On Nov. 1, 192nd District Judge Craig Smith of Dallas issued a take-nothing judgment in an oil-patch suit.

Because the plaintiffs lost on their Texas Theft Liability Act claim, Smith ordered them to pay $400,000 in attorneys’ fees to defense lawyer J. Mitchell Little, a partner in the Frisco office of Scheef & Stone. Smith also noted Little may receive another $100,000 in attorneys’ fees if the plaintiffs appeal.

In Quanico LLC, et al. v. Charles Couch, et al., three Oklahoma-based companies and their joint venture sued Charles and Robert Couch, a father and son, and their company Couch Oil & Gas. In their March 4 amended petition, the plaintiffs alleged, among other things, that the defendants violated the Texas Theft Liability Act (Texas Penal Code §§31.03 and 31.05) when they sold a package of oil wells in 2003. The plaintiffs also alleged the defendants violated the Texas Securities Act, by making “material misrepresentations and omissions of fact. . . .”

The defendants denied the allegations in their March 25 answer.

Plaintiffs’ lawyer Dawn Meade, senior counsel at the Spencer Law Firm in Houston, did not return a telephone call seeking comment.

After both sides finished presenting evidence at trial, Little says Smith granted his motion for a directed verdict, ruling against the plaintiffs on their Texas Theft Liability Act claim and others. Only the plaintiffs’ Texas Securities Act claim went to the jury. Jurors deliberated for a day-and-a-half before siding with the plaintiffs on the Texas Securities Act claim, but they awarded no damages, according to the Oct. 5 jury charge.

At trial, according to a transcript, Little told the court that his firm had clocked 1,061 pre-trial hours of billable time on the case at a blended hourly rate of $308 and had incurred even more billables as the trial progressed.

Because of the loser pays provision in the Texas Theft Liability Act, the plaintiffs are responsible for paying his attorneys’ fees, Little says. He believes the plaintiffs “would have been better off” if they had dropped the theft claim from their suit before the trial. [See the verdict and judgment in Quanico LLC, et al. v. Charles Counch, et al.]

The lesson? If a plaintiff files a Texas Theft Liability Act claim, he or she “better be ready to prove it,” Little says.

To suggest a Litigator of the Week,email cmcgushin@alm.com.

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