2014 01 29 appellant's brief

2953072

Case No. 13-10939

In the United States Court of Appeals

for the Fifth Circuit

ALBERT G. HILL, III, INDIVIDUALLY, AND AS A BENEFICIARY OF THE MARGARET HUNT TRUST ESTATE, DERIVATIVELY ON BEHALF OF THE MARGARET HUNT TRUST ESTATE, INDIVIDUALLY, AS A BENEFICIARY OF THE HAROLDSON LAFAYETTE HUNT,

JR. TRUST ESTATE, AND DERIVATIVELY ON BEHALF OF THE HAROLDSON, Plaintiff-Appellant,

v.

WILLIAM SCHILLING, INDIVIDUALLY AND IN HIS CAPACITY AS A MEMBER OF THE ADVISORY BOARD M.H.T.E AND A MEMBER OF THE ADVISORY BOARD OF THE

H.H.T.E.; IVAN IRWIN, JR.; ALBERT G. HILL, JR.; ALINDA H. WIKERT; LYDA HILL; HEATHER V. WASHBURNE; ELISA M. SUMMERS; MARGARET HUNT TRUST ESTATE;

HARDOLSON LAFAYETTE HUNT JR. TRUST ESTATE; WILLIAM HERBERT HUNT, IN HIS CAPACITY AS THE PERSONAL REPRESENTATIVE OF THE ESTATE OF TOM HUNT; BRETT

RINGLE, INDIVIDUALLY AND IN HIS CAPACITY AS A MEMBER OF THE ADVISORY BOARD OF THE M.H.T.E.; JOHN W. CREECY, INDIVIDUALLY AND IN HIS CAPACITY AS

TRUSTEE OF THE H.H.T.E.; MARGARET KELIHER, INDIVIDUALLY AND IN HER CAPACITY AS TRUSTEE OF THE M.H.T.E. AND A MEMBER OF THE ADVISORY BOARD

OF THE H.H.T.E., Defendants-Appellees,

V. STEPHEN MALOUF; LISA BLUE; BARON & BLUE; LAW OFFICES OF STEPHEN F. MALOUF, P.C.; ALDOUS LAW FIRM; CHARLA ALDOUS; CHARLA ALDOUS, P.C.,

Intervenors Plaintiffs Appellees, --------------------------------------

CAMPBELL HARRISON & DAGLEY, L.L.P.; CALLOWAY, NORRIS, BURDETTE & WEBER, P.L.L.C.,

Intervenors Appellees.

Case: 13-10939 Document: 00512516055 Page: 1 Date Filed: 01/29/2014

2953072 - ii -

On Appeal from the United States District Court

for the Northern District of Texas No. 07-CV-02020-L, Sam A. Lindsay, Judge Presiding

BRIEF OF APPELLANT

Iian D. Jablon Aarti K. Wilson IRELL & MANELLA LLP 1800 Avenue of the Stars, Suite 900 Los Angeles, California 90067 [Tel.] (310) 277-1010 [Fax] (310) 203-7199 ATTORNEYS FOR APPELLANT


2953072 - iii -

CERTIFICATE OF INTERESTED PERSONS

NO. 13-10939

ALBERT G. HILL III, INDIVIDUALLY AS A BENEFICIARY OF THE MARGARET HUNT TRUST ESTATE, DERIVATIVELY ON BEHALF OF THE MARGARET HUNT TRUST ESTATE, INDIVIDUALLY AS A BENEFICIARY OF THE HAROLDSON LAFAYETTE

HUNT, JR. TRUST ESTATE, AND DERIVATIVELY ON BEHALF OF THE HAROLDSON LAFAYETTE HUNT, JR. TRUST ESTATE,

Plaintiff-Appellant, v.

MARGARET KELIHER, BRETT RINGLE, JOHN CREECY, WILLIAM SCHILLING, IVAN IRWIN JR. WILLIAM HERBERT HUNT, ALBERT G. HILL, JR. ALINDA H. WIKERT,

LYDA HILL, HEATHER H. WASHBURNE, AND ELISA H. SUMMERS, Defendants-Appellees.

The undersigned counsel of record certifies the following listed persons have

an interest in the outcome of this case. These representations are made in order

that the judges of this court may evaluate their possible recusal or disqualification.

1. Plaintiff/Appellant is represented in the Fifth Circuit by:

Iian D. Jablon Aarti K. Wilson IRELL & MANELLA LLP 1800 Avenue of the Stars, Suite 900 Los Angeles, California 90067


2953072 - iv -

Additional counsel who represented the Plaintiff/Appellant Albert G. Hill III

in the district court proceedings are:

Eric Chenoweth Autry Ross YETTER COLEMAN LLP 909 Fannin, Suite 3600 Houston, Texas 77010

Gregory S. Coleman Christian J. Ward Richard B. Farrer YETTER COLEMAN LLP 221 West 6th Street, Suite 750 Austin, Texas 78701

Mark E. Smith R. Wayne Gordon TOUCHSTONE BERNAYS JOHNSTON BEALL Smith &Stollenwerck LLP 4040 Renaissance Tower 1201 Elm Street Dallas, Texas 75270

Alan Roy Struble ALSTON & BIRD LLP 2200 Ross Avenue, Suite 3600 Dallas, Texas 75201

Brent R. Walker Charla G. Aldous ALDOUS LAW FIRM 2311 Cedar Springs Road, Suite 2200 Dallas, Texas 75201

Dana B. Taschner DANA TASCHNER ATTORNEY AT LAW 2049 Century Park East, Suite 1940 Los Angeles, California 90067

David W. Evans LAW OFFICES OF DAVID EVANS 2811 Turtle Creek Boulevard Suite 1600 Dallas, Texas 75219

Dean D. Hunt Matt R. Raley Michelle D. Pector BAKER & HOSTETLER LLP 1000 Louisiana, Suite 2000 Houston, Texas 77002


2953072 - v -

W. Mark Lanier Eugene R. Egdorf THE LANIER LAW FIRM PC 6810 FM 1960 West Houston, Texas 77069

James S. Renard Melissa S. Yost Michael J. Collins William A. Brewer, III BICKEL & BREWER 1717 Main Street, Suite 4800 Dallas, Texas 75201

John C. Hueston Michael G. Ermer IRELL & MANELLA LLP 840 Newport Center Drive, Suite 400 Newport Beach, California 92660

Stephen F. Malouf Jonathan Andrew Nockels THE LAW OFFICES OF STEPHEN F. MALOUF PC 3811 Turtle Creek Boulevard Suite 1600 Dallas, Texas 75219

Justin M. Campbell, III Kenneth J. Fair Robin L. Harrison Suzanne E. Goss CAMPBELL HARRISON & DAGLEY LLP 4000 Two Houston Center 909 Fannin Street, Suite 4000 Houston, Texas 77010

Lisa A. Blue BARON & BLUE 5956 Sherry Lane, Suite 1616 Dallas, Texas 75225

Elizabeth A. Scully Mark A. Cymrot BAKER & HOSTETLER LLP 1050 Connecticut Avenue NW Suite 1100 Washington, DC 20036

Marshall A. Camp IRELL & MANELLA LLP 1800 Avenue of the Stars, Suite 900 Los Angeles, California 90067

R. Dean Gresham GRESHAM PC 2311 Cedar Springs Road, Suite 200 Dallas, Texas 75201

Evan M. Janush THE LANIER LAW FIRM PC 126 East 56th Street Tower 56, 6th Floor New York, New York 10022


2953072 - vi -

Counsel who represented Defendant/Appellee Tom Hunt in the district court

proceedings are:

George W. Bramblett, Jr. Carrie L. Huff HAYNES & BOONE, LLP 2323 Victory Avenue, Suite 700 Dallas, Texas 75219

Joseph W. Wagner HAYNES & BOONE LLP 901 Main Street, Suite 3100 Dallas, Texas 75202

Counsel who represented Defendant/Appellee William Schilling in the

district court proceedings are:

George W. Bramblett, Jr. Carrie L. Huff David A. Dodds HAYNES & BOONE LLP 2323 Victory Avenue, Suite 700 Dallas, Texas 75219

David J. Beck Murray Fogler BECK REDDEN & SECREST LLP 1221 McKinney Street, Suite 4500 Houston, Texas 77010


Counsel who represented Defendant/Appellee Ivan Irwin, Jr. in the district

court proceedings are:

Harry M. Reasoner VINSON & ELKINS LLP 1001 Fannin Street, Suite 2500 Houston, Texas 77002

Michael L. Raiff GIBSON DUNN & CRUTCHER LLP 2100 McKinney Avenue, Suite 1100 Dallas, Texas 75201


2953072 - vii -

William D. Sims, Jr. VINSON & ELKINS LLP 2001 Ross Avenue, Suite 3700 Dallas, Texas 75201

Counsel who represented Defendant/Appellee Albert G. Hill, Jr. in the


J. Keith Benedict A G HILL PARTNERS LLC 1601 Elm Street, Suite 5000 Dallas, Texas 75201

Amanda R. Tyler Eric W. Pinker Kent D. Krabill LYNN TILLOTSON & PINKER LLP 750 N. St. Paul Street, Suite 1400 Dallas, Texas 75201

C. Gregory Shamoun Dennis M. Holmgren James R. Tucker Jonathan J. Cunningham SHAMOUN & NORMAN LLP 1775 Wittington Place Suite 200 LB 25 Dallas, Texas 75234

Michael L. Raiff James C. Ho GIBSON DUNN & CRUTCHER LLP 2100 McKinney Avenue, Suite 1100 Dallas, Texas 75201

Michael P. Lynn Jeremy A. Fielding Richard A. Smith LYNN TILLOTSON PINKER & COX LLP 2100 Ross Avenue, suite 2700 Dallas, Texas 75201

Robert H. Thomas Peter M. Jung STRASBURGER & PRICE 901 Main Street, Suite 4300 Dallas, Texas 75250


2953072 - viii -

Counsel who represented Defendant/Appellee Alinda H. Wikert in the


Donald E. Godwin Bruce W. Bowman, Jr. Israel R. Silvas Jenny L. Martinez Robert J. McGuire W. Ira Bowman GODWIN PAPPAS & RONQUILLO PC 1201 Elm Street, Suite 1700 Dallas, Texas 75270

Counsel who represented Defendant/Appellee Lyda Hill in the district court

proceedings are:

Frank N. Ikard, Jr. Lauren K. Davis Laurie Ratliff Mary E. Haught IKARD GOLDEN PC 400 West 15th Street, Suite 975 Austin, Texas 78701

James D. Brown Michael P. Massad WINSTEAD PC 5400 Renaissance Tower 1201 Elm Street Dallas, Texas 75201

Russell A. Devenport MCDONALD SANDERS 777 Main Street, Suite 1300 Fort Worth, Texas 76102

Kirk Todd Florence Jennifer L. Graf CROUCH & RAMEY, L.L.P. 2001 Ross Avenue, Suite 4400 Dallas, TX 75202


2953072 - ix -

Counsel who represented Defendant/Appellee Heather V. Washburne in the


Stewart H. Thomas Tom M. Dees, III HALLETT & PERRIN PC 2001 Bryan Street, Suite 3900 Dallas, Texas 75201

Counsel who represented Defendant/Appellee Elisa M. Summers in the



Counsel who represented Defendant/Appellee William Herbert Hunt in the


B. Patrick Shaw WOODWARD & SHAW 4849 Greenville Avenue, Suite 1111 Dallas, Texas 75206

Counsel who represented Defendant/Appellee Margaret Hunt Trust Estate in

the district court proceedings are:

George W. Bramblett, Jr. Carrie L. Huff HAYNES & BOONE LLP 2323 Victory Avenue, Suite 700 Dallas, Texas 75219



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Counsel who represented Defendant/Appellee Haroldson Lafayette Hunt Jr.

Trust Estate in the district court proceedings are:




Counsel who represented Defendant/Appellee Brett Ringle in the district


Stephen D. Susman Thomas W. Paterson SUSMAN GODFREY LLP First Interstate Plaza 1000 Louisiana Street, Suite 1500 Houston, Texas 77002



Stephen Shackelford, Jr. SUSMAN GODFREY LLP 901 Main Street, Suite 5100 Dallas, Texas 75202


2953072 - xi -

Counsel who represented Defendant/Appellee John W. Creecy in the district


Stephen D. Susman Thomas W. Paterson SUSMAN GODFREY LLP First Interstate Plaza 1000 Louisiana Street, Suite 1500 Houston, Texas 77002



Stephen Shackelford, Jr. SUSMAN GODFREY LLP 901 Main Street, Suite 5100 Dallas, Texas 75202

Counsel who represented Defendant/Appellee Margaret Keliher in the


Eric T. Stahl Frank L. Branson Quentin Brogdon LAW OFFICES OF FRANK L. BRANSON 4514 Cole Avenue, Suite 1800 Dallas, Texas 75205



Gilbert I. Low ORGAIN BELL & TUCKER P.O. Box 1751 470 Orleans Street Beaumont, Texas 77704


2953072 - xii -

Counsel who represented Intervenor Plaintiff Stephen Malouf in the district


Stephen F. Malouf Jonathan A. Nockels THE LAW OFFICES OF STEPHEN F. MALOUF, P.C. 3811 Turtle Creek Boulevard Suite 1600 Dallas, Texas 75219

Alan S. Loewinsohn Kerry F. Schonwald LOEWINSOHN FLEGLE DEARY LLP 12377 Merit Drive, Suite 900 Dallas, Texas 75251


Counsel who represented Intervenor Plaintiff Lisa Blue in the district court

proceedings are:



Counsel who represented Intervenor Plaintiff Erin Nance Hill in the district


Charla G. Aldous Brent Walker ALDOUS LAW FIRM 2311 Cedar Springs Road, Suite 2200 Dallas, Texas 75201

John H. Barr John H. House, Jr. Lucas Radney M. Forest Nelson BURT BARR & ASSOCIATES 203 East Colorado Boulevard Dallas, Texas 75222


2953072 - xiii -

Counsel who represented Intervenor Plaintiff Baron & Blue in the district




Counsel who represented Intervenor Plaintiff Law Offices of Stephen F.

Malouf, PC in the district court proceedings are:



Stephen F. Malouf Jonathan Andrew Nockels THE LAW OFFICES OF STEPHEN F. MALOUF PC 3811 Turtle Creek Boulevard Suite 1600 Dallas, Texas 75219

Counsel who represented Intervenor Plaintiff Aldous Law Firm in the



Charla G. Aldous Brent R. Walker ALDOUS LAW FIRM 2311 Cedar Springs Road, Suite 2200 Dallas, Texas 75201


2953072 - xiv -

Counsel who represented Intervenor Plaintiff Charla Aldous in the district



Charla G. Aldous ALDOUS LAW FIRM 2311 Cedar Springs Road, Suite 2200 Dallas, Texas 75201

Counsel who represented Intervenor Plaintiff Charla Aldous, PC in the




Counsel who represented Intervenor Plaintiff Thompson-Huffman Limited

Partnership in the district court proceedings are:

Jason Poe Lee H. Ayres S. Todd Parks AYRES WARREN SHELTON & WILLIAMS, L.L.C. 333 Texas Street, 14th Floor Shreveport, LA 71101


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Counsel who represented Respondent The Aldous Law Firm in the district




Counsel who represented Respondent R. Dean Gresham in the district court

proceedings are:



Counsel who represented Movant Ellen Flowers in the district court

proceedings are:

Ryan K. McComber A. Erin Dwyer FIGARI & DAVENPORT, L.L.P. 3400 Bank of America Plaza 901 Main Street, LB 125 Dallas, Texas 75202

Counsel who represented Movant Joyce Waller in the district court

proceedings are:

Michael P. Lynn Richard A. Smith LYNN TILLOTSON PINKER & COX LLP 2100 Ross Avenue, Suite 2700 Dallas, Texas 75201

Kent D. Krabill LYNN TILLOTSON & PINKER LLP 750 N. St. Paul Street, Suite 1400 Dallas, Texas 75201


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Robert H. Mow, Jr. Alison R. Ashmore Danny S. Ashby Jennifer B. Landry K&L GATES 1717 Main Street, Suite 2800 Dallas, Texas 75201

Counsel who represented Movant Michael V. Bourland in the district court

proceedings are:

David J. Goodman William R. Korb, Jr. Eric J. Millner BOURLAND WALL & WENZEL PC 301 Commerce Street, Suite 1500 Fort Worth, Texas 76102

Counsel who represented Movant Stewart H. Thomas in the district court

proceedings are:

C. Shawn Cleveland Emily C. McCall Matthew D. Orwig SNR DENTON US LLP 2000 McKinney Avenue, suite 1900 Dallas, Texas 75201

Counsel who represented Movant Tom M. Dees, III in the district court

proceedings are:

C. Shawn Cleveland Emily C. McCall Matthew D. Orwig SNR DENTON US LLP 2000 McKinney Avenue, suite 1900 Dallas, Texas 75201


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Counsel who represented Movant Shamoun & Norman, LLP in the district


Daniel D. Tostrud COBB MARTINEZ WOODWARD PLLC 1700 Pacific, Suite 3100 Dallas, Texas 75201

C. Gregory Shamoun Jonathan J. Cunningham Amanda M. Hoffmann SHAMOUN & NORMAN LLP 1775 Wittington Place Suite 200 LB 25 Dallas, Texas 75234

Angela M. Hough HERMES SARGENT BATES LLP 901 Main Street, Suite 5200 Dallas, Texas 75202

Counsel who represented Movant PBL Multi-Strategy Fund, L.P. in the


Lawrence S. Fischman Troy David Phillips GLAST PHILLIPS & MURRAY PC 2001 Bryan Street, Suite 3900 Dallas, Texas 75201

The Guardian ad Litem in the district court proceedings is:

Michael K. Hurst Dena DeNooyer Stroh GRUBER HURST JOHANSEN & HAIL LLP 1445 Ross Avenue, Suite 2500 Dallas, Texas 75202


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Counsel who represented Interested Party Ron Cresswell in the district court

proceedings are:

William A. Barr Sara N. Copeland LOCKE LORD BISSELL & LIDDELL LLP 2200 Ross Avenue, Suite 2200 Dallas, Texas 75201

Counsel who represented Interested Party Locke Lord Bissell & Liddell LLP

in the district court proceedings are:

William A. Barr Sara N. Copeland LOCKE LORD BISSELL & LIDDELL LLP 2200 Ross Avenue, Suite 2200 Dallas, Texas 75201

Counsel who represented Interested Party XTO Energy Inc. in the district


Mitchell M. Murphy Jeffrey C. King WINSTEAD PC 777 Main Street, Suite 1100 Fort Worth, Texas 76102

Counsel who represented Interested Party Jonathan Nockels in the district


Alan S. Loewinsohn LOEWINSOHN FLEGLE DEARY LLP 12377 Merit Drive, Suite 900 Dallas, Texas 75251


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Counsel who represented Interested Party Brent Walker in the district court

proceedings are:


Counsel who represented Interested Party David Evans in the district court

proceedings are:


Counsel who represented Interested Party Gresham PC in the district court

proceedings are:



Counsel who represented Receiver Daniel L. Jackson in the district court

proceedings are:

Talmage Boston WINSTEAD PC 5400 Renaissance Tower 1201 Elm Street Dallas, Texas 75270


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Counsel who represented Trustee Larry E. Jacobs in the district court

proceedings are:

Larry E. Jacobs BOYER JACOBS SHORT Nine Greenway Plaza, Suite 3100 Houston, Texas 77046

Counsel who represented Trustee Peggy Allison in the district court

proceedings are:

Carrie L. Huff HAYNES & BOONE LLP 2323 Victory Avenue, Suite 700 Dallas, Texas 75219

Counsel who represented Trustee Danny Bowlin in the district court

proceedings are:


Counsel who represented Trustee Chester Donnally in the district court

proceedings are:



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Counsel who represented Intervenor Campbell Harrison & Dagley LLP in

the district court proceedings are:

Robert W. Calloway Mary C. Burdette CALLOWAY NORRIS BURDETTE & WEBER 3811 Turtle Creek, Suite 400 Dallas, Texas 75219

Kenneth J. Fair Robin L. Harrison Suzanne E. Goss CAMPBELL HARRISON & DAGLEY LLP 4000 Two Houston Center 909 Fannin Street, Suite 4000 Houston, Texas 77010

Counsel who represented Intervenor Calloway, Norris, Burdette & Weber,

PLLC in the district court proceedings are:


Robert W. Calloway Mary C. Burdette CALLOWAY NORRIS BURDETTE & WEBER 3811 Turtle Creek, Suite 400 Dallas, Texas 75219

Counsel who represented Counter Claimant Lyda Hill in the district court

proceedings are:

Frank N. Ikard, Jr. Laurie Ratliff Mary E. Haught IKARD GOLDEN PC 400 West 15th Street, Suite 975 Austin, Texas 78701

James D. Brown Michael P. Massad WINSTEAD PC 5400 Renaissance Tower 1201 Elm Street Dallas, Texas 75201

Russell A. Devenport MCDONALD SANDERS 777 Main Street, Suite 1300 Fort Worth, Texas 76102


2953072 - xxii -

Counsel who represented Counter Defendant Albert G. Hill, III in the district


Mark E. Smith R. Wayne Gordon TOUCHSTONE BERNAYS JOHNSTON BEALL SMITH & STOLLENWERCK LLP 4040 Renaissance Tower 1201 Elm Street Dallas, Texas 75270

Alan Roy Struble ALSTON & BIRD LLP 2200 Ross Avenue, Suite 3600 Dallas, Texas 75201

Brent R. Walker Charla G. Aldous ALDOUS LAW FIRM 2311 Cedar Springs Road, Suite 2200 Dallas, Texas 75201

Dana B. Taschner DANA TASCHNER ATTORNEY AT LAW 2049 Century Park East, Suite 1940 Los Angeles, California 90067


Dean D. Hunt Elizabeth A. Scully Matt R. Raley Michelle D. Pector BAKER & HOSTETLER 1000 Louisiana, Suite 2000 Houston, Texas 77002

Eugene R. Egdorf Evan M. Janush W. Mark Lanier THE LANIER LAW FIRM PC 6810 FM 1960 West Houston, Texas 77069

James S. Renard Melissa S. Yost Michael J. Collins William A. Brewer, III BICKEL & BREWER 1717 Main Street, Suite 4800 Dallas, Texas 75201

John C. Hueston Michael G. Ermer IRELL & MANELLA LLP 840 Newport Center Drive, Suite 400 Newport Beach, California 92660

Stephen F. Malouf Jonathan Andrew Nockels THE LAW OFFICES OF STEPHEN F. MALOUF PC 3811 Turtle Creek Boulevard


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Suite 1600 Dallas, Texas 75219



Mark A. Cymrot BAKER & HOSTETLER LLP 1050 Connecticut Avenue NW Suite 1100 Washington, DC 20036

Marshall A. Camp IRELL & MANELLA LLP 1800 Avenue of the Stars, Suite 900 Los Angeles, California 90067


Gregory S. Coleman Christian J. Ward Richard B. Farrer YETTER COLEMAN LLP 221 West Sixth Street, Suite 750 Austin, Texas 78701

Counsel who represented Counter Claimant Alinda H. Wikert, III in the


Donald E. Godwin Bruce W. Bowman, Jr. Israel R. Silvas Jenny L. Martinez Robert J. McGuire W. Ira Bowman GODWIN PAPPAS & RONQUILLO PC 1201 Elm Street, Suite 1700 Dallas, Texas 75270


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Counsel who represented Counter Claimant Heather V. Washburne in the



Counsel who represented Counter Claimant Elisa M. Summers in the district



/s/ Aarti K. Wilson Aarti K. Wilson


2953072 - xxv -

STATEMENT REGARDING ORAL ARGUMENT

Appellant believes that oral argument will assist the Court in resolving this

case. The core issue in this appeal is straightforward: whether the district court

erred in ruling that successor trustees for a trust that was partitioned for

Appellants benefit in 2010 as part of the parties settlement in this action have no

right to obtain copies of the archives and permanent records of the original trust.

However, because the underlying litigation involved numerous parties and non-

party participants, was complex and protracted, and has generated a lengthy and

complicated record, oral argument will significantly benefit the Court in applying

the law on the complex record of this case.


TABLE OF CONTENTS

Page

2953072 - xxvi -

Certificate of Interested Persons ............................................................................ iii

Statement Regarding Oral Argument ................................................................. xxv

Statement of Jurisdiction ......................................................................................... 1

Statement of Issues for Review ............................................................................... 1

Introduction ............................................................................................................. 1

Statement of Facts and of the Case ......................................................................... 5

A. The Articles of Agreement of the Margaret Hunt Trust Estate ......... 5

B. The Underlying Litigation .................................................................. 6

C. The District Court Refuses to Order the Former Trustees to Provide the Archives and Permanent Records of the MHTE to the Successor Trustees ................................................................... 9

Standard of Review ............................................................................................... 13

Summary of the Argument .................................................................................... 13

Argument............................................................................................................... 14

I. The Successor Trustees of the Sub-Trusts Created From the MHTE Are Entitled to Copies of the Archives and Permanent Records of the MHTE. .................................................................................................. 14

A. The MHTEs Articles of Agreement Provide that a Successor Trustee Shall Have the Same Rights as the Prior Trustee. ............... 14

B. Texas Law Is Fully Consistent with the MHTEs Articles of Agreement with Respect to the Successor Trustees Rights. ........... 19

C. Hill III Presented Undisputed Evidence that the Successor Trustees Have a Legitimate Need to Access the Permanent Records of the MHTE. ..................................................................... 20


xxvii -

D. The Prior Trustees Are Not Being Asked to Provide a Trust Accounting. ..................................................................................... 24

E. The Other Objections Raised by Appellees Lack Merit. ................. 27

II. At a Minimum, Judge Soliss July 30, 2013 Order Should Be Vacated or Remanded to the District Court, Because He Was Apparently Operating under an Undisclosed Conflict. ................................................. 29

Conclusion ............................................................................................................ 31


TABLE OF AUTHORITIES

Page(s)

2953072 - xxviii -

CasesGoldin v. Bartholow,

166 F.3d 710 (5th Cir. 1999) ............................................................................... 13

Hill v. Schilling, 495 Fed. Appx. 480 (5th Cir. 2012) ................................................................... 10

Hoenig v. Texas Commerce Bank, N.A., 939 S.W.2d 656 (Tex. App. San Antonio 1996) .............................................. 23

Huie v. DeShazo, 922 S.W.2d 920 (Tex. 1996) ................................................................................ 28

In re Bradley, 501 F.3d 421 (5th Cir. 2007) ............................................................................... 28

Interfirst Bank-Houston, N.A. v. Quintana Petroleum Corp., 699 S.W.2d 864 (Tex. App. Houston [1st Dist.] 1985) .................................... 28

Liljeberg v. Health Servs. Acquisition Corp., 486 U.S. 847 (1988) ............................................................................................. 30

Rohrbach v. AT&T Nassau Metals Corp., 915 F. Supp. 712 (M.D. Pa. 1996) ....................................................................... 31

Statutes28 U.S.C. 1291 ......................................................................................................... 1

28 U.S.C. 1441(a) .................................................................................................... 1

Tex. Prop. Code 112.054 ...................................................................................... 19

Tex. Prop. Code 112.057 ...................................................................................... 19

Tex. Prop. Code 113.084 ...................................................................................... 19

Tex. Prop. Code 113.151 ...................................................................................... 25

Tex. Prop. Code 113.152 ...................................................................................... 25


Page(s)

2953072 - xxix -

RulesFed. R. Civ. P. 60(b) ................................................................................................ 11

Fed. R. Civ. P. 72 ..................................................................................................... 11


2953072 - 1 -

STATEMENT OF JURISDICTION

Defendants-Appellees invoked the district courts jurisdiction pursuant to 28

U.S.C. 1441(a), which allows the removal of any civil action brought in a State

Court of which the district courts of the United States have original jurisdiction.

This Court has jurisdiction over this appeal pursuant to 28 U.S.C. 1291.

STATEMENT OF ISSUES FOR REVIEW

1. Whether the district court erred in ruling that the successor trustees of a 1935 trust that was partitioned in 2010 for Appellants benefit are not entitled to obtain copies of the archives and permanent records of the partitioned trust.

2. Whether the district courts order refusing to grant the successor trustees access to the permanent records of the trust should be vacated and remanded because the district court judge recused himself without explanation shortly after entering the order, and thus was apparently operating under a conflict of interest at the time he entered the ruling.

INTRODUCTION

The underlying litigation was a bitter intra-family dispute over an

inheritance exceeding $1 billion, a significant part of which was held in the

Margaret Hunt Trust Estate (the MHTE), a trust that had been established in

1935 by legendary oil tycoon H.L. Hunt. After nearly two-and-a-half years of

litigation, the parties entered into a written settlement agreement in May 2010,

which was implemented by the district court in a final judgment entered in

November 2010.


2953072 - 2 -

Among other things, the final judgment divided the MHTE into several

separate and independent sub-trusts, including one such sub-trust for the benefit of

Appellant Albert G. Hill, III1 (the MHTE-Albert G. Hill III Trust, hereinafter the

MHTE-Hill III Trust), and another such sub-trust as to which Appellant is the

remainder beneficiary (the MHTE-Albert G. Hill, Jr. Income Beneficiary/Hill III

Termination Beneficiary Trust, hereinafter the Hill III Termination Trust). The

final judgment also appointed successor trustees to administer each of the various

sub-trusts.

The sub-trusts, with three limited exceptions described in the final judgment,

continue to be governed by the original 1935 Articles of Agreement and

Declaration of Trust that established the MHTE, and are expressly continuations of

the original 1935 trust.

The MHTEs Articles of Agreement provide that a successor trustee inherits

all of the rights and responsibilities of the former trustee. Among the rights and

responsibilities of the trustee are the duties to keep accurate records and books of

account regarding the trust, and to maintain the archives and permanent records

of the trust. (ROA.17765) (Record Excerpts (RE) Tab 5).

1 Appellant is referred to herein as Hill III. Hill III is sometimes referred to in materials filed in the district court proceedings as Al III. Likewise, Hill IIIs father, Albert G. Hill, Jr., is referred to herein as Hill Jr., but is sometimes referred to in materials filed in the district court as Al Jr.


2953072 - 3 -

After the MHTE was partitioned as required by the final judgment in 2010,

the successor trustees of the MHTE-Hill III Trust and the Hill III Termination

Trust requested that Appellees make the books and records of the MHTE available

for copying by the successor trustees. Appellees refused, contending that the

successor trustees for the sub-trusts affiliated with Hill III have no right to obtain

copies of the archives and permanent records of the MHTE.

With the support of the successor trustees, Hill III thereafter moved the

district court for an order compelling Appellees to either make the books and

records of the MHTE available for copying by the successor trustees, or to make

the records available for copying by Hill III personally. The district court denied

that motion, reasoning that (1) nothing in the final judgment or in the MHTEs

Articles of Agreement specifically requires that the former trustee of the MHTE

provide copies of the trusts books and records to a successor trustee, and (2) Hill

III had agreed in the parties settlement agreement that the former trustees would

not be required to furnish any trust accounting in connection with the settlement,

and thus Hill III was precluded from obtaining the books and records of the trust.

As explained more fully below, the district courts ruling on Hill IIIs

motion is erroneous. Under the terms of the Articles of Agreement and under

Texas law, a successor trustee inherits all of the same rights, powers, duties, and

obligations of his or her predecessor. In this case, such rights necessarily include


2953072 - 4 -

reasonable access to the archives and permanent records of the trust materials

that the Articles of Agreement clearly state belong to the trust, and not to the

trustee personally. Moreover, neither Hill III nor the successor trustees have

requested that the prior trustees provide an accounting the successor trustees

have simply requested copies of the permanent records of the trust, which is

entirely different than requesting that the prior trustee prepare a trust accounting.

Further, there is no support whatsoever for the district courts implicit ruling that

successor trustees for some of the sub-trusts created from the MHTE are entitled to

complete copies of the books and records of the original trust, but successor

trustees for other sub-trusts (i.e., those affiliated with Hill III) are not entitled to

those same materials.

For all of these reasons, and as discussed more fully below, the district court

erred in denying Hill IIIs motion to compel Appellees to produce copies of the

MHTEs books and records to the successor trustees.

In the alternative, this Court should vacate the order at issue and remand Hill

IIIs motion for consideration by the new district court judge assigned to hear this

action based upon the fact that the district court judge who decided the motion that

gives rise to this appeal recused himself, without explanation, shortly after entering

the order that is being appealed from, and was thus apparently operating under a


2953072 - 5 -

conflict of interest at the time the order at issue which is intemperate and

disparaging of Hill III was entered.

STATEMENT OF FACTS AND OF THE CASE

A. The Articles of Agreement of the Margaret Hunt Trust Estate

In 1935, oil tycoon H.L. Hunt, then reportedly the wealthiest man in the

United States, established irrevocable trusts for six of his children, including

Margaret Hunt Hill (Margaret, the original beneficiary of the Margaret Hunt

Trust Estate (MHTE)) and Hassie Lafayette Hunt Jr. (the original beneficiary of

the Haroldson Hunt Trust Estate (HHTE)).

The Articles of Agreement and Declaration of Trust establishing each of the

MHTE and HHTE were substantively identical and set forth guidelines for the

administration of the trusts. The Articles of Agreement of the MHTE establish the

duties of the trustee. Among other things, the trustee is required to

keep, or cause to be kept, faithful records and books of account, reflecting at all times the true conditions of the affairs of said Trust Estate, which said records and books of account shall at all times be open for the inspection of the other two members of the Advisory Board, and as near after the close of each calendar year as is reasonably possible the Trustee shall have said books and records audited by a Certified Public Accountant and a report of said audit filed as a part of the archives and permanent records of said Trust Estate . . . . (ROA.17765) (emphasis added) (RE Tab 5).


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The Articles of Agreement further provide that when the trustee is replaced,

the successor trustee shall succeed to the same rights and powers and be subject to

the same duties and liabilities as his predecessor, with such rights vesting

immediately upon being elected as successor trustee. (ROA.17761) (RE Tab 5).

B. The Underlying Litigation

The factual background of this litigation has been summarized at length for

this Court in connection with Hill IIIs original appeal from the final judgment.

See Hill v. Schilling, Case No. 11-10348, Appellants Br. at 3-15 (5th Cir., filed

Oct. 17, 2011). In brief: In 2005, Hill IIIs father, Albert G. Hill, Jr. (Hill Jr.),

signed an irrevocable disclaimer of a portion of his interest in the MHTE in favor

of his children. When Margaret died in 2007, Hill Jr.s interest in the MHTE

vested and, by virtue of the disclaimer Hill Jr. had signed in 2005, Hill Jr.s

children (including Hill III) became vested, current beneficiaries of the MHTE.

Apparently hoping to avoid certain tax consequences that would result from

the 2005 disclaimer, shortly after Margarets death in 2007, Hill Jr. executed an

updated but substantially similar disclaimer in favor of his children (including Hill

III). Soon thereafter, however, Hill Jr. took the position that the disclaimer he had

signed in 2005 was invalid based on the contention that Hill Jr. had purportedly

been incompetent when he signed it. (See ROA.10746). Hill Jr. also took the

position that his 2007 disclaimer had been signed in 2005, at a time when he was


2953072 - 7 -

purportedly incompetent. (See ROA.10748). In late 2007, Hill Jr. filed pleadings

in state court in Texas seeking to establish that the disclaimers he had signed were

invalid, and that Hill III was therefore not a beneficiary of the MHTE.

(ROA.11587-94).

In response, on November 8, 2007, Hill III filed a suit in the 14th Judicial

District of Dallas County, alleging that his father and others had committed

violations of the federal Racketeer Influenced and Corrupt Organizations Act

(RICO), fraud, breach of fiduciary duty, and other torts in connection with the

MHTE and the HHTE. (ROA.186-231). Hill IIIs lawsuit, which the Defendants

removed to the United States District Court for the Northern District of Texas on

December 3, 2007, sought various forms of relief, including a declaration that Hill

III was a beneficiary of both the MHTE and the HHTE. (ROA.155-61, 229-30).

After nearly two and a half years of litigation, the parties entered into a

written Global Settlement and Mutual Release Agreement (the GSA or

Settlement Agreement) that was filed with the district court in May 2010.

(ROA.Sealed, Dkt.879). Among the agreed-upon settlement terms was that the

MHTE would be divided pro rata into separate sub-trusts for each of the current

beneficiaries, including Hill III. (ROA.Sealed, Dkt.879 at 7, 17) (RE Tab 10). The

parties agreed that each sub-trust would be separately administered by new

successor trustees in accordance with the 1935 Articles of Agreement of the


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MHTE. (ROA.Sealed, Dkt.879 at 17, 23) (RE Tab 10). The parties also agreed

that the outgoing trustees of the MHTE would be released for failure to furnish

any trust accounting for either of the MHTE or the HHTE, for time periods before

and including the resignation dates of the trustees and advisory board members.

(ROA.Sealed, Dkt. 879 at 24-25) (RE Tab 10).

On November 8, 2010, after the parties had submitted lengthy briefing

concerning implementation of the Settlement Agreement, the district court entered

its final judgment (the Final Judgment) that purported to implement the

Settlement Agreement. As required by the Settlement Agreement, the Final

Judgment divided the MHTE into several sub-trusts as of the date of Margarets

death (June 14, 2007), and appointed successor trustees to oversee each of the

sub-trusts. (ROA.Sealed, Dkt.999 at 7-20). One such sub-trust was created for the

benefit of Hill III (the MHTE-Hill III Trust) and another such sub-trust was created

as to which Hill III is the remainder beneficiary (Hill III Termination Trust).

(ROA.Sealed, Dkt.999 at 7-8, 12-14, 20) (RE Tab 9).

The Final Judgment provides that, with three minor modifications that are

not relevant to this appeal, each of the sub-trusts created from the MHTE shall be

governed by the terms and provisions of the [1935] Articles of Agreement and

Declarations of Trust establishing the MHTE . . . . (ROA.Sealed, Dkt.999 at 2,

24-25) (RE Tab 9).


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C. The District Court Refuses to Order the Former Trustees to Provide the Archives and Permanent Records of the MHTE to the Successor Trustees

Due to the passage of time between the parties settlement in May 2010 and

the district courts entry of the Final Judgment in November 2010, shortly after the

Final Judgment was entered, Hill III filed a motion requesting that the district court

alter or amend the Final Judgment to require the former trustees of the MHTE to

provide him with a trust accounting for the period between May and November

2010. (ROA.Sealed, Dkt.1050 at 14-15). The district court rejected that request,

citing the provision of the Settlement Agreement which states that the former

trustees are released for any failure to furnish any trust accounting for either the

MHTE or the HHTE. (ROA.Sealed, Dkt.1099 at 11 (RE Tab 8); see also

ROA.Sealed, Dkt.879 at 24-25 (RE Tab 10)).

Hill III then filed an appeal to this Court relating to certain provisions of the

Final Judgment that deviated from the parties Settlement Agreement. (See

ROA.17486-87; Hill v. Hunt, et al., 5th Cir. Case No. 11-10348). While that

appeal was pending, Hill III learned that the district court judge who had been

presiding over the action since 2007 (the Honorable Reed OConnor) apparently

had an undisclosed conflict of interest both at the time the Settlement Agreement

had been signed and when the Final Judgment had been entered. In March 2012,

Hill III unsuccessfully moved to recuse Judge OConnor, and then appealed the


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denial of his motion to recuse to this Court. (ROA.Sealed, Dkt. 1257, ROA.17829-

83; Hill v. Hunt, et al., 5th Cir. Case No. 12-10620). Hill IIIs two appeals were

consolidated,2 and this Court ultimately ruled against Hill III. Hill v. Schilling, 495

Fed. Appx. 480, 483 (5th Cir. 2012). Soon after the mandate issued, however,

Judge OConnor abruptly recused himself without explanation and was eventually

replaced by the Honorable Jorge A. Solis. (ROA.149, 18112-13).

Meanwhile, in December 2010, the MHTE had been divided into sub-trusts

as required by the parties Settlement Agreement and the Final Judgment.

(ROA.Sealed, Dkt. 1053). After the division took place, the successor trustees of

the MHTE-Hill III Trust and the Hill III Termination Trust requested that the

predecessor trustees of the MHTE provide the successor trustees with copies of (or

access to) the books and records of the MHTE. (ROA.17786-99). Those requests

were rejected. (ROA.17788, 17794-95) (RE Tab 7). Accordingly, on March 5,

2012, Hill III filed a motion to compel the former trustees of the MHTE to make

the books and records of the trust available either to the successor trustees or to

Hill III personally, which motion was supported by declarations submitted by the

2 Hill III also filed a separate appeal in a related case (Campbell, Harrison & Dagley, et al. v. Hill, et al., 5th Cir. Case No. 12-10417), which appeal was also consolidated with his two appeals in this action. See Hill v. Hunt, et al., 5th Cir. Case No. 11-10348, Order (entered July 25, 2012).


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successor trustees.3 (ROA.17738-99). Hill IIIs motion to compel was joined by

the guardian-ad-litem who had been appointed by the district court to represent the

interests of Hill IIIs minor children. (ROA.Sealed, Dkt. 1281 at 2-4).

The magistrate judge who was assigned by the district court to consider Hill

IIIs motion to compel found that it is common practice for trustees to willingly

provide the trusts books and records to successor trustees in the usual

circumstances, and that [i]n all likelihood, the drafters of the MHTE trust

agreement contemplated that such books and records would naturally be given to

any successor trustees. (ROA.17980-81) (RE Tab 4). Nonetheless, the magistrate

entered an order on January 15, 2013 denying Hill IIIs motion. (ROA.17982) (RE

Tab 4).

Thereafter, Hill III timely filed objections pursuant to Federal Rule of Civil

Procedure 72 seeking review of the magistrate judges ruling by the district court.4

(ROA.Sealed, Dkt.1343). On July 30, 2013, Judge Solis entered his first and only

substantive order in the action, overruling all of Hill IIIs objections to the

3 The Final Judgment appointed Hill III as an Advisory Board member of the MHTE-Hill III Trust. (ROA.Sealed, Dkt.999 at 20) (RE Tab 9). Hill III therefore had standing to bring the motion to compel in his own right, as the MHTEs Articles of Agreement provide that Advisory Board members have unfettered access to the records of the trust. (ROA.17765) (RE Tab 5). 4 A party is entitled to have the district court review a magistrate judges ruling pursuant to Rule 72. Here, however, the magistrate judges ruling at issue was entered after the Final Judgment. Accordingly, Hill III objected to the magistrates ruling both under Rule 72 and under Federal Rule of Civil Procedure 60(b).


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magistrates order. (ROA.18175-85) (RE Tab 3). The district court ruled that

[t]he MHTE Articles of Agreement do not provide successor trustees an absolute

right to inspect, view, see, peek at, peruse, skim, scan, gaze upon, or otherwise

examine an outgoing trustees books and records. (ROA.18181) (RE Tab 3).

Likewise, the district court ruled that the MHTE Articles of Agreement contain no

express provision which directs an outgoing trustee to confer even a single book,

record, or leaf of paper to any successor trustee. (ROA.18180) (RE Tab 3). The

district court further reasoned that even assuming the former trustees might

otherwise have had an obligation to turn over the books and records to a successor

trustee, the provision of the Settlement Agreement that released the former trustees

from providing a trust accounting effectively obviated any such requirement.

(ROA.18180-81) (RE Tab 3).

Hill III timely filed notice of this appeal from the district courts order

denying his motion to compel. (ROA.18186-87) (RE Tab 2). Approximately one

month following Hill IIIs notice of appeal, Judge Solis recused himself from the

underlying litigation without providing the parties with any explanation for his

decision to recuse. (ROA.18192).


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STANDARD OF REVIEW

The primary issue presented on this appeal is whether the district court

properly interpreted the MHTEs Articles of Agreement with respect to the

successor trustees rights to obtain copies of the archives and permanent records

of the trust. A trust instrument is interpreted as a contract, and like the

interpretation of a contract the construction of a trust instrument is a question of

law. Therefore, the interpretation of a trust instrument is reviewed de novo.

Goldin v. Bartholow, 166 F.3d 710, 715 (5th Cir. 1999).Accordingly, the

appropriate standard of review with respect to Hill IIIs appeal from the district

courts July 30, 2013 order is de novo.

SUMMARY OF THE ARGUMENT

This appeal raises a straightforward issue of law: Do the successor trustees

of the sub-trusts created from the MHTE pursuant to the parties Settlement

Agreement and the Final Judgment have a right to obtain copies of the archives

and permanent records of the MHTE? As a matter of logic and plain English, the

answer to that question is clearly yes. Moreover, there is no justification

whatsoever for the district courts implicit ruling that successor trustees for certain

of the sub-trusts that were created from the MHTE are entitled to complete copies

of the books and records of the MHTE, but that successor trustees for other sub-

trusts created from the MHTE (i.e., those sub-trusts of which Appellant is a


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beneficiary) are not entitled to those same records. Simply put, the district courts

ruling was erroneous as a matter of law, and should be reversed.

In the alternative, this Court should vacate the order at issue and remand Hill

IIIs motion for consideration by the new district court judge assigned to hear this

action because the district judge who decided the motion that gives rise to this

appeal was apparently operating under a conflict of interest when the order at issue

was entered. That judge recused himself, without explanation, shortly after

entering the order that is being appealed from, and the order itself is replete with

statements that are disparaging of Appellant.

ARGUMENT

I. The Successor Trustees of the Sub-Trusts Created From the MHTE Are Entitled to Copies of the Archives and Permanent Records of the MHTE.

A. The MHTEs Articles of Agreement Provide that a Successor Trustee Shall Have the Same Rights as the Prior Trustee.

The May 2010 Settlement Agreement and November 2010 Final Judgment

in this action required that the MHTE be divided into separate sub-trusts for the

benefit of the then-existing beneficiaries of the trust. (See ROA.Sealed, Dkt.879 at

17; ROA.Sealed, Dkt.999 at 7-20). In connection with that division, the assets of

the MHTE were required to be divided pro rata between the sub-trusts according to

the proportional interests of the beneficiaries. (ROA.Sealed, Dkt.879 at 17;

ROA.Sealed, Dkt.999 at 7-20). The Final Judgment further required that the sub-


2953072 - 15 -

trusts would continue to be governed by the MHTEs original Articles of

Agreement, with three very limited (and irrelevant, for purposes of this appeal)

exceptions. (ROA.Sealed, Dkt.999 at 24-25) (RE Tab 9). In other words, the

parties Settlement Agreement and the Final Judgment provide that the sub-trusts

are simply continuations of the MHTE, and will be treated for tax and other

reasons as though the original 1935 trust had remained intact and undisturbed.

(ROA.Sealed, Dkt.879 at 23-24 (RE Tab 10); ROA.Sealed, Dkt.999 at 7-8 (RE

Tab 9).

The MHTEs Articles of Agreement require the trustee to maintain archives

and permanent records of the trust, which records and books of account shall at

all times be open for the inspection of the other two members of the Advisory

Board.5 (ROA.17765) (RE Tab 5). The Articles of Agreement further provide

that the trustee shall continue to serve until replaced by a successor trustee, and

that immediately upon election, the successor trustee shall step into the shoes of

the prior trustee with respect to all rights and duties, including duties relating to the

administration of the books and records of the trust. (ROA.17761 (Article I,

Section 2 noting that his successor shall succeed to the same rights and powers

and be subject to the same duties . . . as his predecessor.)) (RE Tab 5).

5 The Articles of Agreement provide that the MHTE shall have a three-member Advisory Board, consisting of the Trustee and two other members. (ROA.17765) (RE Tab 5).


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Notwithstanding the clear and unambiguous language cited above, the

district court ruled that the successor trustees of the two MHTE sub-trusts for

which Hill III is either a current or future beneficiary are not entitled to obtain

copies of the archives and permanent records of the MHTE from the predecessor

trustees. The district court reasoned that (a) the MHTEs Articles of Agreement do

not specifically mention a former trustee delivering the records of the trust to a

successor trustee, and (b) the successor trustees duty with respect to trust records

is purportedly limited to maintaining permanent records henceforth i.e.,

commencing after the successor trustee is appointed. (ROA.17980-81, 18180) (RE

Tabs 3 & 4).

Respectfully, the district courts ruling is flatly inconsistent with the Articles

of Agreement, Texas law, and common sense. As noted above, the Articles of

Agreement require the trustee to maintain archives and permanent records of the

trust. (ROA.17765) (RE Tab 5). The terms archives6 and permanent7 are

6 For example, the Merriam-Webster Dictionary defines an archive as a place in which public records or historical materials (such as documents) are kept. Merriam Webster Dictionary, http://www.merriam-webster.com/dictionary/archive (emphasis added). Likewise, the American Heritage Dictionary defines an archive as [a] place or collection containing records, documents, or other materials of historical interest. http://ahdictionary.com/word/search.html?q=archive. Similarly, the Oxford Dictionary defines archive as a collection of historical documents or records providing information about a place, institution, or group of people. Oxford Dictionaries, http://www.oxforddictionaries.com/us/definition/english/archive?q=archive.


2953072 - 17 -

commonly used words with well-established definitions. Applying those well-

established definitions, the plain language of the Articles of Agreement requires

the acting trustee which would include any successor trustee to maintain

permanent, historical records of the trust, which records must at all times be open

for the inspection of the trusts three-member Advisory Board. (ROA.17765) (RE

Tab 5). The successor trustees duty to maintain and make available for inspection

the archives and permanent records commences immediately upon the

successor trustee being elected. (ROA.17761) (RE Tab 5).

The Articles of Agreement are equally clear that the archives and

permanent records belong to the trust, not to the trustee. Indeed, that is expressly

what Article I, Section 10 of the Articles of Agreement provides when it requires

the acting trustee to have the books and records of the trust audited annually, and

have the report or said audit filed as part of the archives and permanent records of

said Trust Estate. (ROA.17765) (RE Tab 5).

7 The Merriam Webster Dictionary defines permanent as lasting or continuing for a very long time or forever; not temporary or changing. Merriam Webster Dictionary, http://www.merriam-webster.com/dictionary/permanent. The American Heritage Dictionary defines permanent as [l]asting or remaining without essential change. American Heritage Dictionary, http://ahdictionary.com/ word/search.html?q=permanent. The Oxford Dictionary defines permanent as lasting or intended to last or remain unchanged indefinitely. Oxford Dictionaries, http://www.oxforddictionaries.com/us/definition/english/permanent?q=permanent.


2953072 - 18 -

Nothing in the Articles of Agreement suggests, or could be read to imply,

that when a successor trustee is elected, the archives and permanent records of

the trust shall be abandoned, and that the successor trustee shall only maintain

records henceforth. Indeed, the term henceforth does not appear anywhere in

the relevant provisions of the Articles of Agreement the district court simply

inserted this limitation of its own accord. (ROA.17980-81, 18180) (RE Tabs 3 &

4).

Equally importantly, nothing in the Articles of Agreement or in the parties

Settlement Agreement supports the conclusion that successor trustees for certain of

the sub-trusts created from the MHTE shall have access to the permanent records

of the trust, but that successor trustees for other sub-trusts shall be denied access.

But that is exactly the unwarranted and unprecedented dichotomy that the district

court created by ruling that the successor trustees for the two sub-trusts of which

Hill III is a current or remainder beneficiary are not entitled to copies of the

MHTEs records since it is undisputed that successor trustees for other sub-trusts

created under the Final Judgment do have those very materials. (ROA.Sealed,

Dkt.1359 at 7; see also ROA.Sealed, Dkt.1288 at 8 n.6). Both the trust agreement

itself and basic fairness dictate that the successor trustees for the sub-trusts

affiliated with Hill III must be given the same access to the records of the trust as

the successor trustees for the other sub-trusts created from the MHTE.


2953072 - 19 -

B. Texas Law Is Fully Consistent with the MHTEs Articles of Agreement with Respect to the Successor Trustees Rights.

The conclusion that a successor trustee is entitled to copies of the historical

records of the MHTE is not only clear from the Articles of Agreement, but is also

amply supported by the Texas laws that the district court relied upon in creating

the sub-trusts. (See ROA.Sealed, Dkt.999 at 7) (RE Tab 9). For example, Texas

Property Code section 112.057 permits a trustee to divide a trust only if the terms

of the separate trusts [are] identical to the terms of the original trust. Likewise,

Texas Property Code section 112.054 permits a judicial modification of an

existing trust provided that it conforms as nearly as possible to the probable

intention of the settlor. Consistent with these statutory provisions, the Final

Judgment makes clear that the sub-trusts are simply proportionate divisions of the

existing trust estate governed, with very limited exceptions, by the original 1935

Articles of Agreement. (See ROA.Sealed, Dkt.999 at 7-20, 24-25). In other

words, the sub-trusts constitute a continuation, not a termination, of the MHTE.

Moreover, as with the Articles of Agreement, the Texas Property Code

provides that a successor trustee has the same rights, powers, authority, discretion,

and title to trust property as was conferred on the prior trustee. Tex. Prop. Code

113.084. Simply put, under Texas law, a successor trustee steps into the shoes of

the former trustee. Thus, if the former trustee had access to the archives and


2953072 - 20 -

permanent records of the MHTE, the successor trustee must have the same right to

access those archives and permanent records.

The district court faulted Hill III for failing to cite any Texas case in which a

predecessor trustee was ordered to turn over the books and records of the trust to a

successor trustee. (ROA.18182) (RE Tab 3). However, it is unsurprising that Hill

III was unable to locate any such case given that, as the magistrate judge

acknowledged, the turnover of the trusts records to the successor trustee would be

expected to happen as a matter of course. (ROA.17980) (RE Tab 4). Hill III

respectfully submits that it is far more significant that there is no Texas authority

that supports the district courts troubling conclusions that (a) a prior trustee has no

obligation to provide the trusts books and records to a successor trustee, and (b)

when a trust is divided into separate sub-trusts, successor trustees for some sub-

trusts but not others are entitled to copies of the trusts records. Given the lack of

any Texas state court cases supporting the obviously flawed conclusions reached

by the district court, this Court would be setting a perilous and unfortunate

precedent if it were to affirm the district courts ruling.

C. Hill III Presented Undisputed Evidence that the Successor Trustees Have a Legitimate Need to Access the Permanent Records of the MHTE.

As discussed above, the plain language of the MHTEs Articles of

Agreement require the trustee (including a successor trustee) to maintain historical


2953072 - 21 -

records of the trust. This requirement makes perfect sense. The MHTE was

established in 1935 and was written to continue until the Death of Margaret

Hunt . . . and for twenty-one years after . . . her death that is, the trust was

intended to last (and has lasted) for decades. (ROA.17767-68) (RE Tab 5).

Maintaining permanent trust records throughout the life of the trust would

therefore be important, if not essential, to simply by way of example establish

the trusts tax basis in property acquired over time, and to keep track of the trusts

various different investments and their performance.8

Nothing in either the Articles of Agreement, the Final Judgment, or Texas

law requires the successor trustees, or Hill III personally, to make any showing of

need in order for the successor trustees to obtain access to the records of the

MHTE. Nonetheless, Hill III and the successor trustees presented largely

uncontested evidence to the district court that the successor trustees ability to

effectively administer the sub-trusts is being hampered by their lack of access to

the permanent records of the MHTE. (ROA.17786-99). For example, the

successor trustees testified by declaration that they would not be able to

definitively ascertain the tax basis for a significant portion of the assets of the sub- 8 The magistrate judge who initially denied Hill IIIs original motion acknowledged that the original intent of the drafter of MHTEs Articles of Agreement was likely to provide copies of the books and records to the successor trustee. (ROA.17980 (In all likelihood, the drafters of the MHTE trust agreement contemplated that such records and books would naturally be given to any successor trustees.)) (RE Tab 4).


2953072 - 22 -

trusts at issue namely, the MHTEs ownership of Exxon Mobil securities

without access to the MHTEs historical books and records.9 (ROA.17788, 17795)

(RE Tab 7).

Separately and additionally, Hill III submitted evidence showing that having

access to the permanent records of the trust was critical in order for the successor

trustees, and for Hill III personally, to ascertain whether the sub-trusts had been

correctly funded as required by the Settlement Agreement and Final Judgment. In

this regard, Hill III offered uncontested evidence that in connection with dividing

certain illiquid assets among the sub-trusts as required by the Final Judgment, the

former trustees had failed to disclose certain assets that Hill III had subsequently

managed to locate himself by reference to secondary sources such as public

records. (ROA.17756) (RE Tab 6). Confronted with the secondary evidence

unearthed by Hill III, the former trustees later admitted that certain of the

information they had provided about the assets that were being divided among the

9 The district court found that the successor trustees concerns on this point are unfounded because the prior trustees had produced a single document, prepared by a non-party, purporting to state the MHTEs tax basis in the Exxon securities. (ROA.18181) (RE Tab 3). However, the successor trustees were aware of the document referenced by the district court when they testified that additional information was needed in order to definitively ascertain the tax basis of assets valued in the tens of millions of dollars. (ROA.17790, 17797). Accordingly, the district courts finding on this issue was not supported by the record, and is clearly erroneous.


2953072 - 23 -

sub-trusts had been inaccurate. (ROA.Sealed, Dkt.1207 at 2, 4-8; ROA.Sealed,

Dkt.1215 at 2, 4-8).

Simply put, access to the archives and permanent records of the MHTE is

important, and likely essential, in order for the successor trustees to properly carry

out their obligations with respect to the sub-trusts. (ROA.17786-88, 17794-95)

(RE Tab 7). In this regard, the case of Hoenig v. Texas Commerce Bank, N.A. is

instructive. 939 S.W.2d 656 (Tex. App. San Antonio 1996, no writ). In that

case, a successor trustee obtained the records of the trust from the outgoing trustee,

and subsequently determined from those records that the prior trustee had

negligently failed to collect rents for more than ten years on properties owned by

the trust. Id. at 658-59. Ironically, the former trustee then contended that the

successor trustee should be held jointly liable to the beneficiary on the theory that

the successor trustee should have immediately spotted the error. The court rejected

this theory for various reasons, including that the successor trustee had promptly

spotted and taken steps to address the issue. Id. at 662-63. Hoenig is illustrative

both of the fact that a successor trustee necessarily has access to the records of the

trust, and also of the reasons why a successor trustees access to trust records is

vitally important.


2953072 - 24 -

In short, here the record more than amply shows that the successor trustees

of the sub-trusts created from the MHTE have a legitimate need for access to the

permanent records of the trust.

D. The Prior Trustees Are Not Being Asked to Provide a Trust Accounting.

In its order denying Hill IIIs motion to compel, the district court reasoned

that even if the successor trustees would otherwise be entitled to the records of the

MHTE, here Hill III has supposedly waived any right to obtain those records

because he agreed in the Settlement Agreement to release the prior trustees for any

claim relating to failure to furnish any trust accounting for either of the MHTE or

the HHTE, for time periods before and including the resignation dates of the

trustees and advisory board members. (ROA.18182 (citing ROA.Sealed, Dkt.999

at 26); ROA.Sealed, Dkt.879 at 25 (emphasis added)) (RE Tabs 3, 9 & 10).

The issue before the district court on Hill IIIs motion to compel, and the

issue before the Court on this appeal, is not whether the former trustees should be

required to provide a trust accounting, since neither Hill III nor the successor

trustees are seeking a trust accounting. Rather, the issue before this Court is

whether the successor trustees should be permitted to copy the archives and

permanent records of the MHTE.

A trust accounting is defined under the Texas Property Code as a specific

written statement of accounts encompassing five distinct categories of


2953072 - 25 -

information, which must be generated and delivered by a trustee in response to a

beneficiarys demand. See Tex. Prop. Code 113.151, 113.152. Thus, a

beneficiarys right to a trust accounting is defined by law, and is entirely distinct

from a successor trustees right under the MHTEs Articles of Agreement to obtain

the existing archives and permanent records of the trust. In this regard, the

portion of the Settlement Agreement cited by the district court does not state or

imply that the successor trustee is somehow precluded from obtaining the existing

records of the trust, nor was such a result ever intended by the parties.10

In concluding that Hill IIIs motion to compel was foreclosed by the

Settlement Agreement, Judge Solis also incorrectly concluded that Judge

OConnors March 4, 2011 order denying Hill IIIs motion to alter or amend the

Final Judgment (ROA.Sealed, Dkt.1099 at 11 (RE Tab 8)) otherwise provided . . .

by order of the court that the successor trustees should not be permitted to access,

inspect, and copy the MHTE books and records. (ROA.18182-82) (RE Tab 3).

This conclusion wholly misconstrues the prior order.

10 At a May 12, 2010 conference concerning the Settlement Agreement, Frank Ikard, then-counsel for Appellee Lyda Hill, discussed the provision of the Settlement Agreement cited by the district court, explaining that [t]his is standard language to get a successor corporate trustee, you have to have an agreement because a successor trustee has to go back and investigate everything that a prior trustee did and so no one is going to serve as a successor trustee with all these allegations unless this language is in the instrument. (ROA.Sealed, Dkt.1267-1 at 223-24).


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As discussed above, soon after the Final Judgment was entered in November

2010, Hill III filed a motion to alter or amend the judgment in which he argued that

due to the passage of time between the Settlement Agreement and the Final

Judgment, the district court should order that Hill III, as a beneficiary of the

MHTE, had a right to a complete, updated accounting and right of inspection as to

the MHTE. (ROA.Sealed, Dkt.1050 at 14). The district court denied Hill IIIs

motion to alter or amend, finding that there was no basis to add a provision to the

Final Judgment entitling Hill III to an updated accounting in light of the language

in the Settlement Agreement providing that the former trustees were absolved from

liability for failure to furnish any trust accounting. (ROA.Sealed, Dkt.1099 at

11) (RE Tab 8).

Whether or not the district courts ruling on Hill IIIs motion to alter or

amend was correct, that ruling involved a totally separate issue than the one

presented here. Specifically, the motion to alter or amend raised the issue of

whether Hill III, in his capacity as a beneficiary, was entitled to an updated

accounting because of the passage of approximately six months between the

settlement and the entry of judgment. By contrast, the issue raised here is whether

the successor trustees are entitled to copies of the archives and permanent

records of the trust.


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In concluding that Judge OConnors prior order had addressed this issue,

Judge Solis incorrectly treated the successor trustees as if they are merely agents of

Hill III. They are not. To the contrary, a trustee is the owner of the legal title to

the trust corpus and the administrator of the trust, with a set of established rights

and obligations that are separate and distinct from the rights and obligations of the

beneficiary. (See ROA.17761-67) (RE Tab 5). Accordingly, the fact that the prior

district court judge found that Hill III was not entitled to a post-settlement

accounting in his role as a beneficiary is not relevant to the question of whether the

successor trustees are entitled to copies of the archives and permanent records of

the trust.

E. The Other Objections Raised by Appellees Lack Merit.

In their briefing before the district court, Appellees raised various additional

objections to Hill IIIs motion to compel the MHTEs records to be produced to the

successor trustees. None of those objections is meritorious. For example, the

former trustees objected that they should not be required to transfer the trusts

records to the successor trustees. However, Hill IIIs motion did not seek to

compel the transfer of the records rather, it sought merely to obtain copies of

the records for the successor trustees, and the successor trustees offered to pay for

those copies. (ROA.17743-44).


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The former trustees also argued that Hill III has already received voluminous

document productions during the course of the underlying litigation, and that those

records should be deemed sufficient. (ROA.Sealed, Dkt.1266 at 12-13). However,

the former trustees offered no evidence supporting the conclusion that the trust

records produced to Hill III during the litigation constitute the complete archives

and permanent records of the MHTE. The fact that some trust records were

previously produced to Hill III is irrelevant.

The former trustees likewise argued to the district court that production of

the MHTEs books and records would require substantial time and expense,

including a privilege review and withholding of particular documents based on a

discovery agreement with a third party. (ROA.Sealed, Dkt.1350 at 12 n.6). These

arguments are specious. As noted above, the successor trustees offered to pay for

making copies of the trust records, so the prior trustees faced no copying expenses

whatsoever. (ROA.Sealed, Dkt.1343 at 8-9 n.6; ROA.17790 (RE Tab 7)).

Moreover, there is no legitimate need for the prior trustees to conduct a privilege

review with respect to the archives and permanent records of the trust, since the

successor trustees are in legal privity with the former trustee. See In re Bradley,

501 F.3d 421, 433 (5th Cir. 2007) (citing Huie v. DeShazo, 922 S.W.2d 920, 926

(Tex. 1996) (an attorney represents the trustee in his capacity as trustee)); see

also Interfirst Bank-Houston, N.A. v. Quintana Petroleum Corp., 699 S.W.2d 864,


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879 (Tex. App. Houston [1st Dist.] 1985) (a successor trustee is in privity with

their predecessors as trustees, with respect to legal claims or rights that may be

asserted). Thus, even assuming for the sake of argument that the permanent

records of the trust contain privileged materials, the successor trustee not the

former trustee is now the holder of that privilege.

Simply put, Appellees have never articulated any objection to the production

of the MHTEs records to the successor trustees that is sufficient to outweigh the

successor trustees fundamental right to access those materials.

II. At a Minimum, Judge Soliss July 30, 2013 Order Should Be Vacated or Remanded to the District Court, Because He Was Apparently Operating under an Undisclosed Conflict.

This case was assigned to Judge Solis on May 23, 2013. Two months later,

on July 30, 2013, Judge Solis entered his one and only substantive ruling in this

action, which is the order at issue on this appeal. (ROA.18175-85) (RE Tab 3). In

addition to being erroneous for the reasons discussed above, Judge Soliss order is

also loaded with intemperate language and disparaging descriptions of both Hill III

personally (who is accused of, e.g., tilt[ing] at yet another windmill) and the

legal positions advanced by Hill III and his counsel (e.g., Nothing in the express

language of the MHTE Articles of Agreement directs a trustee to confer the

permanent records of the MHTE to successor trustees as though it were the family


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Bible, handed down from generation to generation.). (See ROA.18176-77,

18180-81) (RE Tab 3).

Hill III timely appealed Judge Soliss ruling, and then on September 26,

2013, less than two months after entering his solitary substantive ruling Judge

Solis voluntarily recused himself without explanation. (ROA.18192).

The United States Supreme Court has held that when a district court recuses

itself after entering one or more substantive orders, an appropriate remedy under

certain circumstances is to vacate any orders and judgments entered after the point

when the court should have recused itself. See Liljeberg v. Health Servs.

Acquisition Corp., 486 U.S. 847, 864 (1988) (listing factors to be considered,

including: (1) the risk of injustice to the parties in the particular case, (2) the risk

that the denial of relief will produce injustice in other cases, and (3) the risk of

undermining the publics confidence in the judicial process).

In this action, between the time that Judge Solis was appointed to hear the

matter on May 23, 2013, and the time that Judge Solis recused himself on

September 26, 2013, no new parties or causes of action were added. It is therefore

highly probable, if not certain, that whatever conflict caused Judge Solis to recuse

himself existed at the time he was appointed, and at the time he entered the order

that is being appealed from. There is a high risk of injustice to the parties and

specifically to Hill III as well as a risk of undermining the publics confidence in


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the judicial process, when a judge who was apparently operating under a conflict

renders an important order that disparages ones party and then promptly recuses

himself thereafter.

Rohrbach v. AT&T Nassau Metals Corp. is instructive. 915 F. Supp. 712

(M.D. Pa. 1996). In that case, the district judge recused himself after presiding

over a case for four years and after entering a number of substantive rulings. In

order to minimize the risk of injustice in that case, the new district court judge

fashioned an appropriate remedy independently reviewing every prior ruling for

bias to address the undisclosed conflict. Id. at 717.

Here, if Judge Soliss one and

2014 01 29 appellant's brief

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