An inartfully-drafted part of the expunction statute produced a remarkable 7-6 split of the en banc Fifth Court in Ex Parte Ferris, No. 05-19-00835-CV (Oct. 2, 2020). Charles Ferris pleaded guilty to DWI in 2015. Four years later, a jury found him not guilty in another DWI matter. Ferris sought expunction of the case in which he was acquitted, and ran headlong into a particularly awkward bit of statutory drafting.

If his two DWI cases formed a “criminal episode” as defined by Tex. Penal Code § 3.01, he could not receive expunction. The statute defines “criminal episode” as:

… the commission of two or more offenses, regardless of whether the harm is directed toward or inflicted upon more than one person or item of property, under the following circumstances:

(1) the offenses are committed pursuant to the same transaction or pursuant to two or more transactions that are connected or constitute a common scheme or plan; or

(2) the offenses are the repeated commission of the same or similar offenses

(emphasis added). Part (1) did not apply, so the case turned on part (2).

The majority opinion held that application of part (2) to Ferris’s two DWI cases would create an absurd result: “Such a cabined view of what constitutes a ‘criminal episode’ creates an absurd, nonsensical result wherein a single ‘criminal episode’ would engulf two DWI arrests, which (i) share no common or continuing pattern of facts; (ii) are impossible to prosecute as multiple prosecutions under Chapter 3 of the Texas Penal Code (through joinder); and (iii) could not share a concurrent sentence.”  (Justice Petersen, joined by Justices Myers, Molberg, Osborne, Reichek, Nowell, and Carlyle).

The dissent reasoned that the majority had incorrectly blurred the two parts of the statute together, “when the plain meaning of the unambiguous text of section 3.01(2): ‘criminal episode’ means the repeated commission of the same or similar offense without limitation of time, place, same or related transaction, or conspiracy.” (Justice Evans, joined by Chief Justice Burns and Justices Whitehill, Schenck, Partida-Kipness, and Browning).

If the details of the virgule are not obscure enough for you, then you will love this wonderful article from Smithsonian Magazine about the “pilcrow,” a/k/a the paragraph symbol.

The Fifth Court found that ecclesiastical abstention barred a claim about expulsion from a private school: “Parents’ claims are premised on allegations that Prince of Peace failed to hire qualified staff and appropriately supervise its staff’s interactions with Students, including by failing to report suspected abuse of Students by its staff. Defense of these claims rests on Prince of Peace’s internal and religiously-informed policies and code of conduct. Judicial resolution of the claims would thus require impermissible intrusion in Prince of Peace’s management of these matters.” In re Prince of Peace Christian School, No. 05-20-00680-CV (Sept. 23, 2020) (mem. op.).

Adding to the Fifth Court’s thorough discussion of exactly what constitutes a “finding of fact” in In re AEJ, the Court recently reminded: “Though the parties’ appellate arguments describe oral ‘findings’ recited by the trial court, a trial
court’s oral statements from the bench do not generally constitute findings of fact. ‘Statements made by a trial court outside of properly filed written
findings and conclusions do not limit an appellate court’s review.’” WorldVentures Marketing v. Travel to Freedom, No. 05-20-00169-CV (Sept. 23, 2020) (mem. op.) (citations omitted).

If arguing that the plaintiff’s pleadings judicially admit arbitrability, be sure the record all lines up: “[T[]o the extent WorldVentures seeks to rely on a ‘judicial admission’ that TTF ‘consented to the 2019 agreements,’ the record does not show that the section 7.1 quoted in TTF’s petition necessarily came from the 2019 documents. The petition is silent as to what version of WorldVentures’ Policies & Procedures the quotation is from. Although the quoted section does not appear in the 2011 version, there were at least six additional versions in effect between 2012 and 2019. The record includes only the arbitration provision portions of those documents and does not show whether the quoted section 7.1 was unique to the 2019 version. Thus, the petition does not contain a ‘clear, deliberate, and unequivocal” statement of fact regarding consent to the 2019 agreements.'” WorldVentures Marketing v. Travel to Freedom, No. 05-20-00169-CV (Sept. 23, 2020) (mem. op.).

Cornwell v. Scothorn, discussed yesterday, also addressed whether quasi-estoppel could be a defense to a claimed breach of fiduciary duty. The Fifth Court affirmed on the basis of the charge submitted while also finding legally-sufficient evidence of reliance–the element that distinguishes “quasi-estoppel” from equitable estoppel. No. 05-18-00799-CV (Sept. 17, 2020) (mem. op.).

Cornwell v. Scothorn addressed the interplay between the opposing sides’ fraud and promissory estoppel claim. It distinguished El Paso Healthcare System v. Piping Rock Corp., 939 S.W.2d 695 (Tex. App.—El Paso 1997, writ denied), as “address[ing] whether an unclean hands defense barred recovery on a promissory estoppel claim. Piping Rock does not stand for the proposition that Stewart’s fraud in this case negated the Scothorns’ promissory estoppel claims. Ro the extent the jury found Stewart committed fraud and damaged McKinney $9427.86 in out-of-pocket damages and $8000 in damages for loss of credit reputation, we cannot conclude this finding precluded the jury from also finding that the Scothorns were entitled to damages of $201,318.04 on their promissory estoppel claim against Cornwell and McKinney.” No. 05-18-00799-CV (Sept. 17, 2020) (mem. op.).

Tom Tillotson sought to appeal two turnover orders without posting a supersedeas bond. (The Fifth Court’s opinion reminds: “A turnover order in the nature of a mandatory injunction is a final judgment that may be superseded.”) The Court agreed with him that “the amounts [in the relevant accounts] do not constitute compensatory damages,” but disagreed as to the effect of that conclusion. Because the turnover order “functions as a mandatory injunction,” it “constitutes a judgment for something other than money or an interest in property and, accordingly [Tex. R. App. P.] 24.2(a)(3) controls” rather than Rule 24.2(a)(1) about the appeal of money judgments. “Under rule 24.2(a)(3), the trial court must set a bond that will adequately protect the judgment creditor against loss or damage that the appeal might cause.” In re Estate of Tillotson, No. 05-20-00258-CV (Sept. 15, 2020) (mem. op.)

Last week I spoke (virtually) at the State Bar’s Advanced Civil Appellate Course. My topic was post-verdict motions in state in federal court; here is a copy of my PowerPoint.

Recall from a a recent post that the Fifth Court has recognized the COVID-19 pandemic as a factor to consider in evaluating motions for continuance. That same opinion reminds that trial courts have substantial discretion to conduct virtual trials in an appropriate case:

We also hold that the trial court did not abuse its discretion by overruling Relator’s objection to trial via videoconference. In its emergency orders, the supreme court expressly granted trial courts the discretion, “subject only to constitutional limitations” and “without a participant’s consent,” to require that all participants in hearings, depositions, “or other proceeding[s] of any kind” participate remotely, “such as by teleconferencing, videoconferencing, or other means.” Emergency Order 1, ¶ 2(b); Emergency Order 17, ¶ 3(c). Although the emergency orders do not specify bench trials, these would easily fall under the category of “other proceeding[s] of any kind.” Relator has not claimed that a bench trial by videoconference would violate any of his constitutional rights, so the trial court did not abuse its discretion in requiring Relator to participate in this manner.

(citations omitted).

Orange Cup Drive In LLC v. Mid-Continent Casualty Co. illustrates the application of the rules about the grounds for summary judgment motions:

• General rule. “Granting summary judgment on a claim not addressed in the motion is, as a general rule, reversible error.’ The supreme court has recognized a harmless error exception to this rule “when the omitted cause of action is precluded as a matter of law by other grounds raised in the case.” (citations omitted).
• Insurance law. “[S]ome claims for common law or statutory violations may exist even where there is no coverage under the policy.”
• Thus: “Where the motion is silent on grounds for summary judgment for the extracontractual claims—and particularly where the motion specifically recites that the claims will be addressed by a separate motion later—we cannot determine whether ‘the omitted cause of action is precluded as a matter of law by other grounds raised in the case.'”

No. 05-19-00014-CV (Aug. 28, 2020) (mem. op.)

The paternal-rights case of In re AEJ fully reviewed the somewhat-untidy law about Tex. R. Civ. P. 299 and its consequences, and made these observations and conclusions. As to the requirements of the rule:

• Tex. R. Civ. P. 299 says: “Findings of fact shall not be recited in a judgment. If there is a conflict between findings of fact recited in a judgment in violation of this rule and findings of fact made pursuant to Rules 297 and 298, the latter findings will control for appellate purposes. Findings of fact shall be filed with the clerk of the court as a document or documents separate and apart from the judgment.” (emphasis added);
• One line of Fifth Court cases holds “that findings in the body of a judgment ‘are inappropriate and may not be considered on appeal’.”;
• However, another line of Fifth Court cases says that “[b]ecause the record does not contain any additional findings of fact or conclusions of law, the findings in the
  judgment have probative value and will be treated as valid findings.”

The Court found that on this record, the trial court made adequate findings in a  memorandum ruling (observing, in a footnote, that the Court was not bound by the lable placed on findings by the trial court). The Court also found no harm from any lack of findings, noting that the record and issues were well-defined and straightforward. It concluded with a practical observation: “And finally, in this case the remedy for a failure to make findings would be to abate the appeal and direct the trial judge to file findings on endangerment and best interest—presumably the very findings she has already made twice.” No. 05-20-00340-CV (Aug. 31, 2020).

The TCPA applied in Keel Recovery v. Tri County Adjusters because the suit was based on a police report–an act of petition. As to the prima facie case, the Fifth Court held:

“[W]hile Arion may have had a fiduciary duty to her employer, TCA, that does not mean she owed any fiduciary duty to Peters as owner of TCA. Arguably, to the extent Arion owed TCA a fiduciary duty, that duty was fulfilled by reporting Peters’ criminal activity that could subject TCA to negative consequences.” 

No. 05-19-00686-CV (Sept. 4, 2020) (mem. op.).

The trial court did not abuse its discretion in finding an arbitration agreement procedurally unconscionable when: “Herman testified in his affidavits that the meeting with appellant [law firm]’s employee was less than ten minutes. Herman made a brief statement to the employee explaining the accident, and the employee told Herman to sign a document. Herman asked the employee if the document was a contract, and the employee answered, ‘No, we are just gathering information,’ that the Daspit firm would review the facts, and that a lawyer would call him. The employee was ‘very impatient’  and told Herman ‘he could not stay to explain things.’ Herman also testified that when he signed the document, he ‘did not understand . . . that it contained an arbitration clause.’ Herman argues appellant’s employee did not permit Herman to read the arbitration provision before signing the document.” Daspit Law Firm v. Herman, No. 05-19-00615-CV (Aug. 25, 2020) (mem. op.)

In a 1981 survey of family-court judges, D Magazine memorably quoted a lawyer: “If all judges were light bulbs, Judge Annette Stewart would be a floodlight – 200 watts . . . ” The first woman to serve as a Justice of the Fifth Court recently passed away.

The Texas Supreme Court recently entered an order amending (effective Jan. 1, 2021) several rules of civil procedure about discovery, including:

• Amendment of Tex. R. Civ. P. 47, 169, and 190 so that expedited discovery procedures will apply to any case with $250,000 or less in controversy (amended from $100,000). This also changes the Rule 47 pleading requirement.
• Rule 194 is amended to follow Fed. R. Civ. P. 26 and require initial disclosure of, among other matters,“all documents, electronically stored information, and tangible things that the responding party has in its possession, custody, or control, and may use to support its claims or defenses, unless the use would be solely for impeachment.”

Thanks to my LPHS colleague John Adams for his careful review of this order.

Batson issues are doubly complex–they involve (1) appellate scrutiny of a discretionary decision made “live” under time constraints, and (2) inquiry into motive based on objective manifestations of the motive in juror questions, strike patterns, etc. It is no surprise, then, that reasonable minds can differ, as they did in United Rentals v. Evans. The panel found no Batson violation after a detailed review of the relevant record; three Justices dissented from the denial of en banc review, keying on counsel’s statement that “[w]e know from our focus groups that the African-American female is the most favorable juror for this case for whatever reason.” No. 05-18-00665-CV (Aug. 18, 2020).

The London Underground reminds its riders to “Mind the Gap” so they do not trip when entering or exiting a train. The Fifth Circuit’s new typography places a notable gap between paragraphs and footnotes. While this sort of line-spacing does not have a technical label like “kerning,” it is nevertheless an important part of the overall look and feel of a piece of legal writing. What are your thoughts on inter-paragraph line spacing? 

After an earlier dispute about the merits of an interlocutory stay, the Fifth Court reached the substantive issue of arbitrability in Baby Dolls v. Sotero, a personal-injury lawsuit about a serious car accident involving two dancers after they left work. The key question was the interplay of the terms “License” and “Agreement” in the relevant contract; the panel majority concluded: “On this record, we conclude the trial court could have properly determined the parties’ minds could not have met regarding the contract’s subject matter and all its essential terms such that the contract is not an enforceable agreement. Consequently, the trial court did not abuse its discretion by denying the motions to compel arbitration.” (citations omitted). A dissent disputed whether that conclusion was a proper legal basis to deny a motion to compel arbitration, and would have reached a different result about the construction of the parties’ contract. No. 05-19-01443-CV (Aug. 21, 2020) (mem. op.)

In re: Sakyi reminds: “the unique and serious circumstances created by the COVID pandemic require flexibility and adaptability in all aspects of our legal system.” the Court went on to grant mandamus relief about the the denial of a motion for continuance, observing: “In this case, all factors weigh in favor of concluding that the trial court’s denial of the continuance was an abuse of discretion. First, this case is not old; at the time the continuance was sought, the case had been on file for less than a year. Second, the discovery sought is central to the underlying divorce suit since RPI’s marriages, if overlapping, may affect the determination of what property is in the marital estate at issue and raise equitable considerations of possible fraud. Indeed, the trial court acknowledged that the conflicting marriage dates created an issue of fact. Third, Relator’s counsel submitted an affidavit describing her diligent efforts to obtain the necessary discovery before trial.” No. 05-20-00574-CV  (Aug. 20, 2020) (mem. op.)

Sometimes to state the issue is to decide it. For example, the Fifth Court’s opinion in Ruff v. Ruff began: “A pivotal question we address is whether a party can initiate an arbitration proceeding pursuant to a specific arbitration agreement, demand that a signatory to that agreement be compelled to participate in that arbitration, and then disavow the resulting award by alleging that he (the initiating party) did not agree to arbitrate according to that arbitration agreement.” The Court answered that question “no,” reviewing the invited-error and several estoppel doctrines. No. 05-18-00326-CV (Aug. 11, 2020).

Damages were not established in In the Interest of MGG, No. 05-19-00777-CV (Aug. 10, 2020) (mem. op.), when:

“Ms. Gatewood does not dispute that Mr. Gustafson and his employer paid the withheld amounts to the IRS to cover the taxes from the transactions. Nor does she dispute that, if Mr. Gustafson instead paid her 100% of the gross proceeds, she would have to pay those taxes. The only theory of harm Ms. Gatewood advanced in the trial is that, by withholding and paying taxes based on his own tax rate instead of hers, Mr. Gustafson forced her to pay taxes at a higher rate. The proper measure of damages for that harm, however, is the difference between the taxes she would have paid at her purportedly lower tax rate and the amount Mr. Gustafson paid the IRS. To prove Mr. Gustafson harmed her in that manner, Ms. Gatewood had to prove there was a disparity between their tax rates.

Ms. Gatewood refused to turn over her tax records during discovery and chose not to present evidence establishing her tax rate at the trial. The only record evidence directly touching upon Ms. Gatewood’s tax rate is her affirmative response to a hypothetical question asking whether she was ‘at least hopeful’ her tax rate would be lower if she received the money Mr. Gustafson paid the IRS. That conclusory response, premised on Ms. Gatewood’s hope or belief, is insufficient to show Ms. Gatewood’s tax rate would have been lower.” (emphasis added).

In re Smith held that the statutory stay of certain discovery in health-liability claims did not apply to policies that nursing homes are required to make publicly available. As to the availability of mandamus relief, the Court observed: “It is well settled that mandamus relief is appropriate when the trial court
abuses its discretion by ordering discovery precluded by section 74.351(s). However, it is not clear whether the same is true when the trial court prohibits discovery that the statute permits.” (emphasis in original, citation omitted). The Court concluded that it was appropriate because of the potential effect on the statutorily-required expert report. (While the Court cites, inter alia, a general proposition from the Texas Supreme Court about mandamus relief, it remains to be seen how much weight this case will have in other settings without a similar expert report requirement.) No. 05-20-00497-CV (Aug. 12, 2020) (mem. op.).

McGuire-Sobrino v. TX Cannalliance LLC presents a mini-course on effective protection of business information. Cannalliance sued McGuire-Sobrino, a former contractor, for restricting its access to its website and other digital assets. The Fifth Court addressed

• Rule 683. The temporary injunction made adequately-detailed findings, which the Court quoted largely verbatim;
• Irreparable injury. Rejecting the argument that Cannalliance’s proof of irreparable injury showed only “a fear of possible contingencies,” the Court credited testimony of its managing member that “his inability to control Cannalliance’s digital assets and website is ‘crippling our ability to market and promote our events, to sell tickets to support the business’ and … ‘can smear the public perception and paint a bad picture of the ability to have control over our business.'”
• Likelihood of success. Cannaliance showed a likelihood of success on claims for conversion and trademark infringement; and
• Status quo. The injunction preserved the status quo by “returning the parties to their pre-September 26, 2019 status” (the date when Cannalliance showed it no longer had full access to its digital assets).

No. 05-19-01261-CV (Aug. 10, 2020) (mem. op.).

Palladium Metal Recycling v. 5G Metals reminds: “Interlocutory appeals are only available from orders denying TCPA motions, not from orders granting them.” As to that granted motion, the Court also observed in a footnote: “Notably, in the event the trial court’s ruling has not become final and appealable, the trial court retains jurisdiction to vacate its order regarding St. Charles should it decide to do so.” No. 05-19-00482-CV (July 28, 2020) (mem. op.)

The Fifth Court reversed an award of sanctions, based on the trial court’s exercise of its inherent power, in In re Estate of Powell: “The trial court’s orders reflect that it made the attorney’s fees award as a sanction for Douglas’s and Putnam’s bad faith violation of the rule 11 agreement. Although there is some evidence supporting the trial court’s finding that Douglas and Putnam acted in bad faith, the trial court did not also find or conclude that Douglas’s and Putnam’s bad faith conduct significantly interfered with the court’s ‘legitimate exercise of its core functions.’ Consequently, we conclude the trial court abused its discretion by imposing the sanction against Douglas and Putnam.” No. 05-19-00689-CV (Aug. 4, 2020) (mem. op.) (citations omitted) (applying Union Carbide Corp. v. Martin, 349 S.W.3d 137 (Tex. App.–Dallas 2011, no pet.)

“[Tex. R. Civ. P.] 11 provides that ‘no agreement between attorneys or parties touching any suit pending will be enforced unless it be in writing, signed and filed with the papers as part of the record, or unless it be made in open court and entered of record.’ The purpose of the rule is to relieve the courts of the necessity of resolving disputes over the terms of oral agreements relating to pending suits. As explained in [Anderson v. Cocheu], however, in enforcing rule 11 [agreements] ‘the Texas Supreme Court has been mindful of the fact that the rule may be said to abridge the substantive right of persons to enter into oral contracts.’  Consequently, courts have balanced the purpose of the rule with the ability to make oral agreements, resulting in recognition of certain equitable exceptions to rule 11’s writing requirement. One exception to the writing requirement arises when the oral agreement is undisputed. ‘In cases where the existence of the agreement and its terms are not disputed, the agreement may be enforced despite its literal noncompliance with the rule.’”  In re Estate of Powell, No. 05-19-00689-CV (Aug. 4, 2020) (mem. op.).

In re Commitment of Barnes, No. 05-19-00702-CV (Aug. 5, 2020) (mem. op.), involved a challenge to a voir dire limitation. The trial was to determine whether Barnes should be civilly committed as a sexual predator. His counsel sought to ask these voir dire questions, which the trial court found to be improper “commitment” questions:

 “If you hear evidence of a pedophilic disorder diagnosis, if you hear evidence of child victims, are you going to automatically assume that the person has a behavioral abnormality as defined by what you hear in this case?”

– and –

“If you are presented with evidence by an expert that the diagnosis of a person is pedophilic disorder, are you going to automatically assume that that person has a condition that by [a]ffecting the emotional or volitional capacity predisposes the person to commit a sexually violent offense to the extent that they become a menace to the
health and safety of another person?

The Fifth Court found that this ruling was erroneous, but also no harm because, inter alia, a similar question was allowed: “If you hear evidence of child victims,
is that going to make it to where you turn everything off and don’t listen to the rest
of the facts and you are done? Anyone?”

To review the propriety of the question, the Court applied a 3-part test based on the Court of Criminal Appeals’ Standefer opinion:

1. “[W]hether this is a commitment question, meaning one to which ‘one or more of the possible answers is that the prospective juror would resolve or refrain from resolving an issue in the case on the basis of one or more facts contained in the question.’” The Court held that it was, because “one answer is that the juror would automatically find a behavioral abnormality if the juror hears evidence of pedophilic disorder or child victims.”
2. “[I]s this commitment question proper, meaning one of the possible answers gives rise to a valid challenge for cause.“ The Court held that it was, noting: “The law requires a ‘certain type of commitment from jurors’ in every trial, and that includes following the law.” From there, the Court held: “If a juror answered that she would stop listening to additional evidence regarding ‘behavioral abnormality’ after hearing a diagnosis of pedophilic disorder or hearing of prior child victims, that juror would be committing to not listening to all the evidence. It would not be a ‘fact-specific opinion,’ but rather evidence of a disqualifying and ‘improper subject-matter bias.'”
3. “[D]oes the question contain ‘only those facts necessary to test whether a prospective juror is challengeable for cause.'” Here, where “[t]he subject matter of the case was child victims and a pedophilic disorder diagnosis,” the Court concluded: “The question added no more, especially in light of what the State had previously introduced to the venire, and thus contained only the facts necessary to test whether the juror is challengeable for cause.”

The ABA House of Delegates has recently adopted a comprehensive set of best practices for litigation funding–an important topic in modern law practice.

The plaintiffs in In re Outreach Housing sought to enforce a (revived) 2006 default judgment that was not final under the applicable standards. The Fifth Court granted mandamus relief as to the trial court’s denial of the defendants’ motion to stay. It found an abuse of discretion in that decision, with irreparable consequences arising from the denial of a meaningful appeal from the 2006 judgment, and some parties’ lack of a meaningful trial. The Court acknowledged a technical point about a potential interlocutory appeal from the denial of the motion, but found that matter too speculative to deny mandamus relief in these circumstances. No. 05-20-00431-CV (July 30, 2020).

The Governor has directed that certain government flags fly at half-staff on August 1 in the memory of Justice Bridges.

(An expanded version of this post appears this week in the Texas Lawbook.)

Cyberpunk stories often describe the physical world as meatspace, as distinct from the online world of cyberspace. Litigation forces courts to consider the connection between the two “spaces” when a party contests the exercise of personal jurisdiction based on online activity. While precise definition of a website’s functionality can involve technical terms, the jurisdiction analysis involves familiar concepts, as illustrated by Shopstyle, Inc. & Popsugar, Inc. v. Rewardstyle, Inc.:

Purposeful availment. “[W]hen using the Shop feature, the user cannot purchase products on the PopSugar website but instead follows links to the websites of affiliated third-party retailers. In other words, the ‘user cannot consummate a commercial transaction online without accessing and logging-into a third-party website.'”

Operative facts. “Whether PopSugar’s website is available in Texas or whether links to Texas-based retailers are available on PopSugar’s website is unrelated to the operative facts as alleged by rewardStyle. The record contains no allegations or evidence of which we are aware that the alleged operative conduct occurred in Texas or that it has anything to do with Texas, apart from the fact that rewardStyle and one of its influencers are located here.”

Third-party activity. “[E]even if another party creating ShopStyle links and adding them to allegedly misappropriated images was considered an affirmative act by ShopStyle (and we are not so concluding), permitting hyperlinks to the websites of third-party Texas-based retailers where products can be purchased “would not demonstrate, by itself, that  [ShopStyle] controls the third-party sufficiently for sales from the third-party’s website to constitute ‘contacts’ by [ShopStyle].”

No. 05-19-00736-CV (July 21, 2020) (mem. op.). Of procedural interest, this case arose from a presuit discovery request under Tex. R. Civ. P. 202.

The legal structure of local government has received great scrutiny this year as the COVID-19 pandemic has forced all levels of state government to review the emergency powers granted by the Texas Government Code. Less-trendy but also-fundamental aspects of local government operation were at issue in Carruth v. Henderson, when a citizen sought mandamus relief to require the City of Plano to consider a referendum petition about the City’s comprehensive development plan. The Fifth Court expressed sympathy for the City’s position, but found that under the applicable statutes, it had a ministerial duty to accept the petition as “neither the [City] Charter nor the general law has withdrawn comprehensive plans either expressly or by necessary implication from the field in which the referendum process operates …” No. 05-19-01195-CV (July 22, 2020). I am quoted in an excellent column about this situation by Sharon Grigsby in the July 28 Dallas Morning News.

Long-serving Justice David Bridges was killed this weekend when his car was struck by a drunk driver. This shocking news is a loss for all North Texas.

In addition to a thorough review of Batson law as applied to Hispanic potential jurors,  Murphy v. Mejia Arcos provides a powerful example of the rules about post-trial pleading amendments.

On the one hand, “pursuant to rules 63 and 66 of the Texas Rules of Civil Procedure, a trial court must allow a postverdict amendment that increases the amount of damages sought in the pleadings to that found by the jury unless the opposing party presents evidence of prejudice or surprise.” (emphasis added)

But at the same time, “a trial court cannot grant a motion for leave to amend the pleadings after the court signs the judgment.”

Accordingly, the trial court abused its discretion when it (1) signed a final judgment, (2) granted the plaintiff’s motion to amend the pleadings, and then (3) signed a new judgment without an order setting aside the first one. “Because the trial court never signed a written order vacating the August 9, 2018 final judgment, its oral pronouncement [about vacating that judgment] was ineffective, so the August 9,
2018 judgment continued in force and effect. . . . [A]t all times after August 9, 2018, there has always been a final judgment in this case. Therefore, the trial court did not follow the guiding principles of law that it cannot grant leave to file an amended pleading after judgment.” 

As a result, the judgment was reduced to $200,000 (the maximum amount sought specified by the plaintiff’s trial pleading) from the $1,000,000 awarded in the jury’s verdict. No. 05-18-01342-CV (July 17, 2020).

The principle is easy enough to state — because the mandatory-venue statute about injunctive relief “is limited to suits ‘in which the relief sought is purely or primarily injunctive[,] . . . it does not apply when the injunctive relief is ancillary to the other relief sought . . . where the injunctive relief is requested simply to maintain the status
quo pending resolution of the lawsuit.” In re: Zidan shows that reasonable minds can differ about its application, however. The majority opinion saw the plaintiff’s request for injunctive relief as ancillary to the central dispute about the governance of a business entity; the dissent saw it as sufficiently central to implicated the statute. The Fifth Court’s judgment conditionally granted mandamus relief with respect to a Collin County judge’s decision to abate a first-filed case in favor of a Harris County matter. No. 05-20-00595-CV (July 15, 2020) (mem. op.)

Please check out my new podcast, Coale Mind, where once a week I talk about constitutional and other legal issues of the day. This forum lets me get into more detail than other media appearances, while also approaching issue from a less technical perspective than blogging and other professional writing. I hope you enjoy it and choose to subscribe! Available on Spotify, Apple, and other such services.

While jury selection is a critical and at times outcome-determinative part of trial, appellate opinions on voir dire issues are scarce – trial judges have considerable discretion in such matters and harm is difficult to establish. All the more reason for trial lawyers to carefully review Murphy v. Mejia Arcos, a painstaking analysis of Batson challenges to peremptory strikes of Hispanic jurors. Carefully applying the precedent in the area, the Fifth Court found no abuse of discretion by the trial court in sustaining two such challenges in a personal-injury trial. The analysis is of obvious statewide significance for Texas practice, offering a practical summary of the current Batson procedural framework, and having important policy consequences for an infrequently-reviewed aspect of civil trial practice. No. 05-18-01342-CV (July 17, 2020).

“Care Tecture contends the trial court could not consider the [Mediated Settlement Agreement] because it was not physically attached to the motion or an affidavit. Matheson argues that the MSA was properly before the court because it was on file with the court at the time of the summary judgment hearing, referenced in the motion for summary judgment, and authenticated by the affidavits. We agree with Matheson. See Kastner v. Jenkens & Gilchrist, 231 S.W.3d 571, 581 (Tex.App.—Dallas 2007, no pet.) (noting that the rules “do not require that summary judgment evidence be physically attached to the motion”). Care Tecture v. Matheson Commercial Properties, No. 19-00591-CV (June 30, 2020) (mem. op.)

Shylock sought to exact a pound of flesh from a debtor in The Merchant of Venice (right, played by Al Pacino). In Selinger v. City of McKinney, a form of taking called an “exaction” was at issue, when “[Plaintiffs] alleged that the City denied Selinger’s plat because he refused to agree to a contingent $482,000 payment as a condition of plat approval. Those facts amount to an exaction … .” The conditional nature of an exaction leads to unusual questions about ripeness and mootness, as well as governmental-immunity issues, all of which were resolved by the Fifth Court substantially in favor of the Plaintiffs. No. 05-19-00545-CV (July 1, 2020) (mem. op.)

Armbrister’s car was repossessed. She sued the lender because it had unlawfully refused to deduct her payment from a Federal Government Federal Reserve Bank account. She had acquired the rights to this account, she alleged, because of her work for the  FBI, the NSA, and the Defense Department on an artificial intelligence team; those agencies had authorized her by neural communication to pay all of her bills from an account at the Federal Reserve. Unfortunately for Armbrister, her claim did not satisfy the demands of Tex. R. Civ. P. 91a, and the Fifth Court affirmed. Armbirster v. American Honda Finance Corp., No. 05-19-00593-CV (July 10, 2020) (mem. op.) The opinion did not address whether neural communication satisfies the statute of frauds, or whether the relevant government agencies may have immunity defenses to fraudulent-inducement claims by Armbrister.

On the facts of California Commercial Investment Group v. Herrington, “even
though the charges were dropped, [Defendant’s] statements made to police are protected as an exercise of the right to petition and of free speech.” The Fifth Court went on to find that no prima facie case was made on the plaintiff’s malicious-prosecution and defamation claims, and reversed the trial court’s denial of the defendant’s TCPA motion to dismiss. No. 05-19-00805-CV (July 8, 2020) (mem. op.).

The initials “JM” appeared on drawings ARCO (a consulting firm) prepared for products designed by Kendall Harter (an inventor and entrepreneur). The appellant in KBIDC Investments v. Zuru Toys, a case about the design of water-balloon devices, argued that Josh Malone worked for ARCO and was exposed to Harter’s ideas at ARCO, noting: “that the initials ‘JM’ appear on drawings ARCO prepared for other products designed by Harter, including drawings for a sandwich maker and a water-balloon gun. Appellant also points to Malone’s Linkedin.com profile, which states that his technical skills include ‘CAD,’ computer-aided design. Appellant also asserts, without citing any evidence other than Harter’s affidavit, that Malone’s house was ‘within a 30-minute drive of ARCO’s offices’ in Farmer’s Branch. Appellant also asserts that ARCO had no employees with the initials ‘JM’ at that time.” The Fifth Court saw this evidence differently, finding: “This evidence is too indefinite and uncertain to show Malone had access to Harter’s designs. It does not constitute circumstantial evidence that Malone worked at ARCO, that he had access to Harter’s provisional patent application or drawings, or that he misappropriated Harter’s trade secrets.” No. 05-19-00159-CV (June 26, 2020) (mem. op.) – and on rehearing (Oct. 9, 2020). 

The appellant in KBIDC Investments v. Zuru Toys contended that the appellees failed to segregate attorneys’-fee evidence among claims involving the Texas Theft Liability Act (compensable) and those for misappropriation of trade secrets and unfair competition (not compensable). The Fifth Court observed that a basic holding of Tony Gullo Motors v. Chapa, 212 S.W.3d 299 (Tex. 2006)–that “it is only when discrete legal services advance both a recoverable and unrecoverable claim that they are so intertwined that they need not be segregated”–was not overruled by Horizon Health Corp. v. Acadia Healthcare Co., 520 S.W.3d 848 (Tex. 2017), which as a factual matter found a failure to properly segregate fees related to a TTLA claim. Here, “[Appellees’] argument is that all of their attorney’s fees were reasonable and necessary to their prevailing on appellant’s TTLA claim. Their attorney testified to that fact. He also testified that the attorney’s fees would have been the same if the TTLA claim had been the only claim. Appellant does not identify any invoice entry that did not apply to the TTLA claim.” No. 05-19-00159-CV (June 26, 2020) (mem. op.).

 “…the power granted by section 22.221(a) of the government code is not a power that is granted to prevent damage to the appellant pending appeal.’ ‘That purpose is served by the statutes allowing appellants to supersede judgments by posting an appropriate bond.’ Rather, the power to issue a writ of injunction is limited to the purpose of protecting appellate jurisdiction. 

   Here, relators assert that the pending foreclosure threatens this Court’s jurisdiction over their existing appeal. But unlike the cases cited by relators involving appeals of interlocutory orders, the foreclosure of the property at issue does not moot their claims in the appeal and, thus, does not implicate the Court’s jurisdiction over the appeal.” In re Day Investment Group, No. 05-20-00643-CV (July 2, 2020) (mem. op.) (citation omitted, emphasis added).

When not engaged in good-natured banter about typeface or proper spacing after periods, the appellate community often argues about the right place to put citations to authority. The traditional approach places them “inline,” along with the text of the legal argument. A contrarian viewpoint, primarily advanced by Bryan Garner, argues that citations should be placed in footnotes.

Has modern technology provided a third path? Professor Rory Ryan of Baylor Law School advocates “fadecites,” reasoning:

A brief using this approach would look like this on a first read:

(A longer example is available on Professor Ryan’s Google Drive.) The reader can quickly skim over citations while reviewing the legal argument. Additionally, assuming that the court’s technology allows it, case citations can be arranged to become more visible if the reader wants to know more information. Modern .pdf technology allows a citation to become darker and more visible if the reader places the cursor on it. A hyperlink to the cited authority could also be made available.

This idea offers an ingenious solution to a recurring challenge in writing good, accessible briefs. I’d be interested in your thoughts and Professor Ryan would be as well.

This is a crosspost from 600Hemphill, which follows business litigation in the Texas Supreme Court. 

The Texas Supreme Court recently summarized the sometimes-confusing law about preservation of objections an an expert’s testimony:

“Requiring an admissibility objection to the reliability of expert testimony gives the proponent a fair opportunity to cure any deficiencies and prevents trial and appeal by ambush. Thus, when an expert opinion ‘is admitted in evidence without objection, it may be considered probative evidence even if the basis of the opinion is unreliable.’ But conclusory or speculative opinion testimony is not relevant evidence because it does not make the existence of a material fact more or less probable. Evidence that lacks probative value will not support a jury finding even if admitted without objection. ‘Bare, baseless opinions will not support a judgment even if there is no objection to their admission in evidence.'”

Pike v. Texas EMC Management LLC, No. 17-0557 (June 19, 2020). While this quote eliminates the case citations in the original, the cited authorities provide further discussion of these principle and illustrate their applications in specific settings.

This is a crosspost from 600Hemphill, which follows business litigation in the Texas Supreme Court. 

In Pike v. Texas EMC Mangagment LLC, ”‘Value’ was defined in the jury charge as ‘”Market Value,”’ the amount that would be paid in cash by a willing buyer who desires to buy, but is not required to buy, to a willing seller who desires to sell, but is under no necessity of selling.’”

Expert testimony sought to establish a $4.1 million value for the relevant plant and equipment, which the Texas Supreme Court rejected for three reasons:

“First, … [e]vidence of the purchase price of the Partnership’s property is insufficient under that measure because it does not establish the fair market value of the property at a different time.”

“Second, …[c]ourts employing an actual-value measure have held that ‘[f]rom that starting point, adjustments are made for wear and tear, depreciation, and other pertinent factors.’ Having examined the record, we disagree with the plaintiffs that [the expert] took anything other than purchase price—and a 20% escalation factor—into account in opining about the value of the plant and equipment.”

“Third, [the expert] did not attempt to tie the value of the plant to the market value of the
Partnership, which was the only measure of damages in the jury charge. He did not address whether any debt encumbered the plant, for example, or otherwise testify regarding how loss of the plant and equipment impacted the value of the Partnership as a whole.” (emphasis added, citations omitted)

The Court also rejected efforts to corroborate the expert’s testimony with lay-opinion testimony by an owner, because that testimony was based on book rather than actual value. Foreclosure-sale price was similarly irrelevant. No. 17-0557 (June 19, 2020).

In re Perl granted mandamus relief as to jurisdictional discovery requests.

As to scope, it reasoned (as to one set of the requests): “Interrogatory No. 2’s request for “details of how business is conducted between” Relators and Cake Craft, Interrogatory No. 8’s request for Relators’ “work, role and/or services” to Cake Craft, Request for Production No. 5’s requests for documents “regarding your engagement and business relationship” with Cake Craft, and Request for Production No. 15’s request for documents “that detail the inspecting and auditing services that you performed on the Cake Craft defendants” do not focus on any jurisdictional fact. None of these requests are confined to any of the three purposeful availment factors: Relators’ own activities, aimed at Texas, or the specific benefit, advantage, or profit Relators would earn from a Texas relationship.” (emphasis added)

As to adequate remedy, in response to the argument that “the only injury claimed is the ordinary expense of litigation,” the Court observed: “[A]llowing discovery of a potential claim against a defendant over which the court would not have personal jurisdiction denies him the protection Texas procedure would otherwise afford.” No. 05-20-00170-CV (June 2, 2020). LPHS represented the real parties in interest in this case.

On June 12, the Fifth Court revisited the ongoing litigation about Downtown Dallas’s much-reviled Confederate memorial, by granting the City’s emergency motion to put the memorial in “archival storage” in light of protests in the downtown area.

Lunch-buying did not create arbitrator bias in Texas Health Management v. Healthspring: “THM next claims the Tribunal was partial because it received free beverages and meals from Healthspring every day of the hearing. THM claims it received this information from a December 5, 2017 letter from Healthspring to the Tribunal. However, on the first day of arbitration, Appel acknowledged, “I understand, Mr. Leckerman, you ordered in lunch.” Leckerman, Healthspring’s attorney, confirmed lunch would arrive around noon. THM did not question or object to Healthspring providing lunch.” (footnote omitted).

This is a cross-post from 600 Hemphill

It’s not a Texas Supreme Court case, but Title Source Inc. v. HouseCanary Inc. is a jury charge case worth reviewing. In it, the San Antonio Court of Appeals reversed a $700+ million judgment based in part on a classic Casteel issue. In reviewing the jury instruction about the plaintiff’s claim for theft of trade secrets, the Court observed:

“[T]he jury was also instructed that ‘improper means’ includes bribery, espionage, and ‘breach or inducement of a breach of a duty to maintain secrecy, to limit use, or to prohibit discovery of a trade secret.’ This instruction tracks TUTSA’s definition of ‘improper means’ and is therefore a correct statement of law. But HouseCanary conceded at oral argument that there is no evidence TSI acquired the trade secrets through bribery, and our review of the record reveals no evidence that TSI acquired the trade secrets through espionage. Because those theories are not supported by the evidence, they should have been omitted from the ‘improper means’ definition that was submitted to the jury.“

(emphasis added, citations omitted). The Court went on to cite Texas Supreme Court authority stating that while “a jury charge submitting liability under a statute should track the statutory language as closely as possible,” the statutory language “may be slightly altered to conform the issue to the evidence presented,” and that “[a] broad-form question cannot be used to put before the jury issues that have no basis in the law or the evidence.”

UDF v. Megatel illustrates the Fifth Court’s approach to “public concern” as defined by the TCPA: “[W]hile the alleged communications may have been motivated by a climate of public scrutiny created by criticisms of the UDF Parties’ business practices, the communications at issue did not in any way address the substance of either those criticisms or the resulting public scrutiny. Instead, they addressed only the termination of contracts . . . as a means for the UDF Parties to achieve liquidity which is not a matter ‘of political, social, or other concern to the community.'” No. 05-19-00647-CV (May 29, 2020) (mem. op.) (citation omitted).

The details of Duncan v. Park Place Motorcars provide a road map to “death penalty” sanctions, both substantively and procedurally as to the trial court’s findings: “On this record, we conclude the imposition of death penalty sanctions was just because it related directly to the conduct at issue in the case—specifically, Duncan’s  failure to appear for the completion of his deposition, and generally, Duncan’s  continuing violation of the trial court’s orders and hindrance of the discovery process  for appellees; the trial court imposed lesser sanctions to no avail; and Duncan’s  conduct throughout the long history of the case reasonably justified a presumption his affirmative claims lacked merit. Accordingly, we conclude the trial court did not abuse its discretion in ordering death penalty sanctions in this case.” No. 05-19-00032-CV (June 2, 2020) (mem. op.)

The philosophy of aesthetics finds practical application in the law of website user agreements, as illustrated in Home Advisor, Inc. v. Waddell. The plaintiffs sought to avoid arbitration of their claims, arguing that the notice about “terms and conditions” on this screen was not sufficiently conspicuous:

The Fifth Court disagreed. Citing the recent Northern District of Texas opinion in Phillips v. Neutron Holdings, the Court noted a distinction among “clickwrap” agreements, “browsewrap” agreements, and “sign-in-wrap” agreements. This case involved a sign-in wrap agreement, which “notifies the user of the existence of the website’s terms and conditions and advises the user that he or she is agreeing to the terms when registering an account or signing up,” and is “typically enforce[d] . . . when notice of the existence of the terms was ‘reasonably conspicuous.'” The Court found that this agreement was conspicuous enough, noting that “more cluttered and complicated sign-in-wrap screens have been found to provide sufficient notice” of similar contract terms. No. 05-19-00669-CV  (June 4, 2020) (mem. op.)

“[W]e decline to extend the Supreme Court’s holding in Burnham to find personal jurisdiction over James in all of his capacities simply because he was served in his individual capacity while present in Texas. Such a holding would conflict with the consistent position taken by Texas courts that actions taken by an individual in a representative capacity are separate and distinct from actions taken in an individual’s personal capacity.” Hanschen v. Hanschen, No. 05-19-01134-CV (May 28, 2020) (mem. op.) A concurrence noted: “We did not conclude whether the trial court could obtain personal jurisdiction over James in his representative capacities in the future if he were to be served properly in those capacities.”

Recent orders about conducting trials during the pandemic highlight the different procedural structures of the state and federal courts.

In the state system, the Texas Supreme Court recently released its seventeenth emergency order about when and how jury trials may resume. (An order, incidentally, that I got from the txcourts.gov website, which shows progress in returning that site to normal after the recent hacker attack.)

In the federal system, the recent order in In re Tanner reminds of the considerable district court discretion about such matters: “[T]he district court has given great consideration to the COVID-19 issues addressed by Tanner. . . . [W]hatever each of us as judges might have done in the same circumstance is not the question. Instead, as cited below, the standards are much higher for evaluating the district court’s decision” for purposes of a writ of mandamus or prohibition. No. 20-10510 (May 29, 2020).

Here is the PowerPoint for my June 2 presentation to the DBA’s Appellate Law Section about Fifth Court commercial-litigation opinions over the last twelve months.

In a securities fraud case, a trial court issued a protective order against certain questioning of a nonparty deponent. After thoroughly reviewing Texas discovery law about relevance, a Fifth Court panel majority reversed:

“[W]e conclude the two challenged lines of questioning were not necessarily outside the scope of relevant information. Information concerning other lawsuits is not per se outside the scope of discovery, and relators did not establish below that the circumstances of the non-party’s role in the Servergy and investment adviser situations are so dissimilar to the allegations here as to be irrelevant. Anything reasonably calculated to lead to the discovery of material evidence is generally within the scope of proper discovery.”

In re Cook, No. 05-19-01283-CV (May 20, 2020) (mem. op.) (citations omitted). A dissent saw the matter differently:

“Here, relators have not clearly established that other discovery is unavailable to support their claims and defenses. In fact, the record is clear that the questions prohibited by the protective order were only ‘a few minutes of additional questions’ in a six-hour deposition, and relators were able to explore extensively the nonparty’s relationships with the parties and his familiarity with and participation in the events underlying the case.”

A helpful summary of the requirements for proving up a mandamus record appears in In re Gentry:  “Documents become sworn copies when they are attached to an affidavit or to an unsworn declaration conforming to section 132.001 of the Texas Government Code. The affidavit or unsworn declaration must affirmatively show it is based on relator’s personal knowledge. The affidavit or unsworn declaration is insufficient unless the statements in it are direct and unequivocal and perjury can be assigned to them. An affidavit or unsworn declaration would comply with the rule if it stated, under penalty of perjury, that the affiant has personal knowledge that the copies of the documents in the appendix are true and correct copies of the originals.” No. 05-19-01283-CV (May 18, 2020) (mem. op.)

Pennington, Fields, and Phillips each owned 1/3 of the shares of Advantage Marketing & Labeling, Inc. Pennington argued that under their shareholder agreement he other two were required to buy his stock when he decided to sell his full interest and become a “retiring shareholder” under that agreement. Fields and Phillips resisted, pointing out that Pennington was employed by another business when he made his demand; thus, “because he was not ‘retired’ from any and all employment, he could not be a ‘retiring shareholder’ for purposes of the CPA.” The Fifth Court disagreed based on two basic contract-construction principles: “This construction . . . assigns a definition to only one of the two words the parties used to describe who must comply with the paragraph’s provisions. It also disregards the context. The paragraph imposes requirements for the disposition of shares by a ‘retiring shareholder’ in the context of an agreement that imposes restrictions on stock transfer.” Pennington v. Fields, No. 05-19-00149-CV (May 22, 2020) (mem. op.)

I spoke today, virtually, to the Texas Bar CLE’s 33rd “Advanced Evidence and Discovery Course,” which would have been in San Antonio. My topic was proving up damages in a commercial case, and I focused on ten specific issues identified in recent Texas and Fifth Circuit cases. I also showed off some smooth hand gestures, as you can see above. Here is a copy of my PowerPoint. The Bar staff did a terrific job with the A/V logistics and I look forward to doing another program with them soon.

The tenants in a residential lease sued for injuries from toxic mold on the property. The Fifth Court expressed sympathy, but nevertheless affirmed summary judgment for the landlord based on an “as is” clause in the lease, citing Prudential Ins. Co. v. Jefferson Assocs. 896 S.W.2d 156 (Tex. 1995). In addition to noting that the clause was prominently written in all-caps, and consistent with other related provisions in the lease, the Court observed: ‘Before they entered into the Lease and related agreements, Rebecca walked through the house twice and Richard walked through the house once. After signing the Lease but prior to moving in, the Potters visited the house again and saw “black substance” on the wall and coming out of a wall socket. Rebecca testified she saw “bubbling” and “deforming” of a wall that, according to a workman, was caused by “clogged gutters.” In a subsequent visit prior to moving in, Richard saw “black underneath the carpet” being removed by a carpet repairman. When they were told by workmen the black substance was dirt and dog feces, the Potters did not further investigate.’ Potter v. HP Texas 1 LLC, No. No. 05-18-01513-CV (Apr. 6, 2019) (mem. op.)

ACI, the general contractor on a hotel-construction project, was sued by Ram, the subcontractor who installed the window. Ram won a summary judgment for a violation of Texas’s Prompt Payment Act. ACI asserted a defense under the Construction Trust Fund Act involving “actual expenses directly related to the construction or repair of the improvement … .” The Fifth Court found the relevant statutory language clear and unambiguous, requiring no further use of statutory-interpretation techniques: “[The Trust Fund Act provision] acts as a defense to claims of misapplication of funds the contractor holds in trust for beneficiaries. It does not apply to a claim the contractor failed to promptly pay subcontractors.” Alberelli Constr. v. Ram Indus. Acquisitions LLC, No. 05-18-01529-CV (May 15, 2020).

Appellant challenged a temporary injunction arising from a noncompetition agreement about supplying beauty products to salons. The Fifth Court affirmed in Kim v. Oh, holding, inter alia:

• Capacity. “Appellants argue the evidence in the record establishes they signed the contracts with Oh in their corporate, not individual, capacities, and consequently there are no enforceable contracts on which Oh can recover against appellants. Appellants further assert that Oh lacks capacity to recover in this suit, noting he signed the contracts as ‘Grace Beauty Supply’ and that Grace Beauty Supply is not a party to this suit. However, these arguments raise affirmative defenses and dilatory pleas, which may be addressed at a later proceedings on the merits and are not issues to be resolved at this stage . . . ” (footnote omitted).
• Irreparable Injury. This testimony worked: “Oh stated there had been many violations of the noncompetition provisions, but he could not estimate how many because there were ‘too many’ to count. He saw appellants at his customers’ salons ‘many times’ after they terminated their contracts with him in December 2018. He believed appellants were competing with him for the same business and would continue to violate the noncompetition provisions. Oh testified it had been ‘very, very difficult’ for him to rebuild his customer base and that he was expecting a ‘difficult time’ when asked if he would be able to survive financially in the months between the hearing and the trial.” No. 05-19-00947-CV (May 11, 2020) (mem. op.)

Discovery problems led to a contempt finding and an order imposing jail time in In re Duncan, No. 05-19-01572-CV (May 14, 2020) (mem. op.) The Fifth Court granted habeas relief, noting this basic due-process requirement in this area:

“Contempt may be. . .divided into civil or coercive contempt, which involves confinement pending obedience to the trial court’s order, and criminal or punitive contempt, which results in a punishment for past transgressions. In cases where the trial court seeks to impose criminal or punitive constructive contempt, due process requires a contemnor to either be present or affirmatively waive his or her presence for the contempt hearing.. When the contemnor fails to appear for the contempt hearing, the trial court must issue a capias or writ of attachment to secure the contemnor’s presence.”

(emphasis added, citations omitted, applying, inter alia, In re Reece, 341 S.W.3d 360 (Tex. 2011), and Ex parte Alloju, 907 S.W.2d 486 (Tex. 1995)).

The Fifth Court’s newly-released opinions are back online, with opinions accessible on a website and a new Twitter account. A press release from the Court has additional information about access while the main txcourts.gov site continues to be down. Bloggers and court observers rejoice!

With the kids home from school because of the coronavirus, I’ve watched a lot of YouTube videos over their shoulders.  In particular, this one tells the fascinating story about how post-production editing saved Star Wars, which was bloated and impossible to follow in its first rough versions. Among other changes, the start of the film was drastically simplified – from a series of back-and-forths between space and Tatooine, to a focus on the opening space battle and no shots of Tatooine until the droids landed there. This bit of editing is directly relevant to the tendency of legal writers to “define” (introduce) all characters and terms at the beginning of their work, without regard to the flow of the narrative that follows.

It is hard to blog about the Texas state appellate courts when their website has been the victim of a ransomware attack! The unfortunate incident has been well-covered by the Texas Lawbook and Law360. Posts on this blog will be less frequent until the situation is resolved.

A trademark-user who establishes prior use of the mark can still lose his rights to it if he abandoned them. “A party trying to show abandonment must prove that the owner of the mark both discontinued use of it and that he did not intend to resume its use in the reasonably foreseeable future. Nonuse of a mark for a period of three consecutive years creates a rebuttable presumption that a mark has been abandoned without intent to resume its use.” (citation omitted).

In King Aerospace, Inc. v. King Aviation Dallas, the appellee contended that the relevant mark was abandoned after the appellant had a serious accident. “KAC contends it made a prima facie case of abandonment because Randall admitted he did not make any aircraft sales from 1993 until at least 2000. Although Randall testified he did not personally sell any aircraft while he was recovering from his near-fatal accident, he also testified his father, Sam, was conducting the business of the company during that time. Jordan testified that, while Randall was recovering, he helped Sam file monthly reports identifying what airplanes they owned, when they bought them, and when they sold them.” This evidence established use and defeated the intent requirement: “The fact that Sam continued the business of the company, and Randall resumed selling planes using the names King Aviation and King Aviation Dallas as soon as he was able to do so, is evidence of his intent to resume use of the marks.”  No. 05-19-00245-CV (April 30, 2020) (mem. op.).

To the right, Pikachu is waving, but the appellee in King Aerospace, Inc. v. King Aviation Dallas was not waiving, as the Fifth Court observed:

In its reply brief, KAC contends Randall’s responsive brief on appeal, filed pro se, “provides nothing for this Court to review” because it fails to cite to the appellate record or legal authority. In his response, Randall informed the Court he was unable to find appellate counsel and he submitted his trial counsel’s post-trial brief as his response to KAC’s appellate arguments. KAC, as the appellant, has the burden to show grounds for reversal on appeal.  Randall, as appellee, was not required to file a brief for us to review what was presented to the trial court; thus, he cannot be said to have committed “waiver” due to inadequate briefing. 

No. 05-19-00245-CV (April 30, 2020) (mem. op.) (citation omitted, emphasis added).

On pages 62-63 of the May 2020 issue of “D CEO” magazine, you can read a profile of me as the only Tarot-reading lawyer in Dallas–a skill first acquired on trips to New Orleans for appellate business!

The Fifth Court’s recent opinion in Guillory v. Dietrich addressed the appropriate subjects for findings of fact. The Court continued discussion of that subject in King Aerospace, Inc. v. King Aviation Dallas, a rare state-court trademark-infringement case. (The substantive holdings of King will be discussed in later posts.) The  Court rejected the appellants’ arguments that these additional findings of fact should have been made:

• A finding about the “tacking” doctrine about a trademark’s use, when that doctrine was not necessary to support the trial court’s judgment, as well as a similar unnecessary finding about the effect of the Appellee’s bankruptcy;
• “Although the trial court made no specific finding regarding the date [Appellee] began using the . . . mark, it concluded Appellee had prior common law rights in that mark” (emphasis added);
• Appellant objected that the findings “fail to specify how [Appellee] used the marks in commerce and the effect of [his] inability to work after his accident,” as to which the Court found: “The trial court found that [Appellee] continuously used the . . . marks and neither abandoned them nor intended to abandon them. These findings sufficiently address the controlling issues and are all that is required.”

No. 05-19-00245-CV (April 30, 2020) (mem. op.).

In a detailed review of whether certain pretrial activity waived a special appearance, the Fifth Court reminded: “Examples of actions a party can take without waiving a special appearance are (1) filing a motion for continuance relating to discovery on a motion to quash service; (2) serving nonjurisdictional discovery requests; (3) filing a motion to compel nonjurisdictional discovery but not scheduling a hearing or obtaining a ruling on the motion; (4) litigating a jurisdictional discovery dispute; (5) litigating other disputes that are factually related to the special appearance; or (6) litigating opposition to merits-based discovery sought by another party.”  

Applying these principles, the Court concluded that no waiver occurred by (1) “filing an obtaining a ruling on a Motion to Vacate Judgment and Protective Order,” (2) participating in discovery, including responding to a request for disclosures, and (3) filing a sanctions motion based on Tex. R. Civ. P. 13, which in part touched on the allegations relevant to the jurisdiction dispute. Brady v. Kane, No. 05-18-01105-CV (April 28, 2020) (mem. op.).

“First Ovilla sought to build a house on property that is encumbered by restrictive covenants, and the property owners’ association had previously sought to prevent another builder from constructing a house with a similar building plan. The amended permanent injunction signed in that case (and on which appellees largely relied in their plea to the jurisdiction) has been dissolved by this Court. Therefore, given the record before us, the declarations sought by First Ovilla present a justiciable controversy and are not moot.” First Ovila v. Primm, No. 05-19-00042-CV (April 27, 2020) (mem. op.) (emphasis added).

The jury charge in an attorney-client fee dispute asked: “Did any of the following persons form an agreement with Glast, Phillips & Murray, PC to pay for fees concerning legal representation?” The question then required the jury to answer “yes” or “no” for both of the defendants on that claim. They lost, and argued on appeal that “question one asked the jury if a contract had been formed between the parties—an issue the [defendants] argue was not in dispute—but neglected to ask whether the agreement was for payment of a flat fee or GPM’s hourly rates” (citing  Lone Starr Multi-Theatres v. Max Interests, 365 S.W.3d 688 (Tex. App.–Houston [1st Dist.] 2011, no pet.)

The Fifth Court found no abuse of discretion in the submission. It distinguished Lone Starr, a landlord-tenant dispute, as involving a disconnect between the jury’s damages finding and the judgment, in that “none of the questions submitted to the jury asked the amount of lost rentals suffered by the landlord, and the [jury’s] ‘fair market value’ determination did not include or even support a lost rentals determination.” Here, in contrast: “. . . in answering question four, the jury calculated GPM’s damages as the amount of GPM’s outstanding invoices, an amount derived from GPM’s hourly rates and billable hours rather than any flat fee. Accordingly, the jury necessarily rejected the Namdars’ capped fee term, and the answer to question four informs us that the jury determined the parties agreed that the Namdars would pay GPM’s hourly rates for the hours billed.” Narmarkhan v. Glast Phillips & Murray, No. 18-0802-CV (April 24, 2020) (mem. op.).

As reported by The Verge on April 24, Microsoft Word now auto-corrects the use of two spaces after a period at the end of a sentence. The battle, such as it was, should now be considered over. This influential article in Slate explains why the one-spacers – while correct during the era of typewriters, which made every letter and space the same size – have been wrong since the early 1990s and the widespread availability of proportional spacing in modern word processing software.

Evans v. Martinez arose from a jury trial as to whether reasonable diligence had been used in serving a defendant, against whom suit had been filed on the last day of the limitations period. The jury answered “no” and the Fifth Court affirmed the resulting judgment: “Here, the return of service recites that the process server first came into possession of the citation on October 27, 2015, more than a month after limitations expired. Although Weinkauf offered some evidence regarding the delay, he did not explain why, when he knew he had filed suit on the last day of limitations and that he would shortly leave on vacation, he did not make an alternative arrangement to ensure that the effort to serve Martinez would begin in his absence. On his return, he left the citation sitting at his reception desk and checked on it only once a week even after problems arose with his arrangements for service. There is no evidence to support his testimony of the efforts he made, such as phone records, notes, emails, or testimony from support staff or process servers.” No. 05-18-01241-CV (April 20, 2020) (mem. op.)

Amend v. J.C. Penney Corp. declined to apply the TCPA to a noncompete case. As to the right of association the Court observed: ‘Amend testified he is “responsible for Lowe’s’ website and app sales,” “responsible for online merchandising,” and responsible for “driving sales.” In his position, he works with others on “product management,” “analytics,” “digital technology,” and “strategy and business development,” and he makes recommendations to other Lowe’s employees about these subjects. The evidence does not show that these responsibilities necessarily involve public communications. Instead the responsibilities appear to involve communications between Amend and other Lowe’s employees.’ No. 05-19-00723 (March 31, 2020) (mem. op.) (emphasis added) (LPHS represented the successful appellee in this case.)

“'[A] plaintiff’s failure to have a valid [assumed name] certificate on file is not a jurisdictional issue but, rather, a capacity issue that is properly raised in a plea in abatement so that the cause may be suspended while the defect is corrected.’ By failing to file a verified plea in abatement prior to trial, appellees waived their complaint.” Pennington v. Cypress Aviation, No. 05-19-00345-CV (April 9, 2020) (mem. op.); cf. Malouf v. Sterquell PSF Settlement LC, No. 05-17-01343-CV (Nov. 7, 2019, pet. filed) (mem. op.) (finding no waiver when the plaintiffs’ “claimed status as a . . . partner was a primary focus of both sides’ arguments at trial”).

Barnes sued Kinser; in response, Kinser moved for sanctions. Barnes then moved to dismiss the sanctions request under the TCPA. The Fifth Court, citing a series of opinions involving analogous filings, held: “The request for sanctions here, like the similar request in Misko, is not a request for legal or equitable relief and not a legal action as defined by the TCPA.” Barnes v. Kinser, No. 05-19-00481-CV (April 7, 2020).

Alcala sought to avoid arbitration of a premises-liability claim against her employer, arguing, inter alia, that she did not understand English. Her argument did not prevail because of direct-benefits estoppel:

‘The record reflects Alcala received $5,116.46 under the Plan in the form of benefits paid to cover medical expenses related to the subject of her suit against appellants: her February 2016 on-the-job injury. The Plan itself provided, “there is an Arbitration Policy attached to the back of this booklet.” The Agreement provided, “Payments made under [the] Plan . . . constitute consideration for this Agreement.” Having obtained the benefits under the Plan, which incorporates the Agreement by reference, Alcala cannot legally or equitably object to the arbitration provision in the Agreement.’

Multipacking Solutions v. Alcala, No. 05-19-00303-CV (April 14, 2020).

Resolving an unclear area about Sabine Pilot claims for wrongful discharge, the Fifth Court held in “Sandberg did not plead or present evidence that ST[Microelectonics] ever required him to sign false tax statements or other financial documents. Instead, the gist of his claim is that he was terminated for stating he would not execute the documents ‘if there was a breach of the [Advanced Pricing Agreement] agreement and improper adjusting entries were included in the accounting figures’. Sandberg’s pleading does not allege facts showing ST forced Sandberg “to choose between illegal activity and [his] livelihood[].” Sandberg v. STMicroelectronics, Inc., No. 05-18-01360-CV (April 9, 2020).

It’s showtime! The Fifth Court’s first livestreamed argument will be Tuesday, April 14 at 10 AM in Hanschen v. Hanschen, a personal jurisdiction case.

Associate judges play a valuable role in helping cases move along. The relevant statute sets limits, however, as illustrated by Kam v. Kam, No. No. 05-19-01293-CV (April 10, 2020) (mem. op.): “The final judgment here was signed by the associate judge but not the judge of the referring court. While the associate judge may have decided all issues and the parties may have agreed to appeal directly to this Court, the judgment is not appealable until the judge of the referring court has signed it. SeeTex. Gov’t Code §§ 54A.214(b), 54A.217(b). . . . Accordingly, we lack jurisdiction and dismiss the appeal and any pending motions.”  

This is a cross-post from 600 Hemphill which follows the Texas Supreme Court.

B.C. v. Steak & Shake, the supreme court reversed a Dallas case case that declined to consider a late-filed summary judgment submission, holding: “We . . . conclude that the trial court’s recital that it considered the ‘evidence and arguments of counsel,’ without any limitation, is an ‘affirmative indication’ that the trial court considered B.C.’s response and the evidence attached to it. The court of appeals concluded this reference ‘indicates nothing more than the trial court considered [Steak N Shake’s evidence] in conjunction with the traditional motion.’ But a court’s recital that it generally considered ‘evidence’—especially when one party objected to the timeliness of all of the opposing party’s evidence—overcomes the presumption that the court did not consider it.” No. 17-1008 (March 27, 2020) (per curiam)

After a jury trial, Mumford was declared to be a sexually violent predator and then civilly committed. Dr. Turner, a psychologist, interviewed him and prepared a written report. The trial court struck, for procedural reasons, another expert who the State planned to call at trial, and then allowed the State to offer Dr. Turner’s written report in evidence. The Fifth Court reversed, finding that the report was prepared in anticipation of litigation (the commitment proceedings) and thus was not admissible as a business record. As to harm, it said: “Dr. Turner’s report was the only evidence that appellant ‘suffers from a behavioral abnormality that makes the person likely to engage in a predatory act of sexual violence.’ Without evidence to support that finding, the jury could not have found
appellant was a sexually violent predator.” In re Mumford, No. 05-19-00186-CV (March 31, 2020) (mem. op.)

The Fifth Court’s website reports: “The Fifth District Court of Appeals at Dallas has set up a YouTube channel for live streaming oral arguments held via Zoom Web Conferencing. The channel is online and open for subscriptions.”

The channel is available here and is a wonderful addition to public awareness and knowledge about this Court.

Ali v. DSA Partners provides a useful reminder about a common situation in multi-party litigation: “[A]s a general rule, severance after an interlocutory summary-judgment order to expedite appellate review is proper and not an abuse of discretion.”  No. 05-18-01240-CV (March 24, 2020) (mem. op.).

The appellants in Trubenbach v. Energy Exploration “urge[d] that ‘context matters.’ They argue that as non-signatories, they can compel Energy Exploration to arbitration but Energy Exploration cannot compel them to arbitration. But this is not a case in which non-signatories first moved to compel arbitration, then later changed their minds, withdrew their consent, and proceeded with the litigation in a judicial forum. Here, appellants urged diametrically opposing positions in two different courts at the same time.” (emphasis in original).

As a result, “[t]heir conduct in claiming rights under the arbitration agreement and their conduct throughout the course of this proceeding clearly reflected their willingness to forego their right to a judicial forum.” No. 05-18-01090-CV (March 27, 2020) (mem. op.). The Court also observed: “Appellants’ actions are akin to behavior prohibited by the invited error doctrine—a party may not complain of an error which the party invited.” (citations omitted).

The business fallout from the failed bus-camera program at the now-defunct Dallas County Schools (“DCS”) led to litigation about the related intellectual property, which led to a TCPA motion filed by a bidder on the technology during the winding up of DCS. The Fifth Court found that the (pre-September-2019) TCPA did not apply, emphasizing its free-speech prong but also finding no protected right of association or petition:

Although the BusStop Technology provides safety measures for children who ride school buses, the benefits of the technology were not the basis of the communications. ATS’s communications with DCS and the Dissolution Committee, including requesting and receiving information about the technology, obtaining prototypes of the technology, and ATS’s actual bid, were private communications about a private, commercial transaction. Similarly, although DCS and the Dissolution Committee are governmental entities, the transactions and associated communications were private financial transactions that did not impact the public; the transactions did not require public approval, and ATS did not argue that the governmental status of DCS and the Dissolution Committee brought the communications into the realm of public concern.

BusPatrol America LLC v. American Traffic Solutions, Inc., No. 05-18-00920-CV (March 24, 2020) (mem. op.) (emphasis added).

The key issue in Hernandez v. Sun Crane & Hoist, Inc. was whether a general contractor exercised “actual control” over a subcontractor’s work. The en banc court reversed a no-evidence summary judgment for the contractor, observing in footnote 9:

“. . . The original panel’s analysis omits any mention of (1) the Subcontract provisions described above regarding schedule control and mandatory safety harness use; (2) Johnston’s testimony that JLB supervisory employees were on-site on the day of the accident and knew the cage could fall over in the event of strong wind or improper bracing; (3) Hernandez’s testimony that he saw JLB supervisors looking at the cage’s bracing prior to the accident; and (4) Molina’s statements that the wind speed was 15–25 miles per hour on the day of the accident and Hernandez was told to jump, but was tethered to the cage by his safety harness.

Those omissions demonstrate that the original panel’s opinion represents a serious departure from precedent in the review of no-evidence summary judgment cases and therefore warrants en banc review under Texas Rule of Appellate Procedure 41.2 to ‘secure or maintain uniformity of the court’s decisions.'”

The court split cleanly along party lines, with all Democratic justices joining the majority opinion, and all Republican justices joining two dissents. Justice Bridges disagreed with the majority’s legal analysis while Justice Whitehill questioned whether the case had warranted en banc consideration.  No. 05-17-00719-CV (March 26, 2020).

The estate of Billy Dickson alleged that he died from asbestos exposure at a Bell Helicopter plant. The estate won at trial on a theory of gross negligence. The panel reversed on legal sufficiency grounds, finding no evidence that Bell subjectively knew of a risk to Dickson based on his use of boards containing asbestos as part of the testing of helicopter components. Bell Helicopter Textron v. Dickson, No. 05-17-00979-CV (Aug. 23, 2019) (mem. op.) Justice Bridges wrote the opinion, joined by Justice Whitehill and then-Justice Brown.

The full court denied en banc review on March 25. Justice Bridges signed the order, apparently joined by Justices Myers, Whitehill, Schenck, Pedersen, and Evans. Justices Molberg and Nowell did not participate.

A dissent criticized the panel’s application of the City of Keller standard as not properly considering all the evidence heard by the jury, and noted : “This court has misapplied the legal sufficiency standard of review to second-guess jury verdicts before and here, it does so again.” Justice Carlyle wrote the opinion, joined by Chief Justice Burns and Justices Osborne, Partida-Kipness, and Reichek.

A concurrence, written by Justice Whitehill and joined by all other Republican Justices on the Court (Justices Bridges, Myers, Schenck, and Evans), responded to the dissent, noting inter alia: “With no apparent bearing on the correct legal analysis of the issues in this case, the dissenting opinion (i) criticizes four prior opinions from this Court that are not asbestos cases and have no apparent logical relationship to this case . . . ”

To summarize, the vote was 6-5 against en banc review, largely on party lines, and would have come out differently had the two nonparticipating Justices joined their Democratic colleagues.

The coronavirus situation has prompted review of once-obscure statutes and rules; among them, Tex. R. App. 17, which addresses where to go if the ordinarily-assigned court of appeals is unavailable. Surprisingly, Rule 17.2 sends the relevant party to the nearest alternative court of appeals, measured by distance from the trial court.  For courts in the Dallas district, then, that could be Fort Worth, Waco, Tyler, or Texarkana. (To be clear, THE DALLAS COURT IS AVAILABLE, this post is just a note on a TRAP that has become less obscure in light of current events.)

While mandamus litigation often focuses on whether a clear abuse of discretion occurred, the other relevant factors can also be dispositive. Consider the panel majority in In re Alpha-Barnes Real Estate Services LLC, which observed: “While the trial court’s order presents an error potentially justifying reversal on a direct appeal, has failed to demonstrate the inadequacy of an appeal, particularly given the limited scope of the order and alternative mechanisms by which relator may introduce the same evidence excluded by the order.” It also relied upon laches, noting a lengthy and unexplained delay in seeking mandamus relief. A dissent would have granted the petition, noting the likely effect on the trial, and that the parties had entered a stipulation about the otherwise-unexplained delay.  No. 05-20-00073-CV (March 17, 2020) (mem. op.).

One Dallas Court of Appeals case addresses the breach-of-contract defense of impracticability, Hewitt v Biscaro, 353 S.W.3d 304 (Tex. App.—Dallas 2011, no pet.). Relevant to the current crisis, it involves a government order that allegedly made performance more difficult. The Court examined whether:

• the performance issue was a basic assumption of the contract;
• the government’s action was an official order or regulation (in that case, the SEC’s contact with the defendant was not); and
• the defendant was acting in good faith.

The Court relied on an earlier Texas Supreme Court case and the relevant Restatement (Second) of Contracts provision. Application of this opinion will be important in upcoming commercial disputes created by the novel coronavirus.

This is a cross-post from 600Hemphill, which follows the Texas Supreme Court:

Henry McCall lived in a cabin on Homer Hillis’s property, occasionally helping Hillis with maintenance at the McCall’s bed-and-breakfast. While working on Hillis’s sink, a brown recluse spider bit McCall. The Texas Supreme Court found that the ferae naturae doctrine barred McCall’s lawsuit against Hillis: “[H]e owed no duty to the invitee because he was unaware of the presence of brown recluse spiders on his property and he neither attracted the offending spider to his property nor reduced it to his possession. Further, [McCall] had actual knowledge of the presence of spiders on the property.” Hillis v. McCall, No. 18-1065 (Tex. March 13, 2020). In addition to its impact on brown-recluse litigation, the reasoning of this opinion about liability for small, dangerous creatures well be relevant in any future litigation about coronavirus exposure.

In re Johnson catches the eye as an atypical non-memorandum opinion in a pro se mandamus proceeding arising from a criminal case. The novel feature of the opinion is its footnote (longer than the actual opinion), using the Court’s “discretion to take judicial notice of adjudicative facts that are matters of public record” to review the relevant online docket sheet to establish mootness. No. 05-20-00068-CV (March 11, 2020)

The trial court dismissed Heri Automotive’s counterclaims for forum non conveniens. Heri appealed. The Fifth Court dismissed because “no authority exists authorizing the appeal of the challenged interlocutory order,” and also noted that “appellant cites no authpority, and we have found none, that authorizes mandamus review of an interlocutory order granting a motion to dismiss for forum non conveniens.” Heri Automotive v. Adams, No. 05-19-01215-CV (Feb. 21, 2020) (mem. op.).

A 2018 article with an LPCH colleague considered when it is wise for an intermediate appellate court, subject to further review by the Texas Supreme Court, to take issues en banc. That article has been updated on this page on this website to reflect the supreme court’s recent Flakes opinion; only time will tell whether the recent rulings and dissents by the en banc Dallas court will draw supreme court interest.

After the 2018 election, an LPCH colleague and I wrote about the potential for renewed interest in “factual sufficiency” review–closely related to “legal sufficiency” review, but placed in the exclusive jurisdiction of the intermediate courts of appeal under the state constitution.

An example appeared in In re C.V.L., where a panel majority reversed the termination of a parent-child relationship in a factual sufficiency review: “[E]vidence that Father used methamphetamines twice during the underlying proceedings and Bonds’ unsubstantiated belief that Father will use drugs again in the future because he used drugs twice in the past is not enough under a factual sufficiency review to permanently deprive Father and child of a relationship when weighed against all of the contrary, uncontroverted evidence presented at trial and the strong presumption that a child’s best interests are served by maintaining the parent–child relationship.” 

A dissent saw the court of appeals’ role differently: “This case presents important questions regarding an appellate court’s ability to second guess a factfinder’s pivotal credibility determinations in a termination case given the supreme court’s admonition that despite the heightened standard of review in termination cases, courts of appeals must nevertheless still provide due deference to the factfinder’s credibility determinations.” No. 05-19-00506-CV  (Dec. 13, 2019, pet. filed) (mem. op.)

Factual sufficiency review in this type of family-law case involves unique issues that may not arise in commercial disputes, but the case is still an important example of how this standard works in practice.

In a dispute about arbitrability, the plaintiff claimed never to have seen the arbitration agreement, and after receiving evidence about the defendant’s computer system, the trial judge agreed.

A panel majority affirmed the denial of the motion to compel arbitration: “Aerotek made the choice to forego in-person wet-ink signatures on paper contracts. This may be a good business decision that allows it to more efficiently process more business than otherwise possible. And in this case, Aerotek made the choice to bring only one person, an employee without apparent IT experience specific to the type of computer system whose technical reliability and security she sought to vouch for. Aerotek did this in the face of admitting it had contracted out creation and implementation of this system to another entity altogether and brought no witness from that entity. We conclude Aerotek did not present evidence establishing the opposite of a vital fact, here that appellees’ denials of ever seeing the arbitration contracts were physically impossible given Aerotek’s computer system.” 

A dissent had a different view of the evidence and warned that as a policy matter: “This would allow any party to a contract signed electronically to deny the existence of the contract even in the face of overwhelming evidence that the contract was signed. Further, this holding amounts to a state rule discriminating on its face against arbitration, which is expressly prohibited.”

The en banc court denied review in a brief order (Justices Molberg (the trial judge) and Whitehill did not participate); a dissent by Justice Schenck reiterated the dissent’s warnings and “urge[d] prompt review by the Texas Supreme Court.” (joined by Justices Bridges (the panel dissenter), Evans, and Myers).

In the 2018 election for a Dallas County Justice of the Peace position, Democratic candidate Margaret O’Brien obtained a default judgment that her Republican opponent, Ashley Hutcheson, was ineligible for the position because of her residence. IAfter the election, in December 2018, a Fifth Court panel reversed, finding that the order was void because an Election Code provision bars default judgments in election cases, and further finding that the matter was not moot and required a further trial-court order because the judgment included an award of attorneys’ fees.

Litigation continued before the en banc court (the makeup of which significantly changed in the same 2018 election), which ultimately settled. In a short opinion by Chief Justice Burns on March 6, 2020, a majority of the Court dismissed the case as moot and withdrew the panel opinion.

Controversy ensued, as reflected by the four other opinions issued that day:

• A dissent by Justice Schenck found that the matter was not moot (as it was capable
  of repetition, etc.), agreed with the reasoning of the panel, and criticized the decision to withdraw the panel’s opinion (joined by Justices Bridges and Evans);
• Another dissent, by Justice Whitehill, criticized the decision to withdraw the panel’s opinon for other reasons (also joined by Justice Bridges);
• A concurrence and dissent by Justice Bridges (the author of the panel opinion) agreed with the conclusion that the case is moot, disagreed with the withdrawal of the panel opinion, and reiterated the reasoning of that opinion (joined by Justices Myers, Whitehill, Schenck, and Evans — the full complement of Republican Justices on the present court);
• A concurrence by Justice Molberg clashed with the substantive reasoning of the dissents, but concluded that the order was void for another reason – ripeness – as the election had not yet occurred at the time of judgment. This opinion was joined by all other Democratic Justices on the court except Justice Pedersen, who did not participate in the case.

Liederman, a New York lawyer, sent seventy-seven emails to Texas, made five phone calls there, and signed and delivered three tolling agreements to Davis, a Texas-based attorney, “over a span of three years in working towards settling appellees’ claims.”  The Fifth Court found no specific personal jurisdiction, observing: “Liederman could have ‘quite literally’ interacted with Davis, who could have been anywhere in the world, in the same manner. . . . It is apparent that Invasix’s contacts with Davis were based on her representation of the nonresident plaintiffs in the personal injury lawsuit and had nothing to do with the State of Texas.” Invasix, Inc. v. James, No. 05-19-00494-CV (Feb. 25, 2020) (mem. op.) (emphasis added). The Court also found no general personal jurisdiction, applying recent Texas and United States Supreme Court opinions that have limited the scope of that doctrine.

In Grisaffi v. Rocky Mountain High Brands, the Fifth Court reversed and remanded a default judgment after identifying an impermissible double recovery on the key issue: “Although Grisaffi committed numerous wrongful acts against Rocky Mountain, the default judgment awards Rocky Mountain $3.5 million as compensation for ‘funds obtained through fraud, breach of fiduciary duty and conversion with respect to Series A Preferred Stock . . . .’ The default judgment further awards Rocky Mountain declaratory relief to void the issuance of that Series A Preferred Stock. Thus, both the monetary and declaratory relief awarded to Rocky Mountain compensate it for the single injury of the wrongful issuance of Series A Preferred Stock caused by Grisaffi.” No. 05-18-01020-CV (Feb. 27, 2020) (mem. op.)

Section 171.025 of the Civil Practice & Remedies Code says: “The court shall stay a proceeding that involves an issue subject to arbitration if an order for arbitration or an application for that order is made under this subchapter.” The dispute in In re: Baby Dolls Topless Saloon involved a mandamus petition from a defendant’s perceived inability to obtain an order implementing this stay, during its interlocutory appeal from denial of its motion to compel arbitration.

The panel majority denied the petition, finding  that the issue of arbitrability “has been briefed in the interlocutory appeal and will be decided by the panel of justices assigned to decide that appeal, which is just as the legislature intended when it enacted section 51.016 and provided for an interlocutory appeal of an order denying a motion to compel arbitration. Because we follow the rule of law, we, as one panel of this Court, will not depart from this Court’s prior holding that mandamus will not issue when the legislature has expressly provided an adequate remedy by appeal.”

A dissent would have granted a stay as part of resolution of the mandamus petition, noting: “While our own statute and rules appear to compel the same result by dictating a stay of the overlapping proceedings of whatever court is first asked, we have not  done so here. Accordingly, relator has properly brought the issue before us for mandamus relief that should be available under long recognized mandamus standards and without the need of further machination or a fifth request for stay.” No. 05-20-00015-CV (Feb. 24, 2020) (mem. op.)

In re Catapult Realty arose from a foreclosure that wound a complex path through the Dallas courthouse, and offers two practice reminders about such situations:

1. The judge of one district court signed a TRO on behalf of another district judge. The resulting order was void because “[t]he record does not reflect that another temporary injunction or other evidentiary hearing was held before the 298th district judge prior to her signing the 2nd TRO.”;
2. A county court granted a plea in abatement based on her perceived inability to decide subject-matter jurisdiction. Mandamus relief was proper when this decision was incorrect legally, and where the resulting order “does not specify the circumstances that will allow for the case to be reinstated,” thus denying the plaintiff “the right to proceed to a resolution of the forcible-detainer action within a reasonable time.”

Nos. 05-19-01056-CV & -00109-CV (Feb. 20, 2020) (mem. op.)

“Birds of a feather flock together,” says the old proverb. But on the Fifth Court, justices of the same political party do not always rule together, as shown by two recent opinions.

The first, Inland Western v. Nguyen, No. 05-17-00151-CV (Feb. 10, 2020) began when the owners of a nail salon, the Nguyens, sued their landlord for alleged misrepresentations about lease renewal. They won a judgment in their favor after a jury trial, after which a Fifth Court panel reversed and rendered judgment for the landlord.

The Nguyens petitioned for rehearing en banc. The court granted their petition, held oral argument and then reversed course Feb. 10 in a 10-4 decision. It issued a short, form order denying en banc reconsideration without discussing the merits.

The order was supported by all five of the current Republican justices (David Bridges, Lana Myers, Bill Whitehill, David Schenck and David Evans), joined by retired Justice Robert Fillmore from the original panel. Four of the Democratic justices (Leslie Osborne, Bill Pedersen, Amanda Reichek and Cory Carlyle) also joined the order.

Three of those Republican justices joined Inland Western v. Nguyen inland concurrence that emphasized the judicial oversight of jury trials: “[Our system, like the federal, recognizes … that there is no right to a judgment on a jury verdict if the legal theory is invalid or the objective quality of the evidence does not support the jury’s finding.” Justice Schenck wrote the concurring opinion, joined by justices Bridges and Evans.

A four-justice dissent was joined by four other Democratic justices. Chief Justice Robert Burns wrote that he would remand for a new trial, noting, “Appellate courts are duty bound to indulge every reasonable inference to sustain a jury verdict when the evidence supports the verdict.” He was joined by justices Ken Molberg, Robbie Partida-Kipness and Erin Nowell.

The Nguyen opinions show the importance of party affiliation, in that all Republicans on the court joined the decision to deny review, while all the dissenting justices were Democrats. But at the same time, Nguyen reminds that the new Democratic majority on the Dallas court is not a monolithic block, as four of those justices joined the majority while four dissented.

The second case, In re: Parks, No. 05-19-00375-CV (Feb. 18, 2020) (mem. op.), denied a mandamus petition about a trial court order striking counteraffidavits related to the reasonableness and necessity of certain medical expenses filed under Chapter 18 of the Civil Practice and Remedies Code.

Republican Justice Bridges, joined by Democratic Justice Carlyle, drew an analogy between the trial court’s ruling and an order striking expert-witness designations, which is not ordinarily a basis for mandamus relief.

Republican Justice Schenck—who wrote the Nguyen concurrence—dissented, arguing that the present state of Dallas law “raises serious constitutional concerns related to the parties’ rights to a trial by jury, as well as their due process rights….” While from the same party as Justice Bridges, the two differed on an important procedural point about the balance of power between trial and appellate judges.

Going forward, these two cases are a good reminder that party affiliation, while important, is far from dispositive as to how a particular justice may approach a case.

(A similar article appeared this week in the Texas Lawbook. My LPCH partner Jason Dennis represents the Nguyens.)

The majority and dissenting opinions in In re: Baby Dolls — an interesting mandamus case to be discussed next week — are both written in fourteen-point font.

The appellate bar rejoices.

By early 2019, the attorney-client relationship between Klein and McCray was disintegrating. With a summary judgment hearing looming, Klein moved for continuance and asked for latitude at the hearing “because my client has not provided me with key materials” and discussing the topic of his withdrawal. The trial court then granted summary judgment against McCray (in an order that Klein agreed to “as to form”), after which Klein moved for withdrawal and was allowed to do so.

McCray sought relief from the judgment, “denying he received notice of the summary judgment motion from Klein.” This request led to a difficult, but outcome-determinative question, as to whether Klein’s knowledge should be imputed to McCray, despite their deteriorated relationship:

If [McCray] is correct in his position on the law and facts, then Craddock applies to his claim because it means he would have had no notice of the motion, the failure to respond, or the summary judgment hearing, and a motion for new trial is the proper method to challenge the summary judgment. If he is incorrect on his no-imputation argument, then Carpenter applies and he is required to challenge the trial court’s denial of his motion for continuance for an abuse of discretion, which he has not done.

The Fifth Court held that “[b]ecause Klein was still actively (if not sufficiently) representing [McCray] prior to and at the summary judgment hearing, Klein’s knowledge is imputed to [McCray].” McCray v. McCray, No. 05-19-00556-CV (Feb. 20, 2020).

The Committee for a Qualified Judiciary has published its list of local judicial candidates found qualified.

Bad service was found, and a restricted appeal succeeded, in Plummer v. Enterra Capital when the citation described the documents served (without attachments) as:

and otherwise: “The E&P citation was to be served on Plummer as E&P’s registered agent on Ridgeview Drive in Richardson, but handwriting next to the printed address showed an address on Arapaho Road in Richardson for a different entity, Richmond Engineering, Inc. Both of the returns show service at the Arapaho Road address. The Officer’s Return on each citation showed service on November 16, 2018, but the blank following ‘by delivering to the within named’ was not filled in on either return.” No. 05-19-00255-CV (Feb. 20, 2020) (mem. op.)

In re Parks denied a mandamus petition arising from the striking of counteraffidavits, related to the reasonableness and necessity of certain medical expenses, filed pursuant to Chapter 18 of the Civil Practice and Remedies Code. Applying Fifth Court precedent, the Court drew an analogy to the striking of expert designations, which is not ordinarily addressed by mandamus review. A dissenting opinion argued that “our existing construction raises serious constitutional concerns related to the parties’ rights to a trial by jury, as well as their due process rights to a decision on the merits and to appellate review,” and would have considered the merits of the petition. No. 05-19-00375-CV (Feb. 18, 2020) (mem. op.)

Morales v. Barnes reminds how an appellate mandate should guide further trial-court proceedings: “Our December 29, 2017 judgment and related mandate, however, rendered a partial judgment dismissing only Barnes’ claims based on the second letter. We affirmed the trial court’s denial of the motion to dismiss Barnes’ claims based on the first letter and we remanded those claims to the trial court for further proceedings. We conclude that by dismissing any claims based on the first letter, the trial court’s order was inconsistent with and failed to give full effect to our December 29, 2017 judgment and related mandate.” No. 05-18-00767-CV (Feb. 7, 2020) (mem. op.)

Jones v. Schachar succinctly summarizes compliance with Malooly:  “The appellant can do this by either asserting a separate issue challenging each possible ground, or asserting a general issue that the trial court erred in granting summary judgment and within that issue providing argument negating all possible grounds upon which summary judgment could have been granted.” No. 05-19-00188-CV (Feb. 11, 2020) (mem. op.)

The Nguyens, owners of a nail salon, sued their landlord for alleged misrepresentations related to lease renewal. They won a judgment in their favor after a jury trial; a Fifth Court panel reversed and rendered judgment for the landlord. The Court granted the Nguyens’ motion for en banc rehearing, which produced these three points of view after oral argument:

1. A majority of justices denied the request for en banc review in a short, one-line order (Justices Bridges, Myers, Whitehill, Schenck, Osborne, Pedersen, Reichek, Carlyle, Evans, and from the original panel, Justice Fillmore).
2. A short concurrence underscored the importance of a judge’s power to set aside a jury verdict when required by law (Justice Schenck, joined by Justices Bridges and Evans) (as all three concurring Justices are named “David,” one could say they viewed the case in “3-D”)
3. Four justices dissented, emphasizing the importance of jury deliberations to the civil justice system (Chief Justice Burns, joined by Justices Molberg, Partida-Kipness, and Nowell).

No. 05-17-00151-CV (Feb. 10, 2020) (My LPCH partner Jason Dennis represented the Nguyens.)

An in-house lawyer for Ruhrpumpen, Inc., a company involved in substantial patent litigation, claimed an interest in the contingent fee agreement of the company’s outside counsel. The Fifth Court rejected the claim, holding: “[W]e conclude that a company’s general counsel owes the company a fiduciary duty not to accept compensation from anyone other than the company for working on a case for the company or for referring the case to a law firm without disclosing that compensation to the company and getting the company’s consent. In this case, Moore did not have authority to consent on Ruhrpumpen’s behalf to the fee-sharing agreement unless he had disclosed the agreement to the management of Ruhrpumpen other than himself.The record establishes that Moore did not disclose the fee-sharing agreement to Ruhrpumpen’s managers. Therefore, Moore did not have authority to consent to the fee-sharing agreement on Ruhrpumpen’s behalf.” Cokinos, Bosien & Young v. Moore, No. 05-18-01340-CV (Feb. 4, 2020) (mem op.)

“The contract, which neither side contends is ambiguous, bears Mr. Turnbow’s signature and does not mention PMC Chase or indicate representative capacity in any way. Thus, on its face, the contract unambiguously shows it is the obligation of Mr.Turnbow personally.” Accordingly, among other reasons, judgment against Mr. Turnbow was affirmed. PMC Chase, LLP v. Branch Structural Solutions, Inc., No. 05-18-01383-CV (Jan. 28, 2020) (mem. op.).

Last Friday’s opinion by the Texas Supreme Court in St. John Missionary Baptist Church v. Flakes reversed St. John’s Missionary Baptist Church v. Flakes, 547 S.W.3d 311 (Tex. App.–Dallas 2018) (en banc). The law of appellate briefing waiver now has (at least) these features:

1. Waiver occurs when (a) the defendants move for summary judgment on two grounds that each are an “independent basis” for judgment (limitations and release), (b) the trial court grants the motion without specifying a reason, and (c) “[o]n appeal, the plaintiff challenged the validity of the release in question but did not address the defendants’ statute-of-limitations argument.” In this situation, the trial court’s judgment “must stand, since it may have been based on a ground not specifically challenged by the plaintiff and since there was no general assignment that the trial court erred in granting summary judgment.” Malooly Bros., Inc. v. Napier, 461 S.W.2d 119 (Tex. 1970).
2. Waiver does not occur when – and a court may thus request supplemental briefing if that would be helpful – when the defendants seek dismissal based on two doctrines (standing and ecclesiastical abstention), the substance of which “significantly overlaps.” The supreme court found such an “overlap” in Flakes when consideration of both doctrines required review of the applicable church bylaws and church membership situation. Two other examples cited in Flakes involve arguments about equitable relief related to points about money damages (First United Pentecostal Church v. Parker, 514 S.W.3d 214 (Tex. 2017)), and an issue about the applicability of a specific case in a broader dispute about the right to terminate a lease (Rohrmoos Venture v. UTSW DVA Healthcare, 578 S.W.3d 469 (Tex. 2019)).
3. Supplemental briefing is discretionary under Flakes; cf. Horton v. Stovall, No.18-0925 (Tex. Dec. 20, 2019) (finding that an appellant should have been given the opportunity to cure the particular record-citation issues identified in that case).

“We are bound by this Court’s prior precedent requiring exceptionally strict compliance with rule 52.3(j)’s requirements. To comply with prior opinions of this Court that interpret mandamus rules, relators should use the exact words of rule 52.3(j) without deviation in their certification: ‘I have reviewed the petition and concluded that every factual statement in the petition is supported by competent evidence included in the appendix or record.’ Because Mr. Stewart failed to use the precise words in the rule, we are bound by precedent to deny mandamus.” In re Stewart, No. 05-19-01338-CV (Jan. 24, 2020) (mem. op.) (emphasis added).

Underscoring its 2019 opinion in RWI Construction v. Comerica Bank, the Fifth Court reminded that “the ancient and controlling rule forecloses resort to injunctive relief simply to sequester a source of funds to satisfy a future judgment.” Acknowledging that the “general rule would not control where there is a logical and justifiable connection between the claims alleged and the acts sought to be enjoined, or where the plaintiff claims a specific contractual or equitable interest in the assets it seeks to freeze,” it found no such connection here: “Lake Point has not established any right to the funds in Renovation Guru’s Bank of America account.Instead, this injunction mirrors the RWI injunction on general capital call funds, which served only the improper purpose of assuring future satisfaction of a subsequent judgment.” Renovation Gurus, LLC v. Lake Point Assisted Living, LLC, No. 05-19-00499-CV (Jan. 29, 2020) (mem. op.).

The Fifth Court gives some highly practical guidance about the enforcement of noncompetition agreements in Gehrke v. Merritt Hawkins & Assocs.

As to the scope of activity, the Court reminded: “Covenants not to compete prohibiting solicitation of clients with whom a former salesman had no dealings are unreasonable and unenforceable. . . . . However, when an employer seeks to protect its confidential business information in addition to its customer relations, broad non-solicitation restrictions are reasonable.” Here, “the record demonstrates [Defendant] was much more than a mere salesman–he was an executive and vice president with intimate knowledge of MHA’s confidential business information and trade secrets who also supervised other salesmen.”

As to geographic scope, the Court concluded that “the trial court abused its discretion by misapplying the law to the facts in failing to enforce a geographic restriction for all states where Gehrke had worked during his final year at MHA, including the entirety of the Contested States. Additionally, we conclude the trial court abused its discretion by imposing the arbitrary ten-mile radius restriction because neither party presented evidence supporting that restriction.”  No. 05-18-01160-CV (Jan. 23, 2020) (mem. op.) (citations omitted from all quotes, all emphasis added).

In Energy Transfer Partners v. Enterprise Products Partners, the Texas Supreme Court resolves a Texas-sized partnership dispute in favor of contractual waivers of partnership. No. 17-0862 (Tex. Jan. 31, 2020). The underlying case arose from a $550 million judgment entered in 2014 in Dallas County, later reversed by the Dallas Court of Appeals; this opinion affirms the Fifth Court’s judgment.

Lovern sued Eagleridge Operating for injuries suffered in a gas line rupture. Eagleridge named Aruba Petroleum as a responsible third party; the Fifth Court found no abuse of discretion in striking that designation. The panel majority concluded that Aruba could not be liable based on the premises-liability analysis in Occidental Chemical v. Jenkins, 478 S.W.3d 640 (Tex. 2016). In re Eagleridge Operating, No. 05-19-01171-CV (Jan. 24, 2020) (mem. op.). A dissent reached a different conclusion, arguing that “[t]he majority opinion’s logic is flawed because it ignores the fact a person can simultaneously act in two different legal capacities that produce distinct legal rights and responsibilities.”

The Fifth Court reversed the denials of several special appearances in a high-profile securities case, when the plaintiffs “explicitly allege that their causes of action under sections 11 and 12 are ‘based solely on negligence and/or strict liability,'” and thus had the burden to prove only the “adverse facts that existed at the time” of the relevant offerings and its effect on the underlying business. The Court concluded that the “operative facts” related to those particular issues “are not substantially connected to Texas.” 05-19-01177-CV (Jan. 26, 2020) (mem. op.) (applying, inter alia, Moncrief Oil v. Gazprom, 414 S.W.3d 142 (Tex. 2013)).

On rehearing of Goldberg v. EMR (USA Holdings) Inc., the Fifth Court implemented the Texas Supreme Court’s December 2019 Creative Oil opinion and found that relevant communications did not adequately implicated issues of public concern to receive the TCPA’s protection: ‘The e-mails were communications because they were made by Defendants and submitted to the purchasers and suppliers. The communications were “made in connection with” “an issue related to . . . a good, product, or service in the marketplace,” scrap metal. However, all these communications were private communications between private parties about purely private economic matters. Therefore, these communications were not “made in connection with a matter of public concern” under the TCPA.’ No. 05-18-00261-CV (Jan. 23, 2020) (on motion for rehearing) (emphasis added). The Court reached a similar conclusion about other such business tort claims in Gehrke v. Merritt Hawkins & Assocs., LLC, No. 05-19-00026-CV (Jan. 17, 2020) (mem. op.)

PandaLand sought mandamus relief from the trial court’s grant of a new trial based on application of the Craddock factors. While mandamus jurisdiction has expanded for some types of new-trial grant, the Fifth Court denied relief here, stating: “Mandamus review of a trial court’s order granting a new trial is limited to orders that are void or set aside a jury verdict.” In re Pandaland Holding (HK) Ltd., No. 05-19-01259-CV (Jan. 17, 2020) (mem. op.).

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“Extrinsic evidence not before the trial court at the time of the default judgment may be considered in a motion-for-new-trial or bill-of-review proceeding, but it cannot be considered in a restricted appeal. Accordingly, even though the attachments to appellants’ notice of appeal and the documents from the other case are papers on file in this appeal, they are extrinsic evidence that cannot be considered in determining whether there is error on the face of the record.” Convergence Aviation, Inc. v. Onala Aviation, LLC, No. 05-19-00067-CV (Jan. 2, 2020) (mem. op.) (citations omitted). This includes an affidavit about whether the defendant in fact had a Texas registered agent, making service on the Secretary of State inappropriate.

Torres v. Lee offers three points to remember about deemed admissions:

• “Failure to obtain a ruling on the motion for leave to file late responses precludes complaint of the action of the trial court in deeming the requests for admission admitted” (citations omitted);
• A lack of good cause can be found when: “Upon receipt of the trial court’s order, Torres could have promptly filed a motion to withdraw admissions. Instead, he waited to file his motion to strike until the defendants filed their motion for summary judgment—over six months later and just two weeks before the scheduled trial date”;
• Undue prejudice can be found when: “Over six months later and just two weeks before the scheduled trial date, the defendants filed their motions for summary judgment based on the pleadings, Torres’s deemed admissions, and the trial court’s order with respect to the admissions. Defendants’ motions finally motivated Torres to file his motion to strike”

No. 05-18-00631-CV (Jan. 3, 2020) (mem. op.)

“Appellants argue, with some logical force, that the ‘tolling’of limitations in a fraudulent concealment case involving silence by a physician and hospital does not end when the patient is discharged from the hospital or at the patient’s last visit to a physician, but instead ‘runs until the plaintiff discovers the fraud or reasonabl[y] could discover the fraud.’ This is so, they say, because limitations naturally runs from the date of last treatment, so fraudulent concealment estoppel provides no additional benefit to plaintiffs like them. Unfortunately, appellants cite no authority for that proposition and we have found none.When appellants’ relationships with Dr. Courtney and Baylor Frisco terminated, so did those health care providers’ duty to disclose. Thus, the statute of limitations as to Dr. Courtney and Baylor Frisco began to run at that time.” Tarrant v. Baylor Scott & White Med. Center-Frisco, No. 05-18-01129-CV (Jan. 15, 2020) (mem. op.) (emphasis added, citations omitted).

“[T]the county court issued the writ of possession on July 10, and Brenham vacated the Property on or about July 14. Brenham did not testify at trial that she abandoned the Property as a direct consequence of the triggering acts; however, she testified she vacated after the writ of possession issued:

[Counsel]: And finally a writ of possession was issued, and you moved out of the premises?

[Brenham]: Yes.

. . .  Viewing the evidence under the appropriate standard, we conclude there is no evidence Brenham abandoned the Property as a direct consequence of the triggering acts. Instead, the record establishes the opposite: that Brenham vacated only after being lawfully evicted.” Kemp v. Brenham, No. 05-18-01377-CV (Jan. 14, 2020) (mem. op.)

“‘[M]andamus is governed largely by equitable principles, and“a petition for mandamus may be denied under the equitable doctrine of laches if the relator has failed to diligently pursue the relief sought,’ . . . ‘[E]quity aids the diligent and not those who slumber on their rights.’ However, laches does not apply when the order subject to the mandamus proceeding is void. To the extent [Petitioner]’s issues establish that the turnover order, and the subsequent clarification order, are void, mandamus is proper in this case.” Goin v. Crump, No. 05-18-00307-CV (Jan. 8, 2020) (mem. op.) (citations omitted, emphasis added).

Tex. R. Civ. P. 301 says: “The judgment of the court shall conform to the pleadings, the nature of the case proved and the verdict, if any, and shall be so framed as to give the party all the relief to which he may be entitled either in law or equity.” Guillory v. Dietrich applied that rule, observing that “a judgment for money damages in excess of the amount pleaded cannot be supported,” and held: “Dietrich specifically pled that appellants had been unjustly enriched in the amount of ‘approximately $24,280.00’” representing Dottie’s share of federal income taxes that Dietrich paid. Although he pled for other damages as well, he did not plead unjust enrichment as a basis for recovering them. We conclude that the trial court erred by awarding Dietrich more than $24,280 as unjust enrichment damages.” No. 05-18-00504-CV  (Jan. 6, 2020) (emphasis added).

The trial court required that a judgment debtor turn over certain “malpractice, Deceptive Trade Practices Act (DTPA), and Insurance Code claims to a receiver who is authorized to settle the claims and to pay the settlement proceeds to the judgment creditor in satisfaction of the underlying judgment.” The Fifth Court “conclude[d] that the turnover of each of the foregoing claims, with the exception of one c’laim asserted under the Insurance Code, is void because it is against public policy.” Goin v. Crump, No. 05-18-00307-CV (Jan. 8, 2020) (mem. op.)

The unfortunate Mr. Cerullo had his home managed three times by storms. The resulting coverage litigation led to a dispute about allocation among insurers, as to which the Fifth Court  held:

But because the Insurers wrongfully refused to defend Vines-Herrin [the builder] or participate in the arbitration, they lost their opportunities to require that Cerullo and Vines-Herrin allocate an exact amount of damages to the relevant policy period or to request that the arbitrator do so. At the arbitration, Cerullo’s burden was to prove and obtain damages for all of the problems at his home, regardless of the date of occurrence, and Vines-Herrin’s burden was to prove that its negligence was not the cause of any of the problems in question. Neither was required to meet the extra burden of proving exactly how much of the damage occurred on any particular day. Neither was required to establish any sort of allocation among the absent insurers, and the arbitrator was not asked to make one. Consequently, this case presents a problem similar to that of the time on the risk cases, that is, how to apportion an established total amount of damages among the insurers whose policies were in effect during the time a portion of the loss was suffered by the insured.

Great American Lloyds Ins. Co. v. Vines-Herrin Custom Homes, LLC, No. 05-18-00337-CV (Jan. 8, 2019) (emphasis added).

Like Wile E. Coyote struggling to find Road Runner, attorneys and judges often wonder what level of detail is needed for findings of fact. The Fifth Court provided strongly-worded guidance in Guillory v. Dietrich:”Many fact findings in this case have no obvious relevance to any ultimate issue, such as finding 30 (“[Dietrich] was employed by Procter & Gamble for over 40 years.”). These additional findings concern evidentiary matters instead of controlling issues. As such they are unnecessary. . . . We disregard such findings in this opinion. Moreover, the unnecessary findings made our task in resolving this appeal, and presumably appellants’ task in briefing it, more difficult. A trial court should make findings as to only disputed facts significant to the case’s ultimate issues. Findings that a jury would be asked to make in a case may be an appropriate guide. Although we impose no consequences for the excessive findings in this case, excessive findings that obscure rather than clarify the judgment’s basis may lead to consequences such as remand for proper findings or sanctions.”   No. 05-18-00504-CV (Jan. 6, 2020) (citation omitted).

In the Fifth District of Texas, the law is clear that a civil-conspiracy finding “remains a valid basis for joint and several liability even when [TCPRC] Chapter 33’s joint and several liability conditions are not satisfied.” Guillory v. Dietrich, No. 05-18-00504-CV (Jan. 6, 2020), reinforced the Fifth Court’s prior holding on this point in LandAmerica Commonwealth Title Co. v. Wido, No. 05-14-00036-CV, 2015 WL 6545685 (Tex. App.–Dallas Oct. 29, 2015, no pet.) (mem. op.), noting the subsequent opinions in Agar Corp., Inc. v. Electro Circuits Int’l, LLC, 580 S.W.3d 136 (Tex. 2019), and Stephens v. Three Finger Black Shale P’ship, 580 S.W.3d 687 (Tex. App.–Eastland 2019, pet. filed)).

Tex. R. Civ. P. 263 allows a trial on stipulated facts. “Parties may submit matters in controversy to the court upon an agreed statement of facts filed with the clerk, upon which judgment shall be rendered as in other cases; and such agreed statement signed and certified by the court to be correct and the judgment rendered thereon shall constitute the record of the cause.” Lavizadeh v. Moghadam reminds that “[i]n reviewing a judgment entered pursuant to stipulated facts, we disregard the court’s findings of fact and conclusions of law . . . we consider we consider only whether the trial court correctly applied the law to the agreed facts, utilizing a de novo review.” No. 05-18-00955-CV (Dec. 13, 2019) (mem. op.)

In re Andrew Jackson provides two reminders about the record support for a mandamus petition:

1. Rule 52 statement. A petition seeking mandamus relief must contain a certification stating that the relator “has reviewed the petition and concluded that every factual statement in the petition is supported by competent evidence included in the appendix or record.” Tex. R. App. P. 52.3(j). Relator’s petition bears an inmate declaration stating relator does ‘verify and declare under penalty of perjury the foregoing statements are true and correct.’ Thus, relator’s certification does not comply with rule 52.3(j).”
2. Record proveup. When submitting a sworn record in support of a mandamus petition: “The affidavit or unsworn declaration must affirmatively show it is based on the affiant’s personal knowledge. . . . [T]he affidavit or unsworn declaration must state the affiant has personal knowledge that the copies of the documents in the appendix are correct copies of the originals.” (applying In re Butler, 270 S.W.3d 757 (Tex. App.–Dallas 2008, orig. proceeding)).

No. 05-19-01428-CV (Dec. 18, 2019) (mem. op.).

Dr. Shiwach successfully defended a tort claim against him after his insurer denied coverage, and then won a lawsuit against his carrier about its duty to defend. The Fifth Court affirmed, noting as to the key policy exclusion: “Shiwach’s potential liability could rest on the rape allegation, for which no coverage exists, or the covered allegations that Shiwach—as an individual, physician, employee, and manager of HT and UHS—(1) failed to take actions to correct problems with suicides and over drugging of patients, (2) failed to provide adequate security measures and staffing, (3) negligently hired and retained employees, or (4) improperly admitted and failed to discharge patients.”

The Fifth Court found coverage, noting the importance of often-overlooked language about inclusion of other allegations in particular claims. It noted that the underlying petition “did not clearly allege whether any one act or omission caused or arose out of any other, nor did it provide any connection between the potentially covered allegations and the rape. It did not limit the potentially covered allegations in paragraphs 12 and 13 to factual conditions which purportedly created the opportunity for the rape, and it did not limit the entities’ liability (including Shiwach’s liability as an employee or manager of HT and UHS) to the rape. And although Broderick sought her ‘legal damages for the rape,’ the petition did not limit Broderick’s damages to the rape in paragraph 15, the prayer for relief. Moreover, the petition expressly alleged each ‘action or inaction’ described was a ‘proximate or producing cause’ of Broderick’s damages.” AIX Specialty Ins. Co. v. Shiwach, No. 05-18-01050-CV (Dec. 18, 2019) (mem. op.)

A counterclaim defendant sought recovery of attorneys’ fees under the relevant lease agreements, leading the Fifth Court to review and apply the current Texas Supreme Court precedents on that subject:

1. One set of leases had the following fee provisions:

29.1 Attorney Fees. If this lease is placed in the hands of any attorney due to a default in the payment or performance of any of its terms, the defaulting party shall pay, immediately upon demand, the other party’s reasonable attorney fees, collection costs, costs of litigation, even though no suit or action is filed thereon, and any other fees or expenses incurred by the nondefaulting party.

29.2 Types of Fees. For purposes of this Lease the term attorney fees includes all

charges of the prevailing party’s attorneys and their staff (including without limitation legal assistants, paralegals, word processing, and other support personnel) and any post-petition fees in a bankruptcy court. . . .

The Court reasoned: “Under the broad language of [these] Leases, we agree, as the court did in Rohrmoos, that appellee was not just a plaintiff; he also successfully defended against appellants’ breach of contract counterclaim that sought unpaid lease payments and repair costs for damages to the premises,” and was thus entitled to fees as a “prevailing party” .

2. The second set of leases had this fee provision:

30. Attorneys’ Fees. In the event either party shall fail to comply with any of the covenants, conditions, obligations, rules, or regulations imposed by this Texas Commercial Lease or the laws of the state of Texas, and suit is brought for damages or enforcement, the losing party shall pay to the prevailing party reasonable attorneys’ fees, costs, and expenses incurred in prosecuting these suits.

“Here, the lease specifically requires that the attorneys’ fees be incurred by the
‘prevailing party’ in ‘prosecuting these suits.’ ‘Prosecute’ means ‘to institute legal proceedings against’ or ‘to institute and carry on a legal suit or prosecution: sue.'” Accordingly, the clause did not reach the counter-defendant’s claim, and recovery of fees was prohibited by Intercontinental Group v. KB Home, 295 S.W.3d 650 (Tex. 2009). Desio v. Del Bosque, No. 05-19-00224-CV (Dec. 19, 2019) (mem. op.)

(This is a cross-post from 600Hemphill, our firm’s brand-new blog about the Texas Supreme Court.)

The “Lehmann problem” – the question of when a judgment is truly final (and thus starts the appeal deadline) is a perennial challenge in Texas cases involving multiple parties and issues. The problem has drawn particular attention recently in recent months in family-law cases, where judges often prepare a letter or memo summarizing key rulings. Reversing a Dallas case that found such an instrument to be a final judgment, the Texas Supreme Court held: “[A]n order lacking the unmistakable language of finality—that it resolves all claims between and among all parties and is final and appealable—is ambiguous in a suit under the Family Code when the order does not comport with the statute governing final orders and is otherwise inconclusive as to its intent. If a judicial decree’s finality is ambiguous, a reviewing court should examine the record to determine the trial court’s intent.” In the Interest of R.R.K., No. 18-0273 (Dec. 13, 2019). The opinion also reviews the general contours of the test for judgment finality in Texas.

161 days after a “dwop” dismissal, the plaintiff learned of that order by reviewing the court website, and successfully sought reinstatement. In re Mart, No. 05-19-01355-CV (Dec. 9, 2019) (mem. op.) Tex. R. Civ. P. 306a, however, only extends the trial court’s plenary power if notice is acquired within 90 days of judgment. Observing that “the cases real party cites demonstrate she had potential avenues to obtain reinstatement of the case other than a Rule 306a(4) motion and motion to reinstate, including a restricted appeal and a bill of review,” the Fifth Court granted mandamus relief because the trial court’s reinstatement order was void.

Not without meeting a demanding standard: “Texas uses a functional approach in determining whether a person is entitled to absolute derived judicial immunity. Under this approach, we must ‘determine whether the activities of the person seeking immunity are intimately associated with the judicial process and whether the person exercised discretionary judgment comparable to a judge, as opposed to ministerial or administrative tasks.’ In other words, ‘[i]f an action involves personal deliberation, decision or judgment, it is discretionary; actions requiring obedience to orders or the performance of a duty to which the actor has no choice are ministerial.'” (citations omitted, emphasis added).  In Manning v. Jones, the Fifth Court found a receiver immune from suit for actions taken in connection with a property transactionn that she had been appointed to handle. No. 05-18-01140-CV (Dec. 4, 2019) (mem. op.)

The Fifth Court conditionally granted mandamus relief as to an order quashing a postjudgment deposition, observing: “[T]rial courts have discretion to control the nature and form of discovery, but that discretion is not unlimited. ‘A trial court abuses its discretion by limiting discovery in the absence of some evidence supporting the request for a protective order.’ In this case, counsel for [movant] presented arguments at the hearing on the motion to quash but did not present evidence in support of the motion. [Movant’s] motion was unverified;the transcript from the April 3, 2019 hearing on the motion to dissolve was not made a part of the record at the hearing on the motion to quash; nor did her counsel request the trial court to judicially notice the evidence from the prior hearing. Because no evidence was presented in support of [Movant’s] motion, we conclude the trial court abused its discretion in granting the motion to quash and motion for protective order.” In re Mustang Asset Recovery Ltd., No. 05-19-01036-CV (Dec. 6, 2019) (mem. op.) (emphasis added, citations omitted).

In an unusually nutty case, the parties’ arbitration clause provided:

All disputes, claims, or controversies arising out of or relating to this Agreement, or the breach thereof, except as to the quality of the product delivered, shall be settled solely by arbitration held in Dallas, Texas, in accordance with the rules then obtaining of the American Arbitration Association, and judgment upon any award may be entered in any court having jurisdiction thereof.

(emphasis added). The plaintiff’s allegations “[a]ll . . . concern whether the pecan pieces San Saba sold contained pecan weevil larvae so that they were not merchantable and were unfit for human consumption” – in other words, claims about “the quality of the produce delivered” within the meaning of the above carveout. The Fifth Court thus affirmed the trial court’s denial of a motion to compel arbitration. San Saba Pecan LP v. Give & Go Prepared Foods Corp., No. 05-19-00214-CV (Dec. 6, 2019) (mem. op.)

Faced with a lack of appellate jurisdiction because of a nonfinal order, a party suggested abatement to cure the problem rather than dismissal. The Fifth Court rejected that request: “In so doing, we note nothing in the record reflects determination of the counterclaims will be perfunctory.  Nor does the record reflect a determination is imminent. No trial date has been set, and the record reflects December 20, 2019 is the date set for a hearing on appellant’s motion to set a trial date.” Dixon v. Principal Management Group, Inc., No. 05-19-00895-CV (Dec. 3, 2019) (mem. op.) (citations omitted).

The current state of play about the TCPA in the Fifth Court is well-illustrated by Rouzier v. BioTE Medical, LLC, No. 05-19-00277-CV (Nov. 22, 2019) (mem. op.) (applying, inter alia, Forget About It, Inc. v. BoiTE Medical, LLC, No. 05-18-01290-CV, 2019 WL 3798180 (Tex. App.—Dallas Aug. 13, 2019, pet. filed). It addresses the application of the TCPA’s protection of speech and association rights to business-related communications in the healthcare industry, as well as the application of the commercial-speech exemption in that setting.