IN THE SUPREME COURT
12 March 23 P2:22
BLAKE. A. HAWTHORNE
BEFORE THE MULTIDISTRICT LITIGATION PANEL
IN RE STATE FARM LLOYDS
HURRICANE IKE LITIGATION
STATE FARM LLOYDS REPLY TO RESPONSE TO
MOTION TO TRANSFER
Christopher W. Martin Murray Fogler
Texas Bar No. 13057620 State Bar No. 07207300
Kevin G. Cain BECK, REDDEN & SECREST, LLP
Texas Bar No. 24012371 One Houston Center
email@example.com 1221 McKinney, Suite 4500
MARTIN, DISIERE, JEFFERSON & Houston, Texas 770 I 0-20 I 0
WISDOM, L.L.P. (713) 951-6235 - Telephone
808 Travis, 20 TH Floor (713) 951-3720 - Facsimile
Houston, Texas 77002
(713) 632-1700 - Telephone
(713) 222-0 I 0 I - Facsimile
COUNSEL FOR STATE FARM LLOYDS
TABLE OF CONTENTS
A. RESPONDENT'S CLAIM OF ADVANCED DISCOVERY IS SIMPLY
NOT ACCURATE, AND MORE IMPORTANT, NOT RELEVANT .................. 1
B. THE EFFORTS INVESTED BY THE DISTRICT COURTS WILL NOT
BE WASTED IF THE CASES ARE TRANSFERRED ......................................... 5
C. THERE IS IN FACT A CONFLICT IN DISCOVERY RULINGS , BUT
EVEN A MERE POTENTIAL CONFLICT IS SUFFICIENT.. ............................. 6
D. DUPLICATIVE DISCOVERY ALREADY EXISTS ............................................ 9
E. THE CASES ARE RELATED ......................................... , ...... " ............................ 10
F. STATE FARM IS NOT FORUM SHOPPING ..................................................... 1l
G. MANDAMUS PROCEEDINGS DO NOT PREEMPT AND ARE NOT A
SUBSTITUTE FOR AN MDL MOTION TO TRANSFER ................................. 12
H. LOCAL PRETRIAL COURTS CANNOT PROVIDE THE RELIEF THAT
AN MDL PRETRIAL COURT CAN PROVIDE ................................................. 16
1. THE PARTIES AND WITNESSES WILL NOT BE INCONVENIENCED ....... 16
J. THE AUTHORITY RELIED ON BY RESPONDENT IS INAPPOSITE ........... 17
INDEX OF AUTHORITIES
In re Cano Petroleum ,
283 S.W.3d 179 (Tex. M.D.L. Panel 2008) ........................ .... ...... .......... .. .... ............ 3, 12
In re Continen tal A irlines Flight 1404,
MDL No. 09-020 1 (Tex. M.D.L. Panel, May 7, 2009) ........ ...... ...... .... .... .. .... .......... 8, 16
In re Deep S. Crane & Rigging Co. ,
339 S. W.3 d 395 (Tex. M.D.L. Panel 2008) .... .......................... .. ............ .... .............. 8, I 7
In re Ford Motor Co. ,
285 S.W.3d 185 (Tex. M.D.L. Panel 2008) ...... ...... .......................... ......... ..... 3, 6, 16, 17
In re Dcwen Loan Servicing, LLC,
286 S.W.3d 669 (Tex. M.DL Panel 2007) .... .... .......... .. .. .............. ..... ...... .. ....... .. .. .... .... 4
In re Pers. Injury Litig. Against Great Lakes
Dredge & Dock Co., LLC,
283 S.W.3 d 547 (Tex. M.D.L. Panel 2007) .............. .... .. .... .. .. ....... ..... ...... .. .... .. .......... .... 4
In re Petroleum Wholesale Litig. ,
339 S. W.3d 405 (Tex . M.D.L. Panel 2009) ...... ...... .............. .... ......... .. ........... ................ 8
In re Silica Prod. Liab. Litig. ,
166 S.W.3d 3 (Tex . M.D.L. Panel 2004) .................... ........ ... ........ ................... .. 6, II , 17
In re Standard Guar. Ins. ,
339 S. W.3d 398 (Tex. M.D.L. Panel 2009) .. ....... .. ..... .. ....... ..................... .... .... ............ 10
In re State Farm Lloyds,
No. 01-12-00111-CV (Tex. App.- l-Iouston [1 st Dist.]
Feb. 3, 20 12, original proceeding) .......... ... .................................................... .. .. ...... ..... 14
In re State Farm Lloyds,
No. 0 1-1 2-00 16 1-CV (Tex. App.- l-Iouston [I st Dist.]
Feb. 15, 20 12, original proceed ing) ................................................. .. ..... .. ......... ........... 15
In re State Farm Lloyds,
No. I 0- 11 -00768-CV (Tex. App.- l-Iouston [I st Dist.]
Sept. 12,20 11 , original proceeding) .................... ................ ....... .. .... ....... ............. ........ 14
In re Texas City Ref Ultracracker Emission Litig. ,
MDL No. 10-0689 (Tex. M.DL Panel, Oct. 29, 2010) ....... ....... ........ .... ....... .... ... ... .... 16
In re Texas Windstorm Ins. Ass'n,
339 S.W.3d 401 (Tex. M.D.L. Panel 2009) .......... ................ ... ........ ... ............ ....... passi m
In re Toyota Unintended Accelerator Litig. ,
MDL 10-0342 (Tex. M.D .L. Panel 20 10) ....... .......... .... .... ... ..... ... ... ........ .... ....... .... ....... 17
In re Vanderbilt Mortg. & Fin., Inc. ,
166 S.W.3d 12 (Tex. M.D.L. Panel, Mar. 2, 2005) .. ........ ........ .. ..... .. .. ... .... ............... ... 13
Oth er Authoriti es
MANUAL FOR COMPLEX LITIG., Requests for Transfer
§ 3 1.31. 131 (3d Ed. 1995) ........................ ............ ....... ................. ........... ... ... ................ 12
FED. R. CIY. P. 23 ...... .. ... ..... ... ............ ............. ..... .... .... .... .... ...... .. ... ....... ... .... ....... ... .......... II
TEX. R. CIY. P. 42 ....... ........ ...... .... .... ..... ..... ... .... .. ......... .............. ... ............ .... .... ............... II
TEX. R. JUD. ADM IN. 13 .... .... ................. ............ ...... ................ ....... .......... ......... ..... ... passim
TEX. R. JUD. ADMIN. 13.3(h) ................ ...... ........ .... ............. .. ..... .... ... .... ............ ....... ........ 20
TEX. R. JUD. ADMIN . 13.6(b) ....... ..... ... ............... ... ............. .... ... .. .... .. .......... ..... ......... ......... 5
TEX. R. JUD. ADMIN . 13.6(d) .................. .... ...... .. .... ................ ... ......... ... ........ .... ........ ........ .4
REPLY ARGUMENT AND AUTHORITIES
A. RESPONDENT'S CLAIM OF ADVANCED DISCOVERY IS SIMPLY
NOT ACCURATE, AND MORE IMPORTANT, NOT RELEVANT.
Respondent argues that because di scovery in these cases is so far advanced, this Panel
should deny the Motion to Transfer because it would be "a huge waste to see the cases removed
from the trial dockets and placed into an MOL now." Response at 10. However, the discovery
in most cases is in its early stages, and moreover, the stage of discovery does not playa
dispositive role in determining whether a transfer should be granted under Rule 13.
In support of this argument, Respondent argues that over 100 plaintiffs and over
100 adjusters have been deposed. Response at 10. Respondent fails to state that many of
these plaintiff and adjuster depositions were taken in cases that already settled.
In reality, only 83 plaintiffs and 52 adjusters have been deposed in cases that are
still pending and have not settled. Further, there are 266 unresolved cases at issue which
include over 400 individual plaintiffs. In fact, in the 266 cases that are before this Panel,
there are over 334 plaintiffs, 650 adjusters, and 2,240 experts I who have been identified
as subject to deposition discovery, the overwhelming majority of which have not yet been
deposed. Moreover, very few trial inspections of the properties in question have taken
place. Most significantly, Mostyn has shown no sign of slowing down his never ending
quest for institutional discovery from State Farm, and at the time of the MDL filing
dozens of unresolved issues remained regarding corporate witness depositions, corporate
documents, corporate emails, corporate training, corporate positions on coverage issues,
While there are duplicative experts in some of these cases, their depositions are usually taken in each
and many other non-ease-specific issues. In other words, there is much di scovery left to
be taken in these cases .
Although Respondent claims that the plaintiffs have answered State Farm's
discovery (Response at 10), the reality paints a much different picture. For example,
when many of the Mostyn plaintiffs were asked in their deposition s about the amount of
their damages, they were instructed by counsel not to answer. These plaintiffs usually
decline to disclose their damages until their expert reports are provided closer to trial, and
for virtually all of the 266 cases subject to this motion, State Farm has yet to receive thi s
information. Discovery is far from complete.
There is a sound reason why so many of these cases are in the early stages of
discovery. Many of these cases were filed last year, or they were abated until recently.
Of the sixteen counties which are the subject of State Farm's Motion to Transfer, a vast
majority of the counties abated l!ll the State FarmlHurricane Ike cases so the parties could
mediate. See e.g., Stand ing Pretrial Orders in Harris, Ga lveston, Jefferson, and Brazoria
Counties (which require parties to agree to a mediator and mediation date with in 100 or
120 days after defendant makes an appearance). With the exception of two counties
(Harris and Ga lveston), very litt le di scovery has begun. Most of these cases (before the
Panel ' s stay) were just entering into discovery. In fact, the response filed with this Panel
by Theresa Moor indicates that no di scovery has been served other than requests for
disclosure. Moor Response at I. Likewise, the Fassinos' response states that no
discovery and no mediation has been conducted in that case. Fassi nos Response at 4.
Margaret Mitchell states in her response that her case has been stayed by the trial court
"for over 95 per cent [sic] of the time it has been on the docket." Mitchell Response at 8.
These cases illustrate that discovery in most of these cases is not anywhere near
complete. The discovery disputes and inconsistent rulings documented in State Farm ' s
Motion to Transfer and Motion for Stay are just the beginning. Much more discovery
will follow , and likewise, many more di scovery disputes and inconsistent/conflicting
orders will likely result.
Similarly, Respondents complain that an "MDL court" should not be appointed
because it has been almost four years since Hurricane Ike, and all the cases in Galveston
County are set for trial by May 2012 2 Response at 1-2, 10. This Panel has previously
rejected this argument in other cases, noting that the "appointment of a pretrial judge has
no direct effect on existing settings." In re Cano Petroleum , 283 S.W.3d 179, 182 (Tex.
M.D.L. Panel 2008); In re Ford Motor Co., 285 S.W.3d 185, 190 (Tex. M.D.L. Panel
2008). In fact , this Panel transferred 77 cases in February 2008 when there were cases set
for trial in January, March, April, and May 2008. In re Ford Motor Co., 285 S.W.3d at
187. The appointment of a pretrial judge "does not necessarily cause delay; it simply
puts a different judge in place to make deci sions about pretrial matters." In re Cano
Petroleum, 283 S.W.3d at 182. This Panel previously rejected the " impending trial date"
argument by noting that "we are confident that the pretrial judge will be mindful of the
status of the cases transferred and promptly remand to the trial court any case that is
indeed ready for trial." In re Ocwen Loan Servicing, LLC, 286 S.W.3d 669, 673 (Tex.
Similarly, Respondent argues that " [a]1I the currentl y pending cases involving State Farm ... are on a
fast track for trial." Response at 10. This is simply not correct. Although a few cases have been set
for trial, the majority of the remaining State Farm cases have not yet been set for trial.
M.D.L. Panel 2007). In other words , because a case is nearing tri al in a few months does
not mean it should not be transferred pursuant to Rule 13. 3
This Panel previously addressed the argument that a transfer shou ld not be granted
because the discovery in some of the cases is substantially complete. In re Texas
Windstorm Ins. Ass 'n , 339 S.W.3d 40 1, 404 (Tex. M.D.L. Panel 2009). Thi s Panel
responded to that argument with the following reasoned analys is :
This argu ment rests on the assumpti on th at completion of discovery and the
existence of a trial setting will immuni ze a case from MDL procedures. That
assumption is erroneous because Rul e 13 contemplates that the pretri al judge
w ill be invo lved in the details of trial setti ngs. When discovery is compl ete
and an MDL case is ready for trial , Rule 13 does not allow the pretrial judge to
simply return the case to the trial court without consultation or further
instructions. On th e contrary, when remanding a case the pretri al judge is
instructed to: (I) consult with the trial judge about the trial setting, (2) consider
the conven ience of th e parties and witnesses in the remanded case, and (3)
consider the efficient handling of the cases remaining in the MDL proceeding.
See TEX. R. JUD. ADMIN. RULE 13 .6(d).
Id. at 404-05. According ly, the fact that discovery has begun or is even near compl etion
in very few of these cases does not prevent this Panel from properl y transferring related
cases to a si ngle pretrial court.
Respondent quotes from In re Personal II/jUly Litigation wh ich holds that "imminent trial settings
further inform our belief that any benefit ... from a Rule 13 transfer is outweighed by the procedural
posture of these cases and their progress." Response at 9- 1 (quoting In re Pers. InjlllJI Lilig. Against
Great Lakes Dredge & Dock Co., LLC, 283 S.W.3d 547, 548 (Tex. M.D.L. Panel 2007)). However,
that case is distinguishable because of the twenty cases that were the subj ect of that case, "extensive
discove.y has been completed and many cases are set for trial." In re Pers. InjlllY, 283 S.W.3d at
548. Here, however, most cases are in the earl y stages of discovery, and only a handful have
" imminent trial settings. "
B. THE EFFORTS INVESTED BY THE DISTRJCT COURTS WILL NOT
BE WASTED IF THE CASES ARE TRANSFERRED.
Respondent argues this Panel should not transfer these cases because time and
energy has already been spent by the trial courts in making pretrial rulings, addressing
significant discovery questions, and developing some knowledge. Response at 9.
Respondent goes on to argue that these efforts will have been wasted if the MDL motion
is granted. There are multiple problems with this argument.
First, the premise that these cases are at a " late date," implying nearly complete
discovery, is incorrect (as addressed above). Second, thi s argument would theoretically
preclude a transfer of any case where any level of judicial effort has been expended.
Third, any prior work would not be " lost. " For instance, all prior rulings will stand
unless challenged and reversed, as would be true in every case that is transferred,
removed, or consolidated. Likewise, a judge wi ll not have to "reexamine issues that have
been decided" unless they are raised again by the parties before the new pretrial judge.
While the applicable rules allow the pretrial court to "set aside or modify any pretrial
ruling made by the trial court before transfer," no prior rulings are automatically " lost"
just because cases are transferred. See TEX. R. JUD. ADMIN. 13.6(b).
Respondent similarly argues that a transfer is not warranted because the pretrial
courts are doing an "efficient" job in handling all pretrial matters. Response at I, 4-5, 18-
19. The mere fact that some cases are purportedly being addressed by existing courts has
no relevance to the determination of whether a transfer is proper under Rule 13. In fact,
such an argument has been repeatedly rejected by this Panel. [n re Ford Motor Co., 285
S. W.3d at 191. Rule 13 "does not requIre proof that witnesses have already been
inconvenienced; it looks ahead and focuses on whether transferring cases to a pretrial
judge would serve the convenience of the parties and witnesses by preventing
inconveniences in the future. " In re Silica Prod. Liab. Lilig. , 166 S.W.3d 3, 5-6 (Tex.
M.D.L. Panel 2004) ("But even if these cases are currently moving smoothly because the
lawyers have been agreeing on pretrial issues, we see no reason why such agreeableness
would cease when the pretrial phase of the cases is handled by one judge instead of fifty-
five. "). A transfer here will consolidate discovery and ensure that conflicting and
inconsistent rulings are a thing of the past. As such, Respondent's argument fails.
C. THERE IS IN FACT A CONFLICT IN DISCOVERY RULINGS , BUT
EVEN A MERE POTENTIAL CONFLICT IS SUFFICIENT.
Respondents incorrectly argue that there is no "conflicting order" between any of
the trial courts. Response at 16-18. This argument is incorrect, but in any event, it is
insufficient because the potential for conflicting rulings is adequate to warrant transfer.
First, the contention there are no conflicting orders is not accurate. For example,
the Mostyn Law Firm previously filed a motion to compel with Harris County Judge
Miller seeking an order compelling State Farm to produce e-mails relating to its Single
Point of Contact meetings (" SPOC meetings,,).4 Judge Mike Miller denied this request
noting that producing all those e-mails would be "difficult ... to retrieve" and the efforts
were not justified because of the minimal relevance of these documents, given that the
See Exhibit 3 attached to State Farm ' s Motion for Leave filed on February 24 , 2012 .
actual minutes had already been produced 5 The Mostyn Firm then raised the same issue
with the Galveston County District Court to secure a ruling that emails and
correspondence relating to SPOC meeting minutes must be produced. Respondents
incorrectly argue that one order precluding the production of emai Is relating to SPOC
meetings does not conflict with another order compelling the production of emails
relating to SPOC meetings. This is plainly a different ruling on the same subj ect (as well
as blatant forum shopping).
Respondents try to avoid thi s defect in their argument by speculating that Judge
Miller would have ruled differentl y had he been presented with the information that was
presented to Judge Criss. 6 Response at 17-18. Respondent tries to make thi s point by
misconstruing the facts and testimony of Marvin Cummings. 7 This hi ghlights the second
defect with Respondent's argument-State Farm is not required to show an existing
conflict in orders (although such a conflict already exists). Rather, State Farm must only
show the potential for a conflict in orders among the trial courts.
The speculation about what Judge Miller might have done is ironic because Plaintiffs ' counse l chose
not to go back to Judge Miller at all on this issue, but instead went to a different county! Moreover,
the motion filed in Galveston on this issue says nothing of the alleged Cummings ' testimony, and
there was no sworn testimony fro m Marvin Cumm ings introduced at the hearing when that court
compelled the production of ema ils relat ing to the SPOC minutes.
Respondent argues that Mr. Cummings testified that the SPOC notes were what one person "heard"
but not what was said during SPOC meet ings. Response at 18. Mr. Cummings never testified that
the notes did not reflect what was sa id during these meetings. In fact, Mr. Cummings testified
referring to the SPOC meeting notes that "none of thi s appears inaccurate to me." Regardless, the
discovery o rders remain completely inconsistent.
In holding that a motion to transfer should be granted, the Panel has previously
agreed that the potential for inconsistent rulings is sufficient. In re Petroleum Wholesale
Litigation , 339 S.W.3d 405 , 409 (Tex. M.O.L. Panel 2009). Factors to be considered by
the MDL Panel include duplicative discovery and depositions, and "potentially
conflicting orders." In re Deep South Crane & Rigging Company, 339 S.W.3d 395396-
97 (Tex . M .O.L. Panel 2008). "A moving party need not establish an existing problem
that requires correction ." In re Continental Airlines Flight 1404, MOL No. 09-0201 at 7
(Tex. M.O.L. Panel , May 7, 2009) . Simp ly put, the potential for inconsistent rulings on
discovery issues is sufficient to grant a motion to transfer. With the depositions of
thousands of fact and expert witnesses yet to be taken, with potentially millions of pages
of additional corporate records yet to be addressed for rel evance, burdensomeness,
breadth, and privilege and with potentially hundreds of additiona l pretrial hearings yet to
be heard before all of the State Farm cases are tried , the potential for inconsistent rulings
are so great as to be an inevitability given the size of the litigation, the number of courts
across 16 counties, and the number of different litigants and lawyers. Regardless, State
Farm has demonstrated both conflicting orders and the potential for conflicting orders.
Unless transfer is granted, any party dissatisfied with one court ' s ruling on an
issue is free to try any of the 15 other counties where these cases are pending. And when
that fai ls, try another county. And another until they tire or succeed . To argue that there
is no potential for conflicting or duplicative rulings among S6 different courts is absurd.
D. DUPLICATIVE DISCOVERY ALREADY EXISTS.
Respondent argues that there is no duplicative discovery in these 266 different
cases, and that such duplication will not and cannot take place. Response at 6-8 . Not
only is it possible for such duplication to take place in discovery, it has already taken
Respondent repeatedly makes assurances that duplicative or inconsistent rulings
and discovery are not possible because the "adoption of master discovery and coordinated
efforts of the pretrial courts will eliminate any such possibility." Response at 7.
However, Respondent's version of "coordinated" discovery can best be summarized with
a statement from the bench in a Galveston County hearing on May 27, 2011:
I mean, I know that Judge Miller made some changes. I know that Judge
Wortham made some changes, and I don't care. I just don't care if they do.
I just care what we do here. We started here. We started here, so I really am
not -- I'm really not the least bit worried about issuing an order that
contradicts someone in some other county.
The potential for duplicative discovery and inconsistent rulings is very real.
Respondent relies largely on the "coordinated" efforts of the pretrial courts In
support of the theory that there will be no duplicative discovery under the current system.
Response at 6-8 . There are only five counties with a pretrial court handling all Hurricane
Ike cases. Response at 3-4. Respondent offers no explanation how courts in the eleven
other counties can insure that discovery will not be redundant.
The Mostyn plaintiffs have already initiated duplicative discovery. For example,
they have served the same institutional discovery including over 90 burdensome Requests
for Production in Jefferson, Hardin, Galveston, Fort Bend and other counties. Moreover,
plainti ffs have sought the same exceptionally broad institutional discovery in the form of
notices of deposition for corporate representatives on the same 34 subjects in multiple
cases in Brazoria and Ga lveston Counties. Plaintiffs requested the corporate
representative deposition of Marvin Cummings in multiple different cases after his
deposition as a corporate representative had already been taken in another case. Simply
put, the unsupported statement that there is no duplicative discovery or threat of such is
simpl y not true.
E. THE CASES ARE RELATED.
Respondent ' s argument that State Farm has failed to allege common issues of fact
to satisty the standard for transfer to an MDL court pursuant to Rule 13 is inaccurate.
State Farm's Motion to Tra nsfer argues that the cases "involve common questions of fact
because they are all governed by virtually the same policy of insurance issued by State
Farm and make the sa me allegations of liab ility against State Farm stemming from
damages purportedly caused by Hurricane Ike." Motion at 2. This Panel previously
accepted this argument. In re Standard Guar. Ins. , 339 S.W.3d 398, 399 (Tex. M.D.L.
Panel 2009) ("the cases in its motion are related because they are nearly identical
insurance coverage disputes, with each case involving the same insurance carrier and
arising from property damage sustained during Hurricane Rita.").
Respondent further argues that the cases cannot be related due to di fferi ng
liability, causation, and damages. Response at 11. This panel expressly rejected that
argument in the Hurricane Rita litigation in finding that such circumstances did not
preclude transfer. In re Texas Windstorm , 339 S.W.3d at 403.
Respondent disagrees that the cases are related because the same extra-contractual
issues are rai sed in every petition. Response at 11. This panel has held throughout the
Hurricane Rita litigation that cases are "related within the meaning of Rule 13 because
the insurers faced substantially the sa me extra-contractual claims and discovery requests
in every case." In re Texas Windstorm, 339 S.W .3d at 402. Plaintiff cites In re Ad
Valorem Tax Litig. for the idea that the cases are not related under Rule 13 because of the
local nature of the disputes. Response at 12. The Panel likewise rejected this argument
in In Re Texas Windstorm. 339 S.W.3d at 404. This Panel has frequently held that
transfer is proper "even though in a given case the common issues might not outweigh
the individual case-specific issues." In re Silica Products, 166 S.W .3 d at 6. State Farm
has shown that there are common issues, but Rule 13 does not require that case specific
issues must outweigh the common ones. 8
F. STATE FARM IS NOT FORUM SHOPPING.
The first sentence of Respondent 's Response states, "No case has ever taken thi s
long to come before the Multidistrict Litigation Panel." Response at I . This statement is
made to support Respondent's false allegation that State Farm is forum shopping. Yet,
this case took only four months longer to file a motion to transfer than occurred in In Re
Texas Windstorm Association Hurricanes Rita and Humberto Litigation.
T he individualized facts and circu mstances of these individual cases, including State Farm's claims
handling with each policyholder, differ to valyi ng degrees. Accordingly, while these cases are
undoubtedly appropriate for coord inated treatment to promote the efficient resolution of th is litigation
and to minim ize the potentia l for inconsistent pretrial rulings, State Fann disputes any contenti on that
these cases are maintainable as class actions under FED. R. Civ. P. 23 or TEX. R. eiV . P. 42, and
nothing in this motion should be interpreted as an ind ication to the contrary or as an admissio n on
State Farm's part that commonality or any criteria under FED. R. eiV. P. 23 or TEX . R. elv . P. 42 has
This Panel has rejected similar arguments that require " inquiry into a movant' s
subjective state of mind." In re Cano Petroleum, 283 S.W.3d at 182. Under
Respondent's logic, ever), Rule 13 movant would be guilty of forum shopping because
they are trying to take cases out of one county and potentially place them into another.
Such skewed logic would mandate a repeal of Rule 13.
The primary support for Respondent's "forum shopping argument" is a quote from
a Manual for Complex Litigation (relating to federal MDL). Response at 2. However,
Respondent omits critical distinguishing language within this quote:
Sometimes, however, the justification for transfer may not arise until later
in the proceedings, either because additional cases have been filed
unexpectedly or because efforts to achieve voluntary coordination have
proved ineffective in reducing conflicts and duplication .
MA NUAL FOR COMPLEX LITIG. , Requests for Transfer § 31.31.13 I at 252 (3d Ed. 1995)
(emphasis added). The duplication of discovery in 16 different counties as well as the
real and potential conflicting discovery orders are the sole impetus behind State Farm's
Motion to Transfer.
G. MANDAMUS PROCEEDINGS DO NOT PREEMPT AND ARE NOT A
SUBSTITUTE FOR AN MDL MOTION TO TRANSFER.
Respondent argues that a transfer is not warranted because discovery disputes are
being "adequately" handled in mandamus proceedings. Response at 1, 13 , 14, 17. Such
adequacy is in the eye of the beholder.
No court or MDL Panel has ever held that other relief (like a mandamus
proceeding) should impact whether a transfer under Rule 13 would be proper. Moreover,
Respondents ' apparent solution is to require the mandamus of each discovery dispute
separately! State Farm ' s Moti on to Transfer involves 266 cases fro m 56 courts in 16
counties; consequentl y, thi s cou ld generate numerous, multipl e mandamus proceedings
on the same di scovery di spute. In add ition to bei ng gross ly inefficient and a tremend ous
burden on the courts of appeal, such a solution would be eco nomi cally crippling given
the great cost of even one mandamus, not to mention multi ple dozens, or even hundreds.
In contrast, State Farm ' s solution wou ld be fo r the MDL Panel to transfer all these cases
to one pretrial court so that one hearing on a discovery issue will produce one ruling and
resol ve that issue for all State Farm cases. That alone w ill " promote the j ust and efficient
conduct of the cases. " See id. Regardless, mandamus is an extraordinary remedy
focused on a single issue, and is not intended to provide a manner of coordinating
discovery in hundreds of cases.
State Farm was clear in its Moti on to Trans fer why all the di scovery issues were
menti oned and brought to the Panel's attention:
It would be far more effi cient fo r everyone invo lved to have consistent
rulings and would greatly reduce the number of di scovery disputes and
numerous hearings. "A consistent and steady judicia l hand at the helm
should in fac t promote agreements because lawyers w ill know where the
court stands on recurrin g issues." In re Vanderbilt Mortgage & Finance,
Inc. , 166 S. W. 3d 12, 12 (Tex. M. D.L. Panel Mar. 2, 2005 ). Consistent
rulings w ill also all ow the attorneys to better evaluate th eir cases, which in
turn would promote sett lement.
Due to the multi fa ri ous wri tten di scovery requests and rulings on sa me,
State Farm has been subjected to confli cting standards of rev iew.
Moti on to Transfer at 9, 10. Sim ply put, all the di scovery issues were brought to the
attention of the Panel to demonstrate the rea lity and potenti ality for inconsistent
discovery rulings and the need for greater efficiency that a single pretri al court would
offer. The existence of discovery orders demonstrating inconsistent relief (or potential
inconsistencies between trial courts) is relevant to the Motion to Transfer.
There have been three prior mandamus proceedings involving State Farm arising
out of the Hurricane Ike cases in Galveston County. They illustrate discovery disputes
that are inconsistent and potentially inconsistent with rulings from other trial courts.
First Mandamus Proceeding
• In re State Farm Lloyds, No. I 0-11-00768-CV (Tex. App.- Houston [I st Dist.]
Sept. 12, 2011 , original proceeding).
• Issue: In a specific case called Jordan , the trial court ordered State Farm to
produce two witnesses from State Farm to testify about how State Farm worked
with counsel to respond to di scovery requests, violating the work product
• Appellate Court granted emergency relief staying the trial court' s order.
• When a settlement in principle was reached in the Jordan case, State Farm filed on
11123/11 a motion to abate to allow the parties to finalize their settlement.
The next two mandamus proceedings mu st be put in context. After Judge Miller
ruled in Harris County that Plaintiffs' counsel (Steve Mostyn) was not entitled to emails
concerning the SPOC meeting minutes, Mostyn sought similar discovery in Galveston
County. The Galveston court ordered production of (I) the emails of Marvin Cummings
relating to the SPOC meetings (and other topics) , and (2) the emails of 92 other State
Farm employees on the sole issue of SPOC meetings.
Second Mandamus Proceeding
• In re Slate Farm Lloyds, No. 01-12-00 III-CV (Tex. App.- Houston [I st Dist.]
Feb. 3, 2012, original proceeding).
• Issue: The trial court ordered State Farm to produce to the trial court, with less
than 17 hours ' notice, 66,000 documents (approximately 600,000 pages) resulting
from a word search in Marvin Cummings ' emails of 70 terms. The search term s
included the term " SPOc."
• The First Court of Appeals granted State Farm's motion for emergency relief
staying the trial court' s order.
• State Farm subsequently filed a motion to dismiss the petItIOn for writ of
mandamus after the Galveston court extended the deadline to produce the
documents, making the mandamus issue moot. 9
Third Mandamus Proceeding
• In re Slale Farm Lloyds, No. 01-12-00l61-CV (Tex. App.-Houston [1st Dist.]
Feb. 15, 2012, original proceeding).
• Issue: The trial court ordered State Farm to produce to opposing counsel by
February 24, 2012 communications from 92 State Farm employees regarding
SPOC meeting minutes, requiring State Farm to review approximately 3.7 million
• First Court of Appeals set deadline for Plaintiff to file response to petition for writ
of mandamus on February 21 , 2012. State Farm consented to both Plaintiffs
motions to extend Plaintiffs ' mandamus filing deadline, and the First Court of
Appeals extended deadline for Plainti ff. The response was filed on March 20,
• Trial Court extended the deadline to produce until March 31 , 2012.
• This mandamus proceeding is still pending.
These mandamus proceedings illustrate that inconsistent rulings have already occurred
(conflicting with Judge Miller in Harris County), and such rulings are the subject of
Moreover, these mandamus proceedings illustrate another important component of
State Farm's Motion to Transfer. When Plaintiffs' counsel could not get the SPOC
meeting minutes in Harris County, they simply went to another county until they got the
documents they wanted (the same documents Judge Miller in Harris County said they
were not entitled to receive). This is the only forum shopping which has occurred to date
The fact the Galveston court relented and gave State Fann more than 17 hours to produce 600,000
pages of documents making the " imposs ibility" arguments in State Farm 's mandamus moot, the fact
Sate Farm had to do so in one court while it was expressly told it did not have to do that in another
court of another county proves both the existing conflict of orders between the courts and the
potential for many more.
and, unfortunately, it will continue endlessly until Plaintiffs tire of trying or find a court
in one of the 16 counties to give them what they want. However, that practice will be
properly thwarted under one pretrial court appointed by the MDL Panel.
H. LOCAL PRETRIAL COURTS CANNOT PROVIDE THE RELIEF THAT
AN MDL PRETRIAL COURT CAN PROVIDE.
Respondent argues that there are pretrial courts 111 variOUS counties where
discovery has been consolidated, which will remedy the concerns addressed in State
Farm ' s Motion to Transfer. Response at 3-5. This Panel has previously rejected this
argument in other cases because pretrial courts having only county-wide authority do not
go far enough in giving a pretrial court the authority it needs to make the litigation more
efficient. See In re Continental Airlines Flight 1404, MDL No. 09-0201 at 4 ("Rule 13
provides remedies that [a local rule on consolidated discovery] does not."); In re Texas
City RejinelY Ultracracker Emission Litigation, MDL No. 10-0689 (Tex. M.D.L. Panel,
Oct. 29, 20 I 0) (holding that the MDL pretrial court's "pretrial rulings will be binding
when the case is remanded for trial."). This argument has been previously briefed in
State Farm's Motion to Transfer at 16-17.
1. THE PARTIES AND WITNESSES WILL NOT BE INCONVENIENCED.
Respondent argues that the cases should not be transferred because it will be
inconvenient for parties and witnesses to litigate in a distant county. Response at 19-20.
This argument is without merit. The cases will ultimately be remanded for trial in the
county of origin, and witnesses will be deposed in the county where they reside. In re
Texas Windstorm , 339 S.W.3 d at 404-05 ; In re Ford Motor Co., 285 S.W.3d at 188.
For example, th is Panel granted Ford' s motion to transfer under Rule 13. In re
Ford Motor Co., 285 S.W.3d at 192. Even though that proceeding involved cases from
28 different counties all over Texas, the Panel still concluded that it would be "more
convenient for witnesses and parties .. . to litigate in one pretrial court instead of
several." Jd. at 19 1-92 (quoting In re Silica, 166 S.W.3d at 6) ; see also In re Deep South
Crane & Rigging Co. , 339 S.W.3d at 397 . " We note that parties and witnesses rarely
need to attend pretrial hearings in person, and lawyers who are not located near the
pretrial court may be allowed, upon request, to participate by te lephone or other
electronic means." In re Toyota Unintended Accelerator Lilig. . MDL 10-0342 (Tex.
M.D.L. Panel 20 I 0). Likewise, it will be more convenient here fo r parties and witnesses
from on ly 16 neighboring counties to litigate in one pretrial court.
1. THE AUTHORITY RELIED ON BY RESPONDENT IS INAPPOSITE.
Noticeab ly absent in all seven of the MDL Panel opinions cited by Respondent
was a case involving a single disaster, like a hurricane case. Respondent cites to cases
involving taxes, predatory lending practices, and personal injury litigation, but not to a
single natural hurricane MDL opinion. The reason is obvious- the opinions address ing
MDL treatment of large numbers of catastrophe-based cases provide the roadmap to
granting State Farm's Motion to Transfer.
For example, while many such options could be cited, the Texas Windstorm case
illustrates this point. That case involved a motion to transfer 38 Rita cases and 4
Humberto cases. In re Texas Windstorm , 339 S.W.3d at 401. After this Panel rejected
the argument that the cases were not related because of different storms or different types
of policies (residential v. commercial), the court held that the cases were related because:
[E)ach case arises from [I) hurricane damage, [2) involves the same
insurance coverage, and [3) involves the same or similar extra-contractual
claims and discovery discussed above.
ld. at 403. The same is true here.
The lawsuits against State Farm all arise from Hurricane Ike damage, involve
virtually the same insurance coverage from State Farm, and the same or similar extra-
contractual claims. This Panel has held that cases were "related" under Rule 13
"[b )ecause of the extra-contractual claims, even though some of them involve a
different policy and a later hurricane in the same area." ld. Likewise, the Ike cases
against State Farm should also be transferred into a single pretrial court.
For these reasons, State Farm requests that the Panel grant the Motion to Transfer
all cases listed in the Amended Appendix attached to State Farm's Motion for Leave to
Amend Appendix Attached to Motion to Transfer.
Respectfully subm itted,
By: /s/ Christopher W. Martin
Christopher W. Martin
Texas Bar No. 13057620
Kevin G. Cain
Texas Bar No. 24012371
MARTIN , DISIERE, J EFFERSON & WISDOM , L.L.P.
808 Travis, 20 th Floor
Houston, Texas 77002
(713) 632-1700 - Telephone
(713) 222-0101 - Facsimile
State Bar No. 07207300
BECK, REDDEN & SECREST, LLP
One Houston Center
1221 McKinney, Suite 4500
Houston, Texas 77010-2010
(713) 951-6235 - Telephone
(713) 951-3720 - Facsimile
ATTORNEYS FOR STATE FARM LLOYDS
CERTIFICATE OF SERVICE
I hereby certify that on thi s 23rd day of March, 2012, a true and correct copy of
the foregoing instrument was sent via e-mai l and certified mail, return receipt requested,
to the following the following counsel:
1. Steve Mostyn Hon. Ann McClure
The Mostyn Law Firm Justice, Eighth Court of Appeals
38 10 West Alabama Street 500 East San Antonio, Room 1203
Houston, TX 77027 EI Paso, Texas 7990 I
Counsel o/record who is designated under
Rule 13.3(h) to serve documents on parties
who are not aligned with State Farm
Richard P. Hogan, J1'. Hon. Carolyn Wright
Jennifer Bruch Hogan Justice, Fifth Court of Appeals
Matthew E. Coveler George L. Allen, S1'. Courts Bldg.
Hogan & I-logan 600 Commerce Street, 2 nd Floor
2 Houston Center Dallas, Texas 75202-4658
909 Fannin, Suite 2700
Houston, Texas 770 I 0
MDL Panel Members: (via US Mail) Hon. Catherine Stone
Hon . David Peeples Justice, Fourth Court of Appea ls
Fourth Administrative Judicial Region 300 Do lorosa, Suite 3200
Bexar County Courthouse San Antonio, Texas 78205
100 Dolorosa, 5'h Floor
San Antonio, Texas 78205
Hon. Jeff Brown
Justice, Fourteenth Court of Appeals
30 I Fannin, Room 245
Houston, Texas 77002
lsi Christophel' W Martin
Christopher W. Martin