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Texas Supreme Court Weekly Update May 15, 2015

On Behalf of | May 15, 2015 | Texas Supreme Court Weekly Update

Today, the Texas Supreme Court issued one new opinion providing guidance on a defendant’s immunity under a defamation cause of action when it voluntarily assisted in a criminal investigation.

Shell Oil Company v. Writt, Case No. 13-0552:

A Shell contractor entered a guilty plea in a Foreign Corrupt Practices Act (FCPA) criminal case. The U.S. Department of Justice then initiated an investigation with Shell Oil Company related to their Nigerian operations with the independent contractor and Nigerian customs official at issue. Shell hired outside counsel and investigators to assist it in an internal investigation, which included several statements and interviews with Plaintiff Writt. Shell provided its investigation to DOJ and terminated Writt in connection with his conduct in the Nigerian operation as a “significant, substantial and unacceptable” violation of Shell’s General Business Principles and Code of Conduct.

Writt sued Shell for wrongful termination and defamation, which was based upon the turn over of Shell’s internal investigative reports to the DoJ. Shell moved for summary judgment, which the trial court granted. During the pendency of the motion for summary judgment, DOJ filed an information against Shell charging it with conspiracy to violate the FCPA. Shell and the DOJ then executed a Deferred Prosecution Agreement.

The trial court granted summary judgment finding an absolute immunity applied to Shell. Writt proceeded to trial on the wrongful termination claim, which he lost. He appealed only the granting of summary judgment on his defamation claim. The court of appeals reversed and held that the summary judgment evidence did not conclusively establish that at the time Shell provided its report to the DOJ a criminal judicial proceeding against either Shell or Writt was ongoing, actually contemplated, or under serious consideration by either the DOJ or Shell.

The Texas Supreme Court reversed and found that Shell’s provision of its internal investigation report, including the statements related to Writt, was absolutely privileged. The test for whether a communication is absolutely privileged when it occurs before judicial proceedings have begun entails both subjective and objective components. See Restatement (Second) Of Torts § 588 cmt. e (1977) (“As to communications preliminary to a proposed judicial proceeding, the rule . . . applies only when the communication has some relation to a proceeding that is actually contemplated in good faith and under serious consideration by he witness or a possible party to the proceeding.”) (emphasis added). The fact that a formal proceeding does not eventually occur will not cause a communication to lose its absolutely privileged status; however, it remains that the possibility of a proceeding must have been a serious consideration at the time the communication was made. See id. (“The bare possibility that the proceeding might be instituted is not to be used as a cloak to provide immunity for defamation when the possibility is not seriously considered.

The Court also reiterated that the absolute privilege is also extended to quasi-judicial proceedings and other limited instances in which the benefit of the communication to the general public outweighs the potential harm to an individual. While abuse of the absolute privilege is possible, it is limited because the speaker will generally still be subject to the risk of criminal prosecution for perjury or obstruction of justice. See, e.g., TEX.PENALCODE ch. 37 (“Perjury and Other Falsification”); 18 U.S.C. § 1505 (“Obstruction of proceedings before departments, agencies, and committees”).

The Texas Supreme Court reversed the court of appeals and reinstated the judgment of the trial court.


We hope you find this week’s update useful to your practice. Check back in next week to discovery whether the Texas Supreme Court issues any new opinions.

Best Regards,

The Bassett Firm


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