Link of the Day - Texas Supreme Court Favors Big Business

The Dallas Morning News recently ran a lengthy article on a subject I have mentioned many times -- the Texas Supreme Court has a definite bias toward big business and against Texas consumers and injury victims. Please read the full article. Here are some excerpts:

Texas' Supreme Court justices aren't in the habit of defending their judicial records, much less from lawyers grilling them as they would an uncooperative witness.

But that's just what happened in September at a continuing education event at Horseshoe Bay Resort hosted by the Dallas Bar Association, where lawyers peppered two justices with questions about their impartiality.

Sample query: Do the justices hunt for plaintiff victories in appeal courts just so they can overturn them?

"To be honest, I've never seen anything quite like that in a bar group," Justice Paul Green told Texas Lawyer magazine after the event.

The incident has added fire to a decade-long debate over whether Texas' highest court favors big business in lawsuits.

The perception is bolstered by data showing that the court's rulings increasingly favor defendants in lawsuits – upward of 87 percent of the time, one study said.

In one case, they complain, the court seemed to cherry-pick state laws to find a way to give a property owner the same protections from an injured worker's lawsuit that a contractor has compared with an employer. The worker, hired by a contractor, was injured in a plant owned by Entergy Gulf States.

"I'd say that right now Texas is on the forefront of the business-friendly legal environment," said Rogge Dunn at Clouse Dunn Khoshbin LLP in Dallas, who handles some workers' compensation cases. "If you're an insurer here or a large company getting sued, you've got the Supreme Court as your safety net."

Alex Winslow of Texas Watch is tracking the court's rulings for its 2006-07 term, as he has for the last decade.

By his count, civil defendants won favorable rulings in a relatively equitable 52 percent of cases in the court's 2000-01 term, but the number has been soaring since then. In 2005-06, 82 percent of rulings went in favor of defendants, he said.

"This is an anti-consumer court," he said.

He called the Entergy ruling "egregious" because he thinks the court hunted for a way to rule for the company.

The Entergy ruling ignored the Legislature's previous actions on the issue that were pro-worker. A ruling the previous week involving another energy company cited legislative intent, Mr. Winslow said, "making them unbelievably inconsistent, except for the fact that the energy company won both times."

In a separate study, law professor David Anderson of the University of Texas at Austin found 87 percent of lawsuit defendants received favorable rulings in the 2004-05 term.

What's especially galling to critics of the court is what they see as the court's "activism," a complaint more common from conservative politicians against liberal judges on social issues.

Critics have focused on Justice Hecht, who accepted $16,000 in contributions from Houston home developer Bob Perry's political action committee to help defray costs related to a judicial ethics investigation, as The Dallas Morning News reported in April. The contribution was made as the court was about to hear a case related to Perry Homes.

THREE CASES

These Texas Supreme Court rulings in favor of businesses have been some of the most talked about in the legal community recently.

Entergy Gulf States vs. John Summers
Mr. Summers injured himself at Entergy's Sabine Station plant while he worked for a contractor hired by Entergy. Along with his worker's compensation claim, he tried to sue the utility for negligence. The Supreme Court overturned an appellate ruling in his favor, establishing that Entergy – the "premises owner" – also qualified as a "general contractor" and hence was immune from the injury suits.

Harmar Bottling vs. Coca-Cola
Harmar, a Royal Crown Cola distributor based in Paris, Texas, alleged that Coca-Cola tried to drive it out of business by establishing preferential agreements with grocers in nine Texas counties and three Oklahoma counties. A jury awarded Harmar $16 million in damages and attorney fees, but the Supreme Court ruled that the state's antitrust law doesn't apply in other states and that Harmar hadn't proved damages in Texas.

Lamar Homes vs. Mid-Continent Casualty Insurance
Homeowners sued Lamar Homes for cracks in the walls of houses and for foundation problems. Mid-Continent, Lamar's insurer, declined to cover the suit, and Lamar sued, arguing that the work had been undertaken with the intention of doing it correctly, making any defects "accidental" and covered under the policy. Some consumer advocates praised the ruling as helping homeowners in battles with builders, but others predict insurers' higher rates will simply be passed on to homebuyers.