HOUSTON - The First Court of Appeals today affirmed a ruling denying an attorney’s motion to dismiss a lawsuit brought by a lawsuit lender.
Alleging breach of contract, Series 2 – Virage Master filed suit against The Sydow Firm, Michael Sydow and David Fettner, as receiver, on Jan. 18, 2023, in Harris County District Court.
According to the original petition, Virage is a litigation funding company that lends to law firms for business purposes, including marketing, case expenses, overhead and growth. On Nov. 20, 2014, Virage and Sydow and the firm agreed to a loan of $2,060,000.
Since 2014, Sydow has only repaid $22,425 to Virage, the lawsuit asserts.
Court records show Sydow and his firm filed a petition for a writ of mandamus challenging the trial court’s Aug. 9, 2023 order denying their “Motion to Dismiss for Lack of Jurisdiction,” along with the trial court’s Oct. 17, 2023 order on Virage’s motion to compel discovery.
On the discovery issue, the 14th Court concluded that parts of Virage’s request for production are overbroad and not “narrowly tailored” to seek only relevant information.
“Because we conclude that the trial court’s October 17, 2023 discovery order is overbroad, the trial court has abused its discretion and the order must be vacated if there is no adequate remedy on appeal,” the opinion states.
However, justices denied Sydow’s mandamus petition asking them to vacate the order denying his motion to dismiss.
“We conclude that Sydow has failed to establish that he is entitled to mandamus relief from the trial court’s August 9, 2023 order denying his motion to dismiss for lack of jurisdiction,” the opinion states. “Accordingly, we deny Sydow’s petition for writ of mandamus to the extent that it requests that we direct the trial court to vacate its August 9, 2023 order.”
Appeals case No. 01-23-00694-CV