In this edition of Litigation Roundup, a team of Kirkland lawyers gets an early win for a client facing a whistleblower’s False Claims Act suit, a suit stemming from the romance scandal involving former judge David Jones gets trimmed and the Dallas appellate court declines to bring an early end to a barratry lawsuit against a personal injury law firm.
In judicial news, Gov. Greg Abbott last week appointed Cory Liu, a Butler Snow partner and former clerk for Fifth Circuit Court of Appeals Judge Andrew Oldham, to serve as the new judge of the 250th Judicial District Court in Travis County. He fills the seat left vacant after Karin Crump won election to the Third Court of Appeals in Austin.
Liu, an Austin native, is a 2015 graduate of Harvard Law School, where he served as editor-in-chief of the Harvard Journal of Law & Public Policy.
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.
Southern District of Texas
Judge Moses Trims Defendants in Judge Jones-Related RICO Suit
Following a recent show-cause hearing, Chief U.S. District Judge for the Western District of Texas Alia Moses dismissed Portage Point Partners and its founder Matthew Ray from a lawsuit brought by a former CEO who alleges he was the victim of a conspiracy carried out in a bankruptcy proceeding before former judge David Jones.
The fraud and racketeering lawsuit was filed Feb. 26, 2024, by former Bouchard Transportation Company CEO Morton S. Bouchard III against Jones, former Jackson Walker bankruptcy partner Elizabeth Freeman, Jackson Walker, Kirkland & Ellis and Portage Point Partners, a bankruptcy advisory firm appointed by Jones to oversee the BTO bankruptcy in 2020. The lawsuit was filed in the wake of the public disclosure of a previously private romantic relationship between Jones and Freeman.
Bouchard alleges the defendants worked together with restructuring advisor Portage Point and Ray to allegedly dismantle his company, which was “worth nearly three quarters of a billion dollars, for pennies on the dollar.” He alleges the defendants “orchestrated a coup” to have him removed as CEO after he “began scrutinizing professional fees” that were being paid out in the bankruptcy.
Bouchard was removed as CEO on Feb. 26, 2021, by Jones, who ordered the move sua sponte, or on his own authority, without any party requesting that action. Ray was appointed as his replacement.
In response, Portage Point argued Bouchard was trying to make an “end-run around the bankruptcy process to avenge personal grievances, settle scores and seek recoveries that he was unsuccessful in achieving in Chapter 11.”
“Plaintiff is unhappy that the bankruptcy court removed him from his role as CEO of the company,” Portage Point argued. “But that removal, by plaintiff’s own admission, occurred ‘sua sponte,’ after the bankruptcy court concluded that plaintiff was actively impeding the Chapter 11 process, preventing BTC from making payroll, and blocking its ability to access needed interim financing.”
Judge Moses entered an order dismissing Portage Point and Ray March 5, and the following day she entered an order sending the case back to U.S. Bankruptcy Judge for the Southern District of Texas Christopher Lopez to determine if Bouchard has standing to bring his lawsuit.
“On March 4, 2025, the Court held a hearing in this case,” Judge Moses wrote in the two-page order. “During the hearing, multiple defendants claimed that the plaintiff lacks standing to bring this lawsuit. Upon questioning by the Court, it was suggested that the plaintiff must seek standing from the bankruptcy court.
“The plaintiff indicated at the hearing that he is amenable to seeking standing before the bankruptcy court currently presiding over the [Bouchard Transportation Co.] bankruptcy case. The Court finds that a limited-scope remand is necessary.”
Portage Point and Michael Ray are represented by Mike Lynn of Lynn Pinker Hurst & Schwegmann and Anastasia Cembrovska, Duane Loft, John McAdams and Shireen Barday of Pallas Partners.
Bouchard is represented by Mikell West of Bandas Law Firm.
Jones is represented by David Boies and Tyler Ulrich of Boies Schiller Flexner.
Freeman is represented by Thomas M. Kirkendall.
Jackson Walker is represented by Rusty Hardin, Emily Smith, Jennifer Brevorka and Leah Graham of Rusty Hardin & Associates.
Kirkland is represented by John Hueston, Karen Ding, Michael Todisco and Warren Crandall of Hueston Hennigan and David Beck and Jacqueline Furlow of Beck Redden.
The case number is 4:24-cv-00693.
Eastern District of Texas
Pharmaceutical Co. Beats Back FCA Suit
U.S. District Judge Rodney Gilstrap has ended a whistleblower’s lawsuit accusing the pharmaceutical company formerly known as Allergan (now part of AbbVie) of orchestrating a nationwide kickback scheme that lasted 15 years.
College student Braeden Hearrell had filed suit in June 2021, alleging Allergan was violating the False Claims Act by systematically paying kickbacks to physicians, referred to as “key opinion leaders,” who would promote off-label uses for Botox. He also accused the company of telling doctors to miscode claims for reimbursement to the government.
Judge Gilstrap heard oral arguments on Allergan’s motions for summary judgment Feb. 20 and entered final judgment ending the lawsuit March 3.
“Relator conceded at oral argument that he has no evidence that links any [key opinion leader] payment to any referral or off-label prescription of Botox,” Judge Gilstrap wrote in a four-page order. “Relator further conceded that he has no evidence from any doctor that Allergan paid them to prescribe Botox off-label. Indeed, relator failed to depose or obtain documentary evidence from any KOL. As a result, there is a total absence of evidence within the record which supports relator’s allegation that Allergan’s KOL payments were in exchange for referrals to pediatric specialists.”
The case had been set to go to trial later this month.
Allergan is represented by Diana Watral, James Hileman, Jason Feld, Nicholas Ruge and Elizabeth Kelly of Kirkland & Ellis.
Hearrell is represented by Alexander B. Klein III of The Klein Law Firm and James Underwood and Melissa Smith of Gillam & Smith. The federal government is represented by Adrian Garcia of the Department of Justice.
The case number is 2:21-cv-00204.
Eastern District of Louisiana
EPA Drops Suit Against Neoprene Manufacturer
In a lawsuit that was closely watched by many chemical companies, the U.S. Environmental Protection Agency announced Monday it had dismissed its suit against Louisiana-based Denka Performance Elastomer, the sole producer of neoprene in the United States.
“The dismissal of this case is a step toward ensuring that environmental enforcement is consistent with the law,” said EPA Administrator Lee Zeldin. “While EPA’s core mission includes securing clean air for all Americans, we can fulfill that mission within well-established legal frameworks, without stretching the bounds of the law or improperly implementing so-called ‘environmental justice’.”
The federal government had gone after the manufacturer in February 2023, pointing to Section 303 of the Clean Air Act in an effort to shut down the company’s facility in LaPlace.
The Department of Justice issued a news release Friday saying the dismissal of the suit was an example of “delivering on President Trump’s promise to dismantle radical DEI programs and restore integrity to federal enforcement efforts.”
In 2017, Denka reached a settlement with the state of Louisiana, agreeing to invest $35 million to cut its emissions of chloroprene — classified as a likely carcinogen that’s used to make neoprene — by 85 percent. The lawsuit had alleged those efforts had not been sufficient to reduce the risk to surrounding communities.
“If Denka continues to emit chloroprene at its current levels, chloroprene concentrations in the communities surrounding the Facility will continue to present an imminent and substantial endangerment,” the suit alleged.
The case had been scheduled for trial next month before U.S. District Judge Carl J. Barbier.
The government is represented by Jonah M. Seligman and Steven Shermer of the Department of Justice.
Denka is represented by Robert E. Holden of Jones Walker and Jason B. Hutt, David A. Super, Jeffrey R. Holmstead and Kevin M. Voelkel of Bracewell.
The case number is 2:23-cv-00735.
Fifth Court of Appeals, Dallas
Law Firm Can’t Use TCPA to End Barratry Suit
Schuerger Shunnarah Trial Attorneys cannot bring an early end to the barratry lawsuit brought by Brianna Garcia by using the Texas Citizens Participation Act because of the commercial speech exemption under the anti-SLAPP law.
That ruling, issued by a three-justice panel March 7, affirmed an order issued by Dallas County Court-at-Law No. 4 Judge Dianne K. Jones in April 2024.
Garcia alleges she was “relentlessly pursued via repeated cell phone text messages and phone calls” in the days following a Nov. 10, 2023, car crash that she and her two infant sons were involved in. The organization calling her was called Constitutional Advocates for Victim’s Rights, and she accuses the law firm of acting through that group in an illegal client-solicitation scheme.
According to the opinion, the attorney representation agreement she signed included a clause stating she was “not solicited or promised anything by [SSTA] prior to choosing them as my legal representative” and that she chose the firm “with no undue influence or promises.”
But 12 days after signing the agreement, she filed this lawsuit bringing claims for civil barratry and conspiracy against CAVR and SSTA. SSTA argued the lawsuit should be dismissed under the TCPA because it was brought in response to their exercise of the rights of association and free speech. Garcia argued the commercial speech exemption meant the TCPA — a law intended to bring an early end to baseless lawsuits meant to chill free speech — doesn’t apply to her claims.
At a hearing on the motion to dismiss, Judge Jones asked Garcia about the signed document stating she wasn’t solicited and why she should overlook that.
“Counsel responded that Garcia’s admission was only that she signed the documents sent to her by CAVR and SSTA, not that she was not solicited,” the opinion reads. “Counsel acknowledged the documents could potentially be used to impeach her credibility at trial, but contended they were not judicial admissions that would prevent her from pursuing her barratry and conspiracy claims.”
The law firm had argued that Garcia’s signature on the documents constituted a judicial admission that she hadn’t been solicited, which would doom her claims. But the appellate panel wrote, “A judicial admission authenticating a document signed prior to litigation does not constitute a judicial admission of the validity of the document’s contents or the binding nature of its provisions. Those matters are analyzed separately.”
“What she disputes is that the statements in the documents regarding solicitation are an accurate representation of what occurred,” the panel held. “This is consistent with her unequivocal position throughout the course of these proceedings that she was contacted by CAVR for the purpose of convincing her to hire SSTA and immediately sent multiple documents prepared for her execution. As stated above, these allegations are sufficient to bring Garcia’s claims with the TCPA’s exemption for commercial speech and conduct.”
Chief Justice J.J. Koch and Justices Bonnie Goldstein and Cynthia Barbare sat on the panel.
Garcia is represented by Matthew J. Kita of Dallas.
Schuerger Shunnarah Trial Attorneys is represented by Scott P. Stolley of Stolley Law, Bruce A. Campbell and John Cameron Stevenson of Campbell & Associates Law Firm and Royce B. West of Dallas.
The case number is 05-24-00611-CV.
U.S. Supreme Court
Texas Battles NRC Over Permian Basin Waste Facility Plans
On March 5, the U.S. Supreme Court heard oral argument from lawyers representing Texas in a case where the state is opposing plans from the Nuclear Regulatory Commission to store spent nuclear fuel in the Permian Basin.
Solicitor General Aaron Nielson, argued the case on behalf of Texas, told the court in briefing that it should not allow the federal government to store up to 40,000 metric tons of nuclear waste above ground in the Permian Basin, “the site of the world’s most productive oil field and the only source of safe water for hundreds of miles.”
In October, the high court consolidated for oral argument two lawsuits — U.S. Nuclear Regulatory Commission v. Texas and Interim Storage Partners v. Texas — where Texas has argued that congress determined in 1987 such waste must be stored underground in Yucca Mountain, Nevada.
Attorney General Ken Paxton said in a news release the fight is about protecting Texans “from an illegal plan to send dangerous radioactive materials to the beating heart of America’s energy industry.”
“The Commission should follow the law instead of jeopardizing national security, threatening environmental catastrophe and inviting untold disaster,” he said.
The case numbers are 23-1300 and 23-1312.