In this edition of Litigation Roundup, the Texas Supreme Court determined SpaceX will not have to face a new trial in an auto crash case and the U.S. Supreme Court upholds a Texas law requiring visitors to pornographic websites verify their age.
There was also some news out of the Texas Attorney General’s Office, which announced that Solicitor General Aaron Nielson is leaving to become a tenured professor at the University of Texas School of Law. He will be replaced next month by William Peterson, who is currently a partner in the Houston office of Morgan, Lewis & Bockius.
In a news release, Attorney General Ken Paxton called Peterson “one of the most accomplished lawyers in the United States.”
“His clerkships with Justice Clarence Thomas and a Fifth Circuit judge, and experience co-chairing the appellate practice of one of the nation’s largest law firms have prepared him well for this role,” Paxton said. “For almost two years, Aaron has fought tooth and nail for Texas before the U.S. Supreme Court and the Texas Supreme Court in many of the state’s most important and complex disputes. Texas owes him a debt of gratitude for extraordinary service, and I am pleased that he will continue to serve the State as a law professor at the University of Texas’s law school.”
Peterson clerked for Fifth Circuit Judge Edith Jones and is a graduate of the California Institute of Technology and the University of Texas School of Law.
“I am honored to serve as Solicitor General of Texas,” Peterson said in a news release. “I deeply appreciate the opportunity and the confidence placed in me by Attorney General Paxton. Aaron Nielson has been an excellent Solicitor General for the people of Texas, and I look forward to continuing that work alongside the talented attorneys at the Office of the Attorney General.”
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.
Sixth Court of Appeals, Texarkana
Settlement Coming in $287M Samsung Case
Samsung Electronics and Dutch telecommunications company Koninklijke KPN N.V. recently told an appellate court that they had reached a binding mediated agreement that would fully resolve the case that had resulted in a $287 million jury verdict against Samsung.
Samsung had filed its notice of appeal July 30, seeking to overturn a Harrison County jury’s February 2024 verdict finding the company had breached its contract with Koninklijke. Koninklijke filed suit in September 2022, accusing Samsung of breaching the terms of a 2016 settlement agreement that included a license for certain patents.
After the verdict, Samsung filed suit in federal court, alleging it had been the victim of an “about face” because while Koninklijke had maintained it wasn’t suing Samsung for patent infringement, that was the basis of the massive verdict rendered against it.
Chief U.S. District Judge for the Eastern District of Texas Rodney Gilstrap issued an order April 24, 2024, remanding the lawsuit back to state court. In a report and recommendation issued by U.S. Magistrate Judge Roy S. Payne April 4, 2024, he wrote that “there is no credible argument that the breach of contract claim necessarily raises a patent law issue,” but that KPN’s unjust enrichment claim “comes closer.”
Samsung then appealed to the Sixth Court of Appeals. In a joint motion to stay filed June 18, the parties told the court they needed 50 days “to allow the parties to comply with their respective obligations, after which they will move to dismiss this appeal.”
Samsung is represented by Melissa R. Smith and Harry Lee “Gil” Gillam Jr. of Gillam & Smith, Neil P. Sirota, Paul A. Ragusa, Thomas E. O’Brien and Monica H. Smith of Baker Botts and John Bash, Sean S. Pak and Kevin Hardy of Quinn Emanuel Urquhart & Sullivan.
Koninklijke is represented by Alexandra G. White and Hunter Vance of Susman Godfrey, Warren Harris of Bracewell and Kurt Truelove of Truelove Law Firm.
The case number is 06-24-00059-CV.
Fourteenth Court of Appeals, Houston
Pastor Sees $2.4M Judgement in STD Case Axed
A Houston pastor who was found by a jury to have given a woman genital herpes during their relationship will not have to pay a $2.45 million judgment against him after an appellate panel determined the lack of an expert’s testimony supporting that theory dooms the award.
In a 10-page opinion issued Thursday, a three-justice panel wiped out the award against Ralph Douglas West II and ordered that the plaintiff, identified as D.C., take nothing on her claims. The Houston appellate court opened its opinion by quoting a 1938 case, Kaster v. Woodson.
“What is an infection and from whence did it come are matters determinable only by medical experts,” that case held.
“In this case, we must address whether the same principle remains true today for a sexually-transmitted disease,” the panel wrote of the issue of first impression for the court.
On appeal, West argued a lack of expert testimony establishing that he was the cause of D.C. contracting herpes meant the award against him cannot stand.
“At trial, no medical experts testified. D.C. did not introduce any medical records or test results to prove she actually tested positive for genital herpes; instead, she simply testified about her symptoms and claimed she saw a doctor, who allegedly ordered lab tests that revealed she had herpes,” the panel wrote.
According to the opinion, D.C. filed suit against West in March 2020, seeking damages for assault, battery, intentional infliction of emotional distress, fraudulent concealment and fraudulent misrepresentation. In October 2023, a jury sided with D.C., awarding her $1.45 million for physical pain and mental anguish and $1 million in exemplary damages.
“In summary, knowledge concerning the transmission of diseases, particularly STDs, is simply outside the common experience of jurors. D.C. needed expert testimony to establish that West caused her to contract genital herpes,” the panel wrote.
Chief Justice Tracy Christopher and Justices Tonya McLaughlin and Kevin Jewell sat on the panel.
West is represented by Shawn Johnson of Houston and Kyle Carney of Fort Worth.
D.C. is represented by Misty Hataway-Coné of Coné PLLC and Shaun Murphy of Palm Springs, California.
The case number is 14-24-00502-CV.
Texas Supreme Court
SCOTX Sides with SpaceX, Axes New Trial Order
The Texas Supreme Court provided step-by-step instructions to the Cameron County Court Friday after siding with SpaceX and nixing a new trial order in a car accident case.
While commuting to work at a SpaceX site, Lauren Krueger, a SpaceX engineer, rear-ended a vehicle which was pushed into a pickup truck. The pickup passengers, who worked for Martin Ruiz Jr. at Ruiz Erectors as contractors for SpaceX, informed their employer of the accident and, after being examined by a doctor, were cleared to return immediately to work with some lifting restrictions.
However, the company’s attorney referred them to various doctors for chiropractic and other medical treatment. Then, the company filed a lawsuit in South Texas allegingKrueger was negligent and that SpaceX was vicariously liable.
A jury found that Krueger’s negligence caused the accident, but that she was acting outside the scope of her employment with SpaceX, and awarded damages of $123,500.
That wasn’t good enough for Hector Garcia Jr., Humberto Garcia and Jose Ruiz, who asked Judge David Alonzo Sanchez for a new trial.
Judge Sanchez granted the plaintiffs’ motion, stating the defense counsel’s closing included incurable argument, testimony about the lawyer’s doctor referrals was improperly admitted and the damages awarded were too low.
The defense counsel called the case “an attorney-driven shakedown” during closing arguments.
In Judge Sanchez’s order granting the motion for a new trial he wrote “the incurable arguments by defense counsel more likely than not cause the rendition of the subject verdict.”
While the Thirteenth Court of Appeals denied SpaceX and Krueger’s petition for mandamus relief, the high court disagreed and found the trial court had abused its discretion.
The justices directed the trial court to vacate the amended new-trial order, render a take-nothing judgement in SpaceX’s favor and redraft its new-trial order for Krueger.
“But because none of the stated reasons warrants a new trial on the jury’s finding that Krueger was not acting in the course and scope of her employment with SpaceX, the remaining new-trial ground — if supported by the record — applies only to the claims against Krueger,” the justices wrote in a per curiam opinion. “Thus, the redrafted order should be limited to Krueger, and the trial court must render judgment on the jury’s verdict as to SpaceX.”
Texans for Lawsuit Reform wrote an amicus brief in the case alleging personal injury attorneys and doctors are working together.
“After more than twenty years working on this issue in the legislative process, we believe these unpaid medical bills are never paid when plaintiffs lose their cases, which means there is an unwritten side deal between the plaintiffs’ attorneys and healthcare providers that the providers will accept losses in a few cases in exchange for a regular stream of business from the attorneys,” the brief read.
The attorney for the three employees, Brandy Wingate Voss with the Law Offices of Brandy Wingate Voss declined to comment.
Attorneys for Krueger and SpaceX did not immediately respond to requests for comment.
Founder of Gartoni Law Firm Michael Garatoni and Michael Raphael Cowen with Cowen Rodriguez Peacock were also attorneys for the three employees.
Krueger was represented by D. Alan Erwin Jr. with Roerig, Oliveira & Fisher.
SpaceX was represented by Morgan Lewis attorneys Michelle Pector, William R. Peterson andJared Wilkerson, and Roerig, Oliveira & Fisher partner David G. Oliveira.
The case number is 24-0290.
Justices Clarify Fifteenth Court of Appeals’ Jurisdiction
On Friday, the justices issued a per curiam opinion sending a dispute between a landowner and the Brazos River Authority back to the Tenth Court of Appeals, determining it did not belong within the exclusive jurisdiction of the Fifteenth Court of Appeals.
A jury had sided against Sandom Baumgardner in his fight to challenge the river authority’s demands that he remove a concrete boat ramp and retaining wall in Possum Kingdom Lake. A McLennan County district judge entered a permanent injunction in accordance with the verdict.
When Baumgardner appealed, the Tenth Court of Appeals determined the case belonged within the exclusive jurisdiction of the Fifteenth Court of Appeals and transferred it there. The Fifteenth Court of Appeals then recommended the case be sent back to the Waco appellate court, while the Waco appellate court held firm in its stance, too.
The Texas Supreme Court determined that because River Authorities don’t qualify as an “agency in the executive branch of the state government,” the appeal belongs in Waco.
“We conclude that river authorities are not part of the executive branch of the state government for purposes of Section 22.220(d),” the court held. “They certainly are not core executive agencies, which are generally described in Article IV of the Texas Constitution. Instead, river authorities derive their authority from a section contained within the ‘General Provisions’ article of the Constitution.”
The River Authority is represented by Roy L. Barrett and Stephanie E. Schwab of Naman, Howell, Smith & Lee.
Baumgardner is represented by Larry L. Fowler Jr. of Harris Cook.
The case number in the Texas Supreme Court is 24-9101; 15-24-00070-CV in the Fifteenth Court of Appeals and 10-24-00066-CV in the Tenth Court of Appeals.
U.S. Court of Appeals for the Fifth Circuit
Gloria’s Can’t Arbitrate Employee’s FLSA Suit
Fuentes Restaurant Management Services, which operates a popular chain of Latin cuisine restaurants known as Gloria’s, will not be allowed to arbitrate a Fair Labor Standards Act lawsuit brought by a server who alleges she was paid less than minimum wage.
The Fifth Circuit panel that issued the June 24 opinion upheld a ruling from U.S. District Court Judge Ed Kinkeade that found Gloria’s had “substantially invoked” the judicial process before trying to kick the case to arbitration.
The lawsuit was filed as a proposed class action in July 2023 by Dayana Garcia, who worked as a server at Gloria’s locations in Las Colinas and Colleyville. According to the opinion, Gloria’s filed an answer to the complaint, raised 31 affirmative defenses and, in response to a question from the court, responded that neither it nor Garcia were considering arbitration and that neither party was aware of any arbitration agreement.
The dispute proceeded to mediation in December 2023, at which time Gloria’s mentioned it wanted to compel arbitration. After mediation failed, Gloria’s moved forward with its bid to compel arbitration pursuant to an unsigned arbitration agreement.
“The restaurant defendants protest that they knew not of their arbitration rights when they submitted the joint report and engaged in the subsequent litigation conduct,” The Fifth Circuit wrote. “So, they argue, they cannot possibly have waived their right, because it was not ‘known’ to them. We are not convinced.”
Judges Dana M. Douglas, Priscilla Richman and Don R. Willett sat on the panel that issued the June 24 opinion.
Garcia is represented by Drew Herrmann and Pamela Herrmann of Herrmann Law in Fort Worth.
Gloria’s is represented by Christiana Signs of Reed Smith and Alicia Voltmer of Greenberg Traurig.
The case number is 24-10699.
U.S. Supreme Court
Texas’ Porn Website Age Verification Law Upheld
On Friday the U.S. Supreme Court issued a 6-3 ruling upholding a Texas law that requires pornography companies verify the age of those visiting their websites.
The law, H.B. 1181, imposes liability on entities that allow minors to access pornographic material online and requires age verification for visitors to certain websites. Justice Clarence Thomas, writing for the majority, explained that the burdens the law places on adult visitors to the websites do not render the law unconstitutional under the First Amendment.
“The power to require age verification is within a state’s authority to prevent children from accessing sexually explicit content,” he wrote. “H. B. 1181 is a constitutionally permissible exercise of that authority.”
Justice Elena Kagan authored a dissent, joined by Justices Sonia Sotomayor and Ketanji Brown Jackson, and argued the majority’s holding was at odds with prior opinions the court has issued. She asked whether Texas could achieve its goal of limiting minors’ access to pornography “without so interfering with adults’ constitutionally protected rights in viewing the speech H. B. 1181 covers?”
“That is the ultimate question on which the Court and I disagree,” she wrote. “The majority says that Texas may enforce its statute regardless, because only intermediate scrutiny applies and that test does not ask whether a State has adopted the least speech-restrictive means available. I disagree, based on conventional First Amendment rules and the way we have consistently applied them in this very context. The State should be foreclosed from restricting adults’ access to protected speech if that is not in fact necessary. The majority’s opinion concluding to the contrary is, to be frank, confused.”
After the Texas law was passed, PornHub opted to shut down its operations in Texas. This lawsuit was brought by the Free Speech Coalition in 2023.
In a press release issued after the Supreme Court’s ruling, Attorney General Ken Paxton called it a “major victory for children, parents and the ability of states to protect minors from the damaging effects of online pornography.”
The law carries penalties of up to $10,000 per day for companies that violate the age– verification requirements. The fine increases to $250,000 if a minor child is able to access pornography because of a lack of age verification.
The Free Speech Coalition was represented at the Supreme Court by Derek L. Shaffer of Quinn Emanuel Urquhart & Sullivan, and Solicitor General Aaron Nielson argued the case for Texas.
The case number is 23-1122.
Alexa Shrake contributed to this report.
Can you not get enough 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.
A federal judge declared that President Donald Trump’s executive order targeting Susman Godfrey is an illegal act of retaliation and violates the First Amendment of the U.S. Constitution. The judge also permanently enjoined all federal officials from enforcing the order against the Texas-based law firm. U.S. District Judge Loren AliKhan of Washington, D.C., in a 53-page opinion issued Friday, states that President Trump’s order issued in April “threatens the independence of the bar — a necessity for the rule of law.”
A case that began 11 years ago with a fatal crash on an icy stretch of highway near Odessa was ended by the Texas Supreme Court when the justices issued an opinion wiping out a more than $100 million verdict against trucking company Werner Enterprises and its driver.
The Texas Supreme Court also ruled that the Winter Storm Uri lawsuits brought by thousands of individuals and small businesses against electric transmission and distribution utilities in Texas are legally flawed, but the justices allowed lawyers for the plaintiffs to amend their lawsuits to fix the legal issues and even provided a roadmap for their possible success. In a unanimous decision, the state’s highest court dismissed allegations of intentional nuisance and gross negligence against Oncor, CenterPoint and American Electric Power, but the decision to allow the plaintiffs to replead their gross negligence claims is viewed by attorneys for the plaintiffs as a significant victory because it keeps their lawsuits alive and moving forward.
U.S. District Judge Ada Brown has set a schedule that would see the preliminary settlement finalized in December. The company has agreed to pay two classes a total of $177 million.
The Texas Supreme Court addressed ownership of “produced water,” an oilfield byproduct made increasingly valuable by new treatment methods. Absent a specific conveyance, the court said in a closely watched case, a surface estate does not retain ownership of the water separated from hydrocarbons during hydraulic fracturing operations.
After receiving some guidance from the Texas Supreme Court, the U.S. Court of Appeals for the Fifth Circuit has determined that a former law professor at Southern Methodist University will get another chance to bring defamation claims against some of her former colleagues.
In a five-to-four decision, the U.S. Supreme Court handed Gibson Dunn senior associate Stephen Hammer a partial victory Thursday in a major immigration law dispute that divided the federal circuit courts of appeal and could impact thousands of asylum cases pending in the lower courts.
PLUS — Headlines of interest from The Dallas Morning News: