Features for September 2014

Welcome to the September 2014 edition of the Appellate Lawyer --
the newsletter of the HBA Appellate Practice Section.

STREETT TO THE SUPREME COURT
Aaron Streett discusses his experience arguing before the United States Supreme Court.

TO PRESERVE AND PROTECT HARRIS COUNTY'S HISTORIC COURT RECORDS
David Furlow tells the tale of one man's efforts to preserve Harris County's historic court records.

REWRITE THIS SENTENCE
Justice Bill Boyce, 14th Court of Appeals, explores the impact of split-court decisions.

DID YOU KNOW . . . ?
by JoAnn Storey

APPELLATECH
Derek D. Bauman shows you how to be the 10th United States Supreme Court Justice.

CASE UPDATES FOR JUNE, JULY, AND AUGUST 2014
Case updates for the Houston practitioner
by John Barnes, Baker, Donelson, Bearman, Caldwell & Berkowitz, PC, and Andrew Nelson, Wright & Close, LLP

UPCOMING LUNCHEONS
A look at the upcoming CLE luncheons for the HBA Appellate Practice Section

STREETT TO THE SUPREME COURT

It's Like Speed Chess on Nine Boards at Once

by J. Stephen Barrick, Hicks Thomas LLP

Arguing a case before the U.S. Supreme Court is an experience that few lawyers ever have. Even for appellate specialists, the opportunity to argue in the highest court in the land is extremely rare. It is therefore special that one of our own – Aaron Streett of Baker Botts LLP – recently got that opportunity.

On March 5, 2014, Aaron presented oral argument on behalf of the petitioner in Halliburton v. Erica P. John Fund – a securities fraud class action case. Aaron’s client challenged the continued validity of the Court’s landmark case upholding the “fraud on the market” theory of reliance, Basic v. Levinson.

Sketch by Art Lien, courtartist.com

It was a weighty case by any measure. But it was also Aaron’s first time to present oral argument in the Supreme Court, and he was up against one of the country’s most well-known Supreme Court advocates, David Boies. And, at the end of the day, Aaron’s client walked away with a partial victory.

I recently had an opportunity to ask Aaron a few questions about his experience.

How did you get involved in this case?

Baker Botts has been lead counsel for Halliburton since shortly after the complaint was filed. I was brought into the case when it reached the Supreme Court the first time, back in 2010. My first assignment was to draft the Brief in Opposition to the Erica P. John Fund’s cert petition. I have been the lead appellate lawyer on the case since that time.

Are securities fraud class actions a particular specialty of yours?

No. I am an appellate generalist.

What made the case a good one for Supreme Court review?

At the end of the 2012 Term in the Supreme Court’s Amgen decision, four Justices suggested they were willing to reconsider the seminal securities decision of Basic v. Levinson. Our cert petition squarely presented the Court with that opportunity. There was also a circuit split on our second question presented: Whether a defendant may rebut the Basic presumption of reliance at the class certification stage with evidence that the alleged misrepresentations did not affect the stock’s market price.

There were a lot of amicus briefs filed in this case - 11 per side. Were you anticipating that much interest?

Yes, the questions presented are important to investors and companies alike.

Did you have to proactively seek out amici? How did you go about that?

At the cert stage, we reached out to potential amici to make them aware of our forthcoming cert petition and explain the issue and arguments we would be making. Once cert was granted, the remaining amici came out of the woodwork.

What was your reaction when you found out that cert had been granted?

I was at lunch in Washington, D.C., with Judge David Sentelle of the D.C. Circuit, the judge for whom I clerked. I was trying to be polite and not check my phone during lunch, but one of my colleagues on the case, Shane Pennington, who was also a Sentelle clerk, checked his phone and saw the news. We were surprised and excited, and it was a neat moment to share with the Judge who set our careers on track.

Appellate lawyers have come to expect some pretty drawn-out timetables, but in the Supreme Court, things can move pretty quickly. You filed your petition on September 9; the Court granted cert on November 15, less than three weeks after you filed your reply to the Respondents’ opposition; your brief on the merits was due 45 days after that; oral argument was scheduled for less than three months after you filed your brief; and the Court issued its decision, with three separate opinions, just three and a half months after that. What was that like?

It was intense. I felt like I spent most of my time over those months on this case, which made it challenging to keep up with other matters. One has to have a very talented and hardworking team to manage the research and drafting and argument preparation on such a compressed timetable, and we had that. The reply brief was especially tricky because we had to respond not only to the Fund’s 50-page merits brief, but also to 11 amicus briefs, including the brief of the United States’ Solicitor General.

Merits briefs, as you know, can be a pretty big job. Was it difficult to get that done in 45 days?

It was challenging. These issues were incredibly complex, involving economic theory, the specialized area of securities law, as well as the need to argue stare decisis. Again, we had a terrific team working around the clock. The biggest hurdle was coordinating all of the information and boiling it down into a persuasive brief.

How many people were involved in preparing your brief?

Seven attorneys.

At what point were you tapped to argue the case?

Shortly after cert was granted.

That was obviously a tremendous honor, but it was also an awesome responsibility. How did you feel at the time, knowing you were going to be the one standing there in front of “the Nine”?

I was humbled and a little overwhelmed. It’s daunting enough to argue any case in the Court, but it was particularly unusual to have such a significant case as one’s first argument. That said, having clerked at the Court and having argued a couple dozen appeals in other courts, I felt confident that I could get prepared and ultimately turn in a solid performance.

Can you describe what you did to prepare for oral argument?

Re-read the briefs, the key parts of the record, and all the potentially relevant cases. Identified 3-4 key points to emphasize and refined different ways to articulate them. Drafted anticipated questions and answers. Identified various further research topics and questions for members of the team. Participated in four moot courts. Practiced questions and answers ad nauseam. Spent a lot of time discussing answers and overall strategy with my appellate colleague and second-chair on the case, Evan Young.

At oral argument, you were up against one of the most high-profile Supreme Court advocates in the country, David Boies. Did that affect your preparation?

No.

You say you moot-courted four times. How did the anticipated questioning compare to the actual thing?

The moots predicted all but two questions.

How did your answer to those go?

One question was a hypothetical posed by Justice Breyer about applying the presumption of reliance to an international contract dispute decision he had just announced that morning. Following standard advice about how to answer Justice Breyer’s questions, I picked a part of the question that I understood and tried to answer it. The other question related to our fallback argument but seemed to be very tangential. I briefly answered it and pivoted to a point I wanted to make.

So, you arrive at the Supreme Court building the day of oral argument – what's the first thing you do when you get there?

Head up to the Lawyers’ Lounge and try to relax.

What sort of check-in process does the Court have?

Arguing counsel meet at a desk in the lower level of the Court and are escorted upstairs to the Lawyers’ Lounge. In the Lawyers’ Lounge, the Clerk of Court gives a briefing to arguing counsel about what to expect during the argument.

Was there anything about it that was surprising or unexpected?

We were told to wait to be escorted into the courtroom, but nobody came to get us. Finally, Mr. Boies and I decided we should start wandering in. We made it to counsel table at 9:58—a little too close for comfort.

How long before your scheduled time for oral argument did you arrive?

About an hour and a half.

Every practitioner has his or her own way of gearing up for argument. What did you do between the time you were checked in and the actual argument?

Prayed, drank a lot of water, and practiced my opening a few times. Other than that, I just tried to enjoy the experience and conversed with colleagues and other acquaintances who were in the Lawyers’ Lounge.

What kind of reception did you feel like you got from the Court's justices?

It was hard to know what to expect in this case, since we had a very aggressive opening position—asking the Court to overrule a leading precedent—and a fallback position that was likely to divide the Court along typical lines. Most of the Justices seemed skeptical of overruling Basic but open to our fallback position. It was a pretty hot bench—I got 39 questions in 30 minutes—but nothing out of the ordinary in terms of the tone or pace of the questioning.

One of the third-party accounts of the argument made it sound like you got pummeled with hard questions while they just sat and listened to Boies talk. Did it seem like that to you?

Mr. Boies got his fair share of hard questions, but he did get fewer overall questions than I did. I was a little surprised by that.

What was the most memorable moment about oral argument for you?

Probably being able to conclude my rebuttal argument with a strong closing just as the red light came on. There is no countdown timer at the Court, which makes it quite difficult to time one’s closing. I also received an infamous two-minute hypothetical question from Justice Breyer, in which he referenced an opinion he had just handed down that morning.

The Court’s ultimate decision was a bit of a mixed bag for your client. Was the Court’s decision a surprise?

We were very pleased to prevail unanimously on our fallback argument, resulting in a vacatur of the lower courts’ decision to certify the class. The Court’s unanimity on that point was quite surprising, because a closely-divided Court had ruled for the plaintiffs on a similar securities question the preceding Term. We were not surprised that the Court declined to overrule Basic, especially after hearing the Justices’ questioning at argument. That would have been the securities-law equivalent of overruling Roe v. Wade. By accepting our fallback argument, the Court alleviated some of the worst problems with how Basic was being applied by the lower courts.

You clerked for the Court about 10 years ago for William Rehnquist. Did you feel like the Justices recognized you?

I am acquainted with a couple of the Justices, but they treat all counsel the same, with very few exceptions.

Was there any ceremony or process at the Supreme Court that was special or unusual?

Yes, the Court is the only U.S. appellate court of which I am aware that issues its decisions in open court. On the morning of my argument, the Court issued opinions in three cases. The authoring Justice reads a summary of his or her opinion from the bench. I always enjoyed watching this as a clerk, but as an advocate waiting to argue it only served to heighten the tension.

Do you feel like you learned something new about oral argument from this experience?

Yes, I experienced firsthand how different arguing in the Supreme Court is from any other court. The rapidity and quality of the questioning is unmatched and the demands of economy and strategy in answering those questions effectively is analogous to playing speed chess on nine boards at once. I just hope to continue to improve with each argument, as it is a skill that can only be sharpened with experience.

What about practice before the Supreme Court in general?

Practice before the Court is unique by virtue of the Justices’ location at the pinnacle of the third branch of government. Particularly where the Court is being asked to overrule an important precedent, the Court considers a lot of factors that are not “legal” in the strict sense of the word, including the Court’s institutional legitimacy and its relationship with Congress. I was also struck by the media and public-opinion battle waged in connection with the case.

Finally, and most important, what about the storied quill pen? Did you get one of those?

Yes, all four lawyers at counsel table get one. So this was actually my third quill, although this one is certainly more meaningful to me than the earlier two.

To Preserve and Protect Harris County’s Historic Court Records

by David Furlow1

This is the story of Francisco Heredia, a man who makes a difference every day. Francisco has taken charge of helping preserve Harris County’s – and Houston’s – historic legal heritage. As Team Leader of Harris County District Clerk Chris Daniel’s Historical Documents Records Center, Francisco Heredia ensures that the record of Harris County’s rich legal heritage is preserved, protected and easily accessible to lawyers, judges, justices, historians and members of the public. Anyone interested in seeing an important part of Texas legal history can examine these records in Room 200 of the Harris County Civil Courthouse.

Rust never sleeps. As graying rock and roller Neil Young sings, “Rust never sleeps.” In the absence of effective conservation, the decay and destruction of archival records is inevitable. Things fall apart, and often the center of a document fraying with time does not hold.

A little more than a decade ago, courthouse records with dramatic tales of Harris County’s history lay moldering like John Brown in his grave. An unmarked grave of docket sheets, judgments, orders, evidence and appeals, many dating back to the decade-long Republic of Texas, occupied a red brick building on a grubby corner of downtown Houston at the intersection of Texas and Austin. Climate control consisted of a single window-unit familiar to anyone who suffered through their buzzing, rattling and periodic breakdowns during the Fifties and Sixties. The acidity of paper, high humidity, the ravages of hurricanes and floods, the jaws of rats and roaches, and decades of neglect were reducing Harris County’s judicial history to fading stacks of confetti.

Enter Francisco Heredia. Born in Michoacán, Mexico, Francisco came to Houston in 1976. He has lived here ever since. Francisco and his wife Yozi have raised three children—Daniela, Victoria and Francisco—who attend KIPP Academy. Francisco developed an interest in history while studying computer information systems at the University of Houston. Francisco is grateful to the city that welcomed him. He gives back to his community by preserving and protecting its history.

Francisco went to work in the Customer Service Center of the Harris County District Clerk’s Office in 1996. He began his efforts to preserve Harris County’s historic courthouse records in 1998. At the time, records of trials, litigation and appeals, many of them historically unique, were decaying and disorganized. Many had been destroyed. And too many of those that remained were assigned for disposition in Dempsey dumpsters.

Under the tutelage of a concerned county employee, Michael Sturm, Francisco familiarized himself with how to find and preserve century-old records. By 2004, he knew that the county had to take action to preserve its legal history for future generations.

The creation of the Harris County Historical Documents Center. At the same time, other county leaders recognized that the County’s and Houston’s historical heritage was at severe risk. Before his retirement in 2009, Harris County District Court Judge Mark Davidson had served as Judge of the Eleventh Judicial District for twenty years. While serving on the bench, he began researching and publishing the history of Harris County’s judiciary.

Before he resigned his position as District Clerk to run for County Judge, Charles Bacarisse earned well-deserved praise for taking effective steps to preserve the County’s courthouse records, modernize dockets, and make current records accessible online. When Bacarisse examined the decaying records of the county’s courts, he saw the severe damage that had already been done.

Together with Heredia, Judge Davidson and District Clerk Bacarisse began working together in 2004 to organize the old courthouse records, raise public awareness, and solicit the funds necessary to preserve the courthouse records before they were forever lost. They removed the decaying records from the brick warehouse at Texas and Austin in 2001 and brought them to Harris County’s Civil Courthouse. On October 24, 2006, County officials opened the Historical Document Room to provide the public with access for viewing historical documents from 1837—1925.


Francisco Heredia, in front of the old brick repository of Harris County’s judicial records (top photo, David A. Furlow, 2014) and in the current Historical Documents Record Center (Harris County District Clerk’s photo)

Working in close association with Judge Mark Davidson and other members of Harris County’s justice system, Francisco acted effectively to preserve a treasure trove of Harris County judicial records, including some 35,000 pages of court records dating back to the Republic of Texas.

Historical records are now available through the District Clerk’s website. Current District Clerk Chris Daniel shares Francisco Heredia’s love of Harris County’s legal history. Born in Houston and raised in Jersey Village and northwest Harris County, he learned about world history and Dutch from his mother, Jolie, who grew up on Curacao, a Dutch island colony off northern Venezuela. Chris honors former District Clerk Bacarisse’s vision by making the County’s judicial records available at the Historic Documents Record Center in Room 200, on the Second Floor of the Civil Courthouse at 201 Caroline in downtown Houston. The Center is open from 9 AM to 1 PM on Wednesdays and from noon to 4 PM on Tuesdays and Thursdays.

Chris and Francisco make historic documents available to historians, lawyers, judges, and the general public free of charge on a page of Chris Daniel’s website at http://www.hcdistrictclerk.com/common/historicaldocument/HistoricalDocumentsMain.aspx. Judge Davidson provided the public with a Historical Case of the Month on a webpage that provides easy access to previous histories of the judiciary, including The Case of the First Woman Juror, The First Report of the Grand Jury on the Harrisburg County Jail, and Houston’s First Thanksgiving at http://www.hcdistrictclerk.com/common/About/HCDCNews.aspx?CoM=1. In addition, a former employee of the District Clerk’s Office, Claire Kennedy, has organized a public display of records and exhibits on the first floor of the Civil Courthouse.

The District Clerk’s Office has teamed with the Houston Bar Foundation to raise the funds needed to continue restoring and preserving Harris County’s past. The Houston Bar Foundation is accepting tax-deductible donations to preserve records. Those who want to assist in preserving these valuable records can write a check to the Houston Bar Foundation Records Preservation Project at P.O. Box 4651, Houston, Texas 77253.

The Historical Document Center’s record of a breach of warranty case involving the 1853 sale of a slave and a Texas Supreme Court appeal. One interesting case file available at the Center is a slavery case, Tilley v. Scranton, appealed to the Texas Supreme Court as Scranton v. Tilley, 16 Tex. 183 (1856). The case arose in 1854 as a purchaser’s breach of warranty lawsuit against the auctioneer/seller of a slave. George W. Tilley, the purchaser of a slave, sued F. Scranton & Company.

Tilley sued to recover the value of a slave named Friday who was misrepresented as healthy during a July 6, 1853 sale in Houston. The slave actually had epilepsy and died in the autumn of 1853 after suffering convulsions. The court’s record reflects that, “if [Friday] had been sound as warranted, his value would have been $ 1,500; that plaintiff procured the best medical attention for him; that his services were of no value, and that plaintiff, in addition to the loss of the value of said slave, suffered other damage as aforesaid to the amount of $ 500. [Tilley prayed] for the value of the slave and the other damages, and general relief.” Id. at 184.

Because of the passage of time and universal modern agreement that slavery was one of the world’s great evils, the Texas Supreme Court’s discussion of the case is likely to shock most readers. But the decision reflects the way social mores have changed over the past two centuries.

The Defendants pled a general demurrer and denial. Trial took place on the December 29, 1855. “Friday was apparently about sixteen years old; color, between mulatto and black; [and] delicately formed.” Id. at 185. Witnesses described Friday’s fevers, fits, and convulsions. Contending experts differed as to whether Friday was sick when sold or whether he died of heat stroke. The jury found for the plaintiff $1,100, the value of the slave as misrepresented, along with prejudgment interest dating pack to the sale on July 6th, 1853, and thirty dollars damages. The trial court overruled a motion for new trial. Id.

Chief Justice Royal Tyler Wheeler, who presided over the appeal, was born in Vermont in 1810 and grew up in Ohio, where he also received his education, studied law, and was admitted to the bar. He moved to Fayetteville, Arkansas in 1837, where he began a law practice with later Texas Supreme Court Justice William Oldham. Wheeler married and moved to San Augustine, Texas in 1839. See University of Texas School of Law, Tarlton Law Library, JUSTICES OF TEXAS 1836-1986, Royall Tyler Wheeler (1810-1864), http://tarlton.law.utexas.edu/justices/profile/view/114 (last accessed Sept. 4, 2014); James L. Haley, The Texas Supreme Court: A Narrative History, 1836-1986 (Univ. of Tex. Press, 2013), 29, 54-60, 66.

The Texas Supreme Court affirmed the judgment as to both liability and damages. Chief Justice Wheeler, who later became an ardent secessionist, treated the case as one no different from any other property dispute, setting forth an affirmation-friendly sufficiency of evidence standard of review:
Under the charge of the Court as applied to the evidence, the jury, in finding a verdict for the plaintiff, must have acted under the conviction, that the negro was diseased at the time of the sale and warranty, and that that disease caused his death. That was what the evidence conduced to prove; and it was only upon that supposition, or belief, that the jury could have found a verdict for the plaintiff. If the evidence was sufficient to warrant that conclusion, the verdict was right, and in accordance with the previous decisions of this Court. (Murphy v. Crain, 12 Tex. 297; McKinney v. Fort, 10 Id. 220.)
Scranton, 16 Tex. at 192.

Although Chief Justice Wheeler found that the case was a close one, the Texas Supreme Court nevertheless had to affirm the judgment to preserve its precedent:
The evidence, it must be admitted, is not very satisfactory, as to the fact of disease or unsoundness at the time of the sale. And it is to be regretted that the rights of parties must be finally determined upon evidence, which is not more convincing and satisfactory. But we cannot say, that the jury were not warranted by the evidence, in coming to the conclusion at which they arrived; or that the Court erred in refusing a new trial on that ground. The evidence before the jury certainly conduced to support the verdict; and it is a circumstance not to be disregarded, that the defendants offered no evidence to the contrary, except the testimony of a witness, as to the apparent soundness of the negro for a few days before the sale; and that was but little more than appeared from the plaintiff's evidence.
Id.

The Texas Supreme Court expressed concern about the measure of damages awarded after comparing decisions of other slave state jurisdictions:
Where however the plaintiff has enjoyed the benefit of the services of the negro, for any considerable length of time, and they have been valuable to him, such services ought to be an offset to the damages to the extent of their value. The value of the services, in this case, was not proved; but it would seem, from the evidence, that the negro performed the services of an ordinary hand, for a period of several months. The evidence, we think, was sufficient to extinguish the claim for interest; and to that extent, the verdict is apparently excessive.
Id. at 194-95.

Chief Justice Wheeler rejected any appellate complaint about the measure of damages, however, after concluding that petitioner Scranton’s counsel had waived any charge error by failing to timely and specifically complain in the trial court:
The charge of the court, as to the measure of damages, we deem to maintain the correct general rule; and had the attention of the court been called to this point, by instructions asked upon it, the charge would doubtless have been so far modified as to have given the defendants the benefit of the value of the services of the negro while in the plaintiff's service.

But the point does not appear to have been suggested by counsel in the court below, either by asking a proper instruction, or in their motion for a new trial: and on this account, there might, perhaps, be some difficulty in reforming the judgment in this respect, in this court.
Id. at 195.

In light of respondent Tilley’s willingness to accept a remittitur to correct the troubling questions involving the calculation of prejudgment interest, Chief Justice Wheeler concluded that any error in the charge or denial of petitioner Scranton’s motion for new trial was harmless: “But as the plaintiff has intimated a willingness to remit the interest, which will remove the difficulty, his remittitur will be received, and the judgment be otherwise affirmed, at the cost of the appellants.” Id.

The warranty deed at the heart of the case, now available in the Historic Documents Center, appears at the right below:


District Court records dating from 1837 (top photo, David A. Furlow, 2014) and F. Scranton’s 1853 Warranty of Sale for the Slave Sandy (District Clerk’s photo)

A decade later, on April 9, 1864, as the imminent collapse of the post-Vicksburg, post-Gettysburg Confederacy became apparent to all, secessionist Chief Justice Wheeler saw no future but a dismal one. “[I]nclined to the forebodings of melancholy . . . and contemplating the clouds which hung over the future of his country and the prospects of his family,” Chief Justice Royall Tyler Wheeler took his own life at his home in Washington County. See James Daniel Lynch, The Bench and Bar of Texas 91-96 (St. Louis, Mo.: Nixon-Jones Printing Co., 1885).

The courthouse records of Tilley v. Scranton have not yet been conserved. Francisco Heredia and the Historic Documents Record Center are looking for an individual or a law firm ready to fund the preservation of the case file, the judgment, and an appellate record that includes a warranty of the good health of Friday, the young slave who died of epilepsy in Wharton County. The cost would probably amount to a few thousand dollars.

In Texas, the wheels of justice grind slowly, but they grind fine. Slavery took its toll on all, as shown by the nineteenth century Harris County courthouse records Francisco Heredia has preserved and protected. Former Harris County District Court Judge Levi Benton helped make Houstonians aware of Tilley v. Scranton’s “breach of warranty” decision when he spoke about the case in a Black History Month symposium at the District Clerk’s Office on February 26, 2008.

Randolph Campbell, a respected historian and the editor of The Laws of Slavery in Texas, a book written in collaboration with Bill Pugsley and Marilyn Duncan, the former Executive Director and the current Consulting Editor of the Texas Supreme Court Historical Society, paid Francisco the highest compliment. “Francisco Heredia, head of the Historical Documents Records Center in the Harris County District Clerk’s Office, was continually asked to track down obscure records. He never failed to find any document, and probably never will.”2

-------

1^ David Furlow, a native Houstonian, lawyer, husband, father, and historian, has served as Executive Editor of THE TEXAS SUPREME COURT HISTORICAL SOCIETY JOURNAL since 2011. See generally http://www.texascourthistory.org/ (Texas Supreme Court Historical Society website); see specifically http://www.texascourthistory.org/documents/TSCHS_JournalFall2011.pdf (Fall 2011) through http://www.texascourthistory.org/documents/TSCHS_Journal_Summer_2014.pdf (Summer 2014).

2^ See Randolph B. Campbell, The Laws of Slavery in Texas, 93 (Austin: Univ. of Tex. Press, 2010).

Rewrite This Sentence

by Justice Bill Boyce, Fourteenth Court of Appeals

Surely you remember this fairly recent Supreme Court case. 5-4 split. Issued shortly before an upcoming election amid fierce political battles. Majority and dissenting opinions follow a predictable fault line. Complicated issue involving fundamental questions about the reach of sovereign authority. Nothing come to mind? Here’s another hint. Think cattle ranching.

Still nothing? Let’s end the suspense with a citation: Plains Commerce Bank v. Long Family Land and Cattle Co., Inc., 128 S. Ct. 2709 (2008).

This citation likely means little unless your practice focuses on the law relating to Indian tribes. For those whose practices do not, here’s a quick overview from the introduction to Chief Justice Roberts’s majority opinion.

“This case concerns the sale of fee land on a tribal reservation by a non-Indian bank to non-Indian individuals.” Id. at 2714. “Following the sale, an Indian couple, customers of the bank who had defaulted on their loans, claimed the bank discriminated against them by offering the land to non-Indians on terms more favorable than those the bank offered to them.” Id. “The couple sued on that claim in tribal court; the bank contested the court’s jurisdiction.” Id. “The question presented is whether the tribal court had jurisdiction to adjudicate a discrimination claim concerning the non-Indian bank’s sale of fee land it owned.” Id. “We hold that it did not.” Id.

From a writing standpoint, there is much to praise about the opinion’s efficient introduction to a legally complicated dispute centered on business dealings between a cattle ranch and a bank.

The introduction summarizes key facts and the issue presented in a handful of not-overly-complex sentences. This summary sets up the discussion that follows in more than 30 pages of dense back-and-forth between the majority opinion (in which Chief Justice Roberts is joined by Justices Scalia, Kennedy, Thomas, and Alito) and the dissenting opinion (written by Justice Ginsburg and joined by Justices Stevens, Souter, and Breyer).

There’s a sporty semi-colon too, the appearance of which confirms Chief Justice Roberts’s membership among the .0001 percent of the writing population that knows how to employ this device properly in the service of subtle information delivery to readers. More than a comma; less than a period.

While the sub-atomic grammar is worth noting, the opinion’s 5-4 nature also warrants attention in light of a new study by Professor Cass R. Sunstein of Harvard Law School.

According to Professor Sunstein’s research, Supreme Court decisions divide pretty neatly at 1941. Individual justices concurred or dissented infrequently before 1941, and 5-4 decisions were rare. Since 1941, the frequency of concurring opinions, dissents, and 5-4 decisions has increased dramatically while the number of unanimous opinions has declined. He attributes this shift in large part to the arrival of Chief Justice Harlan Fiske Stone, who believed in the clash of ideas; often wrote separately; and encouraged other newly arrived and like-minded justices to do so. He concludes that Stone displaced a consensus-based norm established by Chief Justice John Marshall and replaced it with an emphasis on individual writing that continues today.

Professor Sunstein also explores whether there is an empirical basis for a view that unanimity increases the acceptance and legitimacy of high court opinions while extensive disagreement among the justices has the opposite effect. He pronounces the empirical foundation for this view to be “fragile” and concludes: “The post-1941 norm cannot be shown to compromise the Court’s role in American government, or to disserve the constitutional order.”

So, does Plains Commerce Bank’s holding carry less weight because it was a 5-4 decision? I’m guessing the answer is “No” if your client needs to know the jurisdictional limits of a tribal court – or the answer to a thousand other highly technical legal issues decided by the Supreme Court. 5-4 gets you to the same answer as 9-0.

Did You Know . . . ?

by JoAnn Storey

The filing of the mandate in the trial court, following a remand of the case on appeal, is not necessary to the jurisdiction of the trial court. Brazzel v. Murray, 481 S.W.2d 801, 803 (Tex.1972) (citing Continental Casualty Co. v. Street, 364 S.W.2d 184 (Tex.1963)). The courts reason that the rules dealing with the issuance and return of the mandate subsequent to judgment of remand are procedural in nature. See Continental Casualty, 364 S.W.2d at 187. The Court in Continental Casualty thus held that the trial court’s judgment was not void, even though no mandate had been issued at the time of trial. 364 S.W.2d at 187-88. See also Edwards Aquifer Authority v. Chemical Lime, Ltd., 291 S.W.3d 392, 410 (Tex.2009) (mandate is a procedural device intended to keep courts from issuing conflicting orders; it is a means of communication between courts).

For an exhaustive discussion of the history of the rule and its present viability, see Saudi v. Brieven, 176 S.W.3d 108 (Tex.App.─Houston [1st Dist.] 2004, pet. denied).

To preserve the complaint of procedural irregularity in proceeding to trial before the mandate is issued, file an objection. Continental Casualty, 364 S.W.2d at 188.

AppellaTech: Are You Ready for Some Fantasy SCOTUS?

We appellate lawyers, we're human just like everyone else. We like to relax. Have fun. Let our collective hair down once in a while. But we're also always on the look out for new cases that change the law for our clients. We need to stay abreast of the latest in the law to know what traps may lay in waiting for our clients. Or to know which traps to set for the opposing parties.

Turns out those things aren't completely mutually exclusive. That's right. In that tiny sliver of overlap in the Venn diagram of tomfoolery and staying up-to-date on the law lies Fantasy SCOTUS. You know how you always like to brag about how well you know the minds of the justices on the United States Supreme Court? Well now's your chance to shine. It's getting near the next Supreme Court term. So put your justice-channeling thinking cap on and get ready to make some predictions!

From what the makers tell us, Fantasy SCOTUS was originally conceived as a teaching tool for high school teachers to get their students interested in learning about the nation's highest court. Since then, it has expanded to include law students and anyone with a love of competition and a nerdy fascination with the supreme court justices (read: you).

Anyone can sign up and make predictions on the upcoming term's cases. After you sign up (and after the next term's cases are announced), you can vote on how you think each justice will vote in each case. You can even set up your own leagues. Apparently, if you have the mettle, you can even join the Elect League.  "This league is for the premier players. Users will be required to predict all cases that come before the Court and will be eligible for the Chief Justice, Senior Associate Justice, and Associate Justice Badges."

That's right. Supreme Court cases. Belonging in a fantasy league like all those cool sports-minded people. Badges. It's an appellate-nerd trifecta.

Let the trash talking commence.

Derek Bauman
Staff attorney, First Court of Appeals

Comments, questions, and useful information are always welcome (and desperately sought). Please send them to: submissions@hbaappellatelawyer.org.

Case Updates for June, July, and August 2014

TEXAS SUPREME COURT

Burbage v. Burbage, No. 12-0563 (Tex. Aug. 29, 2014)

Casteel error is waived by failure to assert a specific objection.

Chad Burbage was found liable for several million dollars in damages for making defamatory statements about the plaintiff. The trial court determined that ten of the statements at issue were defamatory per se and submitted each statement to the jury to determine whether it was substantially true when made. On damages, the trial court submitted broad-form questions for all ten statements. On appeal, Chad argued Casteel error in the submission of broad-form questions on damages, and the Third Court of Appeals held that Chad waived any error because he did not object specifically to the submission of broad-form damages questions.

In the Supreme Court, Chad argued that he preserved error because he objected to six of the liability questions on grounds of qualified privilege to make the statements. The Court first noted that if some of the liability questions were improperly submitted, the broad-form damages questions commingling valid and invalid bases of liability could constitute harmful error. But before reaching the potential Casteel issue, the Court first examined whether Chad preserved error as to the liability questions through a proper objection.

At trial, Chad’s counsel objected to six of the liability questions based on qualified privilege, but he asserted no objection to the form of the damages question. During the formal charge conference, Chad’s counsel stated that he believed that qualified privilege applied to six of the statements at issue. When asked by the court if he had an instruction to propose, Chad’s lawyer stated vaguely that he would have the jury be asked whether it found the statements to be false at the time they were made.

The Texas Supreme Court held that Chad’s objection was insufficient to apprise the trial court of the alleged error such that the court had an opportunity to correct the problem. When the trial court asked whether Chad had a requested instruction, counsel simply responded with a request that addressed the falsity of the statements. Qualified privilege can still apply even to false statements, so Chad’s requested instruction did nothing to apprise the trial court that he was attempting to raise a qualified privilege issue. Based on the vague instruction requested, the Court held that Chad did not preserve error in the submission of the liability questions. Because the Court could not reach the alleged error in the liability questions, the Court did not reach the potential Casteel issues involved in the damages questions.

King Fisher Marine Service, L.P. v. Jose H. Tamez, No. 13-0103 (Tex. Aug. 29, 2014)

The trial court may refuse to entertain charge objections made prior to the reading of the charge to the jury where the court previously set an earlier deadline for objections if the parties were afforded a reasonable amount of time to make their objections.

Jose H. Tamez, a welder on board a dredging vessel, sued the vessel operator, King Fisher Marine Service, to recover for injuries he sustained while helping two crew members lift a large and heavy socket-wrench assembly.

At an informal charge conference during trial, Tamez's counsel informed the court of a significant point of disagreement over whether the jury should be instructed on the “specific order” doctrine. At the formal charge conference, King Fisher objected to the instruction proposed by Tamez but did not submit an alternate definition. The trial court admonished the parties that any objections had to be made before the end of the formal charge conference. The next day, after the charge conference but before the charge was read to the jury, King Fisher submitted its proposed definition, but the court rejected it as untimely. The jury ultimately rendered a verdict in favor of Tamez, concluding that he had been acting under a specific order. Although the jury found Tamez 50% at fault for his injuries, because of the specific order finding, the trial court did not reduce the award. King Fisher appealed, and the court of appeals affirmed.

In a 5-4 decision, the Texas Supreme Court held that the trial court did not err in refusing to consider King Fisher's proposed definition. Writing for the majority, Justice Brown, joined by Justices Johnson, Willett, Lehrmann and Boyd, held that Tex. R. Civ. P. 272's requirement that objections be asserted before the charge is read to the jury merely sets an "outside limit" on when objections may be allowed. It does not preclude the trial court from setting of an earlier deadline so long as the parties are afforded a reasonable amount of time to object. Here, the record showed that King Fisher was on notice of the specific order issue well in advance of trial, and the trial court had set no limit on the length of the formal charge conference, but had merely required that all objections be made prior to its conclusion. Given that trial courts are traditionally afforded wide latitude in managing their dockets, the majority concluded that the trial court had not abused its discretion in refusing to consider the later proffered definition.

In a dissent joined by Chief Justice Hecht and Justices Green and Devine, Justice Guzman argued that the majority elevated adjudication on procedural technicalities above adjudication on the merits, and that the plain language of Rule 272 permits objections to be made at any point prior to the reading of the charge to the jury.


FIRST COURT OF APPEALS

In re United Services Automobile Association, No. 01-13-00508-CV (Tex. App.—Houston [1st Dist.] Aug. 21, 2014, orig. proceeding)

When the trial court grants a new trial following a verdict for the plaintiff, and its reasons are invalid or unsupported by the evidence, mandamus will issue to require the trial court to enter judgment on the verdict.

Also, when the evidence of damages supports a range, any award within that range will be upheld if a rational basis exists to support the jury’s calculation.

The plaintiffs, Mark and Stacey Bond, sued their homeowners’ insurer, USAA, in connection with damage to their home from Hurricane Ike. After the jury returned a mixed verdict, the trial court granted the plaintiffs’ motion for new trial, citing five separate grounds for its ruling. The defendant filed a petition for writ of mandamus, challenging each of the five grounds.

The reviewability of new trial orders has been in a state of flux since the Supreme Court’s decision in In re Columbia Medical Center, 290 S.W.3d 204 (Tex. 2009). Three years later, the Court decided In re United Scaffolding, Inc., 377 S.W.3d 685 (Tex. 2012), which broadened the scope of review of new trial orders a bit more. Then, in 2013, the Court decided In re Toyota Motor Sales U.S.A., Inc., 407 S.W.3d 746 (Tex. 2013), which opened new trial orders up to merits-based review.

The USAA court provided some clarity regarding the steps a court must take in reviewing new trial orders following the Texas Supreme Court’s trilogy of cases. First, the court considered whether the trial court’s stated bases were specific pursuant to In re Columbia. Second, the court considered whether the trial court’s stated bases were legally appropriate, pursuant to In re United Scaffolding. Finally, the court conducted the equivalent of a legal and factual sufficiency review pursuant to In re Toyota. Upon conducting this analysis, the court found that none of the trial court’s purported grounds for a new trial were adequate, and granted the petition for writ of mandamus.

One of the reasons for the trial judge’s grant of a new trial was that the jury’s damage figure of $150,000 “seem[ed] arbitrary.” The case involved the diminished value of a home. The defendant urged the trial court to disregard the award and award zero damages, while the plaintiff argued that the evidence showed that damages should have been $900,000 at a minimum.

The court held that “when the evidence presented at trial supports a range of damages, the jury has discretion to award damages within that range, so long as a rational basis exists for the jury’s calculation.” The plaintiffs argued that the difference in the value of their home before it was hit by a hurricane and the value after it was damaged set the mark for the reduction in market value. The court found, however, that the jury could have answered “zero,” so the plaintiff’s evidence really established a range of zero to $725,000 – the difference between the value of the home before the hurricane and a purchase offer the plaintiffs received after the hurricane. Additionally, the defendant produced evidence of estimates of the cost of repair that ranged between $14,000 and $300,000. Because $150,000 fell within both ranges, the court upheld the jury’s award.

Also of note is the court’s disposition of the new trial order following its in-depth review of the grounds relied upon by the trial court. The court held that when all of a trial court’s stated reasons for granting a new trial are invalid, the proper remedy is to order the trial court to enter judgment on the verdict.


FOURTEENTH COURT OF APPEALS

Patel v. Harris County Appraisal District, No. 14-12-00892-CV (Tex. App.—Houston [14th Dist.] June 5, 2014)

A property owner who protests the appraised value of their home to the Appraisal Review Board of the Harris County Appraisal District, and obtains relief lowering the appraised value, may nonetheless appeal the determination for a trial de novo in district court.

Hasadbhai and Dharmishtha Patel challenged the Harris County Appraisal District’s (“HCAD’s”) 2010 appraisal of the value of their real property and improvements. HCAD had determined that the market value of the property was $2,132,414, and that the appraised value was $2,078,655. The Patels filed a notice of protest to the Appraisal Review Board. Shortly before the formal hearing before the Review Board, the Patels' designated property-tax agent signed a "Hearing Affidavit," opining that the appraised value of the property should be $1,911,490.00. The "Hearing Affidavit" was an unsworn form document. Following the hearing, the Review Board determined that the appraised value of the Property for the 2010 tax year should be $1,911,490.00 and ordered that the appraisal records be changed accordingly.

Nevertheless, the Patels timely appealed the Review Board's determination to the district court, seeking relief under sections 42.25 and 42.26 of the Tax Code, which provide remedies for excessive appraisal and unequal appraisal, respectively. HCAD moved for summary judgment on the theory that the Patels' appeal was barred by judicial estoppel, since the statements contained in the Hearing Affidavit were proffered by them. The district court granted the motion and dismissed the Patels' appeal with prejudice.

The Court of Appeals reversed and remanded, concluding that the Tax Code permits an appeal by a property owner of the Review Board's determination, even where favorable, since the statute does not specify that the determination must be unfavorable to permit appellate review by the district court. The court held that judicial estoppel did not apply since: (a) the Review Board hearing was not a judicial proceeding; and (b) the Hearing Affidavit was not sworn testimony.

Thu Binh Si Ho v. Saigon National Bank, No. 14-13-00607-CV (Tex. App.—Houston [14th Dist.] July 22, 2014)

A suit to collect on a promissory note requires affirmative proof that the claimant is the owner and holder of the note, which may not be inferred from the surrounding circumstances.

Saigon National Bank sued Thu Binh Si Ho to collect on a promissory note that he defaulted on. The bank moved for summary judgment, attaching the affidavit of Patrick Siu, its Chief Credit Officer and Executive Vice President. Photocopies of the original note and business loan agreement, both signed by Ho, were attached to the affidavit. In his affidavit, Siu averred that the bank had executed a loan agreement with Ho, that Ho had subsequently defaulted upon the agreement, and that the bank had demanded the amount due and owing. However, Siu failed to state that the bank was the current owner and holder of the note. The trial court granted summary judgment in favor of the bank, and Ho appealed.

The Court of Appeals reversed and remanded, holding that, in the absence of affirmative proof demonstrating current ownership of the note, the bank had not established that it had standing to collect the debt.

In a dissenting opinion, Chief Justice Frost agreed that the trial court's decision ought to be reversed and remanded, but disagreed that the evidence before the trial court (which included not only the exhibits to the bank’s motion but other evidence on file) was insufficient to establish current ownership. Justice Frost stated that she would reverse the summary judgment because Siu's affidavit failed to state that, in calculating the amount due and owing, all just and lawful offsets, payments and credits had been allowed.

Alice M. Wood, et al. v. HSBC Bank USA, No. 14-13-00389-CV (Tex. App.—Houston [14th Dist.] July 31, 2014)
 
A Texas home equity lien originated in violation of the home-equity lending provisions found in Tex. Const. art. XVI, section 50(a)(6) is voidable, not void; therefore, the residual statute of limitations under Tex. Civ. Prac.& Rem. Code § 16.051 bars claims for forfeiture of principal and interest under § 50(a)(6) as well as claims for monetary relief, where those claims are brought for the first time more than four years after the date of origination.

Alice and Daniel Wood obtained a home equity loan from Fremont Investment & Loan in July 2004, secured by a first lien on their homestead. In March 2012, the Woods sent HSBC Bank, the current holder of the lien, a "Notice of Request to Cure," in which they alleged that the lien was originated in violation of Tex. Const. art. XVI, section 50(a)(6), and demanded that HSBC cure the alleged violations. HSBC did not respond.

In July 2012, the Woods filed suit against HSBC, its loan servicer Ocwen Loan Servicing L.L.C. ("Ocwen"), and others, seeking forfeiture of principal and interest for constitutional violations; damages for breach of contract and fraud; and a declaratory judgment that the lien was void, that HSBC had failed to cure the alleged defects, and that HSBC must forfeit all principal and interest. HSBC and Ocwen moved for summary judgment, arguing that the Woods' claims were barred by limitations. The trial court granted summary judgment, and the Woods appealed.

The Court of Appeals affirmed. First, the court held that the constitutional defects rendered the lien voidable, not void. The court reasoned that, because a void act is null from the outset and may not be made valid by subsequent action, whereas a voidable act is binding until disaffirmed, and may be made valid by failure to have it annulled within the proper time or through ratification, and Article XVI, § 50(a)(6)(Q)of the Texas Constitution specifically provides for a cure, the constitutional defects in the origination of a home equity lien are properly characterized as voidable, rather than void. Second, the court held that, consistent with prior state and federal decisions, the four year residual statute of limitations under Tex. Civ. Prac. & Rem. Code § 16.051 applied to the alleged constitutional defects. Third, the court held that the legal injury for a constitutionally defective home equity lien occurs on the date the transaction closes, and the right to seek either forfeiture or monetary relief accrues on that date. The court rejected the Woods’ argument that the demand for a cure was a condition precedent to bringing their claims for monetary relief and held that limitations barred all of the Woods' claims from July 2008 onward.

Upcoming Luncheons

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“Doing Mandamus Right: Views from Inside and Outside the Courthouse,” by Tom Mitchell (Central Staff Attorney, First Court of Appeals), Nicholas Gray (Central Staff Attorney, Fourteenth Court of Appeals), and Cathy Smith (Vinson & Elkins)
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“Eight Gates for Expert Witnesses: Fifteen Years Later,” by Justice Harvey Brown (First Court of Appeals)
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November 20*
“What’s New in the 2014 Pattern Jury Charges: Changes and Challenges,” by Justice Tracy Christopher, Kent Sullivan, Justice Brett Busby, and Dan Linebaugh
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