NEW ORLEANS - Houston state court is the place for a dispute between a personal injury lawyer and his former employer, a reluctant federal appeals court has found in creating a 2-2 split on a technical issue.
The U.S. Court of Appeals for the Fifth Circuit on July 25 ruled against Edward Festeryga, who has been sued by the major Houston firm Abraham Watkins Nichols Agosto Aziz & Stogner. That firm represents plaintiffs in personal injury and product liability cases, among other causes.
It says Festeryga was trying to line up clients to take with him while he was preparing to head to a new firm. The firm filed suit in Harris County District Court in 2022 and successfully defeated Festeryga's partial motion to dismiss under the Texas Citizens Participation Act.
Festeryga said the TCPA applies to any conduct related to the gathering of consumer opinions, consumer commentary and business reviews. He had tried to gather testimonial videos from former clients.
Harris County judge Kristen Hawkins rejected his argument in a one-page order in 2023, leading Festeryga to attempt to change courtrooms. He removed the case to U.S. District Court for the Southern District of Texas, arguing there was diversity jurisdiction (he says he's a citizen of Canada) among the parties and likely hoping for a more receptive judge.
Instead, the judge there found Festeryga had waived his right to remove the case to federal court by filing the TCPA motion to dismiss. The Fifth Circuit took things a step further in ruling a waiver-based remand order is unappealable.
In Re: Weaver was a 1980 Fifth Circuit decision in which defendants in Georgia state court heard of an injunction against them, had a different judge vacate the injunction and removed the case to federal court.
The federal court found, "If the case was removable at all, it was removable prior to the appearance of the defendants in the Superior Court action." The Fifth Circuit said it did not have appellate jurisdiction over the remand order.
The Fifth Circuit's reliance on Weaver leads a 2-2 circuit split on whether waiver-based remand orders can be appealed. Judge Don Willett didn't want to follow Weaver's rules as they pertained to Festeryga's case.
"Based on our review of the parties' briefing and our sister circuits' reasoning, we are persuaded that Weaver rests on erroneous premises," he wrote. "Waiver is a common-law creation and, as a doctrine principally concerned with a party's conduct, cannot affect our subject-matter jurisdiction."
Judge Stuart Kyle Duncan agreed, writing, "Gritting my teeth, I concur." He hopes a full panel of Fifth Circuit judges, on rehearing, would "unweave Weaver."
Festeryga was an associate attorney hired by AW in January 2021 and paid a salary pus dcretionary bonuses. By September 2022, AW had discovered Festeryga was planning to join another firm and allegedly poaching clients, leading to his termination.
AW's lawsuit sought a restraining order and between $250,000 and $1 million in damages. Festeryga said in response that he is owed bonus payments for scoring $35 million in recoveries for clients, referring attorneys and AW.
He alleges AW's lawsuit is retaliation for his demand of bonus payments, calling it a "transparent intimidation tactic."