Alice Marie Gandy v. Robert Williamson, Estate of Jimmy Glenn Williamson, Jimmy Williamson, P.C., Williamson & Rusnak, Cyndi Rusnak, and Cyndi Rusnak, PLLC ( 2021 )

Opinion issued May 27, 2021
In The
Court of Appeals
For The
First District of Texas
————————————
NO. 01-19-00335-CV
———————————
ALICE MARIE GANDY, ADVANTAGE TAX & PRINTING SERVICES,
INCORPORATED, ALICIA ANNETTE PARKS, ALISA WATTS, ALLEN
RAY WILSON, ALVIN SCALES, ANDREA BARABINO, ANGELA
SYKES, ANTHONY DILLON, APRIL DENT, AUGUSTINE AARON,
AUGUSTUS A. MITCHELL, AURURA CHAPMAN, BENNY LEE
CHANEK, BETTY BOARD, BILLY JEFFERSON, BOBBIE SPENCER,
BOBBY LEE PHILLIPS, BRANCH OF RIGHTEOUSNESS
FELLOWSHIP CHURCH, BRENDA J. DARDEN, BRIAN ANTHONY
BROWN, C & T FAST STOP, INCORPORATED, CARLEAN
SKINNER, CARLOS CORBITT, CECIL ODOM, JR., CHARLENE
TONEY, CHARLES ANDREW MONROE, CHARLES EDWARD
BROWN, CHARLIE SCALES, DR. CHARLOTTE KEYS, CHESTER
RAY FAWLEY, CHRISTOPHER DANIEL GOLDSBERRY,
CLARENCE JOSEPH MCNEAL, CLIFF TAYLOR, CRAIG ANTONIO
HARWELL, CURTIS STALLWORTH, DAISY ODOM, DANEE
RAQUEL AIKENS, DANIEL C. ARRINGTON, DEXTER TROTTER,
DIANNE TAYLOR, DORIS HOLDER, DOTS PLAY AND LEARN
CHILDCARE, LLC, DWAYNE KELVIN BLACKWELL, EDWARD
EARL THURMOND, EDWARD GRAY, EDWARD KIRKSEY,
EDWARD MICHAEL SMITH, EICHELBERGER CONSTRUCTION,
LLC, ELIZABETH S. DENNIS, EMMA JACKSON, ERIC LEONARD
HAYES, ERNEST FORD, JR., ERNEST RUELAND FERNANDEZ, JR.,
ERVIN T. MARSHALL, JR., EUGENE PAJEAUD, FELICIA LONDON,
FREDERICK EUGENE WALLACE, FRED RILEY, GAIL WARD,
GILRON TRAVIS, GLORIA DEAN SIPP, GREGORY WILLIAMS,
HENRIETTA W. THOMPSON, HERBERT WALKER, IMAD JABER,
JAMES CESSNA, JEANNIE FERRELL, JEFFERY SHANKS,
JENNIFER HOWARD, JOHN CALHOUN STEWART, JOHN MARK
O’NEAL, JOHNNY LEDBETTER, JR., JOHNNY R. RATLIFF,
JOSEPHINE BEATRICE CAMERON RHODES, JULIAN JOHN
RICHARD, KATHLEEN SMITH, KATTIE COFFEY PARTEE, KEITH
ROGERS, LASHOURN WHITT, LASHUNDA THOMAS F/K/A
LASHUNDA MOSELY, LADELL MASON, LARRY GREEN,
LASHANDERICK MCCALPINE, LATRICIA MCCARTY, LEKARITA
ALLEYNE, LENNIE LOUIS VALENTINE, LESTER FAIRLEY,
LILLIE RUTH MCNAIR, LINDA MORTON, LONNIE BARRY
MEEKS, SR., MARION BROKMEIER, MARY DAWSON WILLIAMS,
MAXINE MCCANTS, MELISSA WALLIS, MELVIN FIELDS,
MICHAEL MANSON MCNAIR, ODESSA WILLIAMS, OZELL
FARMER, PAMELA DENISE SHANKS, PATRICK EDMOND,
PATRICK GIBSON, PATSY DILLON ROBINS, PHILLIP BUSH,
PHILLIP WALDRON, RAY JOHNSON, ROBERT EARL PHILLIPS,
ROBERT SYKES, JR., ROMARO DEMANE MOORE, RONALD J.
BARABINO, SR., RONALD O. COTTON, ROSEMARY THOMPSON
BETHEA, ROSEMARY HUNT, ROSHAUNDA SHANETTE WALLEY,
RUSSELL BROKMEIER, SANQUANETT ALLEN, SHQUITA SMITH,
SONYA EDMOND, SONYA STALLWORTH, SUSAN KOCHAN,
SUSAN MARIE LEWIS, TERRY TYRONE SQUARE, THIS & THAT
REMODELING & CONSTRUCTION, LLC, TIJUANA LESHA
CHANEY, TIMOTHY JAMES WATTS, TIMOTHY WAYNE GERALD,
VALERIE WATKINS, VICKIE CARVER, WILLIAM ALVIN
ORCUTT, WILLIE KEYS, WILLIE TAYLOR, WILLIE THOMAS,
WYATT BERNARD MCCARTY, YOLANDA HUNT COOPER, AND
ZENOLA QUINN, Appellants
V.
ROBERT WILLIAMSON, AS INDEPENDENT EXECUTOR OF THE
ESTATE OF JIMMY GLENN WILLIAMSON, DECEASED, THE ESTATE
OF JIMMY GLENN WILLIAMSON, DECEASED, JIMMY WILLIAMSON,
P.C., WILLIAMSON & RUSNAK, CYNDI RUSNAK, CYNDI RUSNAK,
2
PLLC, MICHAEL A. POHL, LAW OFFICE OF MICHAEL A. POHL,
PLLC, Appellees
On Appeal from the Probate Court No. 2
Harris County, Texas
Trial Court Case No. 459,062-401
OPINION
Appellants1—135 individuals—challenge the trial court’s rendition of
summary judgment in favor of appellees, Robert Williamson, as independent
executor of the Estate of Jimmy Glenn Williamson, deceased, the Estate of Jimmy
Glenn Williamson, deceased, Jimmy Williamson, P.C., Williamson & Rusnak,
Cyndi Rusnak (“Cyndi”), Cyndi Rusnak, PLLC, Michael A. Pohl (“Michael”), and
Law Office of Michael A. Pohl, PLLC (collectively, “appellees”), in appellants’ suit
against appellees for civil barratry,2 civil conspiracy, aiding and abetting, and breach
1
We do not list appellants by name in the body of the opinion because of their large
number.
2
See generally TEX. GOV’T CODE ANN. § 82.0651. In 2011, the Texas Legislature
enacted Texas Government Code section 82.0651. See Act of May 5, 2011, 82d
Leg., R.S., ch. 94, § 2, sec. 82.0651, 2011 Tex. Gen. Laws 534, 535 (amended 2013)
(current version at TEX. GOV’T CODE ANN. § 82.0651). In 2013, the Texas
Legislature amended section 82.0651. See Act of May 15, 2013, 83d Leg., ch. 315,
§ 2, sec. 82.0651, 2013 Tex. Gen. Laws 1073, 1074 (current version TEX. GOV’T
CODE ANN. § 82.0651). The 2013 amendments apply to a suit concerning conduct
that occurred after September 1, 2013. In their briefing, appellants state that the
“2011 version,” i.e., the original version, of Texas Government Code section
82.0651 applies to this case.
3
of fiduciary duty. In four issues, appellants contend that the trial court erred in
granting appellees summary judgment.
We affirm.
Background3
On October 16, 2017, fifty-five appellants filed their original petition against
appellees. On December 15, 2017, appellants filed their first amended petition,
which added eighty more appellants to the suit.
In their first amended petition, appellants alleged that after the Deepwater
Horizon oil spill,4 Jimmy Glenn Williamson (“Jimmy”), a Texas lawyer,
individually and through his law firm, Jimmy Williamson, P.C., “concocted an illicit
barratry scheme . . . by unlawfully soliciting thousands of potential clients to bring
claims against” BP related to the Deepwater Horizon oil spill. Jimmy engaged his
law partner Cyndi, another Texas lawyer, and her law firm, Cyndi Rusnak, PLLC,
3
To the extent that any of the parties direct this Court to documents attached to their
briefing that are not otherwise contained in the appellate record, we note that the
attachment of documents as exhibits or appendices to an appellate brief does not
constitute a formal inclusion of such documents in the record for appeal, and we
have not considered matters outside of the record in our review. See McCann v.
Spencer Plantation Invs., Ltd., No. 01-16-00098-CV, 2017 WL 769895, at *4 n.5
(Tex. App.—Houston [1st Dist.] Feb. 28, 2017, pet. denied) (mem. op.).
4
See In re Deepwater Horizon, 739 F.3d 790, 795–96 (5th Cir. 2014) (explaining
“millions of barrels oil . . . spill[ed] into the Gulf of Mexico” after “[a] 2010
explosion aboard the Deepwater Horizon, an offshore drilling rig” that was leased
by British Petroleum Exploration & Production, Inc. (“BP”) and noting after oil spill
“[n]umerous lawsuits were filed against a variety of entities,” including BP
(emphasis omitted)).
4
to help him with the barratry scheme, and, together, Jimmy and Cyndi created a
general partnership, Williamson & Rusnak, to practice law. Jimmy and Cyndi also
engaged a third Texas lawyer, Michael, and his law firm, Law Office of Michael A.
Pohl, PLLC, to aid in the barratry scheme. Together they formed a “barratry joint
venture,” with each of them agreeing to “split the profits from any fruits of the
barratry joint venture with 40% of any attorney’s fees derived from the [Deepwater
Horizon] litigation going to [Michael] and 60% going to” Jimmy and Cyndi. Jimmy
and Cyndi “agreed to split their 60% of the fees according to the amount of resources
each put into the cases after [potential clients] had been improperly solicited.”
In furtherance of the barratry scheme, in April 2012, Michael met with Scott
Walker, who provided consulting, public relations, and marketing services to several
Mississippi companies. Michael told Walker that he and Jimmy sought to obtain
potential clients affected by the Deepwater Horizon oil spill, with a goal of
representing 100 Mississippi companies in their claims against BP. Michael
conveyed to Walker that he and Jimmy wanted to hire Walker to “provide services
to solicit [potential] clients” with claims against BP related to the Deepwater
Horizon oil spill. Michael told Walker that Jimmy “had worked to secure a 7.8
billion dollar settlement [agreement] with BP,” but Jimmy did not have a lot of
clients to participate in the settlement agreement.
5
A few days after the meeting between Michael and Walker, Jimmy met with
Walker and told him that “BP had structured [a] settlement [agreement] to include
the whole [S]tate of Mississippi and . . . there were literally thousands of businesses
and individuals who could be targeted for solicitation” to become clients. Because
Michael and Jimmy wanted to hire an additional person “with government contacts,”
“who could obtain governmental entities to file” claims against BP, Walker
introduced Michael and Jimmy to Steve Seymour, who was employed by Diamond
Consulting and who was “a public official in Hancock County, Mississippi.” When
Michael and Jimmy met with Seymour, they told him that they were trying to get
potential clients in Mississippi with claims against BP related to the Deepwater
Horizon oil spill and Jimmy was the “absolute best lawyer in the field in handling
[Deepwater Horizon] oil spill claims.” (Internal quotations omitted.)
On or about May 19, 2012, Michael and Jimmy met with Walker and
Seymour, and Jimmy “brought a stack of double sided, color flyers promoting the
[legal] services of” Jimmy and Michael. Jimmy and Michael told Walker and
Seymour to “use the flyers in their sales pitches to potential clients in an effort to
sell [clients] on hiring” Jimmy, Michael, and Cyndi for their claims against BP.
Jimmy and Michael instructed Walker and Seymour to call their friends and
acquaintances “to try to get them to hire” Jimmy, Michael, and Cyndi for their claims
related to the Deepwater Horizon oil spill and also “to make cold calls on people and
6
businesses they didn’t know.” Jimmy told Walker and Seymour that he also had a
PowerPoint presentation “to be used to ‘seal the deal’ on potential clients that were
hesitant,” and Jimmy gave Walker and Seymour attorney-client contracts “to be used
for signing up potential clients.” Jimmy instructed Walker and Seymour to have
potential clients sign blank attorney-contracts and then email the signed contracts to
him.
The specifics of the barratry scheme were also discussed at the May 19, 2012
meeting between Michael, Jimmy, Walker, and Seymour. Michael and Jimmy
explained that Jimmy would decide which groups of potential clients should be
targeted, would decide the barratry scheme’s marketing efforts, would provide
marketing materials to use in soliciting potential clients, and would meet with and
market himself, Jimmy Williamson, P.C., and Cyndi to potential clients with larger
claims against BP. Jimmy stated that he would “handle the overhead expenses[,]
including intake and staffing.” (Internal quotations omitted.) As for Michael, he
would handle Walker’s and Seymour’s compensation. And Cyndi would assist
“with the intake of the [potential clients’] claims, review the claims, terminate any
unsuitable claims, and . . . generally handle the processing of the claims” through
the BP settlement claim process. Cyndi also directed Walker to “go after [potential
clients with] claims that would produce the highest legal fees” and “to market to
[potential] clients in certain geographic locations.” (Internal quotations omitted.)
7
On or about May 25, 2012, Michael’s law firm, Law Office of Michael A.
Pohl, PLLC, entered into an agreement with Walker, Seymour, and a third person,
Terry Robinson, owner of Robinson Holdings, LLC. Under the agreement, Michael,
on behalf of the barratry scheme, agreed to pay Walker, Seymour, and Robinson—
all non-lawyers—thirty percent of the forty percent of attorney’s fees he was to
receive from the barratry joint venture. Walker, Seymour, and Robinson agreed to
split their thirty percent as follows: twelve percent to Walker, twelve percent to
Seymour, and six percent to Robinson. Over the next month Walker, Seymour, and
Robinson “distributed information about [Jimmy] to hundreds of Mississippians.”
(Internal quotations omitted.)
Later, Jimmy recruited another individual, Kirk Ladner, to join with Walker
and Seymour, telling Walker, Seymour, and Ladner that they would be
“multi-millionaires.” (Internal quotations omitted.) On July 15, 2012, Michael’s
law firm, Law Office of Michael A. Pohl, PLLC on behalf of the barratry scheme,
signed a new agreement with Walker, Seymour, and Ladner, under which Walker,
Seymour, and Ladner agreed to accept 22.5% of the forty percent of attorney’s fees
that Michael was to receive from the barratry joint venture. This new agreement
also ended the relationship with Robinson.
According to appellants, Walker, Seymour, and Ladner then formed a
company called Precision Marketing Group, LLC (“Precision Marketing Group”),
8
which was used as the “center of operations” for soliciting potential clients for
Michael, Jimmy, and Cyndi. (Internal quotations omitted.) Michael, Jimmy, and
Cyndi paid for “[t]he lease and furnishing and staff of th[e] company.”
To advance the barratry scheme, Michael and Jimmy also met Dane Maxwell,
whose company, CMV Investigations, LLC (“CMV Investigations”), provided
lawyers with investigation services. Michael and Jimmy recruited Maxwell and
CMV Investigations to solicit potential clients with claims against BP related to the
Deepwater Horizon oil spill. Maxwell formed a team of contract workers “to make
cold calls on potential clients.” As part of the barratry scheme, Michael and Jimmy
agreed to pay Maxwell $1,000 for each potential client that he and his team signed
up, plus expenses.
Appellants also alleged that the barratry scheme paid about $5 million in
“barratry pass through money” to Walker, Seymour, and Ladner for them to solicit
potential clients and for them to “accumulate potential clients for” Michael, Jimmy,
and Cyndi. (Internal quotations omitted.) Walker, Seymour, and Ladner, on behalf
of Michael, Jimmy, and Cyndi, used the money they received to solicit potential
clients with claims against BP. The barratry scheme paid Maxwell and CMV
Investigations about $2.47 million for their solicitation of potential clients for
Michael, Jimmy, and Cyndi.
9
According to appellants, essentially, a “barratry pyramid scheme” was
developed, with Michael, Jimmy, and Cyndi at the top directing the solicitation
efforts for potential clients. As part of this scheme, Michael, Jimmy, and Cyndi
would give money to Walker, Seymour, Ladner, and Maxwell, who would then pay
“case runners [to] work[] below” them. For instance, if Maxwell and CMV
Investigations received $1,000 from Michael, Jimmy, and Cyndi for a potential
client, Maxwell and CMV Investigations would give a “mid-level runner[]” working
below them, $100 to $250 of the $1,000 for recruiting the potential client. And the
mid-level runner would give a “low-level runner[]” who worked below him, $20 to
$30 of the $100 to $250 if she recruited a potential client while working under the
mid-level runner’s umbrella. In other words, as part of the barratry pyramid scheme,
low-level runners would receive $20 to $30 for each potential client that was
recruited, mid-level runners would receive $100 to $250, less the amount given to
the low-level runner for each potential client that was recruited, and Maxwell and
CMV Investigations would keep the remainder of the $1,000 given to them by
Michael, Jimmy, and Cyndi for each potential client that was recruited.
Along with providing money, Michael, Jimmy, and Cyndi also instructed
Walker, Seymour, Ladner, and Maxwell as well as other runners to “make cold calls
[on] potential clients” and “to go business to business[] [and] door to door” to contact
potential clients. Michael, Jimmy, and Cyndi told these individuals to tout Jimmy’s
10
experience as a plaintiffs’ lawyer who had participated in the original Deepwater
Horizon litigation and his experience with the BP settlement claim process. Jimmy
provided Walker, Seymour, Ladner, Maxwell, and the runners with promotional
materials to give to potential clients. The information given to potential clients
“always indicated that the potential client could have a lucrative [Deepwater Horizon
oil spill] claim [against BP], which naturally led to [Walker, Seymour, Ladner,
Maxwell, and the runners] presenting the [potential] client with [an attorney-client]
contract” for Michael, Jimmy, and Cyndi. The potential clients did not know that
Walker, Seymour, Ladner, and Maxwell or the runners were marketers, actively
soliciting potential clients on behalf of Michael, Jimmy, and Cyndi or that Michael,
Jimmy, and Cyndi were paying Walker, Seymour, Ladner, Maxwell, or the runners
to solicit and sign-up potential clients on their behalf. Sometimes when Walker,
Seymour, Ladner, Maxwell, or the runners were “not able to close [a] deal with a
potential client,” Jimmy would meet with the potential client and attempt to sign him
or her up.
Appellants also alleged that one low-level runner, Jacqueline Taylor, was
recruited to solicit clients for Michael, Jimmy, and Cyndi through CMV
Investigations. Taylor owned a beauty salon in Mississippi and was contacted by
Karen Boykin, another runner, “who was targeting small business owners.” Boykin
told Taylor that she had a claim against BP related to the Deepwater Horizon oil spill
11
and persuaded Taylor to hire Michael and Jimmy to file a claim on her behalf. Taylor
completed a blank attorney-client contract that Jimmy had provided to Boykin.
Boykin then told Taylor about the money that she was being paid to solicit potential
clients and gave her the business card of Monica Chaney, a “BP Claims Consultant”
for CMV Investigations. After Taylor called Chaney, Taylor was also hired to solicit
potential clients for Michael, Jimmy, and Cyndi. Chaney told Taylor that Michael
and Jimmy had employed CMV Investigations, and Chaney gave Taylor blank
attorney-client contracts for Williamson & Rusnak and Law Office of Michael A.
Pohl, PLLC.
According to Taylor, she was trained to target business owners with her
solicitations and “when those claims ran out,” she was told to target farmers and
landowners. Taylor was given a map and “told to focus on particular zones.” She
was paid $20 to $30 for each potential client that she brought in, and Chaney was
paid $100 to $150 for each potential client that Taylor brought in. Taylor would
send Chaney potential clients’ information every week and she was “paid through a
cash card from Wal-Mart.” Taylor was also reimbursed for any expenses associated
with her solicitation of potential clients. Taylor was paid to solicit more than 100
potential clients for Michael, Jimmy, and Cyndi, and she never told the potential
clients that she was being paid to solicit them.
12
Another runner, Magdalena Santana, was approached by Seymour in July
2012 and recruited by Michael and Jimmy for a “marketing position” that required
her to “find [potential] clients [with claims against BP related to the Deepwater
Horizon oil spill] and sign them up” to be represented legally by Michael, Jimmy,
and Cyndi. (Internal quotations omitted.) According to Santana, her position
required her “to make cold calls on business owners and managers to try to get them
to sign blank [attorney-client] contracts with [Michael] and [Jimmy].” (Internal
quotations omitted.) Santana was paid $250 for each potential client that she “signed
up.” (Internal quotations omitted.) Santana received payment through Precision
Marketing Group, and Michael told Santana that he could not pay her directly for
her solicitation efforts because “it was illegal for him to pay [her] directly, and that’s
why the money had to go through some company.” (Alteration in original) (Internal
quotations omitted.)
As for potential clients, Michael told Santana to “target businesses in the
high-paying settlement zones[,] such as beachfront properties, hotels, taxi
companies, commercial fisherman, nightclubs, and other tourism businesses.”
(Internal quotations omitted.) Jimmy instructed Santana “to go business to
business[] [and] door to door asking people if they had losses from the [Deepwater
Horizon] oil spill.” (Internal quotations omitted.) Jimmy, like Michael, also told
Santana to “target businesses in high paying [settlement] zones and in tourism zones,
13
since they were getting [higher] payouts” from the BP settlement claims process.
(Internal quotations omitted.) And she was told “to target churches because they
were easy as they didn’t have to provide tax returns.” (Internal quotations omitted.)
If she had trouble signing up a “big fish” as a potential client, then Michael and
Jimmy would visit that potential client personally. (Internal quotations omitted.)
Appellants also alleged that Santana was given a map showing the
high-paying settlement zones, and, like other runners, she was given a binder with
blank attorney-client contracts for Michael, Jimmy, and Cyndi and pamphlets with
Jimmy’s name on them to distribute to potential clients. And Santana was emailed
blank attorney-client contracts for Michael and Jimmy.
Santana solicited seventy-seven potential clients in her first week in her
“marketing position” and she was “paid bonuses personally” by Jimmy for signing
up “the big fish clients.” (Internal quotations omitted.) Michael and Jimmy both
knew that Santana was “cold-calling businesses to get [potential clients with
Deepwater Horizon oil spill] claims” against BP, and Michael and Jimmy gave
Santana “specific instructions to knock on doors to drum up clients for them.”
(Internal quotations omitted.) In total, Santana signed up 1,500 potential clients for
Michael and Jimmy and none of them were her friends, family members, or
colleagues. After Santana solicited potential clients for Michael, Jimmy, and Cyndi,
14
Michael would meet her at a restaurant to sign the attorney-client contracts that she
had obtained from potential clients.
According to appellants, by the end of 2012, up to ten thousand individuals
had been improperly solicited through Michael, Jimmy, and Cyndi’s barratry
scheme. At that time, Jimmy and Cyndi informed Michael that Jimmy wanted to
stop participating in the scheme. But Michael continued to fund and operate the
barratry scheme on his own, and he directed Walker, Seymour, Ladner, and the
runners to send any new potential clients only to him. Michael handled the claims
of these potential clients as a partner of Pohl & Berk, LLP (“Pohl & Berk”). Pohl &
Berk also accepted some of the potential clients that the original barratry joint
venture had rejected, and Michael handled other claims related to the Deepwater
Horizon oil spill on his own, through his law firm, or as a joint venture with other
law firms.
Appellants also alleged that in April 2013, Walker learned that he was under
investigation by federal authorities, unrelated to the barratry scheme, and Michael,
Jimmy, and Cyndi then became fearful that their barratry scheme would be
discovered. Thus, “[i]n an effort to distance themselves from [any] misconduct,
[they] decided to belatedly decline or [to] terminate representation of the[ir]
improperly solicited” clients. Beginning in May 2013 and continuing on, Michael,
Jimmy, and Cyndi terminated the attorney-client relationship with about 8,000
15
improperly solicited clients through letters. The letters sent by Michael, Jimmy, and
Cyndi, “gave the impression that [they] were terminating the[ir] representation [of a
client] either because the client’s claim was no[t] good or because of the client’s
fault.” Michael, Jimmy, and Cyndi worded the letters to discourage their former
clients from seeking new legal representation because they feared that the barratry
scheme would be discovered. Because Michael, Jimmy, and Cyndi owed their
clients fiduciary duties, the clients believed that their claims against BP related to
the Deepwater Horizon oil spill were not worth pursing or that they could not
proceed on their claims. A “majority of [the] terminated clients” were dissuaded
from pursuing their claims against BP by Michael, Jimmy, and Cyndi, making them
unable to collect substantial awards through the BP settlement claims process.
Additionally, some terminated clients were barred from bringing their otherwise
viable claims against BP because certain deadlines passed soon after Michael,
Jimmy, and Cyndi terminated their representation of their former clients.
According to appellants, in 2017, Michael, Jimmy, and Cyndi’s terminated
clients first learned of the barratry scheme devised by Michael, Jimmy, and Cyndi.
Yet, Jimmy still had his assistant, Brenda Kellen, make calls to the terminated clients
in 2017, advising those clients that any claims of barratry against Michael, Jimmy,
or Cyndi were a “scam.” (Internal quotations omitted.)
16
Appellants’ first amended petition contains additional allegations for each
individual appellant about the solicitation of that appellant in connection with the
alleged barratry scheme. For instance, as to Alice Marie Gandy, the petition states
that Gandy, a hair stylist and beauty salon owner, “received an unsolicited phone
call from a woman calling to solicit her on behalf of” Michael, Jimmy, and Cyndi.
“The primary purpose of the personal solicitation was to obtain business for”
Michael, Jimmy, and Cyndi and to “advertise their services.” “The solicitor was
paid (or offered payment) by [Michael], [Jimmy], and[] [Cyndi] to solicit
employment.” Gandy did not have a previous attorney-client or family relationship
with the solicitor or with Michael, Jimmy, or Cyndi. “The woman [who called
Gandy] told her that she was eligible to receive a settlement because she owned a
business that was losing profits and that [Michael, Jimmy, and Cyndi] could file a
claim on [Gandy’s] behalf against BP” related to the Deepwater Horizon oil spill.
According to appellants, each appellant was improperly solicited in connection with
Michael’s, Jimmy’s, and Cyndi’s barratry scheme.
In their first amended petition, appellants brought claims against appellees for
civil barratry,5 civil conspiracy, and aiding and abetting.6 As to their civil barratry
5
See Act of May 5, 2011, 82d Leg., R.S., ch. 94, § 2, sec. 82.0651(a), (b), 2011 Tex.
Gen. Laws 534, 535 (amended 2013).
6
Appellants also brought negligence claims, in the alternative, against appellants,
which they later non-suited.
17
claims, appellants alleged that appellees, with the intent to obtain an economic
benefit, violated several provisions of Texas Penal Code section 38.12, which
prohibits barratry,7 and Texas Disciplinary Rule of Professional Conduct 7.03
concerning barratry.8 According to appellants, appellees engaged in improper
solicitation of potential clients and procured contracts for legal services, or
employment, as a result.
As for their civil conspiracy and aiding and abetting claims, appellants alleged
that appellees were “members of a combination of two or more persons,” “[t]he
object of the combination was to accomplish an unlawful purpose by unlawful
means,” i.e., the improper solicitation of appellants and other persons, and,
[t]he members . . . had a meeting of the minds on the object or course
of action[:] (1) to pay, give or offer a person money to solicit
employment on behalf of [appellees]; (2) in knowingly financing the
commission of barratry and solicitation in violation of the laws of
Texas; [(3)] by investing funds [appellees] knew or believed were
intended to further the commission of barratry and/or; (4) in knowingly
accepting employment within the scope of a person’s license as an
attorney that violates the laws of Texas concerning barratry.
7
See TEX. PENAL CODE ANN. § 38.12(a)(4), (b).
8
See TEX. DISCIPLINARY RULES PROF’L CONDUCT R. 7.03(a)–(d), reprinted in TEX.
GOV’T CODE ANN., tit. 2, subtit. G, appl. A. Appellants alleged that appellees
violated “the[] rule[] by paying or offering to pay non-lawyers millions of dollars to
solicit and refer prospective clients to them for representation in the [Deepwater
Horizon] litigation obtained through improper solicitation and accepting
employment procured as a result of this barratry.” Appellants were all persons who
were improperly solicited by conduct that violated Texas Disciplinary Rule of
Professional Conduct 7.03.
18
Appellees committed an unlawful, overt act in furtherance of the barratry and
improper solicitation, and appellees were jointly and severally liable for each other’s
violations of the Texas Penal Code, Texas Government Code section 82.0651, and
the Texas Disciplinary Rules of Professional Conduct, all of which prohibit barratry.
Appellees answered,9 generally denying the allegations in appellants’ petition
and asserting certain affirmative defenses, including that appellants’ claims were
barred by the applicable statute of limitations.
Appellees then moved for partial summary judgment on appellant’s civil
barratry, civil conspiracy, and aiding and abetting claims,10 arguing that they were
entitled to judgment as a matter of law because appellants’ civil barratry claims were
barred by either a two-year statute of limitations or a four-year statute of limitations
and neither the discovery rule, the Hughes11 tolling doctrine, the doctrine of
fraudulent concealment, nor the continuing-tort doctrine applied to appellants’
claims. Further, because appellants’ civil barratry claims were time barred,
appellees argued that appellants’ civil conspiracy and aiding and abetting claims
were also time barred as they were derivative of the civil barratry claims.
9
Appellees filed separate answers. The appellate record contains these answers as
well as any amended answers.
10
Appellees did not move for summary judgment on appellants’ then-pending
alternative negligence claims.
11
See Hughes v. Mahaney & Higgins, 821 S.W.2d 154 (Tex. 1991).
19
Appellees attached certain exhibits to their motion, including the affidavits of
Cyndi and Michael and a copy of a “Contract of Employment” listing Michael and
Jimmy as parties to the agreement. The summary-judgment evidence shows that the
last time that any appellants signed a representation agreement or an attorney-client
contract12 related to their claims against BP for the Deepwater Horizon oil spill was
in May 2013. Thus, appellees asserted that appellants’ civil barratry claims would
have accrued on or before the date each appellant signed a representation agreement
or an attorney-client contract with appellees, with the latest date being in May 2013.
In their response to appellees’ partial-summary-judgment motion, appellants
argued that appellees were not entitled to judgment as a matter of law on their civil
barratry claims because a four-year statute of limitations applied, appellees did not
establish when each appellant’s civil barratry claim accrued, appellees did not negate
the application of the discovery rule, which tolls the statute of limitations until a
plaintiff discovers or should have discovered the facts establishing the elements of
her cause of action, and the Hughes and McClung13 tolling doctrines applied to
appellants’ civil barratry claims. Appellants also argued that because their civil
barratry claims were not time barred, their civil conspiracy and aiding and abetting
12
The representation agreement or attorney-client contract also includes a power of
attorney.
13
See McClung v. Johnson, 620 S.W.2d 644 (Tex. App.—Dallas 1981, writ ref’d
n.r.e.).
20
claims were also not time barred. Appellants attached certain exhibits to their
response.
In their reply, appellees asserted that appellants’ civil barratry claims accrued
when the alleged improper solicitation occurred, appellants pleaded that the
solicitation occurred before the execution on any representation agreements or
attorney-client contracts signed by appellants, and appellants signed representation
agreements or attorney-client contracts more than four years before appellants sued
appellees for civil barratry. Appellees also asserted that the discovery rule did not
apply to appellants’ civil barratry claims, and even if it did, the statute of limitations
would not be tolled beyond the date that appellants executed their representation
agreement or attorney-client contracts because they knew or should have known the
facts that made the basis of their civil barratry claims before executing those
documents. Appellees reiterated that appellants could not rely on the Hughes tolling
doctrine to assert that their claims were not time barred.
The trial court granted appellees partial summary judgment on appellants’
civil barratry, civil conspiracy, and aiding and abetting claims “based on [appellees’]
statute of limitations defense” and dismissed those claims.
21
Meanwhile, before the trial court’s ruling on appellees’ initial
partial-summary-judgment motion, appellants filed a third amended petition,14
alleging, for the first time, breach of fiduciary duty claims against appellees.15 As
to their breach of fiduciary duty claims, appellants alleged that a fiduciary
relationship existed between “some” appellants and appellees and appellees owed
those appellants the following fiduciary duties: the duty to act with loyalty and
utmost good faith; the duty to act with absolute perfect candor, openness, and
honestly, and without deception or concealment, no matter how slight; the duty to
refrain from self-dealing, which extended to dealings with persons whose interests
were closely identified with those of the fiduciary; the duty to act with integrity of
the strictest kind; the duty of fair, honest dealing; the duty of full disclosure, that is,
the duty not to conceal matters that might influence a fiduciary to act in a matter that
was prejudicial to appellants; the duty to represent appellants with undivided loyalty;
and the duty to make full and fair disclosure of every facet regarding the matters
material to the representation. Further, according to appellants, appellees knowingly
14
The record does not contain a second amended petition, nor does it reflect that one
was ever filed. It appears that appellants filed their original petition on October 16,
2017, their first amended petition on December 15, 2017, and a third amended
petition on June 8, 2018. Because appellants titled their June 8, 2018 petition as
their “Third Amended Petition,” we refer to it as such.
15
Because appellants’ third amended petition was filed before the trial court’s ruling
on appellees’ motion for partial summary judgment, it continued to allege
appellants’ previously asserted civil barratry, civil conspiracy, aiding and abetting,
and alternative negligence claims against appellees.
22
and intentionally breached the above fiduciary duties by concealing that they had
obtained the right to represent appellants through improper solicitation methods—
the barratry joint venture or the barratry scheme. And appellees benefitted from their
breach by obtaining attorney’s fees from appellants and by concealing the improper
solicitation so that they could argue here that the statute of limitations barred
appellants’ civil barratry claims.
As to damages, appellants, in their third amended petition, sought damages
under Texas Government Code section 82.0651, exemplary damages based on
appellees’ intentional breach of their fiduciary duty, and the “disgorgement,
forfeiture and repayment of all monies, fees and expenses paid to [appellees] as a
result of [appellees’] procurement of agreements and receipt of attorney’s fees in
violation of the laws and rules prohibiting barratry and for [appellees’] breach of
fiduciary duty.”
Appellees then moved for partial summary judgment16 on appellants’ breach
of fiduciary duty claims, arguing that they were entitled to judgment as a matter of
law because appellants’ breach of fiduciary duty claims were barred by the
applicable four-year statute of limitations, appellants’ breach of fiduciary duty
claims were “just a recast of [appellants’] time-barred [civil] barratry claims,” the
Hughes tolling doctrine did not apply to appellants’ breach-of-fiduciary-duty claims,
16
Appellants’ alternative negligence claims were still pending at the time.
23
and appellants could not recover as damages the $10,000 civil barratry penalty
provided for by Texas Government Code section 82.0651. Appellants attached
certain exhibits to their motion, including the affidavits of Cyndi and Michael and a
copy of the “Contract of Employment” listing Michael and Jimmy as parties to the
agreement.
In their response to appellees’ partial-summary-judgment motion, appellants
asserted that their breach-of-fiduciary-duty claims were not time barred, their claims
did not accrue until June 26, 2018 because they did not suffer a legal injury as a
result of any breach of fiduciary duty until the trial court dismissed appellants’ civil
barratry claims against appellees, the discovery rule applied to appellants’ claims,
the Hughes and McClung tolling doctrines applied to toll the applicable statute of
limitations, and appellees were “not entitled to summary judgment on [appellants’]
claim[s] for” the civil barratry penalty.
The trial court, without specifying the grounds, granted appellees partial
summary judgment on appellants’ breach-of-fiduciary-duty claims and dismissed
those claims. After appellants non-suited their remaining alternative negligence
claims, the trial court dismissed the negligence claims and entered a final
judgment.17
17
See Park Place Hosp. v. Estate of Milo, 909 S.W.2d 508, 510 (Tex. 1995).
24
Standard of Review
We review a trial court’s decision to grant summary judgment de novo. Tex.
Mun. Power Agency v. Pub. Util. Comm’n of Tex., 253 S.W.3d 184, 192 (Tex. 2007);
Valence Operating Co. v. Dorsett, 164 S.W.3d 656, 661 (Tex. 2005). In conducting
our review, we take as true all evidence favorable to the non-movant, and we indulge
every reasonable inference and resolve any doubts in the non-movant’s favor.
Valence Operating, 164 S.W.3d at 661; Provident Life & Accident Ins. Co. v. Knott,
128 S.W.3d 211, 215 (Tex. 2003). If a trial court specifies the ground on which the
motion for summary judgment was granted, we should consider whether the trial
court correctly granted summary judgment on that basis. See Cincinnati Life Ins.
Co. v. Cates, 927 S.W.2d 623, 626 (Tex. 1996); Primo v. Garza, No.
01-14-00480-CV, 2015 WL 777999, at *1 (Tex. App.—Houston [1st Dist.] Feb. 24,
2015, no pet.) (mem. op.). In the interest of judicial economy, we may also consider
other grounds that the movant preserved for review and the trial court did not rule
on. See Cates, 927 S.W.2d at 626; Primo, 2015 WL 777999, at *1. If the trial court
grants summary judgment without specifying the grounds for granting the motion,
we must uphold the trial court’s judgment if any of the asserted grounds are
meritorious. Beverick v. Koch Power, Inc., 186 S.W.3d 145, 148 (Tex. App.—
Houston [1st Dist.] 2005, pet. denied).
25
To prevail on a summary-judgment motion, a movant has the burden of
establishing that he is entitled to judgment as a matter of law and there is no genuine
issue of material fact. TEX. R. CIV. P. 166a(c); Cathey v. Booth, 900 S.W.2d 339,
341 (Tex. 1995). When a defendant moves for summary judgment, he must either
(1) disprove at least one essential element of the plaintiff’s cause of action or
(2) plead and conclusively establish each essential element of his affirmative
defense, thereby defeating the plaintiff’s cause of action. Cathey, 900 S.W.2d at
341; Yazdchi v. Bank One, Tex., N.A., 177 S.W.3d 399, 404 (Tex. App.—Houston
[1st Dist.] 2005, pet. denied). Once the defendant meets his burden, the burden shifts
to the plaintiff, the non-movant, to raise a genuine issue of material fact precluding
summary judgment. See Centeq Realty, Inc. v. Siegler, 899 S.W.2d 195, 197 (Tex.
1995); Transcon. Ins. Co. v. Briggs Equip. Tr., 321 S.W.3d 685, 691 (Tex. App.—
Houston [14th Dist.] 2010, no pet.). The evidence raises a genuine issue of fact if
reasonable and fair-minded fact finders could differ in their conclusions in light of
all the summary-judgment evidence. Goodyear Tire & Rubber Co. v. Mayes, 236
S.W.3d 754, 755 (Tex. 2007).
Civil Barratry
In their first issue, appellants argue that the trial court erred in granting
appellees summary judgment on their civil barratry claims because a four-year
statute of limitations applies to civil barratry claims brought under Texas
26
Government Code section 82.0651(a) and the trial court erred in not applying either
the discovery rule or the Hughes and McClung tolling doctrines to appellants’ civil
barratry claims.
“Barratry is the solicitation of employment to prosecute or defend a claim with
intent to obtain a personal benefit.” State Bar of Tex. v. Kilpatrick, 874 S.W.2d 656,
658 n.2 (Tex. 1994); Nguyen v. Watts, 605 S.W.3d 761, 773 (Tex. App.—Houston
[1st Dist.] 2020, pet. filed); see also Neese v. Lyon, 479 S.W.3d 368, 376 (Tex.
App.—Dallas 2015, no pet.) (“The ordinary meaning of barratry is vexatious
incitement to litigation, especially by soliciting potential legal clients.” (citing
Barratry, BLACK’S LAW DICTIONARY (10th ed. 2014))). Barratry is a criminal
offense under Texas Penal Code section 38.12. See TEX. PENAL CODE ANN. § 38.12;
see also State v. Mays, 967 S.W.2d 404, 408–09 (Tex. Crim. App. 1998) (“Barratry
by solicitation has been criminalized in the State of Texas since 1901, when the
[Texas] [P]enal [C]ode was amended to outlaw the fomenting of litigation by
attorneys at law by soliciting employment.” (internal quotations omitted)); Neese,
473 S.W.3d at 376 (noting barratry “has long been a crime in Texas”).
Texas law also provides a private right of action for barratry for a client or a
person solicited by conduct violating Texas Penal Code section 38.12(a) and (b)18 or
18
See TEX. PENAL CODE ANN. § 38.12(a), (b) (“Barratry and Solicitation of
Professional Employment”).
27
rule 7.03 of the Texas Disciplinary Rules of Professional Conduct of the State Bar
of Texas,19 regarding barratry by attorneys and other persons. See TEX. GOV’T CODE
ANN. § 82.0651 (current version, as amended in 2013); Sullo & Bobbit P.L.L.C. v.
Abbott, 536 Fed. Appx. 473, 474–76 (5th Cir. 2013) (“The civil barratry
statute . . . provides that persons who are solicited by lawyers in a manner prohibited
by law or ethics rules may file a civil action against the person who committed
barratry . . . .”); Neese, 479 S.W.3d at 376 (noting criminal prohibition of barratry is
found in Texas Penal Code Chapter 38 and Texas Disciplinary Rule of Professional
Conduct 7.03 addresses barratry); James v. Calkins, 446 S.W.3d 135, 149 (Tex.
App.—Houston [1st Dist.] 2014, pet. denied) (“Section 82.0651 of the [Texas]
Government Code provides for civil liability for prohibited barratry.”); see also TEX.
GOV’T CODE ANN. § 82.065(c).20 In 2011, the Texas Legislature enacted Texas
19
See TEX. DISCIPLINARY RULES PROF’L CONDUCT R. 7.03 (“Prohibited Solicitations
and Payments”).
20
In 1989, the Texas Legislature enacted Texas Government Code section 82.065
which, at the time, addressed contingency-fee agreements and barratry. See Act of
May 27, 1989, 71st Leg., R.S., ch. 866, § 3, sec. 82.065, 1989 Tex. Gen. Laws 3855,
3857 (amended 2011 and 2013) (current version at TEX. GOV’T CODE ANN.
§ 82.065); see also Gauthia v. Arnold & Itkin, L.L.P., No. 01-19-00143-CV, 2020
WL 5552458, at *2 & nn.4–5 (Tex. App.—Houston [1st Dist.] Sept. 17, 2020, no
pet.) (mem. op.). Before section 82.065’s enactment, Texas law did not recognize
any private right of action for barratry for a client who had been improperly
solicited. See Neese v. Lyon, 479 S.W.3d 368, 378–82 (Tex. App.—Dallas 2015,
no pet.); see also Nguyen v. Watts, 605 S.W.3d 761, 774–75 (Tex. App.—Houston
[1st Dist.] 2020, pet. filed). After section 82.065 was amended, it was not limited
to the commission of barratry in the context of contingency-fee agreements. The
current version of section 82.065 addresses barratry and “[a]ny contract for legal
services.” TEX. GOV’T CODE ANN. § 82.065(b); see also Holliday v. Gray, No.
28
Government Code section 82.0651, which contained the following relevant21
provisions:
(a) A client may bring an action to void a contract for legal services
that was procured as a result of conduct violating the laws of this [S]tate
or the Texas Disciplinary Rules of Professional Conduct of the State
Bar of Texas regarding barratry by attorneys or other persons.
(b) A client who prevails in an action under [s]ubsection (a) shall
recover from any person who committed barratry:
(1) all fees and expenses paid to that person under the
contract;
(2) the balance of any fees and expenses paid to any other
person under the contract, after deducting fees and expenses
awarded based on a quantum meruit theory as provided by
[Texas Government Code] [s]ection 82.065(c);
(3) actual damages caused by the prohibited conduct; and
(4) reasonable and necessary attorney’s fees.
....
(e) This section shall be liberally construed and applied to promote
its underlying purposes, which are to protect those in need of legal
services against unethical, unlawful solicitation and to provide efficient
and economical procedures to secure that protection.
05-18-01146-CV, 2020 WL 1969503, at *6 n.2 (Tex. App.—Dallas Apr. 24, 2020,
pet. denied) (mem. op.) (noting original version of section 82.065 provided private
right of action related only to contingency-fee agreements, but current version
applies to any contract for legal services).
21
As previously noted, appellants, in their briefing, state that their civil barratry claims
are brought under the original version of Texas Government Code section
82.0651(a), as enacted in 2011. See, e.g., Neese, 479 S.W.3d at 377 n.3 (noting
2013 amendments to section 82.0651 did not apply to case).
29
Act of May 5, 2011, 82d Leg., R.S., ch. 94, § 2, sec. 82.0651(a), (b), (e), 2011 Tex.
Gen. Laws 534, 535 (amended 2013) (current version at TEX. GOV’T CODE ANN.
§ 82.0651); see also Neese, 479 S.W.3d at 377, 382–83, 385 (noting section 82.0651,
as written above, applied to conduct that occurred from September 1, 2011 to August
31, 2013 and explaining Texas Legislature amended section 82.0651 in 2013).22
Thus, under Texas Government Code section 82.0651(a) and (b), clients, such as
22
In 2013, the Texas Legislature amended the original version of Texas Government
Code section 82.0651, including sections (a) and (b), which now provide:
(a) A client may bring an action to void a contract for legal
services that was procured as a result of conduct violating [s]ection
38.12(a) or (b), Penal Code, or [r]ule 7.03 of the Texas Disciplinary
Rules of Professional Conduct of the State Bar of Texas, regarding
barratry by attorneys or other persons, and to recover any amount that
may be awarded under [s]ubsection (b). A client who enters into a
contract described by this subsection may bring an action to recover
any amount that may be awarded under [s]ubsection (b) even if the
contract is voided voluntarily.
(b) A client who prevails in an action under [s]ubsection (a)
shall recover from any person who committed barratry:
(1) all fees and expenses paid to that person under the
contract;
(2) the balance of any fees and expenses paid to any other
person under the contract, after deducting fees and expenses
awarded based on a quantum meruit theory as provided by
[Texas Government Code] [s]ection 82.065(c);
(3) actual damages caused by the prohibited conduct;
(4) a penalty in the amount of $10,000; and
(5) reasonable and necessary attorney’s fees.
Act of May 15, 2013, 83d Leg., ch. 315, § 2, sec. 82.0651(a), (b), 2013 Tex. Gen.
Laws 1073, 1074 (current version TEX. GOV’T CODE ANN. § 82.0651(a), (b)).
30
appellants, may bring an action to void a contract for legal services that was procured
as a result of conduct that violated the laws of the State of Texas or the Texas
Disciplinary Rules of Professional Conduct regarding barratry, and, should those
clients prevail, they are entitled to recover all fees and expenses paid under the
barratrous contract to the person who committed barratry, plus other remedies such
as actual damages caused by the barratry and attorney’s fees incurred in the
prosecution of a barratry action. See Act of May 5, 2011, 82d Leg., R.S., ch. 94, § 2,
sec. 82.0651(a), (b), 2011 Tex. Gen. Laws 534, 535 (amended 2013); Neese, 479
S.W.3d at 382–83, 385.
A. Statute of Limitations and Accrual
Fifty-five appellants filed suit against appellees on October 16, 2017, alleging
claims for civil barratry under the original version of Texas Government Code
section 82.0651(a). About two months later, on December 15, 2017, appellants filed
their first amended petition, adding eighty more appellants and continuing to allege
civil barratry claims against appellees under section 82.0651(a).
The trial court granted appellees summary judgment on appellants’ civil
barratry claims “based on [appellees’] statute of limitations defense.” See Cates,
927 S.W.2d at 626 (if trial court specifies ground on which summary judgment was
granted, we should consider whether trial court correctly granted summary judgment
on that basis). It is an affirmative defense that a statute of limitations bars a claim.
31
TEX. R. CIV. P. 94. Appellants and appellees disagree as to whether a two-year
statute of limitations or a four-year statute of limitations applies to appellants’ civil
barratry claims brought under the original version of Texas Government Code
section 82.0651(a).
As we have recognized, Texas Government Code section 82.0651 does not
have an express statute of limitations period to be applied to a civil barratry claim.
See Nguyen, 605 S.W.3d at 780; see also Act of May 5, 2011, 82d Leg., R.S., ch.
94, § 2, sec. 82.0651, 2011 Tex. Gen. Laws 534, 535 (amended 2013); In re
Rosenthal & Watson, P.C., 612 B.R. 507, 563 (Bankr. W.D. Tex. 2020) (“There is
no specific statute of limitations for bringing a civil barratry claim in Texas.”). Yet
we have held that a two-year statute of limitations applies to civil barratry claims
brought under either the current version of section 82.0651(c) or the original version
of section 82.0651(c), as enacted in 2011. See Nguyen, 605 S.W.3d at 780–81
(explaining whether Court applied “the 2011 or [the] 2013 version” of section
82.0651(c), “the outcome or analysis of th[e] case” was unchanged); see also TEX.
CIV. PRAC. & REM. CODE § 16.003(a) (“Two-Year Limitations Period”); Williams v.
Khalaf, 802 S.W.2d 651, 654 (Tex. 1990) (holding for tort not expressly governed
by statute of limitations, we presume tort is “a trespass” that is covered by two-year
statute of limitations of section 16.003(a) (internal quotations omitted)). This may
indicate that a two-year statute of limitations should apply to all civil barratry claims
32
brought under the original version of Texas Government Code section 82.0651,
including a claim under the original version of section 82.0651(a). See Jaster v.
Comet II Constr., Inc., 382 S.W.3d 554, 561 (Tex. App.—Austin 2012) (cautioning
against statutory interpretation that would require courts to parse nature of
undeveloped claims with potentially case-dispositive results), aff’d, 438 S.W.3d 556(Tex. 2014). But this Court was not asked to determine in Nguyen whether a
two-year or four-year statute of limitations applied to a civil barratry claim brought
under either the current version or the original version of Texas Government Code
section 82.0651(a).
We note that our sister appellate court has held that a four-year statute of
limitations applies to civil barratry claims brought under the original version of
Texas Government Code section 82.065(b).23 See Neese, 479 S.W.3d at 383–84.
And we have agreed, following Neese, that civil barratry claims brought under the
original version of Texas Government Code section 82.065(b) are governed by a
four-year statute of limitations. See Gauthia v. Arnold & Itkin, L.L.P., No.
01-19-00143-CV, 2020 WL 5552458, at *7 (Tex. App.—Houston [1st Dist.] Sept.
23
The original version of Texas Government Code section 82.065(b), enacted in 1989,
provided: “A contingent fee contract for legal services is voidable by the client if it
is procured as a result of conduct violating the laws of this [S]tate or the Disciplinary
Rules of the State Bar of Texas regarding barratry by attorneys or other persons.”
See Act of May 27, 1989, 71st Leg., R.S., ch. 866, § 3, sec. 82.065(b), 1989 Tex.
Gen. Laws 3855, 3857 (amended 2011 and 2013).
33
17, 2020, no pet.) (mem. op.). Thus, this could signify that a four-year statute of
limitations should apply to civil barratry claims brought under the original version
Texas Government Code section 82.0651(a) because both section 82.065(b) and
section 82.0651(a) address barratry claims filed by a client when an attorney-client
contract has been signed. See, e.g., In re Rosenthal & Watson, P.C., 612 B.R. at 563
(relying on Neese in applying four-year statute of limitations to civil barratry claim
under Texas law). And after section 82.065(b) was amended by the Texas
Legislature in 2011 to remove its application to only contingency-fee contracts, the
2011 amended provision is much like the original version of Texas Government
Code section 82.0651(a) that is at issue in this case. Compare Act of May 5, 2011,
82d Leg., R.S., ch. 94, § 2, sec. 82.0651(a), 2011 Tex. Gen. Laws 534, 535 (amended
2013) (“A client may bring an action to void a contract for legal services that was
procured as a result of conduct violating the laws of this [S]tate or the Texas
Disciplinary Rules of Professional Conduct of the State Bar of Texas regarding
barratry by attorneys or other persons.”), with Act of May 5, 2011, 82d Leg., R.S.,
ch. 94, § 1, sec. 82.065(b), 2011 Tex. Gen. Laws 534, 534 (amended 2013) (“Any
contract for legal services is voidable by the client if it is procured as a result of
conduct violating the laws of this [S]tate or the Texas Disciplinary Rules of
Professional Conduct of the State Bar of Texas regarding barratry by attorneys or
other persons.”).
34
Here, we need not determine whether a two-year or four-year statute of
limitations applies to a civil barratry claim brought under the original version of
Texas Government Code section 82.0651(a), as enacted in 2011, because appellees
assert, as they did in the trial court, that even if a four-year statute of limitations
applies to appellants’ civil barratry claims those claims are still time barred.
Appellees, as the parties asserting the affirmative defense of statute of
limitations and as the movants for summary judgment, bore the burden of
establishing as a matter of law that appellants’ civil barratry claims were time barred.
See KPMG Peat Marwick v. Harrison Cty. Houston Fin. Corp., 988 S.W.2d 746,
748 (Tex. 1999); Richardson v. Allstate Tex. Lloyd’s, 235 S.W.3d 863, 865 (Tex.
App.—Dallas 2007, no pet.). To do so, appellees must have (1) conclusively proven
when the cause of action accrued and (2) negated the discovery rule if it applied and
had been pleaded or otherwise raised. KPMG Peat Marwick, 988 S.W.2d at 748;
see also Nguyen, 605 S.W.3d at 782. If appellees established that the statute of
limitations barred appellants’ civil barratry claims, appellants were required to
adduce summary-judgment proof raising a fact issue in avoidance of the statute of
limitations. See KPMG Peat Marwick, 988 S.W.2d at 748.
A cause of action accrues and the statute of limitations begins to run when
(1) the allegedly wrongful act was committed and caused an injury or (2) when the
facts come into existence that authorize a party to seek a judicial remedy. United
35
Healthcare Servs., Inc. v. First St. Hosp. LP, 570 S.W.3d 323, 335 (Tex. App.—
Houston [1st Dist.] 2018, pet. denied); see also Gauthia, 2020 WL 5552458, at *6.
This is true even if all resulting damages have not yet occurred. Schlumberger Tech.
Corp. v. Pasko, 544 S.W.3d 830, 834 (Tex. 2018); see also Gauthia, 2020 WL
5552458, at *6. Determining the accrual date is a question of law. Knott, 128
S.W.3d at 221; see also Gauthia, 2020 WL 5552458, at *6.
Since its 2011 enactment, the purpose of the Texas Government Code section
82.0651 has been “to protect those in need of legal services against unethical,
unlawful solicitation and to provide efficient and economical procedures to secure
that protection.” Act of May 5, 2011, 82d Leg., R.S., ch. 94, § 2, sec. 82.0651(e),
2011 Tex. Gen. Laws 534, 535 (amended 2013); see also Nguyen, 605 S.W.3d at
782. Consistent with this purpose, a person, including a client, has the right to be
free from solicitation that violates the laws of the State of Texas or the Texas
Disciplinary Rules of Professional Conduct regarding barratry. See Nguyen, 605
S.W.3d at 782–83; see also Act of May 5, 2011, 82d Leg., R.S., ch. 94, § 2, sec.
82.0651, 2011 Tex. Gen. Laws 534, 535 (amended 2013). It also necessarily follows
that a plaintiff suffers a “legal injury” under Texas Government Code section
82.0651(a) when she is solicited through improper conduct that violates the laws of
the State of Texas or the Texas Disciplinary Rules of Professional Conduct regarding
barratry. See Nguyen, 605 S.W.3d at 782–83 (internal quotations omitted); see also
36
Murphy v. Campbell, 964 S.W.2d 265, 270 (Tex. 1997) (defining “legal injury” as
“an injury giving cause of action by reason of its being an invasion of a plaintiff’s
right” (internal quotations omitted)); Gauthia, 2020 WL 5552458, at *6–7 (civil
barratry claim accrued when defendants allegedly solicited plaintiffs to retain
defendants to represent them).
Here, appellants alleged that appellees improperly solicited appellants and
procured a contract for legal services as a result. Appellants must show improper
solicitation to prevail on their civil barratry claims. See Tex. Law Shield LLP v.
Crowley, 513 S.W.3d 582, 586, 589 & n.6, 590 (Tex. App.—Houston [14th Dist.]
2016, pet. denied) (explaining solicitation is relevant for claims brought under Texas
Government Code section 82.0651(a) by a client, and based on allegations in
petition, section 82.0651(a) “require[d] proof that each contract was obtained as a
result of a paid solicitation”); see also Neese, 479 S.W.3d at 385 (holding civil
barratry claim “requires a client to prove more than that the defendant violated the
laws or disciplinary rules regarding barratry”). Thus, we look to the date or dates of
the alleged improper solicitation to determine when appellants’ civil barratry claims
accrued. See Gauthia, 2020 WL 5552458, at *7 (“Solicitation occurs at the moment
the purported case runner communicates in person with a prospective client about
legal representation for an existing legal problem.”).
37
Appellees did not present summary-judgment evidence showing the exact
date on which each appellant was improperly solicited. But appellants alleged in
their petition that each appellant was improperly solicited with the primary purpose
of obtaining business and employment for Michael, Jimmy, and Cyndi, and this
solicitation occurred before any appellants signed a contract. See Tex. Dep’t of
Corrections v. Herring, 513 S.W.2d 6, 9 (Tex. 1974); Martz v. Weyerhaeuser Co.,
965 S.W.2d 584, 588 (Tex. App.—Eastland 1998, no writ). Appellees, with their
partial-summary-judgment motion, did include evidence establishing the date on
which each appellant signed a representation agreement or an attorney-client
contract related to appellants’ claims against BP for the Deepwater Horizon oil spill.
And that evidence shows that May 2013 was the last time that any appellant signed
a representation agreement or an attorney-client contract related to her claim against
BP.24 This means that the complained-of improper solicitation of appellants by
24
In their opening brief, appellants argue that the trial court erred in granting appellees
summary judgment on appellants’ breach of fiduciary duty claims because the
affidavit of Cyndi, which was attached to appellees’ partial-summary-judgment
motion on appellants’ breach of fiduciary duty claims, was conclusory and “lacked
the necessary factual sufficiency to constitute summary judgment evidence.” But
this argument does apply to the summary-judgment evidence that accompanied
appellees’ motion for partial summary judgment on appellants’ civil barratry, civil
conspiracy, and aiding and abetting claims, which appellants did not challenge in
their briefing. Here, appellants do not argue that the trial court erred in granting
appellees summary judgment on appellants’ civil barratry, civil conspiracy, or
aiding and abetting claims because the evidence attached to appellees’ motion was
conclusory or “lacked the necessary factual sufficiency to constitute summary
judgment evidence.” See TEX. R. APP. P. 38.1(f), (i); see also Gonzales v. Thorndale
Coop. Gin & Grain Co., 578 S.W.3d 655, 657 (Tex. App.—Houston [14th Dist.]
38
appellees had to have occurred on or before the date each appellant signed her
representation agreement or attorney-client contract—the latest being in May 2013.
See Gauthia, 2020 WL 5552458, at *6–7 (civil barratry claim accrued when
defendants allegedly solicited plaintiffs to retain defendants to represent them);
Nguyen, 605 S.W.3d at 782–83. Thus, appellees, on summary judgment, established
that appellants’ civil barratry claims had to have accrued on or before May 2013.
See Gauthia, 2020 WL 5552458, at *6–7; Nguyen, 605 S.W.3d at 782–83.
As noted, fifty-five appellants filed suit against appellees on October 16,
2017, alleging claims for civil barratry. On December 15, 2017, appellants filed
their first amended petition, adding eighty more appellants to the suit, who also
alleged civil barratry claims against appellees. No matter whether a two-year or
four-year statute of limitations applies to appellants’ civil barratry claims brought
under the original version of Texas Government Code section 82.0651(a), we
conclude that appellees proved as a matter of law that more than four years had
passed since appellants’ claims accrued. Still, because appellants pleaded that the
discovery rule applied to their civil barratry claims, we now consider whether
appellees also conclusively negated applying the discovery rule to appellants’
claims.
2019, no pet.) (“As the appellant, [he] bore the responsibility to frame the issues and
arguments for his appeal; and we have no discretion to create an issue or argument
not raised in the appellant’s brief.”).
39
B. Discovery Rule
The discovery rule is a limited exception to the statute of limitations. Comput.
Assocs. Int’l Inc. v. Altai, Inc., 918 S.W.2d 453, 455, 457 (Tex. 1996). The discovery
rule defers accrual of a cause of action until the plaintiff knew or, exercising
reasonable diligence, should have known of the facts giving rise to the cause of
action. HECI Expl. Co. v. Neel, 982 S.W.2d 881, 886 (Tex. 1998); see also
ExxonMobil Corp. v. Lazy R Ranch, LP, 511 S.W.3d 538, 542–43 (Tex. 2017) (“[A]
claim accrues when injury occurs, not afterward when the full extent of the injury is
known.”). A plaintiff need not know that she has a cause of action. Instead, she
must only know “the facts giving rise to the cause of action.” Altai, Inc., 918 S.W.2d
at 455. The discovery rule applies in limited circumstances where “the nature of the
injury incurred is inherently undiscoverable and the evidence of the injury is
objectively verifiable.” Id. at 456.
“An injury is inherently undiscoverable if it is by nature unlikely to be
discovered within the prescribed limitations period despite due diligence.” S.V. v.
R.V., 933 S.W.2d 1, 7 (Tex. 1996). An injury is objectively verifiable when the facts
on which liability is predicated can be proven by “direct, physical evidence.” Id.The term “legal injury” is defined as “an injury giving cause of action by reason of
its being an invasion of a plaintiff’s right.” Murphy, 964 S.W.2d at 270 (internal
quotations omitted).
40
Appellants argue that the discovery rule applies to their civil barratry claims
brought under the original Texas Government Code section 82.0651(a) because
barratry is inherently undiscoverable and evidence of such claims is objectively
verifiable. Appellants assert that “a lay victim will certainly be unlikely to discover
the barratry within the pr[e]scribed limitations period” and “the discovery rule
should categorically apply to civil barratry claims, just as it has been categorically
applied to legal[-]malpractice claims.”
In response, appellees argue, as they did in the trial court, that the discovery
rule does not apply to appellants’ civil barratry claims because appellants’
“injury”—the alleged improper solicitation—was not inherently undiscoverable as
“a person always knows when [she] receives an unsolicited phone call or in-person
visit,” “the discovery rule does not toll limitations until the [plaintiff] knows that the
defendant’s conduct was wrongful,” and appellants never asserted that they were
unaware of the alleged improper solicitations in this case. Appellees also assert that
appellants cannot rely on the application of the discovery rule in legal-malpractice
cases.
This Court recently addressed the discovery rule in the context of civil barratry
claims in two cases, Nguyen and Gauthia. In Nguyen, the plaintiffs pleaded that the
discovery rule tolled the accrual of the statute of limitations on their civil barratry
claims brought under Texas Government Code section 82.0651(c). 605 S.W.3d at
41
770–71, 781–82. When the defendants then moved for summary judgment on the
plaintiffs’ civil barratry claims, asserting that the claims were barred by the statute
of limitations, the trial court granted the defendants summary judgment, concluding
that the discovery rule did not toll the statute of limitations for the claims that were
based on improper solicitation. Id. at 771–72, 779–80, 782.
On appeal, this Court considered whether the discovery rule applied to the
plaintiffs’ civil barratry claims brought under Texas Government Code section
82.0651(c). Id. at 781–84. In doing so, we noted that the Texas Supreme Court has
“restricted the discovery rule to exceptional cases to avoid defeating the purposes
behind” a statute of limitations. Id. at 782 (quoting Via Net v. TIG Ins. Co., 211
S.W.3d 310, 313 (Tex. 2006)); see also S.V., 933 S.W.2d at 6, 24 (application of
discovery rule “should be few and narrowly drawn”; statute of limitations has benefit
of precluding stale or spurious claims). We then sought to determine whether the
legal injury suffered by the plaintiffs under section 82.0651(c) was inherently
undiscoverable, recognizing that the legal question of whether an injury is inherently
undiscoverable “is decided on a categorical rather than case-specific basis; the focus
is on whether a type of injury rather than a particular injury was discoverable.”
Nguyen, 605 S.W.3d at 782–83.
As in this case, we determined in Nguyen that the legal injury suffered by a
plaintiff under Texas Government Code section 82.0651(c) occurs when he is
42
improperly solicited in violation of Texas Penal Code section 38.12 or rule 7.03 of
the Texas Disciplinary Rules of Professional Conduct. Id. And the plaintiffs in
Nguyen knew they had been improperly solicited at the time the solicitation
occurred. Id. at 783. An injury cannot be inherently undiscoverable when a plaintiff
knows enough facts to file suit but fails to do so only because he does not know the
law. Id. Based on the nature of the civil barratry claim, a plaintiff knows about the
facts giving rise to his claim under section 82.0651(c) at the time that they occur;
that is, he knows about the solicitous conduct that the statute makes actionable. Id.
We acknowledged the plaintiffs’ argument that a plaintiff who receives a prohibited
solicitation cannot discover his legal injury because he will not know that the
solicitation violated the law, but we disagreed that the accrual of a barratry claim
should be deferred until the plaintiff learns that the law prohibited an attorney’s
conduct. See id. at 783–84.
In concluding that the discovery rule did not toll the statute of limitations of
the plaintiffs’ civil barratry claims because a claim under Texas Government Code
section 82.0651(c) does not involve the type of injury that is inherently
undiscoverable, we rejected the plaintiffs’ reliance on legal-malpractice cases to
support their assertion that the discovery rule should be applied to civil barratry
claims. See id. Ultimately, we held that “[i]t is the plaintiff’s knowledge of the
conduct constituting a prohibited solicitation, and not his knowledge of the law, that
43
triggers the accrual of the [civil barratry] claim.” Id. at 784. Thus, a plaintiff’s civil
barratry claim under section 82.0651(c) “accrues when he is solicited by the conduct
prohibited in th[e] provision,” and the discovery rule does not toll the applicable
statute of limitations. Id.
More recently, in Gauthia, this Court addressed whether the discovery rule
applied to the plaintiffs’ civil barratry claims brought under the original version
Texas Government Code section 82.065(b), which allowed a client who hired an
attorney as a result of barratry to sue for rescission of an unlawful contingency-fee
contract. 2020 WL 5552458, at *2, *5–8. In that case, the plaintiffs pleaded that
the discovery rule applied to their civil barratry claims brought under Texas
Government Code section 82.065 and tolled the statute of limitations. Id. at *2. The
defendants moved for summary judgment on the plaintiffs’ civil barratry claims,
asserting that the statute of limitations barred the claims, and although the plaintiffs
argued in their summary-judgment response that “the discovery rule precluded
summary judgment based on the statute of limitations,” the trial court disagreed and
granted the defendants summary judgment. Id. at *3–4.
On appeal, this Court sought to determine whether the discovery rule tolled
the statute of limitations accrual date for the plaintiffs’ civil barratry claims brought
under the original version of Texas Government Code section 82.065(b). Id. at *6–
8. The plaintiffs argued that the discovery rule applied to their civil barratry claims
44
because the nature of their legal injuries was inherently undiscoverable; “they could
not have discovered their legal injuries because they did not know that the prohibited
solicitation violated the law.” Id. at *7. The plaintiffs relied on legal-malpractice
cases and asserted that their civil barratry claims under section 82.065(b) were
analogous to legal-malpractice claims, which the Texas Supreme Court has
determined are inherently undiscoverable. Id.
We determined that the plaintiffs’ reliance on legal-malpractice cases was
erroneous because unlike a legal-malpractice claim the plaintiffs did not need
knowledge of the law to perceive their claims—to discover that the defendants had
solicited them. Id. As we explained, the plaintiffs “did not need to know they could
sue [the defendants]; rather, they only needed to know the facts giving rise to their
claims.” Id. at *8. The plaintiffs’ legal injuries were not inherently undiscoverable
because they were aware of the facts giving rise to their claims based on the improper
solicitation when the solicitation occurred. Id. Thus, we held that the discovery rule
did not toll the statute of limitations for the plaintiffs’ civil barratry claims brought
under the original version of Texas Government Code section 82.065(b) because the
claims based on the solicitous conduct did not involve the type of injury that was
inherently undiscoverable. Id. “It is the plaintiff[s’] knowledge of the conduct
constituting a prohibited solicitation, and not [their] knowledge of the law, that
triggers accrual of the claim.” Id. (internal quotations omitted).
45
Here, we see no reason to stray from our previous decisions about civil
barratry claims and the discovery rule. Appellants, in their petition, alleged how
each individual appellant was solicited—either by telephone or in person. For
instance, as to Gandy, the petition states:
Gandy received an unsolicited phone call from a woman calling to
solicit her on behalf of [Michael, Jimmy, and Cyndi]. The primary
purpose of the personal solicitation was to obtain business for [Michael,
Jimmy, and Cyndi] and to advertise their services. The solicitor[, i.e.,
the woman,] was paid (or offered payment) by [Michael, Jimmy, and
Cyndi] to solicit employment. [Gandy] had no previous
attorney[-]client or family relationship with the solicitor []or [Michael,
Jimmy, and Cyndi]. The [solicitor] told [Gandy] that she was eligible
to receive a settlement because she owned a business that was losing
profits and that the [Michael, Jimmy, and Cyndi] could file a claim on
her behalf against BP.
Appellants’ legal injuries were not inherently undiscoverable because appellants
were aware of the facts giving rise to their claims based on improper solicitation at
the time the solicitations occurred. See id. at *7–8; Nguyen, 605 S.W.3d at 782–84.
In other words, appellants knew about the solicitations at the time that they were
occurring, and they knew about the solicitous conduct that makes Texas Government
Code section 82.0651 actionable. See Nguyen, 605 S.W.3d at 782–84. “It is the
plaintiff[s’] knowledge of the conduct constituting a prohibited solicitation, and not
[their] knowledge of the law” that is important. Gauthia, 2020 WL 5552458, at *8
(internal quotations omitted).
46
Although appellees did not present summary-judgment evidence showing the
exact date on which each appellant was improperly solicited, they did establish the
date on which each appellant signed a representation agreement or an attorney-client
contract related to their claims against BP for the Deepwater Horizon oil spill. And
the summary-judgment evidence attached to appellees’ partial-summary-judgment
motion shows that May 2013 was the last time that any appellant signed a
representation agreement or an attorney-client contract for her claim against BP.
This means that the complained-of improper solicitations of appellants by appellees
had to have occurred on or before the date each appellant signed her representation
agreement or attorney-client contract—the latest being in May 2013. And
appellants’ legal injuries were not inherently undiscoverable because appellants
were aware of the facts giving rise to their claims based on improper solicitation
before May 2013. See Gauthia, 2020 WL 5552458, at *8. We conclude that
appellees established as a matter of law that the discovery rule did not toll the statute
of limitations for appellants’ civil barratry claims.25 See id.25
Although appellants, in their briefing, seek to analogize legal-malpractice claims to
civil-barratry claims brought under the original version of Texas Government Code
section 82.0651(a) to assert that the discovery rule should apply to the toll the statute
of limitations in this case, appellants’ reliance on legal-malpractice cases is
misplaced, particularly because any alleged improper solicitation would have
occurred before the formation of the attorney-client relationship in this case. See
generally Gauthia, 2020 WL 5552458, at *7–8 (determining legal-malpractice
cases not applicable to analysis of discovery rule and civil-barratry claims).
47
C. Hughes and McClung Tolling Doctrines
Appellants next assert that the Hughes and McClung tolling doctrines should
have been applied to their civil barratry claims brought under the original version of
Texas Government Code section 82.0651(a), and when they are applied, summary
judgment on appellants’ civil barratry claims is improper.
In Hughes v. Mahaney & Higgins, the Texas Supreme Court considered the
proper application of the statute of limitations in a legal-malpractice case when the
attorney allegedly committed malpractice while providing legal services in the
prosecution or defense of a claim that had resulted in litigation. 821 S.W.2d 154,
155–57 (Tex. 1991). There, the plaintiffs hired an attorney who filed suit on their
behalf. Id. at 155. But while representing the plaintiffs in their underlying suit, the
attorney allegedly committed legal malpractice. Id. at 155–56. After the appeals in
their underlying suit were exhausted, the plaintiffs filed a legal-malpractice claim
against their attorney based on errors made by the attorney in the plaintiffs’
underlying suit. Id. at 156. The attorney moved for summary judgment asserting
that the two-year statute of limitations barred the plaintiffs’ legal-malpractice claim
against him. Id.
The Supreme Court held that the statute of limitations for the plaintiffs’
legal-malpractice claim was tolled until the appeals in the plaintiffs’ underlying suit
were exhausted. Id. at 155–57. As the court explained: “[W]hen an attorney
48
commits malpractice while providing legal services in the prosecution or defense of
a claim which results in litigation, the legal injury and discovery rules can force the
client into adopting inherently inconsistent litigation postures in the underlying case
and in the malpractice case.” Id. at 156. Thus, “[l]imitations are tolled for the second
cause of action [against the attorney] because the viability of the second cause of
action depends on the outcome of the first [in the underlying suit].” Id. at 157. In
essence, in Hughes, the court established a special tolling rule applicable to a precise
set of circumstances: “[W]hen an attorney commits malpractice in the prosecution
or defense of a claim that results in litigation, the statute of limitations on the
malpractice claim against the attorney is tolled until all appeals on the underlying
claim are exhausted.” Id.
Appellants’ civil barratry claims do not present the untenability conflict that
the Texas Supreme Court recognized in Hughes. The reason for tolling the statute
of limitations in a Hughes-type legal-malpractice case is to prevent a client from
having to argue in her underlying lawsuit that her attorney did not err or that the
attorney’s error did not impact the outcome of the lawsuit, while arguing at the same
time in her legal-malpractice suit that her attorney did err and the error harmed her
underlying suit.26 See id. at 155–57; see also Apex Towing Co. v. Tolin, 41 S.W.3d
26To prove a legal-malpractice claim, the plaintiff must establish that: (1) the attorney
owed the plaintiff a duty, (2) the attorney breached that duty, (3) the breach
49
118, 121 (Tex. 2001) (without tolling of statute of limitations in legal-malpractice
cases when attorney commits malpractice in prosecution or defense of claim that
results in litigation, “the legal-injury rule and the discovery rule [could] force a client
into the untenable position of having to adopt inherently inconsistent litigation
postures in the underlying case and the malpractice case”).
Appellants’ civil barratry claims are based on improper solicitation of
appellants by appellees before an attorney-client contract was ever signed by
appellants. Thus, the solicitation—the improper conduct that creates appellants’
claims—is not malpractice that is committed in the prosecution or defense of a claim.
See Erikson v. Renda, 590 S.W.3d 557, 566–68 (Tex. 2019). And as a result, the
policy reasons that justify suspending the statute of limitations until the completion
of litigation on legal-malpractice claims involving malpractice in the prosecution or
defense of a claim that results in litigation in a Hughes-type legal-malpractice case,
do not apply here.
The Texas Supreme Court has confirmed that the tolling doctrine set out in
Hughes only applies to certain legal-malpractice cases involving attorney
malpractice in the prosecution or defense of a claim that results in litigation. See id.
at 559 (“Hughes tolling is animated by several policy considerations unique to
proximately caused the plaintiff’s injuries, and (4) damages occurred. Belt v.
Oppenheimer, Blend, Harrison & Tate, Inc., 192 S.W.3d 780, 783 (Tex. 2006).
50
malpractice claims, but it is a ‘clear and strict,’ ‘categorical,’ and ‘bright-line rule’
applicable only to the category of legal-malpractice claims falling within the
articulated paradigm.”); Apex Towing, 41 S.W.3d at 122 (noting “strict application
of the Hughes tolling rule” needed and courts should apply Hughes tolling rule “to
the category of legal-malpractice cases encompassed within its definition”); Murphy,
964 S.W.2d at 272; see also Bloom v. Aftermath Pub. Adjusters, Inc., 902 F.3d 516,
518 (5th Cir. 2018) (rule in Hughes does not “sweep broadly” and has been limited
by Texas Supreme Court); Vacek Grp., Inc. v. Clark, 95 S.W.3d 439, 442–47 (Tex.
App.—Houston [1st Dist.] 2002, no pet.) (noting strict application of Hughes tolling
rule and holding it did not apply to legal-malpractice claim based on errors
committed by attorneys in course of conducting transactional work); Hoover v.
Gregory, 835 S.W.2d 668, 672 (Tex. App.—Dallas 1992, writ denied) (“[W]e
interpret Hughes narrowly and decide that its application should be limited to cases
involving legal malpractice.” (emphasis omitted)).
For these reasons, we decline to extend the Hughes tolling doctrine and by
applying it to appellants’ civil barratry claims brought under the original version of
Texas Government Code section 82.0651(a).
Appellants also assert that the McClung tolling doctrine should be applied to
their civil barratry claims. In McClung v. Johnson, the Dallas Court of Appeals, in
a legal-malpractice case, held that “a cause of action for legal malpractice accrues
51
when the act or default occurs and damages are ascertainable; but that . . . the statute
[of limitations] is tolled” for as long as the attorney-client relationship exists. 620
S.W.2d 644, 645–47 (Tex. App.—Dallas 1981, writ ref’d n.r.e.). This tolling
doctrine is no longer good law in the context of legal-malpractice cases. See Willis
v. Maverick, 760 S.W.2d 642, 645 n.2 (Tex. 1988); McCraine v. Chamberlain,
Hrdlicka, White, Williams & Martin, P.C., No. 14-04-00793-CV, 2006 WL 278276,
at *5 (Tex. App.—Houston [14th Dist.] Feb. 7, 2006, pet. denied) (mem. op.); Estate
of Degley v. Vega, 797 S.W.2d 299, 303 n.3 (Tex. App.—Corpus Christi–Edinburg
1990, no writ) (noting Texas Supreme Court expressly disapproved of McClung’s
approach to tolling).27
We decline to apply the McClung tolling doctrine to appellants’ civil barratry
claims brought under the original version of Texas Government Code section
82.0651(a).
27
We note that appellants when discussing the McClung tolling doctrine and its
alleged application to their breach of fiduciary duty claims in their opening brief,
refer this Court to our previous opinion in Vacek Group, Inc. v. Clark to assert that
the tolling doctrine in McClung “has never been abolished.” 95 S.W.3d 439, 442
(Tex. App.—Houston [1st Dist.] 2002, no pet.) (legal-malpractice case). However,
in Vacek Group, this Court did not approve of the McClung tolling doctrine, nor did
we apply it in that case; we simply mentioned appellant’s reliance on the doctrine
in connection with his argument that the statute of limitations was tolled for his
legal-malpractice claims. See id. Vacek Group does not support appellants’
assertion that the McClung tolling doctrine should be applied to appellants’ civil
barratry claims.
52
In sum, appellees conclusively proved that appellants’ civil barratry claims
brought under the original version of Texas Government Code section 82.0651(a)
accrued more than four years before appellants filed suit and appellees established
that neither the discovery rule, the Hughes tolling doctrine, nor the McClung tolling
doctrine applied to appellants’ claims. We thus hold that the trial court did not err
granting appellees summary judgment on appellants’ civil barratry claims.
We overrule appellants’ first issue.
Conspiracy and Aiding and Abetting
In their second issue, appellants argue that the trial court erred in granting
appellees summary judgment on their civil conspiracy and aiding and abetting
claims because these claims are derivative, they share a statute of limitations period
with the underlying tort, and appellants’ civil barratry claims are not time barred so
neither are their civil conspiracy and aiding and abetting claims.28
“[Civil] [c]onspiracy is a derivative tort because ‘a defendant’s liability for
conspiracy depends on participation in some underlying tort for which the plaintiff
seeks to hold at least one of the named defendants liable.’” W. Fork Advisors, LLC
28
The Texas Supreme Court has not expressly decided whether Texas recognizes a
cause of action for aiding and abetting. See First United Pentecostal Church of
Beaumont v. Parker, 514 S.W.3d 214, 224–25 (Tex. 2017); Nguyen, 605 S.W.3d at
792 n.19. Due to our disposition below, we need not address the propriety of
alleging such a claim nor the parties’ arguments on appeal as to whether or not such
a cause of action exists under Texas law. See TEX. R. APP. P. 47.1; Nguyen, 605
S.W.3d at 792 n.19.
53
v. SunGard Consulting Servs., LLC, 437 S.W.3d 917, 920 (Tex. App.—Dallas 2014,
pet. denied) (quoting Tilton v. Marshall, 925 S.W.2d 672, 681 (Tex. 1996)); see also
Agar Corp. v. Electro Circuits Int’l, LLC, 580 S.W.3d 136, 138, 140–45, 148 (Tex.
2019) (recognizing conspiracy as theory of derivative liability, not independent tort);
Spencer & Assocs., P.C. v. Harper, 612 S.W.3d 338, 354 (Tex. App.—Houston [1st
Dist.] 2019, no pet.). Because there “can be no independent liability for civil
conspiracy,” a plaintiff does not have a viable conspiracy claim if the trial court
correctly grants summary judgment on the underlying tort. Spencer & Assocs., 612
S.W.3d at 354 (internal quotations omitted); see also Nguyen, 605 S.W.3d at 792–
93. And because it is a derivative claim, civil conspiracy takes the statute of
limitations period of the underlying tort that is the object of the conspiracy. Agar
Corp., 580 S.W.3d at 138, 142, 144, 148; see also Nguyen, 605 S.W.3d at 793.
Aiding and abetting, like civil conspiracy, is also a derivative tort—to the
extent it is an actionable tort in Texas—and the trial court’s proper grant of summary
judgment on the underlying tort serves to grant summary judgment on the plaintiff’s
aiding and abetting claim as well. See W. Fork Advisors, 437 S.W.3d at 921; see
also Nguyen, 605 S.W.3d at 792–93.
Appellants acknowledge in their briefing that their claims for civil conspiracy
and aiding and abetting are derivative of their civil barratry claims, and they only
assert that the trial court erred in granting appellees summary judgment on their civil
54
conspiracy and aiding and abetting claims because the trial court first erred in
granting appellees summary judgment on appellants’ civil barratry claims. Because
we have held that the trial court properly granted appellees summary judgment on
appellants’ civil barratry claims, we hold that the trial court did not err in granting
appellees summary judgment on appellants’ derivative civil conspiracy and aiding
and abetting claims. See Nguyen, 605 S.W.3d at 793.
We overrule appellants’ second issue.
Breach of Fiduciary Duty
In their third issue, appellants argue that the trial court erred in granting
appellees summary judgment on their breach of fiduciary duty claims because a
four-year statute of limitations applies to their breach of fiduciary duty claims, their
breach of fiduciary duty claims did not fully accrue until June 26, 2018 when the
trial court dismissed appellants’ civil barratry claims, appellees failed to negate
applying the discovery rule, and the trial court erred in not applying the Hughes and
McClung tolling doctrines to appellants’ breach of fiduciary duty claims. In their
fourth issue, appellants argue that the trial court erred in granting appellees summary
judgment on their breach of fiduciary duty claims because such claims do not require
actual damages to obtain the equitable remedy of fee forfeiture and appellees failed
to negate the availability of statutory civil penalties.
55
Here, the trial court granted appellees summary judgment on appellants’
breach of fiduciary duty claims without specifying the grounds. See Beverick, 186
S.W.3d at 148 (if trial court grants summary judgment without specifying grounds,
we must uphold judgment if any of asserted grounds are meritorious). Thus,
appellants must show that none of the proposed summary-judgment grounds support
the trial court’s ruling. Rogers v. Ricane Enters., Inc., 772 S.W.2d 76, 79 (Tex.
1989); see also Joe v. Two Thirty Nine Joint Venture, 145 S.W.3d 150, 157 (Tex.
2004) (appellate court will affirm summary-judgment ruling if any of theories
presented to trial court and preserved for appellate review are meritorious).
In their motion for partial summary judgment on appellants’ breach of
fiduciary duty claims, appellees asserted that appellants had essentially recast their
time-barred civil barratry claims as breach of fiduciary claims “to prevent all of the
barratry-related claims from being dismissed at [one time].”29 Appellees reiterated
this argument at the hearing on their partial-summary-judgment motion.
29
To the extent that appellants assert in their briefing that appellees did not raise this
ground in their partial-summary-judgment motion on appellants’ breach of fiduciary
duty claims, we disagree. See TEX. R. CIV. P. 166a(c); Travis v. City of Mesquite,
830 S.W.2d 94, 99–100 (Tex. 1992) (“In an appeal from a summary judgment,
issues to be reviewed by the appellate court must have been actually presented to
and considered by the trial court.”); see also Crimson Expl., Inc. v. Intermarket
Mgmt., LLC, 341 S.W.3d 432, 440 (Tex. App.—Houston [1st Dist.] 2010, no pet.)
(“An appellate court should consider all the grounds for summary judgment . . . that
were preserved by the movant . . . .”). Appellants acknowledge in their opening
brief that appellees “moved for summary judgment on [a]ppellants’ breach of
56
At the time that appellees filed their initial motion for partial summary
judgment on appellants’ civil barratry, civil conspiracy, and aiding and abetting
claims, appellants’ live pleading was their first amended petition. In their first
amended petition, appellants only brought claims against appellees for civil barratry,
civil conspiracy, and aiding and abetting.30 They did not allege any breach of
fiduciary duty claims against appellees. After appellees filed their initial
partial-summary-judgment motion,31 asserting that appellants’ civil barratry, civil
conspiracy, and aiding and abetting claims were time barred, appellants amended
their petition, alleging, for the first time, claims for breach of fiduciary duty.
Subsequently, the trial court granted appellees summary judgment on appellants’
civil barratry, civil conspiracy, and aiding and abetting claims “based on . . . [the]
statute of limitations” and dismissed those claims. Appellees then moved for partial
summary judgment on appellants’ newly alleged breach of fiduciary duty claims.
Texas courts have held that a plaintiff may not recast her claim in the language
of another cause of action to avoid limitations or compliance with mandatory statutes
or to circumvent existing case law contrary to the plaintiff’s position. See Earle v.
fiduciary duty claims, alleging they ‘[were] just a recast of the time-barred barratry
claims.’”
30
Appellants also alleged alternative negligence claims against appellees, which they
later non-suited. See supra.
31
This motion was for partial summary judgment because appellants’ alternative
negligence claims were still pending.
57
Ratliff, 998 S.W.2d 882, 893 (Tex. 1999); Walker v. Con Cap Equities, Inc., No.
08-00-00244-CV, 2002 WL 971797, at *5 (Tex. App.—El Paso May 9, 2002, no
pet.) (not designated for publication); Crowder v. Am. Airlines, Inc., No.
05-99-00661-CV, 2000 WL 471520, at *2 (Tex. App.—Dallas Apr. 25, 2000, pet.
denied) (not designated for publication); Wright v. Fowler, 991 S.W.2d 343, 352
(Tex. App.—Fort Worth 1999, no pet.) (plaintiff cannot recast health care liability
claim in language of another cause of action to avoid statute of limitations); In re
Kimball Hill Homes Tex., Inc., 969 S.W.2d 522, 526 (Tex. App.—Houston [14th
Dist.] 1998, orig. proceeding) (underlying nature of claim controls and plaintiff
cannot, by artful pleading, recast claim to avoid adverse effect of statute).
Here, it is apparent from a review of appellants’ petitions that appellants have
indeed attempted to reframe their time-barred civil barratry claims as breach of
fiduciary duty claims. As to their civil barratry claims, appellants alleged that
appellees engaged in improper solicitation of potential clients by violating several
provisions of Texas Penal Code section 38.12, which prohibits barratry, 32 and rule
7.03 of the Texas Disciplinary Rules of Professional Conduct33 concerning barratry,
and appellees’ procured contracts for legal services or employment as a result.34
32
See TEX. PENAL CODE ANN. § 38.12(a)(4), (b).
33
See TEX. DISCIPLINARY R. PROF’L CONDUCT 7.03(a)–(d).
34
See Act of May 5, 2011, 82d Leg., R.S., ch. 94, § 2, sec. 82.0651(a), 2011 Tex. Gen.
Laws 534, 535 (amended 2013).
58
Appellants’ breach of fiduciary duty claims are similarly based on appellees’ alleged
improper solicitation. In fact, their breach of fiduciary duty claims focus entirely on
appellees’ alleged failure to disclose that they had secured a contract for legal
services based on improper solicitation. See Crowder, 2000 WL 471520, at *2
(focusing on “[t]he gist” of plaintiff’s complaint). Appellants cannot avoid the fact
that their civil barratry claims are barred by the statute of limitations by trying to
convert them to breach of fiduciary duty claims. See In re Kimball Hill Homes Tex.,
Inc., 969 S.W.2d at 526; see also Rodriguez v. Safeco Ins. Co. of Ind., No.
SA-18-CV-00851-OLG, 2019 WL 650437, at *4–5 (W.D. Tex. Jan. 7, 2019) (order)
(plaintiff could not attempt to reframe time barred claims to avoid applicable statute
of limitations; noting plaintiff’s fraud claim stemmed directly from allegations of
breach of contract); Martz, 965 S.W.2d at 588–89 (essence of claim controls, not
what pleader might choose to call it); Herter v. Wolfe, 961 S.W.2d 1, 5 (Tex. App.—
Houston [1st Dist.] 1995, writ denied).
In sum, appellants have attempted to reframe their civil barratry claims as
breach of fiduciary duty claims. Yet we have determined that appellees conclusively
proved that appellants’ civil barratry claims brought under the original version of
Texas Government Code section 82.0651(a) are time barred. Because we held that
the trial court did not err granting appellees summary judgment on appellants’ civil
barratry claims based on the statute of limitations, we also hold that the trial court
59
did not err in granting appellees summary judgment on appellants’ breach of
fiduciary duty claims. See, e.g., Walker, 2002 WL 971797, at *5.
We overrule appellants’ third and fourth issues.35
Conclusion
We affirm the judgment of the trial court.
Julie Countiss
Justice
Panel consists of Justices Hightower, Countiss, and Farris.
35
Due to our holding, we need not address appellants’ remaining arguments related to
their assertion that the trial court erred in granting appellees summary judgment on
appellants’ breach of fiduciary duty claims. See TEX. R. APP. P. 47.1.
60