The Corpus Christi Court of Appeals has issued a writ of mandamus ordering a Hidalgo County district court to vacate an order reversing a prior order transferring venue of various hospital lien cases to Fort Bend County. The case is somewhat procedurally complex but contains important jurisprudence on the operation of the jurisdiction and authority of and motion practice in multidistrict litigation courts.
In re Signature Care Emergency Center and Round Table Physicians Group, PLLC (No. 13-22-00366-CV; filed March 14, 2023) arose from lawsuits brought by several plaintiffs in Hidalgo County alleging fraudulent hospital liens. In each case, plaintiffs hired attorneys to represent them against third parties regarding their injuries. Rather than bill insurance for the charges, however, the providers filed hospital liens to the incurred charges. Plaintiffs alleged that the liens were fraudulent because they were not “admitted” to the hospital and the providers had no right to file the liens since they were not “hospitals” as defined by Chapter 55, Property Code. Plaintiffs further alleged that the charges were excessive and that the providers tortiously interfered with settlement negotiations with insurance carriers. Plaintiffs sought class certification and argued that venue was proper in Hidalgo County. They also filed notices that their cases were transferred as “tag-along” cases to a Cameron County multidistrict litigation from fraudulent lien cases (In re Fraudulent Hospital Lien Litigation, No. 15-360).
Defendants filed a motion to transfer venue on the basis that none of them did any business in Hidalgo County, plaintiffs sought and received treatment in Fort Bend County (where the accidents occurred), and Fort Bend County, not Hidalgo, was a county of mandatory venue under the hospital lien statute. They subsequently filed a motion to remand he cases from the Cameron County MDL pretrial court to courts in Fort Bend County. While the pretrial court was considering the motions, the MDL panel issued a per curiam order in the Cameron County MDL, stating that only hospital lien and tag-along cases involving McAllen Hospitals and its affiliates were included in the MDL. When defendants notified the pretrial court of the decision, they moved to remand the cases back the courts of origin in Hidalgo County for hearings on the transfer of venue motions. Again, in the meantime, the MDL panel issued another order stating that the Fort Bend County had jurisdiction only in hospital lien cases and tag-along cases against Signature and Round Table, the defendants, in Fort Bend and Harris Counties (In re Freestanding Emergency Medical Care Facilities Lien Litigation, No. 19-0499). Subsequently, the Cameron County pretrial court transferred venue of plaintiffs’ cases to a district court in Fort Bend County but did not remand the cases to the courts of origin first. Plaintiffs objected on the basis that the pretrial court, having lost jurisdiction, could only remand the cases to Hidalgo County. Defendants argued that when the MDL panel limited the scope of the Cameron County MDL, the pretrial court lost jurisdiction over plaintiffs’ claims after the change of venue. They requested remand to the Fort Bend and Harris County MDL. Following a hearing, the pretrial court vacated its earlier order transferring venue to Fort Bend County and remanded the cases to Hidalgo County.
Defendants sought mandamus, arguing that the pretrial court abused its discretion by vacating its order transferring venue or, alternatively, by refusing to grant their motion to remand contemporaneously with its order to transfer venue. In an opinion by Justice Silva, the court of appeals agreed. The court’s analysis commenced with a review of the purposes of multidistrict litigation courts and their operation under Texas Rules of Judicial Administration 13. Rule 13 gives an MDL pretrial judge exclusive jurisdiction over each case transferred to it, unless a case is retransferred by the panel or is otherwise finally resolved. The MDL panel also has the authority to transfer cases from one pretrial court to another “when transfer will promote the just and efficient conduct of the cases.” This did not happen here, leaving the court of appeals to navigate the procedure by which a case declared outside the jurisdiction of one MDL pretrial court can make its way to the proper MDL court by means other than the MDL panel.
The first issue was whether the Cameron County pretrial court lost jurisdiction over the cases before making its initial order to transfer venue. The court held that since the MDL panel did not transfer the cases and they were not otherwise resolved, the Cameron County pretrial court retained jurisdiction to rule on the venue motion. Furthermore, despite plaintiffs’ argument to the contrary, the pretrial court could consider the venue motion before determining its jurisdiction based on “considerations of convenience, fairness, and judicial economy” (citations omitted) and considering jurisdiction in the first instance is only strictly necessary when the court is planning to address the cases on the merits. Having held that the pretrial court had jurisdiction to consider venue, the court turned next to whether, once defendants had specifically denied plaintiffs’ alleged venue facts and had presented specific evidence of proper venue, plaintiffs met their burden to present prima facie proof that venue was proper in Hidalgo County. The court held that they did not and that defendants proved that venue was proper in Fort Bend County.
Issue number three was whether the Cameron County Court had jurisdiction to vacate its prior order transferring venue to Fort Bend County (again, without remanding to the courts of origin first). In face of the general rule that “only one venue determination may be made in a single proceeding and [TRCP 87] prohibits changes in venue following the initial ruling on venue” (citations omitted), and the fact that plaintiffs never filed a motion for rehearing or reconsidering within the pretrial court’s 30-day plenary authority period, the court concluded that the pretrial court had lost jurisdiction over the transfer order, the order was final, and the pretrial court had no jurisdiction to vacate.
Finally, the court considered whether defendants had an adequate remedy by appeal. Plaintiffs argued that they did because the cases could just be tagged into the Harris and Fort Bend County MDL and the motion to transfer venue could be considered there. The problem, however, was that one venue ruling had already been made in the case. The court thus concluded that, “given the instant circumstances,” [we disagree] that there can be another” (citations omitted). Although venue rulings are ordinarily considered upon appeal of the final judgment, under certain circumstances, such as rulings involving multiple parties, may be reviewed on an interlocutory basis. Weighing the benefits of mandamus review against the detriments, as SCOTX outlined in In re Prudential and In re Team Rocket, L.P., the court concluded that mandamus review was warranted. Denying review would result in “an irreversible waste of resources” in improperly conducted proceedings. Review, however, would promote development of the law and give clarity to how venue motions should be handled in connection with MDL litigation.
The court concluded that the proper remedy under Rule 13 was to remand the cases to the courts of origin in Hidalgo County, since the rule provides that the pretrial court may only enter a final, appealable judgment, or order remand “when pretrial proceedings have been completed to such a degree that the purposes of the transfer have been fulfilled or no longer apply.” Rule 13 does not give the pretrial court authority to transfer a case to another MDL or remand the case to another court (i.e., Fort Bend County, as defendants requested). The court ordered the pretrial court to send the cases back to Hidalgo County, “where we note that the pretrial court’s venue order is, generally speaking, ‘binding in the trial court after remand.’” The upshot is that the courts of origin are bound to transfer the cases to Fort Bend County.
It appears to us that plaintiffs tried to forum shop their Fort Bend County cases in Hidalgo County. The MDL panel and the court of appeals foiled the plan, and the cases, should they survive, will end up in Fort Bend County where they belong. This is another case in which courts of appeals have to do a lot of the dirty work necessary to preserve the integrity of the system. They get a lot of criticism for making mistakes, as everyone does, but not anywhere near enough credit for the vast majority of cases, like this one, in which they don’t.
