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Negligence lawsuit falls flat due to Texas statute of limitations

When it comes to many matters in business, time is often of the essence. Many Houston companies work under tight deadlines and believe in providing service to customers quickly. When it comes to business litigation, working in a timely fashion is also important. Acting with expedience may save an organization money. One recent case demonstrates that when tens of millions of dollars is at stake, timing is everything.

A Texas law firm represented two competing companies looking to secure their intellectual property. One business obtained the patents they needed for their radio frequency-related devices, and the other organization took notice. The company filed suit against the law firm citing that its staff did not take into account that their representation was a conflict of interest. The suit alleged breach of fiduciary duty and material nondisclosure.

While a jury ruled that the law firm was responsible for damages to the tune of $40.5 million, the ruling also noted that the suit was filed outside the state’s statute of limitations. The plaintiff hired the company in 1998, expressed concerns with the firms in 2002 but did not file suit until 2010. In Texas, there is a four-year window to file suit for a breach of fiduciary duty and a two-year timeframe for negligence suits. As a result, the plaintiff likely will not receive any damages, though both sides of the matter plan to appeal the decision.

Any company that has concerns regarding its intellectual property or other assets should immediately contact an attorney. In addition to protecting the business, acting in a timely manner may ensure that justice is served.

Source: Dallas News, “Jury rules against Baker Botts, then says company waited too long to file the suit,” Natalie Posgate, May 15, 2014

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