Texas Appellate Lawyer & Attorney : D. Todd Smith Law Firm : Appeals, Sanctions, Summary Judgment : Austin, Texas

As reported in The Houston Chronicle, a group of 11 plaintiffs have brought a putative class action in federal district court in Marshall seeking to have the Chapter 74 medical malpractice damage caps declared unconstitutional.  Among the plaintiffs is former Dallas Cowboy Ron Springs, who has been in a coma since late last year following surgery to remove a cyst.

The lawsuit, styled Watson et al. v. Harrison County Hospital Association et al. (Civil Action No. 2:08-CV-00081), has been assigned to U.S. District Judge John Ward.  A copy of the complaint is available here.

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The Texas Supreme Court issued one opinion other than the new decision in Frank's Casing with today's orders.  In DaimlerChrysler Corp. v. Inman (No. 03-1189) (written by Justice Hecht, joined by Justices Wainwright, Brister, Medina, and Willett), the Court dismissed a putative class action for want of jurisdiction on the ground that the plaintiffs' claims—which involved seat belt buckles that were allegedly too easy to unlatch unintentionally—were too speculative and hypothetical to confer standing.

Chief Justice Jefferson (joined by Justices O'Neill, Green, and Johnson) dissented on the ground that the majority "improperly equates standing with the merits of the plaintiffs claim" in contravention of "fundamental tenets of the standing doctrine, our rules of procedure, and the statute governing interlocutory appeals."

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The Texas Supreme Court handed down six decisions with this week's orders.

In Mid-Century Insurance Co. v. Ademaj (No. 05-0016), a declaratory judgment action, the Court held that insurers may lawfully collect Texas Automobile Theft Prevention Authority fees from auto insurance policyholders without including such fees in rate filings required under Article 5.101 of the Insurance Code.  Because the trial court and court of appeals concluded otherwise, the supreme court reversed and rendered judgment that plaintiff take nothing.  Justice O'Neill (joined by Justice Medina) issued a concurring opinion.

In Houston Municipal Employees Pension System v. Ferrell (No. 05-0587), the Court held that 29 members of the Pension System could not bring a declaratory judgment action to adjudicate their rights under the statute that created the System.  Because the statute expressly provides that the administrative agency's interpretation is "final and binding on any interested party," the Court held that the trial court lacked jurisdiction over the case, reversed the court of appeals' judgment, and dismissed for want of jurisdiction.  Justice Brister (joined by Justice O'Neill) concurred.

In Montgomery County, Texas v. Park (No. 05-1023), the Court defined an "adverse" personnel action under the Texas Whistleblower Act (which provides no definition) as one that "would be likely to dissuade a reasonable, similarly situated worker from making a report under the Act."  Concluding thatplaintiff failed to meet that definition, the Court reversed the court of appeals' judgment and rendered judgment for the County.

In Ogletree v. Matthews (No. 06-0502), the Court determined that a defendant in a health-care liability action has no right to an immediate interlocutory appeal when the trial court denies a motion to dismiss and grants the claimant a 30-day extension of time to cure defects in otherwise timely served expert reports.  Because the court of appeals reached the same conclusion, the supreme court affirmed the lower court's judgment.  Justice Willett delivered a concurring opinion.

In Best Buy Co. v. Barrera (No. 07-0028) (per curiam), a class action in which plaintiffs sought return of restocking fees, the Court followed its recent decision in Stonebridge Life Insurance Co. v. Pitts andconcluded that individual issues will predominate over common issues of proof.  Holding that plaintiffs thus failed to satisfy TRCP 42(b)(3)'s predominance requirement, the Court reversed the court of appeals' judgment affirming the class-certification order and remanded the case to the trial court.

In In re McKee (No. 06-0055) (orig. proceeding) (per curiam), the Court denied a mandamus petition seeking to invalidate an administrative judge's assignment of one trial judge to hear a recusal motion involving another trial judge when the administrative judge had previously recused himself from the case.  Noting that it had previously declined mandamus relief from the denial of a recusal motion, the Court applied the updated Prudential standard and concluded that there would be no significant benefit to granting relief in this case.

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In Vaughn v. American Honda Motor Co. (No. 07-41056), the Fifth Circuit has held that the district court's decision to require any objector to a class action settlement to post a $150,000 bond for costs on appeal was an abuse of discretion.  Concluding that the district court could not use FRAPs 7 and 38 to effectively bar an appeal, the circuit court reduced the bond amount to $1,000.

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The Texas Supreme Court issued four opinions with this week's orders.

In In re U.S. Home Corp. (No. 03-1080) (per curiam), a dispute between a homebuilder and purchasers, the Court conditionally granted mandamus relief from a trial court order refusing to compel arbitration, holding that no evidence supported any of the asserted defenses to enforcement of the arbitration clause.  The Court declined the defendants' invitation to reverse the trial court's class certification order because the court of appeals had not yet ruled on that request.

Answering certified questions from the Fifth Circuit in Mid-Continent Insurance Co v. Liberty Mutual Insurance Co. (No. 05-0261), the Court held under the facts of the case that one insurer owed a second insurer no duty (directly or by subrogation) to compensate the second insurer for paying more than its proportionate share of a settlement to which both contributed.  Justice Willett delivered a concurring opinion providing his additional thoughts on why Texas law should not recognize such a claim.

In In re SCI Texas Funeral Services, Inc. (06-0385) (per curiam), the Court conditionally granted mandamus relief from discovery and sanctions orders in a putative class action because the court of appeals' reversal of class certification "render[ed] the class-wide discovery superfluous and the class-wide sanctions incongruous."

In BFI Waste Systems of North America, Inc. v. North Alamo Water Supply Corp. (No. 06-0602) (per curiam), the Court denied both petitions for review, but indicated that the court of appeals (in footnote 6 of its opinion) had improperly commented on the validity of a discharge permit, an issue not before that court.  The supreme court agreed with petitioners' argument that the court of appeals' comments should not prejudice future litigation over the discharge permit.

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In Levy v. OfficeMax, Inc., the Third Court of Appeals has reversed the dismissal of class claims that OfficeMax and Best Buy must assign tax refund rights to customers who mailed in product rebates.  On remand, the trial court will consider whether such assignments can be compelled and whether a class should be certified.

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Yesterday's post from Stephen Gardner at the Consumer Law and Policy Blog began like this:

Last [Friday], the Texas Supreme Court drove another nail in the class action coffin.  Justifiably, Texas is now considered by most class action lawyers (on both sides of the aisle) to be the state most hostile to class actions.  One judge commented to the author, I dont know why anyone would bring a class action in state court in Texas because as far as I can tell, the Texas Supreme Court has abolished class actions—it just hasn't said so.  In Citizens Insurance Company of America v. Daccach[], Texas's High Court tightened the class action noose a bit further. . . .

After recounting the recent history of class action jurisprudence in Texas and criticizing what he considers to be inconsistencies in the Court's opinion, Gardner ends the post with this thought:

Since the phrase Judicial Hellholes has been appropriated by defenders of the defense industry, I nominate Texas for a preeminent position in a new list of Dens of Iniquity.

Wow.

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Blawgletter bills itself as "Business trial law with a sense of humor."  Anyone doubting this description should take a look at author Barry Barnett's two most recent posts.

In the first, Barry reviews Friday's Texas Supreme Court decision in Citizens Insurance Co. v. Daccach in light of Chief Justice John Marshall's immortal observation from McColloch v. Maryland, 17 U.S. 316 (1819):  "That the power to tax involves the power to destroy [and] that the power to destroy may defeat and render useless the power to create . . . are propositions not to be denied." In Barry's view, by sending the class plaintiffs back to square one after eight years in the court system, with another interlocutory appeal likely, the supreme court has "taxed" the Daccach class into oblivion.

In the second post, Barry simply observes that the defendants won every case handed down with last week's orders. Something is left unstated; Barry leaves it to the reader to figure out what that is.

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It's been a busy week at the Texas Supreme Court.  Today's orders included opinions in the following six cases:

In Citizens Insurance Co. v. Daccach, the court of appeals affirmed the trial court's certification of a worldwide class of securities purchasers. The supreme court reversed,decertified the class, and remanded the case to the trial court, concluding that the trial court failed to consider how res judicata affected the class representative's adequacy, the superiority of litigating the case as a class action, the typicality of claims within the class, and the predominance of common issues.  Chief Justice Jefferson and two other justices concurred.

In Moki Mac River Expeditions v. Drugg, the Court held that the plaintiffs did not establish specific jurisdiction over a nonresident defendant.  The Court reversed and remanded the case with instructions that the court of appeals consider whether the defendant is subject to general jurisdiction in Texas.  Justice Johnson, joined by Justice Medina, dissented.

In City of Galveston v. State of Texas, the Court held that the state bears the burden of showing that the legislature allows the state to sue cities.  Because the state failed to meet that burden in this negligence case involving water damage to a highway, the Court reversed and rendered.  Justice Willett, along with three others, dissented.

In In re Discount Rental, Inc., the per curiam Court conditionally issued a writ of mandamus directing the trial court to vacate an order that a judgment debtor's property be sold to satisfy a void judgment.

In Varner v. Cardenas, the per curiam Court concluded that the court of appeals correctly reversed and remanded the trial court's judgment for segregation of recoverable from unrecoverable attorney's fees, but modified the court of appeals' judgment on the basis that the lower court defined recoverable fees too narrowly.

In Ontiveros v. Flores, the per curiam Court held that the court of appeals erred by reversing the trial court's summary judgment on claims the appellant had not raised on appeal.

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