In this edition of Litigation Roundup, Yelp prevails against the Texas attorney general’s office in a suit that accused the website of violating the Texas Deceptive Trade Practices Act, a Dallas-area law firm represents an insurance company accusing nearly 50 defendants of RICO violations related to New York workers’ compensation benefits, and a divided Texas Supreme Court issues a ruling clarifying the tolling period in a healthcare liability claim.
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Bastrop County District Court
Yelp Gets Texas AG’s Suit Tossed
A lawsuit lodged by the Texas attorney general in September has been dismissed by a judge who agreed with Yelp that Bastrop County courts didn’t have jurisdiction to hear the dispute.
Bastrop County District Judge Reva Towslee-Corbett signed an order dismissing the case with prejudice on Feb. 28 after granting Yelp’s special appearance.
Laura Prather of Haynes Boone, who represents Yelp, issued a statement that the firm is “dedicated to protecting our clients’ right to free speech.”
“We are pleased with the court’s decision, which rightfully recognizes the case should never have been filed in Texas,” she said.
Texas accused Yelp of violating the Texas Deceptive Trade Practices Act “by appending inaccurate and misleading language to listings on pregnancy resource centers appearing in the search results on Yelp’s app and website.”
The basis of the lawsuit is Yelp’s disclaimer on listings for “pregnancy resource centers” explaining to site visitors that the centers “typically provide limited medical services and may not have licensed medical professionals onsite.”
Texas called the disclaimer misleading.
The dismissal of Texas’ suit came about one month after U.S. District Judge Trina L. Thompson in the Northern District of California denied Yelp’s request for an injunction that would bar Attorney General Ken Paxton from “taking any further action to penalize Yelp’s publication of truthful speech about crisis pregnancy centers, including the statement that CPCs ‘typically provide limited medical services and may not have licensed medical professionals onsite.’”
Judge Thompson wrote in the 11-page order that she would be denying the motion and dismissing the case, “albeit reluctantly.”
Texas is represented by Scott Froman and Christin Cobe Vasquez of the OAG’s Consumer Protection Division.
Yelp is also represented by Michael Lambert of Haynes Boone.
The case number is 2519-335.
Eastern District of New York
Investment Management Firm Ducks Mass Tort Product Liability Suit
Investment management firm TPG Inc. and its affiliates, including Exactech — a medical device company that makes hip and knee replacements — have been dismissed from a mass tort product liability multidistrict litigation.
U.S. District Judge Nicholas G. Garaufis issued an order March 7 granting a dismissal request TPG lodged in June. TPG had argued that the plaintiffs in the suit, who had all received hip or knee replacements, failed to sufficiently plead “indirect liability, including corporate veil-piercing and successor liability theories.”
“Because plaintiffs did not adequately plead that TPG defendants had requisite control over Exactech and that they used this control to abuse the privilege of corporate law’s limited liability, plaintiffs have failed to demonstrate that piercing the corporate veil to hold TPG defendants liable for Exactech’s conduct is warranted,” the judge wrote.
The order brings an end to all personal injury suits against TPG that were originally filed in Texas, Alabama, Arkansas, California, Colorado, Connecticut, Florida, Kentucky, Louisiana, Maine, New Jersey, New York, North Carolina, Ohio, Pennsylvania, South Carolina, Tennessee and Virginia.
The Texas-based attorneys representing plaintiffs are Quentin Brogdon and Robert D. Crain of Crain Brogdon Rogers, Ben Martin and Courtney Smith of the Ben Martin Law Group, Matthew McCarley of Forester Haynie. Arati C. Furness of Nachawati Law Group, Laura Baughman of Martin Baughman, Patrick Wigle and Peter A. Kraus of Walters & Kraus, Shreedhar R. Patel of Simon Greenstone Panatier, Avery Sheppard of Ware Jackson Lee O’Neill Smith & Barrow and Matthew Kelley and Sean E. Breen of Howry Breen & Herman.
TPG is represented by Jay P. Lefkowitz, Mark Premo-Hopkins, Christa Cottrell and Cameron Ginder of Kirkland & Ellis in Chicago.
The case number is 1:22-md-03044.
Dallas-area Firm Goes After 46 Defendants in RICO Suit
Garland-based firm The Willis Law Group is representing Roosevelt Road and Tradesman Program Managers in a lawsuit accusing 46 medical industry defendants — including about a dozen doctors — of violating the Racketeer Influenced and Corrupt Organizations Act.
Roosevelt, which provides reinsurance to Tradesman, an insurance agency, filed suit March 1 against dozens of doctors and medical practice offices, mostly located in New York and New Jersey, of conducting a “systematic exploitation” of the New York State workers’ compensation system.
The plaintiffs allege the defendants have submitted bills and documentation pertaining to alleged workplace injuries and subsequent medical treatment “that were ultimately designed to result in windfall tort claims alleging violations of sections 240 and 241 of New York’s Labor Law.”
“Specifically, plaintiffs possess the founded belief that the claimants and others similarly situated are targeted in part due to their lack of sufficient proficiency in the English language and correlating reliance upon those who prey upon them, including but not limited to defendants identified herein and those not yet named,” the lawsuit alleges. “The claims at issue arise from largely unwitnessed, and in many cases belatedly reported, alleged incidents in which the claimants either were treated and released from emergency care facilities with minor complaints or where they did not actually proceed to hospitals proximate to the alleged date of incident.”
The case has been assigned to U.S. District Judge Nina Gershon and U.S. Magistrate Judge Lois Bloom.
Roosevelt Road and Tradesman Program Managers are represented by Aaron Meyer and Michael A. Graves of The Willis Law Group.
The defendants had not retained counsel as of Monday.
The case number is 1:24-cv-01549.
Texas Supreme Court
Healthcare Liability Claim Revived in 8-1 Ruling
Dorothy Hampton, who accused Dr. Leonard Thome of prematurely releasing her from the hospital following surgery after she suffered a fall at her home, will get another chance to bring her lawsuit after a divided Texas Supreme Court found a tolling provision saved the suit.
At issue in the case was a tolling provision under the Texas Medical Liability Act that extends the two-year statute of limitations to bring suit by 75 days if the claimant gives notice of suit “accompanied by” a medical authorization form identifying all the claimant’s healthcare providers.
Hampton filed suit outside the two-year limitations period but within the 75-day tolling period. But the medical authorization form she filed with the court was missing the names of several health care providers who had treated her.
Thome argued in seeking summary judgment that the incomplete form failed to trigger the tolling provision. A trial court disagreed and allowed the suit to proceed, but a Ninth Court of Appeals panel agreed with Thome, finding the defective form meant tolling did not apply to Hampton’s suit.
The Texas Supreme Court on Friday determined 8-1 “that an imperfect medical authorization form is nevertheless a medical authorization form, which is sufficient to toll the statute of limitations for 75 days under section 74.051(c).”
“Whatever imperfections or omissions existed in the plaintiff’s medical authorization form in this case, it was genuinely a medical authorization form resembling the one required by the Legislature, and the plaintiff served it with the notice of claim,” the majority held. “This was sufficient, as we understand this statutory scheme, to trigger the 75-day tolling period, which means the suit was timely.”
In a dissent, Justice Jeff Boyd wrote that he would have held only a fully compliant authorization form tolls the statute of limitations.
“If a claimant doesn’t do what the statute says a claimant must do to get the tolling, that claimant doesn’t get the tolling,” he wrote.
Hampton is represented by Collin D. Cobb of Port Neches.
Thome is represented by James B. Edwards and Stacy T. Garcia of Edwards & Garcia and Diana L. Faust and Michelle E. Robberson of Cooper & Scully.
The case number is 22-0435.
U.S. Court of Appeals for the Fifth Circuit
Pornography Trade Association, Texas AG Get Mixed Bag, 2-1 Ruling
Judges Jerry E. Smith and Jennifer Walker Elrod issued an opinion on March 7 partially undoing a district court’s preliminary injunction that had temporarily halted Texas from enforcing a new law, H.B. 1181, that imposes new standards on pornographic websites.
Adult industry trade association Free Speech Coalition had argued the law’s requirements that its members verify the age of website visitors and display a health warning about the effects of the consumption of pornography violated their First Amendment rights.
The majority vacated the injunction against the age-verification requirement but affirmed the injunction over the health warnings, finding that those “unconstitutionally compel speech.”
“The health warnings, taken as a whole, might advance the state’s stated interests. … But Texas must meet a higher standard than ‘might,’” the court wrote. “Because Texas has not made such a showing, we adopt the approach recently taken by the Ninth Circuit: ‘[C]ompelling sellers to warn consumers of a potential ‘risk’ never confirmed by any regulatory body — or of a hazard not ‘known’ to more than a small subset of the scientific community — does not directly advance’ the government’s interest.”
The majority wrote that “the dissent’s reading implies that the invention of the Internet somehow reduced the scope of the state’s ability to protect children. That is a dubious principle without support in existing Supreme Court caselaw.”
Judge Patrick E. Higginbotham authored a partial dissent explaining he would affirm the district court’s preliminary injunction and send the case back to that court for a trial.
“To these eyes, H.B. 1181 cannot be reasonably read to reach only obscene speech in the hands of minors,” he wrote. “… H.B. 1181 limits access to materials that may be denied to minors but remain constitutionally protected speech for adults. It follows that the law must face strict scrutiny review because it limits adults’ access to protected speech using a content-based distinction — whether that speech is harmful to minors.”
Free Speech Coalition is represented by Scott Cole, Derek L. Schaffer, Arian Koochesfahani and Michael Zeller of Quinn Emanuel Urquhart & Sullivan and Jeffrey Sandman of Webb Daniel Friedlander.
Texas is represented by Lanora Pettit, Kyle Highful, John Ramsey and Coy Wesbrook of the attorney general’s office.
The case number is 23-50627.
SpaceX Wants Rehearing En Banc in NLRB Case
Two days after a panel sided against Space Exploration Technologies 2-1 and denied its request to keep a lawsuit it filed against the National Labor Relations Board in the Southern District of Texas, the company asked the full Fifth Circuit to rehear the case.
In a March 5 ruling denying SpaceX’s petition for writ of mandamus, Judge Jennifer Walker Elrod dissented, writing that in her view the case belongs in the Southern District of Texas. She criticized Judges Catharina Haynes and Dana M. Douglas for issuing a “one-line order” denying relief.
“In doing so, the panel permits an erroneous view of the requirements for filing claims in our circuit, risks confusion amongst the district courts of our circuit, and deprives plaintiffs of the opportunity to seek justice in a lawful venue,” she wrote.
SpaceX filed suit in the Southern District of Texas seeking injunctive relief from hearings before the NLRB, alleging the structure of the hearings violates the constitution. The district court granted the NLRB’s motion to transfer the case to the Central District of California, holding that most of the events giving rise to the lawsuit occurred there.
SpaceX contended that because it operates a major facility in the Southern District of Texas, filing suit in Brownsville was appropriate.
“NLRB cannot seek to condemn SpaceX’s past labor practices in the Southern District of Texas, bind SpaceX’s future practices in the Southern District of Texas, and at the same time avoid proper venue in the Southern District of Texas,” Judge Elrod wrote.
SpaceX is represented by Michael E. Kenneally, Catherine Eschbach, Harry Johnson III and Amanda Salz of Morgan, Lewis & Bockius.
NLRB is represented by David Boehm and Paul A. Thomas of the NLRB and Benjamin Lyles of the Department of Justice.
The case number is 24-40103.