Brauss, Eric W, Christine Brauss v. Nixdorf Parties
411 S.W.3d 614
| Tex. App. | 2013Background
- Case centers on Brauss-controlled real estate partnerships and a settlement distributing assets via a receiver; trial court approved a broad settlement and issued substantial damages against Brauss, Martin, TRA, and related entities.
- Plaintiffs included eight investors asserting breach, fiduciary duty, alter ego, and veil-piercing claims; two groups (Nixdorf and Song-Winkler) intervened, with Song-Winkler later struck.
- The trial court entered a final judgment awarding over $65 million to the plaintiffs and over $48 million to the Nixdorf appellants, appointing a receiver, and determining ownership and proceeds of Sugar Land project interests.
- Brauss and Martin settled, then intervened to enforce the settlement; the court did not file written findings of fact and conclusions of law.
- On appeal, only some parties challenged the judgment; the court reversed part of the judgment against Martin for the Nixdorf appellants and affirmed the rest.
- The court ultimately rendered, and the judgment on appeal was entered August 13, 2013.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Sufficiency of evidence against Brauss and Martin for Nixdorf claims | Nixdorf asserts substantial evidence of fraud and misrepresentation | Brauss/Martin argue insufficiency or lack of direct dealings | Evidence supports fraud/fraudulent inducement against Brauss; Martin liability lacks evidentiary support |
| Martin's guaranty and note maturity alteration | Watercrest pled valid guaranties; Martin violated agreement | Martin preserved no affirmative defense in response | Affirmative defense not preserved; judgment against Martin affirmed except as to the guarded issue |
| Standing to challenge damages against co-defendants | Nixdorf/Horseshoe claimants assert cross-claims affected by judgment | Interests not injuriously affected; lack standing | Nixdorf/Horseshoe have no standing to challenge other group’s damages |
| Intervention by Song-Winkler and mootness | Intervention sought relief on promissory notes and related claims | Subsequent separate judgments resolved those claims; mootness applies | Moot with respect to some issues; others not moot; court upholds denial of intervention |
| Sugar Land distribution allocations | Distributions should reflect capital contributions including non-cash credits | Distribution per partnership agreement; accounting records support allocations | Court’s Sugar Land distribution allocation sustained |
Key Cases Cited
- City of Keller v. Wilson, 168 S.W.3d 802 (Tex. 2005) (legal sufficiency and evidence review standard for appellate courts)
- Dow Chem. Co. v. Francis, 46 S.W.3d 237 (Tex. 2001) (sufficiency review; great weight standard when reviewing factual findings)
- Haase v. Glazner, 62 S.W.3d 795 (Tex. 2001) (fraud elements in contractual context; fraudulent concealment considerations)
- Baxter v. Palmigiano, 425 U.S. 308 (U.S. 1976) (adverse inferences from exercising Fifth Amendment in civil cases)
- Union Carbide Corp. v. Union Carbide, 273 S.W.3d 152 (Tex. 2008) (justiciable interest and intervention framework; proper scope of appellate review)
- Guar. Fed. Sav. Bank v. Horseshoe Operating Co., 793 S.W.2d 652 (Tex. 1990) (abuse of discretion standard in ruling on intervention/joinder)
- St. Joseph Hosp. v. Wolff, 94 S.W.3d 513 (Tex. 2002) (standard for reviewing credibility and factual findings in bench trials)
