Affirmed and Memorandum Opinion filed May 21, 2013.

In The

Fourteenth Court of Appeals

NO. 14-09-00866-CV

NO. 14-10-00324-CV

CHRIS THYGESEN AND BRUCE W. DERRICK, DERIVATIVELY ON 

BEHALF OF CLEARMEDIAONE, INC., AND ITS SHAREHOLDERS, 

Appellants

V.

ROBERT F. STRANGE, JR., ROBERT J. VIGUET, JR., AND THOMPSON 

& KNIGHT, LLP, Appellees

On Appeal from the 157th District Court

Harris County, Texas

Trial Court Cause No. 2008-35835

M E M O R A N D U M O P I N I O N

This case is a derivative shareholder suit brought by appellants, Chris 

Thygesen and Bruce W. Derrick, Derivatively on Behalf of ClearMediaOne, Inc. 

and its Shareholders, against appellees, Robert F. Strange, Jr., Robert J. Viguet, Jr.,
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and Thompson & Knight, LLP. In three issues, appellants contend the trial court 

erred by rendering a take-nothing judgment on the jury’s verdict instead of

adjudicating appellants’ request for equitable relief as a “Chancellor in Equity 

under Delaware law.” We affirm.

I. BACKGROUND1

Appellants owned shares in ClearMediaOne, Inc. (“ClearMediaOne”), one 

of several companies founded and directed by appellee Strange. Appellee Viguet, 

through his current law firm, appellee Thompson & Knight (collectively “the 

lawyer defendants”), and former law firms, has performed legal work over the 

years for Strange and his companies. According to appellants, Strange 

masterminded a fraud on the ClearMediaOne shareholders and the lawyer 

defendants facilitated the fraud via their alleged representation of Strange and his 

companies. Although appellants made numerous allegations regarding appellees’ 

actions, ultimately the jury was asked about appellees’ conduct relative to three 

transactions.

(1) Discontinuing ClearMediaOne and Starting SecurityComm. During 

its existence, ClearMediaOne experienced financial difficulties. Strange 

discontinued operation of ClearMediaOne and formed SecurityComm Group, Inc. 

(“SecurityComm”). Appellants claim SecurityComm was formed to evade 

liabilities to ClearMediaOne’s shareholders and use its assets for SecurityComm’s 

business without benefit to ClearMediaOne’s shareholders.

(2) Acquisition of Westex. SecurityComm acquired a company named 

“Westex.” Relative to that acquisition, Strange represented to Westex that 

 

1

In their appellate brief, appellants present almost thirty pages of factual background. 

Because all those facts are not material to our disposition, we present only a brief overview.
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SecurityComm had acquired another company named “APT.” Appellants allege 

this statement was false because the APT acquisition had not closed, which 

contributed to the unraveling of Westex. 

(3) Settlement of the Westex Litigation. Shortly after the Westex 

acquisition, conflicts arose and SecurityComm and Strange became involved in 

litigation with the stockholders, principals, and lenders of Westex. The parties 

reached a partial settlement whereby SecurityComm and Strange received funds in 

exchange for releasing their interest in Westex. According to appellants, the funds 

were improperly distributed to the lawyer defendants under the guise of a payment 

for legal fees and to Strange as payment under a consulting contract.

Appellants sued appellees for various causes of action and sought actual 

damages, exemplary damages, and equitable relief. The only issues submitted to 

the jury concerned alleged breaches of fiduciary duties by Strange and alleged 

conspiracy in such conduct by the lawyer defendants. The jury found that Strange 

breached his fiduciary duty to ClearMediaOne with respect to “Discontinuing 

ClearMediaOne and starting SecurityComm.” However, the jury declined to 

award any damages for this breach or find any harm to ClearMediaOne resulted 

from malice on the part of Strange. The jury found that Strange did not breach his 

fiduciary duty to ClearMediaOne with respect to “The acquisition of Westex” or 

“The settlement of the Westex Litigation.” The questions concerning the lawyer 

defendants, including whether they knowingly participated in a conspiracy to 

damage ClearMediaOne and whether any such conduct was committed with 

malice, were conditioned on a finding of damages against Strange. Therefore, the 

jury did not answer any questions concerning the lawyer defendants.

In their post-trial filing, appellants stated they had previously claimed a jury 

had no “adjudicative role” in the case although they agreed to the jury sitting in an 
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“advisory role,” to avoid “any issues” concerning the right to trial by jury. 

Appellees requested the trial court to grant equitable relief, sitting as “a Court of 

Chancery in Delaware.” On September 25, 2009, the trial court signed a final 

judgment ordering appellants take nothing from appellees.

II. ANALYSIS

In three issues, appellants contend the trial court erred by (1) failing to apply 

Delaware law and adjudicate the case as a “Chancellor in Equity under Delaware 

law,” (2) rendering judgment on the jury’s verdict because it was advisory only, 

and (3) violating the “fundamental maxim” that “equity will not suffer a wrong 

without a remedy” via the actions described in issues one and two. Appellants do 

not challenge sufficiency of the evidence to support any of the jury’s findings. 

Appellants complain only that the trial court rendered a take nothing judgment on

the jury verdict rather than adjudicating their request for equitable relief. 

Appellants seek equitable relief in the form of rescissory damages and fee 

forfeiture.

Appellants contend that, under the law of Delaware, as the state of 

ClearMediaOne’s incorporation, the Delaware Court of Chancery has exclusive 

jurisdiction over all aspects of a claim for breach of fiduciary duty by a corporate 

fiduciary even when monetary relief is the only remedy. Thus, appellants suggest 

the jury verdict was advisory only and the trial court, sitting as a Delaware 

Chancellor in Equity, was required to decide the equitable issues of whether 

appellees’ actions deceived the ClearMediaOne shareholders and fashion a

remedy. Therefore, appellants maintain this case has never been properly 

adjudicated and they have thereby been deprived of an equitable remedy.

We disagree the jury’s verdict was advisory only. Appellees properly 

demanded their right to a trial by jury. In a pre-trial Rule 11 agreement, appellants 
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agreed to a trial by jury. When the trial court entertained objections to the jury 

charge, appellants did not object to any of the questions. Moreover, when a suit is 

brought in a Texas state court, procedural matters are governed by Texas law even 

if the law of another state or federal law governs substantive issues. See Mitchell 

v. Missouri–Kansas–Texas R.R. Co., 786 S.W.2d 659, 661 (Tex. 1990) (op. on 

rehearing), overruled on other grounds by Union Pac. R. Co. v. Williams, 85 

S.W.3d 162, 169 (Tex. 2002); Penny v. Powell, 347 S.W.2d 601, 602 (Tex. 1961); 

Illinois Tool Works, Inc. v. Harris, 194 S.W.3d 529, 532 (Tex. App.—Houston 

[14th Dist.] 2006, no pet.); In re Wells Fargo Bank Minn. N.A., 115 S.W.3d 600,

605 n.7 (Tex. App.—Houston [14th Dist.] 2003, orig. proceeding [mand. denied]). 

Whether a party is entitled to a jury trial on a particular claim is typically a

procedural issue governed by the law of the forum. Wells Fargo Bank Minn., 115 

S.W.3d at 605 n.7 (citing Restatement (Second) of Conflict of Laws § 129 (2012)); 

see Restatement (Second) of Conflict of Laws § 129 cmt. a. (“The local law of the 

forum determines whether a party is entitled to a jury trial on any aspect of his 

case.”); see also Mitchell, 786 S.W.2d at 661–62 (“This court has recognized that 

rules relating to the form, necessity, and effect of jury issues are procedural rather 

than substantive if they do not interfere with a right or defense provided by the 

F.E.L.A.”) (emphasis in original; internal quotations omitted).

Relative to the apportionment of duties between the jury and the trial court 

when a party requests equitable relief, the Supreme Court of Texas has held: “As a 

general rule, a jury does not determine the expediency, necessity, or propriety of 

equitable relief. . . . However, when contested fact issues must be resolved before 

equitable relief can be determined, a party is entitled to have that resolution made 

by a jury.” Burrow v. Arce, 997 S.W.2d 229, 245 (Tex. 1999) (internal quotations 
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omitted). More specifically, with respect to the equitable remedy at issue in 

Burrow, attorney-fee forfeiture, the court continued:

Thus, when forfeiture of an attorney’s fee is claimed, a trial 

court must determine from the parties whether factual disputes exist 

that must be decided by a jury before the court can determine whether 

a clear and serious violation of duty has occurred, whether forfeiture 

is appropriate, and if so, whether all or only part of the attorney’s fee 

should be forfeited. Such factual disputes may include, without 

limitation, whether or when the misconduct complained of occurred, 

the attorney’s mental state at the time, and the existence or extent of 

any harm to the client. If the relevant facts are undisputed, these 

issues may, of course, be determined by the court as a matter of law. 

Once any necessary factual disputes have been resolved, the court 

must determine, based on the factors we have set out, whether the 

attorney’s conduct was a clear and serious breach of duty to his client 

and whether any of the attorney’s compensation should be forfeited, 

and if so, what amount.

Id. at 246. Accordingly, under Texas procedural law applicable in this case, the

jury had the exclusive role of resolving factual issues underlying a request for 

equitable relief, including whether appellees breached fiduciary duties or 

committed any other misconduct; the court then had the role of deciding whether to 

order equitable relief based on any jury finding of misconduct. See id. at 245–46.

Appellants’ brief is devoted to the contention that this case has not been 

adjudicated because the trial court failed to consider an equitable remedy. We 

disagree. The trial lasted approximately a week. The jury heard testimony from 

eight witnesses, as well as arguments of counsel, before rendering its verdict. 

Appellants then presented their request for equitable relief to the trial court before 

it signed the judgment. In the judgment, the court ordered that appellants take 

nothing based on the jury verdict and then recited, “All other relief not expressly 

granted in this judgment is denied.” Therefore, the trial court did rule on the 

request for equitable relief—it denied the request. 
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Appellants did not obtain a jury finding that (1) the lawyer defendants 

breached fiduciary duties or committed any other misconduct, or (2) Strange 

breached fiduciary duties or committed any other misconduct relative to the 

acquisition of Westex and settlement of the Westex litigation. The jury expressly 

found Strange did not breach his fiduciary duties with respect to those transactions. 

The requirement that the jury answer questions concerning the lawyer defendants 

was conditioned on a finding of damages against Strange. Appellants did not 

object to this conditional submission. Because the jury found no damages against 

Strange, it did not answer the questions concerning the lawyer defendants. Thus, 

appellants failed to obtain the factual findings prerequisite to equitable relief on (1) 

any claims against the lawyer defendants, and (2) the claims against Strange 

relative to acquisition of Westex and settlement of the Westex litigation.

The jury did find Strange breached a fiduciary duty with respect to 

discontinuation of ClearMediaOne and formation of SecurityComm, although the 

jury did not assess any damages and found no malice on the part of Strange. We 

recognize a jury’s refusal to award actual damages for breach of fiduciary duty 

does not preclude a trial court from ordering equitable relief, such as disgorgement 

of profits or fee forfeiture, although the fiduciary’s mental state and existence of

actual damages are factors for the trial court’s consideration. See id. at 239–240, 

246. However, equitable relief is not mandatory because the “the expediency, 

necessity, or propriety of equitable relief” is committed to the trial court’s 

discretion. See Wagner & Brown, Ltd. v. Sheppard, 282 S.W.3d 419, 428–29 

(Tex. 2008); see also Burrow, 997 S.W.2d at 240–42, 246. Accordingly, a trial 

court’s decision on whether to order equitable relief is reviewed for abuse of 

discretion. Wagner & Brown, 282 S.W.3d at 428–29; see Illinois Tool Works, 194
8

S.W.3d at 532 (stating the applicable standard of review is a procedural matter

governed by law of the forum).

However, appellants have not demonstrated the trial court abused its

discretion. Specifically, appellants do not present an appellate issue, contending

the trial court abused its discretion by denying their request for equitable relief at 

least on the one transaction for which the jury found Strange breached fiduciary

duties. Instead, appellants’ complaint is that the trial court failed to adjudicate 

their request for equitable relief at all and decide the underlying factual and legal 

issues relative to all the transactions as a Delaware Chancellor in Equity. For 

instance, in their brief, appellants suggest the trial court was required to treat all

the jury findings as advisory only, decide for itself that appellees committed 

misconduct relative to all three transactions, and then order equitable relief:

The jury answered this question (whether SecurityComm was a 

“sham to perpetuate a fraud”) affirmatively in broad form by finding 

that [Strange] failed to comply with his fiduciary duty to 

[ClearMediaOne] in discontinuing [ClearMediaOne] and starting up 

[SecurityComm]. In pointing this out, Appellants lay no claim to this 

verdict, which Appellants continue to believe was flawed and should 

not be parsed out by one seeking equity. What is lacking here is a 

proper adjudication of the case.

(emphasis added).

At some points, appellants request a remand for the trial court to adjudicate

their request for equitable relief. At another point, appellants suggest that, because 

of the trial court’s alleged failure to adjudicate their request, we act as the court in 

equity and order the following relief: rescissory damages in an amount over $2.3 

million, allocated pro rata among “innocent shareholders;” and forfeiture of the 

$244,000.00 obtained by appellees in settlement of the Westex litigation.
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As discussed above, the trial court has ruled on the request for equitable 

relief in accordance with applicable Texas law governing the apportionment of 

duties among the jury and the trial court. On most of appellants’ claims, the trial 

court was precluded from ordering such relief based on the lack of a prerequisite 

jury finding. We reject appellants’ suggestion that the trial court was required, or 

even authorized, to consider the verdict as advisory only and re-decide factual 

issues underlying the request for equitable relief. On the other claim, appellants 

fail to demonstrate the trial court abused its discretion by denying the request for 

equitable relief. Accordingly, we decline to remand for any further determination 

or order recovery of the sums urged by appellants.

We overrule appellants’ three issues and affirm the trial court’s judgment.

 

/s/ John Donovan

Justice

Panel consists of Justices Boyce, McCally, and Donovan.