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PHILIPPE CRAS,
HARRIS COUNTY, TEXAS
STEWART TITLE COMPANY
and WALLGOOD, L.L.C.,
Defendants. § 234 JUDICIAL DISTRICT
PLAINTIFF’S RESPONSE TO DEFENDANT
WALLGOOD’S MOTION FOR
TO THE HONORABLE JUDGE LAUREN REEDER:
Plaintiff Philippe Cras (“Cras”) files this Response to Defendant Wallgood, L.L.C.
d/b/a Remax’s Traditional and No Evidence Motion for Summary Judgment and would
In this case, Mr. Cras attempted to fulfill his lifelong dream of buying his daughter
her very own home. Instead, he was defrauded into wiring his life savings—$250,000—
to a fraudster who emailed fake wiring instructions from a spoofed email account.
Barbara Noonan, a Remax agent, was the listing agent for the transaction whose email
account was spoofed.
The Court should now deny Remax’s conclusory and threadbare motion for
summary judgment. Remax has fallen far short of its burden of conclusively negating
that it owed a duty of care to Mr. Cras. To the contrary, the evidence shows that realtors,
like title companies, were well aware of the pervasive and ongoing threat of wire fraud
and phishing schemes targeting home buyers like Mr. Cras and, therefore, owed a duty to
warn them of that threat. Even the National Association of Realtors issued an “urgent
warning” urging realtors to warn all transaction participants about the threat of wire fraud
and phishing schemes. Noonan an
Moreover, despite Remax’s conclusory arguments to the contrary, the evidence
shows that Noonan was the agent of Remax, meaning that Remax can be liable for her
negligence. Remax was Noonan’s “sponsoring broker,” and she did business under the
Remax name.
The Court should also deny Remax’s no-evidence points. As established below,
Mr. Cras has adduced more than a scintilla of evidence to support each element of his
IL.
ACKGROUND
Since at Least 2015, Title Companies and Real Estate Companies Across the
Nation—Including STC—Become Embroiled in a Massive Amount of Fr
Since at least 2015, real estate closing transactions have been plagued by wire
fraud and phishing schemes. The American Land Title Association (“ALTA”)—a
nationwide special-interest organization for title companies—described these phishing
Criminals begin the wire fraud process way before the attempted theft
occurs. Most often, they begin with a common social engineering technique
called phishing. This can take the form of email messages, website forms or
phone calls to fraudulently obtain private information. Through seemingly
innocuous communication, criminals trick users into inputting their
information or clicking a link that allows hackers to steal login and
password information.
Once hackers gain access to an email account, they will monitor messages
to find someone in the process of buying a home. Hacks can come from
various parties involved in a transaction, including real estate agents, title
companies, attorneys or consumers. Criminals then use the stole
information to email fraudulent wire transfer instructions dressed up to
appear as if they came from the victim. To this end, criminals will use
either the victim’s actual email account (which they may actually control)
April 2017 ALTA Story About Wire Fraud and Phishing Scams; Ex.
Given the ever-increasing threat of phishing scams, ALTA issued a warning to
Title professionals are encouraged to remind clients about the risk of wire
fraud, especially during later phases of the transaction. To combat this
Put consumer warnings on websites and communications
Used secured email communications
Sent notices to consumers and real estate agents informing
them that the title companies’ wire instructions will never
change during the transaction
Called homebuyers and real estate agents on a known number
Verified account holder information with the receiving bank
ALTA further urged title professionals to put warnings in their email signature lines,
Be aware! Online banking fraud is on the rise. If you receive
an email containing WIRE TRANSFER INSTRUCTIONS
call us immediately to verify the information prior to sending
Due to increased fraud, buyers, sellers and lenders should
confirm all wiring instructions by phone directly with our
WARNING! WIRE FRAUD ADVISORY: Wire fraud and
email hacking/phishing attacks are on the increase! If you
have an escrow or closing transaction with us and you receive
an email containing Wire Transfer Instructions, DO NOT
RESPOND TO THE EMAIL! Instead, call your escrow
officer/closer immediately, using previously known contact
information and NOT information provided in the email, to
verify the information prior to sending funds.
Title Companies were not the only ones warned about phishing schemes. As the
number of wire fraud schemes rose in 2015 and 2016, the Federal Trade Commission
March 2016 that:
Hackers have been breaking into some consumers’ and real estate
professionals’ email accounts to get information about upcoming real estate
transactions. After figuring out the closing dates, the hacker sends an email
to the buyer, posing as the real estate professional or title company. The
bogus email says there has been a last minute change to the wir
instructions, and tells the buyer to wire closing costs to a different account.
But it’s the scammers account. If the buyer takes the bait, their bank
account could be cleared out in a matter of minutes. Often, that’s money
STOP. Email is not a secure wayt
real estate professional or title company should know that.
Phishing Scams; Ex. B).
In December 15, 2015, the National Association of Realtors issued an “Urgent
Urgent Release from National Association of Realtors; Ex. C) (emphasis added).
The National Association of Realtors urged all realtors to take proactive steps to
prevent wire fraud including: “Immediately contactjing] all parties to all your
upcoming transactions and informing] them of the possibility of this fraud.”
(emphasis added).
In apparent recognition of the risk of fraud and phishing scams, Ms. Barbara
Noonan, Remax’s agent, testified that wire instructions should
Given the Pervasive Nature of Wire Fraud and Phishing Schemes Targeting
STC, like ATLA and other title companies across the nation, was intimately aware
of the massive increase in phishing schemes in the mid 2010’s. On March 24, 2016—six
months before Plaintiff was defrauded—STC’s Genady Vishnevetsky (who submitted an
affidavit in support of STC’s motion for summary judgment) published a blog article on
STC’s website warning of the pervasive nature of wire fraud and phishing schemes
This post may affect many of you not only professionally, but a
personally. JP Morgan estimated 27 percent of wire transfers in 2014 were
affected by either attempted or actual fraud. Imagine the worst: the funds in
the transaction did not transfer from buyer to rightful seller and are now
The primary attribute of any wire fraud scam is a sense of urgency.
Phishing employs an email that frequently appears to be urgent and to be
coming from someone with authority, directed to someone else who is
responsible for wiring transactions within the organization.
Depending on the level of sophistication, the attacker’s email may look
very genuine (using corporate logos, style sheets, signatures, etc.).
Unfortunately, the more authentic the fraudulent email appears, the more it
indicates that some corporate email or system was compromised.
In our industry, fraudsters are targeting sellers, buyers, REALTORS® and
title companies participating in a transaction. While there are many
different ways for an impostor to commit a fraud, there are two most
common ways they get it done. Both are the result of a user’s computer
2016 STC Blog About Phishing Scams; Ex. E). STC promoted Vishnevetsky with
on its twitter page, tweeting “[d]o you know the risks of wire fraud? Stewart’s CISO
[Chief Information Security Officer], Genady Vishnevetsky, provides insights to protect
your data.” ( STC’s March 25, 2016 Tweet Promoting Blog About Wire Fraud and
Even before STC’s CISO published blog entries about the prevalence of phishing
scams—and the risk that “people’s life savings” will be taken away—STC had already
implemented a “strict policy” internally in order to combat the prevalence of phishing
scams. In December 2015, STC’s president, general counsel, chief risk officer, and vice
present of escrow account issued a joint bulletin to all of STC’s escrow employees
Wire transfers have become one of the most prevalent targets for fraud.
There are various points of compromise, all of which can result in a wire
initiation that transfers funds fraudulently to thieves. The result can be
catastrophic to our company in terms of monetary loss and damage to
reputation. We have experienced a number of these attempts in the last year
and they increase every week. As a result, strict processes must be put in
place to protect against these types of fraud. The policy below sets forth the
required security process and procedures applicable to wire instructions and
In September 2016, Mr. Cras Became a Customer of STC for a Real Estate
Closing. STC Never Warned Him About the Prevalence of Ongoing Phishing
Schemes, and Mr. Cras Becomes a Victim of the Exact Same Phishi
out and Loses $250,000.
Mr. Cras is a native of Belgium. ( Deposition of Philippe Cras; 7:14-7:25; Ex.
H). While Mr. Cras has bought and sold real estate before, he is not a “real estate
developer” as STC claims. Instead, he owned and operated a single hotel as his primary
occupation since coming the United States. . at 18:1-18:12. Mr. Cras’s “development”
experience came from building small, European-sized condominiums in Europe from the
mid-80’s to the mid-90’s, as well as purchasing and/or selling approximately five homes
during this time period and a few more homes throughout his lif at 13:11-15:13.
It had always been Mr. Cras’s dream to someday buy a home for his daughter, and
- at 91:2-91:9.
In 2016, after months of searching, Mr. Cras’s daughter finally found her dream
home in Kingwood, Texas, only a few houses away from where Mr. Cras lived. Mr. Cras
signed the contract to purchase the home. Barbara Noonan, a Remax realtor, represented
the seller during the transaction. ( Residential Real Estate Contract for 5126
It is undisputed Mr. Cras and the seller hired STC to act as the title company and
escrow agent for the transaction. . at §5 (designating STC as “escrow agent”). STC—
despite being aware of rampant fraud and phishing schemes targeting home purchasers
While STC callously chides Mr. Cras for falling for the scam despite having participated in real estate
purchases years before, it admits that these sort of scams only started happening in recent years.
Deposition of Yvonne Duncan, 33:3-33:12; Ex. I). Thus, it is unclear why Mr. Cras should have been on
the lookout for a scam that he did not know existed (but which STC was clearly aware of).
during the closing process—did_not_issue_any warnings to the parties about the
prevalence of wire fraud, nor did they issue any warnings or instructions to Mr.
Cras on how to identify and avoid wire fraud and phishing schem Incredibly,
Yvonne Duncan, STC’s escrow agent for the transaction, testified that she had not even
“heard” about the ongoing scams prior to Mr. Cras’s closing even though STC’s own
Chief Information Security Officer had posted warnings about it six months prior. (
Unfortunately, in the absence of any warning from STC, Mr. Cras fell victim to
the exact same phishing scheme that STC was intimately aware of, and that its own Chief
Information Security Office had warned about. A criminal named Brian Herbert gained
access to Barbara Noonan’s email account, monitored the parties’ communications, and
then—when the time was right—began emailing Mr. Cras from a slightly different,
spoofed email account—noonanbarbara@hotmail, instead of banoonan@earthlink.net.
onan Email Address; Ex. K with
Noonan’s Correct Email Address; Ex. L). Both email addresses, however, displayed as
“Barbara Noonan.”
On September 9, 2016, at 7:33 a.m., Cras received an email from the fraudulent
Noonan email account stating:
I hope you had a nice flight back home. Our CDA has arrived and sent to
title company. This means we are in a good shape to close on time. Now
what we need is the wire to come through today to avoid us extending the
[wiring information not shown]
Do send a wiring confirmation to my email when the transfer has
Importantly, this email—unbeknownst to Cras—contained three of the most tell
tale signs of a wire fraud and phishing scheme that STC knew about: (1) a fraudulent
email address that slightly differed from the correct email ( STC Cyber Security
Presentation at 000489; Ex. M) (describing how phishing schemes make use of slightly-
altered email addresses unlikely to be noticed by victim); ( STC’s 2016 Blog About
Wire Fraud and Phishing Scams; Ex. E) (warning that the “the attacker’s [fake] email
[address] may look very genuine”); (2) the sense of urgency to make a transfer soon,
(“The primary attribute of any wire fraud scam is a sense of urgency . . . [p]hishing
employs an email that frequently appears to be urgent[.]; and (3) wire instructions that
changed at the last minute, (stating that the scammer “patiently waits for a closing
date or completion of a transaction to make a very last minute move — chang[ing] wiring
instruction. No one wants to delay a business deal; that’s what criminals are counting
on.”). Mr. Cras may have instantly recognized this email as a scam—if only STC had
bothered to warn him to watch
On September 9, 2016, at 9:52 a.m. Cras emailed STC and let them know that he
See you Monday at 10:00 a.m. [fo
to Woodforest bank today. It will be after 3:00 p.m. since I just returned
from Europe. I am swamped with meetings until 3:00 p.m., but will take
Cras Email to STC About Wiring Money; Ex. N). Importantly, at the time Cra:
sent_his email, STC had not given Cras a settlement_statement_or any wiring
, and thus should have immediately realized that Cras had been given
fraudulent wiring instructions. ( Deposition of Yvonne Duncan, 63:9-64:1; Ex. 1). Of
course, based on Mr. Duncan’s other testimony, STC had apparently not alerted its
escrow agents (who are in the best position to warn parties) to the pervasive ongoing wire
fraud and phishing schemes. Thus, no one from STC warned or stopped Mr. Cras,
though it was STC’s internal policy to have their customers call and confirm account
numbers before wiring any funds Id. at 38:10-38:22 (“If we knew a customer was gonna
send a wire we had to confirm. They needed to call us and confirm account numbers.”).
Inexplicably, STC failed to follow its own internal procedure by not telling Mr. Cras to
By 11:30 a.m., having not been stopped or warned by STC, Mr. Cras completed
Linda, I transferred the $250,000. It is 11:30 [a.m.]. Thanks for ordering
Cras Email to STC Confirming that Wire Had Been Sent; Ex. O). Still, STC did not
alert or warn Cras that he had been given false instructions. Nor did STC bother to
The settlement statement, which tells the seller how much he or she needs to wire (the “cash to close”),
was not sent to Cras until the next week.
The closing was originally set for Monday, September 12, 2016, but was moved by amendment to
September 16, 2016.
confirm whether any wire was actually pending. Instead, September 9 , 10 , 11 , 12
On September 16, 2016, Mr. Cras, his daughter, and his wife appeared at STC’s
Kingwood office for the closing. Mr. Cras, at his deposition, described the moment that
After all the [closing] documents were signed . . . Ms. Duncan
escrow agent] said, “all I need is the money.” And I said, “well, I wired it
to you.” And she went, like, “oh, not again.” And my wife was there, my
daughter. And it was supposed to be a festive moment, right, I
supposed to be a champagne kind of moment. And I —you know how it is
when you’re told somebody died, somebody close to you, you’re numb. I
went into that numbness.
Deposition of Philippe Cras, 89:12-89:23; Ex. H) (quotations added for clarity)
As established in detail below, this Court should deny Remax’s motion for
Ti.
RGUMENT
Remax’s motion for summary judgment presents three arguments: that (i)
Noonan/Remax was the listing agent, not Mr. Cras’s agent, and that she could not have
owed Mr. Cras any duty; that (ii) there is no evidence that Noonan was “employed” by
Remax; and that (iii) there is no evidence that Noonan’s email was hacked. As shown
below, Remax falls far short of its traditional burden on each of these arguments, and Mr.
Cras has far more than a scintilla of evidence to defeat Remax’s no-evidence points. The
Court should deny Remax’s motion.
Remax’s Conclusory Motion for Summary Judgment Does Not Negate
Remax’s main argument, in support of both its traditional and n
is that Noonan/Remax did not owe Cras a duty as a matter of law because she was not
Mr. Cras’s agent—she was merely the listing agent. The Court should easily reject
Remax’s conclusory argument.
“In determining whether the defendant was under a duty, the court will consider
several interrelated factors, including the risk, foreseeability, and likelihood of injury
weighed against the social utility of the actor's conduct, the magnitude of the burden of
guarding against the injury, and the consequences of placing the burden on the
defendant.” Greater Houston Transp. Co. v. Phillips, 801 S.W.2d 523, 525 (Tex. 1990).
“Of all these factors, foreseeability of the risk is ‘the foremost and dominant
Id. “[QJuestions of duty have turned on whether one party has
knowledge of the risk[.]” Graff v. Beard, 858 S.W.2d 918, 920 (Tex. 1993) (emphasis
In this case, Remax fell far short of its burden to prove, as a matter of law, that it
did not owe a duty to Plaintiff to warn him of recent fraudulent schemes involving
phishing and wire transfers, and how to avoid those schemes. To the contrary, the
evidence shows that Remax did owe such a duty. Each of the factors identified in
Risk and Foreseeability. It was clearly foreseeable to Remax, one of the
nation’s largest realty companies, that people may target participants to a
real estate transaction and give fraudulent wiring instructions. Well before
the transaction giving rise to this case, the National Association of Realtors
and the Federal Trade Commission issued warnings that real estate agents
and home buyers were at a “pervasive” risk of wire fraud and phishing
scam, and even recommended that r
that they will never issue wiring instructions via email. ( Urgent
Warning from National Association of Realtors; Ex. C); ( FTC Article
About Phishing Scams; Ex. B).
Likelihood of Injury. By 2015, fraud and phishing schemes were
“pervasive,” and “fraudsters [were] targeting sellers, buyers,
and title companies participating in a [closing] transaction.” Therefore,
absent any warnings, the likelihood of injury is extremely high. (
Urgent Warning from National Association of Realtors; Ex. C); ( STC
Magnitude of Burden on Remax. The burden of warning participants to a
transaction, like Mr. Cras, is extremely low. As recommended by the
National Association of Realtors and ALTA, STC could have simply issued
written or verbal warnings at the outset of a transaction, warning the
participants of the dangers of wire fraud and phishing schemes, and
warning them never to heed wire instructions sent via email. ( Urgent
realtors to
warn all participants to a real estate transaction up front about fraud and
phishing scams); ( April 2017 ALTA Story About Wire Fraud and
ies should
issue to participants in a real estate closing to fend off wire fraud and
phishing scams).
There Are No Serious Consequences by Putting the Burden on Rema
Putting a duty on Remax to warn participants, at the outset of a transaction,
about wire fraud and phishing schemes, and how to identify and
them, does not create any serious consequences for Remax.
Additionally, as the Texas Supreme Court stated, one of the biggest factors in
determining the existence of a duty is whether a party has “superior knowledge” of a the
risk as compared to the victim. In this case, Remax—as part of one of the nation’s
leading realty companies that handles thousands of real estate transactions per day—no
doubt has “superior knowledge” of the risks of wire fraud and phishing schemes targeting
Accordingly, Remax had a duty to warn Mr. Cras about the prevalence of wire
fraud and phishing schemes, and how to avoid them. At the very least, Remax has fallen
den of conclusively disproving that it had such a burden.
Finally, Remax’s citation to Kubinsky v. Van Zandt Realtors, 811 S.W.2d 711,
(Tex. App.—Fort Worth 1991, writ denied)—which it cites to for the proposition that
Remax did not owe Mr. Cras a duty—is far off point. In that case, a home buyer sued the
listing agent for failing to inform the buyer about recent foundational repairs to the home
that the listing agent did not know about. . at 713. The court summarized the issue on
appeal as: “[W]hether a listing real estate agent has a legal duty to inspect the listed
property for defects over and above asking the sellers if such defects exist.” . at 714.
The court rejected such a broad duty based on the fact that the Texas legislature had
already exhaustively enacted legislation in the area (i.e., by stating that an agent can lose
his or her license by failing to disclose a known latent defect), and concluding that any
expansion of an agent’s duty of disclosure with respect to latent defects “should be left to
Accordingly, Kubinsky stands for a very limited proposition: a listing agent does
not owe a duty to inspect a home and disclose any revealed defects when listing it for
sale. Kubinsky does not carte blanche negate any duty between a listing agent and a
The Court should therefore deny Remax’s traditional and no-evidence motion for
summary judgment. Remax failed to meet its burden to disprove, as a matter of law, the
existence of a duty. Additionally, based on the evidence and arguments above, Mr. Cras
Remax argues that “Noonan . . is not an employee of Wallgood,” and that she is
just an “independent contractor who pays [Remax] to use its services as a broker.” (
Remax’s Motion at 2). Remax, however, submits no evidence to support these
allegations (and thus, to the extent it seeks traditional summary judgment, the motion
Instead, at the end of its motion, Remax turns this point into a no-evidence point,
stating: “There is no evidence that Barbara Noonan was employed or directed by
Wallgood.” . at 4. Contrary to Remax’s argument, there is plenty of evidence, and
certainly more than a scintilla of evidence, that Noonan was an agent of Remax such that
Remax is vicariously liable for Noonan’s negligence.
“Actual authority includes both express and implied authority.” Reliant Energy
Services, Inc. v. Cotton Valley Compression, L.L.C., 336 S.W.3d 764, 783 (Tex. App.—
Houston [1st Dist.] 2011, no pet.). “Express authority is delegated to an agent by words
of the principal that expressly and directly authorize the agent to do an act or series of
acts on behalf of the principal.” “Implied authority is the authority of an agent to do
whatever is necessary and proper to carry out the agent's express powers.” “Actual
authority denotes the authority which a principal (1) intentionally confers upon an agent,
(2) intentionally allows the agent to believe he possesses, or (3) by want of ordinary care
allows the agent to believe himself to possess.” “In order to prove actual authority,
therefore, there must be evidence that either (1) the principal intentionally conferred
authority on another to act as its agent, or (2) the principal intentionally, or by a want of
due care, allowed another to believe that it possessed authority to act as the principal's
In this case, Noonan is a realtor whose “sponsoring broker” is listed with TREC as
Remax. ( Noonan’s TREC License; Ex. P). On the real estate sales contract for the
transaction made the basis of this lawsuit, Barbara Noonan’s listing broker firm was
listed as Remax Associates NE (Remax’s d/b/a), and her “licensed supervisor” was listed
as Buddy Wall, the principal of Remax. ( Residential Real Estate Sales Contract for
5126 Sycamore Creed Drive; Ex. J). Pursuant to 22 Tex. Admin. Code §535.2(a), a
“broker is responsible for the authorized acts of the broker’s salespersons.” Moreover,
under 22 Tex. Admin. Code §535.141(c), “a real estate broker is responsible for all acts
and conduct performed by a real estate salesperson associated with or acting for the
1 block clearly listed her asso
Accordingly, there is more than a scintilla that Noonan had either actual authority
or apparent authority to act as Remax’s agent. Remax intentionally acted as Noonan’s
employed under Remax.
The Court should deny Remax’s motion for summary judgment.
s Email Account was Hacked.
Ultimately, whether or not Noonan’s email account was “hacked” is a meaningless
inquiry for the purposes of Remax’s motion for summary judgment. Based on the
argument and evidence set forth above, Noonan’s failure to warn is a sufficient basis to
However, there is more than a scintilla of evidence that Noonan’s email account
was the one hacked. First, STC has clearly taken the position that Noonan’s account was
hacked: “Early in the email conversation, an internet hacker hacked into the seller agent
Noonan’s email account and began impersonating her.” ( STC’s Motion for
Summary Judgment at 2). STC has also submitted an affidavit from its Chief
Additionally, Mr. Cras’s email account could not have been the one hacked.
Eventually, the hacker figured out that the STC office at issue in this case uses
Woodforest National Bank in The Woodlands to conduct its business. But this
information is not public information. ( Deposition of STC Escrow Agent Yvonne
Duncan, 50:23-51:12; Ex. I). Moreover, STC had not yet issued the wiring instructions
to Mr. Cras at the time of the spoofed emails. . at 63:9-64:1. Thus, the hacker
have hacked into either STC’s emails or Noonan’s emails to get the necessary
information about the wire instructions. There is, therefore, a genuine issue of material
As to Remax’s Remaining No-Evidence Points, Mr. Cras Easily Add
Remax’s motion for summary judgment primarily focuses on two issues: (i) that
there is no evidence that Remax owed Mr. Cras no duty; and (ii) that there is no evidence
that Noonan was Remax 2gs &, “agent.” Mr. Cras easily refuted these points in sections A and
B above.
At the end of its motion, Remax also throws in more conclusory no-evidence
points, alleging that that “no evidence exists as to the elements of duty, breach of duty,
In Section A above, Mr. Cras submitted more than a scintilla of evidence
d him a duty.
As established in Section A above, and based on the factors identified by the
Texas Supreme Court in , there is ample evidence to show that Remax owed a
duty to Mr. Cras to warn him given the “pervasive” wire fraud and phishing schemes
targeting homebuyers—schemes that often involve fraudulent emails purported to be
from a real estate agent in the transaction. Even the National Association of Realtors
urged all realtors to take proactive steps to prevent these schemes, including:
“Immediately contact[ing] all parties to all your upcoming transactions and inform[ing]
them of the possibility of this fraud.” ( Urgent Warning from National Association of
Accordingly, the Court should deny Remax’s no-evidence motion as to this
There is more than a scintilla of evidence that Remax breached its duty to
It is undisputed that Noonan never issued any warnings whatsoever to Mr. Cras
, or that she would never issue wire instructions
Accordingly, the Court should deny Remax’s no-evidence motion as to this
Naturally, had Remax appropriately warned Mr. Cras of the “pervasive” risk of
fraud and phishing schemes, and that he should never heed emailed wire instructions, he
would not have wired the money to the fraudulent wiring instructions he received from
the fraudulent email. ( Declaration of Philippe Cras; Ex. Q). Thus, Remax’s failure
oss.
Accordingly, the Court should deny Remax’s no-evidence motion as to this
It is undisputed that Mr. Cras wired $250,000 to the fraudulent account, and that
Accordingly, Mr. Cras has adduced more than a scintilla of evidence to support
each element of his negligence claim against Remax. The Court should deny Remax’s
no-evidence motion for summary judgment.
ONCLUSION
Mr. Cras respectfully requests that the Court deny Remax’s traditional and no-
evidence motion for summary judgment, and grant him any further relief to which he is
Respectfully subm
MAHENDRU, P.C.
By
Ashish Mahendru
Texas Bar No. 00796980
Darren Braun
Texas Bar No. 24082267
639 Heights Boulevard
Houston, Texas 77007
dbraun@thelitigationgroup.com
ATTORNEYS FOR PLAINTIFF
I hereby certify that a true and correct copy of the foregoing instrument has been
provided to all counsel of record in accordance with the applicable Texas Rules of Civil
Via Email:
Scott Breitenwischer scott breitenwischer@roystonlaw.com
Maulik P. Shah maulik.shah@roystonlaw.com
LLP
Sam A. Houston
LAWATER OUSTON
Ashish Mahendru
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PHILIPPE CRAS, HARRIS COUNTY, TEXAS STEWART TITLE COMPANY and WALLGOOD, L.L.C., Defendants. § 234 JUDICIAL DISTRICT PLAINTIFF’S RESPONSE TO DEFENDANT WALLGOOD’S MOTION FOR TO THE HONORABLE JUDGE LAUREN REEDER: Plaintiff Philippe Cras (“Cras”) files this Response to Defendant Wallgood, L.L.C. d/b/a Remax’s Traditional and No Evidence Motion for Summary Judgment and would In this case, Mr. Cras attempted to fulfill his lifelong dream of buying his daughter her very own home. Instead, he was defrauded into wiring his life savings—$250,000— to a fraudster who emailed fake wiring instructions from a spoofed email account. Barbara Noonan, a Remax agent, was the listing agent for the transaction whose email account was spoofed. The Court should now deny Remax’s conclusory and threadbare motion for summary judgment. Remax has fallen far short of its burden of conclusively negating that it owed a duty of care to Mr. Cras. To the contrary, the evidence shows that realtors, like title companies, were well aware of the pervasive and ongoing threat of wire fraud and phishing schemes targeting home buyers like Mr. Cras and, therefore, owed a duty to warn them of that threat. Even the National Association of Realtors issued an “urgent warning” urging realtors to warn all transaction participants about the threat of wire fraud and phishing schemes. Noonan an Moreover, despite Remax’s conclusory arguments to the contrary, the evidence shows that Noonan was the agent of Remax, meaning that Remax can be liable for her negligence. Remax was Noonan’s “sponsoring broker,” and she did business under the Remax name. The Court should also deny Remax’s no-evidence points. As established below, Mr. Cras has adduced more than a scintilla of evidence to support each element of his IL. ACKGROUND Since at Least 2015, Title Companies and Real Estate Companies Across the Nation—Including STC—Become Embroiled in a Massive Amount of Fr Since at least 2015, real estate closing transactions have been plagued by wire fraud and phishing schemes. The American Land Title Association (“ALTA”)—a nationwide special-interest organization for title companies—described these phishing Criminals begin the wire fraud process way before the attempted theft occurs. Most often, they begin with a common social engineering technique called phishing. This can take the form of email messages, website forms or phone calls to fraudulently obtain private information. Through seemingly innocuous communication, criminals trick users into inputting their information or clicking a link that allows hackers to steal login and password information. Once hackers gain access to an email account, they will monitor messages to find someone in the process of buying a home. Hacks can come from various parties involved in a transaction, including real estate agents, title companies, attorneys or consumers. Criminals then use the stole information to email fraudulent wire transfer instructions dressed up to appear as if they came from the victim. To this end, criminals will use either the victim’s actual email account (which they may actually control) April 2017 ALTA Story About Wire Fraud and Phishing Scams; Ex. Given the ever-increasing threat of phishing scams, ALTA issued a warning to Title professionals are encouraged to remind clients about the risk of wire fraud, especially during later phases of the transaction. To combat this Put consumer warnings on websites and communications Used secured email communications Sent notices to consumers and real estate agents informing them that the title companies’ wire instructions will never change during the transaction Called homebuyers and real estate agents on a known number Verified account holder information with the receiving bank ALTA further urged title professionals to put warnings in their email signature lines, Be aware! Online banking fraud is on the rise. If you receive an email containing WIRE TRANSFER INSTRUCTIONS call us immediately to verify the information prior to sending Due to increased fraud, buyers, sellers and lenders should confirm all wiring instructions by phone directly with our WARNING! WIRE FRAUD ADVISORY: Wire fraud and email hacking/phishing attacks are on the increase! If you have an escrow or closing transaction with us and you receive an email containing Wire Transfer Instructions, DO NOT RESPOND TO THE EMAIL! Instead, call your escrow officer/closer immediately, using previously known contact information and NOT information provided in the email, to verify the information prior to sending funds. Title Companies were not the only ones warned about phishing schemes. As the number of wire fraud schemes rose in 2015 and 2016, the Federal Trade Commission March 2016 that: Hackers have been breaking into some consumers’ and real estate professionals’ email accounts to get information about upcoming real estate transactions. After figuring out the closing dates, the hacker sends an email to the buyer, posing as the real estate professional or title company. The bogus email says there has been a last minute change to the wir instructions, and tells the buyer to wire closing costs to a different account. But it’s the scammers account. If the buyer takes the bait, their bank account could be cleared out in a matter of minutes. Often, that’s money STOP. Email is not a secure wayt real estate professional or title company should know that. Phishing Scams; Ex. B). In December 15, 2015, the National Association of Realtors issued an “Urgent Urgent Release from National Association of Realtors; Ex. C) (emphasis added). The National Association of Realtors urged all realtors to take proactive steps to prevent wire fraud including: “Immediately contactjing] all parties to all your upcoming transactions and informing] them of the possibility of this fraud.” (emphasis added). In apparent recognition of the risk of fraud and phishing scams, Ms. Barbara Noonan, Remax’s agent, testified that wire instructions should Given the Pervasive Nature of Wire Fraud and Phishing Schemes Targeting STC, like ATLA and other title companies across the nation, was intimately aware of the massive increase in phishing schemes in the mid 2010’s. On March 24, 2016—six months before Plaintiff was defrauded—STC’s Genady Vishnevetsky (who submitted an affidavit in support of STC’s motion for summary judgment) published a blog article on STC’s website warning of the pervasive nature of wire fraud and phishing schemes This post may affect many of you not only professionally, but a personally. JP Morgan estimated 27 percent of wire transfers in 2014 were affected by either attempted or actual fraud. Imagine the worst: the funds in the transaction did not transfer from buyer to rightful seller and are now The primary attribute of any wire fraud scam is a sense of urgency. Phishing employs an email that frequently appears to be urgent and to be coming from someone with authority, directed to someone else who is responsible for wiring transactions within the organization. Depending on the level of sophistication, the attacker’s email may look very genuine (using corporate logos, style sheets, signatures, etc.). Unfortunately, the more authentic the fraudulent email appears, the more it indicates that some corporate email or system was compromised. In our industry, fraudsters are targeting sellers, buyers, REALTORS® and title companies participating in a transaction. While there are many different ways for an impostor to commit a fraud, there are two most common ways they get it done. Both are the result of a user’s computer 2016 STC Blog About Phishing Scams; Ex. E). STC promoted Vishnevetsky with on its twitter page, tweeting “[d]o you know the risks of wire fraud? Stewart’s CISO [Chief Information Security Officer], Genady Vishnevetsky, provides insights to protect your data.” ( STC’s March 25, 2016 Tweet Promoting Blog About Wire Fraud and Even before STC’s CISO published blog entries about the prevalence of phishing scams—and the risk that “people’s life savings” will be taken away—STC had already implemented a “strict policy” internally in order to combat the prevalence of phishing scams. In December 2015, STC’s president, general counsel, chief risk officer, and vice present of escrow account issued a joint bulletin to all of STC’s escrow employees Wire transfers have become one of the most prevalent targets for fraud. There are various points of compromise, all of which can result in a wire initiation that transfers funds fraudulently to thieves. The result can be catastrophic to our company in terms of monetary loss and damage to reputation. We have experienced a number of these attempts in the last year and they increase every week. As a result, strict processes must be put in place to protect against these types of fraud. The policy below sets forth the required security process and procedures applicable to wire instructions and In September 2016, Mr. Cras Became a Customer of STC for a Real Estate Closing. STC Never Warned Him About the Prevalence of Ongoing Phishing Schemes, and Mr. Cras Becomes a Victim of the Exact Same Phishi out and Loses $250,000. Mr. Cras is a native of Belgium. ( Deposition of Philippe Cras; 7:14-7:25; Ex. H). While Mr. Cras has bought and sold real estate before, he is not a “real estate developer” as STC claims. Instead, he owned and operated a single hotel as his primary occupation since coming the United States. . at 18:1-18:12. Mr. Cras’s “development” experience came from building small, European-sized condominiums in Europe from the mid-80’s to the mid-90’s, as well as purchasing and/or selling approximately five homes during this time period and a few more homes throughout his lif at 13:11-15:13. It had always been Mr. Cras’s dream to someday buy a home for his daughter, and - at 91:2-91:9. In 2016, after months of searching, Mr. Cras’s daughter finally found her dream home in Kingwood, Texas, only a few houses away from where Mr. Cras lived. Mr. Cras signed the contract to purchase the home. Barbara Noonan, a Remax realtor, represented the seller during the transaction. ( Residential Real Estate Contract for 5126 It is undisputed Mr. Cras and the seller hired STC to act as the title company and escrow agent for the transaction. . at §5 (designating STC as “escrow agent”). STC— despite being aware of rampant fraud and phishing schemes targeting home purchasers While STC callously chides Mr. Cras for falling for the scam despite having participated in real estate purchases years before, it admits that these sort of scams only started happening in recent years. Deposition of Yvonne Duncan, 33:3-33:12; Ex. I). Thus, it is unclear why Mr. Cras should have been on the lookout for a scam that he did not know existed (but which STC was clearly aware of). during the closing process—did_not_issue_any warnings to the parties about the prevalence of wire fraud, nor did they issue any warnings or instructions to Mr. Cras on how to identify and avoid wire fraud and phishing schem Incredibly, Yvonne Duncan, STC’s escrow agent for the transaction, testified that she had not even “heard” about the ongoing scams prior to Mr. Cras’s closing even though STC’s own Chief Information Security Officer had posted warnings about it six months prior. ( Unfortunately, in the absence of any warning from STC, Mr. Cras fell victim to the exact same phishing scheme that STC was intimately aware of, and that its own Chief Information Security Office had warned about. A criminal named Brian Herbert gained access to Barbara Noonan’s email account, monitored the parties’ communications, and then—when the time was right—began emailing Mr. Cras from a slightly different, spoofed email account—noonanbarbara@hotmail, instead of banoonan@earthlink.net. onan Email Address; Ex. K with Noonan’s Correct Email Address; Ex. L). Both email addresses, however, displayed as “Barbara Noonan.” On September 9, 2016, at 7:33 a.m., Cras received an email from the fraudulent Noonan email account stating: I hope you had a nice flight back home. Our CDA has arrived and sent to title company. This means we are in a good shape to close on time. Now what we need is the wire to come through today to avoid us extending the [wiring information not shown] Do send a wiring confirmation to my email when the transfer has Importantly, this email—unbeknownst to Cras—contained three of the most tell tale signs of a wire fraud and phishing scheme that STC knew about: (1) a fraudulent email address that slightly differed from the correct email ( STC Cyber Security Presentation at 000489; Ex. M) (describing how phishing schemes make use of slightly- altered email addresses unlikely to be noticed by victim); ( STC’s 2016 Blog About Wire Fraud and Phishing Scams; Ex. E) (warning that the “the attacker’s [fake] email [address] may look very genuine”); (2) the sense of urgency to make a transfer soon, (“The primary attribute of any wire fraud scam is a sense of urgency . . . [p]hishing employs an email that frequently appears to be urgent[.]; and (3) wire instructions that changed at the last minute, (stating that the scammer “patiently waits for a closing date or completion of a transaction to make a very last minute move — chang[ing] wiring instruction. No one wants to delay a business deal; that’s what criminals are counting on.”). Mr. Cras may have instantly recognized this email as a scam—if only STC had bothered to warn him to watch On September 9, 2016, at 9:52 a.m. Cras emailed STC and let them know that he See you Monday at 10:00 a.m. [fo to Woodforest bank today. It will be after 3:00 p.m. since I just returned from Europe. I am swamped with meetings until 3:00 p.m., but will take Cras Email to STC About Wiring Money; Ex. N). Importantly, at the time Cra: sent_his email, STC had not given Cras a settlement_statement_or any wiring , and thus should have immediately realized that Cras had been given fraudulent wiring instructions. ( Deposition of Yvonne Duncan, 63:9-64:1; Ex. 1). Of course, based on Mr. Duncan’s other testimony, STC had apparently not alerted its escrow agents (who are in the best position to warn parties) to the pervasive ongoing wire fraud and phishing schemes. Thus, no one from STC warned or stopped Mr. Cras, though it was STC’s internal policy to have their customers call and confirm account numbers before wiring any funds Id. at 38:10-38:22 (“If we knew a customer was gonna send a wire we had to confirm. They needed to call us and confirm account numbers.”). Inexplicably, STC failed to follow its own internal procedure by not telling Mr. Cras to By 11:30 a.m., having not been stopped or warned by STC, Mr. Cras completed Linda, I transferred the $250,000. It is 11:30 [a.m.]. Thanks for ordering Cras Email to STC Confirming that Wire Had Been Sent; Ex. O). Still, STC did not alert or warn Cras that he had been given false instructions. Nor did STC bother to The settlement statement, which tells the seller how much he or she needs to wire (the “cash to close”), was not sent to Cras until the next week. The closing was originally set for Monday, September 12, 2016, but was moved by amendment to September 16, 2016. confirm whether any wire was actually pending. Instead, September 9 , 10 , 11 , 12 On September 16, 2016, Mr. Cras, his daughter, and his wife appeared at STC’s Kingwood office for the closing. Mr. Cras, at his deposition, described the moment that After all the [closing] documents were signed . . . Ms. Duncan escrow agent] said, “all I need is the money.” And I said, “well, I wired it to you.” And she went, like, “oh, not again.” And my wife was there, my daughter. And it was supposed to be a festive moment, right, I supposed to be a champagne kind of moment. And I —you know how it is when you’re told somebody died, somebody close to you, you’re numb. I went into that numbness. Deposition of Philippe Cras, 89:12-89:23; Ex. H) (quotations added for clarity) As established in detail below, this Court should deny Remax’s motion for Ti. RGUMENT Remax’s motion for summary judgment presents three arguments: that (i) Noonan/Remax was the listing agent, not Mr. Cras’s agent, and that she could not have owed Mr. Cras any duty; that (ii) there is no evidence that Noonan was “employed” by Remax; and that (iii) there is no evidence that Noonan’s email was hacked. As shown below, Remax falls far short of its traditional burden on each of these arguments, and Mr. Cras has far more than a scintilla of evidence to defeat Remax’s no-evidence points. The Court should deny Remax’s motion. Remax’s Conclusory Motion for Summary Judgment Does Not Negate Remax’s main argument, in support of both its traditional and n is that Noonan/Remax did not owe Cras a duty as a matter of law because she was not Mr. Cras’s agent—she was merely the listing agent. The Court should easily reject Remax’s conclusory argument. “In determining whether the defendant was under a duty, the court will consider several interrelated factors, including the risk, foreseeability, and likelihood of injury weighed against the social utility of the actor's conduct, the magnitude of the burden of guarding against the injury, and the consequences of placing the burden on the defendant.” Greater Houston Transp. Co. v. Phillips, 801 S.W.2d 523, 525 (Tex. 1990). “Of all these factors, foreseeability of the risk is ‘the foremost and dominant Id. “[QJuestions of duty have turned on whether one party has knowledge of the risk[.]” Graff v. Beard, 858 S.W.2d 918, 920 (Tex. 1993) (emphasis In this case, Remax fell far short of its burden to prove, as a matter of law, that it did not owe a duty to Plaintiff to warn him of recent fraudulent schemes involving phishing and wire transfers, and how to avoid those schemes. To the contrary, the evidence shows that Remax did owe such a duty. Each of the factors identified in Risk and Foreseeability. It was clearly foreseeable to Remax, one of the nation’s largest realty companies, that people may target participants to a real estate transaction and give fraudulent wiring instructions. Well before the transaction giving rise to this case, the National Association of Realtors and the Federal Trade Commission issued warnings that real estate agents and home buyers were at a “pervasive” risk of wire fraud and phishing scam, and even recommended that r that they will never issue wiring instructions via email. ( Urgent Warning from National Association of Realtors; Ex. C); ( FTC Article About Phishing Scams; Ex. B). Likelihood of Injury. By 2015, fraud and phishing schemes were “pervasive,” and “fraudsters [were] targeting sellers, buyers, and title companies participating in a [closing] transaction.” Therefore, absent any warnings, the likelihood of injury is extremely high. ( Urgent Warning from National Association of Realtors; Ex. C); ( STC Magnitude of Burden on Remax. The burden of warning participants to a transaction, like Mr. Cras, is extremely low. As recommended by the National Association of Realtors and ALTA, STC could have simply issued written or verbal warnings at the outset of a transaction, warning the participants of the dangers of wire fraud and phishing schemes, and warning them never to heed wire instructions sent via email. ( Urgent realtors to warn all participants to a real estate transaction up front about fraud and phishing scams); ( April 2017 ALTA Story About Wire Fraud and ies should issue to participants in a real estate closing to fend off wire fraud and phishing scams). There Are No Serious Consequences by Putting the Burden on Rema Putting a duty on Remax to warn participants, at the outset of a transaction, about wire fraud and phishing schemes, and how to identify and them, does not create any serious consequences for Remax. Additionally, as the Texas Supreme Court stated, one of the biggest factors in determining the existence of a duty is whether a party has “superior knowledge” of a the risk as compared to the victim. In this case, Remax—as part of one of the nation’s leading realty companies that handles thousands of real estate transactions per day—no doubt has “superior knowledge” of the risks of wire fraud and phishing schemes targeting Accordingly, Remax had a duty to warn Mr. Cras about the prevalence of wire fraud and phishing schemes, and how to avoid them. At the very least, Remax has fallen den of conclusively disproving that it had such a burden. Finally, Remax’s citation to Kubinsky v. Van Zandt Realtors, 811 S.W.2d 711, (Tex. App.—Fort Worth 1991, writ denied)—which it cites to for the proposition that Remax did not owe Mr. Cras a duty—is far off point. In that case, a home buyer sued the listing agent for failing to inform the buyer about recent foundational repairs to the home that the listing agent did not know about. . at 713. The court summarized the issue on appeal as: “[W]hether a listing real estate agent has a legal duty to inspect the listed property for defects over and above asking the sellers if such defects exist.” . at 714. The court rejected such a broad duty based on the fact that the Texas legislature had already exhaustively enacted legislation in the area (i.e., by stating that an agent can lose his or her license by failing to disclose a known latent defect), and concluding that any expansion of an agent’s duty of disclosure with respect to latent defects “should be left to Accordingly, Kubinsky stands for a very limited proposition: a listing agent does not owe a duty to inspect a home and disclose any revealed defects when listing it for sale. Kubinsky does not carte blanche negate any duty between a listing agent and a The Court should therefore deny Remax’s traditional and no-evidence motion for summary judgment. Remax failed to meet its burden to disprove, as a matter of law, the existence of a duty. Additionally, based on the evidence and arguments above, Mr. Cras Remax argues that “Noonan . . is not an employee of Wallgood,” and that she is just an “independent contractor who pays [Remax] to use its services as a broker.” ( Remax’s Motion at 2). Remax, however, submits no evidence to support these allegations (and thus, to the extent it seeks traditional summary judgment, the motion Instead, at the end of its motion, Remax turns this point into a no-evidence point, stating: “There is no evidence that Barbara Noonan was employed or directed by Wallgood.” . at 4. Contrary to Remax’s argument, there is plenty of evidence, and certainly more than a scintilla of evidence, that Noonan was an agent of Remax such that Remax is vicariously liable for Noonan’s negligence. “Actual authority includes both express and implied authority.” Reliant Energy Services, Inc. v. Cotton Valley Compression, L.L.C., 336 S.W.3d 764, 783 (Tex. App.— Houston [1st Dist.] 2011, no pet.). “Express authority is delegated to an agent by words of the principal that expressly and directly authorize the agent to do an act or series of acts on behalf of the principal.” “Implied authority is the authority of an agent to do whatever is necessary and proper to carry out the agent's express powers.” “Actual authority denotes the authority which a principal (1) intentionally confers upon an agent, (2) intentionally allows the agent to believe he possesses, or (3) by want of ordinary care allows the agent to believe himself to possess.” “In order to prove actual authority, therefore, there must be evidence that either (1) the principal intentionally conferred authority on another to act as its agent, or (2) the principal intentionally, or by a want of due care, allowed another to believe that it possessed authority to act as the principal's In this case, Noonan is a realtor whose “sponsoring broker” is listed with TREC as Remax. ( Noonan’s TREC License; Ex. P). On the real estate sales contract for the transaction made the basis of this lawsuit, Barbara Noonan’s listing broker firm was listed as Remax Associates NE (Remax’s d/b/a), and her “licensed supervisor” was listed as Buddy Wall, the principal of Remax. ( Residential Real Estate Sales Contract for 5126 Sycamore Creed Drive; Ex. J). Pursuant to 22 Tex. Admin. Code §535.2(a), a “broker is responsible for the authorized acts of the broker’s salespersons.” Moreover, under 22 Tex. Admin. Code §535.141(c), “a real estate broker is responsible for all acts and conduct performed by a real estate salesperson associated with or acting for the 1 block clearly listed her asso Accordingly, there is more than a scintilla that Noonan had either actual authority or apparent authority to act as Remax’s agent. Remax intentionally acted as Noonan’s employed under Remax. The Court should deny Remax’s motion for summary judgment. s Email Account was Hacked. Ultimately, whether or not Noonan’s email account was “hacked” is a meaningless inquiry for the purposes of Remax’s motion for summary judgment. Based on the argument and evidence set forth above, Noonan’s failure to warn is a sufficient basis to However, there is more than a scintilla of evidence that Noonan’s email account was the one hacked. First, STC has clearly taken the position that Noonan’s account was hacked: “Early in the email conversation, an internet hacker hacked into the seller agent Noonan’s email account and began impersonating her.” ( STC’s Motion for Summary Judgment at 2). STC has also submitted an affidavit from its Chief Additionally, Mr. Cras’s email account could not have been the one hacked. Eventually, the hacker figured out that the STC office at issue in this case uses Woodforest National Bank in The Woodlands to conduct its business. But this information is not public information. ( Deposition of STC Escrow Agent Yvonne Duncan, 50:23-51:12; Ex. I). Moreover, STC had not yet issued the wiring instructions to Mr. Cras at the time of the spoofed emails. . at 63:9-64:1. Thus, the hacker have hacked into either STC’s emails or Noonan’s emails to get the necessary information about the wire instructions. There is, therefore, a genuine issue of material As to Remax’s Remaining No-Evidence Points, Mr. Cras Easily Add Remax’s motion for summary judgment primarily focuses on two issues: (i) that there is no evidence that Remax owed Mr. Cras no duty; and (ii) that there is no evidence that Noonan was Remax 2gs &, “agent.” Mr. Cras easily refuted these points in sections A and B above. At the end of its motion, Remax also throws in more conclusory no-evidence points, alleging that that “no evidence exists as to the elements of duty, breach of duty, In Section A above, Mr. Cras submitted more than a scintilla of evidence d him a duty. As established in Section A above, and based on the factors identified by the Texas Supreme Court in , there is ample evidence to show that Remax owed a duty to Mr. Cras to warn him given the “pervasive” wire fraud and phishing schemes targeting homebuyers—schemes that often involve fraudulent emails purported to be from a real estate agent in the transaction. Even the National Association of Realtors urged all realtors to take proactive steps to prevent these schemes, including: “Immediately contact[ing] all parties to all your upcoming transactions and inform[ing] them of the possibility of this fraud.” ( Urgent Warning from National Association of Accordingly, the Court should deny Remax’s no-evidence motion as to this There is more than a scintilla of evidence that Remax breached its duty to It is undisputed that Noonan never issued any warnings whatsoever to Mr. Cras , or that she would never issue wire instructions Accordingly, the Court should deny Remax’s no-evidence motion as to this Naturally, had Remax appropriately warned Mr. Cras of the “pervasive” risk of fraud and phishing schemes, and that he should never heed emailed wire instructions, he would not have wired the money to the fraudulent wiring instructions he received from the fraudulent email. ( Declaration of Philippe Cras; Ex. Q). Thus, Remax’s failure oss. Accordingly, the Court should deny Remax’s no-evidence motion as to this It is undisputed that Mr. Cras wired $250,000 to the fraudulent account, and that Accordingly, Mr. Cras has adduced more than a scintilla of evidence to support each element of his negligence claim against Remax. The Court should deny Remax’s no-evidence motion for summary judgment. ONCLUSION Mr. Cras respectfully requests that the Court deny Remax’s traditional and no- evidence motion for summary judgment, and grant him any further relief to which he is Respectfully subm MAHENDRU, P.C. By Ashish Mahendru Texas Bar No. 00796980 Darren Braun Texas Bar No. 24082267 639 Heights Boulevard Houston, Texas 77007 dbraun@thelitigationgroup.com ATTORNEYS FOR PLAINTIFF I hereby certify that a true and correct copy of the foregoing instrument has been provided to all counsel of record in accordance with the applicable Texas Rules of Civil Via Email: Scott Breitenwischer scott breitenwischer@roystonlaw.com Maulik P. Shah maulik.shah@roystonlaw.com LLP Sam A. Houston LAWATER OUSTON Ashish Mahendru