Trends in the Texas Supreme Court

By Lynne Liberato, Mark Trachtenberg & Polly Fohn, Haynes and Boone, LLP

Evaluating trends in the Texas Supreme Court is reminiscent of the parable of the blind men and the elephant. Each one felt a different part of the elephant to learn what it was like. When they compared notes, they found that they completely disagreed.

As lawyers, we tend to “feel” the part of the Court’s jurisprudence that affects us most. So, for example, the Court has issued several workers compensation-related cases in the past couple of years but mention of them seldom turns up in the speeches and articles about significant cases directed to civil appellate lawyers. A “trend” is in the eye of the beholder.

So, we approach this evaluation of trends with the caveat that these are not “the” trends but some patterns as viewed by one set of appellate lawyers.

Anti-SLAPP (Anti-Strategic Lawsuits Against Public Participation)

Much of the Court’s work involves statutory interpretation. One of the statutes the Court has recently focused on is the anti-SLAPP statute, which authorizes a defendant to move to dismiss a claim involving the exercise of the right to free speech upon a showing that the communication was made in connection with a matter of public concern. TEX. CIV. PRAC. & REM. CODE § 27.001. Enacted in 2011, the Court frequently has clarified procedures to bring and defend against an anti-SLAPP motion to dismiss. No doubt more anti-SLAPP cases will find their way to the Supreme Court’s docket during the next few years.

While the purpose behind anti-SLAPP legislation appears directed at protecting First Amendment rights in defamation cases, the Court has interpreted what constitutes “public interest” broadly. The Court has noted the open-ended language in the statute extends anti-SLAPP to private as well as public communications.

So, in Lippincott v. Whisenhunt, the Court determined that a nurse’s suit for defamation arising out of disparaging e-mails sent by hospital administrators relating to the nurse’s work were covered by the anti-SLAPP statute. 462 S.W.3d 507, 509-10 (Tex. 2015). Because the act encompasses both public and private communications and health care services are a matter of public concern, the defendant hospital could file an anti-SLAPP motion to dismiss.

As for anti-SLAPP procedure, the process begins when a defendant files a motion to dismiss applying the test set forth in the statute. If the Court determines that the case is meritless, the lawsuit is dismissed and fees and potential sanctions are awarded against the filing party.

In In re Lipsky, the Court allowed the party defending against a motion to dismiss to rely on circumstantial evidence to make its required showing of a prima facia case to avoid dismissal. 460 S.W.3d 579, 589-91 (Tex. 2015). In Sullivan v. Abraham, the Court addressed the award of attorneys’ fees in an anti-SLAPP case. -- S.W.3d --, 2016 WL 1513674, at *4 (Tex. 2016). It held that the trial court has the discretion to determine whether a fee award is “reasonable,” but it cannot adjust the award based on “justice and equity.” Id.

For a thorough analysis of the anti-SLAPP statute, see Prather & Bland, “Bullies Beware: Safeguarding Constitutional Rights Through Anti-SLAPP in Texas,” 47 Tex. Tech. L.R. 725 (2015).

Public Information Act

The Court also has directed its attention to the Texas Public Information Act, the state equivalent of the Freedom of Information Act. The Court held favorably both for requestors and for parties seeking protection from disclosure. So, in Kallinen v. City of Houston, the Court gave requestors the option to bypass the attorney general and act on their own by filing suit challenging refusal of a governmental authority to produce information. 462 S.W.3d 25, 27-29 (Tex. 2015). Then, in Boeing v. Paxton, it extended protections from disclosure by giving private parties standing to protect competitively sensitive information. 466 S.W.3d 831, 839 (Tex. 2015). In Greater Houston Partnership v. Paxton, it clarified that private entities are only covered by the Act if they are “sustained” by public funds. 468 S.W. 3d 51, 61 (Tex 2015).

Premises Liability

Recently, the Court has addressed multiple cases involving premises liability. In one case, it determined that employers owe employees the same premises liability duty that other landowners owe to their invitees. That duty is to either make the premises safe or warn invitees of concealed dangers. Generally, the landowner owes no duty to protect an invitee against a dangerous condition that is open and obvious or known to the invitee. Austin v. Kroger, 465 S.W.3d 193, 202-04 (Tex. 2015).

In another case, it determined that a prior property owner is not liable under a negligent activity theory. Occidental Chem. v. Jenkins, 478 S.W.3d 640, 644, 647-48 (Tex. 2016). And, in a case of first impression, the Court found that lack of consent is an element of trespass, not an affirmative defense. Envtl. Processing Sys. v. FPL Farming, 457 S.W.3d 414, 425 (Tex. 2015). A final, but not exhaustive example is Abutahoun v. Dow Chemical Co., 463 S.W.3d 42 (Tex. 2015). In it, the Court held that the limitations on liability in Chapter 95 of the Civil Practice and Remedies Code may apply to an independent contractor’s negligence claims against a property owner, even when the claims are based on injuries arising out of the property owner’s negligent activities and not the independent contractor’s own work.

Insurance

The Court was generally, but not always, favorable to carriers in insurance coverage cases. In a decision favorable to the insured, it determined that Superfund proceedings by the EPA are a “suit” for purposes of triggering the duty to defend. McGinnes Indus. Maint. v. Pheonix Ins., 477 S.W.3d 786, 787 (Tex. 2015). It also determined that the insured tow truck driver may recover loss-of-use damages in total destruction cases. J & D Towing, LLC v. Am. Alternative Ins. Corp., 478 S.W.3d 649, 676 (Tex. 2016). In a case favorable to insurance companies, it excluded from coverage damage caused by both wind and water, based on certain clauses in the insurance policies. JAW The Pointe v. Lexington Ins. Co., 460 S.W.3d 597, 608 (Tex. 2016). And in In re Deepwater Horizon it answered “no coverage” to a certified question from the Fifth Circuit that asked if BP had coverage derived from sub-contractor TransOcean’s carriers. 470 S.W.3d 452, 455-56 (Tex. 2015).

Employment Cases

The Court has considered a number of employment cases, which is not a surprise given the sheer number of employment cases that are filed.

The Court appears generally favorable to employers, although not always so. For example, the Court found that a worker was in the course and scope of his employment when driving to a remote location and thus his widow was entitled to workers compensation benefits. SeaBright Ins. Co. v. Lopez, 465 S.W.3d 637, 643-45 (Tex. 2015). Conversely, the Court determined in a sexual harassment suit that no reasonable person would believe that a handful of lunch invitations amounted to sexual harassment. San Antonio Water Sys. v. Nicholas, 461 S.W.3d 131, 138 (Tex. 2015).

In two whistle blower suits, the Court determined that the statutory procedural requirements governing when whistle blowers must report challenged wrongdoing is strictly construed, and that report must be made to someone with “outward looking” law enforcement authority, not a supervisor with power only to oversee internal compliance. See Office of Att’y Gen. v. Weatherspoon, 472 S.W.3d 280, 282-83 (Tex. 2015); McMillen v. Tex. Health & Human Servs. Comm’n, -- S.W.3d --, 2016 WL 766799, at **1-3 (Tex. Feb. 26, 2016).

Arbitration

The Court continues to make vacating awards challenging. Most recently, in Hoskins v. Hoskins, the Court held that the Texas Arbitration Act sets out the exclusive grounds for vacating arbitration awards arising from agreements governed by that statute, and that common law vacatur grounds are no longer viable. -- S.W.3d --, 2016 WL 2993929, at *7 (Tex. May 20, 2016). The Court also has continued to enforce arbitration clauses against parties attempting to avoid arbitration in these recent cases: Royston Rayzor v. Lopez, 467 S.W.3d 494, 499-506 (Tex. 2015), where the Court enforced an arbitration agreement in an attorney-client contract that excluded claims made by the firm for recovery of its fees and expenses; G.T. Leach v. Sapphire, 458 S.W.3d 502, 519-22 (Tex. 2015), where the Court determined that the arbitrator, not the Court, decides procedural arbitrability issues; and Richmont Holding v. Superior Recharge Sys., 455 S.W.3d 573, 574-76 (Tex. 2014), in which the Court determined that a party did not waive the arbitration clause despite taking several actions in the trial court, including filing a cross action, moving to transfer venue, engaging in minimal discovery and delaying moving for arbitration.

Health Care

The Court has been reviewing statutes that impose procedural hurdles for plaintiffs in health care liability cases. It drew a line at injuries sustained in common areas in determining coverage by Chapter 74, the Texas Medical Liability Act (TMLA). Thus, the Court decided that a plaintiff suing a hospital for a slip and fall in an elevator lobby was not covered by the TMLA. Ross v. St. Lukes, 462 S.W.3d 496, 501-05 (Tex. 2015). The Court explained that there must be more of a relationship to health care than that the occurrence happened in a hospital. Id. at 504. The effect here was that the plaintiff was not required to obtain an expert report before filing suit. The fact patterns were similar in Reddic v. E. Tex. Med. Ctr. Reg’l Health Care, 474 S.W.3d 672 (Tex. 2015) and Galvan v. Mem’l Hermann Hosp. Sys., 476 S.W.3d 429 (Tex. 2015).

More recently, the Court found that a claim for post mortem fraud was a health care liability claim. Christis Health Gulf Coast v. Carswell, -- S.W.3d --, 2016 WL 2979718, at **4-6 (Tex. May 20, 2016). In this case, the effect of that determination was that a claim that the hospital began covering up deficient health care immediately following a patient’s death was barred by the act’s two-year statute of limitations provision. Id. at **7-8.

Procedure

Understandably, the Court continues to decide multiple procedural cases. Two of the most talked-about cases by the appellate bar concern jury charges.

In one, the Court determined that objections to a spoliation instruction that were not asserted at the charge conference were preserved in a pretrial response to a motion for sanctions. Wackenhut v. Gutierrez, 453 S.W.3d 917, 919-20 (Tex. 2015). That case followed a decision in 2014 that determined that as long as the parties have a “reasonable time” to review and object to the charge, the trial court has authority to set a deadline for charge objections that falls before the reading of the charge to the jury. King Fisher Marine v. Tamez, 443 S.W.3d 838, 845 (Tex. 2014).

In another procedural issue of interest to appellate lawyers, the Court held that an award of disgorgement does not need to be superseded on appeal. In re Longview Energy Co., 464 S.W.3d 353, 361 (Tex. 2015). This means that a potentially enormous judgment could get appealed with no bond.

While courts generally avoid interfering with rulings by trial judges during the course of a trial, the Supreme Court granted mandamus relief after a trial judge refused to exclude a corporate representative from portions of a temporary injunction hearing at which trade secret testimony was presented. In re M-I L.L.C., -- S.W.3d --, 2016 WL 2981342, at **3-8 (Tex. May 20, 2016).

Summary Judgment

Given how often grants of summary judgment are appealed, multiple cases address summary judgment standards and procedures. The law of summary judgment is mostly settled, but the Court continues to tweak the law. For example, in Farm Bureau Cty. Mut. Ins. Co. v. Rogers, the Court noted that even an order styled as one denying a motion for summary judgment can be final, noting that “the language of an order or judgment can make it final, even though it should have been interlocutory, if that language expressly disposes of all claims and all parties.” 455 S.W.3d 161, 163 (Tex. 2015). However, it found that the order before it was not final because neither the language in the judgment taxing court costs nor a Mother Hubbard clause disposed of the parties’ claims for attorney’s fees. Id. In Greene v. Farmers Insurance Exchange, the Court indirectly approved of language for severing issues and parties dismissed by a motion for partial summary judgment, thereby making that portion of the case final and appealable. 446 S.W.3d 761, 764 n.5 (Tex. 2014).

Energy

It is difficult to define “Energy” cases. But, narrowing the analysis to cases that could be classified as traditional oil and gas cases, the Court continues to consider important issues such as how to calculate royalty and overriding royalty interests, the treatment of production payments and the role of industry custom in interpreting written agreements. For example, in Chesapeake Expl., L.L.C. v. Hyder, 483 S.W.3d 870, 873-76 (Tex. 2016), the Court interpreted a contractual overriding royalty provision as being free from post-production costs. The Texas Oil and Gas Association has warned that the Court’s interpretation could “throw into dispute thousands of royalty provisions in oil and gas leases and overriding royalty instruments throughout Texas.” In Apache Deepwater, LLC v. McDaniel Partners, -- S.W.3d --, 2016 WL 766731 (Tex. Feb. 26, 2016), the Court held that termination of an oil and gas lease also extinguishes any production payment (or similar overriding royalty) created in an assignment of the lease. And in Kachina Pipeline Co., Inc. v. Lillis, 471 S.W.3d 445, 454 (Tex. 2015), the Court concluded that “industry custom cannot impose obligations beyond those within the [parties’] written agreement.

Plaintiffs v. Defendants

What constitutes a plaintiffs’ case can be hard to categorize. But, in a study of Texas Supreme Court cases performed by plaintiffs’ lawyer Jay Jackson, he reports that in 2015, the plaintiff won 36% of the time and the defendant won 57% of the time. Four opinions were split between the two. He further narrowed the analysis to 49 cases that are more likely to be divided by tort or tort-like cases (wrongful death, DTPA, fraud, insurance, whistleblower, etc.). Among those cases, the plaintiff won 31% of the time and the defendant 69% of the time. Compared to his earlier studies, he notes that there has been a narrowing between plaintiffs’ and defendants’ wins by about a third. See “Trends in the Texas Supreme Court,” Advanced Trial Strategies Course, State Bar of Texas (2016).

Conclusion

Looking for trends in the Supreme Court requires more conjecture than fact. The Court can only hear cases that are brought before it. So, when there is a new, significant statute such as anti-SLAPP, application of that new law will create a “trend.” To be sure, the only thing that is certain is that the Court focuses on cases that it considers important to the State. The substantive mix of those cases is often driven by advocates and the actions of the Legislature, not the Court itself.

Lynne Liberato, Mark Trachtenberg and Polly Fohn are appellate lawyers in the Houston office of Haynes and Boone.