Most Viewed Decisions

United States Court of Appeals, Fifth Circuit

City Of Dallas v. Delta Air Lines, 16-10051 (5th Cir. 02/02/2017)

Delta Airlines sought to use some of the 20 gates at Love Field. Although Delta was not party to the lease agreement the distributed the gates among airlines, the agreement provided for accommodations of non-parties. The City of Dallas selected United Airlines to share its gates because it was under the cap of 10 flights per day per gate, and Delta began operating flights. However, Southwest acquired United's two gates – giving Southwest 18 of the 20 – and later announced plans to use the full gates' capacity. The city rescinded the accommodation, intending to renegotiate an accommodation deal in light of the change. The city also sought a declaratory judgment as to its legal obligations; as part of the lawsuit, Delta sought injunctive relief preserving its status quo and Southwest sought injunctive relief prohibiting Delta from operating flights out of Love Field. The city then filed for a preliminary injunction requested the court to grant either of the airlines' request or any other relief the court found proper. The district court granted the city's motion by preserving the status quo in favor of Delta. Southwest appealed, challenging the court's finding that the city had a substantial likelihood of success on the merits. The appeals court found that Delta had properly requested all parties to seek accommodation, as required of non-parties under the contract; that the contract granted Southwest preferential but not exclusive use of the gates; and that the contract did not allow Southwest to obtain exclusive use by ramping up its own usage after an accommodation request was made. Thus, the court found that Southwest could have accommodated another carrier without "unduly interfering" with its own operations, as required under the lease agreement, and that the City could establish that Southwest breached the lease agreement by failing to do so. The court affirmed the trial court's judgment. City of Dallas v. Delta Airlines, Fifth Circuit, Case No. 16-10051, 2/2/17.

16-10051
W. EUGENE DAVIS, CIRCUIT JUDGE

Court of Appeals of Texas, Twelfth

Carrizo Oil & Gas, Inc. v. Barrow-Shaver Resources Company, 12-15-00083-CV (TexApp Dist 01/31/2017)

Appellee filed the instant action for breach of a consent-to-assignment provision in a farmout agreement. Appellant asserted that the negotiations and previous drafts informed the trial court that the reasonableness clause for the type of consent it would give had been removed and therefore it could withhold consent for any reason or for no reason. The trial court sided with appellee and, based on the parol evidence rule, did not allow evidence of the parties' negotiations or the four drafts of the farmout agreement to be admitted. As such, judgment was rendered against appellant for $27,690,466. In thirteen issues, appellant contended the trial court erred. The court reversed and rendered judgment that appellee take nothing holding negotiations of a contract can matter in determining whether it was silent on a material term. Here, the previous drafts and negotiations between the parties informed the court that the consent-to-assignment provision was not silent as to the type of consent. Further, the consent-to-assign language was unambiguous and Texas does not require reasonableness or good cause to withhold such consent. Further, the trial court erred in granting appellee's fraud cause of action as there was no evidence to support the element of justifiable reliance. Accordingly, the trial court's judgment was reversed. Carrizo Oil & Gas, Inc. v. Barrow-Shaver Resources Company, Tyler Court of Appeals, Case No.: 12-15-00083-CV, 01/31/2017

12-15-00083-CV
BRIAN HOYLE JUSTICE

Supreme Court of Texas

Nasser v. Liberty Mutual Fire Insurance Co., 15-0978 (TexApp Dist 01/27/2017)

Hurricane Ike damaged petitioner Elie and Rhonda Nasser's six-acre property in Richmond. Liberty Mutual paid several claims, but a dispute arose as to whether petitioners' 4,000-foot fence, which sustained at least $58,000 in damage, was covered under the "dwellings" or "other structures" sections of their policy. Under the latter, the limit of $24,720 would be significantly less than the actual damage. Petitioners sued Liberty Mutual for breach of contract, deceptive trade practices, and related charges. The trial court granted summary judgment for Liberty Mutual and the appeals court affirmed, finding the policy unambiguously defined "other structures" to include the fence. The Supreme Court found that an insurance policy is "ambiguous" if it is "genuinely subject to more than one meaning." Because the fencing was attached to the house on the property at various places, the court found that petitioners' reading of the "dwelling" portion of the policy to include the fence was reasonable. The court also found Liberty Mutual's interpretation unreasonable, which was that fencing necessarily had to be considered an "other structure" because part of the definition of "dwelling" was any structure "connected to the dwelling by fencing." The court found this reading would lead to absurd real-world scenarios. With only one reasonable interpretation, the Court held that the policy unambiguously favored petitioners. The Court reversed the appeals' court affirming of summary judgment and remanded to the trial court. Nasser v. Liberty Mutual Fire Insurance Co., Texas Supreme Court, No. 15-0978, 1/27/17.

15-0978
PAUL W. GREEN JUSTICE

Court of Appeals of Texas, First District

McLane Company, Inc. v. Texas Alcoholic Beverage Commission, 03-16-00415-CV (TexApp Dist 02/01/2017)

Appellant submitted a request for public information under Texas's Public Information Act. Appellee sought counsel from the attorney general as it wished to withhold portions of responsive records from disclosure. The attorney general issued a letter ruling stating appellee must release the requested information, with two exceptions. Appellee brought the underlying suit to challenge the decision wherein appellant intervened seeking mandamus relief ordering appellee to produce the requested information. Appellant also sought declarations and alleged appellee failed to comply with the PIA's requirements. Appellee filed a plea to the jurisdiction contending that sovereign immunity deprived the trial court of jurisdiction over appellant's claims; the trial court granted the pleas and this appeal followed. The court affirmed concluding that appellant's claims under the Uniform Declaratory Judgments Act did not waive appellee's sovereign immunity as the requests did not seek a declaration concerning the validity of the PIA or any other statute, rather a declaration of appellant's rights under the statute. The court noted that precedent from the supreme court, as well as this court, compelled the conclusion that the UDJA did not waive sovereign immunity for "bare statutory construction" claims. Further, the court concluded the trial court lacked jurisdiction to hear appellant's ultra vires claims under the redundant remedies doctrine. Because appellant can pursue relief through the PIA, any remedies it could obtain through an ultra vires suit would be redundant. Accordingly, the trial court's order was affirmed. McLane Company, Inc. v. Texas Alcoholic Beverage Commission, Austin Court of Appeals, Case No.: 03-16-00415-CV, 02/01/2017

03-16-00415-CV
SCOTT K. FIELD JUSTICE

Supreme Court of Texas

Crawford v. XTO Energy, 15-0142 (TexApp Dist 02/03/2017)

Petitioner Richard Crawford sued XTO Energy for breach of contract for failure to pay royalties on an oil-and-gas lease on a small strip of land (the Crawford tract). The land was surrounded by lots that his mother had conveyed years earlier; she reserved the oil and gas rights only beneath Crawford tract. When an XTO well began producing, XTO obtained a title order concluding that the share of royalties for the Crawford tract should go to the surrounding landowners under the strip-and-gore doctrine. XTO began paying the landowners, failed to pay petitioner, and petitioner sued. The trial court ruled that petitioner must join the landowners in his suit as necessary parties under Texas R. Civ. Pro. 39, eventually dismissing the suit, and the appeals court upheld the ruling. Petitioner argued before the Supreme Court that the adjacent landowners never claimed an interest, the landowners have no interest because the strip-and-gore doctrine does not apply, and the appeals court erred in holding that XTO's payments to the landowners created an interest. The Supreme Court denied Petitioner's strip-and-gore argument, siding with the appeals court's decision that the question of whether the landowners are necessary parties must be decided first. However, it agreed with petitioner's other arguments that they are not necessary parties. The court found that the landowners did not assert a claim in any way and noted that in relevant caselaw, parties asserted their rights by holding leases or filing suits. It also found that XTO had a legitimate concern that the landowners might sue when their royalties are reduced, but held that XTO cannot create a claim for the landowners by unilaterally deciding to pay them. Furthermore, it noted that XTO can address its concern by joining the landowners as proper (but not necessary) parties under Rule 37. The court reversed the appeals court's judgment and remanded. Crawford v. XTO Energy, Texas Supreme Court, Case No. 15-0142, 2/3/17.

15-0142
DEBRA H. LEHRMANN JUSTICE

Court of Appeals of Texas, First District

Wooters v. Unitech International, Inc., 01-15-00174-CV (TexApp Dist 01/26/2017)

Unitech International, which makes equipment for offshore oil exploration, fired and sued Chris Kutach and Jason Pennington, alleging the two stole trade secrets and otherwise breached their duties to Unitech in the process of attempting to start a competing company. Unitech also sued appellant Tim Wooters, Kutach's former boss at a previous company, who was involved in the startup. The jury cleared appellant of stealing trade secrets and converting Unitech's property, but found that he conspired with Kutach and Pennington to breach their fiduciary duty to Unitech. The jury also found against Kutach and Pennington, assessing damages of more than $7 million for which the three were jointly and severally liable. The appeals court found that Texas recognizes a claim for conspiracy to breach fiduciary duty, but it is a narrow one. The court found no conspiracy in the present case because, while Kutach and Pennington might have breached their employment contract with Unitech by planning to start a company, such an act is neither illegal nor a tort and appellant was not beholden to the contract. Furthermore, appellant was not a party to the two foremer employees' more brazen acts that would constitute a breach of fiduciary duty, such as possessing stolen Unitech property and breaking into the CEO's office. The court also found Unitech had no evidence appellant was aware of any unlawful acts. The appeals court reversed the trial court's judgment against appellant, entered judgment that Unitech take nothing from appellant, and affirmed the judgment in all other respects. Wooters v. Unitech International Inc., Houston 1st District Court of Appeals, Case No. 01-15-00174-CV, 1/26/17.

01-15-00174-CV
JANE BLAND JUSTICE

Court of Appeals of Texas, Fourteenth

Brown v. Hensley, 14-14-00981-CV (TexApp Dist 01/26/2017)

Plaintiff condominium owners sued association and board members to restore their homes after hurricane and fire damage. when complex was instead demolished,. Trial court granted summary judgment in favor of board members, and severed the remaining claims against the association. . In affirming, the court held that board members were immune from personal liability under § 84.004 of the Texas Charitable Immunity and Liability Act because they were volunteers rendering services for the association. "For immunity purposes, a person is acting within the scope of his authority if he is discharging the duties generally assigned to him even if the specific act is wrong or negligent." Dowdy v. Overton, No. 11-96-218-CV. The evidence established that board members were acting on behalf of the association as to decisions made relating to the property. Owners failed to demonstrate that any named board member took any action that constituted a tort or breach of a fiduciary or contractual duty. Moreover, owners could not demonstrate the existence of a genuine issue of material fact because the trial court struck their summary judgment evidence and owners did not challenge that ruling on appeal. Brown v. Hensley, Houston 14th Court of Appeals, Case No. 14-14-00981-CV, 1/26/2017

14-14-00981-CV
John Donovan Justice

United States Court of Appeals, Fifth Circuit

Heniff Transportation Systems v. Trimac Transportation Services, 16-40553 (5th Cir. 01/30/2017)

Appellant Heniff Transportation Services entered a contract to transport chemicals from Texas to Illinois, and hired Trimac Transportation to perform a thorough "Kosher wash" of its tanker as required by its contract. Trimac did not perform the wash correctly, the chemicals became contaminated, and appellant settled with its client for the resultant damage for nearly $239,000. Appellant sued Trimac for various state claims and a claim under the federal Carmack Amendment, which governs liability for losses incurred during the transportation phase of interstate commerce. The trial court held that the state claims were pre-empted by the Carmack Ammendment, and later granted summary judgment for Trimac on the Carmack claim. On appeal, appellant challenged the pre-emption ruling, arguing that although the amendment generally pre-empts state law claims against carriers in interstate commerce, Trimac was not a "carrier" covered by the amendment. The court found that the amendment by its plain language defines "carrier" broadly enough to include businesses that provide "services related to" interstate transportation, such as elevation, refrigeration, handling, packing, etc. The court rejected appellant's argument that Trimac was not covered because washing services were not specifically listed in the act. The court found that the Kosher wash was so critical to this transaction that the client specifically requested it under the contract; therefore, it was a related service. It also rejected appellant's argument that Trimac was not covered because it was not a party to appellant's bill of lading, finding that the plain language of the amendment did not require a bill of lading. The court held that the Carmack Amendment pre-empted appellant's state law claims and affirmed the trial court's dismissal. Heniff Transportation Systems v. Trimac Transportation Services, Fifth Circuit, Case No. 16-40553, 1/30/17.

16-40553
E. GRADY JOLLY,, CIRCUIT JUDGE

Supreme Court of Texas

Brady v. Klentzman, 15-0056 (TexApp Dist 01/27/2017)

The West Fort Bend Star published a story detailing Fort Bend County Sheriff Chief Deputy Craig Brady's improper efforts to help his underage son after a traffic stop that included alcohol. The son, petitioner Wade Brady, sued the newspaper and reporter LeeAnne Klentzman for libel and libel per se for printing, among other things, allegations that he was "unruly and intoxicated" during the stop. The jury found some statements in the article were untrue and found Klentzman acted with malice, although it relied on a definition of "malice" other than "knowledge of falsity or reckless disregard of the truth." The trial court assessed damages totaling $280,000. The appeals court reversed and remanded, holding that Brady bore the burden of proof that the statements were false and that he had to show knowledge of falsity or reckless disregard of the truth. Both sides petitioned the Supreme Court for review; Brady asking to affirm the trial court judgment and the newspaper and Klentzman on the grounds that the case should not have been reversed but not remanded. The Court first found that reporting misbehavior by public officials, and especially police officers, is a matter of public concern (Brawner v. City of Richardson, 855 F.2d 187, 191-92). It also found that a "logical nexus" existed between the public concern and individual statements in that article that Brady alleged were defamatory. Thus, Brady was required to prove falsity and actual malice – knowledge of falsity or reckless disregard for the truth – and the appeals court correctly reversed. However, it also found that the record showed some evidence that the story hurt Brady's reputation, making the damage award appropriate if Brady could prove libel, and therefore remand was proper. The Court affirmed the appeals court's judgment. Brady v. Klentzman, Texas Supreme Court, Case No. 15-0056, 1/27/17.

15-0056
John P. Devine Justice

Court of Appeals of Texas, Twelfth

Albertson’s Holdings, LLC v. Kay, 12-16-00181-CV (TexApp Dist 02/08/2017)

Ruth Kay was injured on the job at Albertson's. She sued appellants Alberton's and two contractors, claiming negligence, and husband Frank sued claiming loss of consortium. Appellants moved to compel arbitration pursuant to a workplace injury agreement Ruth had signed in 2010. The trial court denied the motion, finding that the agreement was unconscionable and that Frank was not bound by it. Appellants filed an interlocutory appeal, claiming that Frank was bound by the agreement, and that the Kays waived their defense that the agreement was unconscionable and unenforceable. Appellants argued Frank was bound by the agreement because Ruth signed as his agent, because he was a third-party beneficiary, and that his claim his derivative of Ruth's claim. The court found that marriage does not raise a presumption that one spouse is the agent of the other. It also found that Frank was a third-party beneficiary for death benefits and therefore is bound by the agreement only when making a death-benefit claim. It then found that although Frank's claim required him to prove that appellants were liable for Ruth's injuries, a loss of consortium claim is not "entirely derivative" of Ruth's negligence claim. However, the court also found that the agreement, despite granting appellants the right to approve a firm for arbitration, was not so one-sided as to be unconscionable because Ruth was allowed to participate in the process of choosing an arbitrator and Ruth showed no evidence of bias in the selection process. The court affirmed the trial court's order denying the motion to compel arbitration with Frank Kay, and reversed and remanded the order as to Ruth Kay. Albertson's Holding, LLC, v. Kay, Tyler Court of Appeals, Case No. 12-16-00181-CV, 2/8/17.

12-16-00181-CV
BRIAN HOYLE JUSTICE