Gray, Ritter & Graham, PC Wolf Haldenstein Adler Freeman & Herz, LLC Neblett Beard & Arsenault, LLP Don M. Downing And Adam J. Levitt v. Goldman Phipps PLLC F/K/A Goldman Pennebaker & Phipps, PC Mikal C. Watts, PC And Murray Law Firm

511 S.W.3d 639, 2015 Tex. App. LEXIS 10385, 2015 WL 5895302
CourtCourt of Appeals of Texas
DecidedOctober 8, 2015
DocketNUMBER 13-14-00310-CV
StatusPublished
Cited by9 cases

This text of 511 S.W.3d 639 (Gray, Ritter & Graham, PC Wolf Haldenstein Adler Freeman & Herz, LLC Neblett Beard & Arsenault, LLP Don M. Downing And Adam J. Levitt v. Goldman Phipps PLLC F/K/A Goldman Pennebaker & Phipps, PC Mikal C. Watts, PC And Murray Law Firm) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Gray, Ritter & Graham, PC Wolf Haldenstein Adler Freeman & Herz, LLC Neblett Beard & Arsenault, LLP Don M. Downing And Adam J. Levitt v. Goldman Phipps PLLC F/K/A Goldman Pennebaker & Phipps, PC Mikal C. Watts, PC And Murray Law Firm, 511 S.W.3d 639, 2015 Tex. App. LEXIS 10385, 2015 WL 5895302 (Tex. Ct. App. 2015).

Opinion

OPINION

Opinion by

Justice Longoria

Appellants, Gray, Ritter & Graham, P.C. (“GRG”), Wolf Haldenstein Adler Freeman & Herz LLC (‘WHAFH”), Neblett Beard & Arsenault LLP (“NBA”), Don M. Downing, and Adam J. Levitt, appeal the trial court’s denial of their special appearances. Appellants served as leadership counsel *648 representing the plaintiffs in multidistrict litigation in federal court against Bayer CropScience L.P. and other entities (collectively “Bayer”) based on the escape of genetically modified rice into the nation’s rice crops. Appellees, Goldman Phipps, PLLC f/k/a Goldman Pennebaker & Phipps, P.C., Mikal C. Watts, P.C., and Murray Law Firm also represented plaintiffs bringing claims against Bayer, however, their cases were generally filed in Texas and other state courts rather than in the federal multidistrict litigation case. Appellants claim that appellees owe them attorney’s fees from a settlement that ap-pellees reached with Bayer in the state court cases. In the underlying proceeding, appellees filed a declaratory judgment action against appellants to construe appellants’ rights to the fees under the state court settlement agreement.

After examining the principles of jurisdiction at issue in this case and the jurisdictional evidence provided by the parties, we affirm the trial court’s order denying appellants’ special appearances on grounds that the appellants purposefully availed themselves of the privilege of conducting activities in Texas and their liability arose from or was related to those contacts.

I. Background

In August of 2006 and March of 2007, the United States Department of Agriculture announced that two unapproved genetically modified varieties of rice developed by Bayer had escaped from Bayer’s test plots into the nation’s rice crops. As a result, thousands of rice farmers, land owners, and rice producers in the five main rice-producing states, Texas, Arkansas, Louisiana, Mississippi, and Missouri, brought suit against Bayer for their damages. The United States Judicial Panel on Multidistriet Litigation transferred and consolidated the cases that had been filed in or removed to federal court into a single federal multi-district case in the United States District Court for the Eastern District of Missouri before the Honorable Catherine D. Perry (the “genetically modified rice MDL”).

After receiving and reviewing various proposals from law firms who wished to serve as leadership counsel for the plaintiffs in the genetically modified rice MDL, Judge Perry appointed Downing from the law firm of GRG, and Levitt, who at that time was a partner with WHAFH, to serve as co-lead counsel for all of the plaintiffs. Judge Perry appointed Arse-nault of NBA to serve on the plaintiffs’ executive committee. Judge Perry directed co-lead counsel and the plaintiffs’ executive committee (collectively referred to as the leadership group or the common benefit attorneys), to act on behalf of all plaintiffs in the genetically modified rice MDL in prosecuting the case. 1 The leadership group engaged in discovery, including taking over 150 depositions, retained experts, and handled dispositive motions. The leadership group picked groups of plaintiffs from each state for “bellwether” trials to be held in St. Louis, Missouri. 2 The leadership group conducted the trials, *649 three of which resulted in verdicts for the plaintiffs, and a fourth trial which settled after the first week. The fourth bellwether trial, which settled, featured Texas plaintiffs.

While the genetically modified rice MDL proceeded in federal court, other cases against Bayer remained in state courts and were prosecuted in essentially parallel litigation by appellees in Texas, Arkansas, and Louisiana. Appellees represented approximately 5,000 of the plaintiffs in the state court litigation and also represented some of the clients who had claims pending in the federal MDL. 3 In the state court litigation, appellees conducted discovery, including taking over 120 state court depositions, and handled dispositive motions. Appellees tried two of the state court cases to verdict, one of which constituted the first punitive damage verdict and the highest overall per-acre award against Bayer.

After the bellwether trials in the genetically modified rice MDL and the two state court trials, Bayer offered to settle all claims against it, in both the federal MDL proceeding and the state court claims, through a global settlement totaling $750 million. Bayer wished to buy “global peace,” and thus all claims against it, whether filed in the federal MDL or in state court, had to be settled for the total amount in order for the settlement to be effectuated. In order to accomplish the global settlement, Bayer entered into two separate settlement agreements. One of the settlement agreements, the genetically modified rice MDL settlement agreement, related exclusively to plaintiffs whose cases were included . in the federal rice MDL, for which the appellants served as the leadership group. The second settlement agreement, the GMB 4 state court settlement agreement, resolved the claims of state court litigants who were appellees’ clients.

Watts testified that the GMB state court settlement was negotiated first. According to Watts, appellants were not signatories on the GMB state court settlement agreement, however, they were “involved” in that settlement.' Watts testified that Bayer would not agree to settle any claims against it unless the plaintiffs in both the MDL and state court cases agreed to settle for the total sum of $750 million. “And so the different parties had to, in effect, approve the other settlement because there was money moving around between the two.” Watts testified that appellants “got to be the signatories on the MDL settlement” and “[w]e got to be the signatories on the GMB settlement.” Watts testified that “there was plenty [of] back and forth about what should be in each after the original deal was done.”

The funds for the GMB state court settlement were structured1 through a qualified settlement fund agreement.” The purpose of the fund was to “accept, hold and distribute funds” paid by Bayer in consideration of the settlement of all claims against Bayer and a full and final *650 release. According to the qualified settlement fund agreement:

Allocation issues exist as to the settlement, including but not limited to allocation among the plaintiffs and various attorneys, payment of fees and litigation expenses, potential liens and other unresolved matters. It is the best interests of the Plaintiffs that the money be paid into a Fund which earns income rather than held by [Bayer] while those issues are being resolved.
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511 S.W.3d 639, 2015 Tex. App. LEXIS 10385, 2015 WL 5895302, Counsel Stack Legal Research, https://law.counselstack.com/opinion/gray-ritter-graham-pc-wolf-haldenstein-adler-freeman-herz-llc-texapp-2015.