El Apple I, Ltd. v. Olivas, 370 S.W.3d 757 (Tex. 2012)

Attorney Fees- Proper Lodestar Calculation– This was a suit for employment discrimination and retaliation under the Texas Commission on Human Rights Act.  After a trial, the employee prevailed only on the retaliation claim.  After the trial, the employee’s attorney submitted an application for attorney’s fees accompanied by affidavits.  The affidavits set forth the work done by the attorneys generally and the approximate number of hours of each attorney.  The trial court used the “lodestar” method in determining a reasonable fee.  The lodestar method involves two steps.  First, the court must determine the reasonable hours spent by counsel and a reasonable hourly rate.  The court then multiplies the number of such hours by the rate, the product of which is the base fee or lodestar.  The court may then adjust the base lodestar up or down (apply a multiplier), if relevant factors indicate an adjustment is necessary to reach a reasonable fee.  The Supreme Court stated that a party applying for attorney fees under the lodestar method bears the burden of documenting the hours expended on the litigation and the value of those hours.  In this case, the Court stated that the issue was whether the trial court properly applied the lodestar method in determining the fees.  The Supreme Court stated that the evidence presented supporting the fee should include (1) the nature of the work, (2) who performed the services and their rate, (3) approximately when the services were performed, and (4) the number of hours worked.  The Court further stated that when there is an expectation of use of the lodestar method, attorneys should document their time much as they would for their own clients, that is, contemporaneous billing records or other documentation recorded reasonably close to the time when the work is performed.  In this case, the Court noted that the attorneys did not present time records or other documentary evidence; nor did they testify based on their recollection of such records.  The attorneys instead based their time estimates on generalities such as the amount of discovery in the case, the number of pleadings filed, the number of witnesses questioned, and the length of the trial.  The Court stated that this information may be relevant but it provides none of the specificity need for the trial court to make a meaningful lodestar determination.  Also, the Court stated that if multiple attorneys or other legal professionals are involved, the fee application should indicate which attorney performed a particular task or category of tasks.  The Court further held that when obtaining payment for legal assistants more information is needed such as: (1) the qualifications of the legal assistants to perform substantive legal work, (2) that the legal assistant performed substantive legal work under the direction and supervision of an attorney, (3) the nature of the legal work performed, (4) the legal assistant’s hourly rate, and (5) the number of hours expended by the legal assistant.  The legal fee award was reversed and sent back to the trial court so that the attorneys could “reconstruct their work in the case to provide the minimum information the trial court requires to perform a meaningful review of their fee application.”  The Court then examined the trial court’s doubling the lodestar to approximate a reasonable fee in the case.  The Court held that a trial court could apply a multiplier to increase or decrease the lodestar figure to approximate a reasonable fee.  The Court noted that in their class action rulings they had authorized multiplier to fee awards “in the range of 25% to 400% of the lodestar figure” and that amount could be used in TCHRA actions.

In Re XL Specialty Insurance Company, 373 S.W.3d 46 (Tex. 2012)

Worker’s Comp- Evidence- Privileges– In a suit by worker against worker’s comp carrier for employer, employee sought the communications made between employer and the carrier during the administrative proceedings.  The carrier and employer refused raising the attorney-client privilege (Tex.R.Evid 503(b), the joint client privilege, the joint defense and common interest doctrine, and the allied litigant doctrine.  The trial court ruled against the privilege and the insurer brought a writ of mandamus proceeding.  The Supreme Court discusses the foregoing privileges and doctrines but holds that they do not apply in this case regarding communications between a worker’s comp insurer and its insured (the case is a good resource for case authorities related to the foregoing privileges).  If the employer had been a defendant and the communications had been between the lawyers for the two defendants then the communications probably would have been privileged.

Garza v. Zachry Construction Corp., 373 S.W.3d 715 (Tex.App.-San Antonio 2012, pet. denied)

Worker’s Comp-Employer Immunity– Worker (employee of plant owner), who had been injured in railcar accident at a chemical plant, brought suit against a subcontractor and subcontractor’s employees working at the plant alleging that the negligence of the subcontractor’s employees caused the accident.   The worker had received worker’s compensation benefits provided by his employer.  The Court noted that in this suit the situation was not a subcontractor’s employee suing a general contractor or the employee of another subcontractor and that under those circumstances Tex.Lab.Code § 408.001 would bar the subcontractor’s employee’s claims and limit the recovery to worker’s compensation benefits.  Instead, in this case, the premises owner/general contractor’s employee was suing the subcontractor and two of the subcontractor’s employees.  In the motion for summary judgment, which was granted by the trial court, the defendants argued that under TLC § 406.123, the premises owner/general contractor was their deemed employer and all of the participants were then all deemed fellow employees when the general contractor provides worker’s compensation insurance coverage to its employees and the subcontractor’s employees.  The Court pointed out that courts have extended the reach of §§ 408.001 and 406.123 to premises owners (thus, according to the Court, the Legislature and courts have created a legal fiction of premises owners/general contractors as “deemed employers”, subcontractors as “deemed employees” of the premises owner/general contractor and all tiers of subcontractors as “fellow employees” for purposes of the worker’s comp act).  The plaintiff employee argued that the statute was unconstitutional based on the Texas “open courts” provision by preventing his common law negligence suit against the subcontractor.  As generally happens in an open courts challenge, the Court spent a couple of pages of twisting like a pretzel to finally rule that the open courts provision did not save the plaintiff from being flushed down the tube from which no claim returns.

University of Texas Medical Branch at Galveston v. Petteway, 373 S.W.3d 785 (Tex.App.-Houston 2012, no pet.)

Gender Discrimination- A female nurse brought a gender discrimination claim under the Texas Commission on Human Rights Act (TCHRA) against the hospital employer alleging that the termination of her employment was disparate discipline for her conduct after revelation of her affair with a male nurse.  The district court denied the hospital’s plea to the jurisdiction.  The hospital appealed and the court of appeals reversed and dismissed the female nurse’s claim.  The Court of Appeals stated that in order for the female nurse to establish a prima facie case of gender discrimination she must establish (1) that she was a member of a class protected by the TCHRA; (2) she was qualified for her position; (3) she was terminated; and (4) she was treated less favorably than similarly situated members of the opposing class.  The Court further stated that employees who are treated differently are similarly situated under the TCHRA if the circumstances are comparable in all material respects, including similar standards, supervisors, and conduct.  To prove the claim based on disparate discipline, it must be shown that the misconduct of the employees must be of comparable seriousness.  Usually, the employee must show that the misconduct for which the employee was discharged was nearly identical to that engaged in by the non-disciplined employee and the comparator must have essentially comparable disciplinary violation histories.

Nazareth Hall Nursing Center v. Melendez, 372 S.W.3d 301 (Tex.App.– El Paso 2012, no pet.)

Arbitration– “Like trying to invade Russia in the winter” is an old saying for something that is very difficult or impossible.  This saying applies to the difficult battle of overcoming an arbitration agreement in an employment case (considering the love of the Texas Supreme Court for arbitration).  However, this difficulty did not deter Melendez, as she filed a discrimination suit against her employer, who then promptly waived their arbitration agreement in her face.  The district court refused to enforce the arbitration agreement and the employer appealed.  The Court of Appeals agreed with the district court, that since the agreement was contained in the employee handbook and the employer had the right to change any of the policies and procedures of the handbook, the agreement was illusory and unenforceable.  The Court stated that there was a 2006 agreement in the handbook, which Melendez acknowledged when she began employment by signing a form.  However, the Court ruled that this 2006 agreement was illusory because of the employer’s right to change it by the language in the handbook. The employer then argued that a 2009 amended agreement bound Melendez because she continued to work after its adoption and therefore she was bound by it.  However, the Court refused this argument because the employer did not prove that Melendez was ever notified of the 2009 modified agreement or that she accepted the agreement.  Since the employer did not prove the existence of a valid arbitration agreement, the arbitration agreement was invalid as to Melendez.

Hertz Equipment Rental Corporation v. Barousse, 365 S.W.3d 46 (Tex.App.– Houston 2012, pet. denied)

Worker’s Compensation Retaliation– A terminated employee filed suit against his former employer alleging retaliation for his filing of a worker’s compensation claim.  After a bench trial, the district court entered a judgment for damages and exemplary damages.  The employer appealed.  The Court of Appeals reviewed the case and upheld the finding of worker’s compensation retaliation and the actual damages but reversed as to the punitive damages because the evidence did not rise to the level of malice required.  The case contains a thorough examination of the law and damages in this kind of case and should be examined by anyone handling one of these cases.

Pruitt v. International Association of Fire Fighters, 366 S.W.3d 740 (Tex.App.– Texarkana, 2011, no pet.)

Employment Discrimination- Aiding & Abetting– A former fire chief brought an action against a labor union and the union officers alleging aiding & abetting discrimination, and the common law torts of intentional infliction of emotional distress (IIED), breach of fiduciary duty, and tortious interference with employment relations.  The district court dismissed the employee’s claims for lack of jurisdiction.  The employee appealed and the Court of Appeals affirmed.  The claim was brought under Texas Labor Code § 21.056, which states, “An employer, labor union or employment agency commits an unlawful employment practice if the employer, labor union, or employment agency aids, abets, incites, or coerces a person to engage in a discriminatory practice.”  The Court held that the employee was required to present his claim to the Texas Workforce Commission-Civil Rights Division to be processed through their system before he could file suit.  The failure to do this within the time allowed sunk his ship.  The need to go through the TWCCRD has always been required but the application of it to a labor union was the unusual aspect of the case.  However, the Court then cut down his other common law causes of action by holding that Chapter 21 of the Labor Code was the exclusive remedy for the facts presented and could not be avoided by casting the same facts as common law causes of action. [Common law claim for IIED not available to employee complaining of sexual harassment in employment because gravamen of complaint was sexual harassment. Hoffman– La Roche, Inc. v. Zeltwanger, 144 S.W.3d 441 (Tex.2004)].  The employee tried to abandon and expressly exclude the claim for discrimination; however, the Court pointed out that his claims for racial discrimination would be a factor in the case and that they were inextricably intertwined with the facts giving rise to complaints that could have been resolved through Chapter 21’s administrative procedure.  And, this seems to be the key question of whether Chapter 21 precludes a common law cause of action.  Are the facts intertwined and could the facts have been reasonably submitted to the TWCCRD or the EEOC?  If so, then the claim must be brought through the TWCCRD and cannot be reformatted as a common law claim to avoid the TWCCRD.