Lead Opinion
delivered the opinion of the Court,
The State of Texas as amicus curiae argues that the certified questions now before us from the United States Court of Appeals for the Fifth Circuit are premised on an incorrect understanding of Texas law. Our dilemma is whether to address the premise of the questions when the parties have not done so, or answer questions that are hypothetical if the State is right. We choose the latter course.
The Texas Optometry Act
In 1992, Wal-Mart Stores, Inc. (‘Wal-Mart”) began operating “Vision Centers” in its Texas retail stores, selling a variety of ophthalmic goods, such as spectacle lenses, frames, and contact lenses. Wal-Mart leased office space near the Vision Centers to optometrists. A typical lease required the optometrist to keep the office open at least 45 hours per week or pay $200 per day in liquidated damages.
The Act provides that “[a] manufacturer, wholesaler, or retailer of ophthalmic goods may not directly or indirectly ... control or attempt to control the professional judgment, manner of practice, or practice of an optometrist”.
In 1995, the Board advised Wal-Mart that its minimum office-hour requirement violated the Act. Wal-Mart dropped the requirement and changed its lease form, allowing an optometrist lessee to insert daily hours of operation and providing that it would “retain no control whatsoever over the manner and means by which the [optometrist] performs his/her work.” In the Board’s view, these changes were not sufficient to comply with the Act. In 1998, the Board published a newsletter in which it opined that any commercial lease merely referencing an optometrist’s hours violated
In 2007, four Texas optometrists—Doris Forte, Bridget Leesang, David Wiggins, and John Boldan (“the Optometrists”)—all with post-1995 Wal-Mart leases, sued Wal-Mart in federal district court.
The district court instructed the jury that the Optometrists “do not claim that they have suffered any physical or economic damages [and] only seek to recover civil penalties.” The jury awarded the Optometrists $3,953,000 in civil penalties— $1,000 for every day the Optometrists had operated under the leases, the maximum penalty allowed by the Act. The jury also awarded the Optometrists $763,854 in attorney fees. Post-verdict, the court ordered a remittitur, which the Optometrists accepted, reducing the civil penalty to $400 per day, totaling $1,396,400.
On appeal, Wal-Mart contended that its conduct did not violate the Act. The Fifth Circuit rejected this argument.
1. Whether an action for a “civil penalty” under the Texas Optometry Act is an “action in which a claimant seeks damages relating to a cause of action” within the meaning of Chapter 41 of the ■Texas Civil Practice and Remedies Code. In other words, are civil penalties awarded under Tex. Occ.Code § 351.605 “damages” as that term is used in Tex. Civ. Prac. & Rem.Code § 41.002(a).
2, If civil penalties awarded under the Texas Optometry Act are “damages” as that term is used in Tex. Civ. Prac. &Rem.Code § 41.002(a), whether they are “exemplary damages” such that Tex. Civ. Prac. & Rem.Code § 41.004(a) precludes their recovery in any case where a plaintiff does not receive damages other than nominal damages. 23
As usual, the Circuit added: “We disclaim any intention or desire that the Supreme Court of Texas confíne its reply to the precise form or scope of the questions certified.”
We accepted the certification.
The State of Texas as amicus curiae argues that Section 351.605 of the Act does not authorize a private suit for penalties. The “remedies” in Section 351.603(b) to which an injured person “is entitled to” under Section 351.605 are not civil penalties, the State contends, but actions for civil penalties brought by the Attorney General or the Board. The State points to Brown v. De La Cruz, where we said that “a statute providing for a daily penalty unrelated to actual losses must be strictly construed, and may be asserted in a private cause of action only if the statute clearly so provides.”
The State’s argument has force. If it is right, we need not consider the effect of Chapter 41 on the recovery of penalties, the subject of the certified questions. We might consider the Fifth Circuit’s disclaimer of precise limitation on the scope of the questions to allow us to reach the State’s argument, but the parties have not chosen to engage on this issue, and we are reluctant to do so without the benefit of their arguments. We are also reluctant to direct them to argue an issue they have elected not to raise. We might decline to answer the certified questions at all, but that would deprive the Fifth Circuit of the guidance it has sought and perversely suggest an end result contrary to the one we would reach. We faced a similar predicament in Diamond Shamrock Refining and Marketing Co. v. Mendez, where Diamond Shamrock argued that malice should be an element of false light invasion of privacy, a tort we had never recognized, but did not argue that the tort itself should not exist.
Chapter 41 “applies to any action in which a claimant seeks damages relating to a cause of action”,
“Exemplary damages” means any damages awarded as a penalty or by way of punishment but not for compensatory purposes. Exemplary damages are neither economic nor noneconomic damages. “Exemplary damages” includes punitive damages.33
Thus, Chapter 41 applies to “any action” in which exemplary damages are sought. Indeed, most of Chapter 41 governs and limits the recovery of exemplary damages.
Chapter 41 does not refer to civil penalties. To determine whether they are damages, when neither is defined in the statute, we could look to the ordinary meanings of the words. Here, that is of little help. The Optometrists cite the definition of “damages” in the fifth edition of Black’s Law Dictionary as “[a] pecuniary compensation or indemnity” or “a compensation in money for a loss or damage”
We could also look to our own cases or other authorities. We have noted that civil penalties are different from compensatory damages
Given the breadth of Chapter 41, we cannot read in exceptions that would impair its purpose. The Optometrists argue civil penalties under the Act need not be governed by Chapter 41 because they are already limited to at most $1,000 per day,
The Optometrists argue that the Act provides for recovery of both damages
The Optometrists argue that if Chapter 41 applies to their recovery of sanctions, then it also applies to the Attorney General’s or the Board’s imposition of sanctions. But this argument is flawed for at least two reasons. First, the Attorney General and the Board could rarely, if ever, recover damages, so the application of Chapter 41 would destroy their enforcement powers under the Act. And second, the imposition of sanctions by the government is limited by institutional constraints not present when the claimant is a private person.
The Optometrists argue that if Chapter 41 applies to civil penalties under the Act, it must apply to all civil penalties under all statutes. They identify 24 Texas statutes allowing for both damages and civil penalties, and seven others allowing for civil penalties without mentioning damages. But whether Chapter 41 applies to any of these other statutes depends on the analysis we have followed here, not simply on a statutory authorization of civil penalties.
The Optometrists concede that Chapter 41 damages include compensatory damages, statutory multiple damages, and statutory additional damages. The only private monetary recovery excluded in their view is civil penalties. We cannot find justification in the statute for this exception. We conclude that a private recovery of civil penalties under the Act is subject to Chapter 41.
The Optometrists concede that if Chapter 41 damages include private civil penalties under the Act, it is difficult to argue that they are not “exemplary damages”—“damages awarded as a penalty or by way of punishment but not for compensatory purposes.”
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With the reservations we have noted regarding the premise underlying the certified questions, we answer both yes.
Notes
.Tex. Occ. Code §§ 351.001-.608. The predecessor to the current Act was passed in 1969, codified as article 4552 of the Texas Revised Civil Statutes, and recodified as Chapter 351 of the Occupations Code in 1999. Act of May 21, 1969, 61st Leg., R.S., ch. 401, 1969 Tex. Gen. Laws 1298 (amended 1981, 1991, and 1999) (formerly codified at Tex. Rev. Civ. Stat. Ann. arts. 4552-1.01 to 4552-6.04), repealed and recodified, Act of May 13, 1999, 76th Leg., ch. 388, §§ 1, 6, 1999 Tex. Gen. Laws 1431, 1720, 2440. The provisions now found in Sections 351.408, 351.603(b), and 351.605 were added in 1981 and have been in effect, substantially unchanged, at all times material to this case. Act of June 1, 1981, 67th Leg., R.S., ch. 758, § 2, 1981 Tex. Gen. Laws 2798, 2807 (formerly codified at Tex. Rev. Civ. Stat. Ann. art. 4552-5.11).
. Tex. Occ. Code § 351.408 (formerly codified as Tex. Rev. Civ. Stat. Ann. art. 4452-5.11(a), (b), (c)).
. Id. §§ 351.051—.163 (describing the board, its membership, powers, and duties).
. Id. § 351.603(b).
. Id. § 351.605.
. Forte v. Wal-Mart Stores, Inc.,
. Tex Civ. Prac. & Rem. Code §§ 41.001-014.
. Tex. Occ. Code § 351.408(c)(1).
. Id. § 351.408(b)(1).
. Id. § 351.603(b) ("The attorney general or board may institute an action against a manufacturer, wholesaler, or retailer of ophthalmic goods in a district court in the county in which a violation of Section 351.408 is alleged to have occurred for injunctive relief and a civil penalty not to exceed $1,000 for each day of a violation plus court costs and reasonable attorney’s fees.”).
. Id. § 351.605 ("A person injured as a result of a violation of Section 351.408, including an optometrist who is a lessee of a manufacturer, wholesaler, or retailer, is entitled to the remedies in Sections 351.602(c)(2), 351.603(b), and 351.604(3).”).
. Id. § 351.602(c)(2) ("A person may institute an action in a district court in the county in which the violation is alleged to have occurred for injunctive relief or damages plus court costs and reasonable attorney’s fees if the person is injured by another person who violates; (1) Section 351.403; or (2) Section 351.408.”).
. Id. § 351.604(3) ("A violation of any of the following sections is actionable under Sub-chapter E, Chapter 17, Business & Commerce Code: ... (3) Section 351.408 .... ’’); see Tex. Bus. & Com. Code§§ 17.41-63.
. Tex Occ. Code § 351.606("(a) A person commits an offense if the person violates this chapter, (b) An offense under Subsection (a) is a misdemeanor punishable by: (1) a fine of not less than $100 or more than $1,000; (2) confinement in county jail for a term of not less than two months or more than six months; or (3) both the fine and confinement, (c) A separate offense is committed each day a violation of this chapter occurs or continues.”).
. The suit was filed on behalf of about 400 similarly situated optometrists, but the court refused to certify a class and required that four test-case plaintiffs be designated.
. While the suit was pending, Wal-Mart deleted the requirement that office hours be stated in its leases and notified all leasing optometrists that it would not enforce any provision related to operating hours.
. Forte v. Wal-Mart Stores, Inc.,
. Tex, Civ. Prac. & Rem. Code § 41.002(a).
. Id. § 41.001(5).
. Id. § 41.004(a).
. Forte,
. Forte,
. Id. at 283.
. Id.
. 58 Tex.Sup.Ct.J. 427 (March 6, 2015). The Fifth Circuit held that Wal-Mart violated the Act. Forte,
.
.
. Id. (deciding the "actual malice” issue in reversing and remanding the cause for a new trial).
. Tex. Civ. Prac. & Rem. Code § 41.002(a).
. Id, § 41.002(d). The exceptions are for actions under Section 15.21 of the Texas Business and Commerce Code (Texas Free Enterprise and Antitrust Act of 1983), Chapter 17 of the Texas Business and Commerce Code
. Id. § 41.002(b).
. Id. § 41.001(4), (5), (8), (9), (12).
. Id. § 41.001(5).
. Black’s Law Dictionary 351 (5th ed.1979).
. See Geters v. Eagle Ins. Co.,
. Black's Law Dictionary 246 (6th ed.1990).
. See Agey v. Am. Liberty Pipe Line Co.,
. In re Longview Energy Co.,
. Wal-Mart cites a variety of federal cases that equate civil penalties and damages, See, e.g., United States v. Ford Motor Co., 497 F.3d
. Tex. Gov’t Code § 311.023(1)~(2).
. Tex. Civ. Prac. & Rem. Code §§ 41.003(a)-(c), 41.005(b), 41.008(c)-(d).
. Id. § 41.011(a).
. Id. §§ 41.003(d), 41.008(a), 41.012.
. Id, § 41.009; see also id. § 41.011(b).
. Id. § 41.003(d).
. Id. § 41.013(a).
. Id. § 41.008(b).
. Id. § 41.004(a).
. Supra note 30.
. Tex. Occ. Code § 351.603(b).
. Id. § 351.602(c)(2).
. Id. § 351.605.
. Tex. Civ. Prac. & Rem. Code § 41.002(b).
. Id. § 41.001(5).
Dissenting Opinion
dissenting.
I would not answer the certified questions in this case because they are based on the premise that the Texas Optometry Act authorizes private persons to sue for civil penalties. The State, as amicus curiae, argues that the Act does not create a private right of action for civil penalties,
I disagree with the Court’s decision to answer the questions as if their premise were correct. If the premise is incorrect, as it appears to be, answering the questions without first addressing the premise will only cause confusion and a waste of judicial and other resources. I would ask the parties to brief the premise and decide that issue first. At a minimum, I would advise the Fifth Circuit and the parties of our concerns about the premise and decline to answer the questions. I also disagree with the Court’s answers to the certified questions, which seem to result more from the assumption that the premise is correct than from the relevant statutory language. Based on the statutory language, I conclude that civil penalties awarded under the Optometry Act are not “damages” or “exemplary damages” under Chapter 41. I write briefly to explain both reasons for my dissent.
I.
The Questions
The Optometry Act makes it unlawful for a manufacturer, wholesaler, or retailer of ophthalmic goods to “directly or indirectly ... control or attempt to control the professional judgment, manner of practice, or practice of an optometrist.” Tex, Ooc. Code § 351.408(c)(1). “A person injured as a result of a violation” of that prohibition “is entitled to the remedies in Sections 351.602(c)(2), 351.603(b), and 351.604(3).” Id. § 351.605. The three remedies are:
• “A person may institute an action in a district court ... for injunctive relief or damages plus court costs and reasonable attorney’s fees,” id. § 351.602(c);
• “The attorney general or [Texas Optometry Board] may institute an action ... for injunctive relief and a civil penalty not to exceed $1,000 for each day of a violation plus court costs and reasonable attorney’s fees;” id. § 351.603(b); and
• “A violation ... is actionable under” the Texas Deceptive Trade Practices-Consumer Protection Act, id. § 351.604.
In this case, the Optometrists successfully sued Wal-Mart for civil penalties under section 351.603(b) and did not seek any actual damages. On appeal, Wal-Mart argues that the civil penalties are “exemplary damages” under Chapter 41 of the Civil Practice and Remedies Code, and the Optometrists cannot recover them because “exemplary damages may be awarded only if damages other than nominal damages are awarded.” Tex. Civ. PRAC. & Rem. Code § 41.004(a). In two certified questions, the United States Court of Appeals for the Fifth Circuit asks us whether civil penalties awarded under the Optometry Act are “damages” under Chapter 41, and if so, whether they are “‘exemplary damages’ such that [section] 41.004(a) precludes their recovery in any case where a plaintiff does not receive damages other than nominal damages.” Forte v. Wal-Mart Stores, Inc.,
This Court has constitutional authority to answer “questions of state law certified
The premise is that the Optometrists can sue for civil penalties under the Optometry Act. Although the parties have not briefed that issue, the Act’s plain language and our precedents indicate that the premise is incorrect. “Generally, a statutory penalty or fine is not payable to a private litigant.” Brown v. De La Cruz,
When a statute that provides for a civil penalty is silent as to who may file suit to recover it, we have “strictly construed” the statute to permit a claim only by “the Attorney General or some other governmental entity or representative.” Id. at 563-65 (holding statute that provided that a “seller who violates Subsection (a) is subject to a penalty” did not create a private cause of action). Even when a statute provided that one-half of a penalty “may be recovered by and for the use of any person” aggrieved by the violation, we concluded that only the government could sue for the penalty because the statute did not expressly state that the aggrieved person could bring the claim. Agey v. Am. Liberty Pipe Line Co., 141 Tex, 379,
The Optometry Act is not silent as to who may sue for civil penalties; it expressly provides that the “attorney general or board may institute an action ... for ... a civil penalty.” Tex. Oco. Code § 351.603(b). Although the Act provides that a “person injured as a result of a violation ... is entitled to” that remedy, id. § 351.605, the remedy that section 351.603(b) provides is a suit by the attorney general or the Optometry Board, not a private cause of action by the injured person. By contrast, the Act expressly provides that an injured person “may institute an action ... for injunctive relief or damages,” id. § 351.602(c), and that a violation “is actionable under” the DTPA, id. § 351.604, which expressly allows a “con
When this Court receives a certified question that is based on a faulty premise, we routinely decline to answer the question. See, e.g., Doody v. Ameriquest Mortg. Co.,
The Court elects to assume the premise is correct and answer the questions, following the course the Court took when it faced a “similar predicament” in Shamrock Refining and Marketing Co. v. Mendez,
A mere twenty months later, however, the Court “join[ed] those jurisdictions that do not recognize the false light invasion of privacy action.” Cain v. Hearst Corp.,
The Court concludes that approach “would be difficult when the matter is outside the questions certified to us,” ante at 464, but the Fifth Circuit expressly “disclaim[s] any intention or desire” that we “confine [our] reply to the precise ... scope of the questions certified.” Forte,
II.
The Answers
Because the Court elects to address the certified questions, I write briefly to explain my disagreement with its answers. The Court concludes that civil penalties awarded under 'the Optometry Act are “damages” and “exemplary damages” under Chapter 41. Ante at 467. As the Court notes, Chapter 41 expressly defines “economic damages,” “exemplary damages,” “compensatory damages,” “future damages," and “noneconomic damages.” Tex, Civ. PRAc. & Rem. Code §§ 41.001(4), (5), (8), (9), (12). But it does not define “damages,” and it “does not refer to civil penalties.” Ante at 465.
In the absence of a statutory definition, we must seek to determine a term’s plain or ordinary meaning. Beeman v. Livingston,
Finding no guidance in our usual sources, the Court bases its answers on Chapter 41’s “object” and “purpose,” which “[unquestionably” is “to restrict and structure the recovery of exemplary damages.” Ante at 466. I agree that is what Chapter 41 does, but that does not answer the question of whether civil penalties are exemplary damages. To say that civil penalties are exemplary damages under Chapter 41 because Chapter. 41 restricts awards of exemplary damages simply begs the question.
Similarly, the Court notes that Chapter 41 expressly states that it does not apply to actions brought under four other statutes, and “[t]he Texas Optometry Act is not one of them.” Ante at 466. The Court concludes it cannot read the Optometry Act' in as an “exception” that would impair Chapter 41’s purpose. Ante at 467. But if civil penalties are not exemplary damages, there is no need for any exception. The question here is not whether Chapter 41 applies to actions under the Optometry Act; the question is whether it restricts a recovery of “civil penalties” under the Optometry Act. The Act permits an action for civil penalties and separately permits an action for damages, but it does not permit a claim for “exemplary, damages.” If civil penalties are not exemplary
Ultimately, I find the Optometrists’ arguments convincing. First, in the absence of any guidance in the language of Chapter 41, I find guidance in the fact that the Optometry Act unambiguously treats “damages” and “civil penalties” as two distinct forms of relief. Compare Tex. Oca Code § 351.602(c) (permitting “[a] person” to recover “damages plus court costs and reasonable attorney’s fees”), with id. § 351.603(b) (permitting the attorney general or board to sue for “a civil penalty”). And the Optometrists identify numerous other Texas statutes that allow recovery of both damages and civil penalties and, like the Optometry Act, treat them as two distinct remedies.
The Court rejects this argument because “the issue is not whether [damages and civil penalties] are different” but “whether Chapter 41 applies to both.” Ante at 466. But whether Chapter 41 applies to both depends on whether they are different. Chapter 41 addresses “damages” and “exemplary damages,” but never mentions civil penalties. If they are the same, Chapter 41 applies to both. If they are different, Chapter 41 applies to a claim for damages but not to a claim for civil penalties. Chapter 41 is unclear, but the Optometry Act and numerous other statutes clearly treat them as different. I would conclude that Chapter 41 does not apply to civil penalties because nothing in that statute indicates or suggests that the term “damages” means something different from what it means in all of the statutes that clearly distinguish between damages and civil penalties.
Second, I find guidance in the fact that the Optometry Act permits only the “attor
Finally, I find guidance in the Optometrists’ argument that applying Chapter 41 to a claim for civil penalties under the Optometry Act would require applying it to all claims for civil penalties. The Court avoids this argument by reasoning that the question of “whether Chapter 41 applies to any of these other statutes depends on the analysis we have followed here.” Ante at 467. But it fails to identify any explanation or example of how that analysis could produce a different result when applied to the other statutes that treat damages and civil penalties as distinct remedies. See supra note 2 and accompanying text. The purpose of civil penalties is always the same, and the question in each application would simply be whether “civil penalties” are “damages” or “exemplary damages” under Chapter 41. The Court provides no reason why the answer would ever be different, and I can think of none.
All of this is not to suggest that the answers in this case are easy. If they were, the Fifth Circuit would have answered them without requesting our help. We must construe Chapter 41 as written, but at least for the questions presented here, it was not written very well. In the end, I would conclude that civil penalties are not damages or exemplary damages under Chapter 41.
III.
Conclusion
Because the certified questions in this case appear to be based on a faulty premise, I would decline to answer them and would either request briefing on the premise and decide that preliminary issue or advise the Fifth- Circuit and parties of our concerns and decline to answer the questions. The Court elects to assume that the premise is correct and proceeds to provide answers that I conclude are incorrect. Therefore, 1 respectfully dissent.
. See Groves v. Gabriel,
. See, e.g., Tex. Gov’t Code § 82.0651(d) (permitting a barratry plaintiff to recover “actual damages” and "a penalty in the amount of $10,000”); Tex. Occ. Code § 1801.154(a) (providing a commission merchant may be liable for “actual damages” and a “penalty of not less than $100 or more than $500”); Tex Prop. Code §§ 27.007 (providing contractor who fails to provide required notice may be liable for "a civil penalty of $500 in addition to” damages), 92.0081(h) (permitting a tenant to recover "a civil penalty of one month’s rent plus $1,000” and “actual damages”), 92.0131(f) (permitting tenant to recover "a civil penalty in the amount of $100 plus any towing or storage costs”), 92.015(c) (permitting a tenant to recover “a civil penalty in an amount equal to one month’s rent” and "actual damages”), 92.016(e) (permitting a tenant to recover "actual damages” and "a civil penalty equal in amount to the amount of one month’s rent plus $500”), 92.0161(f) (same), 92.017(h) (permitting recovery of "actual damages” and "a civil penalty in an amount equal to the amount of one month's rent plus $500”), 92.0562(g)(5) (permitting a tenant to recover "a civil penalty of one month's rent plus $2,000” and "actual damages”), 92.0563(a) (permitting a tenant to recover “actual damages” and “a civil of one month’s rent plus $500”), 92.164(a)(4) (permitting a tenant to recover “actual damages” and “a civil penalty of one month’s rent plus $500”), 92.165(3) (same), 92.260 (permitting a tenant to recover “damages” and “a civil penalty of one month’s rent plus $100”), 92.333 (permitting a tenant to recover "actual damages” and “a civil penalty of one month’s rent plus $500”), 94.158(g)(5) (permitting tenant to recover “actual damages” and “a civil penalty of one month’s rent plus $2,000”), 94.159(a) (permitting a tenant to recover “actual damages” and "a civil penalty of one month’s rent plus $500”), 94.160(a) (permitting a landlord to recover "actual damages” and "a civil penalty of one month’s rent plus $500”), 94.254 (permitting a tenant to recover "actual damages” and “a civil penalty of one month's rent plus $500”), 94.301 (permitting a tenant to recover "actual damages" and “a civil penalty in an amount equal to two months’ rent and $500”); Tex. Transp. Code §§ 5.004(b) (providing common carrier may be liable for "damages” and "a penalty of not less than $5 or more than $500”), 5.008(b) (same).