NOTE: This disposition is nonprecedential.

United States Court of Appeals 

for the Federal Circuit ______________________ 

SECURUS TECHNOLOGIES INC.,

Plaintiff-Cross-Appellant

v.

GLOBAL TEL*LINK CORPORATION,

Defendant-Appellant

______________________ 

2016-1470, 2016-1506

______________________ 

Appeals from the United States District Court for the 

Northern District of Texas in No. 3:13-cv-03009-K, Judge 

Ed Kinkeade.

______________________ 

Decided: January 26, 2017 

______________________ 

MARK STRACHAN, Sayles Werbner, P.C., Dallas, TX, 

argued for plaintiff-cross-appellant. Also represented by 

E. SAWYER NEELY, DARREN PATRICK NICHOLSON, RICHARD 

ALAN SAYLES; GRADY MICHAEL GRUBER, ANTHONY MAGEE, 

Gruber Hurst Elrod Johansen Hail Shank LLP, Dallas, 

TX; BRUCE SOSTEK, RICHARD L. WYNNE, JR., Thompson & 

Knight LLP, Dallas, TX.

JOHN CHRISTOPHER ROZENDAAL, Sterne Kessler Goldstein & Fox, PLLC, Washington, DC, argued for defend-
2 SECURUS TECHNOLOGIES INC v. GLOBAL TEL*LINK CORP. 

ant-appellant. Also represented by WILLIAM H. MILLIKEN, 

Kellogg, Huber, Hansen, Todd, Evans & Figel, PLLC, 

Washington, DC. 

______________________ 

Before DYK, BRYSON, and REYNA, Circuit Judges.

BRYSON, Circuit Judge. 

I 

Securus Technologies, Inc., owns patents relating to 

the delivery of communications services to correctional 

facilities. It has sued various entities for infringement of 

those patents. One of the entities Securus sued was 

Public Communications Services, Inc. (“PCS”). That suit 

ended in 2009 with a settlement that included Securus’s 

agreement not to sue “PCS or its affiliates” for “infringement of any Securus Patent” until September 18, 2014.

In 2010, Global Tel*Link Corporation (“GTL”) acquired PCS through a stock purchase, and PCS became a 

wholly owned subsidiary of GTL. Three years later, 

Securus brought an infringement action against GTL. 

GTL invoked Securus’s covenant not to sue PCS or its 

affiliates as an affirmative defense, asserting that it was 

an “affiliate” of PCS. GTL also filed a counterclaim 

charging Securus with breach of contract, alleging that 

Securus had violated the covenant by suing GTL for 

patent infringement. For relief on the counterclaim, GTL 

sought damages in the amount of the attorney fees it 

incurred in defending against the infringement claim.1 

 

1 GTL also sought a fee award for the attorney fees 

it incurred in prosecuting its breach of contract counterclaim. GTL sought those fees under chapter 38 of the 

Texas Civil Practice and Remedies Code. That fee request

is not yet ripe for decision and is not part of this appeal.
SECURUS TECHNOLOGIES INC v. GLOBAL TEL*LINK CORP. 3

Based on the covenant not to sue, GTL moved for 

summary judgment on Securus’s infringement claim. The 

district court granted GTL’s motion. The court agreed 

that GTL qualified as an affiliate of PCS and that the 

covenant therefore protected GTL from Securus’s suit. 

Under Texas law, the court explained, “entities who are a 

subsidiary, parent, or sibling corporation . . . are all 

encompassed within the plain, ordinary, and generally 

accepted meaning of ‘affiliate.’” Because GTL satisfied 

that definition, the court held that the covenant not to sue 

barred the infringement action against GTL.

For its part, Securus moved for summary judgment on 

GTL’s counterclaim for breach of the covenant not to sue. 

Securus argued that it was entitled to summary judgment 

on GTL’s breach of contract claim because GTL had not 

offered competent evidence of damages. In particular, 

Securus argued that GTL had not introduced any evidence that the attorney fees GTL incurred in the infringement action were reasonable and necessary. 

Securus also argued that under Texas law GTL was 

required to present expert testimony in support of its 

claim for attorney fees as damages for the breach of the 

covenant not to sue. Because GTL had not designated an 

expert to testify on the reasonableness and necessity of its 

fees, Securus argued that it was entitled to summary 

judgment on GTL’s request for attorney fees as damages

on its counterclaim. 

The district court granted Securus’s motion for summary judgment, holding that under Texas law GTL’s 

claim for attorney fees as damages required expert testimony, or at least an attorney for GTL testifying as an 

expert. Because GTL had not timely designated an 

expert, the court held that GTL would not be able to 

satisfy that requirement and thus would not be able to 

prove attorney fee damages for breach of the covenant not 

to sue. 
4 SECURUS TECHNOLOGIES INC v. GLOBAL TEL*LINK CORP. 

Securus has appealed from the district court’s order 

holding that the covenant not to sue barred Securus from 

suing GTL for patent infringement. GTL has appealed 

from the district court’s order holding that GTL did not 

properly support its claim for damages. We affirm both 

orders.

II 

On Securus’s appeal, we agree with the district court 

that the covenant not to sue that Securus entered into as 

part of the 2009 settlement agreement was applicable to

GTL and that the covenant barred Securus from bringing 

a patent infringement action against GTL before 2014. 

Securus acknowledges that GTL can claim the benefit 

of the 2009 covenant not to sue if GTL qualifies as an 

“affiliate” of PCS. Securus argues, however, that the 

district court erred in holding that GTL is an “affiliate” of 

PCS within the meaning of the covenant not to sue. 

In the covenant, Securus agreed not to sue “on behalf 

of itself and its former and present affiliates, subsidiaries 

and parent corporations, successors and assigns.” Securus points out that, by contrast with that sweeping 

language referring to the parties who were barred from 

bringing suit, the portion of the 2009 covenant referring 

to the parties that Securus agreed not to sue names only

“PCS or its affiliates.” Because the agreement refers to 

Securus’s “affiliates, subsidiaries and parent corporations” as separate entities, Securus argues that the 

agreement’s reference only to PCS’s “affiliates” is a clear 

indication that the term “affiliate,” as used in the covenant, does not include a parent corporation of PCS, such 

as GTL.

That textual argument is unpersuasive. It is not unusual for legal documents to use overlapping language in 

order to ensure against gaps in intended coverage. Overlapping terms are frequently found in documents such as 
SECURUS TECHNOLOGIES INC v. GLOBAL TEL*LINK CORP. 5

wills (“give, bequeath, and devise”), contracts of sale 

(“grant, bargain, sell, and convey”), and releases (“remise, 

release, and forever discharge”). That appears to be the 

role of the reference in the 2009 contract to Securus’s 

covenant not to sue “on behalf of itself and its former and 

present affiliates, subsidiaries and parent corporations, 

successors and assigns.” 

The problem with Securus’s argument is that if those 

terms were given non-overlapping meanings, the term 

“affiliate” would not include subsidiaries, since the term 

“subsidiaries” is separately set forth in the clause on 

which Securus relies. Yet Securus acknowledges that a 

“subsidiary” is a paradigmatic example of an “affiliate” 

under its narrow interpretation of that term. It is clear, 

therefore, that even under Securus’s view of the meaning

of “affiliate,” the terms in the clause on which Securus 

relies must be regarded as overlapping. 

Securus further contends that the plain, ordinary, and 

generally accepted meaning of “affiliate” does not include 

a corporate parent. According to Securus, the plain 

meaning of the term “affiliate,” both in general and under 

Texas law, refers to a company “that is either subordinate 

to another or dependent on another through ownership or 

control,” and that it does not include a parent corporation. 

That argument does not stand up against a review of 

the authorities pertinent to the 2009 covenant. First, the 

term “affiliate” was defined in the contemporaneous 

edition of Black’s Law Dictionary to mean “a subsidiary, 

parent or sibling corporation,” or a corporation “related to 

another corporation by shareholdings or other means of 

control,” a definition that clearly includes parent corporations. Black’s Law Dictionary 67 (9th ed. 2009). When

applying Texas law to interpret a contract, courts have 

looked to the definition in Black’s Law Dictionary as 

setting forth the ordinary meaning of the term “affiliate.” 

Thus, the court in McLane Foodservice, Inc. v. Table Rock 
6 SECURUS TECHNOLOGIES INC v. GLOBAL TEL*LINK CORP. 

Rests., L.L.C., 736 F.3d 375, 378 (5th Cir. 2013), held that 

the ordinary definition of “affiliate” under Texas law 

includes a parent corporation; see also id. at 378 n.3

(“Texas courts have cited Black’s Law Dictionary when 

interpreting undefined terms in a contract.”).

Texas authorities confirm that Texas law embraces

that broad definition of “affiliate.” The Texas Business 

Organizations Code, which GTL accurately describes as 

“the state’s central repository of corporate law,” defines 

“affiliate” as “a person who controls, is controlled by, or is 

under common control with another person.” See Funderburk Enters., LLC v. Cavern Disposal, Inc., No. A-09-CA327, 2009 WL 3101064, at *5 (W.D. Tex. Sept. 22, 2009)

(citing the Texas Business Organizations Code and 

Black’s Law Dictionary as providing the ordinary meaning of “affiliate”). That definition clearly includes parent 

corporations such as GTL, which is under common control 

with its wholly owned subsidiary, PCS. 

Texas state judges have applied that definition as 

well. See Eckland Consultants, Inc. v. Ryder, Stilwell 

Inc., 176 S.W.3d 80, 88 (Tex. App. 2004) (citing Webster’s 

Third New International Dictionary 35 (1971) and defining “affiliate” to mean “a corporation that is related to 

another corporation by shareholdings or other means of 

control,” and “a company effectively controlled by another 

or associated with others under common ownership or 

control”); see also Texas Rice Land Partners, Ltd. v. Denbury Green Pipeline-Texas, LLC, 381 S.W.3d 465, 467 

(Tex. 2012) (Wainwright, J., concurring) (stating that an 

affiliate is “commonly understood” to include a parent 

corporation).

Federal courts interpreting Texas law have consistently reached the same conclusion: that under the general 

definition of “affiliate” in Texas law, parent corporations 

are “affiliates” of their subsidiaries. See McLane Foodservice, 736 F.3d at 378; Texas Molecular Ltd. P’ship v. Am. 
SECURUS TECHNOLOGIES INC v. GLOBAL TEL*LINK CORP. 7

Int’l Specialty Lines Ins. Co., 424 F. App’x 354, 357 (5th 

Cir. 2011) (holding that all of the entities in question were 

affiliates under the applicable common-ownership definition, including corporate entities that “owned shares of 

and controlled the other entities”); In re Heartland Payment Sys., Inc. v. Customer Data Sec. Breach Litig., C.A. 

No. H-10-271, 2011 WL 1232352, at *19 (S.D. Tex. Mar. 

31, 2011) (“The ordinary meaning of the term ‘affiliate’ in 

this context is ‘a corporation that is related to another 

corporation by shareholdings or other means of control’ or 

‘a subsidiary, parent or sibling corporation.’”); Funderburk 

Enters., 2009 WL 3101064, at *5 (the “important factor” 

in determining if entities are affiliates “seems to be the 

existence of common ownership or control of the two 

entities”); Magicon v. Weatherford Int’l, Inc., C.A. Nos. 

4:08-cv-3639, 2009 WL 7868862, at *14 (S.D. Tex. Aug. 

14, 2009) (“the ordinary meaning of ‘affiliate’ encompasses 

both an understanding of an affiliate as a subsidiary and 

as a related corporation regardless of how related”); 

Adams v. Dell Computer Corp., No. Civ A C-06-089, 2006 

WL 2670969, at *5-6 (S.D. Tex. Sept. 18, 2006) (applying 

same definition as “ordinary meaning” of “affiliate” where 

contract does not define the term).2

 

2 Securus argues (Br. 28) that although the Fifth 

Circuit in McLane Foodservice cited the definition of 

“affiliate” in Black’s Law Dictionary, the court “did not 

adopt that definition as the ‘plain, ordinary, and generally 

accepted meaning’ of ‘affiliate’ or apply that definition in 

its decision.” In fact, it is plain from the cited passage of 

McLane Foodservice that the court did exactly that: It 

determined that the “plain and ordinary meaning” of the 

term “affiliate” is found in Black’s Law Dictionary, the 

place that a Texas state court would look for the definition of that term in the absence of a definition in the 

contract. 736 F.3d at 378 & n.3. As for the decision in 
8 SECURUS TECHNOLOGIES INC v. GLOBAL TEL*LINK CORP. 

The district court therefore correctly concluded that 

under both the general definition of the term “affiliate” 

and the applicable principles of Texas law, GTL, as the 

parent corporation of PCS, qualified as an “affiliate” of 

PCS for purposes of the 2009 covenant not to sue. The 

court therefore correctly held that Securus was contractually barred from bringing suit against GTL at the time it 

did.

III 

On GTL’s appeal, we uphold the district court’s ruling 

that GTL failed to establish an element essential to an 

award of attorney fees as damages for Securus’s breach of 

the covenant not to sue.

A 

The district court held that GTL was entitled to damages for breach of the covenant not to sue, and that the 

damages would be based on the attorney fees incurred in 

defending the suit that was barred by the covenant. The 

court further held, however, that in order to establish its 

right to an award of attorney fees as damages, GTL was 

required to offer expert testimony, or at least testimony 

from an attorney designated as an expert, to prove that 

the fees incurred by GTL in defending against the patent 

infringement claim were reasonable and necessary.

 

Texas Molecular, Securus argues (Br. 26) that the Fifth 

Circuit’s definition of “affiliate” as a company “effectively 

controlled or associated with others under common ownership or control” excludes parents. It does not. Both 

parents and subsidiaries are “associated” with one another “under common ownership or control.” 424 F. App’x at 

357. Securus’s effort to distinguish Magicon (Br. 33-34), 

in which the court applied the same definition, fails on 

the same ground.
SECURUS TECHNOLOGIES INC v. GLOBAL TEL*LINK CORP. 9

GTL argued to the district court that it was not necessary to use an expert to prove its entitlement to an award 

of attorney fees as damages. Rather, GTL argued, all that 

was required to prove attorney fees as damages in a case 

involving the breach of a covenant not to sue was to show 

that the attorney fees were the natural and foreseeable 

consequences of the breach. GTL argued that it did not 

need to prove that the fees were reasonable and necessary; it only needed to introduce the records of the fees 

incurred. 

The district court disagreed. Under Texas law, the 

court held that when attorney fees are sought as actual 

damages in an action such as one for breach of a covenant 

not to sue, the claimant must show that the fees were

reasonable and necessary. The court further held that 

expert testimony is needed to show that the fees are 

reasonable and necessary, because such knowledge is 

“outside the normal understanding of a lay person.” 

Because GTL failed to designate an expert (or an attorney 

testifying as an expert) by the deadline for designating 

experts and making expert disclosures, the court granted 

summary judgment on that issue to Securus.

B 

In this court, GTL is no longer pressing the argument 

that it is not required to prove that its attorney fees were 

reasonable and necessary. Nor is it arguing, as it did in 

the district court, that it could establish its right to an 

award of attorney fees simply by presenting the fee documents and calling a GTL representative to testify that 

GTL paid the fees. Instead, GTL appears to accept that 

under Texas law it was required to offer testimony from 

an attorney regarding the reasonableness and necessity of 

the fees it incurred in defending against Securus’s in-
10 SECURUS TECHNOLOGIES INC v. GLOBAL TEL*LINK CORP. 

fringement claims.3 GTL’s claim on appeal is that Texas 

law does not require that the attorney who testifies as to 

the reasonableness and necessity of the fees sought as 

damages be designated as an expert. For that reason, 

GTL argues that it was not required to make the appropriate expert witness disclosures by the deadline for 

designating expert witnesses. GTL’s appeal thus turns on 

whether Texas law requires expert testimony—either 

from an attorney or otherwise—on the issue of the reasonableness and necessity of the fees incurred by the 

party seeking a fee award as damages.4

Texas law on the issue before the district court is

clear: When a party seeks an award of attorney fees as 

damages, it is required to introduce expert testimony, 

from an attorney or otherwise, to establish that the fees 

 

3 In a footnote (Br. 19 n.35), GTL hedges its position on this point, stating that even though the Fifth 

Circuit has “assumed” that fees sought to be recovered as 

actual damages must be reasonable and necessary, “it is 

not in fact clear that the Texas Supreme Court would find 

that a party seeking attorneys’ fees as actual damages is 

required to establish that the fees were ‘reasonable and 

necessary’ as opposed to merely foreseeable.” GTL, however, cites no authority from the Texas Supreme Court 

supporting that contention, and the Texas and Fifth 

Circuit cases cited infra are clearly to the contrary. 4 At oral argument, GTL’s counsel suggested that 

even if Texas law required the testimony of an attorney 

designated as an expert to prove attorney fees as damages, that requirement would not necessarily apply in a 

federal court proceeding, even though the claim for fees is

a state law claim brought under the federal court’s supplemental jurisdiction. GTL, however, did not make or 

develop that argument in its briefs in this court, so we do 

not address it here. 
SECURUS TECHNOLOGIES INC v. GLOBAL TEL*LINK CORP. 11

were reasonable and necessary. The Texas cases are 

unambiguous on the point.

First, contrary to GTL’s argument below, the Texas 

courts that have recognized a right to seek attorney fees 

as damages in appropriate cases have required proof that 

the fees were reasonable and necessary. See Turner v. 

Turner, 385 S.W.2d 230, 234 (Tex. 1964); Dixon Fin. 

Servs., Ltd. v. Chang, 325 S.W.3d 668, 678 (Tex. App. 

2010); Lesikar v. Rappeport, 33 S.W.3d 282, 307 (Tex. 

App. 2000); Powell v. Narried, 463 S.W.2d 43, 46 (Tex. 

App. 1971); see also Am. Home Assurance Co. v. United 

Space Alliance, LLC, 378 F.3d 482, 490 (5th Cir. 2004).

Second, Texas courts have ordinarily required expert 

testimony to prove attorney fees, and when an attorney 

testifies that the attorney fees are reasonable and necessary, the Texas courts have held that the attorney testifies as an expert. See E.F. Hutton & Co. v. Youngblood, 

741 S.W.2d 363, 364 (Tex. 1987); Gulf Paving Co. v. 

Lofstedt, 188 S.W.2d 155, 160-61 (Tex. 1945) (“estimates 

of . . . value made by attorneys who testified” is “opinion 

evidence of expert witnesses”); Woodhaven Partners, Ltd. 

v. Shamoun & Norman, L.L.P., 422 S.W.3d 821, 830 (Tex. 

App. 2014) (“Texas law is clear that ‘[t]he issue of reasonableness and necessity of attorney’s fees requires expert 

testimony.’”); Phillips v. Phillips, 296 S.W.3d 656, 671 

(Tex. App. 2009) (“Expert testimony as to the reasonableness of the attorney’s fees is required to support an award 

of attorney’s fees.”); Twin City Fire Ins. Co. v. VegaGarcia, 223 S.W.3d 762, 770 (Tex. App. 2007) (“The issue 

of reasonableness and necessity of attorney’s fees requires 

expert testimony.”); Lesikar, 33 S.W.3d at 308 (“Generally, the issue of reasonableness and necessity of attorneys’ 

fees requires expert testimony; an attorney testifies as to 

reasonableness, and the testifying attorney must be 

designated as an expert before he testifies.”); Cantu v. 

Moore, 90 S.W.3d 821, 826 (Tex. App. 2002) (“Expert 

testimony is required to support an award of attorneys’ 
12 SECURUS TECHNOLOGIES INC v. GLOBAL TEL*LINK CORP. 

fees.”); Woolett v. Matyastik, 23 S.W.3d 48, 52 (Tex. App. 

2000) (same); Nguyen Ngoc Giao v. Smith & Lamm, P.C., 

714 S.W.2d 144, 148 (Tex. App. 1986) (An affidavit from 

an attorney representing a party “is admissible in a 

summary judgment proceeding and is considered expert 

testimony.”).

Third, the Texas cases that have addressed the issue 

have consistently held that a party who uses an expert—

or an attorney testifying as an expert—to establish the 

reasonableness and necessity of attorney fees must identify the expert at the time required for designating experts 

generally. See E.F. Hutton & Co., 741 S.W.2d at 364; 

Woodhaven Partners, 422 S.W.3d at 830 (“An attorney 

testifies as to reasonableness; the testifying attorney 

must be designated as an expert before he or she testifies.”); Lesikar, 33 S.W.3d at 308 (same); see also 15625 

Fort Bend Ltd. v. Sentry Select Ins. Co., 991 F. Supp. 2d 

932, 946 (S.D. Tex. 2014) (“the failure to properly and 

timely designate an expert witness on a fee award bars 

recovery of such fees under Texas law”).

The last two points are dispositive of GTL’s position 

before this court: GTL was required to designate an 

expert to testify in support of its claim for attorney fees as 

damages, and when it failed to timely designate an expert, it forfeited its right to an award of fees.

C 

GTL does not seriously engage the Texas cases that 

stand for those three points. Instead, GTL principally 

relies on two federal cases that apply Texas law—a case 

from this court, Taurus IP, LLC v. DaimlerChrysler Corp., 

726 F.3d 1306 (Fed. Cir. 2013), and a case from the Fifth 

Circuit, American Home Assurance Co. v. United Space 

Alliance, LLC, 378 F.3d 482 (5th Cir. 2004). GTL argues 

that those cases support its view of Texas law, and that 

they are binding authority on this court regardless of 

what the Texas state court decisions might say.
SECURUS TECHNOLOGIES INC v. GLOBAL TEL*LINK CORP. 13

When exercising either diversity or supplemental jurisdiction, both the Fifth Circuit and this court must defer 

to authoritative state court decisions interpreting state 

law. Felder v. Casey, 487 U.S. 131, 151 (1988). For the 

reasons set forth below, we are persuaded that the Federal Circuit’s decision in Taurus and the Fifth Circuit’s 

decision in American Home do not conflict with the Texas 

state courts’ interpretation of the relevant provisions of 

Texas law. We are therefore free to apply Texas law as 

announced by the Texas state courts.5

Taurus presented two discrete issues involving attorney fees and damages. First, the district court awarded 

attorney fees incurred in prosecuting a breach of warranty suit. That fee award was predicated on section 38.001 

of the Texas Civil Practice and Remedies Code. Second, 

the court awarded damages in the amount of the attorney 

fees that the defendants had incurred in defending 

against a patent infringement action. 

One of the issues in Taurus was whether expert testimony was necessary to support either of the two awards. 

As to the first award, the court concluded that expert 

testimony was not necessary to support the award under 

section 38.001 for the breach of contract action. As to the 

second award, the court found it unnecessary to decide 

 

5 Because we reject GTL’s interpretation of Taurus

and American Home, we do not have to address the question whether those cases correctly construe Texas law, as 

expressed in the state court decisions cited above, including several intermediate state appellate court decisions 

that post-date Taurus and American Home. See Broussard v. S. Pac. Transp. Co., 665 F.2d 1387, 1389 (5th Cir. 

1982) (one panel of a federal appellate court should follow 

a prior panel’s interpretation of state law “absent a subsequent state court decision or statutory amendment 

which makes this Court’s (prior) decision clearly wrong”).
14 SECURUS TECHNOLOGIES INC v. GLOBAL TEL*LINK CORP. 

whether expert testimony was required to support the 

award of attorney fees as damages for the defense of the 

patent infringement action. 726 F.3d at 1342. Thus,

while Taurus ruled on the need for expert testimony in a 

proceeding brought under Tex. Civ. Prac. & Rem. Code 

§ 38.001, it did not address the issue before this court at 

all.6 

American Home has some parallels with this case, but 

like Taurus it does not address the key questions at issue 

here. In particular, American Home does not address or 

decide whether, under Texas law, an expert or an attorney designated as an expert is needed to testify as to the 

necessity and reasonableness of attorney fees when those 

fees are sought as damages in a breach of contract action. 

In American Home, a liability insurer, American 

Home Assurance Company (“AHAC”), declined coverage of 

its insured, United Space Alliance, LLC, (“United Space”)

and refused to defend United Space in a liability action 

brought by a third party. United Space sued AHAC for 

breach of the duty to defend under its liability policy. The

jury held that AHAC had breached its duty to defend and 

awarded United Space (1) attorney fees as damages to 

compensate United Space for the cost of defending the 

third-party lawsuit and (2) an award of attorney fees 

 

6 Securus argues that Taurus is pertinent because, 

by treating fee awards under section 38.001 separately 

from damages awards for the cost of unjustified proceedings, the court departed from the rationale of the district 

court in this case, which ruled that expert testimony was 

required in both instances. Regardless of whether the 

district court was correct in its analysis of cases applying 

section 38.001, however, its holding as to Texas law 

regarding the proof of attorney fees as damages is consistent with the Texas authorities cited above and is not 

at odds with anything decided by this court in Taurus. 
SECURUS TECHNOLOGIES INC v. GLOBAL TEL*LINK CORP. 15

incurred in the coverage action that United Space brought 

to enforce AHAC’s duty to defend. AHAC appealed, 

arguing that United Space’s evidence did not support 

either verdict under Texas law.

As GTL did below in this case, United Space took the 

position that under Texas law it was not required to prove 

that the fees it incurred in the third-party action were 

reasonable and necessary; all that was required, according to United Space, was to show that the fees were the 

natural and foreseeable consequences of AHAC’s actions. 

In light of AHAC’s position, the district court granted 

United Space’s motion in limine to prevent AHAC from 

raising the issue of the reasonableness of United Space’s 

attorney fees. Accordingly, United Space did not offer

expert testimony on the reasonableness and necessity of 

the fees and did not designate its attorney as an expert

for that purpose. 378 F.3d at 490.

On appeal, the Fifth Circuit reversed. In the portion 

of the court’s opinion that addressed the coverage action, 

the court analyzed the fee request under section 38.001. 

On that issue, the court remanded for further proceedings. The court noted that another provision of the same 

statute, Tex. Civ. Prac. & Rem. Code § 38.003, creates a 

rebuttable presumption that fees requested under section 

38.001 are reasonable as long as those fees are shown to 

be “usual and customary.” 378 F.3d at 492. The court 

held that because of the presumption of reasonableness in 

section 38.003, expert testimony was not required to 

support a claim for attorney’s fees under section 38.001, 

since “[t]he requirement of a designated expert goes to the 

reasonableness of the fees requested.” 378 F.3d at 493. 

Nonetheless, the court reversed because United Space’s 

evidence did not even show that the fees were “usual and 

customary,” the threshold necessary to trigger the presumption of reasonableness.
16 SECURUS TECHNOLOGIES INC v. GLOBAL TEL*LINK CORP. 

As in Taurus, the court in American Home dealt separately with the claim for attorney fees as damages. It

held that under Texas law, “attorney’s fees sought to be 

recovered as damages must be reasonable and necessary.” 

378 F.3d at 490. Because the jury had not been required 

to make such a finding, the court remanded for further 

proceedings on the damages issue.7 

In a passage that GTL relies on, the court said the following: 

To show the reasonableness and necessity of attorney’s fees incurred, Texas courts have generally held that a party seeking such fees must offer 

the testimony of a witness who has been designated as an expert, See E.F. Hutton & Co. v. 

Youngblood, 741 S.W.2d 363, 364 (Tex. 1987); Lesikar, 33 S.W.3d at 307, or at the very least, some 

testimony by the claimant’s attorney that the fees 

being sought as damages are reasonable. Gulf 

Paving Co. v. Lofstedt, 144 Tex. 17, 188 S.W.2d 

155, 161 (1945); Nguyen Ngoc Giao v. Smith & 

Lamm, P.C., 714 S.W. 2d 144, 149 (Tex. App.-

Houston [1st Dist.] 1986, no writ).

 

7 GTL conflates the discussion of attorney fees as 

damages and attorney fees sought under section 38.001. 

See Reply Br. 9 (“The American Home court explicitly 

rejected the argument that expert testimony of any kind 

was required to support an award of attorneys’ fees under 

§ 38.001.”); Reply Br. 11 (citing Budd v. Gay, 846 S.W.2d 

521, 524 (Tex. App. 1993), for the proposition that an 

attorney need not be designated as an expert to testify as 

to the reasonableness and necessity of fees, even though 

that case was brought under section 38.001). The decisions in Taurus and American Home, however, make clear 

that the two sources of recovery are doctrinally distinct, 

and the opinions treat them as such.
SECURUS TECHNOLOGIES INC v. GLOBAL TEL*LINK CORP. 17

378 F.3d at 490.8

Based on that passage, GTL argues that Texas law 

does not require expert testimony on the issue of the 

reasonableness and necessity of a party’s attorney fees, as 

long as it offers competent testimony from an attorney 

with regard to that issue. GTL argues that the American 

Home court must have intended to say that an attorney’s 

testimony on reasonableness and necessity does not have 

to be that of an expert, since the court referred to the 

option of either presenting evidence from an expert, or “at 

the very least, some testimony by the claimant’s attorney 

that the fees being sought as damages are reasonable.” 

American Home, 378 F.3d at 490. Therefore, GTL argues, 

the district court in this case committed reversible error 

by holding that Securus was entitled to summary judgment on the attorney fee issue when GTL failed to designate an expert witness before the deadline for designating 

expert witnesses in the scheduling order. 

In fact, neither that passage nor anything else in 

American Home stands for the proposition that Texas law 

does not require expert testimony to support a claim for 

attorney fees as damages in a breach of contract case. All 

that American Home decided with respect to the damages 

issue was that there was insufficient evidence that the 

attorney fees incurred by United Space were reasonable 

and necessary, and that the damages award had to be 

reversed as a result. The question whether the testimony 

of the claimant’s attorney had to be treated as expert 

 

8 GTL also relies on a similar statement by the 

court later in the opinion in which it states that on remand the district court should require that United Space 

“either offer the testimony of a designated expert, or 

testimony by its attorneys, as to why the attorney’s fees 

requested are reasonable and necessary.” 378 F.3d at 

491.
18 SECURUS TECHNOLOGIES INC v. GLOBAL TEL*LINK CORP. 

testimony under Texas law was not before the court and 

was not decided.9 The court’s silence on whether the 

attorney’s testimony had to be treated as expert testimony cannot be considered a holding that under Texas law 

an attorney who testifies as to the reasonableness and 

necessity of particular attorney fees need not be designated as an expert.10

 

9 GTL argues that American Home stands for the 

proposition that an attorney need not be designated as an 

expert because no such designation occurred in that case; 

if the court had regarded such a designation as necessary, 

GTL argues, the court would simply have reversed the 

award of damages rather than remanding for further 

proceedings. The court, however, reversed the damages 

award because there was no evidence as to the reasonableness and necessity of United Space’s attorney fees. 

The court did not discuss the question whether United 

Space should have designated its attorney as an expert or 

how the district court should address that issue if it arose 

on remand. 

10 There are two further indications that the American Home court did not intend to suggest that an attorney 

who testifies as to the reasonableness and necessity of 

attorney fees sought as damages does not need to be 

designated as an expert. First, the cases cited by the

American Home court for the proposition that an attorney 

can provide such evidence, Gulf Paving Co. v. Lofstedt, 

188 S.W.2d 155 (Tex. 1945), and Nguyen Ngoc Giao v. 

Smith & Lamm, P.C., 714 S.W. 2d 144 (Tex. App. 1986), 

both expressly state that the testimony of an attorney on 

such an issue is considered expert testimony.

Second, as noted above, the American Home court 

stated that “[t]he requirement of a designated expert goes 

to the reasonableness of the fees requested.” 378 F.3d at 

493. Because the court held that a showing of reasona-
SECURUS TECHNOLOGIES INC v. GLOBAL TEL*LINK CORP. 19

Thus, the Fifth Circuit’s decision in American Home

does not conflict with the consistent line of Texas cases 

(reinforced by Texas cases decided after American Home, 

such as Woodhaven, Phillips, and Twin City) holding that 

an attorney who testifies as to the reasonableness and 

necessity of attorney fees in a case in which fees are 

sought as damages testifies as an expert. For that reason,

we conclude that the district court in this case correctly 

held that GTL was required to disclose its expert witness—whether an attorney or otherwise—at the time for 

expert witness disclosures according to the scheduling 

order. Because GTL failed to do so, the district court 

permissibly concluded that GTL failed to satisfy the 

requirement of showing that the fees it sought were 

reasonable and necessary. We therefore uphold the 

district court’s decision granting summary judgment to 

Securus on GTL’s counterclaim for attorney fees as damages.

AFFIRMED

Each party shall bear its own costs for this appeal.

 

bleness is required to prove attorney fees as damages (but 

not to establish entitlement to a fee award under section 

38.001), that statement indicates that the court considered expert testimony to be needed under Texas law to 

prove the reasonableness of attorney fees as damages in a 

breach of contract action, where the presumption of 

reasonableness set forth in Tex. Civ. Prac. & Rem. Code 

§ 38.003 is inapplicable.