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REPORTER'S RECORD TRIAL COURT CAUSE NO. 2012-DCL-8605 - - - - - - - - - - - - - - - x : BROWNSVILLE I.S.D. : : VS : : TEXAS WINDSTORM INSURANCE : ASSOCIATION, GAB ROBINS NORTH : AMERICAN, INC., CUNNINGHAM : LINDSEY U.S., INC., REGGIE : WARREN, AND STEVE BORGMAN : : - - - - - - - - - - - - - - - x

IN THE DISTRICT COURT 107TH JUDICIAL DISTRICT

CAMERON COUNTY, TEXAS

DEFENDANT TEXAS WINDSTORM'S MOTION TO EXTEND DISCOVERY RESPONSES, PLAINTIFF'S MOTION TO COMPEL, AND MOTION FOR TRIAL SETTING

On the 12th day of December, 2013, the following proceedings came on to be heard in the above-entitled and numbered cause before the Honorable Benjamin Euresti, Jr., Judge Presiding, held in Brownsville, Cameron County, Texas. Proceedings reported by computerized stenotype machine.

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A P P E A R A N C E S APPEARING FOR THE PLAINTIFF: HON. J. STEVE MOSTYN State Bar No. 00798389 The Mostyn Law Firm 3810 West Alabama Street Houston, Texas 77027 (713) 861-6616 HON. GILBERTO HINOJOSA State Bar No. 09701100 Law Office of Gilberto Hinojosa & Associates 622 East St. Charles Street Brownsville, Texas 78520 (956) 544-4218 APPEARING FOR THE DEFENDANT TEXAS WINDSTORM: HON. ANDREW T. MCKINNEY IV State Bar No. 13716800 Litchfield Cavo, L.L.P. One Riverway, Suite 1000 Houston, Texas 77056 (713) 418-2000 HON. JOE HERNANDEZ JR. State Bar No. 09517700 Guerra, Leeds, Sabo & Hernandez, P.L.L.C. 1534 East 6th Street, Suite 200 Brownsville, Texas 78520 (956) 541-1846 APPEARING FOR THE DEFENDANT GAB ROBINS, CUNNINGHAM LINDSAY, AND STEVE BORGMAN: HON. DAN K. WORTHINGTON State Bar No. 00785282 HON. E. MICHAEL RODRIGUEZ State Bar No. 00791553 HON. EDUARDO ROBERT RODRIGUEZ State Bar No. 17144000 Atlas, Hall & Rodriguez, L.L.P. 50 West Morrison Road, Suite A Brownsville, Texas 78520 (956) 574-9333

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APPEARANCES CONTINUED APPEARING FOR THE DEFENDANT REGGIE WARREN: HON. ALBERT A. CARRION JR. State Bar No. 03883100 Husch Blackwell, L.L.P. 111 Congress Avenue, Suite 1400 Austin, Texas 78701 (512) 472-5456 (512) 479-1101 Fax

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INDEX PAGE 7 13 32 36 42 42 51 53 54 VOL 1 1 1 1 1 1 1 1 1

Defendant Texas Windstorm's motion to extend time for discovery responses Plaintiff's motion to compel Court's ruling on motion to compel Court's ruling on motion to compel Court's ruling on motion to compel Motion for trial setting Court's ruling Adjourn Certificate of Court Reporter

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INDEX OF EXHIBITS PLAINTIFF'S EXHIBITS: NO. 1 DESCRIPTION E-mail from Bill Knarr dated October 11, 2008 E-mail from Bill Knarr dated November 17, 2008 E-mail from Bill Knarr dated May 25, 2009 E-mail from Alan Renshaw dated June 29, 2009 E-mail from Bill Knarr dated February 26, 2008 E-mail from Bill Knarr dated February 18, 2009 OFFERED 32 32 32 32 32 RECEIVED 33 33 33 33 33 VOL 1 1 1 1 1 1

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P R O C E E D I N G S THE COURT: versus Texas Windstorm. MR. HINOJOSA: THE COURT: Good morning, Your Honor. 12-DCL-8605, Brownsville I.S.D.

Good morning. Gilberto Hinojosa and Steve

MR. HINOJOSA: Mostyn and Stephanie -MR. MOSTYN: MR. HINOJOSA:

Magee. -- Magee for the plaintiffs. Judge, Dan Worthington,

MR. WORTHINGTON:

Eduardo Rodriguez, and Michael Rodriguez for GAB, Cunningham Lindsey, and Steve Borgman. MR. McKINNEY: Andrew McKinney and Joe

Hernandez, Your Honor, for Texas Windstorm Insurance Association. MR. CARRION: Blackwell for Reggie Warren. THE COURT: Did we get everybody? Yes, Your Honor. What do we have? Albert Carrion with Husch

MR. HINOJOSA: THE COURT:

All right.

MR. WORTHINGTON: motions set today.

Judge, there are three

There's a motion for trial setting, a

motion to compel, and a motion to extend discovery responses. THE COURT: Okay. What do you want to hear

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first? MR. McKINNEY: The first filed motion was

the motion to extend the time for discovery responses, Judge. That was my motion. THE COURT: Motion to extend? Yes, Judge. Okay.

MR. McKINNEY: THE COURT:

Go ahead. I substituted into this

MR. McKINNEY:

case, Your Honor, in mid-October and learned at the end of the month toward the end of October, I want to say October the 30th, that discovery had been propounded on my predecessor on September the 30th. November the 4th. Answers were due on

I E-mailed opposing counsel requesting

an additional two weeks because I was jammed up on time. I had an out-of-town travel planned. very busy in Galveston. I had -- we had been

We had nine cases set for trial

on November the 4th in Galveston, and I had been very occupied for a two month or six weeks period of time to prepare for those cases. I did not get an agreement to extend time by two weeks, so I filed a motion with the Court to extend the time by two weeks. In fact, I responded in I want to I objected to

say nine total days and six business days.

about half, answered subject to the objection in most cases and just answered the rest of the discovery.

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 standard.

So we're really here to determine whether by -- moving within the 30 days for an extension of time two weeks stating my good cause. to get to it. I just didn't have time I need

I didn't have the full 30 days.

some additional time to investigate and talk to my client and whatnot, whether I waived my objections. And I think it's always been pretty I don't spend much time in the Valley, but all

the Valley lawyers I've ever worked with always have extended time to me. I've always extended time to them. And I'm just asking for

It's how I've typically done it.

two weeks so that my objections can be heard on the merits. I may lose on the objections, but I'd like to be

heard on the merits. MR. MOSTYN: Your Honor, can I respond? It generally is my

Steve Mostyn for the plaintiff.

practice to grant an extension, but I've had experience with this particular law firm. In fact, Mr. Worthington

needed an extension, and I granted him an extension for two weeks because Mr. Worthington and I know each other. I asked him to be sure to provide me -- if I gave him an extension, would he actually give me the answers, not just objections. And he agreed to that, and that's what I got With this particular law firm in

from the GAB Robins.

Galveston, we've been down the can-I-have-an-extension

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road, and then I get nothing but objections. And in fact, if you will defer the ruling on this until you hear the merits of the objections, they didn't answer a single interrogatory, nor did they file a verification. In fact, Judge, they even objected to

answering the question of who was answering the interrogatories. And so when Mr. McKinney asked me for an extension, this is for the Brownsville Independent School District, I wrote him back and I said, "I cannot agree o that. The school is leaking every day, and there's mold This case must move as quickly as

in the classrooms. possible."

And what we got back, Your Honor, we did get a motion to extend time that they didn't request a hearing on. We've had to follow up on numerous occasions

asking them to supplement their answers, including an E-mail between he and I -- me and his managing partner in which I state to the managing partner, "We still --" this is two weeks after they had -- answers were due. I wrote

to his managing partner, a Tory Taylor, and I said, "In addition, in the B.I.S.D. case, you have not answered or objected to discovery and it's several weeks late. We're

spending a lot of time trying to get you guys to follow the rules. We will be asking for costs in that motion."

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 cog."

And his answer was, "I'm not handling B.I.S.D. responses." And I wrote, "Well, who is? handling B.I.S.D.? Who is

Are you not the managing partner?"

And he wrote me back, "I am, but it's small

And so, Your Honor, I think if you want to defer on whether they waived or not, once you look at what they gave us to see if they were attempting in good faith to try to answer something, because I don't believe that's what you're going to see. And so whether they waived

objections or not, as you can tell, they knew their discovery answers were due. mistake. They filed in their motion for substitution that they would not cause delay in this case if I would not oppose their motion to substitute. I did not oppose It wasn't by accident or

their motion to substitute, and the first thing out of the box is we're going to cause delay. And so when he asked me for a request on Thursday and his answers aren't due for another about four days, he says in there the reason he needs a request is he wants to go out of town. like to go out of town." That's what he told me, "I'd Well, I'm not at liberty to give

that extension at that point because I'm trying to get

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this case moving as fast as I can. MR. McKINNEY: say, Judge. I do have a few things to

My opponent and I -- this is highly unusual If we've spoken by telephone once

for me in a lawsuit.

since I've gotten involved in this litigation, I would be surprised. telephone. I don't think we've ever conferred by I don't think we've ever conferred, period. From almost my initial involvement and the TWIA litigation in Galveston, I've been subjected to personal attacks and statements that are -- whatever truth there might be underlying those statements, seems to get stretched to a point where I don't recognize the person being discussed or the activity being discussed. We have had a number of hard-fought battles in the Galveston litigation. My opponent has objected to

all of our discovery and refused to produce witnesses in almost every instance. Our position has been until we

hear from your side of the case, we really can't respond on our side of the case. Galveston. That battle continues up in

I hope it does not become a spill-over here in

Cameron County. I asked for a simple two-week extension. had travel plans to New York. I had other pending I was never I

matters, and I needed some additional time.

asked and my opponent knew who was lead counsel in this

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case.

He did not send me any E-mails.

And if he sent an

E-mail, if he did because I've never seen it, to my partner saying that we were two weeks late in this case, that was an untrue statement. late in this case. We've never been two weeks

We answered within -- well within the

two-week extension I requested. And I don't think, with all due respect, that it's proper to determine after hearing an objection on the merit whether the objection's been waived. I think

it would be the appropriate procedure to simply determine whether or not there's been a waiver by asking for two weeks and requesting that of the Court and answering well within that period. And to address one point made where it was stated that I objected to identifying who answered these interrogatories, that is not the case. The question

doesn't just ask who answers -- who answered these interrogatories. The question also calls for a

description of each individual's role in the claim made the basis of this suit. And I answered that -- I objected Certainly we have no

to that part of the interrogatory.

problem identifying who answered the interrogatories, and we did that. THE COURT: good start here. All right. I think we're at a

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 think --

MR. McKINNEY:

I hope not, Judge.

MR. HINOJOSA:

Your Honor, one thing I

think the Court needs to know is that the motion to compel is inextricably tied in to their motion for extension. It's the same issues. That's why Mr. Mostyn is saying the

Court should hear the motion to compel and then make a ruling on everything because they're all -- it's all down to the issue of the objections and their answers and the responses to the discovery. THE COURT: All right. Well, let me hear

the motion to compel and I'll make a ruling on both. MR. MOSTYN: Your Honor, can I hand you -We also

this is our request and their objections.

attached -- since Mr. McKinney wants to discuss Galveston, we attached a $15,000 sanction that was issued against them two weeks ago for continued discovery abuse in the Galveston matter. And so, Your Honor, we'll go to -- if you turn the page there, you'll see that we can start with the request for production, Your Honor, the second request for production. Can I -- I apologize, Your Honor. Can I make

sure yours is in the same order as mine? that. Yes, it is.

I apologize for

We'll start with the second request

for production.

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MR. McKINNEY:

May I point out the second

request for production was responded to timely and is not a part of the motion for extension of time? MR. MOSTYN: THE COURT: MR. MOSTYN: I agree with that, Your Honor. Okay. The second request for

production, Your Honor, involves -- we represent -Mr. Hinojosa and I represent Brownsville Independent School District in a case against Texas Windstorm Insurance Association. It is a large case. Our estimated

damages is around $28 million that is owed to the school. We have been produced by Texas Windstorm Insurance Association in the other litigation that has gone on around the state -- I've handled about 5,000 of these cases. I'm down to two. This -- three, this one,

Cameron County Housing Authority, and representing the city of League City. In the production of those 2 million pages of documents, much of it was recently given to us. We

have found and did find disturbing instances of conduct by the TWIA management. Those are attached to my brief. The

management used Mr. Knarr and Mr. Reggie Warren, who are vice-president head of claims and who are the head of claims, used terms in their E-mails that may describe why this school's claim was never even adjusted admittedly by

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the adjuster.

The adjuster admits that he never went out.

This is inside the E-mails that were turned over to us. In order to have the Court understand, there was about 60 search terms that they were required to run against their E-mail database for the 14 managers. There were things such as adjust, claims handle, words that had to do with claims. In the midst of all of these E-mails, we came across E-mails that are very disturbing. And the

person sending these E-mails, in particular Bill Knarr, is the person who was in charge of the Brownsville Independent School District. And he sent E-mails, Your

Honor, titled such as, "White guilt, White pride." He sent E-mails describing, "Immigrants should be shot." He sent E-mails which have been quoted recently about filling the Mexican border with alligators. He sent jokes, what they refer to as jokes about Mexican tree removal. He sent E-mails about drinking and shooting illegal immigrants, Mexicans, and heirs because there's too many of them in the country. He sent E-mails, like number 16, to other managers who were on this claim, that are, "Wake up, White boy."

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He sent E-mails that are attached to our motion, Your Honor, that are -- such as Mr. Orr, who was a claims examiner for TWIA wrote, "Have you noticed if you arranged the letters in the words 'illegal immigrant' and add a few more letters, it spells off," and I'll abbreviate the words, but, "F off and go home, you hairy faced, sandal wearing, bomb making, benefit grabbing goat, F-ing smelling raghead bastards. How weird is that?" He then

Mr. Knarr was sent that E-mail.

forwards it to the head of claims, Mr. Warren, who says that the adjuster is having a good day. We see E-mails in which an individual, who I represented, Alejandro Gutierrez had requested displacement coverage for his home that was destroyed in Galveston Island. Mr. Knarr tells the adjuster, who is a

Mr. Nance who had sent many of the -- these E-mails, one in particular about how White people are discriminated against by Hispanics and illegal immigrants. He sent Mexican

E-mails that said, "Mexican working the system. get no more money for displacement."

These are the E-mails that the person in charge of Brownsville Independent School District sent. This person was the vice-president of the company. This

person was the person in charge of Brownsville Independent School District.

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We have requested from TWIA that they produce to us all E-mails to or from TWIA management, which are those 14 individuals, from May 2007 to March of 2010 that used one or more of the following terms or phrases. And, Your Honor, I want you to know that before I sent the request, I did put at the top in big bold letters that the following words are offensive and that we only repeat them because we have found them in TWIA E-mails circulated amongst TWIA's management. that we seek are: Terms

Arab -- and I do apologize to the Court

again -- beaner, Hispanic, immigrant, Mexican, nigger, Spanish, spic, wetback, White boy, White power, and White pride. Defense counsel's response to that is, "The foregoing is a list of racist terms that people today still use; however, none of the terms are related to handling insurance claims." They go on to say that I have found instances of crude or racist, or both, behavior and attitudes and TWIA disavows such behavior. If I can

demonstrate -- identify the use of racist terminology under circumstances where an inference -- this was their answer before they saw the E-mails that I had in the deposition. If I can demonstrate the term racist -- the

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use of racist terminology under circumstances where an inference can be drawn that a racist viewpoint played a role in a claims decision, TWIA will agree to a narrower scope of search terms. Your Honor, I want to mark this E-mail as Exhibit 1 so the Court can review it. Your Honor, I want to point the Court to another E-mail I'm going to mark Exhibit 2 in which Mr. Knarr is informed that the Hispanic gentleman in that case is a wealthy Mexican, the implication being that we can't treat them as we have Mr. Alejandro Gutierrez. So these E-mails are clearly relevant, clearly that you can draw more than an inference that a racist played a role in adjusting these claims. And I

could go on and on and on about the things that was spread around inside of this company by the managers of this company and, in particular, the manager of -- who was in charge of this claim. We have an E-mail, I'll mark this one as No. 3. Mr. Knarr sends out to the entire adjusting group "A man seeking to join an East The

a joke that he sends out:

Texas Sheriff's Department is being interviewed.

deputy doing the interview says, 'Your qualifications all look good, but there's an attitude suitability test that you must take before you can be accepted.'

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"Then sliding a service pistol across the desk, he says, 'Take the pistol and go out and shoot six illegal aliens, six meth dealers, and six Muslims, and a rabbit.' "His answer was, 'Why the rabbit?' "He writes back, says, 'Great attitude,' says the sergeant. 'When can you start?'"

There's another E-mail I want to mark as No. 4 about illegal immigrants and Hispanics stealing Social Security changes. This goes on and on and on. And

we got these E-mails, Your Honor, accidently because somehow they met a search term. And now that we have

them, we think, unless he's got some proof it would -which he did not bring down here to this Court, that this would be some undue burden on them, we ask that they be ordered to produce those E-mails to us. MR. HINOJOSA: Your Honor, and the other

factor there, one thing Mr. Mostyn already mentioned, this is in their company. accounts. And secondly, Your Honor, this is Hurricane Dolly that was a devastating storm here in South Texas, and particularly with B.I.S.D. B.I.S.D. has over 500 These are not personal E-mail

facilities, schools, you know, administrative buildings, bus barns, et cetera. They were down here, what? Two

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days? MR. MOSTYN: MR. HINOJOSA: One. One day to adjust the claim,

left, never came back, and sent back a letter saying, "Well, your claim doesn't meet -- your damages don't meet your deductible. you any money." And we had school district buildings all over -- and we met with the superintendent and the director of maintenance a few weeks ago. And you've got So, therefore, we're not going to send

buildings all over B.I.S.D., schools where children are going to classes where there's leaking continuously when it rains. There's mold occurring as a result of that. And I think the argument, Your Honor, is that what other reason would TWIA just completely ignore one of the largest school districts in the State of Texas, probably the largest school district with the largest number of Hispanic students of any other school district percentage wise in the State of Texas, other than a bias against students and the families that were part of this community? And that's why they're clearly relevant to this litigation, Your Honor. I think that the jury would

have to see ultimately the attitude and the way -- the attitude of these individuals that were in charge of this

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particular claim.

You compare it to the actual conduct on

their part when it came time to doing their obligation -to performing their obligation, which they had been paid to perform by the school district with the taxpayers -the taxpayer dollars, of these same individuals that they -- that their managers claim are all these horrible things that you hear and see in these -- in these E-mails. And these E-mails pop up in their files, in their company files. This is not something that we went

into their accounts knowing that somehow there was something there and we searched it because we thought we were going to come up with it. These things just popped

up when we requested the information with respect to this case. MR. MOSTYN: And, Your Honor, we took the

deposition of Mr. Borgman, who was the adjuster assigned to this case. Mr. Borgman testified under oath that Bill

Knarr sent a lot of racist jokes that he did not read them. He deleted them. I missed the follow-up question

of, how would you know what they are if you didn't read them? But Mr. Borgman said he was sent a lot of them. He

said that he did not keep them because they were on his AOL account. They do exist inside TWIA still. They still

have the E-mails. criteria for them.

They just need to do the search

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 for awhile. things.

Their adjuster also testified under oath that he did not visit only six out of the 35 campuses, that -- what he testified personally under oath that it was not reasonable that he did not investigate those claims. And he testified under oath as we took him

through pictures of damaged building after damaged building that he never stepped foot on, he testified he never stepped foot on. He testified he was the only TWIA He testified that

adjuster who would have gone out there.

there was no investigation, and I showed him pictures of the damage. I've never seen -- I've done 5,000 of these I have never seen a large corporate commercial

entity, not to say a school district, treated in the manner in which this case was treated. There are actually

year-and-a-half gaps in the time that they did nothing on this file. The man disappeared, the adjuster did. There

are E-mails looking for him from a guy named Bill Knarr. And then Bill Knarr tells him to just close the file, and he closes the file. A year-and-a-half in March of 2010,

the gentleman closes the file without so much as even investigating the loss but other than one or two of the campuses. And so it was quite a head scratcher to me What was going on in the Brownsville

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Independent School District case?

And I've run across And the question

this type of outrageous use of language.

is, will it lead to relevant -- or likely to lead to relevant -- it goes to whether they did this intentionally or not, and we see it in claims handling with one gentleman already and we have a right to see this if it's more widespread. MR. WORTHINGTON: might interrupt? Mr. Borgman. Judge, I'm sorry. If I

Dan Worthington on behalf of

The motion does not apply to us. MR. MOSTYN: It doesn't. We answered our I do take some

MR. WORTHINGTON: discovery.

Having said that, I do object.

disagreement with Mr. Mostyn's characterization of Mr. Borgman's testimony. deposition -MR. MOSTYN: play them. MR. WORTHINGTON: them, that's fine. If you'd like to play There I have clips if you want to I mean, ultimately the

There were not 35 campuses.

were other adjusters who looked at all -- adjusters looked at all of the campuses. Having said that, that's not, you

know -- and I'm not aware of any requests that involve us in the case, but think it's -- I did think it was important for me state our objection to the

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characterization of his testimony. MR. MOSTYN: Let me address that, and I've

got -- if the Judge wants to, I've got all the clips here and they're cut up. There was an excess carrier from Travelers for any building above 3,390,000. So Hanna High School is

above 3,390,000 for the main campus, and Porter High School is above 3,390,000 for the main campus. had the coverage up to 3,390,000. But TWIA

The excess carrier went

out and looked at some of the campuses, but only five percent of the policies would even be -- only five percent of the buildings would exceed the 3,390,000, so that coverage would kick in. In Mr. Borgman's final report, he writes to TWIA and says, "Engle Martin won't give me their data. Engle Martin will not give me what they looked at." If he

had gotten what Engle Martin had looked at, he would have seen, as he testified in his deposition, buildings that exceeded the TWIA deductible. He says he spoke to -- in a shocking admission, he says, "I spoke --" in his final report, he says, "I talked to the adjuster who refuses to give me their information. They won't give it to me. After

repeated requests, they refused to give it to me, but they tell me their damage is below deductible."

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Not until the deposition did Mr. Borgman learn and figure out that the deductible that the Engle Martin adjuster was referring to was $3,390,000 per building. What is the TWIA deductible? On some of the

buildings, on many of the buildings, all the portable buildings, the deductible is $1,000. And so on behalf of

TWIA, as Mr. Borgman admitted, no one visited those campuses. And so the reason I bring that up is there's got to be some explanation for this type of claims handling. And we think -- we've made the allegation of

what we believe it is, and we have a right to conduct the discovery. THE COURT: All right. A response?

MR. McKINNEY:

A number of items have come

I received the E-mails that the Court has heard about I had not seen them before yesterday. I've

yesterday.

had a chance to read them once. There is some background that the Court might find in interest. they say. Certainly the E-mails say what

For what it's worth, it may not be worth much,

some of the E-mails are certainly over the line in terms of being racist. They clearly are. Others I would say What I

are just in poor taste, but that's all subjective. think doesn't matter.

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What I would like the Court to know, first and foremost, is that when Dolly and Ike hit back in 2008, the TWIA management, let's call that Group A. Group A was

some folks who ran TWIA and were confronted with two major catastrophes virtually back to back. And it turned out

that in addition to other issues, such as Bill Knarr's issues with people who aren't White, handling the size of the losses was beyond the skill set and capacity of Group A. Sometime in the 2010, 2011 time frame, by the end of that time frame, all prior TWIA management, everyone in Group A had either been retired, terminated, or had passed away. In Bill Knarr's case, he's dead. So

we're not going to be able to take his deposition and find out what he meant, and what he did, and what he said and tie all that together. In no way, shape, or form does TWIA ratify, adopt, what have you, the kind of crudity that I saw yesterday and has been called to the Court's attention today. And our position in responding to the discovery

request is that we would agree to a narrower, a narrower scope of discovery if evidence could be brought forward that issues of racism have played a role in the claims handling decision in this case. In my view, the fact that Bill Knarr was

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involved in this case and the fact that Bill Knarr is or was a racist, I think that puts us on the bubble, maybe yes, maybe no, that racism played a role in how this claim was handled. I think the claim-specific E-mail such as

they are does not show that. But leaving that aside, what I would propose is that the document request being requested be limited to E-mails sent and received by Bill Knarr and by Reggie Warren, the two people who have been identified as management level people who have played a role in this case. If we limit it to the people who played a role in this case, received by, sent to, then we are limiting what would otherwise be a fishing expedition. are limiting the scope and discovery to the individuals who may have played a role. I think that's fair. We

That's dealing with the discovery request. There's one other matter I'd like to address before we move on, and that is the adjustment that was done on the Brownsville I.S.D. case. What happened was Steve Borgman

was hired by a company that was then called, I believe, GAB Robins? MR. WORTHINGTON: MR. McKINNEY: Correct.

Was hired by TWIA as an So

independent adjuster, but it's a nondelegable duty.

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TWIA is on the hook for whatever Mr. Borgman did or did not do. So what I'm getting ready to say doesn't mean

we're trying to walk away from or not take responsibility for what happened, because we have -- we are going to take responsibility for everything that happened. Steve Borgman got to Brownsville I.S.D. along with a team of adjusters from a company called Engle Martin who were hired by Brownsville's excess carrier. And supposedly these adjusters agreed to divide up the properties that they were told had been damaged by Hurricane Dolly. Steve Borgman went out and supposedly looked at six properties. The Engle Martin people went I'm not a

out and looked at 30 properties or thereabouts. hundred percent clear on the numbers.

And verbally,

according to Steve Borgman, the Engle Martin people reported to Borgman that all of the damage was below deductible. Borgman testified in his deposition that he

believed that they were telling him -- that Engle Martin was telling him that the damages were below TWIA's deductible. Borgman found out the day before his deposition, because by that time the Engle Martin file had been obtained, he found out that the Engle Martin adjusters were referring to the Engle Martin deductible,

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3.3 million and change, not the TWIA deductible, sometimes a thousand dollars but never more than one percent of the property value as I understand it. So there was -- there were a number -there were breakdowns in communication and a methodology was used by Mr. Borgman that TWIA agrees did not meet industry standard by a considerable margin, all right? do not expect to be able to successfully defend the adjustments that were done on any of the 36 properties in this case. And I am going to be submitting a proposal in writing to have each of those properties looked at, estimated, and if -- you know, if we have local folks or folks that have done work for Browning Independent School District for built schools or repaired schools, we'll come out and do estimates. My understanding is that TWIA will -- they have to do their due diligence because they're under supervision by the Department of Insurance. But assuming We

that those estimates are in line with prevailing charges in the area, TWIA will pay those estimates and a 23 percent penalty going back to essentially the date of the adjustment, which is what's owed under the statute. We did not do this the way it should have been done, and we do intend to make it right. And we do

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not intend to ask for a release for making it right. do ask that whatever we pay be credited toward any judgment that the jury returns. But we agree that

We

Brownsville I.S.D. should receive compensation as quickly as we can make that happen in a reasonable and prudent fashion. So that's our position on the adjustment. That's our position on the document request. And I think

that wraps up what I wanted to say on these issues, Your Honor. MR. MOSTYN: new position. Your Honor, I appreciate their This

That's the first time I have heard.

case has been on file for a year.

And when Mr. McKinney

says he hadn't seen the E-mails, well, they gave me the E-mails. And I assure you if I would have gotten a

request for production that says E-mails that I was representing contained these terms, I would have gone and looked at them before I objected to giving them to me. And their objection was not whether Mr. -- I can prove. don't have to prove Mr. Knarr is a racist on the B.I.S.D. case to get discovery. I need discovery to prove it. And I

I demonstrated to this Court that he had those attitudes. Their original -- because they had -- what they told you is true. gave me. They've never looked at what they

Never have, because when they first objected --

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THE COURT:

Well, he's agreeing that he

would turn that over to you if it's limited to those two individuals. What's your -MR. MOSTYN: My response to that is there's First of

additional individuals in the claims activity. all, there is a -- Gene Kounse is in there. THE COURT: MR. MOSTYN: a Ms. Robinson, a Mr. Todd. To this claim?

For this claim, yeah. So there's additional

There's

individuals, but our allegation, Your Honor, is that in one of those E-mails I gave you, Mr. Knarr would circulate these to the entire claims department. culture was there. And so not only that, we also know that TWIA's claims files often are lacking, as this one is -this is the entire activity log for 800 and something campuses -- are often lacking the people who worked on there. So we don't want every employee, but we do want So this whole

every manager that was there during that time. MR. HINOJOSA: does it hurt them? Well, Your Honor, and what

I mean, what we want to know is -- I

mean, we've got clearly examples of where the management of this organization is engaged in ultra, ultra racist attitudes. I mean, we've got a whole bunch of other

E-mails that the Court would be appalled at when you

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looked at them.

What is it going to hurt them to give us

this information; and then at the time of trial, the issue of whether or not they're admissible, that can be argued at that point? But we need to figure out exactly what

they've got, Your Honor. THE COURT: granted. MR. MOSTYN: Your Honor, we have a All right. The motion will be

second -- the next request for production is in these E-mails, we discovered that they kept quality control files on each adjusting company. adjusting company on this case. And GAB Robins was the So we asked for the GAB

Robins quality control file during this time period. MR. HINOJOSA: Your Honor, before he goes

into that, can we -- we offered those documents, Exhibits 1 through 4, and here's also Exhibit No. 5. Can

we have those admitted, Your Honor, for purposes of the record? MR. McKINNEY: was looking -THE COURT: exhibits. MR. McKINNEY: Honor. THE COURT: They'll be admitted. I have no objection, Your They're offering 1 through 5, Pardon me? I'm sorry. I

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(Plaintiff's Exhibit Nos. 1 through 5 admitted) MR. MOSTYN: That's fine. Thank you. We have

There's a quality control file.

E-mail examples of where whenever GAB Robins would make a -- would make an error or have a problem with an adjuster, that Mr. Knarr would say, "This is going to the quality control file." Let me mark this as Exhibit 6. It's just a

discussion of how poor the adjustment quality is for GAB Robins, and it says it's going to go to the quality control file. So we sent a very specific request for

production and I said, "Give me a copy of the quality control file for GAB Robins," which is the company that adjusted this claims. One of the allegations that we have made is that the mishandling of this claim was done knowingly, which is actual awareness of harm or falsity of the handling of the claim. They have a file on GAB Robins I

that shows that GAB Robins does not do a good job.

asked for the file during this time, and they said they won't give it to me if it's not related to Brownsville I.S.D. Well, if someone has four D.W.I.s before they get

the fifth one and the four prior ones were reported to me, they knew that this company was doing a poor job before or

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during the handling of this claim. control file. THE COURT:

I want the quality

All right.

A response?

MR. McKINNEY: think it's overly broad.

Judge, what we said is we

We think it's irrelevant and a

fishing expedition because we have to make those objections to preserve our record. But subject to the

objection, if such file exists, we said we'll produce it under separate cover. And we're looking for it; and if we

have it, we'll produce it. MR. MOSTYN: objection overruled. Well, then I'd like their

I don't have an answer that says you

will produce it, but -THE COURT: All right. I'm looking at my response

MR. McKINNEY:

that says, "To the extent such a file exists and is related to Brownsville I.S.D. and subject to any presently unknown privileges, it will be produced under separate cover." MR. HINOJOSA: saying. That's exactly what we're

They're just saying -- they put the qualifier on We just want the quality control file on

there, you know. this gentleman.

THE COURT:

All right. Well, it ought to relate to

MR. McKINNEY:

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this claim. MR. MOSTYN: It does relate to this claim.

The fact that if you knew that your adjusting company was doing a poor job, my question would be why would you assign it to 877 separate school campuses to adjust? we see the result, the admitted result that it was completed messed up and mishandled. My question now is, And

did you have a reason to know that that was going to happen? And that is in the quality control file. MR. McKINNEY: If there is a quality

control file that in any way relates, directly or indirectly, top side or bottom, to the handling of this claim and if we don't have some privileged document in there -- and we'll produce a privileged log if we do -- we will produce the quality control file. I mean, the reason why I don't think it's going to be relevant in this practical matter is we assigned it to Borgman in July of 2008. And almost

certainly, any quality control file is going to be Ike-related, which is going to be much later in time than Dolly which preceded all of this. So I don't think

there's going to be a quality control file that's, you know, time-wise even relevant to the case. But I'm

telling you, if we've got one, you'll have it. MR. MOSTYN: Well --

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 request. court.

MR. McKINNEY:

I'm saying this in open

MR. MOSTYN:

I understand, but,

Mr. McKinney, the Brownsville I.S.D. claim was not closed until March of 2010. And during that time, the continued The Ike quality

handling of the file was by GAB Robins.

control file that he refers to, in which one of the E-mails I handed you what he calls the Ike one, to me it's by a company, Ike occurred in 2008. So at any point

during the time of the handling of this claim, if it came to their attention that this company was not doing proper adjustment, we're entitled to that file. THE COURT: All right. I'll grant the

MR. MOSTYN:

Your Honor, the next -- you're The next set of

going to see my frustration here.

information that we have to go through is their interrogatory answers. In interrogatory number 1, Your

Honor, I asked them in interrogatory number 1, "Identify all persons --" THE COURT: Okay. Let me stop you there.

I assume you've already discussed this with counsel? MR. MOSTYN: I wrote him several letters

and asked them to withdraw their objections to which I got no response.

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THE COURT:

Okay.

I assume the

objections -- you're still objecting to those responses? MR. McKINNEY: THE COURT: just wanted to make sure. MR. MOSTYN: MR. McKINNEY: And -Just for the record, we Judge, I am, and -Let's proceed then. I

Okay.

don't -- in this litigation, there isn't any sit down and work things out conversation. You file your -- if a

defendant files objections, there's a standard boilerplate letter that says, "All your objections are without merit. Please withdraw them or we will file a motion to compel and seek costs." So there's not any discussion. There's,

"Drop all of your objections, or we'll see you in court," and then we come to court. THE COURT: Well -So that's the history of how

MR. McKINNEY:

THE COURT:

So my question is then, it

wouldn't do any good if I said for you all to go out in the hall and look these over and see if you can work anything out? MR. MOSTYN: Your Honor, what I would like

to do is go over the first two and then maybe we should go out.

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THE COURT: MR. MOSTYN:

Okay.

Well, let's do that.

Just as an example, because I

don't want to -- I know this Court has many things to do. Number 1, I asked for: "Identify all persons, address,

including job titles, dates of employment, and description of each individual's role in the claim made the basis of this lawsuit, if any, for all persons providing information for the answers to these interrogatories." So if the person answering the interrogatories -- I want to know for all persons providing information to the answers in interrogatories, their name, the address, their job title, and any role they provided in the claim. They objected, told me it was vague and ambiguous, unduly burdensome. And despite what he told

you about he went ahead and gave me names, there are no names. It says, "Subject thereto, TWIA directs you to the

claim file which will be or has been produced under separate cover. The claim file contains the names of

individuals acting for TWIA and the independent adjuster, Mr. Borgman, who plaintiff has sued." I need them to tell me who answered the interrogatories and if they played a role or not. There's

no verification on these interrogatories, so I don't know who might have verified them. But they won't give me a

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person's name.

And they direct me to a claim file, which

they have admittedly stated in other cases and the adjuster stated in this case is not complete. So tell me

who's answering the interrogatories and tell me their name. Let me just go to the second: "Identify

all persons or entities who handled the claim made the basis of this lawsuit on behalf of defendant Texas Windstorm Insurance Association and their last known address if current address is unknown." They objected.

They said that was vague and ambiguous in the meaning of handle the claim. This goes on and on and on. There are 20

something interrogatories, not a single answer. MR. McKINNEY: answer to that very one. Excuse me. There was an

And what we said was we propose

resolving this objection by an agreement to identify the decision makers with respect to claims adjustment and payment or other resolution. And here's why we're taking that position, Judge. It's not just because I have the time to sit

around and think of objections and I want to fly down to Brownsville on Wednesday nights, particularly this Wednesday. anniversary. It was -- just yesterday was my 37th

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Whenever we give the names of everybody who cut a check or filed a document or something like that, we might have 18 or 20 names of clerical people and administrative people who were part of the claims handling process. We get a request for their depositions, and we And we

have to go find their last known addresses.

have -- I can dig around in some of the Galveston cases and find letters where 18 or 20 people have been requested from TWIA for a -- it just goes on and on. And so what we propose is the relevant inquiry, at least for starters, is who were the decision makers, who made the decision to do what on these files? We can identify them. And if that'll discharge our

obligation for the time being, we're happy to do that. MR. HINOJOSA: $30 million claim. Your Honor, this is a

I mean, this is a $30 million claim.

If they don't have time to go look at those things because it's too much work, that's absurd. This is a case where That kind

they should have given this right off the bat.

of a response, Your Honor, is a response that has no bearing on the seriousness of this particular case. It is obvious that we're entitled to know anybody's name who touched this claim and their address and where they're at now because this happened a long time ago, and they may not be around. And if they need to go

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search other files and find out exactly where they're at, then go do it, Your Honor. But this kind of a response is absurd, Your Honor. They propose resolving the objection by an

agreement to identify the decision makers with respect to claim -- what the hell does that mean? just give us the names and addresses. You know, I mean, Tell us what they

did, and we'll decide whether we want to take their deposition. But this is the kind of stuff why we're so frustrated in dealing with these folks, Your Honor, is that this is basic hornbook type of request that they should provide it and why we're here is beyond us. MR. MOSTYN: Your Honor, you're holding

right now in front of you whether he waived his objections or not, which would save this Court some amount of time. But I'm happy to go confer with him and try to get this resolved and come back in here so we don't waste any more of your time. But an answer that says, "We hope to make an agreement to resolve this in the future," this is -I've done 20,000 first party cases. I've never had

anybody object to telling me who worked on the file. THE COURT: All right. Judge, if I might

MR. WORTHINGTON:

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interrupt?

As much as the motion to compel is, you know

interesting, we're here today only for the trial setting. And before the Court sends everyone out, I was simply going to ask if the Court might take up the trial setting motion so that -- because I'm not here for -- I have nothing to confer about. MR. MOSTYN: that, Your Honor. THE COURT: First of all, while it's still The plaintiffs agree with

fresh on my mind, let me go ahead and grant interrogatories number 1 and 2. They need a trial setting, so do you want to give them some dates? COURT COORDINATOR: them here ready. THE COURT: gentlemen over there. All right. Hand them to the Yes, sir. I've got

You've got some dates there you can

work off of, and then -MR. HINOJOSA: dates, Your Honor. We've talked about the

We -- we've got -- let me tell the

Court we have a basic fundamental problem here, Your Honor. 2010. This is an old -- an old incident, an old storm in There was a lot of damage done to the schools.

Some of it has been repaired, some of it has not been repaired, some of it needs to be repaired immediately but

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the school -- because of what happened in the last legislative session before this one, all the funding cut from the schools, there just wasn't any money to fix them. And so what we're concerned about, Your Honor, is that hurricane season starts in, I believe, June of this year. is due. If another -- and we're due. South Texas

Our concern is that if this case is tried after

the end of May of this year, we may be put in a situation where we will have another storm that will affect the school district and will affect our ability to determine what damages were caused by what storm in this -- in these schools, in these 700 plus buildings of the school district. So we've asked for a trial setting prior to the end of May, and we just can't get an agreement from them. So we're coming to the Court. If the Court can

just set the trial and let us begin the trial sometime before the end of the -- before the end of the school year the end of May, and then we'll get ready. We'll be coming

back if we have other discovery issues like this, but we'll wrap it up and get it ready for trial by that time, Your Honor. MR. WORTHINGTON: respond? Judge, if I might

The school district didn't file suit until I mean,

four-and-a-half years after the original storm.

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the suit was filed in December of 2012.

You've heard

testimony about hundreds and hundreds and hundreds of buildings involved. Somebody used the number 800. I

think there are 28, 26, 27 to 28 campuses. school district waited to file the suit.

I mean, the

It seems to me fair that we have enough time to at least do the discovery that's required in a case where you're alleging damage to 800 buildings, and May is simply too quick. We were going to ask for the

fall, September, a few extra months to give us hopefully enough time to do what needs to be done to fairly defend the case. But I think you've heard from some of the discovery requests today that this is a case involving -I think I may have produced 35,000 pieces of paper, more or less. And it's -- this is not a case that you can

fairly defend in a few months. And again, the district waited four and a half years from the date of the storm, over two years from the date that they claim the last decision was made regarding the claim, which I believe was September in 2010. I believe that's right. MR. MOSTYN: year. MR. WORTHINGTON: That's true. Well, it's been on file for a

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 on. It's not fair.

MR. MOSTYN:

It's been on file for a year.

So they're asking you to give them about a two-year window setting. That's too long. We're -- it sounds difficult,

but if they're going to come here and admit what they just -- well, they just admitted most of my case. lot of it's gone. in May. So a

We will -- we're ready to go to trial

There's absolutely no doubt that you can get this

case ready to go by May. They have -- if they haven't done anything on their side -- we're fully inspected. engineer reports. We have all We have

We have all estimated reports.

completed outside of this case much of the discovery already. And so we need, you know, a handful of that, but

we're ready. MR. WORTHINGTON: MR. McKINNEY: Judge -I have --

Just a minute.

MR. WORTHINGTON:

-- they've had several

years to prepare their case, and then they file it and say let's go to trial quickly on this case involving thousands -MR. HINOJOSA: No, Your Honor. It's not fair, Judge.

MR. WORTHINGTON:

MR. HINOJOSA:

If I may, Your Honor?

Come

These guys had an obligation to do what they were

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supposed to do. THE COURT: argument. All right. I've heard enough

Give me a setting in June. MR. McKINNEY: THE COURT: Judge, may I --

Go ahead. -- be heard briefly on that

MR. McKINNEY: one point? THE COURT:

Sure. We just heard that

MR. McKINNEY:

apparently there are estimators' reports and engineering reports and whatnot. I sent out a request for disclosure

and got responses on November 28th, less than two weeks ago. At that time, what I learned two weeks ago is they

have not determined who their experts are and they don't know what their damages are. So what we're going to see in this case and the reason why -- I appreciate the June setting. will not be enough time. June

We will not be able to get all

of the reports that we need and the time to look at each of those reports to see if there are buildings other than the buildings that we thought were at issue that are involved in this case, to get those buildings looked at and analyzed and reported on by our experts. I've been down this road before in the city of Galveston with only 188 properties as opposed to

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580-and-some-odd properties.

And it took 15 months for

appraisers to complete their appraisal in the city of Galveston on a number of buildings, about 25 percent of the size of the number of buildings involved in this case. A second issue is, Judge, June is the vacation month at the McKinney house. that's a big deal or not for the Court. I don't know if That's the only I have

month that I don't have any trial settings in.

filed a vacation letter every year for the last ten years in June. August. I can try this case in July. I can try it in

I can try it in September, October, November, any

time the Court wants. We didn't make our vacation last year for other reasons. It's a personal plea. I don't like having

to do that, but we can't be ready -- we can't be ready by June anyway. And I think a September setting is what We'll still be working ourselves to

makes the most sense.

death getting ready by September. And hopefully, hopefully -- and I'm serious about this -- within the next 60 days, we may well have taken care of most of the buildings that were discussed in the Borgman deposition. there and look at those. And if we can get good estimates -- and here's where the brunt is going to come. I don't want I mean, we do intend to get out

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opposing counsel's estimators.

They are not people who They are

have done work for Browning I.S.D. before.

lawsuit estimators, and they come in with numbers that are two and three and four times what the prevailing rates are. If Browning I.S.D. can identify its preferred contractors who have a history of work for Browning I.S.D. and have those companies come out and inspect and give estimates for repairs, we'll do a brief due diligence examination of those estimates; and I am highly confident that TWIA will pay those, plus the penalty that I discussed. MR. MOSTYN: respond? designate. Your Honor, can I just briefly

We have a lot of consulting experts, and we'll We're asking for a shorter period to get our We -- the appraisal process that

testifiers earlier.

Galveston -- Mr. McKinney is the 26th lawyer to defend TWIA, 26th in this litigation. The appraisal process in

Galveston did not start until July. But let me tell you the interesting thing. His appraiser, the umpire, and our appraiser all agree that the city of Galveston was owed $16 million. was a month ago, and they still refuse to pay it. And that On the

city of League City, this 60-day quick process, their appraiser agreed they owe us a million. Our appraiser

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said it was 3.7.

The umpire agreed it was 3.5 million. They continue to refuse

That was a month-and-a-half ago. to pay us.

So their -- I have little faith that we're Mr. McKinney We are

going to have a quick resolution, you know.

wants not to interfere with his June vacation. available, as we requested, in May. MR. HINOJOSA:

Your Honor, also if it's

between his vacation and the school children of Brownsville, Your Honor, he should be trumped. MR. McKINNEY: I agree with that. If --

I'm throwing that out there because I think that's just an additional -THE COURT: the other defendants. MR. CARRION: Reggie Warren. Judge, Albert Carrion for All right. Let me hear from

We have a conflict in May with five trial

settings and administrative trials for Danny Smith who's counsel for Reggie Warren in these cases. like it to be other than May. THE COURT: Okay. Your Honor, just to So we would

MR. MICHAEL RODRIGUEZ:

underscore Mr. Worthington's argument earlier, you heard from Judge Hinojosa this is a $30 million claim. They

want to force us to trial in four months basically on a $30 million claim with 800 buildings that need to be

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inspected.

And the discovery that they've been asking you

for, these E-mails, they don't have anything to do with my client. The horrible nature of those E-mails has nothing And I think there's a dual purpose

to do with my client.

for bringing those things up to engender anger with respect to this Court and their subsequent asking for a jury trial. We need time to work the case properly. MR. WORTHINGTON: And by the way -September or

MR. MICHAEL RODRIGUEZ:

October is a good time to set the case for trial, Your Honor. It's a very large case, as Judge Hinojosa We need time to do discovery. MR. HERNANDEZ: And, Your Honor, with

indicated.

regard to putting the timing into context, again, like Mr. Worthington said, this lawsuit wasn't filed until four years after the incident. Nothing occurred until we were

brought into the case because at the same time that they were filing this lawsuit, they were disqualifying TWIA's prior attorney in the Galveston case and had moved the court to incorporate this case into -- actually, it was a different -- the case was in Galveston, but Galveston wasn't the party. They had moved also to certify a class that included this case up there. So for all intents and

purposes, since December of last year, TWIA's attorney has

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been handcuffed by these folks because he was disqualified in all his litigation. So it wasn't until Mr. McKinney

substituted in in October that they even sent out their first set of discovery, written discovery. So for all intents and purposes, this case is two months old as opposed to a year old. too big to rush to trial. MR. MOSTYN: MR. HINOJOSA: Your Honor -The June date is acceptable And it's just

to us, at the beginning of June, Your Honor. THE COURT: say something? MR. MOSTYN: disqualify. There was never a motion to Okay. Somebody was going to

This case was never included with Galveston. MR. HERNANDEZ: I've got the pleadings

right here. THE COURT: All right. After hearing

everybody's argument, the Court will set it for trial the first week of August. MR. MOSTYN: Your Honor? What about vacation letters, I

Can we get a waiver of vacation letter?

don't know how you all do vacation letters. MR. HINOJOSA: files vacation letters. We want to make sure nobody

Apparently in other

jurisdictions, the moment that the courts allow lawyers to

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have a right to have a vacation letter -THE COURT: All right. Don't worry. I'm

finished with my vacation by that time. MR. McKINNEY: letter. I will not file a vacation

TWIA will not file a vacation letter in June. THE COURT: All right. First week in

August. COURT COORDINATOR: The first week, jury

week that we have is August the 11th, Your Honor. THE COURT: Is that Monday, jury selection? Yes, sir, that's jury

COURT COORDINATOR: selection. It is a new jury. THE COURT: announcements? COURT COORDINATOR: THE COURT: Both at 8:30. MR. WORTHINGTON: THE COURT:

August 11th for merits and

August the 7th.

August 7th for announcements.

Thank you, Judge.

August 7th at 8:30 for

announcements; August the 11th, 8:30, for merits. MR. EDUARDO RODDRIGUEZ: Honor. MR. MICHAEL RODRIGUEZ: THE COURT: May we be excused? Thank you, Your

You're excused. We're not involved

MR. EDUARDO RODDRIGUEZ:

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with the rest of the litigation. THE COURT: I understand. And y'all can go

in the hallway and discuss other interrogatories. END OF PROCEEDINGS

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THE STATE OF TEXAS: COUNTY OF CAMERON: CERTIFICATE OF COURT REPORTER I, PAM L. ESQUIVEL, Official Court Reporter in and for the 107th Judicial District Court of Cameron County, State of Texas, do hereby certify that the above and foregoing contains a true and correct transcription of all portions of evidence and other proceedings requested in writing by counsel for the parties to be included in this volume of the Reporter's Record, in the above-entitled and numbered cause, all of which occurred in open court or in chambers and were reported by me. I further certify that this Reporter's Record of the proceedings truly and correctly reflects the exhibits, if any, admitted by the respective parties. WITNESS MY OFFICIAL HAND on this the 17th day of December, 2013. /S/ Pam L. Esquivel PAM L. ESQUIVEL, Texas CSR, RMR, CRR Official Court Reporter 107th District Court 974 East Harrison Street Brownsville, Texas 78520 (956) 550-1470 Certificate No. 2369 Expiration Date: 12/31/14

PAM L. ESQUIVEL, CSR, RMR, CRR