In Tour de Force, Ltd. v. Barr, the plaintiff, Tour de Force, was a Russian tour operator that entered into an agreement by email with Gordon Barr, CEO of Port Promotions. There wasn’t a separate written contract. When Tour de Force stopped receiving payments, it sued Barr individually. The trial court found after a bench trial that Tour de Force did not prove that a contract existed with Barr in his individual capacity. Tour de Force appealed, arguing that the trial court applied the wrong standard because agency is an affirmative defense. The Dallas Court of Appeals affirmed.

On the issue of whether it was the defendant’s burden to prove agency or the plaintiff’s burden to prove a contract with the defendant in his individual capacity, the Court noted that the defendant disclaimed any reliance on an agency defense during closing, meaning he had no burden to establish an affirmative defense. “Rather, the burden remained squarely with [Tour de Force] to prove a ‘meeting of the minds’ between it and Barr to enter into a contract.” The emails forming the contract included a signature line of Gordon Barr as CEO of Port Promotions, invoices were directed at Port Promotions, and payments were made from an account owned by Port Promotions. Thus, though the plaintiff testified that he believed he had contracted with Barr, there was no evidence of a “meeting of the minds” between Tour de Force and Barr in his individual capacity to enter into a contract.

Tour de Force, Ltd. v. Barr

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

In University of Texas Southwestern Medical Center v. Munoz, the Dallas Court of Appeals for the second time considered whether sovereign immunity barred the plaintiff’s claims. At the interlocutory stage, the answer was “no.” After a trial on the merits, the Dallas Court of Appeals said “yes,” and judgment was rendered for the University.

The issue in the case was whether the University had sovereign immunity from a suit arising from an injury caused by an air handling unit. If the air handling unit was personal property, the Texas Legislature waived immunity under the Texas Tort Claims Act. If it was a fixture attached to real property, then there was no waiver and the suit was barred because the plaintiff was aware of the danger.

In the first interlocutory appeal, the Dallas Court of Appeals held that the air handling unit was personal property, and thus the trial court had jurisdiction because sovereign immunity was waived. The plaintiff argued on the appeal of the final judgment that this was the law of the case. It was, after all, the same air handling unit discussed in the opinion from the interlocutory appeal.

The Dallas Court of Appeals disagreed. Noting that “[i]f the record in one appeal on a plea to the jurisdiction differs from the record on a second appeal following trial, we review the evidence challenging the existence of jurisdictional facts.” The court held that it was logical to assume the facts were better developed by the time of trial, and so it would consider those better developed facts. After reviewing those facts, the Dallas Court of Appeals concluded that the air handling unit was actually a fixture and reversed the final judgment in favor of the plaintiff. So governmental entities, despair not if you lose your interlocutory appeal, because it may turn out that the court trying your case does not have jurisdiction after all.

University of Texas Southwestern Medical Center v. Munoz

The unfortunate plaintiff in K.W. Ministries v. Auction Credit Enterprises had trouble responding to the defendant’s summary judgment motions. They were set for hearing on September 15, 2014.  On September 8, the plaintiff filed a response that addressed only one of the claims and included no evidence. Three days before the hearing, it filed a “Document Supplement” to its response, but not a motion seeking leave to file that supplement.  Then, on the morning of the hearing, the plaintiff filed an amended response accompanied by an affidavit and other materials. At the hearing, its counsel asked the court to “receive my oral motion for leave to amend and accept our response to the summary judgment that was filed this morning.” Asked why he had not provided an affidavit to support the response on the day it was due instead of that morning, counsel answered: “I don’t have a satisfactory answer for that, Your Honor.”  The response was thus not considered, and the Fifth Court affirmed, using the plain language of the relevant rule of procedure to reject plaintiff’s arguments about why it should have been.  No. 05-14-01392-CV (March 21, 2016) (mem. op.)

Celebrate St. Patrick’s Day with five recent cases to know from the Dallas Court of Appeals; click here to access the list and analysis.  And watch out for leprechauns!

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

In In re Michelin North America, Inc., the Dallas Court of Appeals conditionally granted a writ of mandamus to protect Michelin from being forced to produce certain discovery.  The district court ordered Michelin to produce specifications for tires similar to the allegedly defective tire at issue in that case in addition to financial information for the decade prior to the litigation.

The court of appeals held that Michelin satisfied its burden under Texas Rule of Evidence 507 to resist the discovery of trade secrets through the affidavit of an engineer who worked in Michelin’s legal department but that Michelin failed to satisfy its burden of proving its financial data was a trade secret because it failed to offer an affidavit until after the hearing on the motion to compel (helpful hint: it should be filed 7 days before the hearing under TRCP 193.4(a) if it is in affidavit form).  The court also held that the plaintiffs failed to meet their burden under Rule 507 to show “with specificity” exactly how the lack of information would impair the presentation of the case on the merits “to the point that an unjust result is a real, rather than a merely possible, threat.”  On the issue of financial information, though Michelin failed to timely prove its trade secrets privilege, Michelin was saved by a secondary argument that the district court’s order was too broad because the discovery included financial information from several years earlier and only current financial information is relevant for calculation of punitive damages.

In re Michelin

AdvoCare filed a petition to take a Rule 202 deposition from Michael Moussa; Moussa, joined by Shereef Kamel, counterclaimed.  AdvoCare obtained a $3,500 sanctions award against Kamel and his counsel related to that filing.  They appealed, arguing that “AdvoCare never asserted any affirmative claim for relief in the suit, the rule 202 petition has been ‘superseded and rendered moot’ by the institution of arbitration proceedings initiated by AdvoCare against Moussa and Kamel, and their counterclaims are no longer pending because they have nonsuited the counterclaims.”  The Fifth Court disagreed because no written order confirmed the nonsuit; accordingly, it dismissed for lack of appellate jurisdiction over an appealable final order. Kamel v. AdvoCare Int’l, L.P., No. 05-15-01295-CV (March 4, 2016) (mem. op.)

Edwards Sims paid A-1 $5,000 for an engine he claimed was faulty, and A-1 refused to provide a refund. Sims filed a petition in justice court seeking total damages of about $7000, within the $10,000 jurisdictional limit. After A-1 failed to appear for trial, the justice court entered a judgment for $7155.

A-1 then appealed the judgment to county court. Sims amended his petition to seek additional damages, including rental fees incurred due to the passage of time, and attorney’s fees in county court. After A-1 failed to respond to requests for admission, which were deemed admitted, county court entered a judgment for $35,730, including $21,206 in damages, including additional damages “due to the passage of time,” and $14,384 in attorney’s fees.

On appeal, A-1 claimed that the county court’s judgment exceeded the jurisdiction maximum of $10,000 for small claims cases. The court of appeals recognized that when a case is originally filed in justice court and is appealed to the county court, the county court’s appellate jurisdiction is also restricted to the $10,000 maximum. But the court held that additional damages accrued “due to the passage of time” do not deprive the court of jurisdiction. The damages incurred after the justice court judgment and the attorney’s fees incurred in county court were due to the passage of time. Thus, the Dallas Court of Appeals affirmed a $35,730 judgment on a claim that when filed was subject to a $10,000 jurisdictional maximum.

A-1 Parts Stop, Inc. v Sims