Susman Godfrey Wins High Profile Defense Verdict in San Antonio Dispute Over Ownership of Water Exploration Company

SAN ANTONIO, Texas (October 17, 2013) — A jury yesterday soundly rejected claims by two San Antonio attorneys that they were entitled to part ownership in a water exploration company after representing one of its owners in a previous lawsuit.

After a four-week trial in San Antonio’s 225th Judicial District Court, jurors rejected claims by lawyers Thomas C. Hall and Blake Deitzmann that their contingent-fee agreement for representing Dean Davenport entitled them to a 22.5% ownership interest in Davenport’s company, Water Exploration Company (WECO).

High-stakes litigation firm Susman Godfrey LLP represented Davenport in the lawsuit. The firm is one of the few well-known plaintiffs’ law firms to handle an equal number of defense cases.

“We are thrilled with the jury’s ruling for Dean.  He personally drilled these water wells and built this company into what it is today,” said lead counsel, Harry Susman of Susman Godfrey LLP.  “The jury really was focused over a long trial, and they rejected the plaintiffs’ claims after reviewing the evidence.  I was honored to try this important case for Dean.” 

In addition to Susman, Alex Kaplan, Mani Walia and Kristen Schlemmer of Susman Godfrey’s Houston office made up the legal team representing Davenport. The plaintiffs were represented by Ricardo Cedillo, Les Streiber and Mark Kiehne of the San Antonio law firm of Davis, Cedillo & Mendoza.

The case centered on a 2009 high-profile San Antonio lawsuit in which the plaintiffs represented Davenport in a dispute with his two partners in WECO, which now has a long-term contract to provide drinking water to the San Antonio Water System. After the jury returned a $70 million verdict in Davenport’s favor, Davenport settled with his two partners, in 2009 and 2010, recovering some cash and gaining 100 percent ownership of the company as part of the two settlements.

In this lawsuit, plaintiffs Hall and Deitzmann claimed their contingent-fee agreement entitled them not only to 33.5 percent of the cash Davenport recovered – which they were paid – but also to a 33.5 percent ownership interest in the 66 percent of WECO that Davenport recovered through the settlements. At the trial, the plaintiffs asked the jury to award at least $24.6 million in damages as the current value of their alleged ownership interest and at least $18 million in punitive damages for a total of $42.6 million in damages.

In addition to rejecting the plaintiffs contract claims for an ownership interest, the jury also rejected plaintiffs’ claims that Davenport committed fraud by misrepresentation and fraud by concealment and their claim for  conversion. The jury found instead that Davenport was required to pay only $230,000 in contingent litigation expenses advanced by the plaintiffs in the underlying litigation.

“The jury agreed that the contingent-fee contract was limited to the money that Dean recovered in the lawsuit,” said Kaplan. “That’s exactly what the contract says, and it’s what Dean   has said all along.  It did not give the plaintiffs the right to be owners of the company.”