ACCEPTED 04-15-00327-CV FOURTH COURT OF APPEALS SAN ANTONIO, TEXAS 9/2/2015 1:16:16 PM KEITH HOTTLE CLERK
Case No. 04-15-00327-CV
FILED IN 4th COURT OF APPEALS In the Court of Appeals of Texas SAN ANTONIO, TEXAS Fourth District 09/2/2015 1:16:16 PM KEITH E. HOTTLE Clerk ERICK LOPEZ Appellant v. ADAM HURON D/B/A ADAM’S MEXICAN FOOD PRODUCTS Appellee
On Appeal from the th 224 Judicial District Court of Bexar County, Texas Hon. Cathleen M. Stryker, Presiding Trial Court Cause No. 2012-CI-18827
APPELLANT’S BRIEF OF ERICK LOPEZ
JEREMY J. COOK Texas Bar No. 24049709 DOWNS♦STANFORD, P.C. 2001 Bryan St., Suite 4000 Dallas, Texas 75201 Telephone: (214) 748-7900 Facsimile: (214) 748-4530 Email: jcook@downsstanford.com
Oral Argument Requested IDENTITIES OF PARTIES AND COUNSEL
Trial Plaintiff/Appellee: Adam Huron d/b/a Adam’s Mexican Food Products
Trial & Appellate Counsel for Adam Huron: Paul T. Curl Brittany M. Weil CURL & STAHL, PC 700 North St. Mary’s St Suite 1800 San Antonio, Texas 78205
First Trial Defendant: A.J. Plastics, Inc.
Trial Counsel for A.J. Plastics, Inc.: Lawrence L. Mealer LAW OFFICE OF LAWRENCE L. MEALER Maple Plaza Law Center 5353 Maple Avenue Suite 100 Dallas, Texas 75235
Appellate Counsel for A.J. Plastics, Inc.: n/a
Second Trial Defendant/Appellant: Erick Lopez
Trial Counsel for Erick Lopez: Mark R. Murphy Monica L. Ochoa DAVIS & SANTOS The Weston Centre 112 E. Pecan St., Suite 900 San Antonio, Texas 78205
Appellate Counsel for Erick Lopez: Jeremy J. Cook DOWNS & STANFORD, PC 2001 Bryan St, Suite 4000 Dallas, Texas 75201
i TABLE OF CONTENTS
Index of Authorities ..................................................................................... ii
Statement of the Case ................................................................................ v
Issues Presented .......................................................................................vii
Statement of Facts...................................................................................... 1
Summary of the Argument .......................................................................... 5
Argument .................................................................................................... 7
I. Appellant Is Not Liable To Appellee For the Plastic Bags ......... 7
A. CPRC 82.003 Applies To This Case................................ 7
B. Appellee Failed to Plead Or Prove Exception To § 82.003 ........................................................................ 12
C. Appellee Waived Any Right Of Recovery From Appellant .............................................................. 12
D. Conclusion..................................................................... 14
II. Appellant Is Not Liable For The Attorneys Fees Appellee Incurred Prosecuting His Claims Against Appellant ................ 14
III. Appellee’s Defensive Attorneys’ Fees Require Remand ......... 16
A. Appellee Was Required to Segregate............................ 16
B. Appellee Failed to Segregate ........................................ 18
C. Conclusion..................................................................... 19
ii Conclusion & Prayer ................................................................................. 20
Certificate of Compliance.......................................................................... 21
Certificate of Service................................................................................. 21
iii TABLE OF AUTHORITIES
Cases
Alonso v. Maytag Corp., 356 F.Supp.2d 757 (S.D. Tex. 2005).................................... 9, 10, 11, 12
Bogamy v. Harrison Cnty., No. 2:11-cv-88-JRG, 2012 WL 13557711 (E.D. Tex. Apr. 19, 2012) ......9
Casas v. The Tire Corral, Inc., ...................................................................... No. M-04-123, 2005 WL 6773889 (S.D. Tex. Mar. 31, 2005) ............... 11
City of Denton v. Page, 683 S.W.2d 180 (Tex.App.—Fort Worth 1985), reversed on other grounds, 701 S.W.2d 831 (Tex. 1986) ..................... 13
Garcia v. LG Electronics USA Inc., No. B-11-61, 2011 WL 2517141 (S.D. Tex June 23, 2011) .................... 9
Garcia v. Nissan Motor Co., No. M-05-59, 2006 WL 869944 (S.D. Tex. Mar. 30, 2006) ..................... 9
Green Int’l v. Solis, 951 S.W.2d 384 (Tex. 1997) ................................................................ 15
Integrated of Amarillo, Inc. v. Kirkland, 424 S.W.3d 131 (Tex.App.—Amarillo 2014, no pet.) ............................ 18
Ramos v. Frito-Lay, Inc., 784 S.W.2d 667 (Tex. 1990) ................................................................ 13
Selexman v. Ford Motor Co., No. H-14-1874, 2014 WL 6610904 (S.D. Tex, Nov. 20, 2014)................ 8
State Farm Lloyds v. Polaris Industrs., Inc., No. 6-12-19, 2012 WL 3985128 (S.D. Tex. Sept. 11, 2012) ................... 9
iv Tony Gullo Motors I, L.P. v. Chapa, 212 S.W.3d 299 (Tex. 2006) ..................................................... 16, 18-19
Statutes
TEX. BUS. & COMM. CODE § 17.50(d) ................................................... 14, 15
TEX. CIV. PRAC. & REM. CODE § 38.001 ................................................ 14, 15
TEX. CIV. PRAC. & REM. CODE § 82.001(2) .................................................. 11
TEX. CIV. PRAC. & REM. CODE § 82.001(3) .................................................... 7
TEX. CIV. PRAC. & REM. CODE § 82.003 ........................................................ 7
Rules
TEX. R. CIV. P. 279 .......................................................................... 7, 12, 13
v STATEMENT OF THE CASE
This is a product liability case involving plastic bags, in which
Appellee Adam Huron d/b/a Adam’s Mexican Food Products, as Plaintiff
below, sought money damages from A.J. Plastics, Inc., the manufacturer of
the allegedly defective bags, and Appellant Erick Lopez, the seller of the
bags.1 Appellant Lopez, by way of counterclaims, sought money damages
from Appellee relative to the time and expenses he committed to helping
Appellee obtain a patent and arrange for the purchase of plastic bags from
A.J. Plastics, Inc.2 One such counter-claim involved the Texas Theft
Liability Act (hereinafter “TLA”).3
The jury found that the plastic bags that A.J. Plastics, Inc.
manufactured and that Appellant provided to Appellee were not fit for the
ordinary purposes for which they were to be used and were not suitable for
a particular purpose of which Appellant had reason to know, but rejected all
other claims against Appellant.4 The jury found Appellee’s damages to be
$16,199.07, and apportioned 80% of the responsibility for Appellee’s
damages to A.J. Plastics, Inc., and 20% to Appellant.5
1 C.R. 1-6. 2 C.R. 7-14. 3 C.R. 12. 4 C.R. 19-24, 27-28. 5 C.R. 29.
vi The jury rejected Appellant’s counterclaims6 and found Appellee’s
trial attorneys’ fees to be in the amount of $30,000 for the prosecution of
his affirmative claims against both defendants7 and $20,000 for the defense
of Appellee against Appellant’s TLA counter-claim.8 The jury also found
that any appeal of Appellee’s affirmative claims would cost Appellee up to
$54,000 in appellate attorneys’ fees and any appeal of Appellant’s TLA
counter-claim would cost Appellee up to an additional $54,000 in appellate
attorneys’ fees.9
On March 4, 2015, the Trial Court issued a Judgment consistent with
the Jury’s findings.10
6 C.R. 18, 31-44. 7 C.R. 30. 8 C.R. 42. 9 C.R. 30, 42. 10 C.R. 48-53.
vii ISSUES PRESENTED
1. Did the trial court err in issuing a judgment that holds Appellant Erick Lopez liable to Appellee for damages caused by defective plastic bags where Appellee neither pleaded, nor proved, nor obtained a jury finding that Appellant’s conduct falls within at least one of the exceptions in the “Non-Manufacturing Sellers Rule of Non-Liability” set out in Section 82.003 of the Texas Civil Practice and Remedies Code?
2. If the answer to Issue No. 1 above is “yes,” did the trial court err in issuing a judgment that holds Appellant Erick Lopez liable in the amount of $30,000 for the attorney’s fees that Appellee has incurred and continues to incur relative to the prosecution of his affirmative claims?
3. Did the trial court err in issuing a judgment that holds Appellant Erick Lopez liable to Appellee in the amount of $20,000 for the attorney’s fees that Appellee allegedly incurred defending himself against Appellant’s TLA counter-claim?
The following sub-issues are key to this issue:
a. Was Appellee required to offer evidence segregating the attorneys’ fees he incurred at the trial court (and may incur at the appellate levels) defending himself against Appellant’s TLA counter-claim from those attorneys’ fees he incurred at the trial court (and may incur at the appellate levels) defending himself against Appellant’s other counter-claims, as to which Texas law does not allow for the shifting of attorneys’ fees onto the non- prevailing party?
b. If the answer to Issue No. 3a above is “yes,” did Appellee present sufficient testimony of segregation relative to his trial court and/or appellate level attorneys’ fees?
viii STATEMENT OF FACTS
Appellee makes and sells pre-formed gorditas and masa for making
tamales, which he sells and distributes in plastic bags that he purchases.11
In April 2009, Appellee called Appellant and asked that he assist him
in obtaining plastic bags for his business.12 Appellant and Appellee
reached an agreement that Appellant would provide Appellee with plastic
bags.13
Appellee told Appellant the specifications for the bags he needed,
including the quantity, size, colors, length, width and thickness of the plastic
to be used.14 Appellant made no express representations or warranties to
Appellee about the plastic bags.15
Appellee knew that Appellant was going to have someone else
manufacture the plastic bags, and Appellant never manufactured a single
plastic bag.16 In the June-August 2010 timeframe, Appellant contacted and
passed Appellee’s specifications to A.J. Plastics, Inc.,17 which then
manufactured the bags that Appellant ordered for Appellee.18
11 R.R. Vol. 2, at 29:1-6; RR. Vol. 3, at 50:12-19. 12 R.R. Vol. 3, at 53:13-22, 249:6-20. 13 R.R. Vo. 3, at 85:25 – 86:8, 163:1-5. 14 R.R. Vol. 3, at 54:1 – 56:9, 86:9 – 87:14. 15 R.R. Vol. 3, at 136:7 – 137:12; R.R. Vol. 4, at 78:11 – 79:15; C.R. at 7, 8. 16 R.R. Vol. 3, at 56:16-23, 102:17 – 103:2; R.R. Vol. 4, at 79:16-18. 17 R.R. Vol. 4, at 83:17 – 84:1, 85:8-10, 17-20. 18 R.R. Vol. 4, at 85:8-10, 17-20; R.R. Vol. 2, at 218:4-10.
1 From late 2010 through July 2011, pursuant to orders placed by
Appellant, A.J. Plastics, Inc. sent several shipments of plastic bags that it
had manufactured directly to Appellee.19
In November 2011, H-E-B, the grocery store chain, contacted
Appellee and advised that a shipment of 1,695 cases of Masa Preparada,
which H-E-B had purchased from Appellee, was defective in that many of
the bags containing the masa were breaking at their seams. 20 H-E-B
returned the entire shipment to Appellee, and Appellee replaced the
shipment.21 According to Rene Huron, Appellee’s plant manager, 22 he
inspected the returned shipment and found that the spilling of the masa out
of the bags caused the masa to dry up, spoil and become inedible, 23 and,
therefore, Appellee discarded or gave away (to farmers and others with
animals) the entire returned shipment.24
H-E-B paid Appellee $19,373.85 for the shipment that was eventually
replaced.25
19 R.R. Vol. 7, Exs. 2 and 3; R.R. Vol 4, at 44:1-25, 48:9-18; R.R. Vol. 2, at 71:5-8, 233:10-18. 20 R.R. Vol. 2, at 156:23 – 160:5, 48:8-24; 49:3-15. 21 R.R. Vol. 2, at 164:1 – 165:4, 166:16-21, 55:23-25. 22 R.R. Vol. 2, at 29:23-25. 23 R.R. Vol. 2, at 46:12-21, 50:16 – 51:5; 52:10-14; 54:8 – 55:10. 24 R.R. Vol. 2, at 55:2-22. 25 R.R. Vol. 2, at 48:25 – 49:2.
2 Appellee claimed that replacing the defective shipment harmed him in
the amount of $24,428.90, in which he included $19,373.85 for the “cost of
the shipment to H-E-B” or the “merchandise return,” $4,355.05 in overtime
wages paid to his employees to repack the new shipment, and $700 in
shipping costs.26 Appellee’s overhead in producing a shipment of masa is
“80, 90%,” so that his profit margin is only 10%. 27
As of January 15, 2015, Appellee had incurred $49,965.08 in
attorneys’ fees, court costs and litigation expenses. 28 Appellee’s attorney,
Paul Curl, who testified on the issue of Appellee’s attorneys’ fees, indicated
that as he was calculating Appellee’s total fees at the trial court level, which
would include the not-then-billed time and expense of the trial itself, he
stopped calculating when he reached the sum of $70,000, “because the
fees… [were] out of wack,” and so he “leveled off… cut the fees to
$50,000.00.”29 Without a basis, Mr. Curl then “attributed” $30,000 of the
$50,000 to Appellees’ claims against the defendants and the remaining
$20,000 to the defense of Appellee against Appellant’s counter-claims.30
26 R.R. Vol. 2, at 55:23 – 60:5, 60:21 – 62:13. 27 R.R. Vol. 3, at 115:8 – 116:13. 28 C.R. Vol. 6, Exhibit 18. [NOTE: Plaintiff’s counsel’s Invoice dated June 14, 2013 reflects payments from Appellant and A.J. Plastics, Inc. in the amounts of $1,000.00 and $900.00, respectively.] 29 R.R. Vol. 3, at 196:16 – 199:8. 30 R.R. Vol. 3, at 198:22 – 199:8.
3 Mr. Curl did not go through his firm’s billing entries and determine the
claim(s) to which each entry applied.31 Mr. Curl opined that it was
impossible to segregate the attorneys’ fees Appellee incurred that were
attributable to the defense of Appellant’s separate counter-claims, on the
basis that “the facts are closely intertwined” and “the work required to
defend each of those claims advances the defense of all other claims.” 32
Consistent with this opinion, Appellee offered no evidence of any kind
segregating his non-recoverable defensive fees from his TLA defense fees.
Appellee filed his initial petition against Appellant on November 20,
2012, Appellant did not file his TLA counter-claim until August 21, 2013,
and Appellee did not file his (only) answer to Appellant’s counter-claims
until October 30, 2014.33 Within Appellee’s attorney fee invoices there are
only three time entries in which Appellant’s counter-claims are expressly
referenced, and two of them include multiple tasks so that it is impossible to
ascertain how much time was spent on the counter-claims.34 No single
time entry expressly references the TLA or the TLA counter-claim.35
31 R.R. Vol. 3, at 210:20 – 211:5. 32 R.R. Vol. 3, at 209:2-11. 33 C.R. at 67, 70 & 71. As of August 21, 2013, the date on which Appellant first filed his TLA counter-claim, Appellee had already incurred $12,134.74 in attorneys’ fees, costs and expenses, none of which could possibly relate to the TLA counter-claim. 34 R.R. Vol. 6, at Exhibit 18, at Bates numbers P0169, P0195 and P0277. 35 R.R. Vol. 6, at Exhibit 18.
4 SUMMARY OF THE ARGUMENT
The trial court erred in issuing a judgment that holds Appellant liable
to Appellee for a 20% portion of the damages he incurred as a result of the
defective plastic bags, because Appellee neither pleaded, nor proved, nor
obtained a jury finding that Appellant’s conduct falls within one of the
enumerated exceptions set forth in the “Non-Manufacturing Sellers Rule of
Non-Liability” found in Section 82.003 of the Texas Civil Practice and
Remedies Code.
Because Appellee cannot recover against Appellant on his breach of
warranty claims, he also cannot recover against Appellant for the attorneys’
fees he incurred in prosecuting his breach of warranty claims against
Appellant.
This Honorable Court of Appeals should reverse and render that
portion of the trial court’s judgment that holds Appellant liable to Appellee
for a portion of the damages he incurred due to the defective plastic bags
and that potion of the judgment that holds Appellant liable to Appellee for
the attorneys’ fees he incurred at the trial court and may incur at the
appellate levels prosecuting his affirmative claims against Appellant and
A.J. Plastics, Inc.
5 The trial court also erred in issuing a judgment that holds Appellant
liable to Appellee for the attorneys’ fees he incurred at the trial court
defending himself against Appellant’s TLA counter-claim, because Appellee
presented no evidence segregating his TLA defense fees from his other
defense fees.
This Honorable Court of Appeals should reverse that portion of the
trial court’s judgment that holds Appellant liable for the attorneys’ fees that
Appellee incurred defending himself against Appellant’s TLA counter-claim
and remand that issue back to the trial court for a hearing at which the
appropriate value of Appellee’s recoverable attorneys’ fees can be
determined subject to a proper segregation of Appellee’s defensive
attorneys’ fees.
6 ARGUMENT
I. Appellant Is Not Liable To Appellee For The Plastic Bags
Appellee neither pleaded, nor proved, nor obtained a jury finding that
Appellant’s conduct falls within at least one of the enumerated exceptions
in the “Non-Manufacturing Seller’s Rule of Non-Liability” found at Section
82.003 of the Texas Civil Practice and Remedies Code. As such, pursuant
to Rule 279 of the Texas Rules of Civil Procedure, Appellee has waived
any recovery from Appellant.
A. CPRC 82.003 Applies To This Case
Under Section 82.003 of the Texas Civil Practice and Remedies
Code, “[a] seller that did not manufacture a product is not liable for harm
caused to the claimant by that product unless the claimant proves” one of
seven enumerated exceptions.36 Under Chapter 82, “seller” is defined as
“a person who is engaged in the business of distributing or otherwise
placing, for any commercial purpose, in the stream of commerce for use or
consumption a product or any component part thereof.”37
36 TEX. CIV. PRAC. & REM. CODE § 82.003. 37 Id. at § 82.001(3).
7 In this case, Appellee pleaded, proved and obtained a jury finding
that Appellant was a seller or merchant of the plastic bags. 38 Further, at
trial, Appellant testified that he “never” manufactured a plastic bag.39 Also,
manufacture the plastic bags,40 and there was no evidence presented at
trial that would suggest, even slightly, that Appellant manufactured the
bags of which Appellee complained. Based upon the plain language of
Section 82.003, it cannot be reasonably argued in this Appeal that
Appellant is not a “non-manufacturing seller” who cannot be held liable to
Appellee unless Appellee obtained a finding that Appellant’s conduct falls
within one of Section 82.003’s enumerated exceptions.
Further, case law supports the application of Section 82.003 to
Appellee’s claims against Appellant. In Selexman v. Ford Motor Co., the
U.S. District Court for the Southern District of Texas denied Selexman’s
motion for remand, concluding that because he had not pleaded any
exception under Section 82.003 against the dealership that had sold him
the allegedly defective car, there was no reasonable basis to predict that he
could prevail on his negligence claims against the dealership.41
38 C.R. at 23. 39 R.R. Vol. 4, at 79:16-18. 40 R.R., Vol. 3, at 56:16-23, 102:17 – 103:2. 41 No. H-14-1874, 2014 WL 6610904 (S.D. Tex, Nov. 20, 2014)(slip copy).
8 In reaching its decision, the Selexman Court cited to State Farm
Lloyds v. Polaris Industrs, Inc., in which the same court had, just two years
earlier, denied remand to State Farm on the basis that State Farm had
pleaded no viable cause of action against the dealership-defendant that
had sold the vehicle to State Farm’s subrogor-insured and then serviced it
afterward.42 In so holding, the court acknowledged that “Texas federal
courts have held that any theory of recovery pleaded against a
nonmanufacturing seller must satisfy one of the seven immunity exceptions
contained in section 82.003(a), even if the allegations would otherwise
state a valid claim under Texas law.”43
Appellee may argue that the decision in Alonso v. Maytag Corp.44
supports his position that Section 82.003 is inapplicable to his claims
against Appellant. If so, Appellee’s reliance on Alonso will be misplaced.
42 No. 6-12-19, 2012 WL 3985128 (S.D. Tex. Sept. 11, 2012). 43 Id. at *2 (citing Alonso v. Maytag Corp., 356 F.Supp.2d 757, 761 (S.D. Tex. 2005), Garcia v. Nissan Motor Co., No. M-05-59, 2006 WL 869944, at *6 (S.D. Tex. Mar. 30, 2006) and Bogamy v. Harrison Cnty., No. 2:11-cv-88-JRG, 2012 WL 13557711, at *3 (E.D. Tex. Apr. 19, 2012))(emphasis added); see also Garcia v. LG Electronics USA Inc., No. B-11-61, 2011 WL 2517141, at *2 (S.D. Tex June 23, 2011)(“Specifically, section 82.003 provides blanket protection for nonmanufacturing sellers of products from liability for injuries caused by a defective product unless one of the specified exceptions apply.” (emphases added)). 44 356 F.Supp.2d 757 (S.D. Tex. 2005).
9 In Alonso, the U.S. District Court for the Southern District of Texas
granted the plaintiffs’ motion to remand, holding that remand was required
even though the plaintiffs’ strict products liability and negligence causes of
action were not viable since the plaintiffs had not pleaded any of the
exceptions in Section 82.003, given that the plaintiffs had pleaded that the
venue defendants committed certain “false, misleading, or deceptive acts”
under Section 17.46(b) of the Texas DTPA and Maytag had failed to offer
any evidence to challenge those factual allegations.45
Even though Appellee, like the Alonso plaintiffs, did allege and seek
to prove DTPA claims against Appellant, Alonso is meaningfully
distinguishable. While the Alonso plaintiffs and Appellee pleaded “false,
misleading and deceptive acts” under Section 17.46(b) of the Texas DTPA,
Appellee herein failed to obtain an affirmative jury finding that Appellant
committed the alleged acts.46 Further, while the Alonso plaintiffs did not
allege any breach of an implied warranty, Appellee proved only that
Appellant had breached the implied warranties of fitness for ordinary
purposes and fitness for a particular purpose.47
45 Id. at 762. 46 See C.R. at 21, Jury’s Verdict, Question No. 4, answered “no.” 47 See id. at 9-10, Jury’s Verdict, Questions 6B and 7, both answered “yes.” Notably, Appellee failed to obtain a jury finding that Appellant had breached an express warranty. (C.R. at 8).
10 Further, Alonso’s reasoning itself supports the application of Section
82.003 to Appellee’s claims against Appellant. In determining that the
plaintiffs had no viable strict products liability or negligence claims against
the venue defendants, the Alonso Court specifically reviewed the definition
of “products liability action” in Section 82.001. 48 The court noted that “strict
products liability” and “negligence” are specifically included in Chapter 82’s
definition of “products liability action,” and, therefore, Section 82.003
applied to the plaintiffs’ strict products liability and negligence claims and
the plaintiffs could only recover on such claims if they proved at least one
of the exceptions in Section 82.003.49
Importantly, the phrase “breach of express or implied warranty” is
also expressly included in Chapter 82’s definition of “products liability
action.”50 As such, under the logic in Alonso, Appellee was required to
prove an exception within Section 82.003 in order to recover on his breach
of warranty claims against Appellant.
48 Alonso, 356 F.Supp.2d at 761; see also Casas v. The Tire Corral, Inc., No. M-04-123, 2005 WL 6773889, at *2 (S.D. Tex. Mar. 31, 2005)(acknowledging that section 82.003 applied to plaintiffs’ claims against the venue defendant, including breach of warranty, given that the claims “are encompassed in the definition of a ‘products liability action’ under § 82.001.”). 49 Alonso, 356 F.Supp.2d at 761. 50 TEX. CIV. PRAC. & REM. CODE § 82.001(2).
11 B. Appellee Failed To Plead Or Prove Exception To § 82.003
Appellee failed to meet his burden of pleading, proving and obtaining
a jury finding that Appellant’s conduct falls within at least one of the
enumerated exceptions to immunity under Section 82.003.51
C. Appellee Waived Any Right Of Recovery From Appellant
Rule 279 of the Texas Rules of Civil Procedure states that “[u]pon
appeal all independent grounds of recovery or of defense not conclusively
established under the evidence and no element of which is submitted or
requested are waived.”52 Rule 279 then adds the following exception:
When a ground of recovery… consists of more than one element, if one or more of such elements necessary to sustain such ground of recovery…, and necessarily referable thereto, are submitted to and found by the jury, and one or more of such elements are omitted from the charge, without request or objection, and there is factually sufficient evidence to support a finding thereon… such omitted element or elements shall be deemed found by the court in such manner as to support the judgment.53
51 C.R. at 1-6, 15-47. 52 TEX. R. CIV. P. 279. 53 Id.
12 Here, Appellant contends that the requisite elements to prove an
exception within Section 82.003 stand alone, such that Appellee’s failure to
obtain any finding as to any such element constitutes a full waiver of any
right of recovery against Appellant.
Appellee may argue that the elements to prove an exception within
Section 82.003 should be viewed as “additional” and omitted elements that
Appellee was required to prove in order to recover on his breach of implied
warranty claims, such that Appellee is entitled under Rule 279’s exception
to have such omitted elements deemed as having been found by the trial
court. If so, this argument will be without merit.
In Ramos v. Frito-Lay, Inc., the Supreme Court of Texas
acknowledged that “[w]here… issues are omitted which constitute only a
part of a complete and independent ground and other issues necessarily
referable to that ground are submitted and answered, the omitted elements
are deemed found in support of the judgment if no objection is made and
they are supported by some evidence.”54 Appellant acknowledges that
“[s]uch a deemed finding need not be supported by a preponderance of the
evidence but only by ‘some evidence’.”55
54 784 S.W.2d 667, 668 (Tex. 1990)(emphasis added). 55 City of Denton v. Page, 683 S.W.2d 180, 205 (Tex.App.—Fort Worth 1985), reversed on other grounds, 701 S.W.2d 831 (Tex. 1986).
13 Thus, to invoke the exception, Appellee must show that there was at
least some evidence meeting an exception of Section 82.003.
This he cannot do. At trial, there was no evidence, i.e., no more than
a scintilla of evidence, presented that would show that Appellant’s conduct
relative to the provision of the subject plastic bags falls within one of the
exceptions within Section 82.003. As such, Appellee is not entitled to have
the omitted elements of any exception deemed as having been found to
support the judgment.
D. Conclusion
Based on the foregoing, this Honorable Court should reverse that
portion of the judgment holding Appellant liable to Appellee for a portion of
the damages he incurred due to the defective plastic bags and render that
Appellee take nothing from Appellant in that regard.
II. Appellant Is Not Liable For The Attorneys’ Fees Appellee Incurred Prosecuting His Claims Against Appellant
Appellee sought to recover the attorneys’ fees he incurred
prosecuting his affirmative claims against both trial defendants under
Section 38.001 of the Texas Civil Practice and Remedies Code and
Section 17.50(d) of the Texas Business and Commerce Code.56
56 C.R. at 4.
14 Section 38.001 and Section 17.50(d) both required that Appellee
prevail on his claims in order to recover attorneys’ fees.57
Because Appellee has not recovered on any claim listed among
those in Section 38.001, he cannot recover attorneys’ fees from Appellant
under that statute. Likewise, because Appellee failed to plead, prove or
obtain a jury finding meeting an exception within Section 82.003 and,
therefore, (as argued above) cannot prevail on his breach of warranty
claims against Appellant, he is unable to recover attorneys’ fees from
Appellant under Section 17.50(d) of the Texas DTPA.
Based on the foregoing, this Honorable Court should reverse that
portion of the judgment holding Appellant liable to Appellee for the
attorneys’ fees he incurred at trial and may occur in this Appeal pursuing
his claims against Appellant and render that Appellee take nothing from
Appellant in that regard.
57 TEX. CIV. PRAC. & REM. CODE S 38.001 (stating, “A person may recover reasonable attorney’s fees… in addition to the amount of a valid claim and costs, if the claim is for” one of several types of claims. (emphasis added)); TEX. BUS. & COMM. CODE S 17.50(d) (stating, “Each consumer who prevails shall be awarded court costs and reasonable and necessary attorneys’ fees.” (emphasis added)); see also, Green Int’l v. Solis, 951 S.W.2d 384, 390 (Tex. 1997)(stating, “To recover attorneys’ fees under §38.001, a party must (1) prevail on a cause of action for which attorney’s fees are recoverable, and (2) recover damages.”(emphases added)).
15 III. Appellee’s Defensive Attorneys’ Fees Require Remand
Despite his obligation to do so, Appellee presented no evidence
segregating the attorneys’ fees he incurred defending himself against
Appellant’s TLA counter-claim (which allows fee-shifting to the prevailing
party) from those he incurred defending himself against Appellant’s other
counter-claims (which do not allow fee-shifting). As such, this Honorable
Court should reverse that portion of the trial court’s judgment holding
Appellant liable for $20,000 to Appellee relative to his un-segregated
defensive attorneys’ fees and remand the issue of Appellee’s recoverable
defensive attorneys’ fees to the trial court for a hearing on same.
A. Appellee Was Required To Segregate
In the seminal case of Tony Gullo Motors I, L.P. v. Chapa, the
Supreme Court of Texas remanded the issue of the plaintiff’s recoverable
attorneys’ fees back to the Beaumont Court of Appeals, stating as follows:
[W]e reaffirm the rule that if any attorney’s fees relate solely to a claim for which fees are unrecoverable, a claimant must segregate recoverable from unrecoverable fees. Intertwined facts do not make tort fees recoverable; it is only when discrete legal services advance both a recoverable and unrecoverable claim that they are so intertwined that they need not be segregated.58
58 212 S.W.3d 299, 313-14 (Tex. 2006)(emphasis added).
16 The evidence Appellee presented at trial on the issue of his attorneys’
fees consisted of invoices from his counsel and Attorney Curl’s testimony.59
Many of the time entries in the invoices are so general in content that it is
impossible to determine whether they relate to Appellant’s TLA counter-
claim. Moreover, only three of the time entries from the invoices reference
the counter-claims, two of them include other tasks and give no indication
as to how much time was spent on the counter-claims, and no single time
entry specifically references the TLA or Appellant’s TLA counter-claim.60
As a result, a review of the invoices provides no support for the argument
that every discrete defensive legal service contained in the invoices
advanced a defense for Appellee against all of Appellant’s counter-claims.
Mr. Curl’s testimony is also of little support to the argument. First, he
admits that he did not review each of the time entries in the invoices to
determine the claim(s) to which they applied.61 Second, his opinion that the
defense against one of the counter-claims advanced a defense of all of
them is entirely conclusory, without any explanation.62
59 R.R. Vol. 3, at 190:20 – 212:20; R.R. Vol. 6, at Ex. 18. 60 R.R. Vol. 6, at Exhibit 18, at Bates numbers P0169, P0195 and P0277. 61 R.R. Vol. 3, at 210:20 – 211:5. 62 R.R. Vol. 3, at 209:2-11; see also Integrated of Amarillo, Inc. v. Kirkland, 424 S.W.3d 131, 135 (Tex.App.—Amarillo 2014, no pet.)(“[E]ven if admitted without objection, an expert's bare unsupported conclusion amounts to no evidence and will not support a judgment.”)(citations omitted).
17 Moreover, as in Chapa, when Appellee’s attorneys were drafting his
pleadings in response to the non-TLA counter-claims and drafting or
reviewing proposed questions in the jury charge relating to the non-TLA
counter-claims, “there is no question those fees were not recoverable.”63 It
is, therefore, indisputable that some, if not much, of Appellee’s defensive
attorneys’ fees were incurred for legal services having nothing to do with
Appellant’s TLA counter-claim. As such, segregation was required.
B. Appellee Failed To Segregate
In Chapa, the supreme court explained that the Texas standard
regarding segregation “does not require more precise proof… than for any
other claims or expenses… [and] an opinion would have sufficed that, for
example, 95 percent of [counsel’s] drafting time would have been
necessary even if there had been no fraud claim.”64
Despite the relatively lenient standard, Mr. Curl failed to offer any
explanation or discussion on the percentage of the time and effort put
toward the TLA counter-claim, choosing instead to stand on his conclusory
opinion that segregation of the defensive fees was impossible and, thus,
not required.65 Consistent therewith, when testifying on the issue of
63 212 S.W.3d at 313. 64 Id. at 314. 65 R.R. Vol. 3, at 209:2-10.
18 appellate attorneys’ fees, Mr. Curl offered no opinions, explanation or
discussion as to what an appeal of the TLA counter-claim would cost
Appellee by way of attorneys’ fees when compared to what an appeal of
the non-TLA counter-claims would cost him.66
C. Conclusion
Because Appellee failed to meet his burden of presenting his trial and
appellate defensive attorneys’ fees in segregated figures, this Honorable
Court should reverse that portion of the trial court judgment holding
Appellant liable for Appellee’s unsegregated defensive attorneys’ fees and
remand that issue back to the trial court for a hearing on same subject to a
proper segregation.
66 R.R. Vol. 3, at 204:2 – 206:8.
19 CONCLUSION & PRAYER
Based upon the plain language of Section 82.003 and the case law
discussed and cited herein, Appellee was required to plead and prove an
exception in Section 82.003. Appellee did not do that, and, therefore, the
trial court erred in holding Appellant liable to Appellee for a portion of his
damages caused by the defective plastic bags. As a result, the trial court
judgment should be reversed to the extent that it holds Appellant liable to
Appellee relative to the plastic bags and to the extent that it holds Appellant
liable to Appellee for the $30,000 that Appellee incurred in attorneys’ fees
prosecuting his claims against Appellant. It should then be rendered that
Appellee take nothing from Appellant in these regards.
The trial court judgment should also be reversed to the extent that it
holds Appellant liable for the $20,000 that the jury found Appellee had
incurred defending himself against Appellant’s TLA counter-claim, because
Appellee failed to present any evidence segregating his recoverable
defensive attorneys’ fees from his non-recoverable defensive attorneys’
fees. This Honorable Court should remand the issue of Appellee’s
recoverable defensive fees to the trial court so a hearing can be held to
determine same subject to an appropriate segregation by Appellee.
20 Certificate of Compliance
Pursuant to Rule 9.4(i) of the Texas Rules of Appellate Procedure, I hereby certify that this brief contains 4,151 words (exclusive of the portions exempted from the rule).
Signed on the 2nd day of September, 2015.
/s/ jeremy j. cook JEREMY J. COOK
Certificate of Service
The undersigned certifies that a copy of this brief was served on the following counsel via e-filing in accordance with Rule 9.5 of the Texas Rules of Appellate Procedure and this Court’s Local Rules, on the 2nd day of September, 2015:
Trial and Appellate Counsel for Appellee Adam Huron
Paul T. Curl Brittany M. Weil CURL & STAHL, PC 700 North St. Mary’s St Suite 1800 San Antonio, Texas 78205
Trial Counsel for Trial Defendant A.J. Plastics, Inc. Lawrence L. Mealer LAW OFFICE OF LAWRENCE L. MEALER Maple Plaza Law Center 5353 Maple Avenue Suite 100 Dallas, Texas 75235 /s/ jeremy j. cook JEREMY J. COOK