Civil Case Law Update
2015 Collin County Bench Bar Conference
May 15-17, 2015
Martin E. Thornthwaite
What This Covers
1. Collin County Local Rules
2. Texas Rules of Evidence
3. Important Texas cases in 2014 and 2015
4. Proposed change to Texas court system
Collin County Local Rules
Self-Represented Litigants (Rule 1.2)
Electronic Recordings (Rule 1.3(c))
Document and Filing Requirements (Rule 2.2)
Applications for TRO and Other Ex Parte Orders (Rule 2.4)
Discovery Protective Order (Rule 2.5)
Certificate of Conference (Rules 3.3 and 3.4)
Service of Subpoenas on Non-litigant Government Officials
and Employees (Rule 3.6)
Motions to dismiss (Rule 91a)
Pretrial Conference (Rule 5.1)
Registry of the Court (Rule 7.3)
Self-Represented Litigants
Rule 1.2 – added
•Local Rules apply with equal force to self-represented litigants.
•Contact information to be provided to the District Clerk.
•Failure to accept delivery or pick up mail at designated address is
considered constructive receipt of the document.
–May be established by a postal service receipt for certified or
registered mail or comparable proof of delivery.
Electronic Recordings
Rule 1.3(c) – added
• No photos or electronic recordings of any kind are allowed in the
courthouse, unless specifically authorized by the Judge in
accordance with Texas Rule of Civil Procedure 18(c).
• Includes:
– Cell phones
– Camera phones
– iPads
Document and Filing Requirements
Rule 2.2– specifies format and content of court filings
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Descriptive title
Each page numbered and titled
Orders and judgments separated
One-inch margins
Signature blocks containing complete contact information
Compliance with TRCP 21c on sensitive data
No malware or viruses  E-filing constitutes a certification that the document has
been checked and is clear of any malware or viruses
Fiat filed as a separate Notice of Hearing
No combined filings
Multiple documents pertaining to a single filing combined in a single PDF with
bookmarks
Proposed orders filed as a subsequent filing/envelope
Constable service requests verified through the Collin County Interactive Map,
Precinct Finder at http://gismaps.collincountytx.gov.
TRO and Other Ex Parte Orders
Rule 2.4 – added
Notification Requirement
Party MUST notify and provide copy of application and proposed order
at least two (2) hours before presentment to the court
Two Exceptions:
Requires a verified certificate filed with the application
• Imminent irreparable harm + insufficient time to notify
• Notification would impair or annul the Court’s power to grant relief
because the subject matter of the application could be compromised
or property removed, secreted or destroyed
Discovery Protective Order
Rule 2.5 – new standard form
Available at:
http://www.co.collin.tx.us/district_courts/Documents/Local%20Rules
%20Protective%20Order%202014.pdf
Certificate of Conference
Rule 3.3 and Rule 3.4
• Certificate of Conference REQUIRED for non-dispositive motions
• Does not apply to
– Dispositive motions
– Motions for summary judgment
– Default judgments
– Motions for voluntary dismissal or nonsuit
– Post-verdict motions
– Motions involving service of citation
Service of Subpoenas on Certain
Non-Litigants
Rules 3.6– added
Applies to: Service of subpoena and subpoena duces tecum
Served on: Non-litigant government officials and employees
Requirements
• First: Contact representative and make “reasonable good faith inquiry” to identify
appropriate official or employee to serve
- Contact during regular business hours AND
- Contact at least 3 business days before subpoena is issued
• Second: Serve the subpoena with certificate detailing compliance with rule
Remedies available by court order
• Expenses, including attorney fees, paid to the person/entity opposing the subpoena
Pretrial Conference
Rule 5.1 – added
In all cases in which a jury fee has been paid…
The Court MUST conduct a pretrial conference prior to the selection of
the jury
Unless…
Otherwise agreed to by the parties or order of the Court.
Registry of the Court
Rule 7.3 – new model language for Orders releasing Registry Funds
“THE DISTRICT CLERK IS ORDERED TO ISSUE A CHECK PAYABLE
TO JANE MARIE DOE FOR AN AMOUNT EQUAL TO ALL FUNDS
PLUS ACCRUED INTEREST or THE PRINCIPLE AMOUNT OF
$_______, PLUS ACCRUED INTEREST.”
Waiver
Requires the express language:
“WAIVE THE THIRTY-DAY WAITING PERIOD”
Texas Rules of Evidence
• Non-Substantive Changes
• Substantive Changes
– Authentication of Business Records (TRE
902(10))
– Waiver of Privilege by Voluntary Disclosure
(TRE 511)
– Prior Statements of Witnesses: Impeachment
& Support (TRE 613)
Texas Rules of Evidence
Non-Substantive Changes
• Effective April 1, 2015
• Mirrors the 2011 amendments to the Federal Rules of Evidence
• Intended to make the rules easier to understand through clearer
language and a better format
• Rules will keep the same numbers
Texas Rules of Evidence
Substantive Changes Effective September 1, 2014
TRE 902(10) – Authentication of Business Records
• Before: Authentication requires notarized affidavit
• Now: Authentication requires opposing counsel be
served with the business records AND
– (a) an affidavit; OR
– (b) an unsworn declaration made under penalty of
perjury, at least 14 days before trial.
Texas Rules of Evidence
Substantive Changes Effective April 1, 2015
TRE 511 – Waiver of Privilege by Voluntary Disclosure
• Incorporates the provisions of Federal Rule of Evidence 502
– Only addresses disclosure of communications or information covered
by the lawyer-client privilege or work-product protection
– Does not affect the law governing waiver of other privileges or
protections.
TRE 613 – Prior Statements of Witnesses: Impeachment & Support
• Before: Witness must be first be given an opportunity to explain or deny in
order for the examining attorney to introduce extrinsic evidence
• Now: Still required but no longer part of examining attorney’s foundation
to introduce evidence
Civil Case Law
•Constitutional Law
– Defamation damages incurred by for-profit corporations
•Contracts
– Arbitration clauses between medical providers and patients
– Economic loss rule as applied to contractual strangers
•Corporations
– Shareholder oppression in closely-held corporations
•Employment Law
– Reporting requirements under the Texas Whistleblower Act
– Attorney’s fees under the Texas Labor Code
•Evidence
–Admissibility of seat belt evidence to limit plaintiff damages
–Framework for addressing evidence spoliation
•Insurance
–Limitation of “additional insured” coverage
Constitutional Law
Defamation Damages Incurred by For-Profit Corporations
Waste Management of Texas, Inc. v. Texas Disposal Systems Landfill,
Inc., 434 S.W.3d 142 (Tex. 2014).
• Issue: Whether there was sufficient evidence for a jury to award
reputation damages to a corporation.
• Rule: A corporation may recover reputation damages as noneconomic damages for purposes of the statutory cap on exemplary
damages.
Contracts
Arbitration Clauses
Arbitration Clauses Between Medical Providers and Patients
The Fredericksburg Care Co., L.P. v. Juanita Perez et al, No. 13-0573,
2015 Tex. LEXIS 221 (Tex. March 6, 2015).
• Issue: Whether the arbitration provision of the Health Care Liability
Act (“TMLA”) is preempted by the Federal Arbitration Act (“FAA”).
• Rule: The arbitration provision of the TMLA is generally preempted
by the FAA where the healthcare contract affects interstate
commerce, unless an exception applies.
– The McCarran-Ferguson Act does NOT exempt the TMLA from
preemption by the FAA.
Contracts
Economic Loss Rule
Economic Loss Rule As Applied to Contractual Strangers
Chapman Custom Homes, Inc. v. Dallas Plumbing Co., 445 S.W.3d 716
(Tex. 2014) vs. LAN/STV v. Martin K. Eby Constr. Co., Inc., 435
S.W.3d 234 (Tex. 2014).
Differences??
• Parties (owner vs. contractor)
• Claims (breach of the duty of good workmanship vs. negligent
misrepresentation)
• Damages (property vs. delay)
Corporations
Shareholder Oppression in Closely-Held Corporations
Ritchie v. Rupe, 443 S.W.3d 856 (Tex. 2014).
Issue: Whether the majority shareholders’ refusal to meet with potential buyers of a
minority shareholder’s interest constitutes shareholder oppression.
Rules
• Statutory claim available only under rehabilitative receiver statute in section 11.404
of the Texas Business Organizations Code
• “Oppression” requires the directors or manager to act:
(1) in abuse of authority over the corporation;
(2) with the intent to harm the interests of one or more shareholders;
(3) in a manner that does not comport with the honest exercise of their
business judgment; and
(4) in manner that creates a serious risk of harm to the corporation.
• NO common law cause of action
Employment Law
Reporting Requirements under the Texas Whistleblower Act
Tex. Comm’n on Envtl. Quality v. Resendez, 450 S.W.3d 520 (Tex. 2014).
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Issue: Whether the Texas Whistleblower Act applies to a government employee’s
report of wrongdoing up her chain of command and then to a state senator’s office.
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Rule: Internal reports of wrongdoing do not trigger the Whistleblower Act, even
where agency policy is to forward the reports to the agency’s enforcement arm.
Attorney’s Fees Under the Texas Labor Code
Bill Miller Bar-B-Q Enters. v. Gonzales, 2014 Tex. App. LEXIS 11796 (Tex. App.—San
Antonio Oct. 29, 2014, no pet.) (not designated for publication).
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Issue: Whether the reasonableness of statutory attorney fees is a fact question for the
jury’s determination.
Rule: The jury must decide the reasonableness of statutory attorney fees
 Circuit SPLIT
Evidence
Seat Belt Evidence
Admissibility of Seat Belt Evidence to Limit Damages
Nabors Well Servs., Ltd. v. Romero, No. 13-0136, 2015 Tex. LEXIS 142 (Tex. Feb. 13,
2015).
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Issue: Whether evidence that a plaintiff was not wearing a seat belt during a collision
is admissible to reduce her recovery.
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Rule: Seat belt evidence is admissible for the purpose of apportioning responsibility
under Texas’ proportionate responsibility statute if the defendant can establish that
the nonuse caused or contributed to cause the plaintiff’s injuries.
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But….
– Still limited by the Rules of Evidence  Must be relevant
• Relevant only if the defendant establishes that the nonuse caused or
contributed to cause the plaintiff’s injuries.
• Trial court should consider this outside the presence of the jury
– Cannot be used to establish failure to mitigate
Evidence
Spoliation
Framework for Addressing Evidence Spoliation
Brookshire Bros. v. Aldridge, 438 S.W.3d 9 (Tex. 2014).
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Framework - Competing concerns that spoliation can deprive the nonspoliating party
of relevant evidence and that spoliation remedies can shift the focus of the trial away
from the merits of the case.
First: Court - Party has spoliated evidence as a matter of law.
Second: The spoliation sanction must be
– (1) directed against the wrongful conduct and toward remedying any prejudice
suffered, and
– (2) no more severe than necessary to satisfy its legitimate purpose.
Third: The court should submit an instruction only if it finds (1) the spoliating party
acted with intent to conceal discoverable evidence, or (2) the spoliating party acted
negligently and caused the nonspoliating party to be irreparably deprived of any
meaningful ability to present a claim or defense.
– Intentional = Intent to conceal or destroy discovery evidence (including “willful
blindness”)
Insurance
Limitation of “Additional Insured” Coverage
In Re Deepwater Horizon, No. 13-0670, 2015 Tex. LEXIS 141 (Tex. Feb. 13,
2015).
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Issue: Whether a contractor’s status as an “additional insured” under an
insurance policy is limited by its assumption of liability under the terms of a
drilling contract such that it assumes liability for claims otherwise covered
under the language of the umbrella policies alone.
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Rule: The standard for determining the scope of coverage is based on the
language employed in the insurance policy. If the policy directs the court
elsewhere, the court will refer to an incorporate document to the extent
required by the policy. But to consider coverage limitations in underlying
transactional documents, the terms of the policy must obligate the court to
make such consideration.
Up Next?
H.B. 1603 Chancery Courts Bill
•Proposed bill would create new chancery courts in Texas
–Concurrent jurisdiction with district courts
•Derivative actions
•Actions related to qualified transactions
•Corporate governance
•Internal affairs
•Securities
•Trade Law
•Courts would feature judges with extensive expertise in business
•Goal: Enhance business-friendly environment to attract more
businesses to Texas
Civil Case Law Update
2015 Collin County Bench Bar Conference
May 15-17, 2015
Martin E. Thornthwaite