Before Justices Molberg, Pedersen, III, and Carlyle Opinion by Justice Molberg This is an accelerated interlocutoryappeal of two September 13, 2022 rulings: (1) an order denying appellant Pradeep Govindasamy’s motion for stay and to compel arbitration, and (2) a temporary injunction issued against appellants Govindasamy, QualiZeal, Inc., and Kalyana Roa Konda at the request of appellee Cigniti Technologies, Inc. For the reasons described below, and without reaching the second issue regarding the temporary injunction, which we conclude is now moot, we reverse the order denying the motion for stayand to compel arbitration and remand the case to the trial court for an order (1) compelling arbitration of all disputes between Cigniti Technologies and Govindasamy, including disputes regarding arbitrability; and (2) staying the proceedings before it pending arbitration of such disputes. I. BACKGROUND This dispute arises, in large part, from an alleged employment agreement appellee Cigniti Technologies, Inc. claims it entered into with Govindasamy, who, along with Konda, is a former President at Cigniti Technologies. According to Cigniti Technologies, the agreement contained a covenant not to compete that Govindasamy breached when he and Konda allegedly founded QualiZeal, a separate company, and began diverting opportunities to it while still employed at Cigniti Technologies. In its live pleading, Cigniti Technologies asserts, “Unbeknownst to [Cigniti Technologies], while they were [its] Presidents, Govindasamy and Konda co- founded QualiZeal in February and March 2021 as a direct competitor to Cigniti [Technologies].” Cigniti Technologies also asserts Govindasamy resigned from his employment with Cigniti Technology on October 19, 2021, and Konda resigned soon after, on November 10, 2021. On November 24, 2021, two weeks after Konda’s alleged resignation, Cigniti Technologies filed a “Verified[1] Original Petition and Application for Temporary Restraining Order, Temporary Injunction, and Permanent Injuction” asserting multiple claims against Govindasamy, Konda, and QualiZeal, as detailed in the bulleted list below. The trial court did not issue a temporary restraining order. In 2022, Cigniti Technologies amended its pleading twice. Neither of the amended petitions were verified, and neither sought a temporary restraining order. Both amended petitions sought a temporary and permanent injunction and included the same claims as those originally pleaded, which included: · claims against QualiZeal, Govindasamy, and Konda: misappropriation of trade secrets, tortious interference with existing and prospective business relations and contracts, and civil conspiracy; · an additional claim against Govindasamy: breach of contract · additional claims against Govindasamy and Konda: breach of fiduciary duty and fraudulent concealment; · an additional claim against QualiZeal: aiding and abetting Govindasamy’s and Konda’s alleged breach of fiduciary duty. In its second amended petition—its live pleading in the record before us[2]— Cigniti Technologies also added claims against another defendant, but those claims are not at issue in this appeal.[3] As to its breach of contract claim against Govindasamy, Cigniti Technologies’ live pleading states, in part, “Govindasamy started working for Cigniti in December 2014 as the company’s Chief Technology Officer. At that time, Govindasamy signed an Employment Agreement, which included a covenant not to compete.” Its live pleading also states, “A copy of the Agreement is attached as Exhibit 1[,]” “ Govindasamy voluntarily, knowingly, and validly entered into” the alleged employment agreement, “Govindasamy and Cigniti are parties to” that agreement, “Cigniti performed all its obligations under” that agreement, and “Govindasamy breached the [a]greement.” In each of its pleadings, Cigniti Technologies attached as Exhibit 1 the alleged employment agreement between Cigniti Technologies and Govindasamy. Exhibit 1 contains an arbitration clause that states: Section 8.09 — Governing Law and Dispute Resolution: This Agreement shall be governed by the laws of the State of Texas. The parties agree that, in the event a dispute arises between them, they will attempt, in good faith, to resolve such dispute in an amicable and equitable manner. The parties further agree that the matter will be decided by arbitration in accordance with the commercial arbitration rules of the American Arbitration Association[AAA]. Either party may apply to the [AAA] to institute the arbitration proceedings which are to be held exclusively in Dallas, Texas. Should either party refuse to submit or participate once a proceeding for arbitration has begun then the filing party may, at their election, choose to file a civil action under the exclusive jurisdiction of Dallas County, Texas, civil court. In terms of appellants’ pleadings, according to the docket sheet in the record before us, Konda filed a special appearance after he was served with citation. While the docket sheet reflects the special appearance was set for hearing, no ruling and no transcript of any such hearing is included in the record before us. Comments by Konda’s counsel in the September 6, 2022 hearing suggest Konda’s special appearance was still pending at the time the trial court heard the matters that are the subject of the two September 13, 2022 rulings at issue in this appeal. Govindasamy and QualiZeal, on the other hand, filed a verified original answer and later amended that pleading. In their verified original answer, Govindasamy and QualiZeal “expressly denie[d] the execution of any employment agreement with [Cigniti Technologies] . . . including the alleged agreement attached to [its] Original Petition as Exhibit 1.” In their verified first amended answer, Govindasamy and QualiZeal specifically denied “Govindasamy ever executed any alleged employment agreement with Cigniti Technologies.” Govindasamy filed a motion for stay and to compel arbitration on April 7, 2022. No exhibits were attached to his motion. When referring to the alleged arbitration agreement, Govindasamy’s motion cited portions of Cigniti Technologies’ then-live pleading, its first amended original petition, and Exhibit 1 attached to that then-live pleading. In his motion, Govindasamy acknowledged he had “filed an affirmative defense and specific denial as to the validity of” the alleged employment agreement but stated he “did not specifically challenge the [alleged employment agreement's] mandatory arbitration provision” and stated the trial court “should require Cigniti to follow the [a]lleged [a]greement that [it] claims is valid by enforcing the [a]rbitration [p]rovision’s plain text, staying this [p]roceeding, and compelling arbitration of Cigniti’s claims against Govindasamy.” Cigniti Technologies opposed the motion, but no written response is in the record before us. On September 6, 2022, the trial court heard that motion and other matters, including Cigniti Technologies’ application for temporary injunction. During the portion of the hearing regarding Govindasamy’s motion to compel, the parties’ counsel made arguments but presented no evidence. During the portion of the hearing on Cigniti Technologies’ temporary injunction application, three witnesses testified, and five exhibits were admitted into evidence. The alleged employment agreement between Cigniti Technologies and Govindasamy—Exhibit 1 attached to each of Cigniti Technologies’ pleadings—was not offered or admitted into evidence. On September 13, 2022, the trial court issued the two rulings about which appellants complain on appeal. The trial court provided no reason for its order denying Govindasamy’s motion for stayand to compel arbitration.[4] In its temporary injunction, the trial court made various findings, stating, in part, 11. On November 24, 2021, Cigniti requested a temporary restraining order. At that time, while the Court believed there might be something to Cigniti’s claims, it did not feel enough evidence existed to warrant injunctive relief. Thereafter, Cigniti engaged a forensic expert and compiled additional information. A hearing was held on September 6, 2022, at which time the aforementioned evidence was presented to the court. . . . . 13. The Court finds that Cigniti will suffer imminent and irreparable harm unless QualiZeal, Govindasamy, and Konda are enjoined as set forth below. Likewise, there is a reasonable probability of success on Cigniti’s claims for affirmative relief (breach of contract, breach of fiduciary duty, tortious interference with prospective and existing contracts, fraud, conspiracy, and aiding and abetting)[.] II. ANALYSIS A. Error in Denying Motion for Stay and to Compel Arbitration In their first issue, appellants allege the trial court erred by denying Govindasamy’s motion to stay and compel arbitration because Cigniti Technologies’ claims fall within the scope of the arbitration clause. As a preliminary matter, we note that the parties do not raise whether the Federal Arbitration Act (FAA) or the TexasArbitration Act (TAA) applies. Because the issues before us relate to arbitrability, we do not address the question. Haddington Fund, LP v. Kidwell, No. 05-19-01202-CV, 2022 WL 100111, at *4, n.7 (Tex. App.—Dallas Jan. 11, 2022, pet. denied) (mem. op.). 1. Standard of Review and Motions to Compel Arbitration, Generally We review the denial of a motion to compel arbitration for an abuse of discretion, deferring to the trial court on factual determinations supported by the evidence and reviewing legal determinations de novo. Henry v. Cash Biz, LP, 551 S.W.3d 111, 115 (Tex. 2018). Whether the claims in dispute fall within the scope of a valid arbitration agreement is a question of law, which we review de novo. Id. Because the trial court did not issue findings of fact or conclusions of law to explain its denial of the motion to compel arbitration, we must uphold the trial court’s decision on any appropriate legal theory urged below. Bonded Builders Home Warranty Ass’n of Tex. v. Rockoff, 509 S.W.3d 523, 531–32 (Tex. App.—El Paso 2016, no pet.). “Motions to compel arbitration are ordinarily decided in summary proceedings ‘on the basis of affidavits, pleadings, discovery, and stipulations.’” Kmart Stores of Tex., L.L.C. v. Ramirez, 510 S.W.3d 559, 565 (Tex. App.—El Paso 2016, pet. denied after merits briefing) (quoting Jack B. Anglin Co., Inc. v. Tipps, 842 S.W.2d 266, 269 (Tex. 1992) (orig. proceeding)). However, when a party seeking to compel arbitration provides competent, prima facie evidence of an arbitration agreement, and the party seeking to resist arbitration contests the agreement’s existence and raises genuine issues of material fact by presenting affidavits or other such evidence as would generally be admissible in a summary proceeding, the trial court must forgo summary disposition and hold an evidentiary hearing. Id. When the trial court conducts such a “Tipps hearing” and thereafter makes a ruling, we review the trial court’s findings for legal sufficiency. Id. In this case, no Tipps hearing occurred.[5] 2. Arbitrability Analysis Under TotalEnergies E&P USA, Inc. “Because arbitration is a matter of contract—’a matter of consent, not coercion’—parties cannot be compelled to arbitrate any controversy unless they have contractually agreed to do so.” TotalEnergies E&P USA, Inc., 667 S.W.3d 694, 701 (Tex. 2023) (quoting Robinson v. Home Owners Mgmt. Enters., Inc., 590 S.W.3d 518, 521 (Tex. 2019)). “A party seeking to compel arbitration must establish the existence of a valid arbitration agreement and that the claims at issue fall within the scope of that agreement.” Id. at 720 (quoting Henry, 551 S.W.3d at 115). “This is a two-step process, requiring the party to ‘first establish the existence of an arbitration agreement’ and then establish that ‘the arbitration agreement covers’ the claims asserted.” Id. (quoting Inre FirstMerit Bank, N.A., 52 S.W.3d 749, 753 (Tex. 2001)). TotalEnergies E&P USA, Inc. outlines the proper arbitrability analysis: A dispute over whether parties agreed to resolve their controversies through arbitration—referred to as a dispute over the controversies’ “arbitrability”—typically encompasses three distinct disagreements: (1) the merits of the underlying controversy . . . ; (2) whether the merits must be resolved through arbitration instead of in the courts; and (3) who (a court or the arbitrator) decides the second question. RSL Funding, LLC v. Newsome, 569 S.W.3d 116, 120 (Tex. 2018). The second question must be answered before the first, but the third must be answered before the second. Id. at 701. 3. Who Decides Questions of Arbitrability? We begin our analysis with the third question: who decides whether the merits must be resolved through arbitration instead of in the courts—a court, or the arbitrator? See id. Based on the holding in TotalEnergies E&P USA, Inc. and the clear and unmistakable language in the arbitration clause in this case, we conclude the arbitrator—not the court—must decide questions of arbitrability in this case. TotalEnergies E&P USA, Inc., explains: A contractual agreement to arbitrate controversies is severable from a broader contract that contains it, and courts must consider the two separately. Baby Dolls Topless Saloons, Inc. v. Sotero, 642 S.W.3d 583, 586 (Tex. 2022); see Rent-A-Ctr., W., Inc. v. Jackson, 561 U.S. 63, 70–71, 130 S.Ct. 2772, 177 L.Ed.2d 403 (2010). When a party challenges the validity of the broader contract but not of an arbitration agreement contained within that contract, courts must enforce the arbitration agreement and require the arbitrator to decide the challenge to the broader contract. Rent-A-Ctr., 561 U.S. at 72, 130 S.Ct. 2772. But when a party challenges the validity or scope of an arbitration agreement contained within a broader contract, courts must resolve that challenge to determine whether the parties agreed to arbitrate their controversies regarding the contract. Id. But courts have recognized an important exception to this severability rule. Because arbitration is a matter of contract, parties can agree that arbitrators, rather than courts, must resolve disputes over the validity and scope of their arbitration agreement. Jody James Farms, JV v. Altman Grp.,Inc., 547 S.W.3d 624, 631 (Tex. 2018). If the parties have contractually agreed to delegate arbitrability disputes to the arbitrator, courts must enforce that agreement just as they must enforce an agreement to delegate resolution of the underlying merits to the arbitrator. RSL Funding, 569 S.W.3d at 120. “If, on the other hand, the parties did not agree to submit the arbitrability question itself to arbitration, then the court should decide that question just as it would decide any other question the parties did not submit to arbitration, namely, independently.” First Options, 514 U.S. at 943, 115 S.Ct. 1920. For the most part, the determination of whether parties have agreed to delegate arbitrability to an arbitrator is governed by “ordinary state-law principles that govern the formation of contracts.” Id. at 944, 115 S.Ct. 1920. But because parties often “might not focus [on] the significance of having arbitrators decide the scope of their own powers,” and to avoid the risk of requiring parties to arbitrate a dispute they have not agreed to arbitrate, courts will only enforce an agreement to delegate arbitrability to the arbitrator if that agreement is “clear and unmistakable.” Robinson, 590 S.W.3d at 525, 532. Id. (internal footnotes omitted). The court then discussed various precedents regarding incorporation of arbitration rules, such as the commercial rules of the American Arbitration Association (AAA), id. at 702–12, and “agree[d] with the vast majority of courts that, as a general rule, an agreement to arbitrate in accordance with the AAA or similar rules constitutes a clear and unmistakable agreement that the arbitrator must decide whether the parties’ disputes must be resolved through arbitration.” Id. at 707 (emphasis added). After noting “[t]he AAA rules . . . provide that the arbitrator ‘shall have the power to rule on his or her own jurisdiction, including any objections with respect to the existence, scope, or validity of the arbitration agreement or to the arbitrability of any claim or counterclaim[,]‘” see id. at 709 (quoting AM. ARB. ASS’N. R-7(a) (2013)), the court then held: [A]s a general rule, an agreement to arbitrate disputes in accordance with rules providing that the arbitrator “shall have the power” to determine “the arbitrability of any claim” incorporates those rules into the agreement and clearly and unmistakably demonstrates the parties’ intent to delegate arbitrability issues to the arbitrator. Id. at 720. Here, the arbitration clause at issue does just that, by stating that “the matter will be decided by arbitration “in accordance with the commercial arbitration rules of the American Arbitration Association [AAA]” (emphasis added). Thus, consistent with TotalEnergies E&P USA, Inc., see id., we conclude Cigniti Technologies and Govindasamy clearly and unmistakably agreed to delegate arbitrability issues to the arbitrator and thus conclude the trial court abused its discretion in denying Govindasamy’s motion for stay and to compel arbitration. 4. Assuming Arbitrability Was to be Decided by a Court, Is There Proof an Arbitration Agreement Exists? Even if we assume, as Cigniti Technologies argues, that a court is to decide the parties’ issues regarding arbitrability, we agree with Govindasamy’s view that, in light of Cigniti Technologies’ live pleading, there is proof an arbitration agreement exists between Cigniti Technologies and Govindasamy. Both in the trial court and on appeal, Cigniti Technologies has argued Govindasamy has not met his burden of establishing the existence of an arbitration agreement between them by focusing on Govindasamy’s denial in his own pleading that he signed the alleged employment agreement. In contrast, Govindasamy focuses on Cigniti Technologies’ live pleading—namely, its attachment of Exhibit 1 to its pleading, which contains the arbitration clause upon which Govindasamy’s motion relies.[6] Although Govindasamy did not use the phrase “judicial admission,” the gist of Govindasamy’s argument throughout the case has been that, in light of its breach of contract claim against him, Cigniti Technologies has admitted the agreement exists. At oral argument in our Court, appellants described Cigniti Technologies’ position as wanting to both “have its contract and defeat it.” We agree with Govindasamy. More than thirty years ago, we stated: Pleadings in a case are judicial admissions for that case. Kirk v. Head, 137 Tex. 44, 152 S.W.2d 726, 729 (1941). If a party judicially admits a fact, it is conclusively proven against the party making the statement. It relieves the opposing party from having to prove the fact judicially admitted. See Mendoza v. Fidelity &Guaranty Ins. Underwriters, Inc., 606S.W.2d692, 694(Tex. 1980); Gevinsonv. ManhattanConstruction Co. of Oklahoma, 449 S.W.2d 458, 467 (Tex. 1969). Rader v. Capezzuto, No. 05-92-02870-CV, 1993 WL 459965, at *3 (Tex. App.— Dallas Nov. 10, 1993, pet. denied).[7] More recently, we stated: Assertions of fact, not pleaded in the alternative, in the live pleadings of a party are regarded as formal judicial admissions. Holy Cross Church of God in Christ v. Wolf, 44 S.W.3d 562, 568 (Tex. 2001); Houston First Am. Sav. v. Musick, 650 S.W.2d 764, 767 (Tex. 1983). A judicial admission that is clear and unequivocal is conclusive upon the party making it; it relieves the opposing party of the burden of proving the admitted fact and bars the admitting party from disputing it. Wolf, 44 S.W.3d at 568; Gevinson v. Manhattan Constr. Co., 449 S.W.2d 458, 467 (Tex. 1969). Murphy v. Killer Ridez, Inc., No. 05-13-00035-CV, 2014 WL 428987, at *1–2 (Tex. App.—Dallas Feb. 3, 2014, no pet.) (mem. op.); see Constant v. Gillespie, No. 05- 20-00734-CV, 2022 WL 1564555, at *9 (Tex. App.—Dallas May 18, 2022, no pet.) (mem. op.) (“A judicial admission must be a clear, deliberate, and unequivocal statement” and “occurs when an assertion of fact is conclusively established in live pleadings, making the introduction of other pleadings or evidence unnecessary.”) (quoting Horizon/CMS Healthcare Corp. v. Auld, 34 S.W.3d 887, 905 (Tex. 2000)). Even if we assume that a court, not the arbitrator, is to decide the parties’ issues regarding arbitrability, we conclude, based on its live pleading, Cigniti Technologies has judicially admitted the existence of the alleged employment agreement in Exhibit 1, which contains the arbitration clause upon which Govindasamy relies in his motion for stay and to compel arbitration. This judicial admission conclusively proves against Cigniti Technologies the existence of Exhibit 1 and the arbitration clause within it and relieves Govindasamy from having to do more to prove that fact. See Rader, 1993 WL 459965, at *3.[8] 5. Resolution of Appellants’ First Issue In light of our conclusions above, we hold the trial court abused its discretion in denying Govindasamy’s motion for stay and to compel arbitration. We decline to address anyremaining arguments raised in the briefs regarding appellants’ first issue because doing so is unnecessary to the resolution of this appeal. See TEX.R.APP.P. 47.1. We sustain appellants’ first issue. B. Alleged Error in Temporary Injunction In their second issue, appellants argue the trial court erred by granting Cigniti Technology’s application for temporary injunction because Cigniti Technologies failed to show irreparable harm or likelihood of success on the merits and because the injunction destroyed the status quo and is impermissibly vague. We cannot review this issue, however, because appellate courts cannot review a temporary injunction that is moot, as we conclude this one is. In National Collegiate Athletic Association v. Jones, 1 S.W.3d 83 (Tex. 1999), the court stated: Appellate courts are prohibited from deciding moot controversies. . . . This prohibition is rooted in the separation of powers doctrine in the Texas and United States Constitutions that prohibits courts from rendering advisory opinions. . . . A case becomes moot if at any stage there ceases to be an actual controversy between the parties. . . . When a temporary injunction becomes inoperative due to a change in status of the parties or the passage of time, the issue of its validity is also moot. An appellate court decision about a temporary injunction’s validity under such circumstances would constitute an impermissible advisory opinion. Id. at 86 (internal citations omitted). We conclude the temporary injunction in this case is moot because it has become inoperative due to the passage of time when the non-competition and non- solicitation provisions in the alleged employment agreement attached to Cigniti Technologies’ live pleading and forming the basis for its request for injunctive relief expired, at their latest, on October 19, 2023, two years after Govindasamy’s resignation. See Wimbrey v. WorldVentures Mktg., LLC, No. 05-19-01520-CV, 2020 WL 7396007, at *3–5 (Tex. App.—Dallas Dec. 17, 2020, no pet.) (mem. op.) (concluding issue of the validity of a non-solicitation provision in a temporary injunction was moot when the contractual provision upon which the restriction in the injunction was based had expired); Rimes v. Club Corp. of Am., 542 S.W.2d 909, 912 (Tex. Civ. App.—Dallas 1976, writ ref’d n.r.e.) (“Here, the parties entered into a contract providing for noncompetitive period following cessation of employment and such period is now past which causes the issue [of extending the applicable period of the non-compete agreement] to become moot.”); see also Weatherford Oil Tool Co. v. Campbell, 340 S.W.2d 950, 952 (Tex. 1960) (since one-year time period provided in the restrictive covenant had expired, suit for an injunction became moot before cause could be submitted to Texas Supreme Court). III. CONCLUSION For the reasons described above, we reverse the order denying the motion for stay and to compel arbitration and remand the case to the trial court for an order (1) compelling arbitration of all disputes between Cigniti Technologies and Govindasamy, including disputes regarding arbitrability; and (2) staying the proceedings before it pending arbitration of such disputes. Ken Molberg KEN MOLBERG JUSTICE Court of Appeals Fifth District of Texas at Dallas JUDGMENT QUALIZEAL, INC., PRADEEP GOVINDASAMY, AND KALYANA ROA KONDA, Appellants No. 05-22-00923-CV V. On Appeal from the 101st Judicial District Court, Dallas County, Texas Trial Court Cause No. DC-21-17023. Opinion delivered by Justice Molberg. Justices Pedersen, III and Carlyle participating. CIGNITI TECHNOLOGIES, INC., Appellee In accordance with this Court’s opinion of this date, we REVERSE the September 13, 2022 order denying the motion for stay and to compel arbitration and REMAND the case to the trial court for an order (1) compelling arbitration of all disputes between Cigniti Technologies and Pradeep Govindasamy, including disputes regarding arbitrability; and (2) staying the proceedings before it pending arbitration of such disputes. It is ORDERED that appellant QUALIZEAL, INC., PRADEEP GOVINDASAMY, AND KALYANA ROA KONDA recover their costs of this appeal from appellee CIGNITI TECHNOLOGIES, INC. Judgment entered this 28th day of February, 2024.
