in Re CVR Energy, Inc., CVR Partners, LP, CVR Refining, LP, Gary-Williams Energy Company, LLC

ACCEPTED
01-15-00877-CV
FIRST COURT OF APPEALS
HOUSTON, TEXAS
10/15/2015 10:35:46 AM
CHRISTOPHER PRINE
CLERK
NO. 01-15-00877- CV
_____________________________________________________________
FILED IN
IN THE COURT OF APPEALS 1st COURT OF APPEALS
HOUSTON, TEXAS
FOR THE FIRST DISTRICT OF TEXAS 10/15/2015 10:35:46 AM
HOUSTON, TEXAS CHRISTOPHER A. PRINE
Clerk
_____________________________________________________________
IN RE CVR ENERGY, INC., CVR PARTNERS, LP, CVR REFINING, LP,
GARY-WILLIAMS ENERGY COMPANY, LLC
RELATORS
_____________________________________________________________
Original Proceeding
From the 434th Judicial District Court of Fort Bend County, Texas
Cause No. 2013-DCV-209679
The Honorable James H. Shoemake, Presiding
_____________________________________________________________
PETITION FOR WRIT OF MANDAMUS
_____________________________________________________________
Phillip D. Sharp Lee M. Smithyman
Texas State Bar No. 18118680 Kansas State Bar No. 09391
MARTIN, DISIERE, JEFFERSON & SMITHYMAN & ZAKOURA, CHARTERED
WISDOM, LLP 750 Commerce Plaza II Building
808 Travis, 20th Floor 7400 West 110th Street
Houston, Texas 77002 Overland Park, Kansas 66210-2362
(713) 632-1700 – Telephone (913) 661-9800 – Telephone
(713) 222-0101 – Facsimile (913) 661-9861 – Facsimile
sharp@mdjwlaw.com lee@smizak-law.com
Application for pro hac admission
pending
ORAL ARGUMENT REQUESTED
IDENTITY OF PARTIES AND COUNSEL
Relators/Defendants:
CVR Energy, Inc.; CVR Refining, LP; Gary-Williams Energy Company,
LLC.
In the trial court, the relators/defendants are represented by the following
attorneys:
Phillip D. Sharp
Texas State Bar No. 18118680
MARTIN, DISIERE, JEFFERSON & WISDOM, LLP
808 Travis, 20th Floor
Houston, Texas 77002
(713) 632-1700 – Telephone
(713) 222-0101 – Facsimile
sharp@mdjwlaw.com
Lee M. Smithyman
Kansas State Bar No. 09391
SMITHYMAN & ZAKOURA, CHARTERED
750 Commerce Plaza II Building
7400 West 110th Street
Overland Park, Kansas 66210-2362
(913) 661-9800 – Telephone
(913) 661-9861 – Facsimile
lee@smizak-law.com
In this original proceeding, the relators/defendants are represented by the
following attorneys:
Mr. Sharp
Mr. Smithyman
Application for admission pro hac vice pending.
i
Real Parties In Interest/Plaintiffs:
Leeanna Mann and Kari Smith
In the trial court the real parties in interest/plaintiffs are represented by the
following attorneys:
Mr. Gary M. Riebschlager
Texas State Bar No. 16902200
THE RIEBSCHLAGER LAW FIRM, PC
801 Congress, Suite 250
Houston, Texas 77002
Telephone: (713) 980-5300
Facsimile: (713) 583-5915
gary@riebschlagerlaw.com
Mr. Richard L. Tate
Texas State Bar No. 19664460
TATE, MOERER & KING, LLP
206 South 2nd Street
Richmond, Texas 77469
Telephone: (281) 341-0077
Facsimile: (281) 341-1003
rltate@tate-law.com
Sidney F. Robert
Texas State Bar No. 24074968
BRENT COON & ASSOCIATES
300 Fannin, Suite 200
Houston, Texas 77002
Facsimile: (713) 225-1785
sidney.robert@bcoonlaw.com
David M. Medina
Texas State Bar No. 00000088
THE MEDINA LAW FIRM
5800 Memorial Drive, Suite 890
Houston, Texas 77007
Facsimile: (713) 583-5915
davidmedina@justicemedina.com
ii
Respondent:
The Honorable James H. Shoemake
434th JUDICIAL DISTRICT COURT
Fort Bend County Justice Center
1422 Eugene Heimann Circle
Courtroom: Room 3I
Telephone: 281-341-4409
Facsimile: unknown
e-mail: unknown
iii
TABLE OF CONTENTS
PAGE
IDENTITY OF PARTIES AND COUNSEL ............................................................i
TABLE OF CONTENTS .........................................................................................iv
TABLE OF AUTHORITIES ...................................................................................vi
STATEMENT OF THE CASE .................................................................................x
STATEMENT REGARDING ORAL ARGUMENT .............................................xi
STATEMENT OF JURISDICTION........................................................................xi
ISSUE PRESENTED ...............................................................................................xi
STATEMENT OF FACTS .....................................................................................13
SUMMARY OF THE ARGUMENT .....................................................................20
ARGUMENT ..........................................................................................................22
I. DESIGNATIONS OF RESPONSIBLE THIRD PARTIES ARE
LIBERALLY GRANTED. ...........................................................................22
A. Wynnewood's responsibility was intended to be considered and
apportioned by the jury at virtually all times. ....................................22
B. The statutory scheme encourages liability apportionment
among all responsible entities. ...........................................................24
II. THE DISTRICT COURT’S REFUSAL TO ALLOW THE
DESIGNATION OF WYNNEWOOD AS A RESPONSIBLE THIRD
PARTY WARRANTS MANDAMUS RELIEF. .........................................28
A. The mandamus standard is satisfied. ..................................................28
B. Mandamus relief is the rule for improper denial of a motion to
designate a responsible third party. ....................................................30
iv
C. The issues, facts, and evidence concerning Wynnewood are
interwoven with Plaintiffs’ allegations against Relators....................34
D. Relators’ motion for leave to designate a responsible third party
was timely...........................................................................................36
(1) Relators filed their motion more than 60 days before trial. .....36
(2) The statute of limitations did not bar Relators from
designating Wynnewood as a responsible third party. ............39
(3) Timely designation of Wynnewood avoided the
restrictions of section 33.004(d). .............................................40
E. Relators pleaded sufficient facts to designate Wynnewood as a
responsible third party. .......................................................................44
III. CONCLUSION AND PRAYER. .................................................................47
CERTIFICATION ..................................................................................................49
CERTIFICATE OF COMPLIANCE ......................................................................49
CERTIFICATE OF SERVICE ...............................................................................50
v
TABLE OF AUTHORITIES
PAGE
Cases
Avila v. St. Luke's Lutheran Hosp.,
948 S.W.2d 841 (Tex. App.—San Antonio 1997, writ denied) ...........................39
City of Dallas v. Abbott,
304 S.W.3d 380 (Tex. 2010) ................................................................................40
Coastal Corp. v. Torres,
133 S.W.3d 776 (Tex. App.—Corpus Christi 2004, pet. denied) ........................17
Encisco v. Chmielewshi,
16 S.W.3d 858 (Tex. App.—Houston [14th Dist.] 2000, no pet.) .......................39
Galbraith Eng’r Consultants, Inc. v. Pochucha,
290 S.W.3d 863 (Tex. 2009) ................................................................... 26, 27, 38
Horizon/CMS Healthcare Corp. v. Auld,
34 S.W.3d 887 (Tex. 2000) ........................................................................... 44, 46
In re Arthur Andersen LLP,
121 S.W.3d 471 (Tex. App.—Houston [14th Dist.] 2003,
orig. proceeding)........................................................................................... passim
In re Brokers Logistics, Ltd.,
320 S.W.3d 402 (Tex. App.—El Paso 2010,
orig. proceeding)................................................................................ 29, 30, 31, 32
In re Energy Res[s]. Tech. GOM, Inc.,
2012 WL 4754006 (Tex. App.—Houston [14th Dist.]
Oct. 4, 2012, orig. proceeding) .......................................................... 29, 31, 32, 33
In re Greyhound Lines, Inc.,
2014 WL 1022329 (Tex. App.—Dallas Feb. 21, 2014,
orig. proceeding)...................................................................................... 24, 30, 31
In re Houston M. Smith,
366 S.W.3d 282 (Tex. App.–Dallas 2012, orig. proceeding)...............................30
vi
In re Lewis Casing Crews, Inc.,
2014 WL 3398170 (Tex. App.—Eastland July 10, 2014,
orig. proceeding)........................................................................................... passim
In re Oncor Elec. Delivery Co.,
355 S.W.3d 304 (Tex. App.—Dallas 2011,
orig. proceeding)................................................................................ 25, 30, 31, 46
In re Team Rocket, L.P.,
256 S.W.3d 257 (Tex. 2008) ......................................................................... 29, 33
In re Unitec Elevator Servs. Co.,
178 S.W.3d 53 (Tex. App.—Houston [1st Dist.] 2005,
orig. proceeding)...................................................................................................26
Jones v. Ray,
886 S.W.2d 817 (Tex. App.—Houston [14th Dist.] 1994, no writ) ............. 27, 31
Kimbrell v. Molinet,
288 S.W.3d 464 (Tex. App.—San Antonio 2009, no pet.) ..................... 24, 25, 27
Love v. Four Mills of Am.,
647 F.2d 1058 (Okla. 1981) .................................................................................17
Oscar Luis Lopez v. La Madeleine of Tex., Inc.,
200 S.W.3d 854 (Tex. App.—Dallas 2006, no pet.) ............................................40
Roark v. Allen,
633 S.W.2d 804 (Tex. 1982) ................................................................................44
Ryland Group, Inc. v. White,
723 S.W.2d 160 (Tex. App.—Houston [1st Dist.] 1986, no writ) .......................31
Spencer v. BMW Of North America, LLC,
2015 WL 1529773 (W.D. Tex. April 2, 2015) .....................................................42
Tex. Health Enters., Inc. v. Geisler,
9 S.W.3d 163 (Tex. App.—Fort Worth, pet. dism’d) ..........................................39
Withers v. Schneider Nat’l. Carriers, Inc.,
13 F. Supp. 3d 686 (E.D. Tex. 2014) .............................................................. 40, 41
vii
Yeldell v. Holiday Hills Retirement & Nursing Ctr., Inc.,
701 S.W.2d 243 (Tex.1985) .................................................................................40
Statutes
Okla. Stat. Ann. tit. 12 § 1054 .................................................................................17
Okla. Stat. Ann. tit. 85 § 302....................................................................................16
TEX. CIV. PRAC. & REM CODE
§ 33.003 ........................................................................................................ passim
TEX. CIV. PRAC. & REM CODE
§ 33.004 ........................................................................................................ passim
TEX. CIV. PRAC. & REM. CODE
§ 16.001 ................................................................................................................39
TEX. CIV. PRAC. & REM. CODE
§ 16.001(b)............................................................................................................39
TEX. CIV. PRAC. & REM. CODE
§ 16.003(b)............................................................................................................18
TEX. GOV'T CODE,
§ 22.221(b)............................................................................................................ xi
Other Authorities
David W. Holman, Responsible Third Parties, 46 S. TEX. L. REV. 869, 885 (2005)
..............................................................................................................................26
TEX. CONST.
Article V, Section 6 .............................................................................................. xi
viii
Rules
TEX. R. APP. P., Rule 52 ......................................................................................... viii
TEX. R. CIV. P. 193.5 ................................................................................................37
Tex. R. Civ. P. 193.6(a) ...........................................................................................37
ix
STATEMENT OF THE CASE
This petition for a writ of mandamus addresses Judge Shoemake’s denial of
a motion for leave to designate a responsible third party pursuant to Chapter 33 of
the Texas Civil Practice and Remedies Code for the 434th District Court of Fort
Bend County, Texas.
The Real Parties in Interest are the Plaintiffs, who filed wrongful death
claims regarding the demise of Russell Mann and Billy Smith which occurred in a
refinery explosion in Wynnewood, Oklahoma during their employment for
Wynnewood Refining Company, LLC (“Wynnewood”). The Relators, who are the
remaining named defendants, are affiliated parent companies with equity interests
in and affiliated relationships with Wynnewood. The respondent is the Honorable
James H. Shoemake.
The Plaintiffs’ Original Petition was filed on September 30, 2013, naming
Wynnewood as a Defendant despite Wynnewood’s status as the decedents'
immune employer under Oklahoma’s workers’ compensation laws. For nineteen
months, Wynnewood participated as a party in all aspects of the litigation.
Throughout extended discovery and this litigation, Relators anticipated that
Wynnewood’s fault would be compared at trial.
On April 22, 2015, without advance notice and fifty-five days before the
original trial date, Plaintiffs non-suited their claims against Wynnewood. Twenty-
x
six days later, Relators amended their Rule 194 designations and filed their motion
to designate Wynnewood as a responsible third party to ensure that Wynnewood’s
fault, if any, could continue to be compared. That May 18, 2015 motion was not
ruled upon until October 12, 2015, when Judge Shoemake denied it. Trial, which
is now scheduled to begin October 20, 2015, is expected to last more than two
weeks and require more than fifteen out-of-state witnesses.
STATEMENT REGARDING ORAL ARGUMENT
Oral argument would materially assist the Court in understanding the
complex legal and factual background which supports the Relators’ proposed
designation.
STATEMENT OF JURISDICTION
This Court has jurisdiction to issue a writ of mandamus in this case under
Article V, Section 6 of the Texas Constitution, Section 22.221(b) of the Texas
Government Code, and Rule 52 of the Texas Rules of Appellate Procedure.
ISSUE PRESENTED
Did the district court abuse its discretion by denying Relators’ motion to
designate Wynnewood as a responsible third party where: (1) Wynnewood had
been an actively represented defendant in discovery and motion practice for more
than nineteen months; (2) without notice Plaintiffs non-suited Wynnewood fifty-
five days before the original trial date and five months before the final trial date;
(3) the Relators moved to designate Wynnewood as a responsible third party
xi
twenty-six days thereafter; and (4) the facts, evidence and issues concerning
Wynnewood’s responsibility for the accident are inseparable from Plaintiffs’
allegations against Relators?
xii
STATEMENT OF FACTS
1. On September 28, 2012, while Russell Mann and Billy Smith were
assisting in a re-start of the Wickes boiler at the Wynnewood Refinery in
Wynnewood, Oklahoma, the Wickes boiler suddenly exploded, killing both. Rec.
Tab 2 at ¶¶ 15-17.
2. At that time, Russell Mann and Billy Smith were employees of
Wynnewood Refining Company, LLC (“Wynnewood”), which is a subsidiary of
Relators, as explained below. Id. at ¶ 15.
3. The Plaintiffs/Real Parties in Interest are surviving family members of
Russell Mann and Billy Smith. Id. at ¶ 2-4; Rec. Tab 3 at ¶ 4.
4. On September 30, 2013, Plaintiffs filed their Original Petition, naming
Wynnewood and affiliated parent companies as Defendants. Rec. Tab 3.
Wynnewood and the Defendant Relators are affiliated entities within the CVR
Energy, Inc. group of companies.
5. CVR Energy, Inc. serves as the corporate parent of subsidiary entities
which own and operate two refineries,1 a fertilizer manufacturing operation, oil and
product pipelines, and related transportation assets. Rec. Tab 5 at Walter Affidavit
¶ 2.
1
One in Coffeyville, Kansas and one in Wynnewood, Oklahoma.
13
6. CVR Energy, Inc. is a Delaware corporation which has its corporate
offices in Sugar Land, Texas. CVR Energy, Inc. is a publicly-traded corporation
(NYSE: CVI) which owns the general partner and two-thirds of the limited partner
unit interests of CVR Refining, LP. Id. at ¶ 3.
7. At the time of the September 28, 2012 accident:
(i) CVR Refining, LP was an indirect, wholly-owned subsidiary of
CVR Energy, Inc. which had no interest in Gary-Williams Energy Company,
LLC or in Wynnewood Refining Company, LLC;
(ii) Gary-Williams Energy Company, LLC was an indirect, wholly-
owned subsidiary of CVR Energy, Inc.; and
(iii) Wynnewood Refining Company, LLC was a wholly-owned
subsidiary of Gary-Williams Energy Company, LLC.
Id. at ¶ 6 and attachment.
8. Wynnewood Refining Company, LLC ("Wynnewood") is a Delaware
limited liability company which has its principal place of business in Wynnewood,
Oklahoma. Since a CVR corporate group reorganization in 2013, Wynnewood is
presently an indirect, subsidiary of CVR Refining, LP. Two-thirds' interest of
CVR Refining, LP is owned by CVR Energy, Inc. Id. at ¶ 8 and attachment.
14
Plaintiffs' Allegations
9. Plaintiffs' Original, Amended Original Petitions (Rec. Tabs 2, 4, 6, 7,
and 8) and First Supplemental Petition (Rec. Tab 3) all allege negligence, gross
negligence or intentional conduct by Wynnewood. For illustrative purposes, the
following paragraphs will cite to the Third Amended and First Supplemental
Petitions, filed respectively on April 26 and May 29, 2015, as those were filed
before and after the Wynnewood non-suit and Relators' May 28, 2015 motion to
designate Wynnewood as a Responsible Third Party.
10. Plaintiffs allege that the Wickes boiler was gargantuan and archaic,
and was not equipped with a Boiler Management System (BMS) which would
have allowed for re-starts from a safe and remote site. Plaintiffs’ First
Supplemental Petition, Rec. Tab 3 at ¶¶ 15, 27, 18, 22, and Third Amended
Petition, Rec. Tab 2 at ¶¶ 16, 17, 18.
11. Plaintiffs claim that Wynnewood “was rife with dangerous practices
and working conditions.” Rec. Tab 3 at ¶ 23; Rec. Tab 2 at ¶ 24.
12. Plaintiffs assert that Wynnewood had actual knowledge of prior
detonations that occurred with that same boiler, but failed to properly repair,
maintain, and update the boiler to ensure that such occurrences would be
minimized or deterred. Rec. Tab 3 at ¶ 23; Rec. Tab 2 at ¶ 23.
15
13. Plaintiffs allege that Wynnewood’s acts and omissions were negligent
and grossly negligent and proximately caused Mann and Smith’s injuries. Rec.
Tab 3 at ¶ 38; Rec. Tab 2 at ¶ 39.
14. Plaintiffs allege that Relators—by sheer virtue of their Wynnewood
ownership rights—were negligent and grossly negligent and proximately caused
Mann and Smith’s injuries. Rec. Tab 3 at ¶¶ 38-40; Rec. Tab 2 at ¶¶ 39-41.
Specifically, Plaintiffs claim that Relators failed to exercise control over the
refinery to monitor dangerous conditions, upgrade equipment, and repair hazardous
conditions. Id.
Workers' Compensation Benefits
15. The Mann family and the Smith family each received and will
continue to receive workers' compensation benefits whose net present value is
more than $500,000 per family. Rec. Tab 5 at Ex. 2, Morrow Affidavit ¶¶ 4-5.
16. Wynnewood is an immune employer under the Oklahoma Worker's
Compensation Statute based on payments made on its behalf to the Plaintiffs.
Okla. Stat. Ann. tit. 85 § 302(A).
17. The Oklahoma workers' compensation benefits, provided pursuant to
the American Zurich policy, will ultimately pay approximately $1,181,654.00 to
the heirs of Russell Mann and Billy Smith. Rec. Tab 5 at Ex. 2, Morrow Affidavit
¶¶ 4-5.
16
Third Party Designation Pleadings
18. Plaintiffs sued Wynnewood and the Defendant Relator affiliated and
parent companies, alleging that the Relators, as corporate affiliates of Wynnewood,
had "alter ego" liability and/or "parental liability" 2 for the actions of Wynnewood.
(Rec. Tab 2 at ¶¶ 35-36; Rec. Tab 3 at ¶ 35.
19. Rigorous and substantial discovery commenced from the outset. On
December 30, 2013, in their initial response to discovery requests, the CVR and
Wynnewood Defendants produced the fifteen page Incident Report (Rec. Tab 1)
which faulted the operations, standard operating procedures, training, and operator
leadership of Wynnewood Refining Company, LLC (Id. at 14).
20. Plaintiffs thereafter took approximately sixteen depositions, eleven of
which were of Wynnewood employees. In four separate submissions, the Plaintiffs
served more than 150 requests for production, upon which Relators and
Wynnewood produced more than 16,000 pages of refinery documents, more than
1,000 emails, and more than 1,200 email attachments.
21. The applicable two-year statute of limitations (Okla. Stat. Ann. tit. 12
§ 1054) ran on September 28, 2014, for the wrongful death claims related to
2
There is no such thing as parental liability (i.e. a duty to control by reason of a corporate
entity's equity interests) in Texas, Oklahoma or the remaining states. See, e.g., Coastal Corp. v.
Torres, 133 S.W.3d 776, 778 (Tex. App.—Corpus Christi 2004, pet. denied); Love v. Four Mills
of Am., 647 F.2d 1058, 1062-63 (Okla. 1981).
17
Russell Mann. 3 However, being a minor, the Plaintiff Rogan Smith's wrongful
death claims related to Billy Smith will not expire for a number of years, until the
three-year-old Rogan reaches majority.
22. On April 22, 2015, without advance notice and fifty-five days prior to
the original trial date, Plaintiffs non-suited Wynnewood. Rec. Tab 14.
23. Twenty-six days later, on May 18, 2015, Relators served
Supplemental Rule 194 Disclosures designating Wynnewood as a responsible third
party, and filed a motion for leave to designate Wynnewood as a responsible third
party to ensure that Wynnewood's negligence would be compared at trial. Rec.
Tab 9.
24. Plaintiffs objected to Defendants Motion for Leave to Designate on
May 27, 2015. Rec. Tab. 10.
25. Defendants provided a written Reply in support of the Motion for
Leave to Designate on June 10, 2015. Rec. Tab 11.
26. On September 14, 2015, eight days before the jury trial then
scheduled for September 22, the Plaintiffs filed their Fourth Amended Original
Petition. Rec. Tab 8. In that pleading, the Plaintiffs continually alleged (as they
3
The Texas statute of limitation is substantively identical. TEX. CIV. PRAC. & REM. CODE §
16.003(b).
18
had throughout the underlying litigation) that Wynnewood Refining Company,
LLC’s acts and omissions caused the deaths of Russell Mann and Billy Smith:
37. . . . although Russell Mann and Billy Smith were
employees of Wynnewood Refining Company, LLC, Plaintiffs will
show this Court that Wynnewood Refining Company, LLC acted
willfully, deliberately and with specific intent to cause Russell Mann's
and Billy Smith's deaths.
38. Wynnewood Refining Company, LLC willfully,
deliberately, and intentionally caused the deaths of Billy Smith and
Russell Mann by willfully, deliberately, and intentionally committing
the following acts: . . . .
42. Accordingly, the actions of Wynnewood Refining
Company, LLC as referenced above evidence a willful and deliberate
intent to cause the deaths of Billy Smith and Russell Mann.”
43. . . . Wynnewood Refining Company, LLC acted with
knowledge that death or injury was substantially certain to result from
these actions. . . .
Rec. Tab 4.
27. Plaintiffs' petitions have consistently and steadfastly identified
Wynnewood as a responsible defendant and/or responsible third party throughout
the litigation, upon allegations of negligence, gross negligence or intentional
conduct by Wynnewood. Many of these allegations were made after the non-suit
notice of April 22, 2015:
19
Petitions Date Wynnewood Record Tab
Allegations
Original 09/30/13 ¶¶ 35, 39, 40 4
First 09/18/14 ¶¶ 35, 40, 41 6
Second 11/07/14 ¶¶ 35, 44, 45 7
Third 04/06/15 ¶¶ 36, 45, 46 2
First Supp. 05/29/15 ¶¶ 35, 43, 44, 45 3
Fourth 09/14/15 ¶¶ 33, 38, 42, 43 8
Fifth 09/15/15 13 4
28. On September 22, 2015, Judge Shoemake heard oral arguments on the
Relators' motion to designate. Rec. Tab 17.
29. On October 12, 2015, Judge Shoemake denied Relators’ motion to
name Wynnewood Refining Company, LLC as a responsible third party. Rec. Tab
16.
SUMMARY OF THE ARGUMENT
The district court abused its discretion by denying Relators’ Motion for
Leave to Designate Third Party. Texas case law establishes that a post-trial appeal
is not an adequate remedy because the court’s denial skews the proceedings,
affects the outcome, and compromises the defense in ways unlikely to be apparent
in the appellate record.
4
After the Relators filed a Supplemental Brief (Rec. Tab 12) identifying the allegations in
paragraph 26 above, and noting that all parties were in agreement concerning Wynnewood's
Responsible Third Party status, the Plaintiffs filed their Fifth Amended Petition deleting their
previous allegations Wynnewood (Rec. Tab 13).
20
The evidence presented to the district court demonstrated that Wynnewood,
should be submitted to the jury as a responsible third party. Specifically both the
CVR Entities and the Plaintiffs alleged that the accident occurred: (1) on
Wynnewood property, (2) under the supervision of Wynnewood personnel, (3)
within the scope of the deceased workers’ employment with Wynnewood, and (4)
as the result of the explosion of a boiler which was owned, operated and
maintained by Wynnewood. See Rec. Tab 9.
Relators’ motion complied with all applicable provisions of Texas Civil
Practice and Remedies Code § 33.004. Relators’ motion was filed more than 60
days prior to trial. Id. at § 33.004(a). Said motion was timely; it was filed 26 days
after Plaintiffs non-suited Wynnewood. Id. at § 33.004(d). Wynnewood was a
party during the entire time the statute of limitations was running. Plaintiffs
voluntarily non-suited Wynnewood seven months after the statute of limitations
would preclude the reassertion of wrongful death claims on behalf of Russell
Mann. However, then as now, the wrongful death claims related to Billy Smith
could be asserted through his minor son, Rogan Smith. Plaintiffs obviated the
necessity of Relators filing their designation and motion prior to said limitations
expiration, because Wynnewood need not be designated as a responsible third
party while it remained a party defendant. TEX. CIV. PRAC. & REM. CODE § 33.003
(a). The designation motion’s liability allegation pleadings were sufficient; they
21
came from Plaintiffs’ Petitions. TEX. CIV. PRAC. & REM. CODE § 33.004(g).
Moreover, the district court did not provide Relators with the opportunity to
replead the facts concerning Wynnewood’s responsibility prior to denying the
motion for leave as required by the Texas Civil Practice and Remedies Code. See
id.
ARGUMENT
I. DESIGNATIONS OF RESPONSIBLE THIRD PARTIES ARE
LIBERALLY GRANTED.
A. Wynnewood's responsibility was intended to be considered and
apportioned by the jury at virtually all times.
The Texas proportionate responsibility law “provides a framework for
apportioning percentages of responsibility in the calculation of damages in any
case in which more than one person, including the plaintiff, is alleged to have
caused or contributed to cause the harm for which recovery of damages is sought.”
In re Lewis Casing Crews, Inc., 2014 WL 3398170 at * 2 (Tex. App.—Eastland
July 10, 2014, orig. proceeding). Section 33.003(a) categorizes the persons and/or
entities to be compared for a determination of responsibility by the trier of fact.
See TEX. CIV. PRAC. & REM. CODE § 33.003. Wynnewood, as a named defendant,
met the criteria.
(a) The trier of fact, as to each cause of action asserted, shall
determine the percentage of responsibility, stated in whole numbers,
for the following persons with respect to each person’s causing or
contributing to cause in any way the harm for which recovery of
damages is sought, whether by negligent act or omission, by any
22
defective or unreasonably dangerous product, by other conduct or
activity that violates an applicable legal standard, or by any
combination of these:
(1) each claimant;
(2) each defendant;
(3) each settling person; and
(4) each responsible third party who has been designated under
Section 33.004.
TEX. CIV. PRAC. & REM. CODE § 33.003.
Subsection (2) of § 33.011 defines "Defendant" as:
any person from whom, at the time of the submission of the case to
the trier of fact, a claimant seeks recovery of damages.
Id. Subsection (6) of § 33.011 defines “Responsible third party” as:
any person who is alleged to have caused or contributed to causing in
any way the harm for which recovery of damages is sought, whether
by negligent act or omission, by any defective or unreasonably
dangerous product, by other conduct or activity that violates an
applicable legal standard, or by any combination of these. The term
“responsible third party” does not include a seller eligible for
indemnity under Section 82.002.
Id. Thus, from September 30, 2013 through April 22, 2015, all parties deemed
Wynnewood Refining Company, LLC to be a "defendant" which would be
compared on the verdict form of the trier of fact. See Rec. Tab 4, 13. On April 22,
2015, the Real Parties in Interest non-suited Wynnewood Refining Company, LLC.
Rec. Tab 13. For twenty-six days thereafter, Wynnewood would not be included
23
in the submission of a case for damage recovery. However, on May 18, 2015, the
Relators designated Wynnewood as a responsible third party and alleged that
Wynnewood caused or contributed to the harm for which recovery was being
sought. Rec. Tab 9. Thus, for all but twenty-six days of the twenty-four months
the parties have been in litigation, all knew that Wynnewood's determination of
responsibility was expected and intended. By means of discovery and of the
pleadings, the parties clearly knew and understood that Wynnewood's negligence
or fault would be compared with the Relators' potential responsibility.
B. The statutory scheme encourages liability apportionment among
all responsible entities.
Courts liberally grant designations of responsible third parties. See,
Kimbrell v. Molinet, 288 S.W.3d 464, 468 (Tex. App.—San Antonio 2009, no pet.)
(“Key to the application of Chapter 33 is the ability of defendants to liberally
designate responsible third parties . . . .”).
This statutory scheme has evolved into its current form which enables juries
to review the actions (or inactions) of all persons and entities potentially
responsible for the accident. See, e.g., In re Greyhound Lines, Inc., 2014 WL
1022329 at * 4 (Tex. App.—Dallas Feb. 21, 2014,
orig. proceeding) (“The proportionate responsibility statu[t]e grants parties the
right to have one jury apportion liability among all responsible parties.”); In re
Arthur Andersen LLP, 121 S.W.3d 471, 481, 486 (Tex. App.—Houston [14th
24
Dist.] 2003, orig. proceeding) (granting mandamus relief of denial of motion to
designate responsible third party, and discouraging the practice of asking the jury
to “put on blinders so that they can see only the alleged bad acts of [defendants].”).
The end result is that a defendant’s conduct is compared with all persons and
entities involved in the incident, and percentages of fault are attributed
accordingly.
Indeed, in Kimbrell, the court provided this historical overview:
In 2003, Chapter 33's proportionate responsibility framework was
amended to significantly liberalize the defendant’s ability to seek or
shift or spread liability to others. Under the amended section 33.004,
the defendant could merely designate a responsible third party rather
than join the responsible third party in the lawsuit as previously
required. Further, the definition of a responsible third party was
broadened to include ‘any person who is alleged to have caused or
contributed to causing in any way the harm for which recovery of
damages is sought.’ . . . [I]f the defendant properly designates a
responsible third party by filing a motion for leave, the court must
grant leave if there is no objection within fifteen days. Even if there
is an objection, the court must grant the designation unless the
defendant did not plead sufficient facts concerning the alleged
responsibility of the designated responsible third party.
Kimbrell v. Molinet, 288 S.W.3d at 469 (emphasis added; citations omitted). If a
defendant does not plead sufficient facts concerning the responsibility of the
designated third party, the court must grant leave to replead so that the defendant
can supplement the factual basis. TEX. CIV. PRAC. & REM. CODE § 33.004(g)(2).
Failure to do so is an abuse of discretion. See In re Oncor Elec. Delivery Co., 355
S.W.3d 304, 305 (Tex. App.—Dallas 2011, orig. proceeding) (“We conclude the
25
trial court abused its discretion in [denying motion for leave to designate
responsible third party] without granting leave to replead. . . .”).
Under the prior 1995 statute, certain parties, “such as the claimant’s
employer and the bankrupt were expressly exempt.” Galbraith Eng’r Consultants,
Inc. v. Pochucha, 290 S.W.3d 863, 868 n. 6 (Tex. 2009). “The 2003 amendments
substantially broadened the meaning of the term ‘responsible third party’ to
eliminate these restrictions.” Id.; see also, In re Unitec Elevator Services Co., 178
S.W.3d 53, 58 n.5 (Tex. App.—Houston [1st Dist.] 2005, orig. proceeding)
(“[U]nlike the predecessor statute, under the amended version a claimant’s
employer that is a subscriber to the workers compensation system is not precluded
from being designated as a responsible third party.”). 5 “Although the scheme
initially equated responsibility with liability to the plaintiff or claimant, this is no
longer the case.” Galbraith, 290 S.W.3d at 868. Now, “a defendant may designate
a responsible third party even though that party possesses a defense to liability, or
cannot be formally joined as a defendant, or both.” Id. at 868-69. As such,
5
To counter balance the designation of an immune employer, the Legislature provided that the
worker’s compensation lien shall be reduced by the percentage of fault attributed to the
employer. See David W. Holman, Responsible Third Parties, 46 S. TEX. L. REV. 869, 885
(2005) (“[T]he 2003 statute now permits immune employers to be submitted as an RTP and to be
used to reduce a defendants’ (sic) thresholds for joint and several liability. As a trade off for this
unusual submission, the legislators provided that the worker’s compensation carrier’s subrogated
lien will be reduced in accordance with the percentage of fault attributed by the trier of fact to the
employer.”).
26
Chapter 33 is “unconcerned with the substantive defenses of responsible third
parties.” Id. at 869.
The designations (and resulting fault assessment) may not be used in other
proceedings to impose liability on responsible third parties. See Kimbrell, at 469
(“[T]he designation of a responsible third party may not be used in any other
proceeding to impose liability on the designee.”). This protects third parties while
eliminating defendants’ use of the “empty chair defense.” See In re Arthur
Andersen LLP, 121 S.W.3d at 486 (quoting Jones v. Ray, 886 S.W.2d 817, 822
(Tex. App.—Houston [14th Dist.] 1994, no writ) (noting that the “empty chair
defense” is one of several ill effects of a court’s denial of a motion to designate a
responsible third party).
While Andersen was decided under the 1995 statute, its holding captures the
thrust of the 2003 changes and the now accepted rationale for providing mandamus
relief for the denial of motions to designate a responsible third party:
Even if Andersen could prosecute a separate suit against the third
parties, it is the opportunity to have one jury apportion liability among
all responsible third parties that Andersen seeks.
Relator has a substantial right to present the complete set of
intertwined facts and issues germane to his claims, to one factfinder,
in one proceeding, rather than in two separate suits that are all but
foreordained to generate, collectively, a decision destined to fail in the
appellate process. The denial of that right would introduce the ‘empty
chair defense,’ and thereby skew the progress and entire conduct of
the proceedings–with the resultant potential to affect the outcome of
the litigation profoundly, and to compromise the presentation of the
27
parties’ respective claims or defenses in ways unlikely to be apparent
in the appellate record.
Id. In sum, Chapter 33 ensures that defendants have the opportunity to submit the
entire universe of facts and issues for the jury’s determination of fault attributable
to each person and entity potentially responsible for the accident and must be
interpreted and applied consistently with that purpose.
II. THE DISTRICT COURT’S REFUSAL TO ALLOW THE
DESIGNATION OF WYNNEWOOD AS A RESPONSIBLE THIRD
PARTY WARRANTS MANDAMUS RELIEF.
A. The mandamus standard is satisfied.
Relators seek mandamus relief regarding the trial court’s erroneous
application of Chapter 33 to the facts of this case. The standard for mandamus
relief on a legal issue has been summarized as follows:
To be entitled to mandamus relief, a relator must meet two
requirements. First, the relator must show that the trial court clearly
abused its discretion. Second, the relator must demonstrate it has no
adequate remedy by appeal.
A trial court abuses its discretion if it reaches a decision so arbitrary
and unreasonable as to constitute a clear and prejudicial error of law.
When reviewing the trial court’s decision for an abuse of discretion,
the reviewing court may not substitute its judgment for that of the trial
court with respect to resolution of factual issues or matters committed
to the trial court’s discretion. Review of the trial court’s
determination of the legal principles controlling its ruling is much
less deferential. A trial court has no discretion in determining
what the law is or applying the law to the facts, even when the law
is unsettled. A clear failure by the trial court to analyze or apply
the law correctly will constitute an abuse of discretion.
28
In re Brokers Logistics, Ltd., 320 S.W.3d 402, 405 (Tex. App.—El Paso 2010,
orig. proceeding) (Citations omitted, emphasis added); see also In re Arthur
Andersen LLP, 121 S.W.3d at 486 (“[A]s to legal issues, an error amounting to an
abuse of discretion can be as simple as misinterpreting or misapplying the law.”).
“An appellate remedy is ‘adequate’ when any benefits to mandamus review
are outweighed by the detriments.” In re Energy Res[s]. Tech. GOM, Inc., 2012
WL 4754006 at * 1 (Tex. App.—Houston [14th Dist.] Oct. 4, 2012, orig.
proceeding). “This determination depends heavily on the circumstances presented
and is better guided by general principles than by simple rules.” Id. In benefit-
detriment evaluations, courts “consider whether mandamus will preserve important
substantive and procedural rights from impairment or loss.” In re Brokers
Logistics, Ltd., 320 S.W.2d at 408. Courts also consider “whether mandamus
review will “allow the appellate courts to give needed and helpful direction to the
law that would otherwise prove elusive in appeals from final judgments.” Id.
(quoting In re Team Rocket, L.P., 256 S.W.3d 257, 262 (Tex. 2008)). Finally,
courts consider whether mandamus relief will spare litigants and the public “the
time and money utterly wasted enduring eventual reversal of improperly conducted
proceedings.” Team Rocket, 256 S.W.3d at 262.
29
B. Mandamus relief is the rule for improper denial of a motion to
designate a responsible third party.
Mandamus relief is appropriate where, as here, a district court abuses its
discretion by denying a motion to designate a responsible third party. Each of the
following opinions grant mandamus relief based on the now well-established rule
of law that an appeal is an inadequate remedy for the denial of a motion to
designate a responsible third party. In re Arthur Andersen LLP, 121 S.W.3d at
486; In re Brokers Logistics, Ltd., 320 S.W.2d at 408-09; In re Lewis Casing
Crews, Inc., 2014 WL 3398170 at * 5; In re Greyhound Lines, Inc., 2014 WL
1022329 at * 4; In re Houston M. Smith, 366 S.W.3d 282, 287-89 (Tex. App.–
Dallas 2012, orig. proceeding); In re Oncor Elec. Delivery Co., 355 S.W.3d at 306.
For example, in Lewis Casing, the appellate court reviewed a petition for
mandamus relief under very similar circumstances to the case at bar. The plaintiff
was injured while working on a drilling rig within the scope of his employment.
Lewis Casing, 2014 WL 1022329 at * 1. The plaintiff sued several companies, but
omitted his immune employer, Diamond D. Id. The trial court denied Lewis
Casing’s motion to designate the employer as a responsible third party. Id. When
Lewis Casing’s motion to reconsider was denied, it petitioned for writ of
mandamus, which was granted. Id.
The Lewis Casing court noted that “Lewis Casing does not have the ability
to seek contribution from [plaintiff’s] employer, Diamond D, because Diamond D
30
has provided [plaintiff] with workers’ compensation benefits.” Id. at * 4. The
Court held that the trial court’s denial of Lewis Casing’s motion to designate the
employer as a responsible party could not be adequately addressed by an appeal
because the denial “‘would skew the proceedings, potentially affect the outcome of
the litigation, and compromise the presentation of [Lewis Casing’s] defense in
ways unlikely to be apparent in the appellate record.’” Id. at * 5 (citations
omitted). See also Brokers Logistics, 320 S.W.2d at 408 (same); Oncor Elec., 355
S.W.3d at 306 (same); Andersen, 121 S.W.3d at 486 (same); Greyhound Lines,
2014 WL 1022329 at * 4 (same). 6
The present trial is estimated to continue for more than two weeks. It will
require at least twenty witnesses, fifteen being from states other than Texas. The
6
The Andersen court cited these “severance” cases in which mandamus was granted based on
the same principle:
Jones v. Ray, 886 S.W.2d at 822-23 (granting mandamus relief because severance of the
plaintiffs’ claims against some defendants from claims against other defendants would
prohibit jury from apportioning appropriate percentage of responsibility for each
defendants’ conduct.”); Ryland Group, Inc. v. White, 723 S.W.2d 160, 163 (Tex. App.—
Houston [1st Dist.] 1986, no writ) (granting mandamus relief because severance of
defendants’ third-party claims violated the defendants’ right to have the liability of all
original third-party defendants determined in the primary suit under then version of
Chapter 33).
Andersen, 121 S.W.3d at 483. See also In re Energy Res[s]. Tech. GOM, 2012 WL 4754006 at *
1-2 (Tex. App.–Houston [14th Dist.] Oct. 4, 2012, orig. proceeding) (granting mandamus relief to
reverse trial court’s granting of plaintiffs’ motion to sever claim against a designated responsible
third party on grounds that “the third party claim is interwoven with the remaining action so that
they involve the same facts and issues.”).
31
Lewis Casing court held that mandamus relief was appropriate to avoid the waste
of resources caused by improper proceedings:
There will be a substantial waste of the litigants’ time and money if
they proceed to trial without the trial court’s error being corrected,
proceed through a direct appeal only to have the judgment reversed,
and then retry the entire case with Diamond D designated as a
responsible third party. . . . In this case, the potential waste of
resources, when combined with the possibility that Lewis Casing
may be unable to successfully prosecute an appeal from an
adverse judgment, supports the conclusion that Lewis Casing does
not have an adequate remedy by appeal.
Id. (emphasis added, citations omitted). See also Andersen, 121 S.W.3d at 486
(same); Brokers Logistics, 320 S.W.2d at 409 (same). As such, the Court held that
the trial court clearly abused its discretion by denying the motion to designate. Id.
In re Energy Resources Technology GOM, 2012 WL 4754006 at * 1-2 (Tex.
App.—Houston [14th Dist.] Oct. 4, 2012, orig. proceeding) presented similar
issues. There, a worker was fatally injured by a crane that collapsed while he was
working on a platform. Id. His parents filed a wrongful death action against the
companies that owned and operated the platform. Id. The defendants were granted
leave to designate as a responsible third party the company (Cargotec) responsible
for the maintenance and safety inspection of the crane. Id. The trial court,
however, subsequently granted the plaintiffs’ motion to sever the third party
claims. Id. at * 1.
32
The appellate court granted mandamus relief because the third party claims
were interwoven with the facts and issues alleged by the plaintiffs. Id. For
instance, the plaintiffs alleged that the defendants failed to properly inspect and
maintain the platform and its appurtenances. Id. The defendants alleged that
Cargotec was retained to inspect, maintain, and repair the crane and its component
parts. The Energy Resources Court held:
Whether the collapse of the crane was due to Cargotec’s negligence is
relevant to the plaintiffs’ claim against relators and will involve the
same issues, facts, and evidence. We find the third-party claim is
interwoven with the remaining action so that they involve the
same facts and issues. Accordingly, severance of relators’
contribution claims against Cargotec was an abuse of discretion.
Id. at * 2 (emphasis added; citations omitted). As shown below, this same rule of
law applies to the case at hand.
Clearly, an appeal is not an adequate remedy for the denial of Relators’
motion to designate a responsible third party. Mandamus relief in the instant
matter will "spare litigants and the public the time and money utterly wasted
enduring eventual reversal of improperly conducted proceedings." In re Team
Rocket, L.P., 256 S.W.3d at 262. The present issues, facts, and evidence
concerning Wynnewood are interwoven with Plaintiffs’ allegations against
Relators. As such, the benefits of mandamus review clearly outweigh the
detriments.
33
C. The issues, facts, and evidence concerning Wynnewood are
interwoven with Plaintiffs’ allegations against Relators.
Relators herein designated Wynnewood as a responsible third party because
it would be impossible to explain the occurrence without including Wynnewood’s
role. The accident occurred: (1) on Wynnewood property, (2) under the
supervision of Wynnewood personnel, (3) within the scope of the deceased
workers’ employment with Wynnewood, and (4) as the result of the explosion of a
boiler which was owned, operated and maintained by Wynnewood. Any and all
evidence regarding the explosion has a nexus with Wynnewood.
Any of the Relators' alleged failures of control address the underlying
deficiencies of Wynnewood's operations. Indeed, Plaintiffs allege that Relators
failed to exercise control over Wynnewood refinery's safety responsibilities to
monitor dangerous conditions, upgrade equipment, and repair hazardous conditions
at the refinery. Plaintiffs’ Third Amended Petition, Rec. Tab 2 at ¶ 29. It is
impossible to discuss these alleged deficiencies without explaining the
involvement of Wynnewood personnel. Comparison of the Relators' involvement
requires that Wynnewood’s role be viewed in proportional perspective, with fault
attributed accordingly.
The Formal Incident Investigation Report (Rec. Tab 1), dated December 5,
2012, addressed the fault for the Wynnewood accident, citing these “Root Causes”:
(a) Lead Operator used burner pressure as startup criteria;
34
(b) Operations failed to recognize high gas flow;
(c) Standard Operating Procedure did not include critical safety
information from earlier startup procedures as part of its current
startup procedure;
(d) Training did not include previous Wickes Boiler startup steps in latest
training; and
(e) Lead Operators failed to provide expected guidance.
Rec. Tab 1, pp. 12-14.7 All parties were aware of these conclusions sixteen
months prior to the non-suit of Wynnewood. Discussing fault for this incident
without considering and comparing the role of Wynnewood is impossible.
Twenty-six days after Plaintiffs non-suited their claims against Wynnewood,
Relators filed their motion to designate to ensure that Wynnewood’s fault would be
compared at trial. Rec. Tab 9. In support of their motion, Relators presented
allegations from the Plaintiffs’ Third Amended Original Petition, 8 which served as
Plaintiffs’ factual basis for suing Wynnewood. Relators simply adopted the
allegations which Plaintiffs had directed against Wynnewood for nineteen months.
Id.
The facts, evidence and issues concerning Wynnewood’s potential
responsibility are inseparable from Plaintiffs’ allegations against Relators.
Mandamus is appropriate to correct the unnatural and prejudicial severance that
7
This Report was produced to Plaintiffs prior to the filing of Plaintiffs’ Notice of Non-Suit
Without Prejudice As To Defendant Wynnewood Refining Company, LLC. Rec. Tab 14.
8
Since that time, the Real Parties in Interest revised their petition multiple times adding new
parties and asserting and deleting allegations against Wynnewood. See Rec. Tabs 3, 8, 13.
35
currently exists. Asking the jury to put on blinders and attach a percentage of fault
only to the Relators’ involvement—viewed in isolation from Wynnewood’s
involvement—would skew the proceedings, potentially affect the outcome of the
litigation, and compromise the presentation of Relators’ defense in ways unlikely
to be apparent in the appellate record. Lewis Casing, 2014 WL 1022329, at * 5
(citations omitted).
D. Relators’ motion for leave to designate a responsible third party
was timely.
(1) Relators filed their motion more than 60 days before trial.
Relators’ motion complies with the timeliness requirement of § 33.004(a),
which states:
A defendant may seek to designate a person as a responsible third
party by filing a motion for leave to designate that person as a
responsible third party. The motion must be filed on or before the 60th
day before the trial date unless the court finds good cause to allow the
motion to be filed at a later date.
TEX. CIV. PRAC. & REM. CODE § 33.004(a). This case is scheduled for trial on
October 20, 2015. Relators filed their motion on May 18, 2015—181 days before
trial. Hence, Relators’ motion was timely. Any argument to the contrary is
frivolous.
In the proceedings below, Plaintiffs argued that Relators’ motion to
designate was not timely. At the time of filing, trial was scheduled for June 16,
2015. The trial court subsequently continued the trial setting to September 22,
36
2015, and then to October 20, 2015. However, Relators’ motion would have been
timely even if the trial proceeded on June 16, 2015.
The 60 day window provided by §33.004(a) is clearly designed to allow
plaintiffs to engage in discovery with, and/or join the designated responsible third
party prior to trial. Such a provision prevents a defendant from sandbagging the
plaintiff with a last minute designation; it provides a plaintiff with recourse
through joinder. It also ensures that the plaintiff will have adequate time to address
all responsible third party issues in advance of trial. None of these concerns apply
here.
From commencement of suit on September 30, 2013 until April 22, 2015,
the fault of Wynnewood was to be compared at trial. For 19 months it was totally
unnecessary to designate Wynnewood as a responsible third party. Wynnewood
was a defendant whose proportionate fault would be determined pursuant to
section 33.003(a)(2) of the Texas Civil Practice and Remedies Code. The need to
designate Wynnewood arose only after Wynnewood was jettisoned by Plaintiffs’
notice of non-suit. The non-suit occurred when trial was less than 60 days away.
The Texas Civil Practice and Remedies Code does not empower plaintiffs to
unilaterally preclude designations by suing a potentially responsible party and then
dismissing within the 60 day window. Such action would constitute plaintiffs'
sandbagging. Neither plaintiffs nor defendants should be permitted to use the
37
responsible third party procedures to circumvent and distract Chapter 33's purpose
of determining and allocating all potential fault in one action.
Relators filed their motion to designate within 26 days of Plaintiffs’ non-suit
notice. See Rec. Tab 9, 14. Any discovery (and related trial preparation) regarding
Wynnewood’s involvement had already been undertaken during the 19 months that
Wynnewood was a defendant. During those 19 months, Wynnewood asserted it
was an immune employer under Oklahoma’s workers’ compensation laws, which
undoubtedly prompted Plaintiffs to non-suit their claims against Wynnewood.
However, one may be designated as a responsible third party even if there exists a
legal defense to liability, Galbraith, 290 S.W.3d at 868-69, and Defendants' timely
designation of Wynnewood could not have surprised or ambushed Plaintiffs.
Indeed, Relators utilized Plaintiffs’ own allegations of negligence to support their
motion. Plaintiffs cannot argue that they have been sandbagged or in any way
prejudiced by the designation of Wynnewood as a responsible third party.
Plaintiffs filed a First Original Supplemental Petition on May 29, 2015—11
days after Relators moved to designate Wynnewood as a responsible third party.
That Supplemental Petition added claims on behalf of a minor child, Rogan Smith,
who had not yet been identified as a plaintiff. Thus, Relators’ motion to designate
a responsible third party preceded the joinder of a new plaintiff in this case. In
short, Relators motion was timely, reasonable, and appropriate.
38
(2) The statute of limitations did not bar Relators from
designating Wynnewood as a responsible third party.
At the time that Plaintiffs’ filed their Notice of Non-Suit, the statute of
limitations had not, and has not, run on the claims of Plaintiff Rogan Smith, a
minor. The limitations period on those claims will not expire until after Rogan
Smith reaches the age of majority. TEX. CIV. PRAC. & REM. CODE §§ 16.001,
16.003; see also Encisco v. Chmielewshi, 16 S.W.3d 858, 860 (Tex. App.—
Houston [14th Dist.] 2000, no pet.) (“The record demonstrates that at the time of
her father’s death, Christina was three years old. Thus, on the accrual date of the
cause of action, Christina was under a legal disability. Therefore, section
16.001(b) operates to toll the two year statute of limitations until Christina reaches
the age of eighteen.”). Hence, subsection (d) of Section 33.004 did not bar or
restrict Defendants’ statutory right to designate Wynnewood. TEX. CIV. PRAC. &
REM. CODE § 33.004(d) (emphasis added).9
9
Following the hearing on the motion for leave to designate Wynnewood as a responsible third
party, Rogan Smith’s guardian ad litem filed a notice of non-suit of Rogan Smith’s claims,
seeking to dismiss Rogan Smith’s claims without prejudice to refiling. Rec. Tab 15. However,
that notice, which was not filed by Rogan Smith’s attorney of record, is irrelevant because one
cannot bring a claim under the Texas Wrongful Death Act piecemeal. All of a deceased
individual’s wrongful death beneficiaries are required to present their claims in a single lawsuit.
Avila v. St. Luke's Lutheran Hosp., 948 S.W.2d 841, 850 (Tex. App.—San Antonio 1997, writ
denied). Tex. Health Enters., Inc. v. Geisler, 9 S.W.3d 163, 169 (Tex. App.—Fort Worth, pet.
dism’d) (holding a judgment “cannot stand” where the record shows that all statutory
beneficiaries are not parties to the lawsuit, or that the wrongful death claims have not been
brought for the benefit of all the statutory beneficiaries). Relators have filed a plea in abatement
addressing these issues in the trial court, which plea is currently pending.
39
(3) Timely designation of Wynnewood avoided the restrictions
of section 33.004(d).
Section 33.004(d) allows a defendant to designate a responsible third party
after the statute of limitations has run, as long as the defendant timely discloses (if
obligated) that said third party may be so designated:
A defendant may not designate a person as a responsible third party
with respect to a claimant's cause of action after the applicable
limitations period on the cause of action has expired with respect to
the responsible third party if the defendant has failed to comply
with its obligations, if any, to timely disclose that the person may
be designated as a responsible third party under the Texas Rules
of Civil Procedure.
TEX. CIV. PRAC. & REM. CODE § 33.004(d)(emphasis added). Courts construe the
“timely disclosure” requirement of § 33.004(d) to require “a just and reasonable
result.” Withers v. Schneider Nat’l. Carriers, Inc., 13 F. Supp. 3d 686, 690 (E.D.
Tex. 2014) (citing City of Dallas v. Abbott, 304 S.W.3d 380, 384 (Tex. 2010)) (“In
construing the ‘timely disclosure’ requirement of § 33.004(d), however, this Court
must presume that the Texas Legislature intended “’a just and reasonable
result.’”). 10
10
Parties commonly disclose such information through discovery. A party is under a duty to
supplement its discovery responses if the party knows the responses are incomplete or are no
longer true. TEX. R. CIV. P. 193.5; Yeldell v. Holiday Hills Retirement & Nursing Ctr., Inc., 701
S.W.2d 243, 246 (Tex.1985) (applying predecessor rule); Oscar Luis Lopez v. La Madeleine of
Tex., Inc., 200 S.W.3d 854, 860 (Tex. App.—Dallas 2006, no pet.). TEX. R. CIV. P. 193.6(a);
Oscar Luis Lopez, 200 S.W.3d at 860.
40
The purpose of § 33.004(d) is to allow a plaintiff to join a designated
responsible third party in time to recover damages associated with that party's fault.
See, e.g., Withers, 13 F. Supp. 3d at 691 (“[A] defendant has a duty to disclose the
existence of any potential responsible third parties as soon as reasonably possible,
so a plaintiff may have an opportunity to join such parties before they are time
barred.”). This ensures that the plaintiff has recourse if the defendant seeks to shift
alleged liability to a third party. Id., at 690-91.
Here, Plaintiffs never had recourse against Wynnewood. Wynnewood was
immune during the 19 months it was a party, immune during the 26 days it was
non-suited, and immune during the five months that Relators' motion to designate
was pending. Relators’ discovery responses did not require updating until
Plaintiffs dismissed their claims against Wynnewood. Plaintiffs sued Wynnewood
on September 30, 2013.11 Wynnewood answered and actively participated in this
litigation until Plaintiffs’ dismissed their claims against Wynnewood on April 22,
2015—nearly seven months after the statute of limitations for those claims had
expired.12 Prior to April 22, Relators’ disclosures were correct. Wynnewood was
a defendant whose proportionate liability would be evaluated by the jury.
Wynnewood could not also be designated as a responsible third party at that time.
11
Plaintiff’s Original Petition (Rec. Tab. 4).
12
Again, Rogan Smith's claims for the wrongful death of Billy Smith, which must be tried in the
underlying lawsuit, are not time barred
41
Wynnewood could not simultaneously be a joined party and an unjoined third
party in the lawsuit.
Twenty-six days after non-suit, on May 18, 2015, Defendants provided
Plaintiffs with supplemental disclosures, now designating Wynnewood as a
potential responsible third party. 13 Relators filed their Motion for Leave to
Designate Third Party on the same day so as to avoid any delay or
misunderstanding following Plaintiffs’ eleventh hour dismissal of claims.
Plaintiffs certainly cannot complain about the timing of this designation. It
was Plaintiffs who decided to non-suit their Wynnewood claims after the statute of
limitations had expired on the Mann claims. 14 By so doing, Plaintiffs eliminated
the possibility of Relators filing a motion to for leave to designate Wynnewood as
a responsible third party prior to the statute of limitations expiration. See Spencer
v. BMW Of North America, LLC, 2015 WL 1529773 at * 2 n. 4 (W.D. Tex. April 2,
2015) (holding that designation after limitation period ran was timely where
plaintiff filed suit eight days before the statute ran and explaining “If the purpose
of the timeliness requirement is to afford the plaintiff an opportunity to name the
responsible third party as a defendant in the suit, Plaintiff eliminated such a
13
Exhibit A [Defendants’ Joint Amended Response To 194.2(l) Of Plaintiffs’ Requests For
Disclosure].
14
Although the statute of limitations had now expired, the statute obviously had no effect on the
actual damages asserted against Wynnewood; Wynnewood was already under workers'
compensation immunity.
42
possibility by filing her case so close to the expiration of the statute of
limitations.”)(Emphasis added).
Indeed, even after they non-suited their claims against Wynnewood, the
Plaintiffs continue to allege that its acts and omissions caused the deaths at issue in
the underlying lawsuit. On September 14, 2015, the Real Parties in Interest filed
their Fourth Amended Original Petition. Rec. Tab 8. There, the Plaintiffs alleged,
in four separate paragraphs (see Facts at ¶ 26) that "Wynnewood Refining
Company, LLC willfully, deliberately and intentionally caused the deaths of Billy
Smith and Russell Mann." Rec. Tab 8 at ¶ 38. The Real Parties in Interest alleged
that Wynnewood Refining Company, LLC deliberately caused the deaths of Billy
Smith and Russell Mann in a pleading filed one week prior to the second scheduled
trial date in this matter. Rec. Tab 8. Again, the Plaintiffs/Real Parties in Interest
can hardly complain that the motion for leave was not timely as it preceded their
own allegations against Wynnewood by four months.
In sum, Relators complied with all applicable provisions of § 33.004.
Relators’ motion to designate Wynnewood as a responsible third party was timely
pursuant to the language of § 33.004(a) and (d), and it provided a just and
reasonable result under the circumstances -- the exact result contemplated by
§ 33.004(d).
43
E. Relators pleaded sufficient facts to designate Wynnewood as a
responsible third party.
Under § 33.004(g), it is the Plaintiffs’ burden to prove that Relators failed to
plead sufficient facts concerning Wynnewood’s responsibility:
If an objection to the motion for leave is timely filed, the court shall grant
leave to designate the person as a responsible third party unless the objecting
party establishes:
(1) the defendant did not plead sufficient facts concerning
the alleged responsibility of the person to satisfy the
pleading requirement of the Texas Rules of Civil
Procedure; and
(2) after having been granted leave to replead, the defendant
failed to plead sufficient facts concerning the alleged
responsibility of the person to satisfy the pleading
requirements of the Texas Rules of Civil Procedure.
TEX. CIV. PRAC. & REM. CODE § 33.004.
Texas imposes a “fair notice” standard for pleading, which looks to whether
the opposing party can ascertain from the pleading the nature and basic issues of
the controversy and what testimony will be relevant. Horizon/CMS Healthcare
Corp. v. Auld, 34 S.W.3d 887, 896 (Tex. 2000). “A petition is sufficient if it gives
fair and adequate notice of the facts upon which the pleader bases his claim. The
purpose of this rule is to give the opposing party information sufficient to enable
him to prepare a defense.” Roark v. Allen, 633 S.W.2d 804, 810 (Tex. 1982).
In support of their motion, Relators selected facts directly from Plaintiffs’
Third Amended Petition. This is a common and acceptable pleading practice. See,
44
e.g., Andersen, 121 S.W.3d at 482 (“Andersen has shown that the third-party
defendants are implicated in the Plaintiffs’ pleadings to such an extent that the
Plaintiffs could have sued each third party, and that each third party ‘may’ be liable
to the Plaintiffs for all or a part of the ‘damages claimed’ against Andersen and the
other defendants.”). Consequently, the Plaintiffs must prove that the very
allegations the Plaintiffs themselves made against Wynnewood provide insufficient
notice of Wynnewood’s potential responsibility for the accident.
In their motion, Relators asserted:
The plaintiffs allege that Mann and Smith were employees of
Wynnewood Refining Company (“Wynnewood”), and that on the
evening of September 28, 2012 Mann and Smith were assisting in a
“re-start” of a Wickes boiler at the refinery. 15 The plaintiffs allege
that Smith was tasked with the duty of watching the fire-eye of the
boiler to check for ignition of the boiler’s pilot light, and that Mann
was charged with the duty of turning the gas valve connected to the
boiler. 16 The personnel at the Wynnewood refinery who tasked Smith
and charged Mann with those responsibilities were themselves
employed by and acting for Wynnewood. The plaintiffs allege that as
Mann and Smith were performing their tasks, the boiler exploded,
killing them. 17
The plaintiffs allege that Wynnewood “was rife with dangerous
practices and working conditions.” 18 They allege that Wynnewood
had actual knowledge of prior detonations occurring with the boiler
15
Defendants’ Motion for Leave To Designate Responsible Third Party Rec. Tab 9 at 2, which
cites Plaintiff’s Third Amended Original Petition at ¶ 16.
16
Id. at ¶ 19-20).
17
Id. at ¶ 21).
18
Id. at ¶ 24).
45
but failed to properly repair, maintain, and update the boiler to ensure
that such occurrences would be minimized. 19 The plaintiffs allege
that Wynnewood Refining Company’s acts and omissions were
negligent and grossly negligent and proximately caused Mann and
Smith’s injuries. 20
By quoting the Plaintiffs’ own language back to them, Relators have
provided “fair notice” of the nature and basic issues of the litigation, as well as
what testimony will be relevant. Horizon/CMS Healthcare Corp., 34 S.W.3d at
896. Plaintiffs sued Wynnewood based on the same allegations. Clearly, there is
no heightened notice requirement for motions to designate a responsible third
party. Relators pleaded sufficient facts to designate Wynnewood as a responsible
third party. TEX. CIV. PRAC. & REM. CODE § 33.004(g).
If the denial was based on an insufficient pleading designation, the district
court erred by failing to provide Relators with the opportunity to replead in order
to supply sufficient facts, as mandated by § 33.004(g). Id. Failure to do so
constitutes an abuse of discretion. See, In re Oncor Elec. Delivery Co., 355
S.W.3d 304, 305(Tex. App. – Dallas 2011)(“We conclude the trial court abused its
discretion in [denying motion for leave to designate responsible third party]
without granting leave to replead. . . .”). If this Court determines that Relators
have not pleaded sufficient facts, then mandamus relief is appropriate to provide
Relators with that statutorily mandated opportunity.
19
Id. ¶ 23).
20
Id. ¶ 33-39).
46
III. CONCLUSION AND PRAYER.
Texas appellate courts hold that mandamus relief is appropriate when a
district court abuses its discretion by denying a motion to designate a responsible
third party. An appeal is not an adequate remedy because the court’s denial of the
motion skews the proceedings, affects the outcome, and compromises the defense
in ways unlikely to be apparent in the appellate record.
Mandamus relief should be granted to allow the designation of Wynnewood
as a responsible third party because Relators’ motion complied with all of the
requirements of § 33.004. The motion, filed more than 60 days before trial and
promptly after the Plaintiffs non-suited their claims against Wynnewood, was
timely.
The issues, facts, and evidence in support of Relators’ motion are
inseparable from Plaintiffs’ allegations against Relators. Sufficient facts to support
the designation were generated from Plaintiffs’ Petitions. The allegations against
the Relators spring directly from what was done or not done by Wynnewood.
WHEREFORE the Relators pray that this Court issue a Writ of Mandamus
requiring the District Court of Fort Bend County, Texas to vacate its Order
denying Relators’ Motion for Leave to Designate Third Party and ordering that
leave be granted for Wynnewood to be designated as a Responsible Third Party,
that its fault might be compared at the time of trial.
47
Respectfully submitted,
MARTIN, DISIERE, JEFFERSON &
WISDOM, L.L.P.
By: /s/ Phillip D. Sharp
Phillip D. Sharp
Texas State Bar No. 18118680
808 Travis, 20th Floor
Houston, TX 77002
Telephone: (713) 632-1700
Facsimile: (713) 222-0101
sharp@mdjwlaw.com
SMITHYMAN & ZAKOURA,
CHARTERED
By: /s/ Lee M. Smithyman
Lee M. Smithyman
KS Supreme Court #09391
750 Commerce Plaza II
7400 West 110th Street
Overland Park, KS 66210-2362
Telephone: (913) 661-9800
Facsimile: (913) 661-9863
lee@smizak-law.com
Application for admission pro hac vice
pending
ATTORNEYS FOR RELATORS
48
CERTIFICATION
The undersigned has reviewed the petition and concluded that every factual
statement in the petition is supported by evidence included in the record.
/s/ Philip D. Sharp
Philip D. Sharp
CERTIFICATE OF COMPLIANCE
This is to certify that this computer-generated Petition for Writ of
Mandamus contains 8,424 words and complies with rule 9.4 of the Texas Rules of
Appellate Procedure.
/s/ Philip D. Sharp
Philip D. Sharp
Dated: October 14, 2015
49
CERTIFICATE OF SERVICE
I hereby certify that true and correct copies of the foregoing instrument have
been forwarded to all known counsel of record in accordance with the Texas Rules
of Civil Procedure on this the14th day of October, 2015, via the method indicated
below:
Gary M. Riebschlager
The Riebschlager Law Firm
801 Congress, Suite 250
Houston, TX 77002
gary@riebschlagerlaw.com
cecilia@riebschlagerlaw.com
via e-mail and US Mail
Richard L. Tate
Tate, Moerer & King, LLP
206 South Second Street
Richmond, TX 77469
rltate@tate.law.com
via e-mail and US Mail
Sidney F. Robert
Brent Coon & Associates
300 Fannin, Suite 200
Houston, TX 77002
sidney.robert@bcoonlaw.com
belinda@bcoonlaw.com
via e-mail and US Mail
David M. Medina
The Medina Law Firm
5800 Memorial Drive, Suite 890
Houston, TX 77007
davidmedina@justicedavidmedina.com
via e-mail and US Mail
50
The Honorable James H. Shoemake
434th JUDICIAL DISTRICT COURT
Fort Bend County Justice Center
1422 Eugene Heimann Circle
Courtroom: Room 3I
Telephone: 281-341-4409
Via e-filing
/s/ Philip D. Sharp
Philip D. Sharp
Dated: October 14, 2015
51
APPENDIX
INDEX TO APPENDICES TO PETITION FOR WRIT OF MANDAMUS
Tab 1 Order, October 12, 2015
Tab 2 Transcript of September 22, 2015 Hearing
Tab 3 Formal Incident Investigation Report
Tab 4 Tex. Civ. Prac. & Rem § 33.004
Tab 5 Tex. Civ. Prac. & Rem § 33.003
TAB 1
TAB 2
TAB 3
TAB 4
TAB 5