In this edition of Litigation Roundup, Kelley Drye lawyers secured a $590 million PFAS settlement for North Carolina, the Texas Supreme Court urged legislative reform of the state’s $25 million supersedeas bond cap, and the Fifth Circuit revived a challenge to a Lake Austin annexation ordinance for the second time. Elsewhere, a Dallas man pleaded guilty to bank fraud involving more than $15 million in stolen Treasury checks, and a Fort Worth couple was sentenced for a construction scheme that defrauded more than 40 families.
Harris County Judge Michael Gomez received the Samuel Pessarra Outstanding Jurist Award from the Texas Bar Foundation last week.
“Judge Gomez has dedicated nearly two decades to serving the people of Harris County,” Judge Gloria E. López, local administrative district judge and presiding judge of the 308th District Court, said in a news release. “His experience, professionalism, and commitment to the law have earned the respect of his colleagues and the legal community. This recognition is a fitting reflection of his years of service.”
The award recognizes an active federal or state judge with at least 10 years of service on the bench who has earned an exceptionally outstanding reputation for competency and integrity.
Judge Gomez is currently the most senior sitting judge in the Harris County district courts, having served as the presiding judge of the 129th Civil District Court since Jan. 1, 2009. He is currently serving his fifth term, which runs through Dec. 31, 2028.
A Houston native, Judge Gomez is a graduate of Rice University and the University of Houston Law Center.
Before taking the bench, his areas of practice included corporate and securities matters, commercial litigation and insurance defense.
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.
Fifth Circuit Court of Appeals
WDTX Reversed for a Second Time by the 5th Circuit
For the second time, the Fifth U.S. Circuit Court of Appeals reversed and remanded a property dispute between homeowners along Lake Austin and the city of Austin.
In 2019, the city of Austin adopted an ordinance that declared the properties along Lake Austin had always been within its jurisdiction and repealed a 1986 ordinance that declared the properties were within the city’s limited-purpose jurisdiction.
The homeowners sued in January 2021, alleging that the 2019 ordinance violated federal and state law. The Western District of Texas dismissed all claims without prejudice under the Tax Injunction Act. The Fifth Circuit has reversed all but two of the homeowners’ claims.
The Fifth Circuit panel of Judges Don Willett, Kurt Engelhardt and Dana Douglas held that the case is not moot and did not warrant Pullman abstention.
“This case is not moot. S.B. 1844 neither refunds the Homeowners’ taxes nor automatically disannexes their properties, so they retain a concrete stake in the validity of the 2019 Ordinance,” Judge Willett wrote. “The district court erred in abstaining under Pullman. No matter how the 1986 Ordinance is read, the Homeowners’ federal equal-protection claim does not depend on resolving a disputed question of Texas law. The district court should have decided it.”
He further wrote that the court remands the case to the district court for consideration of the city’s remaining grounds for dismissal.
The three undecided grounds remaining are the political-question doctrine, Burford abstention and Rule 12(b)(6) dismissal.
Christopher Johns of Cobb & Johns, William Cobb of Cobb & Gervasi, Lorri Michel of Michel Grey Rogers and Ernest Young represented the plaintiffs.
Hannah Vahl and Kelly Davis represented the city of Austin.
The case number is 25-50160.
Northern District of Texas
Couple Owes $2.7M in Restitution in Wire Fraud Scheme
Fort Worth couple Christopher Judge, 35, and Raquelle Judge, 36, were sentenced earlier this month for their roles in a yearslong fraud scheme involving dozens of victims and millions of dollars in losses.
The couple pleaded guilty in December 2025 to conspiracy to commit wire fraud.
Senior U.S. District Judge Terry R. Means sentenced Christopher Judge to six and a half years in federal prison to be followed by two years of supervised release. Raquelle Judge was sentenced to one month in prison. They were ordered to pay a total of $2,794,680.73 in restitution.
“Fraudsters who exploit hard-working families in the Northern District of Texas will face serious consequences,” U.S. Attorney Ryan Raybould said in a news release. “The Judges didn’t just abandon construction sites; their entire business model was built on lies and deceit. This kind of brazen fraud strikes at the heart of consumer trust, and our office will ensure that those who engage in such criminal conduct face justice.”
According to court documents, the Judges were managing members of Judge DFW LLC, a Texas-based company they used to falsely market themselves as providers of custom architecture, construction and interior design services. From about August 2020 through January 2023, the defendants offered below‑market bids to consumers across six counties in North Texas, inducing them to enter into design‑and‑build contracts for custom home projects.
Although victims paid multiple installment payments for their projects, the Judges failed to complete most of the work and often abandoned projects entirely, leaving victims without finished homes. The defendants also admitted to falsely representing that Christopher Judge was a licensed architect.
Court records reflect that the couple defrauded more than 40 victims across at least 24 construction projects. The defendants commingled victims’ installment payments in the primary Judge DFW operating account, frequently using individual victim installment payments for unrelated construction projects. The estimated amount of total loss is approximately $4.2 million.
Mark McDonald and Laura Montes of the U.S. attorney’s office represented the federal government.
The case number is 4:25-cr-00226.
Dallas Man Pleads Guilty to Bank Fraud
A West Dallas man pleaded guilty to bank fraud last week and admitted to using stolen identities and fake IDs to deposit over $15 million in U.S. Treasury checks intended for various businesses throughout the U.S.
Kendrick Lamont Fugett, 34, pleaded guilty before Chief U.S. District Judge Reed O’Connor. Fugett was arrested on a federal criminal complaint on Aug. 20.
“Mr. Fugett’s guilty plea reflects our office’s commitment to protecting federal funds,” U.S. Attorney Ryan Raybould said in a news release. “We will continue to work closely with our law enforcement partners to hold accountable those who steal from the American taxpayer and Main Street Americans.”
As Fugett admitted in his plea agreement, he assumed the identity of the chief financial officer of a software company based in Austin to open a business account at an Origin Bank branch in Dallas. To pass himself off as the company’s CFO, Fugett used a fake Texas driver’s license and forged corporate documents, later arranging the deposit of a Treasury refund check worth more than $13.8 million.
Fugett’s scheme extended to several other banks in the Dallas area. For example, court documents reveal that Fugett successfully deposited a refund check for more than $447,000 at a Bank of America branch in Mesquite, Texas, that had been made out to a real business. In connection with that transaction, Fugett assumed the identity of the billionaire chairman of the holding company that owns that business and presented a fake Illinois driver’s license bearing his own image.
Fugett faces a statutory maximum sentence of 30 years in federal prison. His sentencing hearing is scheduled for Jan. 14, 2027.
Ignacio Perez De La Cruz and Alexander Schwab of the U.S. attorney’s office are representing the federal government.
Kristen Beckman of the Law Office of Kristen Beckman is representing Fugett.
The case number is 3:26-cr-00585.
Western District of Texas, Austin Division
Attorney Sues VetClaims CEO for Defamation
An Illinois attorney filed suit against VetClaims.ai and its Chief Executive Officer Lukas Simianer for defamation.
According to the complaint, in 2025, a veteran told Andrew Tangen that a woman who claimed she worked for VetClaims.ai asked him for $1,250 to file a VA claim he could file for free. Tangen looked into and found VetClaims did not have accreditation from the Department of Veterans Affairs. He then referred the matter to the Illinois Attorney General.
Months after Tangen filed the report in January 2026, Simianer made a post on social media listing Tangen’s professional credentials and alleging that he “backed fraudsters from his government email to maintain … [a] monopoly.”
Tangen denied the accusation and posted the government email showing he had reported VetClaims to the attorney general. Simianer publicly called that email “manufactured.”
Simianer allegedly continued posting on social media for weeks, tagging and taunting Tangen.
“The accusations attack the honesty on which Mr. Tangen’s life’s work depends. He brings this suit to clear his name, recover the damages allowed by law, and have the statements identified in this Complaint taken down,” the complaint reads.
Tangen is seeking injunctive relief as well as exemplary damages.
U.S. District Judge Robert Pitman is presiding over the case.
Counsel for Simianer and VetClaims have not filed appearances at this time.
William Brewer, Joshua Harris, Noah Peters, Jordan Smith and Amir Saada of Brewer, Attorneys & Counselors are representing the plaintiffs.
The case number is 1-26-cv-2541.
Eastern District of Texas, Sherman Division
Man Sentenced to Over 11 Years for Money Laundering Conspiracy
A man has been sentenced to over 11 years in federal prison as part of a Homeland Security task force investigation into a money laundering conspiracy.
Norolamin Gulam, 53, a national of Mozambique living in Portugal, pleaded guilty to conspiracy to commit money laundering and was sentenced to federal prison by U.S. District Judge Amos L. Mazzant on Sept. 15. Gulam was also ordered to pay a judgment of $7.5 million.
According to information presented in court, since 2021, Gulam was identified as the leader of a transnational money laundering organization with connections and ties throughout Europe, Africa, Southeast Asia, the United States and Central and South America. Gulam used multiple businesses and real estate ventures to launder multimillion-dollar sums of drug proceeds. It is believed Gulam was responsible for laundering a minimum of $500 million in U.S. currency.
Matthew Johnson of the U.S. attorney’s office represented the U.S.
The case number is 4:25-cr-00003.
Texas Supreme Court
SCOTX Denies Rehearing of Mandamus Petition Over Supersedeas Cap, Calls for Legislative Action
Greystar Development & Construction originally filed its petition for writ of mandamus in 2024 stating it superseded the $406 million judgment by filing a $25 million bond. The trial court declared the bond invalid and permitted enforcement to proceed. The Fifth Court of Appeals granted a temporary stay and affirmed the bond order invalidating the bond.
Greystar then sought mandamus review from the Texas Supreme Court in an attempt to resolve conflicting appellate court interpretations of the $25 million supersedeas cap.
Justice Kyle Hawkins wrote a statement on the denial, which Justices Evan Young and James Sullivan joined, that appeals to the Texas Legislature for clarity.
“It does not have to be this way. The Legislature, of course, is always free to revisit any statute, and this case illustrates why the statute at issue here may warrant legislative attention,” Justice Hawkins wrote. “The divided opinions reflect that the text generates no clear or easy answer. The Court has done its best with what we have, but better still would be statutory clarity that embraced the Court’s reading, or the dissent’s, or something altogether different. Nothing precludes the Legislature from making any adjustments, large or small, to how judgments are superseded.”
“In my view, our adversarial system would be better served under the cost-shifting approach of our federal counterparts. It works like this,” Justice Hawkins wrote. “When a plaintiff wins a final judgment, the defendant holds the power to appeal, and to supersede the judgment with a bond. The prevailing plaintiff, in turn, holds the power to demand as large a supersedeas bond as the law permits — but the costs of that bond are taxable against the losing side following the resolution of the appellate process.”
Nathaniel Buchheit, Mollie Mallory, Jeff Tillotson and Jonathan Patton of Tillotson Patton; Wallace Jefferson, Rachel Ekery and Bill Boyce of Alexander Dubose Jefferson; Stephani Michel and Anne Johnson of Norton Rose Fulbright; Christopher White and Katherine Compton of Steptoe & Johnson; and Nina Cortell and Ben Mesches of Haynes Boone represented Greystar.
The case number is 24-0293
Texas Business Court, Dallas Division
Biz Court Denies Fermi Inc. Founder’s Request for a Temporary Restraining Order Against the Company
Texas Business Court Judge Brian Stagner denied the request for a temporary restraining order last week against Fermi Inc.
According to its third amended petition, Toby Neugebauer and Vicksburg Investments Management are seeking declaratory relief to “vindicate their rights as shareholders of Fermi Inc.”
Neugebauer claims the board of directors has schemed to seize control of Fermi and its business opportunities for themselves and push him out. He claims he was fired without cause after he called a special meeting of shareholders, and then they stated he had “departed” in an SEC filing.
The alleged faction of the board attempted to cancel the special shareholder meeting and asked a federal court to allow it. After the court denied the request, the board amended the bylaws to adopt a rule requiring a 70 percent shareholder vote for certain bylaw amendments, such as increasing the board size by adding new directors.
The court held a hearing Sept. 15, which narrowed the issues. Neugebauer informed the court he no longer was seeking a temporary restraining order concerning the special meeting, including an order requiring Fermi to convene it.
Counsel also acknowledged that the second amended complaint reverses the sequence of the corporation’s voting changes.
That left three requests: to restrain enforcement of the 70 percent bylaw amendment; to restrain enforcement of the director-election standard, which Neugebauer now contends should require a majority of the shares actually voted rather than a majority of all outstanding shares entitled to vote; and to restrain enforcement of the Sept. 10 nomination deadline.
“The Court does not rule on special-meeting relief, which Plaintiffs expressly excluded from their TRO request at the hearing,” Judge Stagner wrote.
Judge Stagner wrote that Neugebauer has not shown an injury requiring relief before a temporary injunction hearing. He also found that the proxy solicitation has been suspended and that they hadn’t shown a concrete nomination opportunity lost because of the Sept. 10 deadline. The director-election challenge does not establish entitlement to a temporary restraining order, Judge Stagner wrote.
He also wrote that the 70 percent threshold is not unlawful because it exceeds a majority.
The application for temporary injunction remains pending, Judge Stagner wrote.
“This order does not deny the pending application for temporary injunction, dispose of any underlying claim, or decide the pending Rule 91a motion. The Court’s assessment is limited to the present request for emergency relief and does not finally determine the validity or enforceability of the challenged corporate actions,” Judge Stagner wrote.
Jeff Tillotson of Tillotson Patton is representing Neugebauer.
Daniel David, Amy Hefley, John Lawrence and Bill Kroger of Baker Botts; Katherine DeBeer, Michael Holmes, Robert Ritchie and Craig Zieminski of Vinson & Elkins; Jaren Janghorbani and Tiana Voegelin of Paul Weiss; Paul Maslo, Gene Park, Minji Reem and Alex Spiro of Quinn Emanuel Urquhart & Sullivan are representing the defendants.
The case number is 26-BC01B-0034.
Cumberland Superior Court, North Carolina
North Carolina Settles PFAS Case with Chemical Makers for $590M
North Carolina’s attorney general, the state’s Department of Environmental Quality secretary and a Kelley Drye team secured a $590 million settlement with Chemours, DuPont and Corteva this month.
“We are incredibly proud to represent the State of North Carolina and to support Attorney General Jeff Jackson and his team in holding these companies accountable for decades of PFAS contamination that harmed communities across the Cape Fear region,” Houston-based William J. Jackson, a partner in Kelley Drye’s environmental practice group, said in a news release.
The settlement resolves litigation brought by the state and 11 local governments against Chemours, DuPont and their affiliates over decades of discharging PFAS “forever chemicals” into neighboring communities and the Cape Fear River, impacting the drinking water of over 500,000 North Carolinians. The settlement recovers $455 million in PFAS-treatment costs and natural resource damages and secures $135 million in financial assurance to stand behind the remediation obligations under a 2019 consent order.
“This settlement represents an important step forward in addressing the impacts of PFAS contamination and securing meaningful relief for affected communities. This settlement will help support efforts to address PFAS contamination and ensure that residents across southeastern North Carolina have access to clean, safe water,” Houston-based Kenny Corley, lead trial counsel on the matter, said in a news release.
Under the terms of the agreement, $455 million in guaranteed payments will be made to the state and local governments over the next 10 to 15 years, with $75 million allocated to the state, including roughly $55 million directed to an Emerging Contaminant Mitigation Fund recently created by the North Carolina General Assembly to support local efforts to detect and reduce contaminants in drinking water. The remaining $380 million will be divided among 11 affected local governments, including Bladen, Brunswick, Columbus, Cumberland, New Hanover, Robeson and Sampson Counties, the town of Wrightsville Beach, the city of Lumberton, the village of Bald Head Island and the Lower Cape Fear Water and Sewer Authority.
The settlement also establishes a $135 million reserve fund from DuPont and Corteva to support Chemours’ ongoing obligations under the 2019 consent order. The agreement reinforces NCDEQ’s enforcement of those obligations, which include measures to reduce PFAS discharges and migration, control air emissions, address contaminated groundwater and stormwater and provide clean drinking water to families with contaminated wells. The reserve fund will help ensure that families receiving clean drinking water continue to have access to it if Chemours is unable to meet its obligations.
Melissa Byroade, Laura Duncan, Levi Downing, Elizabeth Krasnow, David Zalman, Ivan Morales, Frances Morris, Lauren Shah, Nancy Yanochik, Curt Marshall, Fanny Turcios, Maria Pimienta of Kelley Drye also represented North Carolina. The North Carolina attorney general’s team was led by Asher Spiller, Laura Howard and Marc Bernstein.
Thomas Segars, James Weiss and Scottie Lee of Ellis & Winters represented Chemours and DuPont.
The case number is 436A21-2.
Craving more Texas Lawbook litigation coverage? Don’t worry, we’ve got you covered. Take a look at these stories you may have missed in the past few days.
After a nearly weeklong trial, a Marshall jury found a group of Chinese tech companies owe $27 million for infringing four patents related to creating and selling 3D printers. U.S. District Judge Rodney Gilstrap presided over the trial.
A fight between two former business partners who together made tens of millions of dollars building a futures prop firm in Austin before the relationship soured and spilled into separate fights in state and federal court in Texas recently ended in rare fashion. The plaintiff, Leo Riot, who had accused his former partners at Apex Trader Funding of defrauding him, breaching contracts and misappropriating his intellectual property, issued a public statement in August conceding none of his claims were true.
A Fort Worth jury found Trinity Valley School liable for defamation and retaliation and awarded its former human resources director more than $10 million in damages earlier this month. Carrie Skains sued her former employer in December 2024 for sex discrimination, retaliation and defamatory statements that claimed she kept information about a teacher who exposed himself to children in order to protect him.
The appeal to the Texas Supreme Court comes about a month after the Fifth Court of Appeals in Dallas determined the ecclesiastical abstention doctrine required the dismissal of nearly all the claims Cindy Clemishire brought against Robert Morris, Gateway Church and three of its elders. Clemishire argued that ruling transformed the doctrine from “a tool of qualified restraint to a totalizing shield that leaves churches immune from judicial oversight.”