Doris Forte v. Wal-Mart Stores, Incorporate
780 F.3d 272
5th Cir.2015Background
- Wal-Mart leased Texas storefront space to optometrists, with a 45-hour weekly requirement and a liquidated damages provision.
- In 1995 the Board warned that hours-representation in leases violated the TOA, leading Wal-Mart to remove the 45-hour rule and add a representation of weekly hours with a no-control clause.
- The Board reiterated in 1998 and 2003 that references to hours violated the TOA, but Wal-Mart continued including hours representations in leases.
- In 2007 Forte sued Wal-Mart for TOA violations; three other optometrists were later involved; a jury awarded civil penalties and attorneys’ fees.
- Wal-Mart unsuccessfully challenged liability; remittitur reduced penalties from $1,000/day to $400/day, totaling about $1.396 million; Fifth Circuit then certified questions to Texas Supreme Court.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Are TOA civil penalties damages under Chapter 41? | Forte argues penalties are distinct from damages and may not fall under 41. | Wal-Mart argues penalties fall within damages under 41's broad text. | Issues certified to Texas Supreme Court; not resolved here. |
| If penalties are damages, are they exemplary damages under §41.004? | Penalties may be damages but may not be exemplary; Texas Supreme Court guidance needed. | Penalties could be damages but may or may not be exemplary under §41.004. | Related certification questions to Texas Supreme Court issued. |
| Should the absurdity canon apply to interpret the TOA? | TOA should be read plainly; absurdity canon not warranted. | Plain language may yield absurd results; canon should be considered. | Court rejects absurdity canon; adopts plain meaning interpretation. |
| What is the proper interpretation of 'control or attempt to control' in the TOA as it relates to office hours? | Plain reading includes setting or influencing office hours; Wal-Mart liable. | Limitations should prevent absurd applications; hours control is only one facet. | Plain meaning adopted; Wal-Mart liable under TOA for attempting to control office hours. |
| Should the court certify Texas Supreme Court questions on 41 interaction with TOA penalties? | Certification unnecessary if penalties are damages; court should decide. | Certification is appropriate given unsettled Texas law on penalties and exemplary damages. | Certified questions to Texas Supreme Court regarding damages/exemplary damages under 41. |
Key Cases Cited
- Wright v. Ford Motor Co., 508 F.3d 263 (5th Cir. 2007) (plain-language analysis governs Texas statute interpretation)
- Geters v. Eagle Ins. Co., 834 S.W.2d 49 (Tex. 1992) (damages defined broadly as money for loss or injury)
- Combs v. Health Care Servs., Corp., 401 S.W.3d 623 (Tex. 2013) (absurdity canon reserved for truly exceptional cases)
- In re Nalle Plastics Family Ltd. P’ship, 406 S.W.3d 168 (Tex. 2013) (not all monetary recoveries are damages under Texas law)
- Agey v. Am. Liberty Pipe Line Co., 172 S.W.2d 972 (Tex. 1943) (statutory penalties distinguished from traditional damages)
- BedRoc Ltd., LLC v. United States, 541 U.S. 176 (U.S. Supreme Court 2004) (limits of interpreting amorphous legislative terms)
- Serv. Corp. Int’l v. Guerra, 348 S.W.3d 221 (Tex. 2011) (purpose of punitive damages context for interpreting penalties)
- Fitzgerald v. Advanced Spine Fixation Sys., Inc., 996 S.W.2d 864 (Tex. 1999) (texas statutory interpretation caution against stray language)
- Brown v. De La Cruz, 156 S.W.3d 560 (Tex. 2004) (statutory penalties are strictly construed)