Texas Business Court Decision – August 10, 2026

No. 26-BC11A-0024   CAM Industrial Solutions LLC, et al. v. Brown & Root Industrial Services, LLC., et al. (Eleventh Div. , Judge Stagner) 2026 Tex. Bus. 56    26-bc11a-0024-cam-industrial-solutions-v-brown-root-industrial-services-2026-tex-bus-56.pdf

Contracts/Fiduciary Duty/Res Judicata/Privity/Issue Preclusion.

Background.  CAM lost its longtime maintenance contract for ExxonMobil’s Baytown Complex to competitor Brown & Root in late 2023. In a lawsuit filed in the 344th District Court of Chambers County, CAM alleged its former site manager, Sidney Daley, secretly photographed and transmitted CAM’s confidential rate sheets to Brown & Root in exchange for a $100,000 payment, received after he joined Brown & Root. In the Chambers County suit, CAM sued Brown & Root and several individuals (but not Daley). After deposing Daley as a nonparty and learning facts underlying its theory, CAM amended its petition to allege that Brown & Root knowingly participated in Daley’s breach of fiduciary duty, but never joined Daley, even though no scheduling deadline prevented it. At trial, the court refused to submit jury questions on Daley’s breach or Brown & Root’s knowing participation because Daley was not a party to the action. The jury rejected CAM’s trade secret claims and found no interference or fiduciary breaches by the named individual defendants. One day before the Chambers County court entered final judgment, CAM filed this action against Brown & Root (again alleging knowing participation) and, for the first time, Daley directly, alleging breach of contract and fiduciary duty. The matter comes before the court on defendants’ motions for summary judgment. The court grants Brown & Root’s motion, and denies Daley’s motion.

Issues:

1. Whether the Chambers County judgment, signed one day after this suit was filed, qualifies as a “prior” judgment for claim-preclusion purposes – Held: it does;
2. Whether CAM’s knowing-participation claim against Brown & Root arises from the same transaction litigated in Chambers County – Held: it does;
3. Whether Daley, a nonparty to the Chambers County suit, was in privity with any Chambers Count defendant – Held: he was not; and
4. Whether issue preclusion bars CAM’s claims against Daley based on the Chambers County jury’s findings – Held: it does not.

Discussion:

1. As to the claim against Brown & Root, Texas follows a “first final judgment” rule  in parallel actions, so the Chambers County judgment, which was filed well before the motion at issue here, was controlling and had preclusive effect.
2. Comparing near-verbatim pleadings, the knowing-participation claim in this case arose from identical operative facts as the Chambers County suit, and CAM, having learned of the key facts at Daley’s deposition with 10 weeks of discovery remaining, could have joined Daley if it had acted with reasonable diligence; the court also notes there was no deadline  for adding a party in the Chambers County scheduling order. Finally, there was no express reservation of CAM’s claim in the Chambers County judgment or transcript. The knowing-participation claim is barred by res judicata; the court does not reach Brown & Root’s alternative theory of issue preclusion.
3. As to Daley, he was never a party to the Chambers County action and failed to conclusively establish privity, which requires him to show he and Brown & Root represented the same legal interest; this is  generally found where the nonparty controlled the prior action, had interests which were fully represented by a party to the action, or was a successor-in-interest to a party; none of these bases for privity were present here. The court also rejects Daley’s argument that privity was established under a co-conspirator theory orthrough  his employment contract with Brown & Root.
4. On the question of issue preclusion, Daley had failed to show that the Chambers County action necessarily decided an issue essential to the contract and fiduciary duty claims CAM raises against him personally;  the jury’s findings may relate to the some of the same events, but none conclusively defeats CAM’s claims against Daley.