Put blog today features the following detailed analysis of Pohl v. Cheatham (Supreme Court of Texas, May 9, 2025). The opinion, with dissent, can be read by clicking here.
Case Background
- Parties: Michael A. Pohl and Robert Ammons (Texas attorneys) were sued by out-of-state clients (the Cheathams from Louisiana and Reese from Arkansas) who were represented by them in personal injury cases outside Texas.
- Allegations: After tragic car accidents, the clients were allegedly approached at their homes (in Louisiana and Arkansas) by "case runners" who encouraged them to hire Helping Hands Group and, ultimately, Pohl and Ammons. The clients claimed they received money or promises of money as inducement to hire the lawyers.
- Key Statute: Texas Government Code Section 82.0651 creates a civil remedy for clients to void legal services contracts procured through "barratry" (illegal solicitation), as defined by Texas Penal Code and disciplinary rules.
Legal Issue
Does Section 82.0651(a) allow lawsuits against Texas lawyers by out-of-state clients when the alleged illegal solicitation (barratry) happened outside Texas?
Lower Court Proceedings
- The trial court dismissed the clients’ claims.
- The court of appeals reversed, holding that 82.0651(a) could apply since some conduct (like arrangement and financing) occurred in Texas.
Supreme Court’s Ruling & Reasoning
Majority Opinion (Justice Huddle)
- Presumption Against Extraterritoriality
- Texas statutes are presumed not to apply outside Texas unless the Legislature clearly says otherwise.
- Section 82.0651(a) does not clearly indicate it has extraterritorial reach.
- Focus of the Statute
- The "focus" is on the actual solicitation of legal services contracts—the acts that procured the contract.
- In this case, those acts (the in-person solicitations) happened in Louisiana and Arkansas, not Texas.
- Rejecting Broader Interpretation
- The clients argued that other conduct (like financing or organizing the solicitation, which occurred in Texas) should be enough for the statute to apply.
- The Court disagreed: since the key prohibited conduct—the improper solicitation—occurred outside Texas, the statute doesn’t apply, even if other related acts happened in Texas.
- Result
- Out-of-state clients cannot use Section 82.0651(a) to void their contracts when the crucial acts took place elsewhere.
- BUT: The clients’ claims for breach of fiduciary duty (based on alleged nondisclosure and other post-solicitation conduct) are not barred and can proceed.
Dissent (Justice Busby)
- Broader View of "Conduct Violating" the Statute
- The dissent argued that the statute covers a range of conduct (including financing and paying for solicitation) and that some of these acts took place in Texas.
- Therefore, applying the statute to this case is not an extraterritorial application.
- The dissent criticized the majority for narrowing the statute’s focus to just in-person solicitation and warned that this lets Texas attorneys profit from alleged misconduct simply because the clients lived in another state.
Key Takeaways
- Texas’s barratry statute does not reach conduct that happens entirely outside Texas, even if Texas lawyers are involved and some planning or financing occurred in Texas.
- Clients’ breach of fiduciary duty claims based on later acts by the lawyers (e.g., failing to disclose important facts) can still go forward.
- The ruling reinforces the strong presumption against Texas civil statutes applying to conduct in other states—unless the Legislature is explicit.
Why It Matters
- This decision draws a sharp line: Out-of-state clients can’t use Texas’s civil anti-barratry law against Texas lawyers for contracts solicited outside Texas.
- It leaves open, though, the possibility of other claims (like breach of fiduciary duty) based on what the lawyers did after the contracts were signed.
- The dissent signals that the Legislature could rewrite the law to clarify its reach if it wants to address this kind of cross-border lawyer misconduct.