Justia Texas Supreme Court Opinion Summaries

A minority shareholder (Plaintiff) filed suit against a closely held corporation and the corporation’s board of directors, alleging that the directors engaged in oppressive conduct and breached their fiduciary duties by refusing to buy Plaintiff’s shares for fair value or meet with prospective buyers. The jury found in Plaintiff’s favor on essentially all of her claims. The trial court rendered judgment on the jury’s verdict and ordered the corporation to purchase Plaintiff’s shares for $7.3 million. The court of appeals upheld the buy-out order, concluding that the directors’ refusal to meet with Plaintiff’s prospective purchasers constituted oppressive conduct as a matter of law. The Supreme Court reversed, holding (1) the directors’ conduct was not “oppressive” under the relevant statute; (2) the statute does not authorize courts to order a corporation to buy out a minority shareholder’s interests; and (3) there is no common-law cause of action for “minority shareholder oppression.” Remanded for consideration of Plaintiff’s breach of fiduciary duty claim. View "Ritchie v. Rupe" on Justia Law

A corporation invited guests to a business retreat at the corporation’s expense at a lodge near the Gulf of Mexico. The lodge provided the guests with bay fishing from small boats. The corporation provided alcoholic beverages on the boats at the guests’ request. After one guest spent some time on the boat, returned to the lodge, and left to drive home, the guest struck a motorcycle ridden by the plaintiffs, who were severely injured. The plaintiffs sued the corporation, alleging that it negligently allowed the guest to drink excessively. Because Texas law does not recognize such social host liability, the plaintiffs asserted that federal maritime law applied in this case because, before the accident, the guest became intoxicated while on the fishing boat. The court of appeals concluded that maritime law applied. The Supreme Court reversed, holding that, under the tests set forth by the U.S. Supreme Court in Jerome B. Grubart, Inc. v. Great Lakes Dredge & Dock Co., the action did not fall within admiralty jurisdiction. View "Schlumberger Tech. Corp. v. Arthey" on Justia Law

An owner contracted with an Architect to prepare plans and specifications for the construction of a light rail. A General Contractor was awarded the contract to construct the project. The Architect and General Contractor had no contract with each other. Because the Architect’s plans were full of errors, the General Contractor lost nearly $14 million on the project. The General Contractor filed a tort suit against the Architect, alleging negligent misrepresentation. The trial court rendered judgment for the General Contractor for $2.25 million plus interest. The Architect appealed, arguing that the economic loss rule barred the General Contractor’s claim. The Supreme Court reversed, holding that the economic loss rule applied in this case to preclude the General Contractor from recovering delay damages from the Architect. View "LAN/STV v. Martin K. Eby Constr. Co., Inc." on Justia Law

Plaintiff, a patron of the Graham Central Station nightclub, was assaulted by other patrons of the club. Plaintiff sued Graham Central Station, Inc. (GCS), the nightclub’s purported owner, alleging that GCS failed to provide adequate security to protect Plaintiff. The trial court rendered judgment for Plaintiff and awarded him $450,000 for pain and suffering and mental anguish. GCS appealed, arguing that Plaintiff sued the wrong party and that the evidence was insufficient to support the damages award. The court of appeals reduced Plaintiff’s damages to $249,000 and otherwise affirmed. The Supreme Court reversed the court of appeals’ judgment and rendered judgment in GCS’s favor, holding that the evidence supporting a finding that GCS owned the nightclub was legally insufficient, and therefore, there was insufficient evidence that GCS owed a duty to Plaintiff. View "Graham Cent. Station, Inc. v. Pena" on Justia Law

A mineral lessee operated two wells on two contiguous tracts of land. When one of the wells stopped producing, the lessee pooled parts of the two mineral leases. Landowners subsequently bought a tract of land that included the road the lessee used to access the producing well. The road was across the surface of the lease without production. After traffic on the road increased, the landowners filed suit against the lessee, claiming that the lessee had no legal right to use the surface of their tract of land to produce minerals from the operating well. The trial court determined that the lessee did not have the right to use the road to access the producing lease and granted declaratory and injunctive relief. The Supreme Court reversed, holding (1) once pooling occurred, the pooled parts of the two contiguous tracts no longer maintained separate identities insofar as where production from the pooled interests was located; and (2) therefore, the lessee had the right to use the road to access the pooled part of the tract of land containing the producing well. View "Key Operating & Equip., Inc. v. Hegar" on Justia Law

Plaintiffs sued Ford Motor Company for injuries they sustained in a roll-over accident. The case was submitted to a jury. After the jury began its deliberations, the parties agreed to settle the case. Ford, however, later refused to pay the settlement amount to Plaintiffs, and Plaintiffs sued for breach of contract. After hearing all of the evidence, the jury found the settlement agreement was invalid because of fraudulent inducement and mutual mistake. The court of appeals reversed the trial court’s take-nothing judgment, concluding that the circumstantial evidence of fraud in the case was legally insufficient. The Supreme Court reversed the court of appeals’ judgment and reinstated the judgment of the trial court, holding that the circumstantial evidence was legally sufficient to support the jury’s verdict. View "Ford Motor Co. v. Castillo" on Justia Law

Respondents sold a collection of insurance companies to Petitioners in an agreement that contained an arbitration clause. Petitioners later invoked arbitration, alleging breach of contract. After Respondents complained about Petitioners’ first and second choice arbitrators the American Arbitration Association (AAA) struck the arbitrators. Petitioners’ third appointee was not challenged, and the arbitration proceeding resulted in an award in Respondents’ favor. When Respondents filed a motion to confirm the award in the trial court, Petitioners renewed their previous objection to the disqualification of their first-choice arbitrator. Ultimately, the court of appeals held that the arbitration panel was properly appointed under the terms of the arbitration agreement and the AAA rules. The Supreme Court reversed, holding (1) because the AAA disqualified Petitioners’ first-choice arbitrator for partiality, the arbitration panel was formed contrary to the express terms of the arbitration agreement; (2) therefore, the arbitration panel exceeded its authority when it resolved the parties’ dispute; and (3) accordingly, the arbitration award must be vacated. View "Americo Life, Inc. v. Myer" on Justia Law

Keystone-Texas Property Holding Corporation owned the Rivercenter Mall and the ground beneath the San Antonio Marriott Riverwalk hotel. Keystone leased the hotel land to Petitioners, who owned and operated the hotel. In 2004, Keystone put the two properties up for sale. After Keystone found a prospective buyer, Petitioners informed Keystone they were interested in buying the land and were not ready to waive their rights under the lease. The deal to sell the properties fell through, and Keystone sued Petitioners for actions Keystone believed scuttled the deal. A jury found for Keystone on all issues and awarded damages for slander of title and tortious interference with a contract. The Supreme Court reversed, holding that there was no evidence Petitioners caused any damages to Keystone. View "HMC Hotel Props. II Ltd. P’ship v. Keystone-Texas Prop. Holding Corp." on Justia Law

Borrower borrowed $696,000 from Lenders. The note was secured by a deed of trust covering real property. Guarantor guaranteed the loan under a guaranty agreement that included a general waiver of defenses. Borrower subsequently defaulted on the loan, and Purchaser purchased the secured property in a nonjudicial foreclosure sale for $487,200. The fair market value of the property was $840,000. Purchaser sued Guarantor to recover the $266,748 balance remaining on the note after applying all credits and the proceeds from the sale. Guarantor argued that under Tex. Prop. Code Ann. 51.003 any deficiency owed should be offset by the difference between the fair market value and the foreclosure price. The trial court granted summary judgment for Guarantor. The court of appeals reversed, holding (1) section 51.003 creates an affirmative defense, and (2) by agreeing to a general waiver of defenses in the guaranty agreement Guarantor waived his right of offset. The Supreme Court affirmed, holding that Guarantor waived his statutory right to an offset. View "Mehrdad v. Interstate 35/Chisam Road, L.P." on Justia Law

Plaintiffs, two groups of cotton farmers, filed suits against the cooperative of which they were members under contract, alleging that they were fraudulently induced to join the cooperative. Plaintiffs’ agreements with the cooperative provided for the arbitration of all disputes under the Federal Arbitration Act (FAA). The cooperative filed a motion to stay the litigation and a motion to compel arbitration. The trial court denied the motions, concluding that the parties’ arbitration agreement was unconscionable. The court of appeals affirmed, reasoning that the agreements were unconscionable because they forced the farmers to “forego substantive rights and remedies afforded by statute.” The Supreme Court reversed, holding that the limitation of statutory remedies was insufficient to defeat arbitration under the FAA. Remanded. View "Venture Cotton Coop. v. Freeman" on Justia Law