In this edition of Litigation Roundup, Kroger strikes an $83 million deal to bring an end to opioid epidemic claims in Texas, the state is given a deadline to reply to a rehearing request in the longrunning litigation over the safety of the foster care system and a fried chicken trademark spat lands in the Eastern District of Texas.
The Litigation Roundup is a weekly feature highlighting the work Texas lawyers are doing inside and outside the state. Have a development we should include next week? Please let us know at tlblitigation@texaslawbook.net.
Harris County District Court
County Sues ‘Predatory’ Real Estate Companies
Harris County has filed a lawsuit against a group of real estate-related companies for allegedly duping an elderly homeowner out of her property.
The case, filed Nov. 11, has been assigned to Harris County District Judge Kyle Carter. Defendants in the case include Malcolm Pryor, Ironside Builders, South Victory Group, James Mayer and Mayer Properties.
The county, which is joined by the state of Texas in bringing the lawsuit, alleges Wanda Jackson, a 71-year-old retired teacher, was the victim of fraudulent conduct perpetrated by Pryor and his company that caused her to lose both her own home in Houston and a family property in East Texas.
“Under the pretense of obtaining financing to make repairs to Jackson’s properties, Pryor through two of his many business entities, obtained title to both of Jackson’s properties,” the lawsuit alleges.
As of Monday, no hearings had been set in the case that is seeking a permanent injunction, as well as civil penalties for violations of the Texas Deceptive Trade Practices Act, real estate fraud and the recording of fraudulent liens.
If found to have violated the TDTPA, defendants face $10,000 per violation, an amount that increases to $250,000 per violation when the alleged victim is 65 years of age or older.
The county is represented by its own Jesse M. Blakley, Eleanor Matheson, Tiffany S. Bingham and Jonathan G.C. Fombonne.
Counsel for the defendants had not filed an appearance as of Monday.
The case number is 2024-79485.
Texas Opioids MDL
Texas’ Share of Settlement with Kroger Pharmacy is $83M
Kroger will pay the state of Texas $83 million to resolve claims it contributed to the state’s opioid epidemic, according to a settlement Attorney General Ken Paxton announced Nov. 14.
Paxton called the deal “an important step in our ongoing efforts to securing justice for Texas,” in a news release. About $7.2 million of the settlement is earmarked for attorney fees. Texas’ settlement is part of a roughly $1.4 billion nationwide deal the grocer struck to end opioid-related litigation.
To date, Texas has secured about $3 billion in opioid epidemic settlement funds from drug manufacturers and pharmacies.
Eastern District of Texas
KFC Files Trademark Suit Against Rival Church’s
KFC Corporation claims a rival fried chicken restaurant chain is infringing its trademark of the phrase “original recipe.”
The lawsuit was filed Nov. 8 against Cajun Operating Company, which does business as Church’s Texas Chicken. KFC, which has used the phrase since 1972, alleges Church’s began using “original recipe” in September to promote its own chicken offerings in television commercials, on its website and on social media accounts.
In its advertising campaign, Church’s touts that its “original recipe is back,” according to the lawsuit.
KFC told the court it sent Church’s a letter notifying the company of its alleged unauthorized use of the phrase in October but Church’s “ignored KFC’s letter and opted instead to expand its use and promotion of the original recipe mark.”
The U.S. Patent and Trademark Office issued trademark registrations to KFC for use of the phrase “original recipe” in November 1984, according to the lawsuit.
The case has been assigned to U.S. District Judge Sean D. Jordan.
KFC is represented by Craig McDougal, Christin Jones, Joseph Petersen and Briggs M. Wright of Kilpatrick Townsend & Stockton.
Counsel for Church’s had not filed an appearance as of Monday.
The case number is 4:24-cv-01000.
Texas Supreme Court
Justices to Decide Lease Dispute between Anadarko, Lessee
The Texas Supreme Court agreed on Friday to decide a contract interpretation dispute from the El Paso Court of Appeals that pits a lessee against Anadarko E&P Onshore.
David Cromwell, who is attempting to undo two prior rulings against him, has drawn amicus support in his appeal from both Chevron and Christopher S. Kulander, a professor at South Texas College of Law — Houston, who used to practice at Haynes Boone.
Lower courts found Cromwell’s leases had terminated at the end of their primary terms after he failed to enter a joint-operating agreement.
Cromwell has maintained that the leases haven’t terminated because, under the plain language of the agreement, that only happens if there’s no production in paying quantities coming from the lease.
“This standard text should have the same meaning across the state; it should not mean one thing in the Eagle Ford and the opposite in the Permian,” Cromwell argued in a reply brief urging review. “Nor should the interpretive rules change merely because Anadarko finds itself on the opposite side of the ‘v.’ The oil and gas industry depends on stable application of this Court’s teachings. This Court should reject the El Paso Court’s implied-termination rule, hold that Cromwell’s leases have not expired, and remand for the court of appeals to address the parties’ remaining arguments on the merits.”
Chevron explained it is interested in the case “because its leasehold, mineral and royalty interests may be affected by the title uncertainties caused by” the lower court rulings against Cromwell.
“In Cromwell, the El Paso Court of Appeals takes a position that is diametrically opposed to the longstanding fealty to the freedom of contract principle that prohibits courts from rewriting contracts,” Chevron told the court.
“In addition to being contrary to the freedom of contract principle, the result is also contrary to longstanding Texas contract and property interpretational jurisprudence. For over a century, that jurisprudence has consistently taken the position that there should be no implicit addition of terms to an agreement that would create an automatically-terminating limitation.”
Oral arguments are set to take place Jan. 19.
Cromwell is represented by W. Curt Webb, Thomas R. McDade, Joshua S. Smith and M. Jake McClellan of Beck Redden and L. Lee Thweatt of Terry & Thweatt.
Anadarko E&P Onshore is represented by Gwen J. Samora of Copeland & Rice.
Chevron is represented by J. Derrick Price and Bruce M. Kramer of McGinnis Lochridge.
Kulander represents himself.
The case number is 23-0927.
U.S. Court of Appeals for the Fifth Circuit
Texas Has Month to Respond to Rehearing Request in Foster Care Case
In an order issued Saturday, the Fifth Circuit gave the state of Texas until Dec. 16 to file a response to a petition for rehearing en banc in the longrunning litigation over the safety of the state’s foster care system.
On Oct. 25, Paul Yetter of Yetter Coleman and a group of other lawyers representing 7,608 foster care children in the 13-year-old litigation asked the court for rehearing in a bid to overturn a ruling that removed the district court judge who had presided over the entirety of the case, U.S. District Judge Janis Jack.
The petition also seeks to have the contempt finding against Texas reinstated.
A three-judge panel on Oct. 11 had issued a ruling removing Judge Jack from the case after finding she had acted with “implied bias” against Texas officials and reversed her order finding Texas in contempt for not following her orders requiring certain improvements in the way the foster care system operates.
In the petition for rehearing, Yetter reminded the court that six years ago it affirmed a finding that Texas’ foster care system had been “unconstitutionally dangerous for decades” and five years ago affirmed “detailed remedies” set out by Judge Jack and “mandated their implementation.”
“Since then, much progress has been made, due to the district court’s supervision, but much remains to be done,” the petition reads, urging against reassigning the case.
“If it is even possible for a new judge to catch up, that process will take significant time, while young lives hang in the balance. Each passing month the system remains out of full compliance, children are at risk of aging out more damaged than when they entered.”
Texas is represented by Allyson Ho, Bradley Hubbard, Stephen J. Hammer, Savannah C. Silver and Prerak Shah of Gibson Dunn and by its own Lanora Pettit, Kimberly Gdula and Clayton R. Watkins.
The plaintiffs are also represented by Christian J. Ward of Yetter Coleman, Stephen Dixon and Samantha Bartosz of Children’s Rights and Marcia Lowry, David Baloche and Laura Welikson of A Better Childhood.
The case number is 24-40248.
Caldwell County Can’t Keep Magistration Proceedings Closed to Public
Two news outlets and an advocacy organization had a First Amendment win upheld by the Fifth Circuit recently, after a panel determined a policy in Caldwell County barring the public from observing proceedings before magistrate judges likely violates the constitution.
The ruling affirms a decision by U.S. District Judge Robert L. Pitman granting the injunction barring the policy. Judge Pitman found the organizations — The Texas Tribune, Caldwell-Hays Examiner and Mano Amiga — were likely to succeed in showing the policy is a violation of the First Amendment, and rejected Caldwell County’s argument that the plaintiffs had no standing to bring suit.
“It is clear that each of the organizations is injured by being denied access to magistrations,” the Fifth Circuit panel wrote in the Nov. 15 ruling. “Preventing the organizations from accessing these proceedings frustrates the news organizations’ ability to keep the public informed regarding a crucial part of the criminal justice system in Caldwell County.”
Judges Wendy B. Vitter, Cory T. Wison and Dana M. Douglas sat on the panel. Judge Vitter, of the Eastern District of Louisiana, sat by designation.
The Texas Tribune, Caldwell-Hays Examiner and Mano Amiga are represented by Scott B. Wilkens of the Knight First Amendment Institute at Columbia University and Jullie Anne Ford of George Brothers Kincaid & Horton in Austin.
Caldwell County is represented by Jason Eric Magee of Allison, Bass & Magee in Austin.
The case number is 24-50135.