SCOTX Refuses to Reconsider Patent Company’s Request to Vacate Arbitrator’s $3 Million Legal Fees Award

Disputing Blog by Karl Bayer, Victoria VanBuren, and Holly Hayes

The Supreme Court of Texas has once again declined to consider a company’s request to vacate an arbitrator’s award in a legal fees dispute.  In Parallel Networks, Inc. v. Jenner & Block, LLP, No. 16-0080, Jenner & Block was retained to represent a patent-holding company in a patent enforcement action that was filed against software giant Oracle.  The contingent fee relationship, however, did not continue through to the conclusion of the case.

After losing a motion for summary judgment, the law firm reportedly determined that Parallel Networks was unlikely to win a large financial award and withdrew from representing the company. The parties’ representation agreement stated any disputes over attorney fees would be subject to arbitration.

With the assistance of new counsel, Parallel Networks later settled the disagreement with Oracle for $20 million. After the case settled, Jenner & Block sought in excess of $10 million in attorney fees from Parallel Networks for the work previously performed by the firm. Pursuant to the parties’ representation agreement, the fee dispute was arbitrated and Jenner & Block received a $3 million award.

Following arbitration, Parallel Networks filed an unsuccessful motion to vacate the arbitrator’s award in Dallas County.  Texas’ Fifth District Court of Appeals agreed with the trial court and the patent-holding company filed a petition for review with the Supreme Court of Texas citing public policy grounds. Last June, the high court denied Parallel Network’s petition.  Two months later, the company gave it one more try and filed a motion for rehearing of its denied petition for review.  On January 20th, the Texas Supreme Court once again denied Parallel Network’s request.

                       

Beth Graham

Beth Graham received a J.D. from the University of Nebraska College of Law in 2004 and a M.A. in Information Science and Learning Technologies from the University of Missouri in 2006. She also holds a B.S. in Public Administration from the University of Nebraska-Omaha. She is licensed to practice law… MORE >