Articles Posted in Government & Administrative Law

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A taxpayer that conducts business in multiple states must apportion its business revenue among the states in which it does business. Texas Tax Code section 171.106 provides for such apportionment under a single-factor formula, which compares the taxpayer’s gross receipts derived from its Texas business to its gross receipts everywhere. Section 141.001, however, adopts the Multistate Tax Compact, which sets out a three-factor formula for apportioning“business income” for an“income tax” and provides that a taxpayer subject to a state income tax may elect to apportion its income “in the manner provided by the laws of such state” or may elect to apportion using the Compact’s three-factor formula. The appeals court affirmed the trial court’s summary judgment, holding that apportionment of the Texas franchise tax is exclusively the province of chapter 171. The Supreme Court of Texas affirmed. Section 171.106 provides the exclusive formula for apportioning the franchise tax and, by its terms, precludes the taxpayer from using the Compact’s three-factor formula.The Compact is severable and contains no unmistakable language waiving the state’s exercise of the sovereign tax power. Nothing in the Compact expressly prohibits the states from adopting an exclusive apportionment method that overrides the Compact’s formula. View "Graphic Packaging Corp. v. Hegar" on Justia Law

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The Division of Workers’ Compensation has exclusive jurisdiction over statutory and tort claims alleging the Texas Workers’ Compensation Act’s “bona fide offer of employment” process was misused to fabricate grounds for firing a covered employee. Employee sued Employer’s workers’ compensation carrier and its agent (collectively, Accident Fund), alleging retaliation, conspiracy, and tortious interference claims. Specifically, Employee claimed that Accident Fund participated in the bona-fide-employment-offer-process and that his job offers were “bogus,” thus serving as a pretext for terminating him. Accident Fund filed a plea to the jurisdiction, asserting that exclusive jurisdiction lay with the Division of Workers’ Compensation. The trial court denied the plea. Accident Fund filed a petition for mandamus relief, which the court of appeals denied. The Supreme Court reversed, holding (1) the Division had exclusive jurisdiction over Employee’s claims against Accident Fund; and (2) because Employee did not exhaust administrative remedies through the workers’ compensation administrative process before filing suit, mandamus relief for Accident Fund was appropriate. View "In re Accident Fund General Insurance Co." on Justia Law

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At issue in this workers’ compensation was the meaning of the word “issue” as used in Title 5 of the Labor Code. The trial court ruled that Respondent did not suffer a compensable injury and was therefore not entitled to workers’ compensation. The court also granted the State Office of Risk Management’s (SORM) motion for summary judgment on the ground that Respondent violated a statute by working from home. The court of appeals reversed the grant of summary judgment for SORM and affirmed the denial of Respondent’s motion for summary judgment, concluding that because SORM never presented the statutory-violation ground to the appeals panel at the administrative level, the panel necessarily could not have “decided” that “issue,” and therefore, the Labor Code barred the trial court from exercising jurisdiction over SORM’s motion. The Supreme Court affirmed in part and reversed in part, holding (1) the statutory ground SORM argued in its summary judgment motion was an argument supporting resolving in SORM’s favor the issue of whether Respondent was in the course and scope of her employment at the time of her accident, and therefore, SORM was free to raise the statutory argument at any time; and (2) Respondent’s motion for summary judgment was properly denied. View "State Office of Risk Management v. Martinez" on Justia Law

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When Cadena Comercial USA Corp., a company formed to operate convenience stores, sought a retailer’s permit to sell alcohol, the Texas Alcoholic Beverage Commission (TABC) protested, arguing that, if the permit were granted, the ownership interests of Fomento Economico Mexicano, S.A.B. de C.V. (FEMSA) in Cadena and the Heineken Group, which owns breweries, would violate Texas’s “tied house” statutes that prohibit overlapping ownership between the manufacturing, wholesaling, and retailing segments of the alcoholic beverage industry. The lower courts agreed with the TABC. The Supreme Court affirmed, holding that FEMSA’s indirect ownership interest in the Heineken Group and its breweries, in combination with its indirect ownership interest in Cadena, would result in a violation of Tex. Alco. Bev. Code Ann. 102.07(a) if Cadena’s application for a permit were granted. View "Cadena Comercial USA Corp. v. Texas Alcoholic Beverage Commission" on Justia Law

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In 1994, the Texas State Board of Examiners of Marriage and Family Therapists (the Therapists Board) adopted a rule listing specific therapeutic services that licensed marriage and family therapists (MFTs) may provide. As relevant to this appeal, the rule permits MFTs to provide “diagnostic assessment…to help individuals identify their emotional, mental, and behavioral problems.” In 2008, the Texas Medical Association filed suit against the Board seeking a declaratory judgment that the rule was invalid because it grants MFTs authority that the Texas Licensed Marriage and Family Therapists Act does not grant and that the Texas Medical Practice Act reserves for medical licensees. The trial court granted summary judgment in favor of the Medical Association. The court of appeals affirmed. The Supreme Court reversed, holding that the Texas Occupations Code authorizes MFTs to provide diagnostic assessments, and therefore, the diagnostic-assessment rule is valid. View "Texas State Board of Examiners of Marriage & Family Therapists v. Texas Medical Ass’n" on Justia Law

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Denbury Green Pipeline-Texas, LLC was formed to build and operate a carbon dioxide pipeline known as “the Green Line” as a common carrier in Texas. Denbury Green filed a permit application with the Texas Railroad Commission to obtain common carrier status, which would give it eminent domain authority pursuant to the Texas Natural Resources Code. The Railroad Commission granted Denbury Green the permit. Denbury Green then filed suit against Texas Rice Land Partners, Ltd., James Holland, and David Holland (collectively, Texas Rice) seeking an injunction allowing access to certain real property so that it could complete a pipeline survey. While the suit was pending, Denbury Green took possession of Texas Rice’s property and then surveyed for and constructed the Green Line. The trial court granted summary judgment to Denbury Green. On remand, the court of appeals reversed, concluding that reasonable minds could differ regarding whether, at the time Denbury Green intended to build the Green Line, a reasonable probability existed that the Green Line would serve the public. The Supreme Court reversed, holding that Denbury Green is a common carrier as a matter of law because there was a reasonable probability that, at some point after construction, the Green Line would serve the public, as it does currently. View "Denbury Green Pipeline-Texas, LLC v. Texas Rice Land Partners, Ltd." on Justia Law

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In 2002, the Public Utilities Regulatory Act (PURA) implemented a competitive retail market for electricity in the Electric Reliability Council of Texas. Each incumbent, vertically integrated electric utility within the market was required to unbundle its business activities into separate units, including a transmission and distribution utility (TDU). Of the units, only TDUs continued to be regulated by the Public Utilities Commission (PUC). Here, several parties to a TDU ratemaking proceeding sought judicial review of the PUC’s order. The Supreme Court affirmed in part and reversed in part the judgment of the court of appeals, holding (1) PURA section 36.351, which requires electric electric utilities to discount charges for service provided to state college and university facilities, does not apply to TDUs; (2) former PURA section 36.060(a), which required an electric utility’s income taxes to be computed as though it had filed a consolidated return with a group of its affiliates eligible to do so under federal tax law, did not require a utility to adopt a corporate structure so as to be part of the group; and (3) the evidence in this matter established that franchise charges negotiated by the TDU with various municipalities were reasonable and necessary operating expenses under PURA section 33.008. View "Oncor Electric Delivery Co. v. Public Utility Commission of Texas" on Justia Law

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Southwest Royalties, Inc, an oil and gas exploration company, filed a tax refund claim with the Comptroller asserting that its purchases of casing, tubing, other well equipment, and associated services were exempt from sales taxes under a statutory exemption. The Comptroller denied relief. In response, Southwest sued the Comptroller and the Attorney General. After a bench trial, the trial court rendered judgment for the State, concluding that Southwest failed to meet its burden of proving the exemption applied. The court of appeals affirmed. The Supreme Court affirmed, holding that Southwest was not entitled an exemption from paying sales taxes on purchases of the equipment. View "Southwest Royalties, Inc. v. Hegar" on Justia Law

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Bonnie Jones was injured during the course of her employment. Her employer’s comp carrier, American Home Assurance Company, paid her various benefits but did not pay her supplemental income benefits (SIBs) for the fourteenth quarter of 2011. Jones sued, and the parties settled. Under the Texas workers’ compensation regime, where SIBs are concerned, settlements cannot bypass a statutory formula or facilitate benefits were none were due as a matter of law. In this case, the settlement was noncompliant. The trial court approved the proposed settlement, and the court of appeals affirmed. The Supreme Court reversed, holding that a court cannot condone a noncompliant settlement regarding an SIBs award. View "Tex. Dep’t of Ins., Div. of Workers’ Comp. v. Jones" on Justia Law

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Michael and Laura McIntyre, along with their children that were homeschooled, were criminally charged with contributing to truancy and failure to attend school. The McIntyres sued the District and its attendance officer, alleging that Defendants violated the McIntyres’ rights under both the Texas Constitution and United States Constitution. The District filed pleas, exceptions, and motions arguing that the McIntyres failed to exhaust their administrative remedies. The attendance officer invoked qualified immunity. The trial court denied relief. The court of appeals reversed in part and (1) dismissed the McIntyres’ state-law claims against the District and its attendance officer for the McIntyres’ failure to “exhaust their administrative remedies, and (2) dismissed the federal-law claims against the attendance officer based on qualified immunity. The Supreme Court (1) affirmed the judgment of the court of appeals to the extent it dismissed Plaintiffs’ claims based on qualified immunity; but (2) reversed the judgment insofar as it dismissed the McIntyres’ claims for failure to exhaust administrative remedies, holding the Texas Education Code does not require administrative appeals when a person is allegedly aggrieved by violations of laws other than the state’s school laws, such as the state and federal Constitutions. View "McIntyre v. El Paso Indep. Sch. Dist." on Justia Law