H-E-B appeals case to top state court
Grocer tangling with industrial supply firm over defamation, breach of contract claims
Having failed to convince two courts to dismiss business disparagement and defamation claims against it, H-E-B has appealed to the Texas Supreme Court.
The San Antonio grocer has framed the appeal as a fight to “protect its right to free speech.”
H-E-B and Maverick International Ltd. have been battling for nearly two years in state courts in Bexar and Jefferson counties over disinfectant wipes — known as Bioerase — the grocer sought for its stores from the Beaumont industrial supply company as the coronavirus spread in 2020.
The retailer sued first in March 2021 in Bexar County, alleging Maverick failed to deliver hundreds of thousands of canister units of the wipes.
Maverick responded five days later by suing H-E-B in Jefferson County for breach of contract. Maverick amended its lawsuit to include the business disparagement and defamation claims based on comments H-E-B made about its lawsuit to the San Antonio Express-news.
“Unfortunately, our company is involved in a disagreement with a vendor who consistently failed to honor commitments in a timely manner and did not meet its obligations,” an H-E-B spokesman wrote in an email to the Express-news after the retailer filed its lawsuit. “This left H-E-B without the products to fulfill customer needs and resulted in lost sales.”
Maverick accused H-E-B of taking “affirmative actions to ‘leak’ or publicize” its lawsuit against the company and said the grocer’s actions amounted to business disparagement and defamation.
The Express-news obtained the lawsuit, which is public re
cord, through a routine check of court filings.
A state District Court judge in Jefferson County denied H-E-B’S bid to have those claims tossed, so it appealed to the 9th Court of Appeals in Beaumont.
H-E-B argued that Maverick’s claims should have been dismissed under the Texas Citizens Participation Act, or TCPA, a state law that allows parties to quickly dismiss retaliatory lawsuits meant to silence or intimidate them on matters of public concern.
Maverick countered that the
comments to the Express-news were commercial speech that falls under an exemption to the act.
In an October ruling, the appeals court agreed with Maverick that the commercial speech exception applied. H-E-B sought a rehearing but was denied, prompting the appeal to the state’s high court.
In its petition for review, filed Friday, H-E-B said the appeals court “impermissibly broadened the TCPA’S commercial speech exception.”
The act 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 a commercial transaction in which the intended audience is an actual or potential buyer or customers.”
The 9th Court of Appeals denied the act’s protections to “H-E-B when it spoke on matters of public concern in the capacities of a buyer of Maverick’s goods and as a litigant,” the retailer says in its appeal, adding boldface type for emphasis.
H-E-B adds that the appeals court’s ruling “categorically excludes retailers from the TCPA’S protections.”
Retailers sell goods and services to the public, H-E-B says, but under the appeals court’s
rationale, “any speech to a reporter that ultimately may be published that implicates those goods and services renders them speech to ‘actual or potential customers.’ ”
As a result, H-E-B says the ruling should be “an acute concern of retailers, which may face the type of retaliatory attack on speech that H-E-B faces here without the TCPA’S substantive and procedural protections.
“It is also a keen concern of the free press and the public, which will be deprived of information from retail speakers about matters of public concern, such as substandard suppliers, merchants, vendors, goods and services,” the grocery
chain adds.
The Texas Supreme Court generally sets for argument less than 10 percent of the cases it receives on appeal.
Maverick has until March 6 to file a response, unless it opts to waive such a filing. Extensions are often granted, however.
Meanwhile, the trial on H-E-B’S lawsuit against Maverick in Bexar County has been moved from March 20 to Oct. 2.
Lawyers for Maverick didn’t immediately respond to a request for comment Monday. An H-E-B spokeswoman declined to comment.