June 17, 2017

All,

Well, the final deadline associated with the regular session has come and gone. Of the 1,211 bills that were passed, 50 were vetoed by Governor Abbott. Except for SB 813 (Remedy for Frivolous State Agency Regulatory Actions), Governor Abbott signed into law all of the monitored bills that passed. A link to the final version of each bill, as well as an overview and the effective date of each bill, are set forth below under the Bills Signed By The Governor heading. (Note: If you prefer not to read the entire list, you can jump to a category by clicking on the subject heading. Once you have completed reading a specific bill summary, you can return to the beginning of the update by clicking on the subject heading for the summarized bill).

Attorney’s Fees and Other Attorney-Related Matters

Constitutional Challenges to Texas Statutes

Decisions Based on Foreign Laws

Elections

Health Care Liability

Immigration/Governmental Immunity

Insurance

Judiciary/Court Administration

Settlement Agreements with Governmental Entities

Trade Secrets

Also, as you know, the Governor has called a special session that will begin on July 18, 2017. Thus far, the Governor has identified 20 items that will be included on the special session call. They are listed below under the Special Session heading. As usual, I will be monitoring bills that are filed during the special session and updating everyone as the session progresses. The bill pre-filing period for the special session begins tomorrow, June 18th.

Reminder: Some of the internal links (i.e., those that hyperlink to locations within the update) may not work on iPad or iPhone. However, the external links (i.e., those that hyperlink to the text of a bill, the bill analysis, and to other documents or video at another location) should work on all web-accessible devices. Hopefully, I’ll have the internal link issue resolved by the time the next regular session begins.

BILLS SIGNED BY THE GOVERNOR

Attorney’s Fees and Other Attorney-Related Matters

SB 302 - Continuation of the State Bar of Texas

· Summary: SB 302, filed by Sen. Kirk Watson (D - Austin), continues the existence of the State Bar of Texas through September 1, 2029. Other notable provisions of the bill include the following:

o Retaining the right of State Bar members to vote on disciplinary rules;

o Prohibiting an increase in bar membership dues by more than 10% during a six-year period unless approved by a vote of State Bar members;

o Requiring barratry reporting in the State Bar’s annual reports about the attorney discipline system;

o Giving the State Bar access to fingerprint-based criminal history data for bar examinees and new State bar members (fingerprints would not be required for those already licensed);

o Maximizing the use of an informal dispute resolution program in the grievance system;

o Creating an independent ombudsman to answer questions regarding the grievance process; and

o Instructing the Supreme Court to ensure that rules governing admission to the bar do not violate Chapter 110 (Religious Freedom) of the Civil Practice & Remedies Code (CPRC).

Effective date: September 1, 2017

· Bill Analysis: Senate Research Center

HB 1704 - Award of Attorney's Fees and Court Costs in Actions to Determine Applicability of Local Government Regulations

· Summary: HB 1704, filed by Rep. John Kuempel (R - Seguin), amends section 245.006 of the Local Government Code to authorize a court to award court costs and attorney’s fees to the prevailing party in a suit to enforce or determine the applicability of a local government regulation.

Effective date: May 29, 2017

· Bill Analysis: House Research Organization

Decisions Based on Foreign Laws (Family Law Cases)

HB 45 - Application of Foreign Laws and Foreign Forum Selection in Texas

· Summary: HB 45, filed by Rep. Dan Flynn (R - Canton), is similar to bills filed in 2011, 2013, and 2015 that failed to pass. HB 45 prohibits a court, arbitrator, or administrative adjudicator in a family law proceeding from basing “a ruling or decision” on “a foreign law,” or otherwise enforcing contract provisions that either require the application of a foreign law to a dispute or require parties to litigate their dispute in a forum outside of the United States if such provisions would violate a right guaranteed by the United States Constitution or the Texas Constitution. Additionally, HB 45 requires the Supreme Court to adopt rules of evidence and procedure to implement the limitations on the granting of comity to a foreign judgment or an arbitration award involving a marriage relationship or a parent-child relationship under the Family Code to protect against violations of constitutional rights and public policy. The rules adopted by the Supreme Court must:

o require that any party who intends to seek enforcement of a judgment or an arbitration award based on foreign law provide timely notice to the court and to each other party, including by providing information required by Rule 203 of the Texas Rules of Evidence, and by describing the court’s authority to enforce or decide to enforce the judgment or award;

o require that any party who intends to oppose the enforcement of a judgment or an arbitration award based on foreign law provide timely notice to the court and to each other party and include with the notice an explanation of the party’s basis for opposition, including by stating whether the party asserts that the judgment or award violates constitutional rights or public policy;

o require a hearing on the record, after notice to the parties, to determine whether the proposed enforcement of a judgment or an arbitration award based on foreign law violates constitutional rights or public policy;

o require that a court state its findings of fact and conclusions of law in a written order determining whether to enforce a foreign judgment or an arbitration award based on foreign law;

o require that a court’s determination be made promptly so that the action may proceed expeditiously; and

o provide that a court “may issue any orders the court considers necessary to preserve principles of comity or the freedom to contract for arbitration while protecting against violations of constitutional rights and public policy in the application of foreign law and the recognition and enforcement of foreign judgments and arbitration awards.”

In addition to the above rules, the Supreme Court must adopt any other rules the Court considers necessary or advisable to accomplish the purposes of the bill and “provide for a course of instruction that relates to issues regarding foreign law, foreign judgments, and arbitration awards in relation to foreign law that arise in actions under the Family Code involving the marriage relationship and the parent-child relationship” for family law judges. The “course of instruction” must include information about: (1) the limits on comity and the freedom to contract for arbitration that protect against violations of constitutional rights and public policy in the application of foreign law and the recognition and enforcement of foreign judgments and arbitration awards in actions brought under the Family Code; and (2) the rules of evidence and procedure adopted under the bill.

Effective date: September 1, 2017. The Supreme Court is required to adopt the rules required by HB 45 no later than January 1, 2018.

· Bill Analysis: House Research Organization

Elections

SB 44 - Filing Requirements for Candidates for Certain Judicial Offices

· Summary: SB 44, filed by Sen. Judith Zaffirini (D - Laredo), adds sections 172.021(e) and (g) to the Election Code and reinstates the petition requirement for certain judicial candidates that was removed in 2015 when the 84th Legislature passed SB 1073. Specifically, under SB 44, candidates for the following judicial offices will have to include a petition with their application to get on the general primary election ballot:

o Chief Justice or justice of the Supreme Court;

o Presiding Judge or judge of the Court of Criminal Appeals;

o Chief Justice or justice of a court of appeals in an appellate district in which a county with a population of more than one million is wholly or partly situated;

o district or criminal district judge of a court in a judicial district wholly contained in a county with a population of more than 1.5 million;

o judge of a statutory county court in a county with a population of more than 1.5 million; and

o justice of the peace in a county with a population of more than 1.5 million.

Effective date: May 23, 2017

· Bill Analysis: House Research Organization

HB 25 - Elimination of Straight-Ticket Voting

· Summary: HB 25, filed by Rep. Ron Simmons (R - Carrollton), amends section 62.011 and other sections of the Election Code to eliminate straight-ticket voting.

Effective date: September 1, 2020

· Bill Analysis: House Research Organization

Health Care Liability

HB 2891 - Medical Authorizations to Release Protected Health Information in Health Care Liability Claims

· Summary: HB 2891, filed by Rep. John Smithee (R - Amarillo), amends section 74.052 of the CPRC to require medical authorizations used to obtain patient health information (PHI) in health care liability claims to include, among other things, the following:

o An authorization to release billing records associated with PHI;

o A category of “Other – Specify: ___________” would be added to the list of permitted purposes for the release of PHI;

o Allows a patient/patient’s legal representative to exclude from disclosure certain types of PHI, including HIV/AIDS test results and/or treatment; drugs/alcohol/substance abuse treatment; mental health records; and genetic information/test results;

o Adds experts to the list of individuals to whom PHI released under this authorization can be disclosed; and,

o Requires a patient/legal representative to notify those identified in the authorization in the event the authorization is revoked.

Effective date: June 9, 2017

· Bill Analysis: House Research Organization

Immigration/Governmental Immunity

SB 4 - State and Local Governmental Entity Enforcement of State and Federal Laws Governing Immigration

· Summary: SB 4, filed by Sen. Charles Perry (R - Lubbock) (but co-authored by multiple senators), will, among other things, prohibit state and local government policies that prevent local law enforcement from inquiring about a person's immigration status and complying with detainer requests. SB 4 also waives sovereign and governmental immunity for those governmental entities that release from custody a person who is the subject of an immigration detainer request issued by the United States Immigration and Customs Enforcement (ICE) and creates liability for damages resulting from a felony committed by the person within 10 years following the person’s release if: (1) the state criminal justice agency, county, or municipality did not detain the person as requested; (2) the person was not a citizen of the United States at the time of release; and (3) the Attorney General (AG) has petitioned the Chief Justice of the Supreme Court to convene the special three-judge district court to hear an action brought under that section against the county or municipality.

SB 4 will also be of interest to appellate courts and practitioners because it creates another accelerated appeal in civil cases brought under section 752.055(b) of the Government Code, which authorizes the AG to file a petition for a writ of mandamus or apply for other appropriate equitable relief to compel compliance by entities or an institution's campus police department that has violated the law relating to immigration enforcement policies.

Effective date: September 1, 2017

· Bill Analysis: House Research Organization

Insurance

HB 1774 - Insurance Claims and Prohibited Acts in the Business of Insurance

· Summary: HB 1774, filed by Rep. Greg Bonnen (R - League City), but co-authored by multiple representatives, amends various sections of the Insurance Code and, among other things, does the following:

o Provides for an election of remedies between Chapter 541 of the Insurance Code and the DTPA;

o Cuts the interest penalty from 18% to prime + 3% and bar the additional recovery of prejudgment interest;

o Requires a claimant seeking damages in an action against an insurer to provide written notice to the insurer at least 61 days prior to filing suit. Pre-suit notices must include the following information: (1) the specific damage items and the amount alleged to be owed by the insurer; (2) the amount of attorney’s fees the claimant reasonably incurred in asserting the claim against the insurer; (3) a statement of the acts or omissions giving rise to the claim; and (4) the identity of any agent whose act or omission caused or contributed to the claimant’s loss of claim.

o Provides an insurer with a right of inspection;

o Limits attorney’s fees (e.g., barring attorney’s fees if an insured fails to timely give notice);

o Establishes a requirement in which a failure to provide requisite notice prior to filing suit would, in certain circumstances, be subject to abatement; and

o Allows an insurer to accept liability for the acts of an agent, thereby preventing a claimant from filing suit against the agent.

Effective date: September 1, 2017. The changes to the law addressed in HB 1744 apply to claims and causes of action filed on or after September 1st.

· Bill Analysis: House Research Organization

Judiciary/Court Administration

SB 1233 - Writs of Mandamus Against Certain Judges (Companion: HB 1480)

· Summary: SB 1233, filed by Sen. Jose Rodriguez (D - El Paso), amends section 22.221(b) of the Government Code to add statutory county, statutory probate county court judges, and associate judges of a district or county court appointed by a judge under Chapter 201, Family Code to the list of judges against whom a court of appeals may issue writs of mandamus.

Effective date: September 1, 2017. The changes to the law addressed in SB 1233 will apply only to a proceeding seeking a writ of mandamus filed in a CA on or after the effective date.

· Bill Analysis (SB 1233): House Research Organization

HB 1480: The companion to SB 1233, HB 1480 (filed by Rep. Senfronia Thompson (D - Houston)), also passed in both chambers. However, the final version of HB 1480 did not include provisions that added statutory county and statutory probate county court judges to the list of those courts subject to mandamus.

Effective date: September 1, 2017. The changes to the law addressed in HB 1480 will apply to a suit filed on or after the effective date.

· Bill Analysis (HB 1480): House Research Organization

SB 1893 - Redistricting of Administrative Judicial Regions

· Summary: SB 1893, filed by Sen. Brian Birdwell (R - Granbury) and Sen. Judith Zaffirini (D - Laredo), creates two new administrative judicial regions by splitting the 1st (Northeast Texas, including Dallas County) and the 2nd (Southeast Texas, including Harris County) regions and changes region boundaries. SB 1893 also requires the Texas Judicial Council to collect judicial statistics and other pertinent information from the presiding judges of each administrative judicial region regarding the amount and character of any business transacted by the presiding judges. The presiding judges are required to report monthly any information required by the Judicial Council.

Effective date: The portion of SB 1893 that creates the two new administrative judicial regions is effective September 1, 2017. The remaining sections of the bill are effective June 15, 2017.

· Bill Analysis: House Research Organization

HB 214 - Recording of Certain Supreme Court and Court of Criminal Appeals Proceedings

· Summary: HB 214, filed by Rep. Terry Canales (D- Edinburg), adds section 22.303 to the Government Code and requires the Supreme Court and Court of Criminal Appeals to (1) make a video recording (or other electronic visual and audio recording) of each oral argument and public meeting, and (2) post the recording on each court’s website, provided that the cost associated with the recording of such proceedings are funded by private sources. The Legislature appropriated funds for the CCA to perform the tasks addressed in the bill. The Supreme Court already posts video recordings of oral argument and other public meetings on its website.

Effective date: September 1, 2017

· Bill Analysis: Senate Research Center

HB 1761 - Supreme Court Jurisdiction

· Summary: HB 1761, filed by Rep. John Smithee (R - Amarillo), amends section 22.001 of the Government Code and does the following: (1) removes all grounds of jurisdiction except for “important to the jurisdiction of the state;” (2) provides that appeals may be taken to the Supreme Court only after the appeal was first taken to the court of appeals unless it is an appeal from injunctions based on the constitutionality of a statute; (3) deletes the phrases “coextensive with the limits of the state” and “extending to all questions of law;” and (4) repeals the conflicts jurisdiction provision (section 22.001(e)). HB 1761 also repeals and/or amends provisions of section 22.007 to eliminate references to the “application for writ of error” and verbiage associated with the writ of error process. Finally, the bill repeals portions of section 22.225 of the Government Code, thereby expanding the Court’s jurisdiction to hear all interlocutory appeals that involve issues important to the jurisprudence of the state.

Effective date: September 1, 2017. The repeal of section 22.225(d) of the Government Code (i.e., which permitted the Supreme Court to consider petitions for review for the interlocutory orders described in CPRC §51.014 (a)(3), (6), (11), and (d)) will apply to interlocutory orders signed on or after the effective date.

· Bill Analysis: House Research Organization

HB 2776 - Superseding a Judgment or Order on Appeal

· Summary: HB 2776, filed by Rep. John Smithee (R - Amarillo), amends section 22.004 of the Government Code to require the Supreme Court to adopt rules to provide that the right of an appellant under CPRC §6.001(b)(1), (2), or (3) to supersede a judgment or order on appeal is not subject to being counter-superseded under Rule 24.2(a)(3) of the Texas Rules of Appellate Procedure, or any other rule. The bill further provides that counter-supersedeas will remain available to parties in a lawsuit concerning a matter that was the basis of a contested case in an administrative enforcement action.

Effective date: September 1, 2017. The Supreme Court will be required to adopt the required rules by May 1, 2018.

· Bill Analysis: Senate Research Center

Settlement Agreements Involving Governmental Entities

HB 53 - Limitations on Settlement Agreements with Governmental Units

· Summary: HB 53, filed by Rep. Ramon Romero, Jr. (D - Fort Worth), prohibits a state or local governmental unit from entering into a settlement of a claim or action against the governmental unit in which: (1) the amount of the settlement is equal to or greater than $30,000; and (2) a condition of the settlement requires the party seeking affirmative relief against the governmental unit to agree not to disclose any fact, allegation, evidence, or other matter to any other person, including a journalist or other member of the media. HB 53 also provides that any provision in a settlement agreement that is in violation of the non-disclosure prohibition is void and unenforceable; however, the bill does not affect information that is privileged or confidential under other law.

Effective date: September 1, 2017. The changes to the law addressed in HB 53 will apply only to a claim or action based on a cause of action that accrues on or after the effective date.

· Bill Analysis: House Research Organization

Trade Secrets

HB 1995 – Amendments to the Texas Uniform Trade Secrets Act

· Summary: HB 1995, filed by Rep. Gary Elkins (R - Houston), amends chapter 134A of the CPRC (a/k/a Texas Uniform Trade Secrets Act (UTSA) to: (1) make the UTSA consistent with the Defend Trade Secrets Act of 1986 passed by Congress in May 2016; (2) add a definition of “clear and convincing evidence” to be consistent with the same definition in other sections of the CPRC; (3) add a definition of “willful and malicious appropriation” (using a 7th Circuit case for guidance); and (4) codify concepts from the Texas Supreme Court’s 2016 decision in In re M-I LLC, which explored the tension between the rights of litigants to hear the evidence presented against them and a trade secret owner’s right to protect the confidentiality of its trade secrets during litigation.

Effective date: September 1, 2017.

· Bill Analysis: House Research Organization

RESOLUTION FILED WITH SECRETARY OF STATE

Constitutional Challenges to Texas Statutes

SJR 6 - Constitutional Amendment Authorizing the Legislature to Require a Court to Notify the Attorney General of Constitutional Challenges to State Statutes

· Summary: SJR 6, filed by Sen. Judith Zaffirini (D - Laredo), would amend the Texas Constitution to specifically authorize the Legislature to (1) require a court to notify the AG of a challenge to the constitutionality of a Texas statute, and (2) prescribe a reasonable period after notice is provided during which the court may not enter a judgment holding a statute unconstitutional. SJR 6 would also require the court in which the challenge is filed to notify the AG of the challenge and provide that the “reasonable period of notice” would not exceed 45 days. [Note: SJR 6 is the legislative response to the 2013 decision by the Court of Criminal Appeals (CCA) (Ex parte Lo) holding that section 402.010(a)-(b) of the Government Code, which prevents a court from entering a final judgment until the AG is notified of a constitutional challenge to a statute, violated the separation-of-powers principles set forth in the Texas Constitution]. As you may recall, the Legislature passed legislation in 2011 (HB 2425) amending the Government Code to require courts to notify the AG when constitutional challenges to state statutes were raised. The law was amended in 2013 to place the burden of notifying the court of the pleading that should be served on the AG on the party raising the constitutional challenge (SB 392).]

Effective date: The proposed constitutional amendment will be submitted to voters at an election to be held on November 7, 2017.

· Resolution Analysis: Senate Research Center

BILL VETOED BY THE GOVERNOR

Frivolous State Agency Regulatory Actions

SB 813 - Recovery of Damages, Attorney's Fees, and Costs Related to a Frivolous Regulatory Action

· Summary: SB 813, filed by Sen. Bryan Hughes (R - Mineola) and others, would have amended section 105 of the CPRC by adding a cause of action for frivolous state agency regulatory actions. More specifically, a claimant would have been permitted to bring an action against a state agency if the state agency took a regulatory action against the claimant that was “frivolous, unreasonable, or without foundation.” Under SB 813, a claimant could have recovered, in addition to all other costs permitted by law or regulation, damages caused by the state agency’s frivolous regulatory action, including reasonable attorney’s fees and costs incurred in defending against a frivolous regulatory action during an administrative proceeding and judicial review of that proceeding, if: (1) the person prevailed in the judicial review of an administrative proceeding; and (2) the state agency was unable to demonstrate that the agency has good cause for the regulatory action. The bill also would have required a claimant to exhaust administrative remedies before pursuing a civil cause of action against a state agency.

Reasons for veto: According to the Governor’s Veto Proclamation, his objections to SB 813 were as follows:

State agencies should be held accountable when they abuse their authority. There are many ways to accomplish that goal other than by enticing trial lawyers to sue the taxpayers for damages. Senate Bill 813 is well-intentioned, but it subjects the State to the possibility of extensive financial liability. Under the bill, taxpayer liability would be triggered any time a judge decides the State’s action is “unreasonable,” a vague and broad standard that varies with the eye of the beholder. This financial liability would be borne by the taxpayers, not by the bureaucrats who caused the problem. The bill was inspired by legitimate concerns about regulatory overreach, but exposing the State fisc to limitless jury verdicts is not the right solution.

· Bill Analysis: House Research Organization

SPECIAL SESSION

On June 6th, Governor Abbott identified 20 items that will be included on the special session call. They are as follows:

  • Sunset legislation
  • Teacher pay increase of $1,000
  • Administrative flexibility in teacher hiring and retention practices
  • School finance reform commission
  • School choice for special needs students
  • Property tax reform
  • Caps on state and local spending
  • Preventing cities from regulating what property owners do with trees on private land
  • Preventing local governments from changing rules midway through construction projects
  • Speeding up local government permitting process
  • Municipal annexation reform
  • Texting while driving preemption
  • Privacy
  • Prohibition of taxpayer dollars to collect union dues
  • Prohibition of taxpayer funding for abortion providers
  • Pro-life insurance reform
  • Strengthening abortion reporting requirements when health complications arise
  • Strengthening patient protections relating to do-not-resuscitate orders
  • Cracking down on mail-in ballot fraud
  • Extending maternal mortality task force

Of course, the Governor has the ability to add items to the special session agenda. There are already rumblings about items possibly being added to the call, so stay tuned.

I will keep everyone informed of developments, if any, as I become aware of them. In the interim, if you have any questions about these topics or any other matter that comes to mind, feel free to contact me. If I do not know the answer to your questions, I’ll do my best to find someone who does.

Sincerely,

Jerry Bullard

Co-Chair, Legislative Liaison Committee

State Bar of Texas Appellate Section

Jerry D. Bullard*
Adams, Lynch & Loftin, P.C.
3950 Highway 360
Grapevine, Texas 76051
O: 817.552.7742
F: 817.328.2942
email: jdb@all-lawfirm.com

* Board Certified - Civil Appellate Law
Texas Board of Legal Specialization


 

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