In this edition of Litigation Roundup, the University of Texas settles a gender discrimination lawsuit with the law professor Linda Mullenix, Amazon draws a patent infringement lawsuit over robotics used at its fulfillment centers, the Fifth Circuit denies a bid from a fraudster — who waived his right to appeal — to challenge his 14-year sentence and a settlement is reached in a shareholder lawsuit against Fluor Corporation.
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Harris County District Court
CenterPoint Settles Worker’s Electrocution Suit
A confidential settlement has been reached between CenterPoint Energy and a union-backed electrical contractor who suffered life-changing injuries after receiving an electric shock on the job.
Brett Middleton was an employee of North Houston Pole Line when he was contracted to perform maintenance work at a substation operated by CenterPoint Energy. He was injured in February 2019 when the piece of equipment he was tasked with working on — which had not been deenergized — caused Middleton to suffer an electric shock.
Middleton had to have his left arm amputated and suffered other injuries including burns to his body and trauma to his spine and head. Joe Fisher of Provost Umphrey, who represents Middleton, said in a news release that the incident never should have happened.
“There was no reason for any equipment to be energized near where Mr. Middleton was working,” he said. “This accident was 100 percent preventable and now our client must live with his injuries for the rest of his life.”
The case that was assigned to Judge Kristen Hawkins had been set for a Nov. 21 trial.
CenterPoint is represented by J. Parker Fauntleroy Jr., T. Marshall Holmes and Mitchell R. Powell of Cokinos Young.
Middleton is also represented by Ed Fisher of Provost Umphrey and John Eddie Williams Jr. and Jim Hart of Williams Hart Boundas.
The case number is 2019-29215.
Western District of Texas
UT Settles Lawsuit with Class Action Law Professor
University of Texas School of Law professor Linda Mullenix sued the university in December 2019 claiming that she was paid $134,000 less than her colleague who teaches the same subject and has comparable experience. The lawsuit, brought under the Equal Pay Act, survived motions to dismiss and was headed for trial.
On Nov. 9, UT and lawyers for Mullenix filed a joint motion in the Western District of Texas asking U.S. District Judge David Ezra to dismiss the litigation stating that the “parties have resolved this dispute.”
The terms of the settlement are undisclosed.
Lawyers for Mullenix are Colin Walsh and Jairo Castellanos of Wiley Walsh in Austin, and Paige Melendez and Rob Wiley in Dallas.
Darren Gibson, Kellie Fuqua and Andrew Gray of Littler Mendelson of Austin represented the University of Texas.
The case is Linda Susan Mullenix v. University of Texas at Austin, WDTX, No. 1:19-cv-01203.
Northern District of Texas
Fluor Settles Shareholder Dispute
U.S. District Judge Brantley Starr last week approved a $33 million class action settlement between Irving-based Fluor Corp. and company investors over allegedly misleading statements by Fluor officials made between 2013 and 2020. But Judge Starr declined to approve the proposed fees paid to plaintiffs’ lawyers in the case.
Investors sued Fluor in 2018 claiming that company officials misled them about the costs of projects and whether certain projects were being completed on time. The case is Kin-Yip Chen vs. Fluor Corp.
Judge Starr called the settlement agreement fair, but he declined to immediately approve the request of the plaintiffs’ attorneys to be paid a 30 percent contingency fee, or $9.9 million. He told the lawyers to provide more information.
Chen is represented by Brian P. Lauten and Laurie G. Flood of Brian Lauten, P.C. Fairfield Employees Retirement Plan and Fairfield Police and Firemans Retirement Plan are represented by Darryl J. Alvarado, Ellen Gusikoff Stewart, Joseph Marco Janoski Gray and Kevin S. Sciarani of Robbins Geller Rudman & Dowd; J. Alexander Hood II, Jennifer B. Sobers, Jeremy Alan Lieberman, Matthew L. Tuccillo and Patrick Dahlstrom of Pomerantz; and Willie Briscoe of The Briscoe Law Firm.
The case number is 3:18-cv-01338.
Eastern District of Texas
Amazon Draws Patent Infringement Suit Over Fulfillment Center Tech
Amazon was hit with a federal lawsuit Nov. 7, alleging that the technology the company uses at fulfillment centers infringes three patents held by LightGuide Inc., a company that makes augmented reality software.
According to the lawsuit, the patents at issue are for systems and methods that use digital projection technology to overlay step-by-step instructions onto any work surface “to deliver immersive, interactive visual work instructions that simplify, standardize, improve, and monitor operational tasks that comprise a company’s key material handling, fulfillment, assembly, inspection, and training operations.”
LightGuide told the court that its ability to display work instructions in an “immersive, intuitive and illuminating” way, rather than having employees view those instructions on a monitor or in a paper-filled binder, results in cost savings and increased revenue generation.
Its customers include Ford Motor, General Electric, and many other Fortune 100 and Fortune 500 companies.
LightGuide alleges Amazon repeatedly engaged it in discussions about the technology starting in September 2016 “under the guise of entering into a long-term business relationship” but was actually “secretly copying LightGuide’s patented technology and working to incorporate it into at least Amazon’s fulfillment centers,” according to the lawsuit.
The lawsuit was assigned to U.S. District Judge Robert W. Schroeder III.
LightGuide is represented by Matthew R. Berry, Andres Healy and John E. Schlitz of Susman Godfrey and T. John Ward Jr., Claire Abernathy Henry, Andrea L. Fair and Garrett Parish of Ward Smith & Hill.
Counsel information for Amazon is not yet available.
The case number is 2:22-cv-00433.
Fifth Court of Appeals
Southwest Airlines Pilots Union Gets Another Shot in 737 Max Suit
The thousands of Southwest Airlines pilots alleging the grounding of 737 Max airplanes cost them millions because of canceled flights will have another chance to bring their lawsuit against The Boeing Company after an appellate panel unanimously revived the claims.
The Nov. 7 ruling rejected an argument from the 8,794-member union that Boeing had busted the deadline to file a motion to dismiss in the trial court but agreed that the trial court should not have granted the dismissal motion.
Boeing had moved to dismiss the lawsuit under res judicata, arguing the suit was foreclosed because the issue had already been litigated in a 2019 suit. The appellate panel held that while the union did allege this suit and the 2019 lawsuit were “related,” the filing “does not show the 2021 suit was based on the same claims that were raised or could have been raised in the 2019 action.”
Justices Lana Myers, Bill Pedersen III and Dennise Garcia sat on the panel.
Boeing is represented by Nina Cortell and Christopher R. Knight of Haynes and Boone, Anne Johnson and Kelli Bills of Tillotson Johnson & Patton, E. Leon Carter and Courtney Barksdale Perez of Carter Arnett and Craig S. Primis and Ronald K. Anguas Jr. of Kirkland & Ellis.
The case number is 05-21-00598-CV.
Thirteenth Court of Appeals
State’s Main Business Tax Survives Another Challenge
A Texas intermediate appeals court has concluded that the franchise tax is not an occupation tax, rejecting Swift Transportation Co. of Arizona, which argued that a legislative exemption for motor carriers from “any occupation tax measured by gross receipts” must include an exemption from franchise taxes.
The state argued that the franchise tax is not an occupation tax because it is levied on all businesses generally and is measured by “taxable margin,” not gross receipts.
The Thirteenth Court of Appeals agreed with the state, finding that the franchise tax and occupation tax each classify the businesses subject to their taxes differently.
“For example, whether a business is subject to the franchise tax depends on which entity the business chooses,” said Justice Clarissa Silva. “On the other hand, occupation taxes are classified by occupation and entity, regardless of the entity chosen.”
Justices Nora Longoria and Leticia Hinojosa sat on the panel with Silva.
The franchise tax has survived previous challenges over whether it violated the Texas Constitution’s requirement that taxes be equal and uniform and whether it functioned as a personal income tax on limited partnerships.
Swift initiated administrative proceedings with the comptroller, seeking a tax refund for reporting years 2014 through 2016. Swift sued the state in district court after losing its administrative hearing. A Travis County trial court found for the state and disposed of the case. Swift’s appeal was transferred from the Third Court of Appeals in Austin through a docket equalization order.
Swift was represented by Doug Sigel and Rich Moore of Ryan Law Firm. The comptroller was represented by the Office of Attorney General Ken Paxton, including Assistant Attorney General Quinn T. Ryan.
The case number is 13-21-00010-CV.
U.S. Court of Appeals for the Fifth Circuit
No, Waiver Really Means Waiver
A man who waived his right to appeal when entering a plea agreement with the government for orchestrating a $7 million investment scam really did waive his right to appeal, a panel of judges held in an opinion issued Nov. 9.
Christopher Matthew Meredith — who pleaded guilty to one count of securities fraud, was sentenced to 14 years in prison and ordered to pay $6.8 million in restitution — had argued he didn’t “really waive his right to appeal ‘on any ground’ and did not really waive his right to appeal the district court’s determination of any ‘monetary penalty or obligation,’” the court wrote.
“How so, you might wonder? Meredith points out that the plea agreement, like all or virtually all such agreements executed by the Justice Department, carves out the right to appeal if the district court’s sentence exceeds ‘the maximum sentence authorized by statute,’” the court wrote. “We long ago rejected such an attempt to use the statutory-maximum boilerplate as an appeal-authorizing escape hatch.”
Meredith argued on appeal that there were errors both in the calculation of restitution he owes and in the application of an enhancement to his sentence. The Fifth Circuit panel was unmoved, writing that Meredith “agreed to let the district court handle the arithmetic” and “cannot now complain about how the numbers shook out.”
The government had alleged Meredith, a Kansas resident, solicited investors for his company, Strategic Pharma Inc., by lying to dozens of retirees about the business dealings his company supposedly had with the Department of Veteran Affairs and Biopharma Services Inc. to induce their investments.
U.S. District Judge Robert Pitman sentenced Meredith on June 3, 2021, according to court records, and Meredith filed notice of appeal June 9, 2021.
Judges Andrew S. Oldham, Don R. Willett and Carl E. Stewart sat on the panel.
The government is represented by Joseph H. Gay Jr. and Elizabeth Berenguer of the U.S. Attorney’s Office for the Western District of Texas.
Meredith is represented by federal public defenders Kristin L. Davidson and Maureen Scott Franco.
The case number is 21-50487.
Editor’s Note: Janet Elliott and Mark Curriden contributed to this report.