SmartDisk, a deposition video and production company that started in Houston more than 20 years ago, was vindicated by a panel of Texas Business Court jurors Tuesday afternoon when they agreed a former business partner owes the company about $6.4 million in damages for breach of an agreement.
The panel of 12 heard opening statements in the lawsuit against Lexitas Sept. 1, and, after hearing closing arguments Tuesday, began deliberating around noon. Just before 4:30 p.m., after submitting two questions to the court, they reached a 10-2 verdict.
The jury had two versions of events to pick from.
SmartDisk argued that after Lexitas, which specialized in court reporting services, was sold by one private equity company to another in November 2019, it began systematically breaching a 2016 agreement between the parties. Under the agreement, SmartDisk was to be the “exclusive provider of video production and finishing services” to Lexitas in Texas.
In April 2025, SmartDisk sued for breach of contract and fraud, seeking about $3.4 million in damages for work that should have been sent to it but was instead routed to a company in Missouri and another $3 million for what it said was the routine underpayment of invoices.
Lexitas told a very different story. It maintained throughout the trial that the sale of the company by Trinity Hunt Financial to APAX Partners in November 2019 constituted the termination of the agreement under a specific provision titled “sale of/change of control of company.” Alternatively, Lexitas told jurors, if they did not believe the agreement terminated, they should still find no damages are owed to SmartDisk because work that previously went to SmartDisk was instead handled in-house, not by another vendor, meaning it complied with the agreement.
The jury, which heard in closing arguments that SmartDisk’s lawyers took the case on contingency, awarded every penny of damages requested, including about $3 million in attorney fees and $230,000 in conditional appellate fees.
“I think that private equity does some good things, but it has the potential to do a lot of bad things,” SmartDisk’s lawyer, John Zavitsanos, told The Lawbook after the verdict Tuesday. “It’s destroyed a lot of jobs. It’s destroyed a lot of businesses. It’s this get-rich-quick, get-in-get-out, without regard for the consequences of what happens.”
His client, Peter Keierleber, who co-owns SmartDisk, was standing beside him as he spoke in the hallway outside the courtroom.
“This man and his partner literally spent the better part of 35 years of their life … building this business, and when it got to a point where they weren’t needed anymore, they got kicked to the curb,” Zavitsanos said.
He said he believed that story resonated with the jury and said the verdict is “a testament to the fact that old-fashioned Texas values still do exist.”
Counsel for Lexitas declined to comment Tuesday after the verdict.
During closing arguments Tuesday morning, Lexitas’ lawyer, Robert Shwarts of Orrick, started out by adapting a quote from The Godfather.
“This case is nothing personal,” he said. “It’s strictly business.”
He told jurors SmartDisk’s business “was going to be sold or was going to go away due to market forces.” And the driving force behind this lawsuit, he said, was that SmartDisk tried and failed multiple times to get Lexitas to acquire its business.
“His business became obsolete,” he said. “So whatever you think, Lexitas was not responsible for whatever happened to his business. His business was going to fail because of the market forces.”
During rebuttal time, Zavitsanos hit back against an argument from opposing counsel that his firm wasn’t entitled to all the fees it was seeking for work done on the case. He made a comment about the rates charged by opposing counsel, which drew an objection.
“I’m not trying to act humble here, because I’m not,” he said. “But every once in a while, you meet someone who gets totally screwed over, and they need someone. And so we took a flier on him,” he said, referencing the contingency fee arrangement and urging jurors to award fees for the work done representing SmartDisk. “They’ve got high price, world-class lawyers on their side. That’s what private equity can buy.”
The jury asked its first question around 3:05 p.m., seeking clarification of the significance of one of the dates included in one of the questions on damages. The court returned a blunt answer in response: “Just answer the question.”
At 3:25 p.m., another single buzz could be heard in the courtroom. This time, jurors asked whether the dollar amounts for damages mentioned during trial were “firm or suggested.” They received another no-nonsense answer: “Follow the charge and answer the question.”
About an hour later, the jury buzzed twice, indicating a verdict had been reached.
Judge Grant Dorfman presided over the case but had to be out of town when deliberations began Tuesday. He tapped Justice Randy Wilson of the Fourteenth Court of Appeals, who was a state district judge in Houston for 15 years, to preside from there.
SmartDisk is also represented by Jason McManis, Matt Davis, Savannah Ezelle, David Warden and Kelsi White of Ahmad Zavitsanos & Mensing.
Lexitas is also represented by Ryan Wooten, Andraya Flor, Michael Morehead, Tom Panighetti and Jeff Quilici of Orrick.
The case number is 25-BC11B-0022.