In this week’s edition of litigation roundup, Targa Channelview files its opening brief with the Texas Supreme Court in a long-running $129 million fight with Vitol Americas, Maersk says its not responsible for cargo lost at sea and a former Abraham Watkins’ associate accused of taking files and clients from the firm fires back with an anti-SLAPP dismissal bid.
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Harris County District Court
Ex-Abraham Watkins Associate Moves to Toss Firm’s Suit
Edward Festeryga has asked a judge to toss a lawsuit filed against him by his former firm that accused him of wrongly taking client files and soliciting clients when he left the firm, arguing the suit must be dismissed under a state free speech law.
The motion, filed Nov. 29, is seeking dismissal of the lawsuit brought earlier this month by Abraham Watkins Nichols Agosto Aziz & Stogner under the Texas Citizens Participation Act, the state’s law intended to combat strategic lawsuits against public participation, or SLAPP suits.
Festeryga told the court that this suit is really about one thing: whether he’s entitled to bonus payments for recoveries he secured on behalf of firm clients. Abraham Watkins — which is suing Festeryga on claims of breach of fiduciary duty, tortious interference with contract and conversion — is also seeking a declaratory judgment that such payments were purely discretionary, while Festeryga argues he was fired in retaliation for exploring other employment opportunities and was denied bonus payments he’s entitled to as punishment.
It was only after he sent a letter demanding his bonus payment that Abraham Watkins filed this lawsuit accusing him of taking clients and files, Festeryga told the court. He said he never solicited firm clients to join him at his new firm and only took copies of files he had worked on for clients, which he said he is allowed to do under state rules, according to the lawsuit.
Festeryga did reach out to firm clients to see if they would be wiling to provide him video testimonials about his legal services, but never solicited them to switch firms, he said.
“Mr. Festeryga files this motion under the TCPA because the TCPA specifically applies to any conduct related to the gathering of consumer opinions, consumer commentary, and business reviews,” he argued. “Mr. Festeryga’s attempt to gather testimonial videos from former clients is therefore a protected activity under the TCPA.”
Harris County District judge Kristen Hawkins has scheduled a temporary injunction hearing to take place today.
Festeryga is represented by Guillermo Alarcon of Armbrust & Brown.
Abraham Watkins is represented by its own Muhammad S. Aziz and Dale Jefferson and Raul H. Suazo of Martin Disiere Jefferson & Wisdom.
The case number is 2022-76196.
Northern District of Texas
Maersk Takes $2M Lost Cargo Claim to Court
Maersk, facing the threat of litigation from the unhappy would-be recipients of cargo that was lost at sea, has filed a federal lawsuit alleging another party is responsible for the losses.
The shipping giant told the court it had an agreement with Unifeeder under which Unifeeder would transport “containerized vessels” for Maersk from a port in Jeddah, Saudi Arabia to a port in Sudan. Things went awry in November 2021, when 45 shipping containers went overboard Unifeeder’s vessel, 41 of which were being carried for Maersk.
The lawsuit against Unifeeder brings claims for negligence and breach of contract, alleging that under an agreement between the parties Unifeeder must indemnify Maersk against the lost cargo claims it is facing, which total $2.5 million already.
The case, filed Nov. 30, has been assigned to Senior U.S. District Judge Sam R. Cummings.
Maersk is represented by Scott R. Wiehle and Joseph D. Austin of Kelly Hart & Hallman and J. Stephen Simms of Simms Showers.
Counsel for Unifeeder has not yet appeared.
The case number is 3:22-cv-02672.
First Court of Appeals
Allied Aviation Files Brief in $352M Injury Suit
Allied Aviation Fueling Company of Houston has filed its opening brief on appeal, arguing the plaintiff who secured a nine-figure jury verdict against it in a personal injury suit did so by making the case “about how bad Allied is,” quoting the trial court judge who presided over the suit.
“That never should have been the case. Plaintiffs had no viable claim against Allied for negligent training, much less grossly negligent training,” the company argued in the Nov. 30 brief. “Further, Texas law forbade the submission of a negligent training claim here because Allied stipulated to vicarious liability for Willis’s negligence.”
After a remittitur of $117.5 million, the trial court entered final judgement in February in favor of paralyzed United Airlines service worker Ulysses Cruz for $235.2 million. Cruz, who suffered permanent brain damage and requires 24-hour assistance, was walking behind the wing of an aircraft departing from its gate when an Allied Aviation Fueling van hit him, throwing him several feet through the air before he hit the tarmac.
Allied told the court on appeal that the trial court’s inclusion of Allied in the jury charge was “patently erroneous and manifestly harmful.”
“The inclusion of Allied played right into — and enabled the success of — plaintiffs’ unrelenting campaign to villainize Allied,” the company argued.
The case number is 01-22-00083-CV.
Eighth Court of Appeals
UT Loses Appeal of Newspaper’s Information Request Win
The Austin American-Stateman secured a ruling that it is entitled to documents it requested from the University of Texas about the final results of disciplinary proceedings against students alleged to have perpetrated crimes involving violence, including sexual violence.
The panel held, in a Nov. 29 opinion, that the university “failed to establish a compelling reason for withholding the requested information” and that a trial court correctly granted the newspaper’s motion for summary judgment.
“The Statesman’s requested information does not implicate any recognized zone of constitutional privacy, and the University has not presented this court with any statutory law or judicial opinion that would indicate otherwise,” the court wrote.
The case was transferred from the Third Court of Appeals in Austin to the El Paso court of appeals under the Texas Rules of Appellate Procedure that allow for the move in the interest of docket equalization.
Chief Justice Yvonne T. Rodriguez and Justices Gina M. Palafox and Jeff Alley sat on the panel.
The Austin American-Statesman is represented by Maitreya Tomlinson of The Tomlinson Firm and John Bussain of The Bussain Law Firm
The University of Texas is represented by H. Melissa Mather of the Texas attorney general’s office.
The case number is 08-20-00157-CV.
Texas Supreme Court
Targa Appeals Vitol’s $129M Win
A long-running dispute between Targa Channelview and energy and commodity trading company Vitol Americas Corp has entered its next chapter after Targa filed a petition with the state’s high court Nov. 28.
The appeal comes after the Fourteenth Court of Appeals in September let stand a $129 million damages award for Vitol, tied to breach of contract in the suit over a soured deal for a crude oil storage and processing facility.
The Fourteenth Court of Appeals did trim the award, however, finding that Vitol couldn’t hang on to about $10.5 million in damages stemming from a fraud claim against Targa, a midstream resource management company.
Targa argues on appeal that the Houston appellate panel badly botched interpreting the contract between the parties and that Vitol is entitled to nothing.
“Here the court of appeals held that Vitol was entitled to a refund of $129 million when the agreement did not provide for a refund under any circumstances — and certainly not in the absence of a default as defined in the agreement,” Targa said. “In construing the contract, the court of appeals added words, deleted words, rewrote definitions, disregarded the document’s structure, and reallocated key risks.”
The dispute between the companies is rooted in a December 2015 agreement under which Vitol would deliver crude to a so-called “splitter facility” were crude oil is separated into various products. The facility would be built, owned and operated by Targa.
When Targa failed to build the facility 27 months later, as required under the deal, Vitol terminated the agreement and filed suit alleging breach of contract and that Targa had fraudulently misrepresented the capacity of the facility.
Targa is represented by David Gunn, Erin H. Huber and Joshua S. Smith of Beck Redden, Thomas C. Wright, Eva Guzman and Rachel H. Stinson of Wright Close & Barger, David E. Keltner, Joe Greenhill, Caitlyn Hubbard and Jacob A. deKeratry of Kelly Hart & Hallman, William J. Boyce of Alexander Dubose & Jefferson, Jennifer Caughey, Danica L. Milios and Cody Lee Vaughn of Jackson Walker and Timothy C. Shelby, Daryl L. Moore, Ryan Hackney, Jason McManis, Paul Turkevich and Monica Uddin of Ahmad Zavitsanos & Mensing.
Vitol is represented by Macey Reasoner Stokes, Anthony J. Lucisano and Elisabeth Butler of Baker Botts and Lee L. Kaplan, Garland “Land” Murphy, Eugene Zilberman and Jonathan Mondel of Smyser Kaplan Veselka.
The case number is 22-0958.
U.S. Court of Appeals for the Fifth Circuit
Court Votes 12-3 Against Rehearing Courtroom Prayer Case
A September ruling issued by a split panel in September, siding with Montgomery County Justice of the Peace Wayne Mack in a lawsuit over his practice of opening court proceedings with prayer, will stay in place.
The court issued an order Dec. 2 explaining that one member of the court had requested a poll to rehear the case en banc and only three judges voted in favor, with 12 voting not to rehear the case, according to the order.
The panel that decided the case in September found that Mack’s practice did not constitute coercion, and ended the lawsuit brought by the Freedom From Religion Foundation. Judge E. Grady Jolly authored a dissent, writing that Mack had said in his own words that the prayer ceremony is intended to set a tone “for everybody that’s in the courtroom.”
“That the prayer ceremony is directed at the audience Judge Mack holds power over further demonstrates the likelihood of coercion. … For the majority to find that there is no evidence of coercion, suggests, in my opinion, willful blindness and indisputable error,” he wrote.
Judge Jim Ho recused himself from the rehearing vote, and Judges Stephen A. Higginson, James L. Dennis and James E. Graves Jr. were the only three who voted for rehearing en banc.
Judge Higginson, joined by Judge Graves, dissented from the majority’s decision not to rehear the case en banc, writing that Mack’s conduct “violates the Establishment Clause of the First Amendment.”
Judge Higginson noted that the court called “speculative” evidence in the record that Mack scans the courtroom to see who is bowing for prayer in compliance with his command and testimony from two who appeared before him that they believe they were punished for not participating.
He wrote that a “reasonable factfinder could decide otherwise.” The judge went on to detail the hardships incurred by a low-income family who may be forced to shoulder the burden of paying a $500-fine imposed by Mack, or the lifelong difficulties someone may face in getting a job or housing after pleading guilty to a misdemeanor offense before Mack.
“So, a criminal defendant who does not want to leave the court to which he has been summonsed, or participate in a court prayer, is put to an intolerable — and unconstitutional — choice. Either bow to a faith in which he may not believe or refuse and risk everything,” the judge wrote. “Aside from harming individuals, compulsory prayer also damages the public’s trust that courts are impartial decisionmakers.”
The case number is 21-20279.