Austin Texas Blogspot reports this multi-state, multi-court personal injury – bakruptcy – legal malpractice case arising from an auto accident. Texas, California, personal jurisdiction, the place of the wrong. All are mixed in this swirl. Eric Red v. John Doherty and Doherty & Catlow, A Law Corporation,
No. 03-06-00478-CV (Tex.App.- Austin, Jul. 20, 2007)(Opinion by Justice Waldrop
"In May 2000 in Los Angeles, California, Red drove his vehicle into a crowded bar, killing two individuals. Family members of those two individuals filed wrongful death claims against Red in California state court, and John Doherty of the California law firm Doherty & Catlow was hired to defend Red against those claims under a $30,000 automobile insurance policy issued by Mercury Insurance Group.
After the wrongful death claims were filed against Red, he briefly moved to Austin, Texas, where he filed for bankruptcy protection. He sought and received a stay of the California state court wrongful death lawsuit. Red retained Austin attorney Steven Hake to represent him in the bankruptcy. Red sought to discharge all of his debts, including any contingent liability to the wrongful death claimants, but the wrongful death claimants filed an adversary proceeding in the bankruptcy objecting to the discharge of their claims. On the advice of Hake, Red hired another Texas attorney, Stephen Sather, to represent him in the adversary proceeding in the bankruptcy. After a trial, the bankruptcy court determined that the wrongful death claims qualified as exceptions to discharge under 11 U.S.C. § 523(a)(6) because the collision was the result of Red’s willful and malicious conduct. The district court affirmed the bankruptcy court’s decision on similar grounds, and the Fifth Circuit Court of Appeals affirmed that decision. See In re Red, 96 F. App’x. 229, 230 (5th Cir. 2004).
After the Texas bankruptcy court rendered its decision, the California state court in which the wrongful death claims were pending ruled that the Texas court’s decision was res judicata as to Red’s liability for the wrongful death claims. The court directed a verdict in favor of the claimants on the issue of liability, and the issue of damages was tried to a jury, which returned a verdict awarding slightly over $1,000,000 to the plaintiffs. That judgment was affirmed on appeal. See Roos v. Red, 130 Cal. App. 4th 870, 874 (Cal. Ct. App. 2005), cert. denied, 546 U.S. 1174 (2006).
In May 2006, Red sued Sather in Texas state court for legal malpractice in connection with the adversary proceeding in the Texas bankruptcy. He later amended his petition to add as defendants John Doherty, the law firm Doherty & Catlow, Mercury Insurance Group, and an employee of Mercury Insurance Group. Against these defendants, Red asserted claims for breach of contract, civil conspiracy, fraud, breach of fiduciary duty and the duty of good faith and fair dealing, negligent misrepresentation, legal malpractice, and DTPA violations.
Appellees John Doherty and Doherty & Catlow filed a special appearance arguing that the Texas court did not have personal jurisdiction over them. After an evidentiary hearing, the trial court granted appellees’ special appearance and dismissed Red’s claims against them. The court issued findings of fact and conclusions of law. This appeal followed