With Friday’s orders list, the Texas Supreme Court issued two new decisions that will be important to the Texas tort bar. It also issued its decision on rehearing in the highly publicized Exxon well-plugging cases. And it cleaned up an earlier opinion without formally granting rehearing. (( The Court made minor changes to the opinion in Gilbert Texas Construction, L.P. v. Underwriters at Lloyd’s London, No. 08‑0246 (DB). Osler’s summary email describes them the minor changes this way: “Initialism (OCIP) removed on page 3 of original PDF; style and wording changes in footnote 8; ‘see also’ signal added in footnote 9; ‘see’ signal on Hartrick cite on page 25; and record and case cites on pages 27 and 30.” ))
New grant: How to calculate a landowner’s damages when the State takes only part of a piece of property
- The State of Texas v. Chris and Helen Petropoulos, No. 09‑0652 (DB). One issue is how to calculate damage to a landowner’s remaining property when the State has taken part of the land. The case is set for argument on February 1, 2011.
Rehearing in Exxon cases
In March 2009, the Court issued its original decisions in a set of Exxon cases alleging that the company had improperly plugged wells and had paid too little to some royalty holders. In November 2009, the Court granted rehearing and returned the cases to its pending docket. Today the Court issued two new opinions:
Exxon Corp. and Exxon Texas, Inc. v. Emerald Oil & Gas Co., L.C., No. 05‑0729 (DB). The Court made only minor changes to this opinion. In addition to a few sentence-level edits and cite improvements, the new opinion added a footnote in response to the rehearing motions clarifying who had standing to sue — “the royalty owners in this case have standing to sue, and they did sue, but too late for at least some of the causes of action. … Also, an assignee of the realty interest (at the time of the alleged damages) would have standing to sue…” The holding and judgment did not change.
Exxon Corp. and Exxon Texas, Inc. v. Emerald Oil & Gas Co., L.C. and Laurie T. Miesch, et al., No. 05-1076 (DB). The Court made some bigger changes here, while leaving most of the result the same.
As before, the Court found that most of the claims were time-barred. The Court’s discussion of the facts in this new opinion was greatly expanded, but the most meaningful change to the parties is in the judgment itself — the new opinion sends much of the case back to the court of appeals.
Here is how Chuck Lindell of the Statesman put it: “But in a new wrinkle, justices ordered the Corpus Christi appeals court to consider the O’Connors’ claims that Exxon acted fraudulently and breached its regulatory duty to properly plug the wells. The order, given with little additional direction, sent lawyers on all sides scrambling to understand the implications.”
That made me feel a little better. I had been staring at a redline comparison of the old and new opinions trying to find the meaningful changes.
And the opinion indeed says little about this. It notes that several appellate issues had originally been briefed in the court of appeals but — because of how the court of appeals decided things the first time — were never reached. Under Texas Rule of Appellate Procedure 53.4, a petitioner can bring these still-undecided questions before the Texas Supreme Court, which can choose whether to resolve them in the first instance or, instead, to remand them to the lower court. (( Rule 53.4: “To obtain a remand to the court of appeals for consideration of issues or points briefed in that court but not decided by that court, or to request that the Supreme Court consider such issues or points, a party may raise those issues or points in the petition, the response, the reply, any brief, or a motion for rehearing.” )) With its opinion on rehearing, the Court sent those issues back to the court of appeals for further proceedings.
As before, Justice Wainwright delivered both opinions for the Court and there were no separate opinions. Former Justice O’Neill did not sit before on either of these cases. In the new opinions, neither Justice Guzman nor Justice Lehrmann is participating.
Other coverage: “Exxon wins, again, in oil field sabotage case” (Austin American-Statesman)
The medical-malpractice statute covers factually-related tort claims, even if alleging generic negligence
Roy Kenji Yamada, M.D. v. Laura Friend, individually and as personal representative of the estate of Sarah Elizabeth Friend, deceased, and Luther Friend, individually, No. 08‑0262 (DDB)
This is another case about the boundaries of the medical-malpractice reform law. Here, the doctor was a consultant to an amusement park at which a small child died. The plaintiffs alleged that the park should have had ready access to a defibrillator and staff trained enough to use it. The claims against the doctor included both general negligence claims and claims alleging specific medical duties.
The court of appeals concluded that the claims about specific medical expertise were covered by the medical-malpractice law (and thus required an expert report) but that the more general negligence claims did not. The doctor filed a petition for review. The family did not and instead conceded in the Texas Supreme Court that at least some of the claims were covered by the statute.
Justice Johnson wrote the opinion of the Court, taking that concession as dispositive. The Court held that the two kinds of claims could not be split, and thus the statute covered any other claims arising from the same facts or occurrences. For that reason, the Court concluded that the purpose of the statute would be undermined if plaintiffs were permitted to choose to frame their claim in terms of everyday negligence instead of specialized medical knowledge.
Practice note: The result seems to be a kind of preemption of general negligence torts by the medical-malpractice statute. If this defendant had merely been a salesperson of medical gear, then it might be liable for precisely the same omissions. But because he sold consulting services as a medical doctor (and subject to even higher duties), he cannot be sued for mere negligence without also satisfying the heightened procedures for medical malpractice.
For those watching the Marks and Diversicare line of cases, this opinion by Justice Johnson roughly tracks his view in those cases that the identity of the defendant is what mattered to the Legislature, not the nature of the tort duty involved.
Federal preemption by regulatory silence and when a party in bankruptcy is a settling person under Chapter 33
MCI Sales and Service, Inc. v. James Hinton, individually and as representative of the estate of Dolores Hinton, deceased, et al., No. 09-0048 (DDB)
Dolores Hinton was one of five people killed in a rollover charter-bus accident near Waco. The bus driver was unable to make a quick stop, rolling over the vehicle, shattering the glass windows, and ejecting some passengers (who did not have seatbelts) through those windows. Her estate brought suit against the bus manufacturer and the charter-bus company.
The products-liability question on this appeal was whether the federal regulations applicable when this bus was manufactured preempted a state common-law negligence claim. As the Court summarized the regulations, they “neither required nor forbade passenger seatbelts” and “allowed manufacturers to choose between several types of glazing materials for use in the motorcoaches’ windows.” The state-law negligence theory here was that the manufacturer should have used seatbelts and should have chosen a different glazing material — both of which were permissible choices within the federal scheme.
Justice Guzman delivered the opinion of the Court, joined in full by seven Justices and in part by Chief Justice Jefferson. (Justice Green did not sit on this case.)
The opinion has an interesting discussion of whether the presumption against federal preemption applies in the traffic-safety context, distinguishing the Court’s preemption decision Geier v. American Honda Motor Co., 529 U.S. 861, 868 (2000), which had found preemption in the context of air bags. The opinion noted that it was adopting a different reading of Geier: “Commentators … concluded that the Geier majority upended the normal presumption against preemption. In view of the Supreme Court’s recent statements on the issue [in Wyeth v. Levine], we cannot agree.”
The court also noted what I think is an unusual split about this glazing-materials claim. It noted that the Fifth Circuit had previously analyzed a similar claim and found that it was not preempted under the statute. O’Hara v. General Motors Corp., 508 F.3d 753 (5th Cir. 2007). Meanwhile, the West Virginia Supreme Court had found a negligence theory based on these glazing materials to be preempted. At the least, those holdings break with stereotypes. Morgan v. Ford Motor Co., 680 S.E.2d 77 (W. Va. 2009). The Texas Supreme Court explained that the West Virginia decision was based on the reading of Geier that it was rejecting, and it therefore followed the Fifth Circuit in finding no preemption.
But even though the majority held that the tort claims were not preempted, it still concluded that the trial court’s judgment was infirm because it was based on an improper apportionment of liability under Chapter 33.
The operator of the bus line (Central Texas) had filed for bankruptcy after the accident, and its insurer had deposited the policy limits with the bankruptcy court. The bankruptcy court adopted a plan by which claimants could mediate their claims against the bus line and, if the bankruptcy court approved, could receive a distribution.
Before this process was complete, the trial in this case (against another defendant) went forward. At that time, it had not yet been adjudicated by the bankruptcy court whether Hinton would receive proceeds from the bankruptcy estate.
A majority of the Texas Supreme Court concluded that, nonetheless, the bus line operator should have been included as a “settling person” under Chapter 33 to potentially reduce the liability of the other defendants.
Chief Justice Jefferson delivered an opinion dissenting in this last part. He disagreed that the insurer’s payment of its policy limits to the bankruptcy court made it a “settling person” at the time this case was submitted to the jury. His point was that the statutory language looked to whether someone was a settling person “at the time of submission” and that, at that time, the bankruptcy court had not yet decided to award Hinton any funds at all. Although the court eventually did award funds to Hinton, in Justice Jefferson’s view, “those facts chronicle Hinton’s status after submission, which is irrelevant under the statute. The trial court appropriately viewed Hinton’s status at the time of submission, as no one could have known at that point whether Hinton would recover any of the remaining funds.”
Other coverage: “Supreme Court of Texas Holds Non-Binding Mediation Renders a Debtor a ‘Settling Person'” (Disputing)