Last month, Jim Duncey, the majority owner and face of Duncey’s Caps, Inc., was involved in a car accident and arrested for DWI.   Facing a PR crisis Duncey’s board of directors called an emergency meeting.  The board implemented its crisis plan, issued a statement condemning driving while intoxicated, suspended Duncey, ordered him to attend rehabilitation, and made a $100,000 donation to MADD. 

While the company survived the initial PR crisis, its bottom line did not.  Retail sales during the following quarter were down 20%.  One of the company’s major commercial customers also terminated its contract that produced $3 million in revenue annually.  To make matters worse, the board’s private investigator discovered that Duncey had previously been arrested for DWI three years earlier while on vacation in another state, but had managed to keep it quiet.  Does the company have any legal remedies against Duncey on top of terminating him?  Should the company seek those remedies? Continue Reading The Calm After the PR Storm: Recovering Damages from the Offender

Drone with CameraTrying to avoid the sweltering heat, “Uncle Jesse” Duke was in the garage working on his moonshine operation when he heard a loud shriek in the backyard. He ran to the back to find his niece, Daisy, sunbathing by the pool. Daisy shouted, “That drone keeps hovering over the pool area looking toward me. Do something about it Uncle Jesse!” Uncle Jesse quickly ran back to the garage, grabbed his trusty shotgun, and blew the drone out of the sky. An hour later Sheriff Coltrane showed up at Jesse’s house and asked, “Jesse, did you shoot a drone?” Jesse responded, “You’re durn right I did.” Sheriff Coltrane replied, “Well Jesse, that was Boss Hogg’s $2,000 drone you destroyed. I’m sorry, but I’m gonna have to arrest you.” Jesse said, “I didn’t commit no crime Sheriff. It’s my American right to defend my property.” Is Jesse right?

Can You Lawfully Shoot Down a Drone over Your Property?

Two reported cases in New Jersey and Kentucky deal with shooting drones flying over private property. Both times the shooters were charged with criminal mischief and related misdemeanors. As a starting point, your homeowner’s property is both the dirt and your improvements, and also a reasonable amount of airspace necessary to utilize your property. While you can’t complain that the American Airlines flight at 30,000 feet is trespassing on your property, a drone that’s only 200 feet off the ground…? Well, that’s probably a different story…

Earlier Tilting articles mentioned that each state has a “castle doctrine.” Although it varies by state, the “Castle Doctrine” generally allows homeowners to protect themselves, and in some cases their property, with force.   Beyond the “Castle Doctrine” Texas has another law that permits a property owner to use “force” when the property owner reasonably believes it is necessary to prevent a trespass on their land.   Using that Texas statute, the conduct may be justified and criminal liability may be avoided where the homeowner used “deadly force” (i.e., a gun) to shoot down the drone.

What about civil liability?

The homeowner’s action may also be justified against civil liability if the homeowner can prove: (1) the trespassing Drone was not privileged to be above the homeowner’s property (such as to avoid an emergency); (2) the homeowner reasonably believed the trespass by the Drone can only be prevented or terminated by the force used; and (3) the homeowner either requested the trespass cease, or reasonably believed that request would be useless or that substantial harm would be done before the request can be made. But there is no clear cut answer at this time, and these defenses would be decided by a court or jury.

Tilting the Scales in Your Favor

While no one wants their privacy intruded upon, we do not recommend shooting a drone out of the sky. While you might have good legal arguments to justify your actions – and probably have a jury’s sympathy – it will still be a costly process, particularly when you may be one of the first cases of this kind in the state. Obviously, your liability exposure is compounded if you happen to miss the drone and hit another person or their property.

Having said that the drone owner does not necessarily get away scot-free. In 2013 the Texas Legislature passed a law that creates a private cause of action against the drone owner or user for using a drone to capture an image of the property owner (or tenant) or their property and allows the property owner to recover $5,000 for all of the images captured during each trespass, as well as court costs and attorney’s fees. The drone owner or user may also be liable to the homeowner for trespassing and for one of the torts of invasion of privacy (check out our other article this month “Can You Videotape Someone Else’s Conversation”). Next month we’ll explore this issue from the drone owner’s perspective, including federal regulations and recommendations for flying unmanned drones.

Recently we’ve discussed how the foreseeability of the potential harm caused by a person’s actions can make them liable for negligence. Recent horrific events in Garland and Waco, Texas bring up a related question: can a business owner ever have a duty to protect his customers from the wrongful – even criminal – acts of another? The answer is yes – if those criminal acts are foreseeable.

Recently, the Twin Peaks restaurant in Waco, Texas became a hang-out for “outlaw” motorcycle clubs. The Twin Peaks management had encouraged the bikers to patronize the restaurant, going so far as to hold bike events for them. The Waco police repeatedly requested that the restaurant eject the bikers or stop allowing them to hold events on the premises, citing the strong likelihood of intergang violence; however, the managers refused.

Just a few days ago, the police warning proved prophetic as several biker gangs started a brawl that turned into a massive gunfight, leaving nine bikers dead, more wounded, and bullet-riddled cars throughout the parking lot. Luckily, no citizens or police officers were wounded – but if they had been, could they have held the Twin Peaks restaurant liable for their injuries, even though the injuries were actually caused by the bikers?

Yes, if the crime is foreseeable. Generally in Texas, a business owner is not liable for injuries caused by the criminal acts of a third party. However, the Texas Supreme Court has held that there is an exception when “the risk of a crime [is] sufficiently unreasonable and foreseeable to justify imposing a duty on [business owners] to protect [their customers] while they are on the [business owner’s] property.” Generally in Texas, the courts analyze previous acts of crime on the premises and weigh the proximity, publicity, recency, frequency, and similarity of the prior crimes to determine if the crime in question was foreseeable. In this case, there have been no reports of similar prior crimes in the past. However, according to the police the restaurant owners were warned of the possibility of a violent clash of biker gangs in advance. If a person were injured during the melee, they could have good reason to claim that the crime was foreseeable – and that the restaurant owners were liable for their injuries.

Tilting the Scales in Your Favor. So what should business owners do to prevent being held liable for the criminal acts of third parties on their premises? Luckily for them, it is generally difficult for a plaintiff to establish that criminal activity is foreseeable, and Texas appellate courts are quick to second guess juries’ determinations of foreseeability. Nevertheless, the prudent business owner should take reasonable steps to prevent criminal activity on their premises when it is routine or when the police give an express warning of future criminal acts.

Update! Not surprisingly, a lawsuit has already been filed as a result of the shootout in Waco. One of the Twin Peaks restaurant’s neighboring business sued the Twin Peaks management and national franchisor alleging that the management failed to “exercise ordinary care and operate its place of business in a reasonable and prudent manner.” The suit seeks damages including the profits lost while the neighboring restaurant was closed during the police investigation and for damage to its property. The suit also alleges that the franchisee management is the “agent” for the national franchisor, rendering the national franchisor liable to the same extent as the franchisee. Alleged negligent acts include the negligent hiring of the independent franchisor’s management, failing to heed warning from the police about motorcycle related violence, and failing to supervise and control patrons.

It will be interesting to follow the course of this litigation; the legal theories asserted by the plaintiff appear to be novel and in some cases contrary to existing Texas law. Typically, a business owner’s duty to prevent criminal acts is limited to its patrons; this case seeks to greatly expand that doctrine. Time will tell if the courts agree that these claims have merit.


divorceKnowing that his old high school friend Iman Dedbeet had just been taken to the cleaners by his ex-wife Goldilocks in a nasty divorce, Johnny Clueless decided to help Iman out by hiring him as his general sales manager at Clueless Automotive. Johnny knew that Goldilocks got full custody of Dedbeet’s kids and that Dedbeet owes Goldilocks back child support. Nevertheless, when Clueless handed Dedbeet the IRS Form W-4 to complete, Dedbeet urged Clueless to make him an independent contractor and pleaded, “You know what I need Johnny. Goldi doesn’t deserve another penny.” Relenting, Clueless classifies Dedbeet as a 1099 independent contractor. Is Clueless getting taken for a ride?

Employers Must Report New Hires. Within 20 days of hiring a new employee Employers must report the new hires to the Texas Attorney General’s Child Support Division. However, this requirement is limited to new personnel classified as employees. An employer is not required to report new hire independent contractors, allowing new hires to avoid having child support withheld from their paycheck.

Employers Are Liable for Falsely Reporting a New Hire’s Status. Johnny Clueless should know, however, that Texas law subjects employers to a $500 fine for conspiring with a new hire to fail to submit a new hire report, or submit a false report. By agreeing to Dedbeet’s pleas Clueless risks sharing Iman Dedbeet’s responsibilities because he knew that his new hire wants to avoid the possibility of having child support withheld.

Proposed Legislation Would Remove Loophole Senate Bill 1727 currently before the Texas Legislature would add “independent contractor” to the definition of “employee” in Texas and close the loophole used by some to avoid child support withholding.

Tax Issues Both Clueless and Dedbeet also create tax issues by misclassifying Dedbeet as an independent contractor. Clueless will not pay FICA. Instead, Dedbeet will have to pay the Self Employment tax on a quarterly basis.

Tilting the Scales in Your Favor Although misclassifying employees may not look overly penal, it will cause a substantial disruption in your business when you have to deal with the Attorney General’s investigation and, is it worth it? It’s easier (and the law) to classify the employee correctly before the hire for any number of reasons. If a new hire asks to be classified as an independent contractor, and particularly if you know the hire owes child support, make sure that the hire is truly serving as an independent contractor – which means the hire provides all of their own tools and equipment, and has complete control over the manner in which it performs tasks.

U. Hyde Meah’s employer required him to agree contractually that top secret information he reviewed as a technical contractor for the United States government would not be disclosed. Later Hyde leaked details of several top-secret mass surveillance programs to the press. Hyde sees himself as a hero and a whistleblower. The U.S. government views him as a common thief who stole U.S. property knowingly to use against the government, and intends to prosecute Hyde for espionage and, less likely, treason. Claiming that deportation to the U.S. would certainly result in his torture and execution, U. Hyde Meah is actively seeking asylum outside the U.S. Can Hyde avoid extradition if he secures asylum? Is he likely to get asylum?

Political Asylum

The good news for Hyde? If a country does grant him asylum status he will be protected from being extradited. The bad news? Although each country determines for itself whether he qualifies, it’s likely that he does not satisfy the internationally recognized benchmark legal requirements for asylum. Moreover, Hyde is a political hot potato with not much to offer.

Punishable Crime or Political Opinion?

Asylum is not as simple as landing in a foreign country and asking for special status and permanent residency just because you did something that was a crime at home but is legal elsewhere. If so, Canada would be overflowing with American drug users seeking to escape criminal charges. If Hyde is being persecuted for his political opinion, then the principle of non-refoulement established by the 1951 United Nations Convention Relating to the Status of Refugees governs him as a refugee. Ratified by most countries, including the United States, the principle expressly forbids a country from expelling or returning “a refugee…to the frontiers of territories where his life or freedom would be threatened on account of his race, religion, nationality, or membership in  a particular social group or political opinion.”

Was Hyde’s conduct a crime – theft of property, espionage or treason – or just being a whistleblower complaining about conduct (invasion of privacy) that qualifies Meah as “membership of a particular social group or political opinion”? Plain old garden variety crime, or political opinion? Prosecution or persecution? Whistleblowers must prove that they are being persecuted, and prosecution for disclosing classified information is not, by definition, persecution. While opinion may have truly motivated Hyde, at the trial of his criminal case the prosecutor would argue that the information leaks, not his personal beliefs, drove his conduct. (Put another way, if someone sabotaged a U.S. drone base and was indicted for destruction of property, claiming persecution because of an opposition to drones would not likely prevail.)

Yet, distinguishing between a prosecution motivated by legitimate government interests in maintaining state secrets and one that simply seeks to retaliate against someone who has exposed wrongdoing is a challenge. Maybe the real question is whether the electronic eavesdropping programs that Hyde Meah revealed do indeed look like a gross abuse of human rights.  Many think so. Accordingly, if one accepts the premise that Hyde brought to light some very serious government misconduct, then his asylum claim might look more like persecution for a political opinion.

Nowhere to Hide

The bottom line? U. Hyde Meah is neither sympathetic nor politically appealing. Countries are free to grant residence, citizenship, and other forms of protection to anyone they want, for whatever reason they want, and political reasons can play a role. So even if Hyde Meah does not qualify for asylum under the normal rules, countries could give him asylum if they wanted to. Hyde’s problem is that these countries wouldn’t gain anything by giving him asylum. He presumably already revealed everything he knows or is planning to soon. Foreign governments can benefit from Hyde’s disclosures without doing anything in return. U. Hyde Meah is a political hot potato that is too hot.

Tilting the Scales in Your Favor. If you plan to put a bullseye on your back by revealing top secret government information, plan for a variety of outcomes and strategies to navigate them. Specifically, be aware of whether you have information that makes you valuable to others. As they say at the poker table, don’t show your whole card if you plan to bet the house.

Stressed out from her job as the manager of Brewed Awakening, a Houston-area coffee shop, Mary Jane Blunt heads to Colorado with her family for a well-deserved Spring Break ski vacation.  Blunt is excited to learn that Colorado recently legalized marijuana.  While on vacation, Blunt fully enjoys Colorado’s beautiful slopes and relaxed drug laws.  Responding to a random drug test on her return, Blunt provides urine and hair samples. Five days later her boss advises her that she tested positive for THC (the active ingredient in pot) and that her employment is immediately terminated for violating the company’s policy against illegal drug use.  Blunt argues that legally smoking pot one week ago did not compromise her job performance and because marijuana is legal in Colorado she didn’t violate the company’s policy.  Can Brewed Awakening terminate Blunt for her off-duty conduct in Colorado?

Yes.  As an at-will employee in Texas, Brewed Awakening can fire Blunt for any non-discriminatory reason including violation of the company’s stated policies prohibiting the use of marijuana.  Although some states prohibit termination based upon an employee’s lawful off-duty activities, Texas is not one of them.  Even if Blunt were to claim that she smoked pot for “medical reasons,” any use of marijuana is illegal under federal law and smoking marijuana is not recognized as a reasonable accommodation under the Americans with Disabilities Act.  While some states have made discrimination against medical marijuana users illegal, Texas, again, is not one of them.

Tilting the Scales In Your Favor

With Colorado and Washington both legalizing marijuana, “pot tourism” will become more popular.  Inevitably, “pot tourism” will create problems for employees returning to work after enjoying everything that these progressive states have to offer.  Companies intending to drug test their employees must implement clear policies and procedures.  Any drug testing policy should define what is considered to be a violation, which employees are subject to testing and the disciplinary actions which may result from violation.  Courts consistently uphold pre-employment drug tests as a condition of employment.  Post-employment drug testing can include random testing, post-accident testing, reasonable suspicion testing, and mandatory testing (e.g. the Department of Transportation requires testing for long-haul truck drivers).  While there are almost no restrictions on drug testing which may be required by private companies, government employers are more restricted as courts have held that government employees should be safe from unreasonable search and seizures.  HR departments should be aware that the results of drug tests are considered medical records and therefore must be kept confidential and separate from other personnel records.

Assult RifleLast month Tilting pondered an owner’s liability to customers from violence at the midnight showing of “Paladin – the Gentleman Black Knight” – the remake. Patrons and employees alike were ambushed at the Orpheum Theater. According to news reports the Paladin look-alike bought a ticket. After the movie started he slipped out through an emergency exit propping open the door. After donning riot gear he re-entered, tossing gas canisters and shooting into the crowd.  Subsequently filed lawsuits alleged insufficient security for anticipated crowds and failed alarm system controls on the emergency exit. Is the business owner Pall Adium liable to his injured EMPLOYEES?

Last month we concluded that Pall Adium is probably not liable to his customers. If a business owner’s employees are injured, however, what then?

Employees Assaulted by Third Party?

Like visiting patrons, Pall’s employees have an unlikely claim against a business owner for violent acts in the workplace committed by a non-employee unless there is a “special relationship” between the employer and either the perpetrator or those who are injured. In short, should Pall have reasonably known of the danger? If Pall knew of a threat to the safety of his workers and patrons and knows either of a particular assailant or victim (employee), rather than just a mere general threat, he may be responsible for failing to warn the victim or otherwise to take reasonable protective measures.

Employees Assaulted by Another Employee?

More often than not, the workplace assailant is an employee or former employee who believes he/she was wronged by the employer. More than just having a responsibility to protect employees when he knows of a “problem employee,” Pall also has a duty in the hiring and retention of his employees. For example, Pall could be liable for failing to investigate an employee’s background before hiring or if he fails to fire after having reason to suspect that the employee might commit a violent act. In addition to OSHA/MOSHA federal standards to maintain a safe workplace, Pall has a similar duty at common law to provide a safe workplace for his employees, to warn his employees about any lurking dangers and to impose and enforce reasonable rules to govern his employees’ conduct.

Tilting the Scales in Your Favor

Warning Signs. Even without specific knowledge of a disgruntled employee or the threat of an assailant, Pall Adium should be aware of suspicious, tell-tale behavior like:

  • unexplained increases in absenteeism
  • repeated violations of company policies
  • behavior bordering on paranoia
  • depression and withdrawal
  • overreaction to changes in procedure
  • verbal abuse or threats to co-workers
  • frequent, vague physical complaints
  • explosive outbursts of rage without provocation

Reasonable Precautions

If not already a part of his HR policies, Pall should consider establishing (and including in an employee handbook) policies and procedures to address pre-employment screening, performance evaluations and a progressive disciplinary process. As a result of a Texas law that became effective September 2011, Texas employers should amend their workplace violence policies to permit employees to store legally owned guns in their vehicles while they are at work.

Good News! Workers Compensation Insurance.

Generally speaking, employees injured on a jobsite covered by workers compensation insurance may only recover from that insurance (and not from their employer) injuries and lost wages, even when the injury is caused by criminal assault.


Will this Legislative Session impact business owners? With the assistance of our own LRM Freshman State Rep. Jeff Leach, R-Plano, Tilting the Scales will periodically post updates on bills that might affect your business, along with an occasional humorous twist.

As an example and keeping in the tone of this month’s postings on gun control, as the federal government moves forward on its plans to tighten gun restrictions, Texas lawmakers are proposing legislation to expand gun rights in the state. The latest proposal is HB 700, a so-called “open carry” bill filed last week by State Rep. George Lavender, R-Texarkana, to allow individuals with concealed handgun licenses to carry weapons in plain view on a belt or shoulder holster. Similar legislation failed last session. Other recent proposed policy changes include allowing concealed handguns on college campuses, and arming and training school officials, including teachers.

More summaries to come as we continue through this legislative session.

Assult RifleAttendees at the midnight showing of the remake of the movie “Paladin – the Gentleman Black Knight” were ambushed at the Orpheum Theater. According to news reports the accused bought a ticket and sat in the audience. He waited until after the movie started and then stepped out where he donned riot gear and re-entered the theater, tossed two gas canisters and began shooting into the crowd.  Subsequent investigation suggested insufficient security for anticipated crowds and a lack of alarm system controls on the emergency exit. Is the business owner liable to its customers who were injured in the shooting?

Owner Liability Issues to Customers

Probably not the customers (employees – a different story – will be addressed next month). While a business owners must take reasonable steps to protect visitors coming onto the property or people coming to do business in their store, for victims successfully to recover compensation they must show that past violent incidents reasonably caused the mass shooting at that particular theatre to be foreseeable. The Orpheum responded to its patrons’ lawsuits seeking a dismissal and argued, “It would be patently unfair, and legally unsound, to impose on the Orpheum… the duty and burden to have foreseen and prevented the criminal equivalent of a meteor falling from the sky.” There was no history of similar events to argue a pattern. There was no communication of a threat. The theater would likely be successful in arguing it could not have reasonably foreseen that a deranged gunman would shoot up the theater because it is no more at risk for a mass shooting than any other venue hosting a large crowd of people. Hiring armed security guards over and above the presence of routine local law enforcement patrols is not an ordinary and customary procedure for suburban movie theaters in relatively low-risk areas.

A pattern of criminal problems, such as repeated robberies at the business or assaults in the parking lot, are generally required for courts to hold businesses liable for a crime on their premises.

Tilting the Scales in Your Favor

Insurance. Up to forty percent of businesses affected by a natural or human-caused disaster never reopen. If this happened at your business, could your business survive? Evaluate your commercial property and business interruption policies as well as reputational and crisis management coverage. For most businesses, the brunt of the insurance response will likely fall under commercial general liability coverage because there is no exclusion for random acts of violence or mass events. You may wish, however, to consider public liability insurance. Because of their high-severity and low-frequency nature, insurance for public liability occurrences is designed to protect from incidents on the premises those public venues and other businesses that frequently bring large crowds – a shooting, a structure collapse, an explosion, a terrorist act. Talk to your insurance agent, and review your existing general liability insurance policies.

Reasonable Precautions. The Department of Homeland Security created a checklist of measures recommended to create a business preparedness program. Generally, those measures are summarized as organize, develop and administer a preparedness program, identify the hazards and assess the risks. Then, implement the plan and address the emergency response, crisis communications, employee assistance and training. Annually test and evaluate the plan using a variety of exercises and scenarios.


CHL in TexasSam Colt lives in Dallas and is a gun enthusiast.  As a result of a rash of car jackings in his neighborhood, Colt regularly carries a Glock 9mm in his vehicle for self-protection, although he does not have a concealed handgun license.  Driving to his local bank last week, Colt tosses his gun into the passenger seat so that he has easy access to it in the event of an emergency and to dissuade any anyone with bad intent.  Unfortunately, Colt gets stopped for speeding and the officer sees the gun.  Is Colt in trouble?   

Carrying a Gun in the Car

Yes.  Pursuant to the 2009 Texas Motorist Protection Act, Colt does not need a concealed handgun license to carry a handgun in his car.  However, the weapon must be concealed and Colt may not otherwise be:  (1) engaged in committing a crime; (2) prohibited from carrying a weapon; or (3) a member of a gang.  Colt’s violation would be classified as a Class A misdemeanor (the most serious level of misdemeanor) and would be punishable by a fine of $4,000 or less and/or jail time up to a year.  Interestingly, if Colt instead chose to carry a rifle/shotgun in his car, that weapon need not be concealed.

Where Concealled Carry is Prohibited

Now, assume for the moment that Colt has a concealed handgun license.  Could he bring his concealed weapon into his local bank?  Probably.  While the Texas Penal Code specifies many places that one cannot bring a concealed handgun, a bank is not one of them unless the bank has elected to post a sign forbidding concealed carry on the premises.  Types of places where concealed carry is prohibited include, among others:

  • Schools or on school buses;
  • Polling places;
  • Courts and court offices;
  • Locations where high school, college or professional sporting events are taking place;
  • Nursing homes;
  • Amusement parks;
  • Places of worship;
  • Government meetings;
  • Anywhere alcohol is sold if 51% or more of their revenue is from the sale of alcohol;
  • Secured airport areas;
  • Within 1,000 feet of the premises of an execution on the day of execution; and
  • Businesses posting signs prohibiting handguns on their premises based on criminal trespass laws.

Tilting the Scales in Your Favor

The best rule of thumb for those who do not have a concealed handgun license is to always transport your gun in its case in the back of your car.  If you are keeping the gun in your car for safety reasons, then store it in the glove box or under your car seat.