Legal Question in Insurance Law in Texas

From your question, I assume the following:

Your client sued you and the insurer, and the company settled with the client for $300,000. Now, the suit is just pending against you. The case against you is false and brought just for the purpose of "getting more money" because the insurer did not pay your client enough in settlement.

You have Errors and Omissions insurance.

First, you need to notify your insurance carrier and let them know about the suit. Some policies allow you to choose your own attorney, some require you to accept the attorney of the insurer's choosing, and some policies provide a list of panel counsel - that is, counsel that is pre-approved by the insurer. The approved counsel list is usually attached to the policy as an exhibit to the policy. You will need to look at the defense provisions to determine whether you have the right to choose your counsel.

It is best to discuss a counterclaim with the attorney you ultimately hire. If the client sued you for the Texas Deceptive Practices Act, you can make a counterclaim for groundless suit, and ask for your attorneys' fees. Also, under Texas law, an attorney must believe that the claims made against a defendant are made in good faith, otherwise there could be sanctions. (I warn you, however, that this is very rare).

There are other counterclaims that may be appropriate - slander, libel, and business disparagement - but these should be discussed with your attorney.

Good luck!