Texas Business Court Grants Summary Judgment On Fraud Claims In Fiberwave v. AT&T

In a memorandum opinion issued July 24, 2026, Judge Bouressa of the Texas Business Court’s First Division granted summary judgment on multiple fraud-related claims in Fiberwave, Inc. v. AT&T Enterprises, LLC. The ruling offers guidance for businesses navigating contractual disputes, fraud claims, and the application of the economic loss rule in Texas. It further cautions that speculative, circumstantial evidence is not enough to survive summary judgment as it does not “transcend mere suspicion.”

Background: A Commission Dispute

The dispute arose from a 2022 Alliance Program Agreement and Guidebook (Agreement) under which Fiberwave (formerly Spearhead Consulting) served as a “Solution Provider” marketing AT&T services in exchange for commissions and residual compensation. The relationship soured when AT&T terminated the agreement for cause, based on what it characterized as prohibited “kickback” payments to AT&T employees.

Fiberwave sued for fraudulent inducement, claiming AT&T never intended to honor its post-termination compensation obligations. AT&T counterclaimed for fraud against Fiberwave, its principal Faisal Chaudhry, and another former AT&T employee.

The Court’s Key Rulings

Dismissal of Fiberwave’s Fraudulent Inducement Claim

The court found that Fiberwave failed to present sufficient evidence that AT&T intended not to perform its contractual obligations at the time the Agreement was executed and granted AT&T’s no-evidence motion for summary judgment. While Fiberwave pointed to AT&T’s prior knowledge of kickback allegations based on investigations in 2016 and 2018, the court found this evidence amounted to “mere surmise or suspicion,” which it held is not sufficient to constitute proof of fraudulent intent.

Additionally, the court emphasized the agreement’s merger clause and waiver provision, which disclaimed reliance on any prior course of dealing. These provisions rendered any claimed reliance on AT&T’s alleged promises to make post-termination payments unjustified as a matter of law. In other words, having disclaimed reliance on any past conduct between the parties and on any failure by AT&T to enforce the terms of the Agreement, the court concluded Fiberware could not later claim to have justifiably relied on any alleged promise by AT&T to make post-termination payments despite a course of dealing that would justify non-payment. This serves as a reminder of the power of carefully drafted contract language.

Dismissal of AT&T’s Fraud Claims

Turning to AT&T’s fraud counterclaims, the court granted the counter-defendants’ motion for summary judgment on both no-evidence and traditional grounds.

No Evidence of Actionable Fraud: The court concluded AT&T failed to identify any specific law that the alleged kickback payments violated. Without establishing a violation of any particular statute or regulation, the court could not conclude that any representation of legal compliance was false. AT&T also failed to provide evidence of the counter-defendants’ intent to induce reliance or that it justifiably relied on any misrepresentation.

Economic Loss Rule Bars Recovery: Although the court did not need to reach counter-defendants’ traditional summary judgment motions on AT&T’s fraud claim after granting their no-evidence motion, it nevertheless determined that counter-defendants were also entitled to summary judgment under the economic loss rule. AT&T sought disgorgement or recission of commissions already paid, but the court held that both are equitable remedies designed to protect fiduciary relationships, and which are not available in arm’s-length commercial transactions. AT&T had pleaded only money damages, not rescission, and offered no argument that monetary relief would be inadequate. This foreclosed any path around the economic loss rule’s bar on tort claims seeking purely contractual losses.

Contract Ambiguity Sends Remaining Claims to Trial

With respect to the remaining claims, the court found the parties’ Agreement to be ambiguous on one key point: how to calculate vested residual compensation following a termination for “cause,” which the Agreement did not define. AT&T argued payments should be counted from the order’s start date; Fiberwave contended they should run from the termination date. The court found both interpretations plausible based on the contract’s language, and therefore held such contract claims would proceed to a jury trial in which the court would permit the parties to introduce extrinsic evidence to help resolve the ambiguous contract provisions.

Practical Implications for Texas Businesses

This opinion reinforces several critical takeaways:

1. Draft Contracts with Precision: Ambiguous language — even in appendices or guidebooks — might create expensive jury questions. Clear definitions and explicit timing mechanisms are essential.
2. Merger and Waiver Clauses Have Teeth: These provisions may defeat fraudulent inducement claims by negating justifiable reliance on prior representations or conduct.
3. Fraud Claims Face High Hurdles: Texas courts require more than suspicion to prove fraudulent intent. Circumstantial evidence must “transcend mere suspicion” to survive summary judgment.
4. The Economic Loss Rule Remains a Formidable Defense: Parties seeking tort remedies for what are essentially contractual disputes must establish an independent duty and independent injury — not just lost contractual benefits.
5. Plead Carefully: AT&T’s failure to plead disgorgement or rescission, and its exclusive focus on money damages, contributed to the dismissal of its fraud claims.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.