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Litigators Jostle for Lead Roles in Harvey Dam Flooding Suits

Law.com, October 31, 2017

By: Brenda Sapino Jeffreys

Lawyers from 25 firms, most of which based in Texas, will pack a Houston courtroom on Nov. 1 as they vie to lead involuntary condemnation litigation filed on behalf of individuals and businesses dealing with the aftermath of flooding that occurred after water was released from two reservoirs during Hurricane Harvey.

The plaintiffs firms have filed suits on behalf of clients who live in Houston neighborhoods that flooded when the U.S. Army Corps of Engineers authorized controlled water releases from two reservoirs in the wake of the late August storm. The suits, some seeking class action certification, allege that the intentional flooding was an unlawful government taking of property, violating the Fifth Amendment to the U.S. Constitution.

The litigation has brought out the Houston plaintiffs bar in full force.

“It’s not surprising, particularly when this is a Houston event. All of us got calls from friends and clients, or had family members who were affected by it,” said Fred Hagans, a name partner at Houston’s Hagans Montgomery & Rustay, who has filed a statement of interest to be considered as class counsel or lead class counsel.

Tony Buzbee, a former U.S. Marine and high-powered founder of Houston’s Buzbee Law Firm, is seeking to serve on a plaintiffs’ steering committee for individual claimants with property located downstream of the reservoirs.

“You pretty much have, at least for the state of Texas with a couple of exceptions, the best lawyers in our state trying to be involved in these cases. It shows viability,” Buzbee said. As of last week, Buzbee said he had filed 67 percent of all of the Harvey-related takings complaints in the U.S. Court of Federal Claims, and expects to file hundreds more.

Other Houston plaintiffs lawyers are wondering why so many firms have waded into the litigation, considering the legal theory is very narrow and complicated and not necessarily in all firms’ wheelhouses.

“The attractiveness of the litigation has generated literally just hundreds of lawyers wanting to get into the litigation,” said Tommy Fibich, a name partner at Houston’s Fibich, Leebron, Copeland & Briggs. “I worry about the experience of some people seeking a leadership position. You have some really great lawyers but they don’t have experience in condemnation.”

Fibich’s firm is part of a group that includes The Lanier Law Firm and Johns Marrs Ellis & Hodge, both of Houston, as well as Arent Fox and Marzulla Law of Washington, D.C.

At least seven groups of firms have filed statements of interest seeking a leadership role in the litigation, either in a potential class action, or in individual suits. Chief Judge Susan Braden of the U.S. Court of Federal Claims, with assistance from Chief Judge Lee Rosenthal of the U.S. District Court for the Southern District of Texas, will hold a hearing on Nov. 1. for lawyers in the groups seeking roles as class counsel in a putative class action, or as a leader of individual suits if they are consolidated.

Fibich said he expects the judges to consider class actions for property owners located  upstream or downstream of the reservoirs. If Braden certifies a class or two, Fibich expects the class litigation to involve only liability.

“The damages are too unique to each individual,” he said. “You’ve got different values of houses, different damages to houses, different insurance, different mortgages.”

Despite the number of lawyers expected to pack the court for a hearing that Braden has said will conclude by mid-afternoon because of her travel schedule, Richard Mithoff of Houston’s Mithoff Law Firm said that he expects lawyers from each group to have the opportunity to speak. (Mithoff is in a group with Fibich.)

According to an Oct. 11 order from Braden, 46 complaints were filed in the Court of Federal Claims between Sept. 5 and Oct. 5 alleging takings clause claims in violation of the Fifth Amendment, with 10 of those complaints filed as putative class actions.

In an email to lawyers involved in the litigation, Braden said she will issue an order of appointment of class counsel at the same time as a decision on class certification, but that will not happen before January. She wrote that she also will issue at the same time an order regarding lead counsel for the suits filed by individuals or groups of plaintiffs.

Buzbee, the tank-buying Houston trial lawyer, expects Braden to pick and choose among the many firms seeking leadership roles in the litigation.

Fees will be another issue that Braden will address eventually. In most cases, the plaintiffs have hired the lawyers under contingency fee contracts. But one group, which includes Texas firms Coats Rose and Slack & Davis, wrote in its statement of interest that it will disclaim any contingency fees and seeks to be paid for successful recovery on behalf of their clients on a “reasonable lodestar basis.”

Jay Edelson of Chicago-based Edelson PC, filed the statement on behalf of the group, which is seeking to be appointed lead counsel for the downstream class. Edelson said it is their view that there is a statutory avenue for attorneys to be paid via a lodestar.

“The whole point under the principles of eminent domain is the government has an interest to make sure property owners are made whole, which is why we say we are going to have fee shifting and that’s how we get paid,” Edelson said.

On behalf of the Army Corps of Engineers, the U.S. Department of Justice declined comment on the litigation. However, in an Oct. 30 response to plaintiff’s statements on case management and designation of class and lead counsel, the Justice Department has taken the position that the court should appoint class or lead counsel prior to motions for class certification.

The federal government, which opposes certification of a class, suggests that a judge should not appoint “unwieldy” multi-lawyer teams acting as lead or class counsel.