The Texas House will debate three important civil justice reform bills on Friday, May 8. HB 1692 by Rep. Kenneth Sheets (R-Dallas) modifies the doctrine of forum non conveniens to clarify that the Texas resident exception applies to legal residents of Texas and persons with derivative claims from a legal Texas resident. If a claimant is not a legal resident, the court may still allow the claim to proceed if the court finds that the case has a significant connection to Texas under the balancing test in the current law. Finally, the bill clarifies that peripheral parties, such as next friends, estate administrators, guardians, and others are not considered “plaintiffs” under the statute. These parties and their claims would be considered under the balancing test applicable to non-residents. HB 1692 is a negotiated compromise between stakeholder groups and has no remaining organized opposition to our knowledge.
SB 735 by Sen. Troy Fraser (R-Horseshoe Bay)/HB 969 by Rep. Ken King (R-Pampa) deals with the admissibility of evidence of a defendant’s net worth in a claim for punitive damages. Under current law, there are no guidelines regarding the scope or type of financial information that may be discovered by a claimant to establish the defendant’s net worth for purpose of an award of punitive damages. This lack of guidance can lead to the admission of misleading and potentially inflammatory evidence that does not bear on the defendant’s alleged conduct. SB 735 clarifies current law by defining net worth as a person’s total assets minus total liabilities on a date determined appropriate by the trial court. The bill also allows a trial court to authorize discovery of a defendant’s net worth if, after notice and hearing, the court finds that the claimant has demonstrated a substantial likelihood of prevailing on the claim for punitive damages. The trial court’s order may only authorize use of the least burdensome method available to obtain net worth evidence.
HB 1492 by Rep. Doug Miller (R-New Braunfels) requires a claimant alleging an asbestos or silica-related disease to make and disclose claims against bankruptcy trust funds prior to trial. The bill gives the Texas multi-district asbestos and silica litigation courts the ability to stay a trial until the claimant gives notice of all trust claims and to modify a judgment based on a trust claim made subsequent to the trial. The purpose of the bill is to give the defendant a reasonable opportunity to discover relevant trust claim material pertaining to alternate sources for the claimant’s exposure and to the appropriate allocation of responsibility for the claimant’s injury.
These bills strengthen the civil justice reforms enacted in 2003 and 2005 and merit legislative approval. Please contact your state representative and urge him or her to support them.