In this edition of Litigation Roundup, a $100 million defamation lawsuit against Marriott gets rolling, Dell Technologies gets a win in a $450 million patent infringement lawsuit and the Fifth Circuit agrees Landry’s is on the hook for data breach damages.
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Eastern District of Texas
Marriott, Irvin Lawyer Up in $100M Lawsuit
Former Dallas Cowboys wide receiver Michael Irvin, who is suing Marriott International for defamation and tortious interference after he was accused of inappropriate conduct and kicked out of the hotel, has hired a team of lawyers from McCathern to pursue the claims.
Levi McCathern, Jesse Cromwell, Noah McCathern and Scott J. Becker will face off against Marriott’s legal team — C. Celeste Creswell and Nathan Chapman from Kabat Chapman & Ozmer; Tyler Frankel of Clark Hill Strasburger and Kendall Hayden of Cozen O’Connor — in the lawsuit that was removed to federal court from Collin County district court Feb. 20.
In the week leading up to the Super Bowl, Irvin was forced to leave his Phoenix hotel room after what he describes in the lawsuit as an “innocent and brief” interaction with a waitress in the lobby. He took the elevator to his room alone following their interaction but was “roused the next morning by the hotel’s private security force attempting to remove him from the hotel without explanation.”
Irvin said in the lawsuit that his ouster from the hotel under allegations of inappropriate conduct damaged his reputation, his relationship with the NFL — which removed him from all scheduled Super Bowl-related programming — and has interfered with “high-profile endorsements, appearances and other contracts.”
The case has been assigned to U.S. District Judge Amos L. Mazzant III, who has given Marriott until Tuesday to respond to Irvin’s request to expedite discovery.
The case number is 4:23-cv-00131.
Western District of Texas
Judge Albright Ends $450M Patent Suit Mid-Trial
Patent-holding entity WSOU Investments didn’t get to have a jury decide whether its roughly $450 million infringement lawsuit against Dell Technologies and VMware Inc. was valid because U.S. District Judge Alan Albright granted the companies a directed verdict soon after WSOU rested its case on Feb. 23.
WSOU filed suit in June 2020, court records show, alleging Dell and VMware infringed three patents it holds relating to cloud infrastructure networking technology. But at the close of the plaintiff’s case, Judge Albright agreed with arguments from attorneys for Dell and VMware that WSOU hadn’t presented enough evidence to get the case before the jury and granted a directed verdict ending the lawsuit.
Dell and VMWare are represented by Brian Rosenthal, Veronica Moyé, Benjamin Hershkowitz, Ernest Hsin, Jaysen Chung, Casey McCracken and Blaine Evanson of Gibson Dunn and Barry Shelton of Winston & Strawn.
WSOU is represented by Jon Waldrop, Darcy L. Jones, Marcus A. Barber, Keather S. Kim, John W. Downing, ThucMinh Nguyen and Chen Jia of Kasowitz Benson Torres
The case number is 6:20-cv-00480.
Thirteenth Court of Appeals
UTRGV Must Face Age Discrimination Suit
In a ruling issued Feb. 23, an appellate panel determined that Cameron County District Court Judge Gabriela Garcia was correct in allowing fired grant proposal writer Paul Kavanaugh to proceed with his age discrimination lawsuit against the University of Texas Rio Grande Valley.
Kavanaugh was laid off in March 2019 at age 64 under the university’s reduction in force policy — which gives priority consideration to affected employees who apply for a vacancy within six months of their termination. Kavanaugh alleges he was wrongly passed over for a different grant writer position the university posted in September 2019 despite his superior qualifications when it instead hired 26-year-old Eslibeth Perez.
The appellate justices wrote that Kavanaugh had more years of experience than Perez and had secured grants for $2.5 million, $1 million and several other six-figure awards, while the largest grant secured by Perez was $120,000.
“This evidence is specific and comparative. And, in the parlance of the Fifth Circuit, the disparity between Kavanaugh and Perez ‘jump[s] off the page and slap[s] you in the face,’” the panel held. “Although any one of the above facts in isolation may be insufficient to raise a fact issue, viewing them collectively in the light most favorable to Kavanaugh, we agree with the trial court that a genuine issue of material fact exists as to whether Kavanaugh was clearly better qualified than Perez for the position.”
Justices Gina M. Benavides, Jaime E. Tijerina and Lionel Aron Peña Jr. sat on the panel.
UTRGV is represented by Jason T. Contreras of the state attorney general’s office.
Kavanaugh is represented by Analisa Figueroa of Brownsville.
The case number is 13-22-00351-CV.
Texas Supreme Court
Justices to Hear Case Over Attorney’s Theft, Abscondence
In a list of orders issued Friday morning, the Texas Supreme Court agreed to hear oral arguments in a lawsuit that asks it to determine who’s liable when an attorney to one party in a settlement agreement steals and absconds with disputed funds that were placed in an account.
Mark Boozer, Jerrod Raymond and Corporate Tax Management Inc., now known as RY Fischer & Associates, had sought court declarations that they complied with an April 2011 settlement agreement that resolved a lawsuit between them and Ray Fischer stemming from the sale of Fischer’s tax-consulting business.
The settlement agreement created an escrow account to hold disputed funds totaling about $1 million, and the parties decided the attorney for Boozer and Raymond, T. Wesley Holmes, would hold the funds while part of the judgment was on appeal.
The parties discovered in 2016, after the court ruled in favor of Fischer, that Holmes had stolen the escrow funds, prompting Fischer to threaten suit and Boozer and Raymond to seek a declaration they weren’t liable for the theft. Fischer counterclaimed for breach of contract and a trial court sided with Boozer and Raymond.
The Second Court of Appeals reversed and sided with Fischer, holding in part that the parties had not created an escrow account through the settlement agreement because the disputed funds weren’t deposited with a neutral third party as case law requires.
Oral arguments are scheduled for March 22.
Boozer and Raymond are represented by David E. Keltner and Jody Sanders of Kelly Hart & Hallman; Robert J. Myers and John J. Shaw of Myers & Shaw and Scott C. Faciane of The Faciane Law Firm.
Fischer is represented by C. Gregory Shamoun and Kenneth J. Lambert of Shamoun & Norman.
The case number is 22-0050.
U.S. Court of Appeals for the Fifth Circuit
Landry’s Can’t Duck Data Breach Damages
In a lawsuit over a credit card data breach that affected about 180,000 cardholders, an appellate panel recently upheld a district judge’s ruling that Landry’s, which owns the hotels, casinos and restaurants where hackers installed malware to facilitate the breaches, is on the hook for the damages.
The ruling issued Feb. 23 stems from a 2014 breach that targeted Landry’s-owned businesses. In the wake of the breach, Visa and Mastercard imposed more than $20 million in assessments against JPMorgan Chase and Paymentech, companies that were responsible for securely processing card purchases at Landry’s. In turn, Chase sued Landry’s seeking indemnification, and Landry’s then sued Visa and Mastercard.
U.S. District Judge Lynn Hughes tossed Landry’s third-party complaints against Visa and Mastercard and granted Chase summary judgment based on its contract with Landry’s that required Landry’s to indemnify Chase.
The appellate court upheld that ruling.
“Landry’s compares itself to an insurer, arguing that if it must indemnify Chase, then it should be able ‘to recover the losses that Chase sustained by reason of the wrongful conduct of [Visa and Mastercard],’” the panel wrote. “The wrongful conduct Landry’s alleges for all its subrogated claims is [Visa and Mastercard’s] levying of ‘illegal assessments’ on Chase. Landry’s analogy falls short for one overarching reason: Landry’s paid its own debt, not [Visa and Mastercard’s] debt.”
Judges Stuart Kyle Duncan, Patrick E. Higginbotham and Kurt D. Engelhardt sat on the panel.
Landry’s is represented by Constance Pfeiffer, Shayna M. Goldblatt, Andrew Ingram, Reagan Simpson and Christian J. Ward of Yetter Coleman and Murray Fogler and Michelle Gray of Fogler Brar O’Neil & Gray.
Mastercard International is represented by Martin S. Hyman and Matthew C. Daly of Golenbock Eiseman Assor Bell & Peskoe and Stephen Pate of Cozen O’Connor.
Visa is represented by Elizabeth Kiernan, Allyson Ho, Andrew LeGrand and Katherine Montoya of Gibson Dunn & Crutcher.
JPMorgan and Paymentech are represented by David Salmons, Michelle Chiu and David Levy of Morgan Lewis & Bockius.
The case number is 21-20447.
Court Denies Rehearing in Jailed Ex-Councilwoman’s Retaliation Suit
Judge James Ho authored a 13-page dissent on Feb. 22 after a majority of the court’s judges denied a petition for rehearing that former Castle Hills city councilwoman Sylvia Gonzales had filed after a divided panel ended her lawsuit in late June.
Over the summer, the court ruled 2-1 that Gonzalez’s suit against the police chief and former mayor of Castle Hills — an enclave of San Antonio with a population of about 5,000 — alleging she was arrested in retaliation for circulating a petition to remove the city manager fails because she didn’t “establish a violation of her constitutional rights.”
Judge Ho wrote that the “opportunity for public officials to weaponize the criminal justice system against their political adversaries has never been greater” and urged the judiciary to “make sure that those who hold positions of power stay in their lane.”
“Courts must make certain that law enforcement officials exercise their significant coercive powers to combat crime — not to police political discourse,” he wrote. “Unfortunately, the panel majority failed to uphold these principles and instead granted qualified immunity to the defendants in this case.”
Gonzales was arrested following a contentious council meeting where the petition was introduced after the mayor, Edward Trevino, reported to the chief of police, John Siemens, that he wanted to have Gonzalez arrested for allegedly taking the petition without consent.
After the meeting, Trevino asked Gonzalez for the petition, and she allegedly found it in her binder of other materials and handed it to Trevino who said that she “probably picked it up by mistake.”
A Castle Hills police sergeant tasked by Siemens with investigating the alleged crime found no wrongdoing, so a “special investigator,” local lawyer Alex Wright, was directed to take over the investigation.
Wright found Gonzalez violated Texas Penal Code Section 37.10(a)(3) and (c)(1) by intentionally concealing, removing or otherwise impairing the “verity, legibility, or availability of a governmental record.”
Wright went about securing an arrest warrant for Gonzalez in an unusual way that bypassed any involvement from the district attorney’s office and ensured Gonzalez, then 72-years-old, would spend the night in jail rather than getting to post bond immediately.
The city officials are represented by Scott Michael Tschirhart and Lowell Frank Denton of Denton Navarro Rocha Bernal & Zech.
Gonzalez is represented by Institute for Justice attorneys Anya Bidwell, William Aronin and Patrick M. Jaicomo.
Judges Kurt D. Engelhardt, Rhesa H. Barksdale and Andrew S. Oldham sat on the panel for the Fifth Circuit.
The cause number is 21-50276.