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Austin Business Organizations Law Blog

Taylor Dunham and Rodriguez Wins Legal Malpractice Case in Texas Supreme Court

Taylor Dunham and Rodriguez LLP successfully reversed a Court of Appeals judgement in Linegar v. DLA Piper US, LLP. Donald Taylor, Jennifer Tatum Lee, and Natalie Taylor of Taylor Dunham Rodriguez LLP tried the case that returned the largest legal malpractice verdict in the State for 2013.

Your Rights in a PBM Termination Appeal

We have been seeing a spike in pharmacy benefit management (PBM) network terminations. Termination from a PBM's pharmacy network can be catastrophic to a pharmacy's business. Many PBM terminations are not "for cause." The PBM simply decides to eliminate the pharmacy from its network. Other terminations are initiated after the PBM audits the pharmacy and finds one or two record keeping errors (i.e., where no fraudulent conduct was found). We have been seeing many small discrepancies found in wholesale invoice audits as well that have led to PMB terminations.

Breach of Contract Attorneys Proving Up Attorney's Fees

In other posts on this blog I have written about the ability of a party to recover its attorney's fees under Tex. Bus. Com. Code § 38.001 et seq. as well as through other statutory means. In Texas, the general rule is that the party seeking to recover attorney's fees carries the burden of proof. Stewart Title Guar. Co. v. Sterling, 822 S.W.2d 1, 10 (Tex. 1991). How do you prove up an attorney's fee claim? Generally either an expert affidavit or testimony will be offered proving up the attorney's fees. Included in this testimony are the factors that must be considered for an attorney fee award to be both necessary and reasonable. An expert witness will examine the hours worked, the amount charged, the type of case and other factors in offering their opinion about the reasonableness of the fee. Can a party recover attorney's fees even if it has agreed to pay its attorneys a contingency fee interest? Yes, but a party cannot simply ask a jury to award a percentage of the recovery. Ving Card A.S. v. Merrimac Hospitality Sys., Inc., 59 S.W.3d 847 (Tex. App.--Fort Worth 2001, review denied). Instead, expert testimony is offered proving up a specific amount. Proving up attorney's fee claims are a regular part of a breach of contract attorney's practice.

Contracts: Enforcing Your Rights and Recognizing the Enforceability of Certain Clauses

The freedom to contract is a principal that is recognized under Texas law.  However, there are some limitations on a party's ability to contractually limit certain rights.  All legal disputes must be filtered through the rules of evidence.  Can parties to a contract change the rules of evidence that will apply in the event a dispute arises between the contracting parties?  The answer is most likely "no." Texas, like other states, has a code of evidence which provides rules and limitations on what types of evidence are admissible.  For example, the Texas Rules of Evidence have certain provisions relating to the admission of documents.  Could a contract limit the rights of one party to introduce into evidence certain types of documents in contravention of the Texas Rules of Evidence?  There is Texas case law that provides that "contract language abrogating fundamental rules of evidence is unreasonable, if not void, and will not be enforced."  Shultz v. American Nat. Ins. Co., 142 S.W.2d 275, 279 (Tex. Civ. App.--Beaumont 1940, writ dismissed).  While a contract may contain certain restrictions and limitations on a parties' rights, Texas law might provide that such contractual language is void. What if a contract is silent about a right?  For example, say a contract that is performable and enforceable in Texas does not address the recovery of attorney's fees?  Texas law, under Tex. Bus. & Com. Code § 38.0001 et. seq., provides that a prevailing party can recover its attorney's fees for breach of contract.  This is a statutory right that a prevailing party has on a breach of contract claim even if the contract sought to be enforced does not have a provision about the recovery of attorney's fees.

Article Regarding a Taylor Dunham Jury Verdict Is One of the Top Ten Stories of the Year

Legal malpractice cases are often followed with great interest by other lawyers. As has been detailed in other blog posts, Donald Taylor, Jennifer Tatum Lee, and others recently obtained a jury verdict of $1.29 million against DLA Piper in a legal negligence case that was tried in February of this year. The legal malpractice case trial took place in Travis County District Court and lasted over two weeks. One of the publications that picked up the story was the Texas Lawyer, a weekly legal publication. Recently, the Texas Lawyer provided a list of the top 20 Texas Lawyer articles and videos for the first half of 2012; the story about our $1.29 million legal malpractice verdict came in at number 10. The ratings were based upon the number of page views received on wwww.texaslawyer.com.

The Requirement of "Reasonable Diligence" and "Knowing the Customer" in Securities Arbitrations.

NYSE Rule 405(1) requires investment firms to use reasonable diligence in regard to the opening and maintenance of every investment account and to know the essential facts concerning every customer. These requirements are also embodied in the new FINRA Rule 2090 (Know Your Customer). These duties of reasonable diligence and knowing the customer do not apply only to situations where the stockbroker or investment advisor has made a recommendation. Rather, they apply to all aspects of the customer relationship, from the opening of the account on. If you have suffered losses on your investments due to the actions or omissions of your stockbroker or investment advisor, you should discuss with your securities arbitration attorney how these internal, regulatory rules of FINRA may apply to your case. These rules can become powerful authorities in a securities arbitration as the panel considers what the standard of care is and whether such a standard has been satisfied in a particular case.

Securities Arbitration Attorneys may Invoke Industry Rules and Regulations to Help Prove their Case

We recently filed a FINRA arbitration on behalf of a professional athlete. His story is a tragic one. He and his wife were swindled out of the majority of their assets when they placed their money in the hands of financial advisors who, in turn, invested the assets in a Ponzi scheme. We brought claims for breach of contract, negligence, common law and statutory fraud, breach of fiduciary duty and violations of the Texas Securities Act. In our FINRA arbitration filing, we cited many industry rules and regulations which support our case. In this and in succeeding blog posts, I will discuss some of these industry rules and regulations. FINRA Rules 2010 and 2020 require that all FINRA members "observe high standards of commercial honor and just and equitable principles of trade" and prohibit such members from "effect[ing] any transaction in . . . any security by means of a manipulative, deceptive or other fraudulent device or contrivance." We will ask the securities arbitration panel to hold all parties who had a duty to properly manage and oversee our clients' accounts responsible for failing to observe such "high standards of commercial honor." If an investor is put into a security by means of manipulation, deception, distortion or misrepresentation/omission of material fact, then these cited FINRA rules have been violated. It is only reasonable that the members of FINRA be required to comply with their own rules and regulations. If you are an investor that has suffered financial losses, you are encouraged to consult with a securities arbitration lawyer regarding how FINRA Rules 2010 and 2020, among others, may apply to your specific case.

The Recovery of Disfigurement Damages in Personal Injury Lawsuits

Disfigurement is an element of personal injury damages that a jury is asked to separately value when a case goes to trial. In a typical jury charge, there is a separate blank for a jury to fill out on the issue of disfigurement. Evidence introduced to prove disfigurement can be powerful at trial. The scarring or deformity involved with disfigurement can be compared with prior photographs showing the pre-injury condition of the injured person. The before and after version of the person the jury is looking at with their own eyes can often really hit home and motivate the jury to compensate the injured party significantly. Disfigurement as an element of personal injury damage has been defined as, essentially, anything that impairs the beauty, symmetry or appearance of a person. Disfigurement damages are typically recovered in cases involving scarring, deformity, amputation or any other changes in appearance of a person. The plaintiff may recover for not only past disfigurement, but also for future disfigurement that in all reasonable probability will be suffered. Injured parties should work closely with their lawyers to fully develop any and all avenues of recovery in the unfortunate event that disfigurement has been suffered.

The Hangover: Satchels, Louis Vuitton, and Trademark Infringement

What do trademark infringement attorneys dream of when they take a little tiger snooze?  Sometimes it is an interesting trademark infringement case that deals with a wildly popular movie, a famous fashion company and some fundamentals in trademark law.  Just such a case recently issued an opinion that has many good instructional points in trademark infringement law.  See Louis Vuitton Mallatier S.A. v. Warner Brothers Entertainment Inc., Cause No. 11 Civ. 9436 in the United States District Court for the Southern District of New York ("Hangover II ").  This trademark infringement case involved the use of Louis Vuitton's trademarks in the movie "The Hangover: Part II." For those familiar with the Hangover movies and characters, you will know that the character Alan deflects criticism in the first movie of his man purse by calling it a "satchel" and grouping himself in the esteemed company of Indiana Jones.  In the Hangover II, the gags continue with Alan and the "wolf pack" riffing on a fake Louis Vuitton Keepall travel bag.  The court trademark infringement opinion is both entertaining and instructive.  The opinion even references lines in the movie.  Alan states that, with respect to a counterfeit Louis Vuitton Keepall travel bag, to be "careful that is  . . . that is a Lewis Vuitton."   Louis Vuitton did not see the humor in the line or the use of the fake bag and filed a lawsuit against Warner Bros. asserting three claims for relief (1) false designation of origin/unfair competition in violation of Section 43(a) of the Lanham Act (i.e. trademark infringement); (2) common law unfair competition; and (3) trademark dilution in violation of N.Y. Gen. Bus. Law 360-l.    On June 15, 2012 the Court sided with Warner Bros. and dismissed the lawsuit for failure to state a claim upon which relief can be granted.  Louis Vuitton complained that Warner Bros. misrepresented that the knock off bag was a genuine Louis Vuitton product. More specifically, Louis Vuitton argued that Warner Bros. impressmissably used a third-party's bag that allegedly infringed on the Louis Vuitton trademarks.  In reviewing Louis Vuitton's Lanham Act claims the court noted that the Lanham Act is inapplicable to "artistic works" as long as the defendant's use of the mark is (1) "artistically relevant" to the work and (2) not "explicating misleading" as to the source or content of the work.  Rogers v. Grimaldi, 875 F.2d 994, 999(2d Cir. 1989).  In examining the artistic relevance issue, the court noted that the remark came "across as funny because [the character] mispronounces the French "Louis" like the English "Lewis.""  The court concluded that the use of the knock-off bag had some artistic relevance to the plot of the Hangover: Part II.  The court also concluded that the allegations of confusion were not plausible and that there was no likelihood of confusion that viewers would believe that the fake bag was a real Louis Vuitton bag just because a fictional character made this claim in the context of a fictional movie.    While humor rarely translates to written legal opinions, it cannot be said that the United States District Court for the Southern District of New York does not recognize a humorous scene in a movie when it is asked to review it in a trademark infringement claim.  This opinion, while entertaining, also highlights the current state of the law on the applicability of trademark infringement to "artistic works."

Damages for Physical Impairment Caused by Personal Injury is a Recoverable Element of Damages

Physical impairment is defined generally as a substantial change to the injured party’s former lifestyle that goes beyond loss of earning capacity or mere pain and suffering. It includes the loss of the ability to participate in activities such as walking, climbing, running, dancing and other recreational and social activities. For example, the cyclist who can no longer enjoy the frequent rides that were so meaningful in his or her life may well have a powerful claim for physical impairment damages. Juries will be asked to separately value physical impairment damages from all other recognized elements of personal injury damages. You are encouraged to work closely with your personal injury attorney in presenting all facts to the activities you can no longer do as a result of your injury.
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