“Gravely is the Best of the Best –
another Texas Legend”
– Joe. K. Longley, Past President, State Bar of Texas
1)Building Contractor Learns the Hard Way: Turnabout is Fair Play
A Texas retirement community in the middle of a $100 million multistory luxury retirement project hired Gravely PC after it was sued by its construction contractor. The Gravely team’s initial job was to defend their client in what was a true bet-the-company situation.
With an approach to litigation that relies on veteran trial lawyers with extensive expertise in construction, design and engineering at the heart of building projects, the Gravely team tackled the case and took a deep dive into the project’s details. That’s when the tables began to turn.
Investigation Leads to Countersuit
In the original lawsuit, the contractor sought $3.5 million in damages from the retirement community. Relying on civil and structural engineers and architectural experts, the team determined that the retirement community was owed far more based on the contractor’s shoddy work and fraudulent misrepresentations. The Gravely team uncovered internal documents that the contractor had failed to turn over. In addition, a forensic review of records revealed that the contractor was committing fraud by paying its workers a fraction of the rate submitted in invoices.
What started as a $3.5 million lawsuit against the retirement community turned into a $20 million counterclaim. The legal fight churned through the court for three years before reaching trial. On the eve of jury selection, the contractor paid $18.4 million to settle the litigation.
2) Texas School District Fights Insurance Co. Bullying Tactics Following Massive Explosion
In April 2013, a massive fertilizer explosion in the Central Texas community of West, Texas, caused catastrophic damage to nearby buildings, including several owned by the West Independent School District. Twelve first responders and three residents died when agricultural fertilizer containing ammonium nitrate caught fire and caused the explosion. The blast left a crater 93-feet wide and 12-feet deep and destroyed nearby buildings and more than 500 homes.
Insurers’ Underhanded Playbook
At the West Independent School District, the district’s insurance providers took a common approach when property owners file property damage claims – they implemented a strategy to delay and stonewall the claims. The insurance companies also sought to minimize the scope of damages and shift responsibility to the Federal Emergency Management Administration.
Aggressive Response Gets Attention – and Resolution
The Gravely legal team filed a lawsuit in McClennan County court, charging that insurance providers Argonaut Insurance Co. and Trident Insurance Co. had breached their contract with the West ISD, failed to pay the damages claims and failed to explain the rejection, as required by law. Gravely appellate lawyers then blocked the insurers’ attempt to exploit a technicality to avoid paying the damages. Out of options and facing Gravely’s aggressive litigation, the parties reached a significant monetary settlement that allowed the school district to rebuild and repair.
3) Partnering with Texas Business Groups to Fight Controversial Insurance Loophole All the Way to the Texas Supreme Court
Insurance companies operating in Texas have long enjoyed an unfair competitive advantage in disputes with policyholders. A loophole that Texas courts have failed to address allows insurers to deflect responsibility for damages claims while shifting the burden of proof to policyholders.
Policyholders Victimized by Loophole
In Overstreet v. Allstate, a property owner filed a claim with Allstate for storm damage. Allstate responded by claiming that factors other than the storm contributed to the damage, a strategy known as concurrent causation. Based on the loophole, the insurer argued that it was the policyholder’s burden to prove why those other factors did not contribute to the damage.
Texas lawmakers did not intend for the insurance industry to have this unfair advantage. The Texas Legislature specifically clarified the insurance code, stating plainly that insurance companies are the ones that should be required to prove their case when they raise a concurrent causation claim. However, Texas courts have instead followed legal precedent from before the legislation was enacted.
Partnering to Protect Texas’ Business-Friendly Climate
No other state in the nation has such a loophole. As Overstreet churned through the courts and advanced to the Supreme Court of Texas, the Texas business community was hopeful that the state’s highest court would review and clarify the loophole for all Texas policyholders. Gravely PC partnered with seven leading industry groups to file an amicus curie brief outlining the business community’s position and why the law has been “mischaracterized, misapplied and misunderstood.”
However, the insurance industry has no interest in having the state’s highest court potentially close the loophole and end their unfair advantage. Insurers frequently make these concurrent causation claims to try to avoid paying policyholders what they’re due. In most cases, it works because policyholders don’t obtain legal representation.
As the Overstreet hearing date approached, Allstate reached a confidential settlement, which allows the loophole to be preserved for future exploitation of Texas policyholders. The Gravely team remains committed to supporting Texas businesses through its amicus work.
4) Exposing Construction, Design Defects and Obtaining Justice for Flagship Museum
When it opened in 2015, the San Antonio Children’s Museum’s $46 million flagship museum was designed as a “foundation for a lifelong love of learning.” The state-of-the-art two-story museum has drawn national attention for its interactive exhibits and creative learning programs.
Questions Arise After Opening
But soon after its opening, construction and design issues began to surface at the donor- and benefactor-supported project dubbed The DoSeum. Among the concerns were defective roofing and heating, ventilation and air conditioning systems that compromised the building’s capacity to meet the needs for the 65,000-square-foot space.
Getting Past Delay Tactics
Insurance companies and contractors are notorious for delaying, rejecting or underfunding claims like these, and this case was no different. The museum called on the Gravely team after the general contractor and insurance carriers failed to adequately address and correct the problems. Like many cases of this type, a lawsuit is often required to get the attention of the defendants and bring them to the table to discuss meaningful actions. The Gravely team is actively prosecuting this litigation, and the matter is ongoing.
5) General Contractor, Design Pros Cut Corners on Luxury High-Rise
Too often, contractors and design professionals reach for the same playbook over and over when confronted by building owners with concerns about the quality of their work. They pledge to fix the problem. They deny and deflect. Their endgame is to wear down project owners and run out the clock on litigation. It often works.
Problems Surface at Marquee Residential Tower
That’s precisely what happened for the owner of a prominent Dallas residential tower after major problems surfaced that rendered the quality of the building far less than promised. Although the designer and builder had promised the best immunities money could buy, the HVAC system was riddled with problems caused by defective or improperly installed mechanical parts. The owner’s concerns languished, and the Gravely team was hired after it became clear that the contractor and design professionals expected the owner to live with it.
Litigation Team Gets to Work
The Gravely team has a playbook of its own. That starts with bringing in specifically qualified and courtroom-tested experts to investigate and taking an aggressive approach to litigation. This approach routinely uncovers the kind of smoking guns – including discrepancies between designs and the actual work performed – that change the negotiation dynamics. In this case, the team discovered the root causes of the problems along with problems with other systems that were not compliant and not of the quality promised. Litigation in this matter is pending.