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DALLAS COUNTY
1/6/2014 5:28:20 PM
GARY FITZSIMMONS
DISTRICT CLERK
CAUSE NO. DC10-13481
RECORD’S BARBEQUE, INC., § IN THE DISTRICT COURT
LOQUITA RECORD COOMBS,
ROTUNDA RECORD, KEBRA RECORD,
ALBERT RECORD, SR., EDITH
RECORD FRAZIER and BARBARA
RECORD
Vv. DALLAS COUNTY, TEXAS
ALBERT RECORD, JR.,
Vv.
LEARK INC and THE RECORD
IRREVOCABLE TRUST 68th JUDICIAL DISTRICT
RESPONSE TO MOTION TO REINSTATE CASE ON DOCKET
Mr. Record’s Motion to Reinstate Case on Docket (“Motion”) is legally and factually
groundless. This case was settled and dismissed over a year ago. Record’s Barbeque! has
upheld everything to which it agreed in the settlement agreement. However, Mr. Record now
seeks to walk back on the agreement which he entered under the advice of counsel. As shown
herein, Mr. Record has no legitimate basis to challenge the settlement agreement or Record’s
Barbeque’s conduct thereunder. As a result, Mr. Record has filed this Motion which is entirely
groundless in law and fact. This Motion is legally groundless because Rule 270 is entirely
inapplicable to the alleged issue at hand. The Motion is factually groundless because Mr. Record
has presented no evidence, or even factual argument, supporting his position here. This Motion
appears to be merely an effort to reopen discovery and extort additional funds from Record’s
Barbeque.
' This Response will use the term “Record’s Barbeque” to collectively refer to all respondents for ease of reference.
Response to Motion to Reinstate Case on Docket Page 1 of 7
I. Background
As the Court may recall, and as the Court’s docket reflects, this case was set for trial on
July 17, 2012. After seating a jury, but before opening statements or evidence, the parties
reached a settlement agreement. The settlement’s general terms were read into the record and
agreed by all parties (including Mr. Record) on July 17. The settlement agreement’s terms were
later memorialized by a written settlement agreement signed by all parties (including Mr.
Record). The case was thereafter dismissed by the Court on October 22, 2012. See, Exhibit A.
This Motion directly challenges the settlement agreement’s core provision. The
settlement was specifically designed to create a procedure whereby Mr. Record’s interest (if any)
in the two corporate entities, Record’s Barbeque Inc. and Leark, Inc., could be valued and bought
out. Valuing that interest, however, was difficult given the lack of trust between the parties at
the time of the settlement. Indeed, the recitation of the settlement terms into the record ended
with Mr. Record shouting at his own mother over the disposition of a wood splitter belonging to
Record’s Barbeque Inc.
To address that lack of trust, the settlement agreement specifically took the valuation
decision out of any party’s hands. The settlement agreement required the mediator, Jeff Abrams,
to choose an independent expert who would value Mr. Record’s alleged interest and thus the
commensurate settlement payments (if any). Settlement Agreement J 3.2 The expert would be
retained by all of the parties with Mr. Record being responsible for 20% of the expert’s fee. Jd.
at § 3(d). The parties specifically agreed and the expert was specifically “instructed to take into
account actual and potential tax liabilities, including, if necessary, estimations of any tax
liabilities based on information available at the valuation’s time” Jd. at § 3(e). Mr. Record
*The settlement agreement is confidential and the movant, who bears the burden in this Motion, failed to present it to
the Court. Should the Court wish to review the settlement agreement, counsel will provide a copy for in camera
inspection.
Response to Motion to Reinstate Case on Docket Page 2 of7
further was to receive substantial weekly payments during the approximately one year between
the settlement’s effective date and the date on which any payment for Mr. Record’s alleged
interest was to begin. Id. at | 4. Those interim payments were to be then deducted from any
payment for Mr. Record’s alleged interest that might be due based on the expert’s valuation. Id.
Everything the settlement agreement required has been done. Mr. Abrams, without input
from any party, selected the Katzen Marshall firm to value the alleged ownership interest at
issue. Katzen Marshall did so, Katzen Marshall’s valuation took into account the estimated tax
liabilities. Katzen Marshall’s valuation found that Mr. Record’s alleged interest is worth $0 both
with and without those estimated tax liabilities. Despite having a worthless interest, Mr. Record
received tens of thousands of dollars in interim payments.
The only dispute here is that Mr. Record does not like the result or the procedure to
which he agreed. Record’s Barbeque has more than upheld every provision to which it agreed in
settling this case. In return, Mr. Record and his attorney have violated the peace Record’s
Barbeque purchased in what can only be seen as an attempt to shake down and extort money. As
shown herein, the Motion is frivolous and meritless in every way.
II. The Motion is Groundless in Law.
A motion to reopen evidence under Texas Rule of Civil Procedure 270 has nothing to do
with the issue Mr. Record alleges. Mr. Record’s Motion is based solely on Texas Rule of Civil
Procedure 270. That rule concerns only the ability of a court to permit additional evidence at any
time until the jury returns a verdict. See Tex. R. Civ. P. 270. That rule in no way concerns
reopening a case that has been dismissed. Further, even if it did, there is no evidence to reopen.
This case settled before opening statement or evidence.
Texas law unquestionably states that a party’s sole recourse for an alleged breach of a
Response to Motion to Reinstate Case on Docket Page 3 of7
settlement agreement is a suit sounding in contract. Texas Civil Practice and Remedies Code §
154.071 provides in relevant part “If the parties reach a settlement and execute a written
agreement disposing of the dispute, the agreement is enforceable in the same manner as any
other written contract.” Likewise, the Dallas Court of Appeals has affirmed that alleged
breaches of a settlement agreement must be presented in the context of a breach of contract
claim. See, e.g. Cadle Co. v. Castle, 913 S.W.2d 627, 630-32 (Tex. App.—Dallas 1995, writ
denied).
Mr. Record is likely avoiding the proper procedure because he cannot state a claim for
breach of contract. The settlement agreement in no way gives him the right to engage in the type
of fishing expedition he seeks here. In fact, the settlement agreement specifically states that Mr.
Record has no further rights with respect to Record’s Barbeque as of the settlement date (July 17,
2012). The only party breaching the settlement is Mr. Record.
IIL. The Motion is Groundless in Fact.
The Motion presents no facts or evidence that could entitle Mr. Record to prevail here.
First, the Motion utterly fails to provide the Court with any evidence. As Mr. Record bears the
burden in this Motion, such failure is fatal to the relief requested. Further, Mr. Record’s failure
to offer any evidence allows Mr. Record to mischaracterize the record (which he does so
regularly) and leaves the Court guessing as to the actual facts at issue.
Even were the Court to consider Mr. Record’s inapposite argument under Rule 270, he
has presented no factual reason supporting any required element.
A. Mr. Record Has Not Acted Diligently.
Mr. Record’s own Motion admits that he delayed in filing the Motion for over two
months from the time he allegedly received the business valuation and over six weeks from the
Response to Motion to Reinstate Case on Docket Page 4 of7
time he and his attorneys allegedly met with Katzen Marshall concerning the valuation. Further,
Mr. Record neglects to inform the Court that he was first offered a copy of the valuation on
August 26, 2013, over three months before filing the Motion. Letter from R. Roberts to A.
Record (August 26, 2013) (Exhibit B). That cannot be described as diligence.
B. Mr. Record Has Not Identified Any Relevant Evidence
Despite having the burden to show the Court that he would offer decisive additional
evidence, Mr. Record has failed to articulate even a single piece of evidence he intends to offer.
Mr. Record fails to articulate what specific evidence is allegedly missing or how that evidence
would allegedly change the valuation. Instead, Mr. Record asks the Court to allow him a fishing
expedition into Record’s Barbeque documents, to which he has no legal right, in an effort to gin
up an argument.
Indeed, Mr. Record’s argument affirmatively misrepresents the facts to the Court. The
Motion claims that the share value to be paid to Mr. Record is $0 only because of the $2.1
million tax liability the company faces. That is untrue. The valuation calculated Mr. Record’s
interest both with and without the tax liability. Under both calculations, Mr. Record’s assessed
value is worth $0. Cover Letter p. 1; Report p. 28-30.
C. Reopening the Case will Necessarily Cause a Delay
This case has been settled for eighteen (18) months and closed for over a year. Mr.
Record asks the Court to reopen the case so that he can undertake a fishing expedition into
additional discovery and a trial setting. That can be described only as delay.
D. Allowing this Fishing Expedition Would Unjustly Prejudice Record’s Barbeque
Record’s Barbeque settled this case to achieve peace and all of the parties (including Mr.
Record) agreed to a procedure specifically designed to avoid this exact Motion. The parties
Response to Motion to Reinstate Case on Docket Page 5 of7
(including Mr. Record) all agreed to have an independent evaluator value the companies at issue
exactly to avoid the type of collateral attack that Mr. Record seeks here. Record’s Barbeque has
entirely upheld its end of that agreement. In return, Mr. Record has done nothing to which he
agreed.
Further, Mr. Record argues only facts of which he was aware before entering the
settlement agreement. The estimated tax liability was no surprise. Indeed, the settlement
agreement specifically required the valuator to take it into account. The monies Mr. Record
owes to Record’s Barbeque are those monies that he stole from the cash register over the years
he supposedly worked at the restaurant. The state of Record’s Barbeque’s financial information
was likewise well known to Mr. Record.
LE
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John Helms Jr.
Texas Bar No. 09401001
Jhelms@fhsulaw.com
R. Ritch Roberts, III
Texas Bar No, 24041794
rroberts@fhsulaw.com
Fitzpatrick, Hagood, Smith & Uhl LLP
2515 McKinney Avenue
Suite 1400
Dallas, TX 75201
Tel. 214-237-0900
Fax. 214-237-0901
ATTORNEYS FOR RECORD’S
BARBEQUE, INC., LOQUITA RECORD
COOMBS, ROTUNDA RECORD, KEBRA
RECORD, ALBERT RECORD, SR.,
EDITH RECORD, LEARK, INC. AND
THE RECORD IRREVOCABLE FAMILY
TRUST
Response to Motion to Reinstate Case on Docket Page 6 of 7
CERTIFICATE OF SERVICE
I hereby certify that, on January, 2014, I caused service of the above and foregoing
instrument in accordance with the Texas Rules of Civil Procedure, as follows:
VIA Pancl a
Walter Musgrove
Musgrove Law Firm
P.O. Box 132274
Dallas, TX 75313
Tel: (214) 516-9769
Fax: (214) 426-2608
Ritch Roberts, III
Response to Motion to Reinstate Case on Docket Page 7 of 7
Preview
l DALLAS COUNTY 1/6/2014 5:28:20 PM GARY FITZSIMMONS DISTRICT CLERK CAUSE NO. DC10-13481 RECORD’S BARBEQUE, INC., § IN THE DISTRICT COURT LOQUITA RECORD COOMBS, ROTUNDA RECORD, KEBRA RECORD, ALBERT RECORD, SR., EDITH RECORD FRAZIER and BARBARA RECORD Vv. DALLAS COUNTY, TEXAS ALBERT RECORD, JR., Vv. LEARK INC and THE RECORD IRREVOCABLE TRUST 68th JUDICIAL DISTRICT RESPONSE TO MOTION TO REINSTATE CASE ON DOCKET Mr. Record’s Motion to Reinstate Case on Docket (“Motion”) is legally and factually groundless. This case was settled and dismissed over a year ago. Record’s Barbeque! has upheld everything to which it agreed in the settlement agreement. However, Mr. Record now seeks to walk back on the agreement which he entered under the advice of counsel. As shown herein, Mr. Record has no legitimate basis to challenge the settlement agreement or Record’s Barbeque’s conduct thereunder. As a result, Mr. Record has filed this Motion which is entirely groundless in law and fact. This Motion is legally groundless because Rule 270 is entirely inapplicable to the alleged issue at hand. The Motion is factually groundless because Mr. Record has presented no evidence, or even factual argument, supporting his position here. This Motion appears to be merely an effort to reopen discovery and extort additional funds from Record’s Barbeque. ' This Response will use the term “Record’s Barbeque” to collectively refer to all respondents for ease of reference. Response to Motion to Reinstate Case on Docket Page 1 of 7 I. Background As the Court may recall, and as the Court’s docket reflects, this case was set for trial on July 17, 2012. After seating a jury, but before opening statements or evidence, the parties reached a settlement agreement. The settlement’s general terms were read into the record and agreed by all parties (including Mr. Record) on July 17. The settlement agreement’s terms were later memorialized by a written settlement agreement signed by all parties (including Mr. Record). The case was thereafter dismissed by the Court on October 22, 2012. See, Exhibit A. This Motion directly challenges the settlement agreement’s core provision. The settlement was specifically designed to create a procedure whereby Mr. Record’s interest (if any) in the two corporate entities, Record’s Barbeque Inc. and Leark, Inc., could be valued and bought out. Valuing that interest, however, was difficult given the lack of trust between the parties at the time of the settlement. Indeed, the recitation of the settlement terms into the record ended with Mr. Record shouting at his own mother over the disposition of a wood splitter belonging to Record’s Barbeque Inc. To address that lack of trust, the settlement agreement specifically took the valuation decision out of any party’s hands. The settlement agreement required the mediator, Jeff Abrams, to choose an independent expert who would value Mr. Record’s alleged interest and thus the commensurate settlement payments (if any). Settlement Agreement J 3.2 The expert would be retained by all of the parties with Mr. Record being responsible for 20% of the expert’s fee. Jd. at § 3(d). The parties specifically agreed and the expert was specifically “instructed to take into account actual and potential tax liabilities, including, if necessary, estimations of any tax liabilities based on information available at the valuation’s time” Jd. at § 3(e). Mr. Record *The settlement agreement is confidential and the movant, who bears the burden in this Motion, failed to present it to the Court. Should the Court wish to review the settlement agreement, counsel will provide a copy for in camera inspection. Response to Motion to Reinstate Case on Docket Page 2 of7 further was to receive substantial weekly payments during the approximately one year between the settlement’s effective date and the date on which any payment for Mr. Record’s alleged interest was to begin. Id. at | 4. Those interim payments were to be then deducted from any payment for Mr. Record’s alleged interest that might be due based on the expert’s valuation. Id. Everything the settlement agreement required has been done. Mr. Abrams, without input from any party, selected the Katzen Marshall firm to value the alleged ownership interest at issue. Katzen Marshall did so, Katzen Marshall’s valuation took into account the estimated tax liabilities. Katzen Marshall’s valuation found that Mr. Record’s alleged interest is worth $0 both with and without those estimated tax liabilities. Despite having a worthless interest, Mr. Record received tens of thousands of dollars in interim payments. The only dispute here is that Mr. Record does not like the result or the procedure to which he agreed. Record’s Barbeque has more than upheld every provision to which it agreed in settling this case. In return, Mr. Record and his attorney have violated the peace Record’s Barbeque purchased in what can only be seen as an attempt to shake down and extort money. As shown herein, the Motion is frivolous and meritless in every way. II. The Motion is Groundless in Law. A motion to reopen evidence under Texas Rule of Civil Procedure 270 has nothing to do with the issue Mr. Record alleges. Mr. Record’s Motion is based solely on Texas Rule of Civil Procedure 270. That rule concerns only the ability of a court to permit additional evidence at any time until the jury returns a verdict. See Tex. R. Civ. P. 270. That rule in no way concerns reopening a case that has been dismissed. Further, even if it did, there is no evidence to reopen. This case settled before opening statement or evidence. Texas law unquestionably states that a party’s sole recourse for an alleged breach of a Response to Motion to Reinstate Case on Docket Page 3 of7 settlement agreement is a suit sounding in contract. Texas Civil Practice and Remedies Code § 154.071 provides in relevant part “If the parties reach a settlement and execute a written agreement disposing of the dispute, the agreement is enforceable in the same manner as any other written contract.” Likewise, the Dallas Court of Appeals has affirmed that alleged breaches of a settlement agreement must be presented in the context of a breach of contract claim. See, e.g. Cadle Co. v. Castle, 913 S.W.2d 627, 630-32 (Tex. App.—Dallas 1995, writ denied). Mr. Record is likely avoiding the proper procedure because he cannot state a claim for breach of contract. The settlement agreement in no way gives him the right to engage in the type of fishing expedition he seeks here. In fact, the settlement agreement specifically states that Mr. Record has no further rights with respect to Record’s Barbeque as of the settlement date (July 17, 2012). The only party breaching the settlement is Mr. Record. IIL. The Motion is Groundless in Fact. The Motion presents no facts or evidence that could entitle Mr. Record to prevail here. First, the Motion utterly fails to provide the Court with any evidence. As Mr. Record bears the burden in this Motion, such failure is fatal to the relief requested. Further, Mr. Record’s failure to offer any evidence allows Mr. Record to mischaracterize the record (which he does so regularly) and leaves the Court guessing as to the actual facts at issue. Even were the Court to consider Mr. Record’s inapposite argument under Rule 270, he has presented no factual reason supporting any required element. A. Mr. Record Has Not Acted Diligently. Mr. Record’s own Motion admits that he delayed in filing the Motion for over two months from the time he allegedly received the business valuation and over six weeks from the Response to Motion to Reinstate Case on Docket Page 4 of7 time he and his attorneys allegedly met with Katzen Marshall concerning the valuation. Further, Mr. Record neglects to inform the Court that he was first offered a copy of the valuation on August 26, 2013, over three months before filing the Motion. Letter from R. Roberts to A. Record (August 26, 2013) (Exhibit B). That cannot be described as diligence. B. Mr. Record Has Not Identified Any Relevant Evidence Despite having the burden to show the Court that he would offer decisive additional evidence, Mr. Record has failed to articulate even a single piece of evidence he intends to offer. Mr. Record fails to articulate what specific evidence is allegedly missing or how that evidence would allegedly change the valuation. Instead, Mr. Record asks the Court to allow him a fishing expedition into Record’s Barbeque documents, to which he has no legal right, in an effort to gin up an argument. Indeed, Mr. Record’s argument affirmatively misrepresents the facts to the Court. The Motion claims that the share value to be paid to Mr. Record is $0 only because of the $2.1 million tax liability the company faces. That is untrue. The valuation calculated Mr. Record’s interest both with and without the tax liability. Under both calculations, Mr. Record’s assessed value is worth $0. Cover Letter p. 1; Report p. 28-30. C. Reopening the Case will Necessarily Cause a Delay This case has been settled for eighteen (18) months and closed for over a year. Mr. Record asks the Court to reopen the case so that he can undertake a fishing expedition into additional discovery and a trial setting. That can be described only as delay. D. Allowing this Fishing Expedition Would Unjustly Prejudice Record’s Barbeque Record’s Barbeque settled this case to achieve peace and all of the parties (including Mr. Record) agreed to a procedure specifically designed to avoid this exact Motion. The parties Response to Motion to Reinstate Case on Docket Page 5 of7 (including Mr. Record) all agreed to have an independent evaluator value the companies at issue exactly to avoid the type of collateral attack that Mr. Record seeks here. Record’s Barbeque has entirely upheld its end of that agreement. In return, Mr. Record has done nothing to which he agreed. Further, Mr. Record argues only facts of which he was aware before entering the settlement agreement. The estimated tax liability was no surprise. Indeed, the settlement agreement specifically required the valuator to take it into account. The monies Mr. Record owes to Record’s Barbeque are those monies that he stole from the cash register over the years he supposedly worked at the restaurant. The state of Record’s Barbeque’s financial information was likewise well known to Mr. Record. LE pectfi <> PZ ae? John Helms Jr. Texas Bar No. 09401001 Jhelms@fhsulaw.com R. Ritch Roberts, III Texas Bar No, 24041794 rroberts@fhsulaw.com Fitzpatrick, Hagood, Smith & Uhl LLP 2515 McKinney Avenue Suite 1400 Dallas, TX 75201 Tel. 214-237-0900 Fax. 214-237-0901 ATTORNEYS FOR RECORD’S BARBEQUE, INC., LOQUITA RECORD COOMBS, ROTUNDA RECORD, KEBRA RECORD, ALBERT RECORD, SR., EDITH RECORD, LEARK, INC. AND THE RECORD IRREVOCABLE FAMILY TRUST Response to Motion to Reinstate Case on Docket Page 6 of 7 CERTIFICATE OF SERVICE I hereby certify that, on January, 2014, I caused service of the above and foregoing instrument in accordance with the Texas Rules of Civil Procedure, as follows: VIA Pancl a Walter Musgrove Musgrove Law Firm P.O. Box 132274 Dallas, TX 75313 Tel: (214) 516-9769 Fax: (214) 426-2608 Ritch Roberts, III Response to Motion to Reinstate Case on Docket Page 7 of 7