Full opinion text
OPINION STOVER, Justice. This appeal arises from a suit by 127 investors (appellants) against the accounting firm of Grant Thornton International (Grant), ap-pellee. The appellants, many of whom are current or former professional athletes, were investors in government securities trading programs offered by an entity known as Hill-crest Securities Corporation, Inc. (Hillcrest); the trades, on which appellants lost thousands of dollars, were purportedly reviewed and verified for authenticity by Grant. The investors sued Grant for multiple causes of action, including, but not limited to, fraud, aiding and abetting fraud, Deceptive Trade Practices Act (DTPA) violations, breach of contract, breach of fiduciary duty, aiding and abetting a breach of fiduciary duty, breach of warranty, securities laws violations, negligence, and negligent misrepresentation. Over the course of ten years, Grant filed various motions for summary judgment, eleven of which were granted by the trial court. Appellants now challenge the summary judgments on appeal. Also before us on appeal is Grant’s cross point appealing the two motions for summary judgment granted in favor of the Hendricks brothers on Grant’s counterclaims for contribution. Along with other Hillcrest investors, Randal Hendricks and his brothers, David and Alan Hendricks, sued Grant for damages from losses sustained in the Hillcrest transactions. At the time of the filing of suit, the Hendricks brothers, doing business as Hendricks Sports Management, were also sports agents who represented professional athletes. The record reveals the Hendricks brothers negotiated professional contracts for their clients, prepared income tax returns, and gave advice on investments, business opportunities, personal financial planning, and tax planning. As compensation, Hendricks Sports Management typically received fees from their clients’ investment ventures and a percentage of their professional sports contracts. In 1985 David Hendricks, as trustee, filed the initial suit against Hillcrest and others; Grant was not among those initially sued. In the original suit, Hendricks alleged that Hill-crest both offered to sell and, in fact, did sell securities by means of a prospectus or oral communication which included an untrue statement of material fact, or which failed to disclose a material fact. Approximately one year later, on May 9, 1986, David Hendricks amended his petition, adding his brothers, Randal and Alan, and other Hillcrest investors as plaintiffs, and Grant Thornton as a defendant. Appellants alleged they participated in trading programs, designed, offered, and underwritten by Hillcrest, which had represented the programs and strategies as being sound investments that would secondarily yield legitimate tax benefits. According to their petition, some of the appellants began participating in the program in 1981; others were added gradually up through 1984. Appellants also allege Hillcrest represented that the accounting firm, Grant Thornton, would audit the trading programs and appellants’ accounts as part of a due diligence procedure in administering and monitoring the programs. Beginning in late 1981 or early 1982, (CRI68) Grant itself, according to appellants, made representations vouching for the viability and legitimacy of the securities even though Grant knew or should have known the information and representations were false. Subsequently, as alleged by appellants, the Internal Revenue Service (IRS) disallowed the tax benefits for the years 1982 and 1988, because the transactions were “bogus and fictitious.” Appellants claim their aggregate losses were in the millions of dollars. Grant’s connection with Hillcrest began in 1982 when Grant performed certain audit and tax services, specifically the auditing of Hillcrest’s financial statements for both 1982 and 1988. During those same years, Hill-crest also asked Grant to prepare certain tax memoranda which discussed specific tax questions concerning Hillerest’s trading program. The tax memoranda, according to Grant, were never intended to be used as a marketing tool with prospective investors. Yet Hendricks obtained a copy of the tax memoranda and mailed the same to Hendricks’ clients. In its 1982 marketing brochures, Hillcrest listed Grant as a reference and invited potential investors to check on the reliability of Hillcrest Equities, Inc., Hillcrest Securities Corporation, Inc. and its principals by calling, among others, Alexander Grant and Co. [Grant Thornton]. The list of references in Hillcrest brochures included the following: John Latta, CPA, Alexander Grant & Company; and George Banks, CPA, Alexander Grant & Company. Appellants claim that, with Grant’s knowledge, Hillcrest’s 1983 marketing materials promised potential investors that Grant would verify the authenticity of the trades made by Hillcrest. One part of the question and answer section in the 1983 brochure reads as follows: 5. Are actual trades being made? Hillcrest Securities Corporation, Inc. executes all of its trades with other dealers. Alexander Grant and Company is required to visit dealers and evaluate these transactions in order to verify their authenticity. 19. How can I check on the reliability of Hillcrest Equities, Inc., Hillcrest Securities Corporation, Inc. and its principals? The auditing, taxes, and general accounting for Hillcrest Equities, Inc. and Hill-crest Securities Corporation, Inc. has been handled by the national firms of Alexander Grant & Co. and Pannell Kerr Forster. Please feel free to call any of the references listed in our corporate brochure to check on the reliability of Hillcrest Equities, Inc., Hillcrest Securities Corporation, Inc. and its principals. According to appellants, Grant never verified the authenticity of the trades and thereby caused appellants to lose their tax benefits, as well as their investments. At the outset, we note the trial court held two hearings on the motions for summary judgment. At the first hearing, five separate summary judgments were granted; the other six were disposed of in another hearing some months later. The orders granting those summary judgments recite that the trial judge considered, among other things, all the motions, the briefs, and the summary judgment evidence filed by each party. Based on this recital, we know the trial judge considered all summary judgment evidence before him at the time of the hearing and did not restrict himself in ruling on a particular summary judgment to only the evidence attached to that motion for summary judgment. See Tex.R. Civ. P. 166a(c). In our review of the points of error regarding the various motions for summary judgment, we likewise, consider the pleadings, deposition excerpts, affidavits, and other evidence on file with the court, including those in other summary judgment motions, as long as they are referenced in the summary judgment motion at issue. We acknowledge there are two lines of authority on this subject matter. However, we follow Boeker v. Syptak, 916 S.W.2d 59, 61-62 (Tex.App.—Houston [1st Dist.] 1996, no writ); Dear v. City of Irving, 902 S.W.2d 731 (Tex.App.—Austin 1995, writ denied); Kotzur v. Kelly, 791 S.W.2d 254, 257 (Tex.App.—Corpus Christi 1990, no writ). See Tex.R. Civ. P. 166a(e). In brief, the trial court granted summary judgment in favor of Grant and against appellants on the following causes of action: 1. Grant’s motion for summary judgment on appellants’ negligent conduct and fiduciary duty claims on statute of limitation grounds; 2. Grant’s motion for summary judgment on appellants’ DTP A claims; 3. Grant’s motion for partial reconsideration on a motion for summary judgment previously denied by the trial court. The motion for partial reconsideration was on the following grounds: (a) breach of contract (b) breach of fiduciary duty (c) Texas securities claims (d) Federal securities claims (e) breach of warranty; 4. Grant’s motion for partial summary judgment on reliance and causation as to thirty-two of the investors; 5. Grant’s motion for summary judgment on appellants’ claim of failure to maintain independence; 6. Grant’s motion for summary judgment on appellants’ claims under See. 12 of the Securities Act of 1933 and Sec. 33(A) of the Texas Securities Act; 7. Grant’s motion for summary judgment on appellants’ fraud, aiding and abetting fraud, conspiracy claims, and aiding and abetting fraud under § 33(F) of the Texas Securities Act; 8. Grant’s motion for summary judgment on appellants’ claims under Sec. 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5; 9. Grant’s motion for summary judgment on appellants’ claims under Sec. 17 of the Securities Act of 1933; 10. Grant’s motion for summary judgment on limitations grounds for federal securities claims brought under Sec. 12(1) and 12(2) of the Securities Act of 1933; 11. Grant’s motion for summary judgment on appellants’ claim for aiding and abetting a breach of fiduciary duty of another. In addition to granting eleven summary judgments in favor of Grant, the trial court granted the Hendrickses’ two summary judgment motions on Grant’s counterclaims for contribution against Hendricks Management Company and Hendricks Sports Management. On appeal, the investors challenge the trial court’s granting of the motions for summary judgment in fifteen points of error. Grant, in turn, challenges through a cross point the two summary judgments granted in favor of the Hendricks brothers. The summary judgment standard is well established. The movant must show (1) there are no genuine issues of material fact and (2) he is entitled to judgment as a matter of law. Nixon v. Mr. Property Management Co., 690 S.W.2d 546, 548-49 (Tex.1985). Summary judgment for a defendant is proper if the defendant disproves at least one element of each of the plaintiffs claims or establishes all elements of an affirmative defense to each claim. American Tobacco Co. v. Grinnett, 951 S.W.2d 420, 425 (Tex.1997). In determining whether summary judgment is proper, we must consider all the evidence in the light most favorable to the non-movant and resolve doubts in his favor. Id. DECEPTIVE TRADE PRACTICES CLAIMS In point of error six, appellants contend the trial court erred in granting summary judgment in favor of Grant on appellants’ DTPA claims. Tex. Bus. & Com. Code Ann. §§ 17.41 et seq. (Vernon 1987). The basis of Grant’s motion is appellants’ lack of consumer status under the DTPA. For a person to qualify as a consumer under the DTPA, he must meet two requirements. First, he must have sought or acquired, by purchase or lease, goods or services. Tex. Bus. & Com.Code Ann. § 17.45(4) (Vernon 1987). Second, the acquired goods or services must form the basis of the complaint. Melody Home Mfg. v. Barnes, 741 S.W.2d 349, 352 (Tex.1987). The DTPA does not require the consumer to be an actual purchaser or lessor of the goods or services as long as the consumer is the beneficiary of them. Arthur Andersen & Co. v. Perry Equip. Corp., 945 S.W.2d 812, 815 (Tex.1997). Appellants did not purchase “goods” or “services” from Grant under the definitions given in the DTPA. See Tex. Bus. & Com.Code Ann. § 17.45(1),(2) (Vernon 1987). Even where the activity complained of does not fall into either category, however, a number of Texas courts have conferred consumer status on plaintiffs in circumstances where the activity complained of was collateral to the acquisition of an intangible. These cases generally involve the acquisition of such intangibles as loans, bank accounts, or franchise agreements. Securities, which are present in this case, are considered intangibles, not “goods” under the DTPA. See Portland Sav. and Loan Ass’n v. Bevill, Bresler & Schulman Gov’t Sec., Inc., 619 S.W.2d 241, 245 (Tex.Civ.App.—Corpus Christi 1981, no writ). Although the DTPA does not cover the purchase of intangibles, a plaintiff can nonetheless bring the acquisition of services associated with the intangible within the DTPA by alleging he would not have sought or purchased the intangible but for the collateral services offered along with those items. Lochabay v. Southwestern Bell Media, Inc., 828 S.W.2d 167, 171-72 (Tex.App. —Austin 1992, no writ). See also Herndon v. First Nat’l Bank of Tulia, 802 S.W.2d 396, 398-99 (Tex.App.—Amarillo 1991, writ denied); FDIC v. Munn, 804 F.2d 860, 865 (5th Cir.1986) (stating that the key principle in determining “consumer” status in DTPA cases involving intangible items is whether the purchased goods or services are an objective of the transaction [involving the intangible] or merely incidental to it). The Texas Supreme Court recently adopted a similar test for the determination of consumer status. Whether a party is a consumer depends on the plaintiffs’ relationship to the transaction, not on the relationship between the parties, and on whether the goods or services are an objective of the transaction or merely incidental to it. Andersen, 945 S.W.2d at 815; see Amstadt v. United States Brass Corp., 919 S.W.2d 644, 649 (Tex.1996); Hand v. Dean Witter Reynolds, Inc., 889 S.W.2d 483, 500 (Tex.App.—Houston [14th Dist.J 1994, writ denied). The question for us then is whether in its motion for summary judgment Grant demonstrated as a matter, of law that its accounting and auditing services regarding the Hillcrest transactions were merely incidental to appellants’ purchase of the securities rather than an objective of the purchase. In Andersen, the Texas Society of Certified Public Accountants (TSCPA), as amicus curiae, contended that a stock purchaser should not be considered a consumer of an accounting firm (Arthur Andersen) simply because a corporation (Ramteck II) paid the firm for an audit for the purchaser’s (Perry Equipment’s) benefit. Under that scenario, argued the TSCPA, any stock purchaser who reviews audited financial statements could bring a DTPA claim against the auditor because virtually every external audit benefits third parties. Andersen, 945 S.W.2d at 815. In a specific reference to the issue raised in the amicus curiae’s argument, the Texas Supreme Court declared it would not adopt a ruling with such broad implications. Instead, the Court restricted its finding of consumer status to the narrow facts of the case. There, the audit by Andersen was rendered in the sale of a business (Maloney Pipeline) by Ramteck II to Perry Equipment (PECO); the buyer (PECO) required an audit of Malo-ney Pipeline before the sale could take place; the audit was specifically intended to benefit the buyer; Arthur Andersen was aware PECO had required the audit and would rely on its accuracy; and the accounting firm also knew the specific purpose for which the audit was conducted. Under, those narrowly drawn facts, the Supreme Court found the buyer of the business to be a consumer of the accounting firm even though there was no accountant/client relationship. In the instant case, summary judgment evidence reveals Grant performed tax, accounting, and auditing services for Hillcrest, as did Arthur Andersen for Ramteck II. Grant’s name, along with many others, appeared in Hillcrest’s marketing brochures as a reference regarding Hillcrest’s reliability. Unlike the Andersen case, however, there is no evidence of any contract between the investors and Hillcrest which called for an audit to be performed before any securities would be purchased- by the investors; and there is no evidence that an audit by Grant or verification of trades by Grant was specifically intended to benefit the investors. The summary judgment evidence establishes that Grant’s services were incidental to the transaction, and the investors’ evidence does not raise a fact issue indicating that those services were an objective of the transaction between Hillcrest and appellants. See Kinnard v. Circle K. Stores, Inc., No. 04-96-00798-CV, 1998 WL 28105 (Tex.App.—San Antonio Jan.28, 1998, n.w.h.). Appellants herein are not consumers under the DTP A. The trial court’s summary judgment regarding the DTPA claims is affirmed. Point of six is overruled. FRAUD-RELATED CLAIMS In point of error seven, appellants contend the trial court erred in granting appellee’s motion for summary judgment on appellants’ claims for fraud, aiding and abetting fraud, conspiracy to defraud, and aiding and abetting fraud under § 33(F) of the Texas Securities Act. Points of error three, four, and five further contend that the trial court erred in granting summary judgment on claims not raised or addressed in appellee’s motion and that the trial court erred in concluding that appellee’s motions for summary judgment disposed of all of appellants’ claims. In appellants’ Fifth Amended Petition, on which this particular motion for summary judgment is based, appellants pleaded, among others, the fraud-related causes of action listed above, alleging various misrepresentations they claim Grant made in connection with the Hillcrest securities program. Those misrepresentations include the following: (1)Through its tax opinion memoranda, Grant vouched for the viability and legitimacy of certain material tax aspects of the securities offered in the 1982-1984 Hill-crest programs; (2) Grant represented, and allowed others to represent, that it would verify the authenticity of the trades, but failed to disclose that it did not; (3) Grant represented that the performance of its work would adhere to Generally Accepted Accounting Standards (GAAS) and Generally Accepted Accounting Procedures (GAAP), but failed to conduct the audits of Hillcrest in such fashion; (4) Grant violated Rules 101,102, 201, 203, and 502 of the Texas Code of Professional Conduct of Accountants by fraudulently and recklessly placing its own interests ahead of its professional obligations. (5) Grant had conflicts of interest and lacked independence, as demonstrated by Larry Jobe, an accountant and tax partner with Grant’s Dallas office, who allegedly invested with Hillcrest at the very time Grant was conducting an audit of Hill-crest. The causes of action on which Grant obtained the summary judgment addressed in point of error seven involve fraud, and all have the elements of scienter or intent to induce rebanee. A fraud cause of action requires a material misrepresentation, which was false, and which was either known to be false when made or was asserted without knowledge of its truth, which was intended to be acted upon, which was rebed upon, and which caused injury. Sears, Roebuck & Co. v. Meadows, 877 S.W.2d 281, 282 (Tex.1994). To obtain summary judgment, as noted above, the movant must either negate one of the elements of the cause of action or prove all the elements of an affirmative defense. Grinnell, 951 S.W.2d at 425. Choosing the former, Grant sought to negate, in regard to the fraud-related claims, the elements of (a) intent to induce rebanee and (b) scienter— knowledge that the misrepresentation was false when made. We initially address appellants’ lack of independence issue. Grant filed a separate motion for summary judgment on lack of independence, which was based on the investors’ allegations in the Fourth Amended Petition. Grant claimed in its motion that no cause of action for lack of independence exists in Texas. The trial court granted the motion dismissing the lack of independence cause “WITH PREJUDICE.” Subsequent to the trial court’s granting of said summary judgment, appellants filed their Fifth Amended Petition in which they again pleaded lack of independence — this time with a new set of facts. Issues determined in a partial summary judgment are final although the judgment is interlocutory. Crumpton v. Mike Stevens, MGA, 936 S.W.2d 473, 477 (Tex.App.—Fort Worth 1996, no writ). After an interlocutory summary judgment is granted, the issues it decides cannot be litigated further unless the trial court sets the judgment aside or the partial summary judgment is reversed on appeal. Id. We, therefore, overrule point of error seven regarding the lack of independence issue as appellants’ arguments deal with the re-pleaded issue contained in their Fifth Amended Petition, and are silent as to the lack of independence issue pleaded in their Fourth Amended Petition. Grant contends its evidence conclusively establishes the absence of intent to induce reliance and scienter, and, thus, summary judgment was proper. To negate the element of intent to induce reliance, Grant attached as summary judgment proof the affidavits of John Latta and George Banks, who, as partners in Grant, are unquestionably interested witnesses. Latta’s affidavit addresses the tax memoranda issue, which, for the reasons explained above, we need not consider. Banks’ affidavit, which concerns the audit reports, contains, among others, the following averments: [Njeither I, nor to my knowledge any other person at Alexander Grant, knew or expected that the reports of our audits of the Hillcrest financial statements were going to be shown to, or relied upon by, any Prospective Investors of any of the Exhibit A plaintiffs_ I had no reason to believe that any investor in the Hillcrest program had received a copy of an Alexander- Grant report on any of Hillcrest’s financial statements.... [NJeither I, nor to my knowledge any other person at Alexander Grant, intended to deceive or defraud Prospective Investors or any of the Exhibit A Plaintiffs or to bring about, participate in, or aid and abet any fraud against Prospective Investors or any of the Exhibit A Plaintiffs. A summary judgment may be based on uncontroverted testimony of an interested witness if the evidence is clear, positive and direct, otherwise credible and free from contradictions and inconsistencies, and “could have been readily controverted.” Tex.R. Civ. P. 166a(c). The Texas Supreme Court has defined the phrase “could have been readily controverted” to mean the testimony at issue is of a nature which can be effectively countered by opposing evidence. Casso v. Brand, 776 S.W.2d 551, 558 (Tex.1989). Banks’ affidavit does not meet that standard. First, it includes statements based in part on information and belief. Second, it is not grounded in any sound evidence which can be effectively countered by opposing evidence. The affidavit simply concludes that neither he, nor to his knowledge, any other person at Grant, intended to induce prospective investors to rely on Grant’s audits of Hillcrest financial statements. This type of evidence is merely a denial of intent. We conclude the mere denial of intent by an interested witness is not enough to negate the element of intent to induce reliance. Grant relies on Blue Bell, Inc. v. Peat, Marwick, Mitchell & Co., 715 S.W.2d 408 (Tex.App.—Dallas 1986, writ refd n.r.e.) for the following proposition: The mere fact that it should he known that another will rely upon a misrepresentation does not, of itself, establish that the misrepresentation was made with the intent to induce reliance. The “intent” element of a fraud action imports a significantly greater degree of purposeful conduct than does the “foreseeability” element of a negligence action. Apart from its argument that “foreseeability” of reb-anee establishes the requisite intent, Blue Bell adduced no summary judgment evidence tending to show that PMM intended to induce Blue Bell’s reliance on PMM’s representations. Accordingly, there was no genuine issue of fact raised as to this element of Blue Bell’s cause of action for fraud. Id. at 415 (footnote omitted). We do not disagree with the holding in Blue Bell. However, the burden is still upon the movant to first negate the element of intent to induce reliance, and we do not believe the affidavit does so. Issues of intent and knowledge are not susceptible of being readily controverted and are generally inappropriate for summary judgment. RRR Farms, Ltd. v. American Horse Protection Ass’n, Inc., 957 S.W.2d 121, 182 (Tex.App.—Houston [14th Dist.] 1997, writ denied); Bankers Commercial Life Ins. Co. v. Scott, 681 S.W.2d 228, 231 (Tex.App.— Tyler 1982, writ ref d n.r.e.). Intent is a fact question uniquely within the realm of the trier of fact because it depends so much upon the credibility of the witnesses and the weight to be given to their testimony. Spoljaric v. Percival Tours, Inc., 708 S.W.2d 432, 434 (Tex.1986). Beyond Banks’ statement regarding intent, which is not readily controvertible, Grant offers no other evidence effectively negating intent to show reliance. Consequently, Grant did not negate that element of the fraud-related claims. Grant also attempted to negate the element of scienter with regard to Grant’s audit and tax work for Hillcrest, as well as appellant’s claim regarding Grant’s failure to verify the trades. According to Grant, the testimony of its accounting experts establishes that it performed its tax and audit work in accordance with appropriate standards. The affidavits of Grant’s three accounting experts all bear that out, since each expert avers that Grant performed its audit and tax work for Hillcrest in accordance with GAAS and GAAP standards. We conclude that if there is uncontroverted expert opinion that appellee’s audit reports met GAAP and GAAS standards, such testimony negates the scienter element of the fraud-related causes of action — namely the allegation that Grant knew the audits were false when made or that they were made recklessly without any knowledge of the truth. Since the affidavits of Ammerman, Bour-land, and Howard, in effect, negated the scienter element, the burden then shifted to appellants to raise a fact issue regarding it. As summary judgment proof, appellants attached to their response the affidavit of James Cogan, certified public accountant, who opines that “[Grant] was reckless to issue its unqualified audit opinion of Hill-crest....” His opinion, however, does not indicate that the audits were false when Grant issued them or that they failed to conform to GAAP or GAAS. Moreover, his statement that they were issued recklessly is merely a conclusory one and does not state in what way or why their issuance was reckless. Rather than focusing on the audit reports, Cogan’s affidavit instead focuses on Grant’s failure to verify the trades, which, as pointed out repeatedly by appellants, is not the same fraud allegation as that concerning the audit reports. Cogan’s affidavit fails to raise a fact issue regarding scienter. Therefore, Grant has negated one of the elements of fraud in connection with the audit reports. Grant also attempts by way of footnote in its motion for summary judgment to negate the element of scienter in regard to transaction verification. In so doing, Grant points to George Banks’ deposition testimony wherein he, in effect, states he was not aware prior to the latter half of 1983 that the trades were not being verified. His averment of his own lack of knowledge, however, does not negate the element of scienter. Whether or not he had personal knowledge regarding verification of the trades does not establish whether others at Grant knew of the lack of verification. Moreover, if he possessed such knowledge in the latter half of 1983, that fact, in the face of the 1983 Hillcrest brochures stating Grant was verifying the trades, is sufficient to raise a fact issue for appellants regarding scienter. Consequently, Grant has not negated the element of scienter or the intent to induce reliance regarding transaction verification. We, therefore, sustain point of error seven in part and overrule in part. Summary judgment on the fraud-related claims concerning the tax memoranda and audits is proper. Summary judgment on the fraud-related claim concerning the failure to verify the trades is improper; that claim is returned to the trial court. Our resolution of point of error seven also disposes of points three, four, and five. RELIANCE AND CAUSATION— THIRTY-TWO PLAINTIFFS In point of error eight, appellants claim the trial court erred in granting appellee’s motion for partial summary judgment on reli-anee and causation grounds against thirty-, two of the 127 plaintiffs. A review of the Fourth Amended Petition, on which Grant’s motion for summary judgment is based, reveals the following causes of action: (1) fraud, (2) breach of warranty, (3) breach of contract/third party beneficiary to contract, (4) conspiracy to defraud, (5) negligence, (6) DTPA violations, (7) breach of fiduciary duty, (8) negligent misrepresentation, (9) aiding and abetting fraud, (10) aiding and abetting a breach of fiduciary duty, and (11) violations of the Texas Securities Act. According to Grant, either reliance or causation is an element of each cause of action in that petition. With that in mind, Grant in its partial motion for summary judgment sought to negate those elements in the following manner: Reliance Causation Fraud / Negligence Negligent misrepresentation / DTPA Civil conspiracy / Aiding and abetting fraud / Breach of fiduciary duty / Violations of Texas Securities Act / Breach of eontraet/3rd party beneficiary / Breach of warranty / At the outset, we note that causation is an element of negligence, conspiracy to defraud, and the DTPA. Appellant seeks to negate causation in the negligence and DTPA theories, but not in the conspiracy action. Reliance is an element of fraud, negligent misrepresentation, aiding and abetting fraud, and breach of express warranty. See American Tobacco Co., 951 S.W.2d at 436. However, reliance is not an element of civil conspiracy, breach of fiduciary duty, violations of the Texas Securities Act, and breach of contract and/or third party beneficiary of a breached contract, and, therefore, summary judgment is not proper on those causes of action. We are left then with the determination of whether Grant negated (1) the element of causation in negligence, and (2) the element of reliance in the causes of action for fraud, negligent misrepresentation, aiding and abetting fraud, and breach of warranty. We do not address the causation element in the DTPA cause of action, since we have already determined the investors are not consumers under the Act. We begin with the element of reliance. Grant has urged, as to the thirty-two plaintiffs in question, that they did not rely on any representations made by Grant. In support of that premise, Grant attached deposition excerpts from each of the thirty-two as summary judgment proof. According to Grant, twelve of the plaintiffs could not have relied on any of Grant’s representations, because the twelve testified they had never heard of Grant at the time they invested in Hillcrest. We do not find Grant’s initial premise to be sound. Merely because an investor does not know the specific name of the firm which has made alleged misrepresentations does not mean the investor has not relied on those representations. That fact does not aid the investors in question, however. In reviewing the deposition excerpts, it is apparent to us the testimony of the twelve does not evidence reliance, but, in fact, negates reliance. The excerpts reveal the information received by the investors concerning the Hillcrest program came from conversations with the Hendricks brothers or their agents and from material sent to them by the Hendricks organization. If any reliance was shown, that reliance was on the Hendrickses and on materials they sent to the twelve. There is no indication in the record, however, of the contents of those materials or of the substance of the conversations with the Hendrickses. The materials are variously described by the twelve as “some papers” (Andujar), a brochure or prospectus (Garvin), a folder (Jackson), “written materials” (McGee, Schatzader, Smith), brochure and letter (Mason), and written information (Wallace). The summary judgment evidence regarding those twelve investors negates the element of reliance; appellants have not responded with evidence raising a fact issue on that element. Grant next points to four of the thirty-two plaintiffs who, unlike the previous twelve, indicated they may have heard of Grant. Bimey and Bujnoch testified they had heard of Grant, but not prior to investing in Hill-crest. Gross indicated he was aware Grant was the “auditing firm” for the Hillcrest program. All four declared they became aware of the Hillcrest program through the Hen-drickses. Although their testimony reveals they may have heard of Grant, there is no indication they relied on any representations by Grant or any other accounting firm concerning the transaction with Hillcrest. Their lack of knowledge regarding any representations negates the element of reliance. It was appellants’ burden to raise a fact issue regarding the four investors’ reliance on Grant’s representations. This they did not do. Nine plaintiffs testified in deposition that they had heard of Grant; some had even received Grant’s 1983 tax memorandum. Bennett specifically stated there was nothing in the information that he found important in making the decision to invest in Hillcrest. Hayes testified that seeing the name Grant in the brochure had nothing to do with his decision to invest. Blinka stated he could not remember anyone telling him anything about Grant in connection with Hillcrest and could not remember ever reading Hillcrest material related to Grant. Williams testified he read a brochure sent to him on the Hill-crest venture; however, there is no evidence of the contents of the brochure. Tim Wilson’s understanding that Grant would handle the trades occurred only after he invested in the program. Although Christiansen testified he made his investment decision based on materials he received by mail, there is likewise no evidence of the contents of the material. Neither Wine nor Robinson knew of any connection between Grant and Hill-crest. Robinson looked through a Hillcrest brochure he received from the Hendrickses, but did not read it. Neither did he read a letter from Randal Hendricks. Wine felt the information Alan Hendricks imparted to him was important, but that was not the reason he invested. There is no indication in the record of what that information was. Norris testified he invested in Hillcrest because of his discussions with Randal Hendricks and because of the information contained in the brochure which Hendricks sent to him. Norris stated he knew an accounting firm stood behind the investment and gave it some credibility. Nowhere does he or any of the other investors indicate Grant made any representations. Any representation regarding Grant was from a third party or from a Hillcrest document, with the exception of Grant’s tax memoranda, which appellants concede contained no faulty tax advice. Grant’s summary judgment motion also directs us to four other plaintiffs who, according to Grant, did not rely on any representations made by Grant. Waldemore read through the “big blue book”, but cannot recall what was in it. He testified he talked with Randal Hendricks, read “that paper,” and talked it over with his wife. Yost remembers he received a tax opinion which mentioned Grant and “looked through it.” He testified concerning the “initial booklet” and the conversation he had with Alan Hendricks before he invested in 1983. The record does not indicate he relied on any representation by Grant. The same is true for Martz and Rosen. As revealed by the summary judgment proof, the representations concerning Grant came from third parties. Finally, according to Grant, there were three plaintiffs whose understanding of the role that Grant was to play in Hillcrest was based entirely on what others represented to them. Monge testified he had heard of Grant possibly before he made his investment, but his testimony gives no indication he relied on any representations made by Grant. Ken Bailey testified he knew Grant was an accounting firm for Hillcrest, and Grant had a duty to do an audit and advise him as an investor if there was anything wrong. His knowledge came from the Hill-crest brochure. Prior to investing, Bailey discussed with his accountant (not Grant) the fact that an “accountant firm had looked at this proposed transactions and apparently gave its blessings.” Again, the reliance is bas.ed upon representations by third parties about Grant. Heathcott also testified he relied on the representations of a third party. Specifically, he states that prior to his investment in 1982 he talked to Pete Palmer of Hillcrest who told him that Grant would provide a tax opinion and an audit. Like the other plaintiffs made the subject of this summary judgment, his reliance is upon representations by others about Grant. Appellants contend the information communicated to them regarding Grant does not have to come directly from Grant. For that proposition, they rely upon Shatterproof Glass Corporation v. James, 466 S.W.2d 873, 880 (Tex.Civ.App.—Fort Worth 1971, writ refd n.r.e.). There the court expressly held: [A]n accountant may be held liable to third parties who rely upon financial statements, audits, etc., prepared by the accountant in cases where the latter fails to exercise ordinary care in the preparation of such statements, audits, etc., and the third party because of such reliance suffers financial loss or damage. The instant case is distinguishable from Shatterproof Glass Corporation and other cases citing it. The representations here were not those of Grant. They emanated from Randal Hendricks, Pete Palmer of Hill-crest, Hillcrest marketing materials, and an accountant of one of the investors. We conclude that once Grant negated the element of reliance, as demonstrated by the deposition excerpts above, it was then appellants’ burden to raise a fact issue concerning their reliance on Grant’s representations. Their evidence does not do so. In addition to deposition excerpts referencing unidentified brochures and other written material, appellants also rely on the affidavit of Randal Hendricks to raise a fact issue regarding rebanee and causation. As with the deposition excerpts of the other investors, Randal Hendricks’ affidavit reveals the source of Hendricks’ information regarding Grant is not Grant, but Hillcrest. Hendricks declares he was informed by Pete Palmer of Hillcrest that Grant would be the accountant and auditor for Hillcrest and that Grant would be verifying the trades. Based upon Palmer’s representations, Hendricks states he mailed the Hillcrest marketing materials to the investors who, according to Hendricks, relied upon them. Hendricks’ statement in his affidavit concerning the investors’ reliance is conclusory; no basis for that knowledge is given. We conclude his affidavit, based upon information from Hillcrest rather than Grant, does not raise a fact issue regarding reliance of the thirty-two plaintiffs who are the subject of this summary judgment motion. In their response to the summary judgment motion, appellants contend they have also raised a fact issue on the element of reliance in relation to Grant’s silence in the face of its “duty to speak.” See American Tobacco Co. Inc., 951 S.W.2d at 486. If a duty to speak exists, the allegedly defrauded party must have reasonably relied on the silence to his detriment, just as with affirmative misrepresentations. ZdThe duty to speak arises in a confidential relationship. Formosa Plastics Corp., USA v. Presidio Engineers and Contractors, Inc., 941 S.W.2d 138, 147 (Tex.App.—Corpus Christi 1995), rev’d on other grounds, 960 S.W.2d 41 (Tex.1998). We do not have such a relationship here. A duty to speak also arises in at least three other contexts. Id. When one voluntarily discloses information, he has a duty to disclose the whole truth. State Nat’l Bank v. Farah Mfg. Co., 678 S.W.2d 661, 681 (Tex.App.—El Paso 1984, writ dism’d by agr.). When one makes a representation, he has a duty to disclose new information when he is aware the new information makes the earlier representation misleading or untrue. Susanoil, Inc. v. Continental Oil Co., 519 S.W.2d 230, 236 n. 6 (Tex.Civ.App.—San Antonio 1975, writ refd n.r.e.). Finally, when one makes a partial disclosure and conveys a false impression, he has a duty to speak. Ralston Purina Co. v. McKendnck, 850 S.W.2d 629, 636 (Tex.App.—San Antonio 1993, writ denied). We do not find in the record any evidence of a circumstance indicating Grant had a duty to speak. None of the situations outlined above are applicable. There was no confidential relationship between Grant and appellants, no evidence of Grant’s voluntary disclosure giving rise to a duty to disclose the whole truth, no new information conveyed by Grant which makes the earlier information misleading or untrue, no partial disclosure which conveys a false impression. Appellants did not raise a fact issue on the element of reliance in a “fraud by failure to disclose” action. We conclude the trial court was correct in granting the partial summary judgment against the thirty-two plaintiffs as to those causes of action having reliance as an element — namely fraud, negligent misrepresentation, aiding and abetting fraud, and breach of warranty. We turn now to the element of causation in negligence, which Grant also seeks to negate in its motion for summary judgment. According to Grant, “a plaintiff asserting an accounting negligence claim must show a causal link between the accountant’s departure from the requisite standard of care and the plaintiffs damages.” We find no fault with that conclusion. However, Grant’s summary judgment evidence — the deposition excerpts — do not negate the element of causation in negligence. The mere fact that some investors had not heard of Grant, were unaware of any connection between Hillcrest and Grant, or had heard of Grant from someone else has no bearing upon whether Grant’s conduct in some way caused appellants’ damage. Grant’s partial motion for summary judgment fails to negate the causation element in the negligence cause of action. The trial court was incorrect in granting partial summary judgment on the causation element in a negligence cause of action against the thirty-two plaintiffs. Point of error eight is overruled in part and sustained in part. LIMITATION GROUNDS— NEGLIGENCE, GROSS NEGLIGENCE, NEGLIGENT MISREPRESENTATION, AND BREACH OF FIDUCIARY'DUTY In point of error nine, appellants claim the trial court erred in granting ap-pellee’s motion for summary judgment on statute of limitations grounds regarding appellants’ causes of action for negligent misrepresentation, negligence, gross negligence, and breach of fiduciary duty. Each of those causes of action has a two year statute of limitations. Since appellants filed their suit against Grant on May 9, 1986, the accrual date óf each cause of action cannot be earlier than May 9, 1984; otherwise, the causes are barred by limitations. In its motion for summary judgment based on the investors’ Fourth Amended Petition, Grant urges the discovery rule is not applicable, and the only matter at issue is the accrual date of the causes of action. According to Grant, any injury appellants may have sustained occurred when they invested their funds in Hillcrest in 1982 or 1983 or when Grant allegedly committed certain breaches of duty in those same years. If one adopts Grant’s position, the various claims made the subject of this summary judgment are barred by limitations, since the accrual date would have been in 1982 or 1983, more than two years prior to May 9,1986, the date suit was filed. Taking a contrary position on the accrual date issue, appellants contend the causes of action accrued when they received notices of deficiency from the Internal Revenue Service beginning in 1985 and continuing until 1987. See Atkins v. Crosland, 417 S.W.2d 150, 153 (Tex.1967); Hoover v. Gregory, 835 S.W.2d 668, 672 (Tex.App.—Dallas 1992, writ denied). If appellants are correct, their negligent conduct and fiduciary duty causes of action are not barred by limitations, since the accrual date would have been after May 9, 1984. Alternatively, the investors argue that the causes of action are governed by the discovery rule and that they (the investors) did not discover any wrong committed by Grant until after June 24, 1985, when “certain plaintiffs learned from a Hillcrest representative that [Edward] Markowitz had pleaded guilty to a criminal information alleging violations of criminal tax statutes involving fraudulent transactions.” We conclude the discovery rule applies in this context. In general, a cause of action accrues when a wrongful act causes some legal injury, even if the fact of injury is not discovered until later, and even if all resulting damages have not yet occurred. S.V. v. R.V., 933 S.W.2d 1, 4 (Tex.1996). This rule is often referred to as the “legal injury rule.” Murphy v. Campbell, 964 S.W.2d 265, 270 (Tex.1997) The legal injury rule, however, has not been applied without exception — that exception being the discovery rule. In applying the discovery rule, the Texas Supreme Court has, under certain circumstances, held that an action does not accrue until the plaintiff knows, or in the exercise of reasonable diligence, should have known of the wrongful act and resulting injury. S.V., 933 S.W.2d at 4. “This exception ... applies in eases of fraud and fraudulent concealment, and in other eases in which ‘the nature of the injury incurred is inherently undiscoverable and the evidence of injury is objectively verifiable.’ ” Murphy, 964 S.W.2d at 270 (quoting Computer Assoc. Int’l, Inc. v. Altai, Inc., 918 S.W.2d 453, 456 (Tex.1996)). To be inherently undiseoverable, an injury need not be absolutely impossible to discover. Otherwise, suit would never be filed and the question of whether to apply the discovery rule would never arise. Id. An injury is inherently undiscoverable if it is by nature unlikely to be discovered within the prescribed limitations period despite due diligence. Id. Holding that accounting malpractice involving tax advice is inherently undiscovera-ble, the Texas Supreme Court in Murphy expressly applied the discovery rule in the accounting context. Unlike the instant case, however, the specific facts in Murphy reveal an accountani/client relationship, which is not present here. The record shows that Grant was an accountant/auditor for Hillcrest, not the investors. The investors’ status is that of third parties who claim to have relied on representations made by Grant in the course of services it provided to its client, Hillcrest. In that respect, the circumstances in the instant case are similar to those in Brown v. KPMG Peat Marwick, 856 S.W.2d 742 (Tex.App.—El Paso 1993, writ denied), wherein non-client third parties sued an auditor/ae-countant whose audit failed to disclose related party transactions. Although agreeing that liability may be imposed upon an auditor for such cause of action as negligence, regardless of a privity relationship, the El Paso court held broadly that the discovery rule does not toll limitations in a suit filed against an auditor by a non-client who charges negligence in the performance of an audit. Id. at 748-49. As we appreciate it, the basis for its holding was justice and policy considerations behind the statute of limitations. Id. at 748. We do not agree with the court’s blanket holding in Broumand instead conclude the discovery rule applies in actions involving negligence, gross negligence, negligent misrepresentation, and breach of fiduciary duty against accountants even when the claims are raised by non-client third parties. As pointed out by the Supreme Court in Murphy, an accounting malpractice claim involving tax advice to a client is inherently undiscoverable, and the injury is objectively verifiable. Murphy, 964 S.W.2d at 270. In the context of our facts, we conclude the third party’s (the investors’) actions against the auditor/aecountant Grant is no different. As with a client in the aceountant/client context, it is most unlikely that an investor would know that representations about an investment program allegedly made, or authorized to be made, by an auditor/accountant in a brochure, prospectus, or tax opinion were false or misleading at the time of investment. Otherwise, the investors would not have invested. Because we find the accounting negligence and breach of fiduciary claims under these circumstances to be inherently undiscoverable, we conclude the discovery rule applies. See Sutton v. Mankoff, 915 S.W.2d 152, 157 (Tex.App.—Fort Worth 1996, writ denied) (applying discovery rule); Ponder v. Brice & Mankoff, 889 S.W.2d 637, 641-42 (Tex.App.—Houston [14th Dist.] 1994, writ denied) (applying discovery rule). A defendant moving for summary judgment on the affirmative defense of limitations has the burden to conclusively establish that defense. Velsicol Chemical Corp. v. Winograd, 956 S.W.2d 529, 530 (Tex.1997). Specifically, the movant must (1) conclusively prove when the cause of action accrued and (2) negate the discovery rule by proving as a matter of law there is no genuine issue of fact concerning when the plaintiffs discovered or should have discovered the nature of the injury. See Burns v. Thomas, 786 S.W.2d 266, 267 (Tex.1990); DeWoody v. Rippley, 951 S.W.2d 935, 947 (Tex.App.—Fort Worth 1997, writ dism’d by agr.). Thus, Grant, as the summary judgment mov-ant, had the burden (1) of showing when appellants’ causes of action accrued in light of the discovery rule and (2) of proving as a matter of law that the investors failed to file suit within the applicable statute of limitations. If the movant establishes that the statute of limitations bars the action as a matter of law, the nonmovant must then adduce summary judgment proof raising a fact issue in avoidance of the statute of limitations. Gonzalez v. Phoenix Frozen Foods, Inc., 884 S.W.2d 587, 589 (Tex.App.—Corpus Christi 1994, no writ). The only summary judgment proof submitted by Grant as to the accrual of the causes of action consists of two deposition excerpts of Randal Hendricks and the affidavit of Grant partner, John Latta, with attachments thereto. Hendricks’ first deposition excerpt is a single page which Grant apparently submitted for the purpose of showing that the appellants who invested in 1984 had also invested in 1982 or 1983. Hendricks states, “I think the only people that we asked were the people that were in ’82 or ’83.” In the second deposition excerpt, consisting of two pages, Hendricks remarks, “[AJctually I think there was no one in ’84 that wasn’t in ’83. So there were some in ’83 who did not get into ’84. Now, that’s not confusing to me, but it’s pretty complicated.” Latta’s affidavit, based in part on information and belief, disavows any contact or communication between Grant and the investors and further avers that the 1982 tax memoranda Grant prepared for Hillcrest regarding the Hill-crest program was not to be shown to or relied upon by investors. Grant’s summary judgment evidence makes no attempt to negate the discovery rule as pleaded by appellants. Instead, the evidence, as we appreciate it, purports to establish the statute of limitations began running at the time of investment, which, according to Grant, was prior to 1984 for all plaintiffs. That evidence is not directed at appellants’ claim that they did not discover the injury until 1985. We conclude appellee did not meet its summary judgment burden. Even if the discovery rule does not apply, the summary judgment evidence still does not conclusively establish when the causes of action accrued; nor does it conclusively negate appellants’ invocation of the discovery rule. Accordingly, the trial court erred in granting summary judgment on statute of limitations grounds on the causes of action for negligent misrepresentation, negligence, gross negligence, and breach of fiduciary duty. Point of error nine is sustained. SECURITIES LAWS CLAIMS SECURITIES ACT OF 1933 § 12(1)(2) Grant filed four motions for summary judgment on appellants’ securities laws claims; on appeal, the investors challenge two of the four. In point of error ten, the investors claim the trial court erred in granting on limitation grounds the summary judgment regarding the § 12(1) and § 12(2) claims under the Securities Act of 1933. 15 U.S.C. § 111 (a)(1),(2) (1997). Grant’s motion urges two distinct reasons as the basis for its claim that the statute of limitations barred the § 12 claims. The trial court’s order on the summary judgment gives no indication which of the two grounds was the basis of its ruling. We note at the outset that appellants’ brief contains no argument on § 12(1); instead, their argument is restricted to the § 12(2) claim. Because of the absence of any argument on appeal regarding the § 12(1) claim, appellants have waived any point of error that the summary judgment on that claim was improper. See Tex.R.App. P. 74(f) (now Tex.R.App. P. 38.1(h)); Howell v. Murray Mortgage Co., 890 S.W.2d 78, 81 (Tex.App.—Amarillo 1994, writ denied). In its summary judgment motion, Grant urges that the § 12(2) claim was time barred because of the running of limitations between the filing of the Fourth and Fifth Amended Petitions. After having included it in previous petitions, appellants omitted the § 12(2) claim in the Fourth Amended Petition and then pleaded it once again in the Fifth. Grant argues that when a cause of action is dismissed or abandoned, the statute of limitations begins to run until it is again repleaded. Berry v. Humble Oil and Refining Co., 205 S.W.2d 376, 385-86 (Tex.Civ. App.—Waco 1947, writ refd n.r.e.). Therefore, under the facts in this case, the claim would be barred by limitations. We, however, follow a contrary holding of the Texas Supreme Court in American Petrofina, Inc. v. Allen, 887 S.W.2d 829, 830-831 (Tex.1994), in what we perceive to be an analogous situation. There, two plaintiff's in a multi-party, multi-cause of action suit were dropped from an amended petition but were renamed in a later petition. During the interim between the petitions, argued America Petrofina, limitations ran. The Texas Supreme Court stated that in such a circumstance “the burden should be placed on the defendant to complain of an omission in the plaintiff’s pleadings necessary to invoke the court’s jurisdiction and prevent the running of limitations.” Id. at 831. “[Djefendants [i.e., American Pe-trofina] presented no summary judgment evidence that they were prejudiced in any way by the omission and renaming of [plaintiff] .... Consistent with that provision, [plaintiff’s] claim relates back and is, therefore, not time barred.” Id. We find American Petrofina instructive in the instant case. Although the issue before us is the omission of a cause of action rather than a party, we conclude the same principles apply. Grant has not demonstrated in summary judgment evidence that it has been prejudiced by the omission and repleading of the § 12(2) claim. Furthermore, we find the pleading of the federal securities claim relates back to the same transaction or occurrence as the previous timely-filed claims. Consequently, the federal securities claims are not time barred on those grounds. We turn now to the question of whether the specific statute of limitations in 15 U.S.C. § 77m (1997) bars appellants’ § 12(2) claim. Section 12(2) claims must be brought within one year after the discovery of the untrue statement or omission, or after such discovery should have been made by the exercise of reasonable diligence. In no event shall any action be brought to enforce a liability created under section 771(2) [§ 12(2) ] of this title more than three years after the sale. See 15 U.S.C. § 77m (Section 13 of the Securities Act of 1933). Section 13 requires reasonable diligence, that is, an action must be commenced within one year after the investor either knew or should have known of the false or misleading communication. The one-year limitations period “does not ‘commence only when a plaintiff has full knowledge of the existence of a claim. On the contrary, [it] begins to run even when a plaintiff is placed on “inquiry notice” of possible misrepresentations.’”_ The First Circuit in Cook v. Avien, Inc., 573 F.2d 685 (1st Cir.1978) has referred to the circumstances constituting “ ‘inquiry notice’ ” as “storm warnings” such that a reasonable person would be alerted to the possibility of material omissions or misleading information provided_Thus, a plaintiff “may not ignore ‘storm warnings’ which would alert a reasonable investor to the possibility of fraud.” Davidson v. Wilson, 973 F.2d 1391, 1402 (8th Cir.1992) (footnote omitted) (citations omitted). A plaintiff in a federal securities ease will be deemed to have discovered fraud for purposes of triggering the statute of limitations when a reasonable investor of ordinary intelligence would have discovered the existence of the fraud. Dodds v. Cigna Secs., Inc., 12 F.3d 346, 350 (2nd Cir.1993). When the circumstances would suggest to an investor of ordinary intelligence the probability that he had been defrauded, a duty of inquiry arises, and knowledge will be imputed to the investor who does not make such an inquiry. Id. Such circumstances are often analogized to “storm warnings.” Id. “Storm warnings” of the possibility of fraud trigger a plaintiffs duty to investigate in a reasonably diligent manner and his cause of action is deemed to accrue on the date when he should have discovered the alleged fraud. Cooperativa de Ahorro v. Kidder, Peabody & Co., 129 F.3d 222, 224 (1st Cir.1997). Under Sec. 13, “even if a victim does not actually know of a misrepresentation, the one-year limitation period begins to run when the victim should have discovered the misrepresentation through the exercise of reasonable diligence.” Great Rivers Co-op. of S.E. Iowa v. Farmland Indus., 120 F.3d 893, 896 (8th Cir.1997). This objective standard is commonly referred to as the doctrine of “inquiry notice.” Id. It is a different standard than that employed for the discovery rule under Texas law where the movant in a summary judgment must conclusively negate the discovery rule. See Velsicol Chemical Corp., 956 S.W.2d at 530. The issue before us then is whether appellants have raised a fact issue as to whether they were placed on “inquiry notice” regarding the § 12(2) claims. Grant urges in its summary judgment motion that the § 12(2) claim was barred by the one year discovery provision of § 77m before appellants sued Grant on May 9, 1986. In their Fifth Amended Petition, appellants pleaded they did not discover Grant’s alleged wrongdoing “until after June 24, 1985, when certain Plaintiffs learned from a Hillcrest representative that Markowitz had pleaded guilty to criminal information alleging violations of criminal tax statutes involving fraudulent transactions.” Taking issue with that claim, Grant’s motion urges that appellants knew of Markowitz’s agreement to plead guilty “long before that, in May 1984.” As summary judgment evidence, Grant submits a Wall STREET Journal article, dated May 10, 1984, as well as the affidavit of Randal Hendricks, who admitted in both an interrogatory answer and in his deposition that in May 1984 he received a Wall STREET Journal article, which reported Markowitz had agreed to plead guilty to fraud and tax evasion charges. In his deposition, Hendricks testified he did not send the article to appellants. We dp not impute Hendricks’ knowledge of the article to appellants. Also attached as summary judgment evidence by Grant is a letter from Hillcrest “to all clients of Hillcrest Securities Corporation, Inc.” Dated May 11, 1984, Hillcrest’s letter advises its clients that it was named in the May 10, 1984, article as a company trading securities with entities owned or controlled by Edward A. Markowitz, who was “prepared to plead guilty” to tax fraud. Enclosed with the letter was a copy of the Wall Street Journal article. The letter and the