⚖ Oral Arguments, with Context

The United States Court of Appeals for the Fifth Circuit hears argument in Chavez Law versus Depositors Insurance Company. The core issue is whether a discharged attorney with a contingency fee agreement can sue the opposing party's insurer directly to recover a share of a settlement, or whether the attorney must instead pursue the former client. The case was dismissed at the pleading stage, so no court has found the underlying facts; what follows is the firm's account. Chavez Law says it represented Soto in a personal injury claim for roughly seven weeks under a forty percent contingency fee agreement. It says it sent notice of that interest to the defendant's insurer, was then terminated by the client, and later learned that the insurer paid the entire settlement directly to Soto through new counsel. The firm now seeks its contractual share from the insurer. Depositors Insurance moved to dismiss. It argued that Texas law requires discharged attorneys to sue their own clients, not third parties, absent extraordinary circumstances. The district court agreed and dismissed the suit with prejudice. Chavez Law says the insurer paid with notice of the firm's claimed interest and bears the risk of paying twice. Depositors says the attorney's remedy lies against the client alone. The appeal turns on competing lines of Texas precedent about vested property rights and notice.

Chavez Law v. Depositors Insurance (No. 25-50900) — U.S. Court of Appeals for the Fifth Circuit, argued August 6, 2026.