in Re: XTC Cabaret (Dallas), Inc.

• Court: Court of Appeals of Texas
• Decided: January 18, 2022
• Docket: 05-21-00794-CV
• Status: Published

Opinion

CONCUR & DISSENT and Opinion Filed January 18, 2022

S In The Court of Appeals Fifth District of Texas at Dallas No. 05-21-00794-CV

IN RE XTC CABARET (DALLAS), INC., Relator

Original Proceeding from the 116th District Court Dallas County, Texas Trial Court Cause No. DC-19-13178

CONCURRING AND DISSENTING OPINION Opinion by Justice Schenck In this negligence and premises liability case, the real party in interest seeks

to recover damages for injuries she sustained from an assault that occurred in a

parking lot she contends was controlled by relator at the operative time. Real party

propounded discovery to relator and sought to compel production of same after

relator objected to doing so. The trial court signed an order compelling relator to

produce some of the requested documents. Relator filed a petition for writ of

mandamus seeking to vacate the trial court’s order as to three categories of

documents.

I concur with the majority in the denial of relator’s petition insofar as it

concerns the portion of the trial court’s order compelling production of incident reports and instructions and policies concerning safety and security. I dissent from

the majority’s denial of the petition to the extent relator seeks to set aside the portion

of the trial court’s order compelling it to produce documents evidencing or reflecting

its gross income for the years 2017 and 2018 because the requested information is

not relevant to any issue in this case.

BACKGROUND

On January 1, 2019, relator hosted a new year’s party. Around 2:30 a.m., real

party was assaulted in a parking lot adjacent to relator’s place of business. More

particularly, real party asserts that the assailant slammed his vehicle’s door into her

vehicle, he punched her several times and then attempted to run over her with his

vehicle and exit the parking lot. Two security guards shot into the assailant’s

vehicle, killing him.

Real party sued relator and others asserting various claims against them. As

to relator, real party asserts claims of negligence, negligent hiring, retention,

supervision, training, premises liability, and gross negligence. Discovery ensued,

leading to the order that is the subject of this original proceeding.

AVAILABILITY OF MANDAMUS RELIEF

Entitlement to mandamus relief requires relator to show that the trial court has

clearly abused its discretion and that relator has no adequate appellate remedy. In

re Prudential Ins. Co., 148 S.W.3d 124, 135–36 (Tex. 2004) (orig. proceeding).

“Generally, the scope of discovery is within the trial court’s discretion,” but “the

–2– trial court must make an effort to impose reasonable discovery limits.” In re CSX

Corp., 124 S.W.3d 149, 152 (Tex. 2003) (orig. proceeding) (per curiam). An order

that compels discovery well outside the bounds of proper discovery is an abuse of

discretion. Id.

Whether a clear abuse of discretion can be adequately remedied by appeal

depends on a careful analysis of the costs and benefits of interlocutory review. In re

McAllen Med. Ctr., Inc., 275 S.W.3d 458, 464 (Tex. 2008) (orig. proceeding)

(citing In re Prudential Ins. Co., 148 S.W.3d at 136). If an appellate court cannot

remedy a trial court’s discovery error by appeal, then an adequate appellate remedy

does not exist. In re Dana Corp., 138 S.W.3d 298, 301 (Tex. 2004) (orig.

proceeding). A party would have no adequate remedy by appeal, for example, where

it has already been forced to gather and produce “patently irrelevant” information

such that it clearly constitutes harassment. Walker v. Packer, 827 S.W.2d 833, 842

(Tex. 1992) (orig. proceeding).

DISCUSSION

Generally, discovery is permitted into any matter, not privileged, that is

relevant to the subject matter and is “reasonably calculated to lead to the discovery

of admissible evidence.” TEX. R. CIV. P. 192.3(a). Discovery requests must be

reasonably tailored to include only relevant matters. In re CSX Corp., 124 S.W.3d

at 152.

–3– Real party’s claims against relator center on whether relator owed her a duty,

breached that duty, and whether the breach caused her harm, and on whether relator

had actual or constructive knowledge of the condition causing the injury, the injury

posed an unreasonable risk of harm, relator failed to take reasonable care to reduce

or eliminate the risk, and relator’s failure to use reasonable care to reduce or

eliminate risk was the proximate cause of injuries to real party. See Henkel v.

Norman, 441 S.W.3d 249, 251 (Tex. 2014) (listing elements of premises liability

claim); Lee Lewis Constr., Inc. v. Harrison, 70 S.W.3d 778, 782 (Tex. 2001) (listing

elements of negligence claim). Relator’s gross income has no relevance to the

claims real party asserts against it.

Although real party alleges entitlement to exemplary damages, only current

net worth is potentially relevant to that issue. See In re Potashnik, No. 05-19-01188-

CV, 2020 WL 1933796, at *2 (Tex. App.—Dallas Apr. 22, 2020, orig. proceeding)

(mem. op.). Even assuming for present purposes that it would be relevant at this

stage of the litigation, net worth is calculated as the difference between total assets

and total liabilities as determined by generally accepted accounting principles. G.M.

Houser, Inc. v. Rodgers, 204 S.W.3d 836, 840 (Tex. App.—Dallas 2006, no pet.).

Gross income does not equate to net worth and has no reasonable relationship to it.

Southland Corp. v. Burnett, 790 S.W.2d 828, 830 (Tex. App.—El Paso 1990, no

writ). Relator’s gross income for 2017 and 2018 has no bearing on its current net

worth or any other live issue in the case. Thus, it is not relevant and, absent some

–4– other showing, it is neither discoverable nor tailored to meet the trial court’s

obligation to avoid undue burden. See In re Am. Optical Corp., 988 S.W.2d 711,

713 (Tex. 1998) (orig. proceeding) (per curiam); K Mart v. Sanderson, 937 S.W.2d

429, 431 (Tex. 1996) (orig. proceeding) (per curiam); Kern v. Gleason, 840 S.W.2d

730, 738 (Tex. App.—Amarillo 1992, orig. proceeding). Accordingly, I believe

relator met its burden of establishing the trial court abused its discretion in ordering

the production of documents concerning its 2017 and 2018 gross income.

ADEQUATE REMEDY BY APPEAL

Because relator would be forced to produce irrelevant information that is

sensitive in nature, I conclude we would not be able to cure the trial court’s error and

relator would not have an adequate remedy by appeal. In re Weekley Homes, L.P.,

295 S.W.3d 309, 322 (Tex. 2009) (orig. proceeding).

CONCLUSION

Because the trial court clearly abused its discretion in compelling relator to

produce information concerning its gross income and relator does not have an

adequate remedy by appeal, I dissent from the majority’s conclusion relator has

failed to show it is entitled to relief from the trial court’s order compelling it to

produce same.

/David J. Schenck/ DAVID J. SCHENCK JUSTICE 210794DF.P05 –5–