In this edition of Litigation Roundup, Samsung beats back a patent suit seeking half a billion dollars in damages after arguing the plaintiff had unclean hands, a jury in Marshall renders a $445 million infringement verdict and we detail what led American Airlines to replace Wilson Elser as its outside counsel in a lawsuit involving a bathroom recording of a 9-year-old girl.
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Travis County District Court
American Airlines Replaces Wilson Elser in Bathroom Recording Suit
American Airlines has replaced law firm Wilson Elser Moskowitz Edelman & Dicker after its lawyers placed blame on a 9-year-old girl who was filmed going to the bathroom onboard a flight in response to her family’s lawsuit.
The case docket in Travis County’s 261st District Court shows American Airlines filed a motion for withdrawal and substitution of counsel on Friday after the airline company came under scrutiny for the defense filing earlier in the week.
According to the document, American Airlines was represented by Coleman Proctor, Patrick Kearns, Kathryn Grace, Kevin Littlejohn and Sarena Kustic of Wilson Elser. They did not respond to The Texas Lawbook’s request for comment.
The airline requested to replace the legal team with Shauna Wright, Meredith Knudsen and Marylynn Smitherman of Kelly, Hart & Hallman.
“As a result of the intense media and public backlash surrounding the outrageous allegation, we are not surprised to learn that American Airlines fired its law firm,” said Paul Llewellyn, a lawyer with Lewis & Llewellyn who is representing the plaintiffs, in a statement to The Lawbook. “With the benefit of this new legal representation, we hope that American Airlines will now take a fresh look at the case and finally take some measure of responsibility for what happened to our client. Otherwise, we are very confident that a Texas jury will do the right thing and hold American Airlines responsible.”
The 9-year-old girl’s family is one of several plaintiffs who filed lawsuits against the airline accusing ex-flight attendant Estes Carter Thompson III of secretly filming people in the lavatories. Thompson is charged in federal court with attempted sexual exploitation of children and possession of child pornography depicting a prepubescent minor.
According to the lawsuit brought by the 9-year-old girl’s family, the FBI contacted them a year after she flew from Austin to Los Angeles in January 2023 to inform them images of the girl had been found on Thompson’s iCloud account. The family accuses American Airlines of negligence.
American Airlines’ May 20 answer to plaintiff’s amended petition argued, among other defenses, the claims “are barred by the doctrine of comparative negligence, contributory negligence, comparative responsibility and/or comparative causation.”
“Defendant would show that any injuries or illnesses alleged to have been sustained by Plaintiff, Mary Doe, were proximately caused by Plaintiff’s own fault and negligence, were proximately caused by Plaintiff’s use of the compromised lavatory, which she knew or should have known contained a visible and illuminated recording device,” the filing signed by Wilson Elser lawyers states.
American later issued a statement disavowing the filing and said “outside legal counsel retained with our insurance company” erred in filing the defense.
“The included defense is not representative of our airline and we have directed it be amended on May 22,” the airline said. “We do not believe this child is at fault and we take the allegations involving a former team member very seriously.”
An amended answer to the lawsuit without the controversial defense was filed May 22 by the same Wilson Elser lawyers, court records show.
Plaintiffs are also represented by Dallas lawyer E. Leon Carter of Carter Arnett.
The case number is D-1-GN-24-000786.
Harris County District Court
Advantek Sued Over Fatal Explosion
A worker who was among those injured when a fatal explosion took place at a saltwater disposal plant has filed a lawsuit against the facility owner and the owner of a truck that was involved in the incident.
Bryant Bennett filed the lawsuit May 22 against Advantek Eagleford, Advantek Waste Management Services and Drillwell. Bennett alleges that while he was working at the Advantek facility in Westhoff, Texas, (about 75 miles east of San Antonio) when the driver of a Drillwell truck that was parked adjacent to flammable waste tanks lifted the hood of his truck.
Bennett said he “immediately felt an explosion” after that. One worker was killed in the explosion, and several others were injured.
The case has been assigned to Harris County District Judge Tanya Garrison, who has scheduled a hearing on a motion for temporary injunction June 3.
Bennett is seeking more than $1 million in damages.
Bennett is represented by Muhammad Aziz and Edward P. Keenan of Abraham, Watkins, Nichols, Agosto, Aziz & Stogner and Giovanni Padilla and Adrian Zuniga of Z&P Law Group.
Counsel information for Advantek wasn’t available Monday.
The case number is 2024-32525.
Eastern District of Texas
Samsung Beats Back Patent Suit with Unclean Hands Defense
Samsung Electronics Co. and Samsung Electronics America recently defeated a lawsuit brought by Staton Techiya and Synergy IP Corporation accusing it of infringing 14 patents after the court agreed unclean hands rendered the patents unenforceable.
U.S. District Judge Rodney Gilstrap issued the 118-page findings of fact and conclusions of law in favor of Samsung on May 9; a redacted version of the document was uploaded to PACER on May 24. The ruling was issued following a bench trial that took place before U.S. Magistrate Judge Roy Payne on March 26 and March 27.
Techiya and Samsung’s former in-house counsel had alleged that Samsung’s Bixby AI feature and its mobile phones infringed various patents held by Techiya.
“Evidence presented by the parties at the bench trial demonstrates subversion of our adversarial system of litigation and an invasion of the attorney-client privilege,” Judge Gilstrap wrote. “The clear and convincing weight of the evidence shows that the patent claims underlying this litigation are infected by the theft of Samsung’s sensitive confidential and attorney-client privileged information. This theft was enabled by Techiya’s engagement with its litigation-agent, Synergy — in particular with former Samsung IP Center Head Dr. Seungho Ahn and former Samsung in-house IP attorney Mr. Sungil Cho.”
Judge Gilstrap went on to explain that Synergy “improperly acquired Samsung’s privileged information” and leveraged that along with inside knowledge of how Samsung handles intellectual property disputes in order to gain an advantage in litigation.
“The clear and convincing evidence establishes that, with respect to this litigation, Synergy’s hands are unclean,” Judge Gilstrap wrote in dismissing the lawsuit with prejudice. “The evidence further shows that Synergy acted as Techiya’s agent in this litigation, and that Synergy’s unclean hands are imputable to Techiya.”
Staton and Techniya filed suit against Samsung in November 2021, according to court records, seeking half a billion dollars in damages. In response to the allegations of unclean hands, Techiya had argued at trial that it didn’t know about Synergy’s misconduct and shouldn’t be held responsible for it, that Synergy wasn’t its “agent” and that Samsung should have notified it directly “that it objected to Dr. Ahn representing Techiya.”
“On all three of these critical issues for Techiya’s defense, Techiya’s witnesses were not credible because their trial testimony flatly contradicted their prior testimony and their own documents,” Judge Gilstrap wrote.
Samsung is represented by Melissa R. Smith, Andrew Gorham and James Underwood of Gillam & Smith and a large team of lawyers from Kirkland & Ellis, led by Gregory S. Arovas, Todd M. Friedman, Alex R. Henriques and Peter J. Evangelatos in New York.
Staton Techiya and Synergy IP are represented by Melissa C. Pallett-Vasquez and Matthew Tieman of Bilzin Sumberg Baena Price & Axelrod, Jennifer Truelove of McKool Smith and several attorneys from PV Law in Washington, D.C., and Bunsow De Mory in Redwood City, California.
The case number is 2:21-cv-00413.
Jury Hands Netlist $445M Win in Patent Case
A jury in Marshall recently determined that Netlist is entitled to $445 million in damages from Micron Technology for infringing two patents covering computer memory technology.
U.S. District Judge Rodney Gilstrap presided over the trial that ended May 23. Netlist filed suit in June 2022. This jury verdict comes weeks after Netlist notched a $303 million victory against Samsung in the Eastern District of Texas in another trial involving patents covering computer memory technology.
Micron is represented by Thomas M. Melsheimer, Natalie Arbaugh, Rex A. Mann, Michael Rueckheim, David P. Enzminger, Ryuk Park and Matthew R. McCullough of Winston & Strawn and Wesley Hill, Andrea Fair and Charles Everingham IV of Ward, Smith & Hill.
Netlist is represented by Jason Sheasby, Annita Zhong, Andrew J. Strabone, Yanan Zhao and Michael W. Tezyan of Irell & Manella and Jennifer Truelove and Samuel F. Baxter of McKool Smith.
The case number is 2:22-cv-00203.
Northern District of Texas
Energy Drink Co. Files Defamation Suit Against Boxer
Prime Hydration filed a lawsuit May 23 against professional boxer Ryan Garcia alleging his online statements that its energy drinks are harmful constitute defamation.
“Garcia has a history of stirring up controversy to promote his fights and personal brand, including by attacking other high-profile individuals and brands,” the lawsuit alleges. “Although Garcia at one time was on good terms with Prime, as Prime grew he decided to embark on a campaign of spreading lies about Prime, its hydration drink and one of Prime’s owners, Logan Paul.”
Garcia’s allegedly defamatory comments include claims that the drink poses health risks to liver and brain function, has caused seizures and contains “horrible chemicals,” according to the lawsuit.
“Not content with his fabrications about the contents of Prime’s products, Garcia smears Prime’s business and team,” the lawsuit alleges. “He falsely claims that Prime and its team ‘work for the devil,’ have ‘raped’ and ‘burned’ children, have an ‘agenda’ to ‘poison children’ and engage in ‘human trafficking’ — all while knowing that such wild accusations lack any modicum of support.”
Prime alleges Garcia telegraphed his intentions in a podcast interview, which are to “destroy Prime little by little” and create his own drink company.
Prime filed suit in Dallas, where Garcia lives and trains. The lawsuit seeks damages in excess of $75,000.
The case has been assigned to U.S. District Judge Sam A. Lindsay.
Counsel for Garcia had not filed an appearance as of Monday.
Prime Hydration is represented by Herbert Finn, Daniel P. Elms, Michael Burshteyn and Patrick Owens of Greenberg Traurig’s offices in Chicago, Dallas and San Francisco.
The case number is 3:24-cv-0120.
AA Plan Participants Get Class Cert in ESG Suit
U.S. District Judge Reed O’Connor on May 22 granted class certification to a group of beneficiary plaintiffs alleging American Airlines’ pursuit of environmental, social and governance goals damaged retirement plan participants.
The class of more than 100,000 people includes all participants and beneficiaries of the AA 401(k) plan between June 1, 2017, and the date of judgment in this case but excludes those who only invested via the plan’s self-directed brokerage account. The lawsuit accuses AA of violating the Employee Retirement Income Security Act in its pursuit of ESG goals when it gave fund managers like BlackRock plan assets. Those fund managers, the suit alleges, “ignored financial returns as the exclusive purpose and lowered the value of plan participants’ investments.”
The suit seeks injunctive relief that would bar AA’s “ESG activism” moving forward.
“While defendants may be correct that individual class members suffered diverse impacts in the form of damages, this potential difference does not erase the fact that all class members allegedly suffered the same core injury,” Judge O’Connor wrote. “At bottom, plaintiff’s primary contention is that the systemic presence of ESG activism in the plan — be it the disloyal pursuit of defendants’ own ESG goals or imprudently allowing ESG-focused managers to handle investments — harmed plan participants and beneficiaries.”
American Airlines is represented by Russell D. Cawyer and Dee J. Kelly Jr. of Kelly Hart & Hallman and Shannon Barrett, Brian D. Boyle, Jeffrey A. N. Kopczynski, William Pollak, Charles Mahoney and Mark W. Robertson of O’Melveny & Myers.
The plaintiffs are represented by Andrew Stephens and Heather Hacker of Hacker Stephens and Isaac Diel, Hammons P. Hepner, Nathan A. Kakazu and Rex A. Sharp of Sharp Law.
The case number is 4:23-cv-00552.
Third Court of Appeals
ProPublica, Texas Tribune Get Defamation Suit Tossed
MRG Medical cannot proceed with its lawsuit accusing two media outlets and three reporters of business disparagement stemming from an article published during the Covid-19 pandemic, a three-justice panel recently determined after finding the company waited too long to bring suit.
A one-year statute of limitations applies to the claims MRG Medical lodged in 2022 against ProPublica, The Texas Tribune and reporters Vianna Davila, Jeremy Schwartz and Lexi Churchill, Justice Rosa Lopez Theofanis explained in the May 22 opinion, writing for the unanimous panel.
The lawsuit was filed in response to an article the media entities jointly published on Sept. 25, 2020, titled “How a local Texas politician helped a serial entrepreneur use COVID-19 to boost his business.”
MRG Medical and its CEO Kyle Hayungs identified four statements in that article that became the basis of the lawsuit alleging business disparagement, tortious interference and civil conspiracy. In addition to raising the limitations argument, the media defendants also argued that the lawsuit should be dismissed under the Texas Citizens Participation Act because it was brought in an attempt to chill its free speech rights.
The trial court denied the TCPA motion to dismiss, prompting the appeal. The appellate court did not reach the issue of whether the TCPA applies.
Chief Justice Darlene Byrne and Justice Chari L. Kelly also sat on the panel.
The media companies and reporters are represented by Marc Fuller, Maggie Burreson and Joshua Romero of Jackson Walker.
MRG Medical is represented by Emerson Arellano and Jonathan L. Almanza of Edinburg, Texas.
The case number is 03-23-00293-CV.
Texas Supreme Court
USAA Won’t Face Class Action in Salvage Vehicle Suit
The Texas Supreme Court unanimously determined Friday that a Dallas County district judge and a panel of justices from the Fifth Court of Appeals had wrongly certified a class action lawsuit that would have allowed a group of USAA insurance claimants to proceed with their challenge to USAA’s practice of declaring vehicles a “total loss.”
Sunny Letot, the would-be class representative, filed suit after USAA declared her vintage 1983 Mercedes-Benz 300SD a total loss after another driver rear ended her. Letot alleged that USAA’s uniform practice of declaring vehicles salvage, which renders them undriveable and unsellable under state law, unlawfully deprived her of the use of her car for two years while she fought the determination.
Justice Evan Young, writing for the court, explained Letot can still proceed with her individual claim against USAA.
“Telling a jury to resolve all class members’ claims based on a trial that focused on Letot’s unusual attachment to a special car, in which USAA unusually reversed itself by filing a correction request, would create a windfall for all the other class members,” Justice Young wrote. “None of them would object to being represented by someone like Letot. But it would be deeply unfair to USAA in a class context precisely because Letot’s individual experience is so atypical. We reiterate that, to the extent her claims have merit, they are perfectly suited for an individual trial, which is how she should proceed. “
USAA is represented by Rachel Ekery, Wallace B. Jefferson and Marcy Hogan Greer of Alexander Dubose & Jefferson and Robert T. Owen and Levon G. Hovnatanian of Martin, Disiere, Jefferson & Wisdom.
Letot is represented by Anne Johnson, Jeffrey M. Tillotson, J. Austen Irrobali and Stephani A. Michel of Tillotson Johnson & Patton.
The case number is 22-0238.
Editor’s Note: Krista Torralva contributed to this report.