Businesses and individuals who are plaintiffs and defendants in civil disputes in the Texas courts of appeals have been treated much more evenly in 2019 than they were in 2018 due to a wave of new judges joining those courts, according to a new study issued Monday by the Haynes and Boone law firm.
The new report shows that appellate judges in Texas are so far this year reversing lower court litigation decisions equally for defendants and plaintiffs, which is a dramatic shift from only one year ago when Republican judges controlled the state appellate benches and favored defendants over plaintiffs by an overwhelming margin.
At the same time, the Haynes and Boone survey indicates that the hopes of plaintiffs’ attorneys that the newly-elected Democratic appellate judges would be a boon to their practices are not close to coming true.
The exclusive data shows that the Republican-controlled appellate courts during the final four months of 2018 reversed 39% of the cases won by plaintiffs in the lower courts, but they overturned only 5% of the verdicts won by defendants – a disparity of 8 to 1.
But the numbers changed dramatically during the first eight months of 2019.
Since Jan. 1 when two-dozen Democratic appellate judges who defeated incumbent Republican jurists took the bench, the Texas appellate courts have reversed 17% of verdicts that favored plaintiffs and it overturned 18% of cases won by defendants. Plaintiff’s attorneys hoped the reversal rate in favor of their clients would be significantly higher.
“The shift is particularly pronounced in the four courts of appeals – Austin, Dallas and the two appellate courts in Houston – where Democrats won a majority of the seats in November,” said Haynes and Boone appellate law partner Kent Rutter, who offices in Houston. “Defendants are still prevailing more often than plaintiffs, but the gap has narrowed.”
Plaintiffs in tort and consumer matters were the biggest beneficiaries.
Rutter said the data appears to show that the new appellate judges have a much deeper respect for decisions made by jurors and give greater deference to rulings made by trial judges. But part of the reason for the reversal rate, he said, is that the new judges are, well, new.
“New appellate judges are sometimes more hesitant to reverse unless a trial judge’s decision is plainly wrong, which is to be expected given that few new judges have prior experience with all of the many types of cases the courts hear,” Rutter said.
Plaintiffs’ lawyers have been aggravated for many years by the Texas appellate courts for what they claimed is a bias against jury verdicts, especially in cases that have large damages.
But the frustration expanded in recent years to businesses that have sued vendors or competitors for fraudulent activity only to see their courtroom victories snatched away by Republican-controlled appellate courts.
Last year, for example, the Dallas Court of Appeals unanimously reversed a $535 million jury award to pipeline giant Energy Transfer Partners against competitor Enterprise Product Partners. That case is on appeal to the Texas Supreme Court, which is also all Republican and viewed by legal experts as highly skeptical of plaintiff’s verdicts and large damage awards.
Rutter and Haynes and Boone associate Natasha Breaux spent several hundred hours combing through more than 1,600 decisions made by judges on the 14 courts of appeals in Texas.
“We were really trying to see which party is the happiest when the decision comes out,” Breaux said. “We read every single opinion.”
The study found that the plaintiffs winning cases thanks to reversals by the appellate judges are just as likely to be companies as individuals.
“We found that a significant number of cases being reversed as breach of non-disclosure agreements and breaches of other contractual agreements in which businesses are the plaintiffs,” Breaux said.
The Haynes and Boone data show that the courts of appeals in Houston reversed lower court decisions in one-third of the civil cases they decided, but the Dallas Court of Appeals overturned decisions only 20% of the time.
Appellate judges cited legal insufficiency in 63% of the reversals of jury verdicts, according to the study. Error in the jury charge was the reason 14% of the time.
A factual or evidence issue was cited in half of the summary judgments that were overturned, while an error in law was the reason 43% of the time.