see also Better Bus. Bureau, 441

S.W.3d at 353–54 (review of home repair service was “public concern” under the

TCPA); Avila v. Larrea, 394 S.W.3d 646, 655 (Tex. App.—Dallas 2012, pet.

denied) (attorney’s legal services involved “public concern” under TCPA).

Moreover, Dynamic 3D’s patent rights are a public concern as a matter of

constitutional law, see U.S. CONST. art. I, § 8, cl. 8, and “it is the public interest

which is dominant in the patent system.” Mercoid Corp. v. Mid-Continent Inv. Co.,

320 U.S. 661, 665 (1944); see also i4i Ltd. P’Ship v. Microsoft Corp., 598 F3d


                                         12
831, 863 (Fed. Cir. 2010) (patent suits implicate public interests of consumers,

licensees, and manufacturers), aff’d, 131 S. Ct. 2238 (2011); Paul E. Hawkinson

Co. v. Dennis, 166 F.2d 61, 63 (5th Cir. 1948) (“[T]his is a patent suit and as such

there is a public interest involved . . . .”).1

II.      Rutherford’s construction of the TCPA does not lead to
         absurd results.
         Schlumberger suggests that Rutherford’s views of the petitioning and

association activities protected by the TCPA “abrogate or substantially undermine

longstanding Texas statutory and common law remedies for tortious and unlawful

conduct.” (Cross-Apes. Br. at 40) According to Schlumberger, a broad definition

of the right to petition the courts will bring all malicious prosecution and

abuse-of-process claims within the scope of the TCPA, which the Legislature

could not have intended. And a broad definition of the “right of association” will

allow defendants to escape liability for violations of the Texas’s Free Enterprise

and Antitrust Act of 1983, the Insurance Code, and anti-discrimination laws—also

something not intended by the Legislature. These arguments are red herrings.


1
      Schlumberger also contends the commercial-activity exception stated in section 27.010(b)
      removes this case from the protection of the TCPA. Schlumberger made this same argument
      in its brief as appellant, and Rutherford’s previous response explains that the exception does
      not apply because the communications at issue do not arise out of the sale or lease of goods,
      services, or an insurance product. See TEX. CIV. PRAC. & REM. CODE § 27.010(b). Moreover,
      the intended audience for Rutherford’s communications was either her employer or the
      federal court, not the buyers and customers protected by the exception. See id., Schimmel v.
      McGregor, 438 S.W.3d 847, 857–58 (Tex. App.—Houston [1st Dist.] 2014, pet. filed). For
      the purpose of this reply, Rutherford incorporates the arguments in her brief as appellee by
      reference. (Ape. Br. at 44–46)

                                                 13
      Again, the best expression of the Legislature’s intent is “the plain meaning

of the text adopted.” Better Bus. Bureau, 441 S.W.3d at 353. To prevent retaliatory

games like the one Schlumberger is playing here, the TCPA applies to any “cause

of action” filed “in response to” protected conduct. TEX. CIV. PRAC. & REM. CODE

§§ 27.001(6), 27.002, 27.005(b). The TCPA does not contain any provision that

states only certain claims are subject to its protection. Quite the opposite, it applies

to any “legal action” that implicates the rights defined by the statute. Id.

§ 27.003(a). Where the Legislature intended to exempt specific causes of action

from the TCPA’s all-encompassing scope, it did so expressly. Id. § 27.010(c)–(d)

(exempting all claims for personal injury, wrongful death, survival, and related to

insurance).

      The Legislature already addressed Schlumberger’s concerns about insurance

cases by expressly excluding all actions brought under the Insurance Code or

arising out of an insurance contract from the TCPA. Id. § 27.010(d). But the other

claims for which Schlumberger feigns concern are not listed among the causes of

action exempt from the TCPA’s protections. Id. That omission must be considered

intentional. See Unigard Sec. Ins. Co. v. Schaefer, 572 S.W.3d 303, 307 (Tex.

1978) (“When specific exclusions or exceptions to a statute are stated by the

Legislature, the intent is usually clear that no others shall apply.”).




                                           14
       Not only are the claims Schlumberger warns about missing from the TCPA’s

stated exemptions, but they are also missing from this lawsuit. This lawsuit does

not involve any claims for violation of the State’s antitrust, anti-discrimination, or

insurance laws. And there is no claim for malicious prosecution or abuse of

process. The only claim Rutherford is asking this Court to consider is

Schlumberger’s breach of contract claim, which, for all the reasons stated in

Rutherford’s briefing and pursuant to Schlumberger’s clear admission,

Schlumberger filed in response to Rutherford’s decision to associate with a new

company for the purpose of enforcing its patent portfolio and her perceived role in

a subsidiary company’s patent-infringement suit.2

       Moreover, Schlumberger misses a broader point. The TCPA does not

insulate any tortfeasor or wrongdoer from liability. It simply adds an additional

layer of procedural protection.3 All of the claims Schlumberger has singled out as

2
    The pleadings and evidence establish that Schlumberger began preparations for this
    retaliatory suit only three days after the ‘319 patent litigation was filed. (Compare 1 CR 270,
    with 1 CR 284–86). In its own petition, Schlumberger acknowledged targeting Rutherford
    “as a result of [the ‘319 patent] litigation,” and, in interrogatory answers, again confessed
    that it did not make any accusations of theft against Rutherford “until a lawsuit was filed
    against Schlumberger.” (1 CR 15; 2 CR 505)
3
    The law incorporates numerous other procedural and substantive hurdles that still allow
    meritorious claims to proceed. See, e.g., In re Crown Castle Int’l Corp., 247 S.W.3d 349, 354
    (Tex. App.—Houston [14th Dist.] 2008, orig. proceeding) (discussing heightened,
    substantive pleading requirement for derivative suits under Delaware law); Strom v.
    Memorial Hermann Hosp. Syst., 110 S.W.3d 216, 227 (Tex. App.—Houston [1st Dist.] 2003,
    pet. denied) (discussing “heavy” burden on medical malpractice plaintiffs to comply with
    very specific requirements for expert reports and severe sanctions for failure to comply);
    Burkhart v. Burkhart, 960 S.W.2d 321, 323 (Tex. App.—Houston [1st Dist.] 1997, writ
    denied) (discussing elevated proof requirements in certain child-custody-modification
                                                15
being at risk for extinction may still be asserted so long as they are supported by

clear and specific evidence. See TEX. CIV. PRAC. & REM. CODE § 27.002

(explaining that statute allows “meritorious lawsuits for demonstrable injury” to

proceed even if the suit implicates protected rights). If the TCPA did create a

liability shield for entire classes of torts or statutory violations, perhaps

Schlumberger’s arguments would make more sense. Because the TCPA is not a

liability shield, however, Schlumberger’s argument has no more support in logic

than it does in the statute’s text.

III.   The record does not include clear and specific evidence of
       each breach-of-contract element.
       The parties have offered competing interpretations of the TCPA’s “clear and

specific evidence” standard.4 To resolve this appeal, however, the Court need not

decide which interpretation is correct. Even if circumstantial evidence is

considered, Schlumberger failed to prove a prima facie case of breach of contract.




    proceedings); Elliott v. Perez, 751 F.2d 1472, 1476–82 (5th Cir. 1985) (discussing elevated
    burdens in federal immunity cases).

4
    Schlumberger argues any construction of the TCPA that excludes circumstantial evidence
    runs afoul of the Texas Constitution’s open-courts provision. Schlumberger made this same
    argument in its brief as appellant. As stated in Rutherford’s previous response, the “clear and
    specific evidence” standard hardly creates an impossible condition that would violate the
    Texas Constitution, and at least one Texas court already has considered and rejected
    Schlumberger’s argument. See Combined Law Enforcement Ass’n of Tex., 2014 WL
    411672, at *10. For the purpose of this reply, Rutherford incorporates the arguments in her
    brief as appellee by reference. (Ape. Br. at 49–52)

                                                16
      Schlumberger contends that part of the trial court’s order refusing to dismiss

the contract claim must be affirmed because Schlumberger presented clear and

specific evidence that:

       Rutherford breached the confidentiality agreement by “delet[ing] files,
        including numerous files whose names clearly signify IP content, from
        her company-issued laptop.” (Cross-Apes. Br. at 65)

       Rutherford breached the confidentiality agreement by “fail[ing] to return
        drives containing confidential Schlumberger trade secrets.” (Id.)

       Schlumberger is entitled to “monetary compensation” because it owned
        the drives Rutherford failed to return. (Id. at 69)

       Schlumberger is entitled to “specific performance of the confidentiality
        agreement to have its devices and information returned.” (Id.)

When the evidence offered by Schlumberger to support each of these allegations is

reviewed carefully, however, the holes in Schlumberger’s case are apparent.

      First, Schlumberger has not presented any specific evidence explaining

whether the alleged “deletions” from Rutherford’s company-issued laptop resulted

in the actual loss of information. Cowen discerned the names of the items

“deleted,” but his affidavit does not state that the alleged deletion was anything

more than sending those items to a recycling bin where they could be recovered.

(4 CR 1341) Schlumberger’s own Executive IT Support person explained that

Schlumberger’s “auto backup” system stored the contents of Rutherford’s laptop to

Schlumberger’s server every day. (4 CR 1209) If the files on Rutherford’s laptop

were stored on the company server or could otherwise be recovered, then the

                                        17
alleged deletions are not a breach of the confidentiality agreement that has resulted

in harm warranting damages. Nor is it a reasonable construction of a standard

employee confidentiality agreement that an employee breaches that agreement

every time she deletes a file from her computer. See Mekhail v. Duncan-Jackson

Mortuary, Inc., 369 S.W.3d 482, 485 (Tex. App.—Houston [1st Dist.] 2012, no

pet.) (observing that, under de minimus non curat lex doctrine, “law does not care

for, or take notice of, very small or trifling matters”).

       Second, Schlumberger’s allegation that the failure to return electronic

storage devices constitutes a breach resulting in damages has even greater proof

problems. In the trial court, Schlumberger placed much emphasis on Rutherford’s

interrogatory answer that she still possesses one USB drive that she plugged into a

Schlumberger computer. (6 CR 2045) As explained fully in Rutherford’s opening

brief, Rutherford supplied a forensic image of that drive to Schlumberger’s

attorneys. (Cross-Ant. Br. at 33-34) Because the drive contains nothing more than

Rutherford’s personal photographs, it is not surprising that Schlumberger has

abandoned its emphasis on Rutherford’s possession of the drive on appeal. (6 CR

2045) To distract from the absence of clear and specific evidence of monetary

damages,5 Schlumberger has argued it is entitled to specific performance for the


5
    Moreover, Rutherford’s interrogatory states that she does not recall whether the USB drive
    was even issued to her by Schlumberger or was one of her personal drives. (6 CR 2045)
    Schlumberger knows the serial number of the USB drive that Rutherford possesses, but
    Schlumberger never supplied any receipt, purchase order, or other evidence to prove that the
                                              18
return of electronic storage drives containing confidential information. A drive

that, without dispute, contains no trade secrets or other confidential information

does not advance Schlumberger’s specific-performance argument.

       Instead, the primary evidence Schlumberger cites to support its allegation

that Rutherford breached the confidentiality agreement by removing the drives

from its facility are witness statements that Schlumberger could not find the drives

where Rutherford testified she left them. (4 CR 1406–07, 1414, 1431–32) But that

evidence is not clear or specific evidence of breach of the confidentiality

agreement. The evidence requires the Court to pile inference upon unsubstantiated

inference: Because Rutherford used the drives at work, the drives must have been

purchased by Schlumberger; because Lennon could not find the USB drives on her

desk and Nava could not find the external hard drive in her desk drawer,

Rutherford must have taken the drives; because the drives were missing, the only

place Rutherford could have put them is somewhere outside of Schlumberger’s

facility.

       This stacking of threadbare inferences is not permitted under Texas law. See

City of Keller v. Wilson, 168 S.W.3d 802, 813–14 (Tex. 2005) (stating that

competing inferences and stacked inferences are no evidence). Schlumberger

   USB drive ever belonged to Schlumberger, as opposed to being purchased by Rutherford to
   store her personal photos. In other words, Schlumberger failed to provide any evidence—let
   alone the required clear and specific evidence—that any USB drive in Rutherford’s
   possession was Schlumberger-owned “equipment” that, under her confidentiality agreement,
   had to be returned.
                                            19
cannot stack inference upon implausible inference and claim to have satisfied any

evidentiary standard—let alone the “clear and specific evidence” standard—to

support its conclusion that, simply because it could not find a few electronic

storage drives, Rutherford loaded the devices with Schlumberger’s trade secrets

and took them to Acacia.

       To reach the conclusion urged by Schlumberger, this Court also must ignore

numerous other, more probable conclusions to the contrary: Schlumberger lost the

materials in the nine months between when Rutherford left the company and when

Schlumberger began looking for the materials;6 Schlumberger did not look hard for

the materials; someone else took the materials; or finding a few unlabeled portable

drives at a technology conglomerate’s headquarters is akin to finding a needle in a

haystack. Texas law prohibits that. See, e.g., id.; Litton Indus. Prods., Inc. v.

Gammage, 668 S.W.2d 319, 324 (Tex. 1984) (refusing to credit “meager

circumstantial evidence giving rise to inferences which are equally consistent”);

Wright v. Wal-Mart Stores, Inc., 73 S.W.3d 552, 555 (Tex. App.—Houston [1st

Dist.] 2002, no pet.).




6
    Robin Nava, who took over Rutherford’s office, stated that “[t]here was no external hard
    drive in the file cabinets, drawers, or anywhere else in Ms. Rutherford’s former office.” (4
    CR 1414) This begs the question: If the external storage devices contained confidential
    information and trade secrets and Nava did not find the drive when she moved into the office
    immediately after Rutherford’s departure, why did Schlumberger wait so long to look for the
    drive?

                                              20
       Third, Schlumberger gives short shrift to the issue of monetary damages.

According to Schlumberger, two items of evidence establish that it is entitled to

recover monetary damages for the loss of its physical storage drives: (1) Lennon’s

statement that she gave Rutherford multiple USB drives and (2) DeLeon’s

statement that he gave Rutherford a portable hard drive.7 (1 CR 73, 76, 200) But

Lennon did not even know how many USB drives she gave Rutherford, and

Lennon’s deposition testimony does not indicate that she had any way of knowing,

for example, through tracking of serial numbers, which drives were purchased by

Schlumberger. (1 CR 263-67) The record does not contain any receipt or invoice

evidencing Schlumberger’s purchase of the drives or their cost. Thus, contrary to

Schlumberger’s assertions, there is no evidence that Schlumberger is entitled to

monetary damages for loss of the devices in question, much less that those

years-old devices retain any monetary value that would entitle Schlumberger to

replacement costs.



7
    DeLeon’s affidavit, submitted in support of Schlumberger’s ex parte request for a TRO,
    states that he gave Rutherford an external hard drive in 2013, which the company purchased
    in 2011. (1 CR 73) DeLeon’s statements about the external hard drive were discredited,
    however, when he testified later that he supplied the external hard drive to Rutherford in
    2011—two years earlier than stated in his affidavit. (1 CR 296–98) Under oath at his
    deposition, DeLeon explained that he performed a backup of Rutherford’s Personal Storage
    Table files—which are used in connection with Microsoft Outlook to store email messages—
    to the external hard drive in 2011. (1 CR 296-99) But, contrary to his affidavit, DeLeon did
    not transfer anything from Rutherford’s company-issued laptop to an external storage device
    in 2012 or 2013. (1 CR 297) Also contrary to his affidavit, DeLeon conceded having no
    personal knowledge of whether Rutherford downloaded confidential information onto USB
    drives even though he stated in his affidavit that she had done so. (1 CR 73, 301)
                                              21
       Fourth, under the authorities cited by Schlumberger, its alternative request

for specific performance for return of the drives is viable only if monetary damages

would be insufficient to remedy the alleged breach. See, e.g., Madariaga v. Morris,

639 S.W.2d 709, 711 (Tex. App.—Tyler 1982, writ ref’d n.r.e.); Stafford v. S.

Vanity Magazine, Inc., 231 S.W.3d 530, 536 (Tex. App.—Dallas 2007, pet.

denied). Schlumberger has not proven, or even argued, that it could not be made

whole for any alleged breaches by an award of monetary damages. (Cross-Apes.

Br. at 64) But even if Schlumberger had made that showing, specific performance

necessarily depends on clear and specific evidence that the lost drives contain trade

secrets.8 To identify the information Rutherford allegedly saved on the drives,

Schlumberger relies exclusively on Cowen’s opinion that Rutherford connected a

number of portable storage drives to her company-issued laptop and viewed certain

files before leaving Schlumberger. (4 CR 1334 et seq.)

       But, again, simply because Rutherford accessed the files does not support a

conclusion that she was trying to steal confidential information. This evidence

would support a number of equally probable conclusions to the contrary—the first

being that Rutherford accessed the files at a time when she was still employed by

Schlumberger and had a business purpose for doing so. The business purpose is


8
    For all the reasons stated in Rutherford’s brief as appellee, there is no clear and specific
    evidence that Rutherford actually took any trade secrets from Schlumberger on portable
    storage drives. (Ape. Br. at 53–60)

                                              22
obvious—Rutherford downloaded thousands of files to prepare Robin Nava, her

successor, to take over. And it is undisputed that Nava received those files on a

drive left by Rutherford. (3 CR 1204; 4 CR 1416, 1592, 1597; 6 CR 2045) It is not

surprising that Schlumberger relegates this important fact to a footnote in its brief.

(Cross-Apes. Br. at 9 n.6) Rutherford’s tremendous effort to set Nava up for

success in her new role as Schlumberger’s senior intellectual property attorney is

entirely inconsistent with Schlumberger’s attempt to portray Rutherford, who was

consistently rated by Schlumberger as an outstanding performer, as a thief. (1 CR

249–62, 290–91)

      In addition, Cowen’s findings are reasonably explained by Rutherford’s

interrogatory statements that she used another USB drive to retrieve her Outlook

contacts and iTunes files from her company-issued laptop. (6 CR 2045) Rutherford

stated that she accessed the Schlumberger laptop to place personal files—financial

information, a draft Acacia press release, and draft job descriptions for a potential

Acacia Research energy team—on one or more USB drives. (6 CR 2045)

Schlumberger’s own Executive IT Support person, DeLeon, acknowledged that

employees often back up their personal information before leaving the company.

(1 CR 313)

      On this record it is impossible to discern—absent impermissible leaps in

logic—any breach of the confidentiality agreement that caused harm. An analogy


                                         23
makes this point plain. In a pivotal moment in Daniel Defoe’s Robinson Crusoe,

the protagonist Crusoe is surprised to discover a single footprint in the sand.

Crusoe could reasonably infer that he was not alone on the island. But if

Schlumberger had authored the novel, Crusoe would exceed the limits of rational

inference to conclude, without more, the footprint belonged to the man Friday.

      Because Schlumberger did not “establish[ ] by clear and specific evidence a

prima facie case for each essential element of the” breach of contract claim, the

trial court erred in failing to dismiss that claim along with Schlumberger’s other

claims. See TEX. CIV. PRAC. & REM. CODE § 27.005. That part of the trial court’s

order denying Rutherford’s motion to dismiss with respect to the contract claim

should be reversed.

                                 CONCLUSION
      For all the reasons stated above and in Rutherford’s other briefs, this Court

should affirm in part the judgment of dismissal and the award of fees and

sanctions, and should reverse only the portion of the trial court’s order denying the

anti-SLAPP motion to dismiss as to the contract claim asserted by Schlumberger

and remand this case to the trial court for (1) a determination of the amount of

additional attorney’s fees and sanctions that are owing Rutherford and (2) rendition

of judgment in Rutherford’s favor.




                                         24
Respectfully submitted,

/s/ Thomas C. Wright
Thomas C. Wright
State Bar No. 22059400
Shelley J. White
State Bar No. 24056520
Raffi O. Melkonian
State Bar No. 24090587
WRIGHT & CLOSE, L.L.P.
One Riverway, Suite 2200
Houston, TX 77056
(713) 572-4321
(713) 572-4320 (Facsimile)
wright@wrightclose.com
white@wrightclose.com
melkonian@wrightclose.com

Joseph Y. Ahmad
State Bar No. 00941100
Timothy C. Shelby
State Bar No. 24037482
Adam Milasincic
State Bar No. 24079001
AHMAD, ZAVITSANOS, ANAIPAKOS, ALAVI &
MENSING P.C.
1221 McKinney Street, Suite 3460
Houston, Texas 77010
(713) 655-1101
(713) 655-0062 (Facsimile)
joeahmad@azalaw.com
tshelby@azalaw.com
amilasincic@azalaw.com




 25
                                      Richard B. Specter (admitted pro hac vice)
                                      California State Bar No. 114090
                                      CORBETT, STEELMAN & SPECTER
                                      18200 Von Karman Avenue, Suite 900
                                      Irvine, CA 92612
                                      (949) 553-9266
                                      (949) 553-8454 (Facsimile)
                                      rspecter@corbsteel.com

                                      Counsel for Charlotte Rutherford




                    CERTIFICATE OF COMPLIANCE
      I certify that this Brief as Appellant complies with the typeface and word-
count requirements set forth in the Rules of Appellate Procedure. This Brief has
been prepared, using Microsoft Word, in 14-point Iskoola Pota font for the text and
12-point Iskoola Pota font for any footnotes. This Brief contains 5,048 words, as
determined by the word count feature of the word processing program used to
prepare this document, excluding those portions of the notice exempted by TEX. R.
APP. P. 9.4(i)(1).


                                      /s/ Shelley J. White
                                      Shelley J. White




                                        26
                        CERTIFICATE OF SERVICE
      I certify delivering a true and complete copy of this instrument to all counsel
of record for appellants/cross-appellees, Schlumberger Limited and Schlumberger
Technology Corporation, electronically on March 13, 2015, in compliance with the
Texas Appellate Rules of Civil Procedure:

Sean D. Jordan                             Craig Smyser
Kent C. Sullivan                           Land Murphy
Danica L. Milios                           Justin Waggoner
Peter C. Hansen                            SMYSER KAPLAN & VESELKA, LLP
SUTHERLAND ASBILL & BRENNAN LLP            700 Louisiana Street, Suite 2300
600 Congress Avenue, Suite 2000            Houston, Texas 77002
Austin, Texas 78701                        csmyser@skv.com
sean.jordan@sutherland.com                 lmurphy@skv.com
                                           jwaggoner@skv.com


                                       /s/ Shelley J. White
                                       Shelley J. White




                                         27
