For many years now, intermediate Texas appellate courts have uniformly concluded that the statute of limitations period for civil conspiracy claims is two years.  The Texas Supreme Court had never formally addressed this question until this year.  In Agar Corporation v. Electro Circuits International, LLC, No. 17-0630, 62 Tex. Sup. Ct. J. 716 (Apr. 5, 2019), after holding that civil conspiracy is a vicarious liability theory that ties an individual to liability for an underlying tort, the court held that the statute of limitations for civil conspiracy should be the same as the statute of limitations for the underlying tort.  Thus, if the underlying tort is defamation—subject to a one-year statute of limitation—a conspiracy tied to the defamation is also subject to the one-year statute of limitation.  If the underlying tort is breach of fiduciary duty—subject to a four-year statute of limitation—a conspiracy to commit a breach of fiduciary duty is subject to the same four-year statute of limitation.

The court’s Agar opinion also takes up the question of when the statute of limitations for conspiracy should start running.  Some jurisdictions hold that it doesn’t start running until the last overt act that causes damage.  However, the Texas Supreme Court rejected this rule and held that the start of the limitations period should be the same time as for the underlying tort.  If there are multiple underlying tortious acts over the course of the conspiracy, then limitations for a conspiracy claim will accrue separately as to each separate underlying tort. 

In applying its rulings to the facts before it, the Agar court observed that Agar’s civil conspiracy claim was based upon underlying torts with varying statute of limitation periods.  Those underlying torts included

  • breach of fiduciary duty
  • fraud
  • misappropriation of trade secrets 

Misappropriation of trade secrets is subject to a three-year statute of limitation, but because Agar did not sue Electro until after the three-year statute of limitations had run, the court held that this cause of action would be barred.  But fraud and breach of fiduciary duty, which are subject to a four-year statute of limitation, would not be barred because it appeared that Agar had sued Electro within the four-year statute of limitation period.  

By Published On: June 13, 2019Categories: AppellateTags: ,

About the Author: Mike Northrup

Mike Northrup is a Shareholder and Section Head of the Cowles and Thompson Appellate Practice Group.