“Should have, could have, would have” not proper expert testimony—the Dallas Court of Appeals’ continued skepticism of expert opinions of what others would have done.

Business hand writing cause concept

Continuing its skepticism of expert opinions about how third parties would act under hypothetical situations (see Experts, show your work or it isn’t summary judgment evidence), the Dallas Court of Appeals affirmed a directed verdict in favor of the defendant in Axess International, Inc. v. Baker Botts, LLP based on the legal insufficiency of causation evidence. In that case, the plaintiff alleged that if Baker Botts had disclosed that it was pursuing similar patents on behalf of a competitor as well as the plaintiff, the plaintiff would have obtained different counsel, resulting in more favorable business terms in a deal with the competitor when conflict over the competing patents later came to a head.

At issue was an expert opinion from a patent attorney offered to show causation. He opined that the plaintiff would have initiated an interference proceeding and would have expanded its patent claims if the conflict had been disclosed, and that the result would have been a more favorable resolution between the plaintiff and the competitor. While noting that whether those two steps would have been taken was not clear, the Dallas Court of Appeals focused instead on whether there was evidence that those two steps would have resulted in a more favorable deal between the plaintiff and the competitor. The Court noted that because the expert offered no evidence of a similar case that was resolved favorably, there was no basis for the expert opinion that the plaintiff would have prevailed in the interference proceeding (heard this one before?). As to the expanded patent claims, the court held that the expert offered no factual basis to support his opinion as to how the USPTO would have responded to the hypothetical patent applications, again focusing on the lack of evidence regarding similar cases. And the court suggested it would be layering speculation upon speculation to assume that the mere threat of an interference proceeding or expanded patent claims would have resulted in a more favorable deal for the plaintiff without an indication as to the result of either. Thus, there was insufficient proximate cause evidence against Baker Botts and the trial court was affirmed.

Lesson learned (again): anytime your expert is saying what someone else would have done under alternative circumstances, the expert should identify specific similar factual scenarios that were considered by that third party that had the desired outcome. Otherwise, the expert’s testimony may be no evidence at all.

Axess International, Inc. v. Baker Botts, LLP

Experts, show your work or it isn’t summary judgment evidence.

Show your work

In Starwood Management, LLC v. Swaim, the Dallas Court of Appeals affirmed a summary judgment in favor of the defendant by holding that the plaintiff’s evidence of causation, an opinion from their expert witness, was conclusory and therefore not admissible summary judgment evidence. The opinion is a reminder that expert opinion evidence on summary judgment must be more than mere conclusions.

The facts of the case arose from plaintiff hiring the defendants, an attorney and his law firm, to recover an aircraft that was seized by the DEA for an allegedly illegal registration. The defendants were late in filing a claim with the DEA’s Forfeiture Counsel to recover the aircraft, causing the plaintiff’s federal claim for the aircraft to be dismissed. The affidavit offered by the plaintiff as evidence of causation was that of an attorney who had successfully represented the plaintiff in five previous aircraft seizure cases. His opinion was that if the plaintiff had timely filed its claim with the DEA such that the federal lawsuit would not have been dismissed, the DEA would have returned the aircraft as it had in those prior five case. The district court excluded the opinion and granted summary judgment in favor of the defendants.

The Dallas Court of Appeals affirmed because it held the expert’s opinion of causation was conclusory. Inexcusably passing on an opportunity to use one of this blogger’s favorite Latin phrases, ipse dixit, the Dallas Court of Appeals instead described the legal standard in less colorful but ultimately more helpful terms. “To avoid being conclusory, ‘[t]he expert must explain the basis of his statements to link his conclusions to the facts.’ An expert must also ‘[e]xplain how and why the negligence caused the injury.’” Or as I was told in math class, the expert must show his work. This expert failed to do that because, although he had past experience in other aircraft seizure cases in which the outcome was positive, he failed to describe the facts of those cases. As a result, he failed to link those cases to the one at hand, rendering his causation opinion a mere conclusion.

Starwood Management v. Swaim

“No evidence” reversal in high-profile products case

While outside the usual coverage of this blog, the high-profile products liability case of Johnson & Johnson v. Batiste provides a powerful illustration of “no evidence” review. The plaintiff alleged personal injuries from defective vaginal mesh, the jury found for her, and the Dallas Court reversed:

“It is undisputed the implantation of a [product] for the treatment of [urinary incontinence] can cause a number of complications, including erosion of the mesh into the vagina and urethral, pelvic, and groin pain. It is also undisputed that Batiste suffered from these complications. However, ‘[t]he law of products liability does not guarantee that a product will be risk free.’  Rather, to recover on her product liability claim based on an alleged design defect in the [product], Batiste was required to prove a specific defect in the [product], and not simply the device itself, was the producing cause of her injuries. . . . Although Batiste alleged the [product] was defective based on its use of mechanically cut, heavyweight, small-pore mesh that was subject to degradation and particle loss, she failed to produce more than a scintilla of evidence that any of these alleged defects caused her injuries. Accordingly, the evidence is legally insufficient to support the jury’s verdict.”

No. 05-14-00864-CV (Nov. 5, 2015, mem. op.)  (citations omitted).  Coverage of the case has recently appeared in the Dallas Observer and Dallas Morning News.

Witnesses Needed

After a night of drinking in Uptown, Shawn Strumph was found by a jogger the next morning in a creekbed beneath a bridge owned by CC-Turtle Creek. Medical records contained several versions of how he ended up there, including assault, jumping, or simply falling. Shawn and his parents sued for dram shop and premises liability, but the trial court granted no-evidence summary judgment on the element of proximate cause. Because Shawn remembered nothing of how his injuries happened, and because there were no witnesses to the incident, the plaintiffs could not carry their burden under any theory of liability.

Stumph v. Dallas Lemmon West, Inc., No. 05-14-01044-CV

Intermediaries Negate Overservice

Marco Calvillo sued the owner of the Kliff Klub — first review on Yelp: “Drinks are very strong”; second review on Yelp: “The drinks are EXTREMELY strong” — for dram shop liability after a patron of the club collided with Calvillo’s truck at 3:30 am, driving the wrong way on I-30. Testing at the hospital more than two hours after the club’s closing time showed the driver still had a .177 BAC. The county court at law granted summary judgment for the club owner, and the Court of Appeals affirmed. The patron’s deposition testimony was that she had never bought a drink at the club that night, but was instead consuming drinks bought for her daughter by various men at the club. Because the driver’s consumption was “twice removed from the provision of alcohol to the men who purchased it and gave it” to the daughter, Calvillo has no evidence that the driver was “served” alcohol within the scope of the Dram Shop Act.

Calvillo v. Frazier, No. 05-14-00013-CV

Update: Woo hoo!  We’re betting it was the on-the-nose Yelp reviews that put it over the top with the judges.


No Evidence of Causation, But Enough Damages for Remand

A landlord-tenant dispute illustrates the limits of a jury’s ability to select an amount to award as damages. After the tenant abandoned the leasehold, the landlord sued for breach of the lease agreement. The jury found for the plaintiff and awarded $200,000 in damages. On appeal, the tenant challenged the evidence of causation between the breach of the lease and the damages awarded by the jury. The Court of Appeals agreed, holding that while there was some evidence of damages caused by the breach, the evidence overall failed to establish that the specific expenses claimed by the landlord were actually made necessary by the tenant’s termination of the lease. While a jury may award damages anywhere within the range permitted by the evidence, it cannot “arbitrarily assess an amount not authorized or supported by evidence at trial.” The Court therefore remanded the case for a new trial on both liability and damages.

Curtis v. AGF Spring Creek/Coit II, Ltd., No. 05-12-00429-CV

Retaliation Suit Fails to Yield Evidence for Retaliation Suit

Today’s the day for successor cases from lawsuits in 2004. Alexandrea Crutcher originally sued DISD for discrimination and retaliation in that fateful (for 2013 purposes) year.  That lawsuit was resolved by settlement. In 2009, Crutcher interviewed for a job as a basketball coach and science teacher. After some initial recommendations that she be hired, the school hired a different candidate. Crutcher filed suit under the Texas Commission for Human Rights Act, alleging retaliation for her previous retaliation and discrimination lawsuit. Under the TCHRA, employers cannot retaliate or discriminate against an employee or applicant for filing a discrimination complaint. Tex. Lab. Code § 21.055. But Crutcher failed to meet her initial burden of coming forward with either direct or circumstantial evidence that the adverse employment decision was motivated by discriminatory purpose.

The principal who initially recommended Crutcher’s hiring did so after she learned of the earlier lawsuit, and only withdrew the recommendation later on. The person in the HR department who was responsible for making the employment decision was unaware of the first lawsuit, and a paperwork error had caused a misdescription of the job that was actually available. Allegations of hanky panky with a colleague in a supply closet also make a cameo appearance in the opinion, along with a bunch of other facts that the Court of Appeals ruled had adequately negated any causal connection between the decision not to hire Crutcher with her previous lawsuit. The Court therefore concluded that Crutcher had failed to show a prima facie case of retaliation, and that DISD has negated any showing of discriminatory intent in any case. As a result, the Court affirmed the trial court’s grant of summary judgment in favor of the school district.

Crutcher v. Dallas Indep. Sch. Dist., No. 05-11-01112-CV

No Lost Profits in the Riviera Maya

Except perhaps for emotional distress, lost profits continue to be one of the most difficult measures of damages to sustain on appeal. In this instance, Timothy Barton and two other individuals formed a corporation, JMJ Development, to develop resort properties in the Riviera Maya of Mexico. The company entered into non-binding letters of intent with both property owners and the owners of the W Hotel and St. Regis Hotel brands. Before those deals were completed, however, Barton formed a new corporation, JMJ Hospitality, and the record included evidence that he instructed the landowners to deal with the new company instead of JMJ Development. The jilted business associates sued for breach of fiduciary duty, breach of their shareholder agreement, tortious interference, and conspiracy. The jury returned a verdict of $7 million for past lost profits on the fiduciary duty claim and $3 million in future lost profits on the breach of contract claim.

The Court of Appeals reversed and rendered, concluding that there was insufficient evidence the original company ever had the ability to develop the properties in the first place. Although they had multiple letters of intent, the evidence showed those letters had expired of their own terms, and there had never been any binding contracts for the purchase or development of the properties. The meant there was no causation for the lost profits claimed by Barton’s former business owners. The plaintiffs also failed to account for subsequent events — namely, the economic recession that started after Barton formed his new company — and that failure rendered their lost profits model speculative and not reasonably certain. The plaintiffs also confused projected items of income as profits, without properly accounting for associated expenses. Without any reliable, non-speculative evidence of the plaintiffs’ lost damages, the Court of Appeals reversed the jury’s verdict and the trial court’s judgment.

Barton v. Resort Dev. Latin Am., Inc., No 05-11-00769-CV

An Accident Alone Cannot Establish Negligence

PAM Transport’s truck driver, James Herdo, allegedly backed into one of Stevens Transport’s semi-tractors.  Stevens sued PAM for negligence because it claimed Herdo failed to keep a proper “lookout” when he was backing the truck up.  The trial court found that Stevens had established that Herdo’s negligence proximately caused the collision and granted Stevens’ motion for summary judgment.  The Court of Appeals disagreed, holding that the mere occurrence of an accident does not establish negligence.  Instead, Stevens had to prove conclusively that Herdo’s failure to keep a lookout proximately caused the accident, not simply that Herdo backed into Steven’s tractor.

PAM v. Stevens