CHAPTER 15. MONOPOLIES, TRUSTS AND CONSPIRACIES IN RESTRAINT OF TRADE
BUSINESS AND COMMERCE CODE
TITLE 2. COMPETITION AND TRADE PRACTICES
CHAPTER 15. MONOPOLIES, TRUSTS AND CONSPIRACIES IN RESTRAINT OF
TRADE
SUBCHAPTER A. GENERAL PROVISIONS AND PROHIBITED RESTRAINTS
Sec. 15.01. TITLE OF ACT. This Act shall be known and may be
cited as the Texas Free Enterprise and Antitrust Act of 1983.
Amended by Acts 1983, 68th Leg., p. 3010, ch. 519, Sec. 1, eff.
Aug. 29, 1983.
Sec. 15.02. APPLICABILITY OF PROVISIONS. (a) The provisions of
this Act are cumulative of each other and of any other provision
of law of this state in effect relating to the same subject.
Among other things, the provisions of this Act preserve the
constitutional and common law authority of the attorney general
to bring actions under state and federal law.
(b) If any of the provisions of this Act are held invalid, the
remainder shall not be affected as a result; nor shall the
application of the provision held invalid to persons or
circumstances other than those as to which it is held invalid be
affected as a result.
Amended by Acts 1983, 68th Leg., p. 3010, ch. 519, Sec. 1, eff.
Aug. 29, 1983.
Sec. 15.03. DEFINITIONS. Except as otherwise provided in
Subsection (a) of Section 15.10 of this Act, for purposes of this
Act:
(1) The term "attorney general" means the Attorney General of
Texas or any assistant attorney general acting under the
direction of the Attorney General of Texas.
(2) The term "goods" means any property, tangible or intangible,
real, personal, or mixed, and any article, commodity, or other
thing of value, including insurance.
(3) The term "person" means a natural person, proprietorship,
partnership, corporation, municipal corporation, association, or
any other public or private group, however organized, but does
not include the State of Texas, its departments, and its
administrative agencies or a community center operating under
Subchapter A, Chapter 534, Health and Safety Code.
(4) The term "services" means any work or labor, including
without limitation work or labor furnished in connection with the
sale, lease, or repair of goods.
(5) The terms "trade" and "commerce" mean the sale, purchase,
lease, exchange, or distribution of any goods or services; the
offering for sale, purchase, lease, or exchange of any goods or
services; the advertising of any goods or services; the business
of insurance; and all other economic activity undertaken in whole
or in part for the purpose of financial gain involving or
relating to any goods or services.
Amended by Acts 1983, 68th Leg., p. 3010, ch. 519, Sec. 1, eff.
Aug. 29, 1983; Acts 1991, 72nd Leg., ch. 242, Sec. 6.01, eff.
Sept. 1, 1991; Acts 1995, 74th Leg., ch. 601, Sec. 2, eff. Sept.
1, 1995.
Sec. 15.04. PURPOSE AND CONSTRUCTION. The purpose of this Act
is to maintain and promote economic competition in trade and
commerce occurring wholly or partly within the State of Texas and
to provide the benefits of that competition to consumers in the
state. The provisions of this Act shall be construed to
accomplish this purpose and shall be construed in harmony with
federal judicial interpretations of comparable federal antitrust
statutes to the extent consistent with this purpose.
Amended by Acts 1983, 68th Leg., p. 3010, ch. 519, Sec. 1, eff.
Aug. 29, 1983; Acts 1991, 72nd Leg., ch. 242, Sec. 6.02, eff.
Sept. 1, 1991.
Sec. 15.05. UNLAWFUL PRACTICES. (a) Every contract,
combination, or conspiracy in restraint of trade or commerce is
unlawful.
(b) It is unlawful for any person to monopolize, attempt to
monopolize, or conspire to monopolize any part of trade or
commerce.
(c) It is unlawful for any person to sell, lease, or contract
for the sale or lease of any goods, whether patented or
unpatented, for use, consumption, or resale or to fix a price for
such use, consumption, or resale or to discount from or rebate
upon such price, on the condition, agreement, or understanding
that the purchaser or lessee shall not use or deal in the goods
of a competitor or competitors of the seller or lessor, where the
effect of the condition, agreement, or understanding may be to
lessen competition substantially in any line of trade or
commerce.
(d) It is unlawful for any person to acquire, directly or
indirectly, the whole or any part of the stock or other share
capital or the assets of any other person or persons, where the
effect of such acquisition may be to lessen competition
substantially in any line of trade or commerce.
This subsection shall not be construed:
(1) to prohibit the purchase of stock or other share capital of
another person where the purchase is made solely for investment
and does not confer control of that person in a manner that could
substantially lessen competition;
(2) to prevent a corporation from forming subsidiary or parent
corporations for the purpose of conducting its immediately lawful
business, or any natural and legitimate branch extensions of such
business, or from owning and holding all or a part of the stock
or other share capital of a subsidiary, or transferring all or
part of its stock or other share capital to be owned and held by
a parent, where the effect of such a transaction is not to lessen
competition substantially;
(3) to affect or impair any right previously legally acquired;
or
(4) to apply to transactions duly consummated pursuant to
authority given by any statute of this state or of the United
States or pursuant to authority or approval given by any
regulatory agency of this state or of the United States under any
constitutional or statutory provisions vesting the agency with
such power.
(e) It is unlawful for an employer and a labor union or other
organization to agree or combine so that:
(1) a person is denied the right to work for an employer because
of membership or nonmembership in the labor union or other
organization; or
(2) membership or nonmembership in the labor union or other
organization is made a condition of obtaining or keeping a job
with the employer.
(f) It is not unlawful for:
(1) employees to agree to quit their employment or to refuse to
deal with tangible personal property of their immediate employer,
unless their refusal to deal with tangible personal property of
their immediate employer is intended to induce or has the effect
of inducing that employer to refrain from buying or otherwise
acquiring tangible personal property from a person; or
(2) persons to agree to refer for employment a migratory worker
who works on seasonal crops if the referral is made irrespective
of whether or not the worker belongs to a labor union or
organization.
(g) Nothing in this section shall be construed to prohibit
activities that are exempt from the operation of the federal
antitrust laws, 15 U.S.C. Section 1 et seq., except that an
exemption otherwise available under the McCarran-Ferguson Act (15
U.S.C. Sections 1011-1015) does not serve to exempt activities
under this Act. Nothing in this section shall apply to actions
required or affirmatively approved by any statute of this state
or of the United States or by a regulatory agency of this state
or of the United States duly acting under any constitutional or
statutory authority vesting the agency with such power.
(h) In any lawsuit alleging a contract, combination, or
conspiracy to fix prices, evidence of uniform prices alone shall
not be sufficient to establish a violation of Subsection (a) of
Section 15.05.
(i) In determining whether a restraint related to the sale or
delivery of professional services is reasonable, except in cases
involving price fixing, or other per se violations, the court may
consider, but shall not reach its decision solely on the basis
of, criteria which include: (1) whether the activities involved
maintain or improve the quality of such services to benefit the
public interest; (2) whether the activities involved limit or
reduce the cost of such services to benefit the public interest.
For purposes of this subsection, the term "professional services"
means services performed by any licensed accountant, physician,
or professional engineer in connection with his or her
professional employment or practice.
Amended by Acts 1983, 68th Leg., p. 3010, ch. 519, Sec. 1, eff.
Aug. 29, 1983; Acts 1991, 72nd Leg., ch. 242, Sec. 6.02, eff.
Sept. 1, 1991.
SUBCHAPTER B. PROCEDURE AND EVIDENCE
Sec. 15.10. CIVIL INVESTIGATIVE DEMANDS. (a) Definitions. For
purposes of this section:
(1) The terms "antitrust investigation" and "investigation" mean
any inquiry conducted by the attorney general for the purpose of
ascertaining whether any person is or has been engaged in or is
actively preparing to engage in activities which may constitute
an antitrust violation.
(2) The term "antitrust violation" means any act or omission in
violation of any of the prohibitions contained in Section 15.05
of this Act or in violation of any of the antitrust laws set
forth in Subsection (a) of Section 12 of Title 15, the United
States Code.
(3) The terms "civil investigative demand" and "demand" mean any
demand issued by the attorney general under Subsection (b) of
this section.
(4) The terms "documentary material" and "material" include the
original or any identical copy and all nonidentical copies of any
contract, agreement, book, booklet, brochure, pamphlet, catalog,
magazine, notice, announcement, circular, bulletin, instruction,
minutes, agenda, study, analysis, report, graph, map, chart,
table, schedule, note, letter, telegram, telephone or other
message, product of discovery, magnetic or electronic recording,
and any other written, printed, or recorded matter.
(5) The term "person" means a natural person, proprietorship,
partnership, corporation, municipal corporation, association, or
any other public or private group, however organized, and
includes any person acting under color or authority of state law.
(6) The term "product of discovery" includes without limitation
the original or duplicate of any deposition, interrogatory,
document, thing, result of the inspection of land or other
property, examination, or admission obtained by any method of
discovery in any judicial or administrative proceeding of an
adversarial nature; any digest, analysis, selection, compilation,
or other derivation thereof, and any index or manner of access
thereto.
(b) Authority to Issue Demand. Whenever the attorney general has
reason to believe that any person may be in possession, custody,
or control of any documentary material or may have any
information relevant to a civil antitrust investigation, the
attorney general may, prior to the institution of a civil
proceeding, issue in writing and serve upon such person a civil
investigative demand requiring the person to produce such
documentary material for inspection and copying, to answer in
writing written interrogatories, to give oral testimony, or to
provide any combination of such material, answers, and testimony;
provided, however, that the attorney general may not issue and
serve a demand for documentary material upon a proprietorship or
partnership whose annual gross income does not exceed $5 million.
(c) Contents of Demand.
(1) Each demand shall describe the nature of the activities that
are the subject of the investigation and shall set forth each
statute and section of that statute that may have been or may be
violated as a result of such activities. Each demand shall advise
the person upon whom the demand is to be served that the person
has the right to object to the demand as provided for in this
section.
(2) Each demand for production of documentary material shall:
(A) describe the class or classes of material to be produced
with reasonable specificity so that the material demanded is
fairly identified;
(B) prescribe a return date or dates which will provide a
reasonable period of time within which the material is to be
produced; and
(C) identify the individual or individuals acting on behalf of
the attorney general to whom the material is to be made available
for inspection and copying.
(3) Each demand for answers to written interrogatories shall:
(A) propound the interrogatories with definiteness and
certainty;
(B) prescribe a date or dates by which answers to
interrogatories shall be submitted; and
(C) identify the individual or individuals acting on behalf of
the attorney general to whom the answers should be submitted.
(4) Each demand for the giving of oral testimony shall:
(A) prescribe a reasonable date, time, and place at which the
testimony shall begin; and
(B) identify the individual or individuals acting on behalf of
the attorney general who will conduct the examination.
(5) No demand for any product of discovery may be returned until
20 days after the attorney general serves a copy of the demand
upon the person from whom the discovery was obtained.
(d) Protected Material and Information.
(1) A demand may require the production of documentary material,
the submission of answers to written interrogatories, or the
giving of oral testimony only if the material or information
sought would be discoverable under the Texas Rules of Civil
Procedure or other state law relating to discovery.
(2) Any demand for a product of discovery supercedes any
inconsistent order, rule, or provision of law (other than this
subchapter) preventing or restraining disclosure of such product
of discovery; provided, however, that voluntary disclosure of a
product of discovery under this section does not constitute a
waiver of any right or privilege, including any right or
privilege which may be invoked to resist discovery of trial
preparation materials, to which the person making the disclosure
may be entitled.
(e) Service; Proof of Service.
(1) Service of any demand or of any petition filed under
Subsection (f) or (h) of this section may be made upon any
natural person by delivering a duly executed copy of the demand
or petition to the person to be served or by mailing such copy by
registered or certified mail, return receipt requested, to such
person at his or her residence or principal office or place of
business.
(2) Service of any demand or of any petition filed under
Subsection (f) or (h) of this section may be made upon any person
other than a natural person by delivering a duly executed copy of
the demand or petition to a person to whom delivery would be
appropriate under state law if the demand or petition were
process in a civil suit.
(3) A verified return by the individual serving any demand or
any petition filed under Subsection (f) or (h) setting forth the
manner of service shall be proof of such service. In the case of
service by registered or certified mail, the return shall be
accompanied by the return post office receipt of delivery of the
demand or petition.
(f) Petition for Order Modifying or Setting Aside Demand. At any
time before the return date specified in a demand or within 20
days after the demand has been served, whichever period is
shorter, the person who has been served and, in the case of a
demand for a product of discovery, the person from whom the
discovery was obtained may file a petition for an order modifying
or setting aside the demand in the district court in the county
of the person's residence or principal office or place of
business or in a district court of Travis County. Any such
petition shall specify each ground upon which the petitioner
relies in seeking the relief sought. The petition may be based
upon any failure of such demand to comply with the provisions of
this section or upon any constitutional or other legal right or
privilege of the petitioner. The petitioner shall serve a copy of
the petition upon the attorney general. The attorney general may
submit an answer to the petition. In ruling on the petition, the
court shall presume absent evidence to the contrary that the
attorney general issued the demand in good faith and within the
scope of his or her authority.
(g) Compliance With Demand.
(1) A person on whom a demand is served shall comply with the
terms of the demand unless otherwise provided by court order.
(2) The time for compliance with the demand in whole or in part
shall not run during the pendency of any petition filed under
Subsection (f) of this section; provided, however, that the
petitioner shall comply with any portions of the demand not
sought to be modified or set aside.
(3) Documentary Material.
(A) Any person upon whom any demand for the production of
documentary material has been duly served under this section
shall make such material available to the attorney general for
inspection and copying during normal business hours on the return
date specified in the demand at the person's principal office or
place of business or as otherwise may be agreed upon by the
person and the attorney general. The attorney general shall bear
the expense of any copying. The person may substitute copies for
originals of all or part of the requested documents so long as
the originals are made available for inspection. The person shall
indicate in writing which if any of the documents produced
contain trade secrets or confidential information.
(B) The production of documentary material in response to any
demand shall be made under a sworn certificate in such form as
the demand designates by a natural person having knowledge of the
facts and circumstances relating to such production to the effect
that all of the requested material in the possession, custody, or
control of the person to whom the demand is directed has been
produced.
(4) Interrogatories.
(A) Each interrogatory in any demand duly served under this
section shall be answered separately and fully in writing, unless
it is objected to, in which case the basis for the objection
shall be set forth in lieu of an answer. The person shall
indicate in writing which if any of the answers contain trade
secrets or confidential information.
(B) Answers to interrogatories shall be submitted under a sworn
certificate in such form as the related demand designates by a
natural person having knowledge of the facts and circumstances
relating to the preparation of the answers to the effect that all
of the requested information in the possession, custody, control,
or knowledge of the person to whom the demand is directed has
been set forth fully and accurately.
(5) Oral Examination.
(A) The examination of any person pursuant to a demand for oral
testimony duly served under this section shall be taken before
any person authorized to administer oaths and affirmations by the
laws of Texas or the United States. The person before whom the
testimony is to be taken shall put the witness on oath or
affirmation and shall personally or by someone acting under his
or her direction and in his or her presence record the witness's
testimony. At the expense of the attorney general, the testimony
shall be taken stenographically and may be transcribed.
(B) The oral testimony of any person taken pursuant to a demand
served under this section shall be taken in the county where the
person resides, is found, transacts business, or in such other
place as may be agreed upon by the person and the attorney
general.
(C) Any person compelled to appear under a demand for oral
testimony under this section may be accompanied, represented, and
advised by counsel. Counsel may advise such person in confidence,
either upon the request of such person or upon counsel's own
initiative, with respect to any question arising in connection
with the examination.
(D) The individual conducting the examination on behalf of the
attorney general shall exclude from the place of examination all
other persons except the person being examined, the person's
counsel, the counsel of the person to whom the demand has been
issued, the person before whom the testimony is to be taken, any
stenographer taking the testimony, and any persons assisting the
individual conducting the examination.
(E) During the examination, the person being examined or his or
her counsel may object on the record to any question, in whole or
in part, and shall briefly state for the record the reason for
the objection. An objection may properly be made, received, and
entered upon the record when it is claimed that such person is
entitled to refuse to answer the question on grounds of any
constitutional or other legal right or privilege, including the
privilege against self-incrimination. Neither such person nor his
or her counsel shall otherwise object to or refuse to answer any
question or interrupt the oral examination. If the person refuses
to answer any question, the attorney general may petition the
district court in the county where the examination is being
conducted for an order compelling the person to answer the
question.
(F) If and when the testimony has been fully transcribed, the
person before whom the testimony was taken shall promptly
transmit the transcript of the testimony to the witness and a
copy of the transcript to the attorney general. The witness shall
have a reasonable opportunity to examine the transcript and make
any changes in form or substance accompanied by a statement of
the reasons for such changes. The witness shall then sign and
return the transcript, unless he or she is ill, cannot be found,
refuses to sign, or in writing waives the signing. If the witness
does not sign the transcript within 15 days of receiving it, the
person before whom the testimony has been given shall sign it and
state on the record the reason, if known, for the witness's
failure to sign. The officer shall then certify on the transcript
that the witness was duly sworn and that the transcript is a true
record of the testimony given by the witness and promptly
transmit a copy of the certified transcript to the attorney
general.
(G) Upon request, the attorney general shall furnish a copy of
the certified transcript to the witness.
(H) The witness shall be entitled to the same fees and mileage
that are paid to witnesses in the district courts of Texas.
(h) Failure To Comply With Demand.
(1) Petition for Enforcement. Whenever any person fails to
comply with any demand duly served on such person under this
section, the attorney general may file in the district court in
the county in which the person resides, is found, or transacts
business and serve on the person a petition for an order of the
court for enforcement of this section. If the person transacts
business in more than one county, the petition shall be filed in
the county of the person's principal office or place of business
in the state or in any other county as may be agreed upon by the
person and the attorney general.
(2) Deliberate Noncompliance. Any person, who, with intent to
avoid, evade, or prevent compliance in whole or part with a
demand issued under this section, removes from any place,
conceals, withholds, destroys, mutilates, alters, or by any other
means falsifies any documentary material or otherwise provides
inaccurate information is guilty of a misdemeanor and on
conviction is punishable by a fine of not more than $5,000 or by
confinement in county jail for not more than one year or by both.
(i) Disclosure and Use of Material and Information.
(1) Except as provided in this section or ordered by a court for
good cause shown, no documentary material, answers to
interrogatories, or transcripts of oral testimony, or copies or
contents thereof, shall be available for examination or used by
any person without the consent of the person who produced the
material, answers, or testimony and, in the case of any product
of discovery, of the person from whom the discovery was obtained.
(2) The attorney general may make available for inspection or
prepare copies of documentary material, answers to
interrogatories, or transcripts of oral testimony in his or her
possession as he or she determines may be required by the state
in the course of any investigation or a judicial proceeding in
which the state is a party.
(3) The attorney general may make available for inspection or
prepare copies of documentary material, answers to
interrogatories, or transcripts of oral testimony in his or her
possession as he or she determines may be required for official
use by any officer of the State of Texas or of the United States
charged with the enforcement of the laws of the State of Texas or
the United States; provided that any material disclosed under
this subsection may not be used for criminal law enforcement
purposes.
(4) Upon request, the attorney general shall make available
copies of documentary material, answers to interrogatories, and
transcripts of oral testimony for inspection by the person who
produced such material or information and, in the case of a
product of discovery, the person from whom the discovery was
obtained or by any duly authorized representative of the person,
including his or her counsel.
(5) Not later than 15 days prior to disclosing any documentary
material or answers to written interrogatories designated as
containing trade secrets or confidential information under this
subsection, the attorney general shall notify the person who
produced the material of the attorney general's intent to make
such disclosure. The person who produced the documentary material
or answers to written interrogatories may petition a district
court in any county of this state in which the person resides,
does business, or maintains its principal office for a protective
order limiting the terms under which the attorney general may
disclose such trade secrets or confidential information.
(6) Upon written request, the attorney general shall return
documentary material produced under this section in connection
with an antitrust investigation to the person who produced it
whenever:
(A) any case or proceeding before any court arising out of the
investigation has been completed; or
(B) the attorney general has decided after completing an
examination and analysis of such material not to institute any
case or proceeding before a court in connection with the
investigation.
(j) Jurisdiction. Whenever any petition is filed in the district
court in any county as provided for in this section, the court
shall have jurisdiction to hear and determine the matter
presented and to enter any order or orders required to implement
the provisions of this section. Any final order is subject to
appeal. Failure to comply with any final order entered by a court
under this section is punishable by the court as a contempt of
the order.
(k) Nonexclusive Procedures. Nothing in this section shall
preclude the attorney general from using procedures not specified
in the section in conducting an antitrust investigation;
provided, however, that in conducting such an investigation, the
attorney general shall use the procedures set forth in this
section in lieu of those set forth in Article 1302-5.01 through
Article 1302-5.06, Texas Miscellaneous Corporation Laws Act.
Added by Acts 1983, 68th Leg., p. 3019, ch. 519, Sec. 2, eff.
Aug. 29, 1983.
Sec. 15.11. PARTY TO SUIT MAY SUBPOENA WITNESS. (a) A party to
a suit brought to enforce any of the prohibitions in Section
15.05 of this Act or to enforce the laws conserving natural
resources may apply to the clerk of the court in which the suit
is pending to subpoena a witness located anywhere in the state.
On receipt of the application, the clerk shall issue the subpoena
applied for but may not issue more than five subpoenas for a
party without first obtaining the court's written approval.
(b) A witness subpoenaed under Subsection (a) of this section
who fails to appear and testify in compliance with the subpoena
is guilty of contempt of court and may be fined not more than
$100 and attached and imprisoned in the county jail until he or
she appears in court and testifies as required.
Added by Acts 1983, 68th Leg., p. 3019, ch. 519, Sec. 2, eff.
Aug. 29, 1983.
Sec. 15.12. ADDITIONAL PROCEDURES. In addition to the
procedures set forth in this subchapter, the attorney general and
any other party to a suit brought by the attorney general to
enforce any of the prohibitions in Section 15.05 of this Act may
request discovery and production of documents and other things,
serve written interrogatories, and subpoena and depose witnesses
in accordance with the applicable provisions of the Texas Rules
of Civil Procedure and other state law relating to discovery.
Amended by Acts 1983, 68th Leg., p. 3019, ch. 519, Sec. 2, eff.
Aug. 29, 1983.
Sec. 15.13. IMMUNITY FROM CRIMINAL PROSECUTION. (a)
Application by Attorney General. If a person upon whom an
investigative demand or request for discovery has been properly
served pursuant to Section 15.10, 15.11, or 15.12 of this Act
refuses or is likely to refuse to comply with the demand or
request on the basis of his or her privilege against
self-incrimination, the attorney general may apply to a district
court in the county in which the person is located for an order
granting the person immunity from prosecution and compelling the
person's compliance with the demand or request.
(b) Order Granting Immunity and Compelling Testimony and
Production. Upon receipt of an application filed under Subsection
(a) of this section, the court may issue an order granting the
person immunity from prosecution and requiring the person to
comply with the demand or request notwithstanding his or her
claim of privilege. The order shall explain the scope of
protection afforded by it.
(c) Effectiveness of Order. An order may be issued under
Subsection (b) of this section prior to the assertion of the
privilege against self-incrimination but shall not be effective
until the person to whom it is directed asserts the privilege and
is informed of the order.
(d) Compliance with Order. A person who has been informed of an
order issued by a court under this section compelling his or her
testimony or production of material may not refuse to comply with
the order on the basis of his or her privilege against
self-incrimination. A person who complies with the order may not
be criminally prosecuted for or on account of any act,
transaction, matter, or thing about which he or she is ordered to
testify or produce unless the alleged offense is perjury or
failure to comply with the order. Failure to comply with the
order may be punished by the court as contempt of the order.
Amended by Acts 1983, 68th Leg., p. 3019, ch. 519, Sec. 2, eff.
Aug. 29, 1983.
Sec. 15.16. DECLARATORY JUDGMENT ACTION. (a) A person (other
than a foreign corporation not having a permit or certificate of
authority to do business in this state) uncertain of whether or
not his or her action or proposed action violates or will violate
the prohibitions contained in Section 15.05 of this Act may file
suit against the state for declaratory judgment, citing this
section as authority, in one of the Travis County district
courts.
(b) Citation and all process in the suit shall be served on the
attorney general, who shall represent the state. The petition
shall describe in detail the person's action or proposed action
and all other relevant facts, and the court in its declaratory
judgment shall fully recite the action or proposed action and
other facts considered.
(c) A declaratory judgment granted under this section which
rules that action or proposed action does not violate the
prohibitions contained in Section 15.05 of this Act:
(1) shall be strictly construed and may not be extended by
implication to an action or fact not recited in the judgment;
(2) does not bind the state with reference to a person not a
party to the suit in which the judgment was granted; and
(3) does not estop the state from subsequently establishing a
violation of the prohibitions contained in Section 15.05 of this
Act based on an action or fact not recited in the declaratory
judgment, which action or fact, when combined with an action or
fact recited in the judgment, constitutes a violation of the
prohibitions contained in Section 15.05 of this Act.
(d) A person filing suit under this section shall pay all costs
of the suit.
Amended by Acts 1983, 68th Leg., p. 3019, ch. 519, Sec. 2, eff.
Aug. 29, 1983.
SUBCHAPTER C. ENFORCEMENT
Sec. 15.20. CIVIL SUITS BY THE STATE. (a) Suit to Collect
Civil Fine. The attorney general may file suit in district court
in Travis County or in any county in the State of Texas in which
any of the named defendants resides, does business, or maintains
its principal office on behalf of the State of Texas to collect a
civil fine from any person, other than a municipal corporation,
whom the attorney general believes has violated any of the
prohibitions in Subsection (a), (b), or (c) of Section 15.05 of
this Act. Every person adjudged to have violated any of these
prohibitions shall pay a fine to the state not to exceed $1
million if a corporation, or, if any other person, $100,000.
(b) Suit for Injunctive Relief. The attorney general may file
suit against any person, other than a municipal corporation, in
district court in Travis County, or in any county in the State of
Texas in which any of the named defendants resides, does
business, or maintains its principal office on behalf of the
State of Texas to enjoin temporarily or permanently any activity
or contemplated activity that violates or threatens to violate
any of the prohibitions in Section 15.05 of this Act. In any such
suit, the court shall apply the same principles as those
generally applied by courts of equity in suits for injunctive
relief against threatened conduct that would cause injury to
business or property. In any such suit in which the state
substantially prevails on the merits, the state shall be entitled
to recover the cost of suit.
Upon finding a violation of the prohibition against acquiring the
stock, share capital, or assets of a person in Subsection (d) of
Section 15.05 of this Act, the court shall, upon further finding
that no other remedy will eliminate the lessening of competition,
order the divestiture or other disposition of the stock, share
capital, or assets and shall prescribe a reasonable time, manner,
and degree of the divestiture or other disposition.
(c) No suit filed under Subsection (a) or (b) of this section
may be transferred to another county except on order of the
court.
(d) Nothing in this section shall be construed to limit the
constitutional or common law authority of the attorney general to
bring actions under state and federal law.
Amended by Acts 1983, 68th Leg., p. 3034, ch. 519, Sec. 3, eff.
Aug. 29, 1983.
Sec. 15.21. SUITS BY INJURED PERSONS OR GOVERNMENTAL ENTITIES.
(a) Suit to Recover Damages.
(1) Any person or governmental entity, including the State of
Texas and any of its political subdivisions or tax-supported
institutions, whose business or property has been injured by
reason of any conduct declared unlawful in Subsection (a), (b),
or (c) of Section 15.05 of this Act may sue any person, other
than a municipal corporation, in district court in any county of
this state in which any of the named defendants resides, does
business, or maintains its principal office or in any county in
which any of the named plaintiffs resided at the time the cause
of action or any part thereof arose and shall recover actual
damages sustained, interest on actual damages for the period
beginning on the date of service of such person's pleading
setting forth a claim under the antitrust laws and ending on the
date of judgment (the rate of such interest to be in accordance
with Texas law regarding postjudgment interest rates and the
amount of interest to be adjusted by the court if it finds that
the award of all or part of such interest is unjust in the
circumstances), and the cost of suit, including a reasonable
attorney's fee; provided, however, that if the trier of fact
finds that the unlawful conduct was willful or flagrant, it shall
increase the recovery to threefold the damages sustained and the
cost of suit, including a reasonable attorney's fee; provided
that interest on actual damages as specified above may not be
recovered when recovered damages are increased threefold.
(2) Any person or governmental entity who obtains a judgment for
damages under 15 U.S.C. Section 15 or any other provision of
federal law comparable to this subsection may not recover damages
in a suit under this subsection based on substantially the same
conduct that was the subject of the federal suit.
(3) On a finding by the court that an action under this section
was groundless and brought in bad faith or for the purpose of
harassment, the court shall award to the defendant or defendants
a reasonable attorney's fee, court costs, and other reasonable
expenses of litigation.
(b) Suit for Injunctive Relief. Any person or governmental
entity, including the State of Texas and any of its political
subdivisions or tax-supported institutions, whose business or
property is threatened with injury by reason of anything declared
unlawful in Subsection (a), (b), or (c) of Section 15.05 of this
Act may sue any person, other than a municipal corporation, in
district court in any county of this state in which any of the
named defendants resides, does business, or maintains its
principal office or in any county in which any of the named
plaintiffs resided at the time the cause of action or any part
thereof arose to enjoin the unlawful practice temporarily or
permanently. In any such suit, the court shall apply the same
principles as those generally applied by courts of equity in
suits for injunctive relief against threatened conduct that would
cause injury to business or property. In any such suit in which
the plaintiff substantially prevails on the merits, the plaintiff
shall be entitled to recover the cost of suit, including a
reasonable attorney's fee based on the fair market value of the
attorney services used.
(c) Copies of Complaints to Attorney General. Any person or
governmental entity filing suit under this section shall mail a
copy of the complaint to the Attorney General of Texas. The
attorney general as representative of the public may intervene in
the action by filing a notice of intervention with the court
before which the action is pending and serving copies of the
notice on all parties to the action. The penalty for failure to
comply with this subsection shall be a monetary fine not in
excess of $200. The attorney general may file suit to recover the
fine on behalf of the state in the district court in which the
private suit has been brought.
Amended by Acts 1983, 68th Leg., p. 3034, ch. 519, Sec. 3, eff.
Aug. 29, 1983.
Sec. 15.22. CRIMINAL SUITS. (a) Every person, other than a
municipal corporation, who acts in violation of any of the
prohibitions in Section 15.05(a) or (b) shall be deemed guilty of
a felony and upon conviction shall be punished by confinement in
the Texas Department of Criminal Justice for a term of not more
than three years or by a fine not to exceed $5,000 or by both.
(b) A district attorney or criminal district attorney may file
criminal suit to enforce the provisions in Subsection (a) of this
section in district court in Travis County or in any county in
which any of the acts that allegedly have contributed to a
violation of any of the prohibitions in Subsections (a) and (b)
of Section 15.05 of this Act are alleged to have occurred or to
be occurring.
Amended by Acts 1983, 68th Leg., p. 3034, ch. 519, Sec. 3, eff.
Aug. 29, 1983.
Amended by:
Acts 2009, 81st Leg., R.S., Ch.
87, Sec. 25.010, eff. September 1, 2009.
Sec. 15.24. JUDGMENT IN FAVOR OF THE STATE EVIDENCE IN ACTION.
A final judgment rendered in an action brought under Section
15.20 or 15.22 of this Act to the effect that a defendant or
defendants have violated any of the prohibitions in Section 15.05
of this Act is prima facie evidence against such defendant or
defendants in any action brought under Section 15.21 as to all
matters with respect to which the judgment would be an estoppel
between the parties to the suit. This section shall not apply to
consent judgments or decrees entered before any testimony has
been taken.
Added by Acts 1983, 68th Leg., p. 3034, ch. 519, Sec. 3, eff.
Aug. 29, 1983.
Sec. 15.25. LIMITATION OF ACTIONS. (a) Any suit to recover
damages under Section 15.21 of this Act is barred unless filed
within four years after the cause of action accrued or within one
year after the conclusion of any action brought by the state
under Section 15.20 or 15.22 of this Act based in whole or in
part on the same conduct, whichever is longer. For the purpose of
this subsection, a cause of action for a continuing violation is
considered to accrue at any and all times during the period of
the violation.
(b) No suit under this Act shall be barred on the grounds that
the activity or conduct complained of in any way affects or
involves interstate or foreign commerce. It is the intent of the
legislature to exercise its powers to the full extent consistent
with the constitutions of the State of Texas and the United
States.
Added by Acts 1983, 68th Leg., p. 3034, ch. 519, Sec. 3, eff.
Aug. 29, 1983.
Sec. 15.26. JURISDICTION. Whenever any suit or petition is
filed in the district court in any county in the State of Texas
as provided for in Section 15.10, 15.20, 15.21, or 15.22 of this
Act, the court shall have jurisdiction and venue to hear and
determine the matter presented and to enter any order or orders
required to implement the provisions of this Act. Once suit is
properly filed, it may be transferred to another county upon
order of the court for good cause shown.
Added by Acts 1983, 68th Leg., p. 3034, ch. 519, Sec. 3, eff.
Aug. 29, 1983.
SUBCHAPTER D. RECOVERY OF DAMAGES PURSUANT TO FEDERAL ANTITRUST
LAWS
Sec. 15.40. AUTHORITY, POWERS, AND DUTIES OF ATTORNEY GENERAL.
(a) The attorney general may bring an action on behalf of the
state or of any of its political subdivisions or tax supported
institutions to recover the damages provided for by the federal
antitrust laws, Title 15, United States Code, provided that the
attorney general shall notify in writing any political
subdivision or tax supported institution of his intention to
bring any such action on its behalf, and at any time within 30
days thereafter, such political subdivision or tax supported
institution may, by formal resolution of its governing body or as
otherwise specifically provided by applicable law, withdraw the
authority of the attorney general to bring the intended action.
In any action brought pursuant to this section on behalf of any
political subdivision or tax supported institution of the state,
the state shall retain for deposit in the general revenue fund of
the State Treasury, out of the proceeds, if any, resulting from
such action, an amount equal to the expense incurred by the state
in the investigation and prosecution of such action.
(b) In any action brought by the attorney general pursuant to
the federal antitrust laws for the recovery of damages by the
estate or any of its political subdivisions or tax supported
institutions, in addition to his other powers and authority the
attorney general may enter into contracts relating to the
investigation and the prosecution of such action with any other
party who could bring a similar action or who has brought such an
action for the recovery of damages and with whom the attorney
general finds it advantageous to act jointly, or to share common
expenses or to cooperate in any manner relative to such action.
In any such action the attorney general may undertake, among
other things, either to render legal services as special counsel
to, or to obtain the legal services of special counsel from, any
department or agency of the United States, any other state or any
department or agency thereof, any county, city, public
corporation or public district of this state or of any other
state, that has brought or intends to bring a similar action for
the recovery of damages, or their duly authorized legal
representatives in such action.
Added by Acts 1969, 61st Leg., p. 1708, ch. 559, Sec. 1, eff.
June 10, 1969.
SUBCHAPTER E. COVENANTS NOT TO COMPETE
Sec. 15.50. CRITERIA FOR ENFORCEABILITY OF COVENANTS NOT TO
COMPETE. (a) Notwithstanding Section 15.05 of this code, and
subject to any applicable provision of Subsection (b), a covenant
not to compete is enforceable if it is ancillary to or part of an
otherwise enforceable agreement at the time the agreement is made
to the extent that it contains limitations as to time,
geographical area, and scope of activity to be restrained that
are reasonable and do not impose a greater restraint than is
necessary to protect the goodwill or other business interest of
the promisee.
(b) A covenant not to compete relating to the practice of
medicine is enforceable against a person licensed as a physician
by the Texas Medical Board if such covenant complies with the
following requirements:
(1) the covenant must:
(A) not deny the physician access to a list of his patients whom
he had seen or treated within one year of termination of the
contract or employment;
(B) provide access to medical records of the physician's
patients upon authorization of the patient and any copies of
medical records for a reasonable fee as established by the Texas
Medical Board under Section 159.008, Occupations Code; and
(C) provide that any access to a list of patients or to
patients' medical records after termination of the contract or
employment shall not require such list or records to be provided
in a format different than that by which such records are
maintained except by mutual consent of the parties to the
contract;
(2) the covenant must provide for a buy out of the covenant by
the physician at a reasonable price or, at the option of either
party, as determined by a mutually agreed upon arbitrator or, in
the case of an inability to agree, an arbitrator of the court
whose decision shall be binding on the parties; and
(3) the covenant must provide that the physician will not be
prohibited from providing continuing care and treatment to a
specific patient or patients during the course of an acute
illness even after the contract or employment has been
terminated.
(c) Subsection (b) does not apply to a physician's business
ownership interest in a licensed hospital or licensed ambulatory
surgical center.
Added by Acts 1989, 71st Leg., ch. 1193, Sec. 1, eff. Aug. 28,
1989. Amended by Acts 1993, 73rd Leg., ch. 965, Sec. 1, eff.
Sept. 1, 1993; Acts 1999, 76th Leg., ch. 1574, Sec. 1, eff. Sept.
1, 1999; Acts 2001, 77th Leg., ch. 1420, Sec. 14.729, eff. Sept.
1, 2001.
Amended by:
Acts 2009, 81st Leg., R.S., Ch.
971, Sec. 1, eff. September 1, 2009.
Sec. 15.51. PROCEDURES AND REMEDIES IN ACTIONS TO ENFORCE
COVENANTS NOT TO COMPETE. (a) Except as provided in Subsection
(c) of this section, a court may award the promisee under a
covenant not to compete damages, injunctive relief, or both
damages and injunctive relief for a breach by the promisor of the
covenant.
(b) If the primary purpose of the agreement to which the
covenant is ancillary is to obligate the promisor to render
personal services, for a term or at will, the promisee has the
burden of establishing that the covenant meets the criteria
specified by Section 15.50 of this code. If the agreement has a
different primary purpose, the promisor has the burden of
establishing that the covenant does not meet those criteria. For
the purposes of this subsection, the "burden of establishing" a
fact means the burden of persuading the triers of fact that the
existence of the fact is more probable than its nonexistence.
(c) If the covenant is found to be ancillary to or part of an
otherwise enforceable agreement but contains limitations as to
time, geographical area, or scope of activity to be restrained
that are not reasonable and impose a greater restraint than is
necessary to protect the goodwill or other business interest of
the promisee, the court shall reform the covenant to the extent
necessary to cause the limitations contained in the covenant as
to time, geographical area, and scope of activity to be
restrained to be reasonable and to impose a restraint that is not
greater than necessary to protect the goodwill or other business
interest of the promisee and enforce the covenant as reformed,
except that the court may not award the promisee damages for a
breach of the covenant before its reformation and the relief
granted to the promisee shall be limited to injunctive relief. If
the primary purpose of the agreement to which the covenant is
ancillary is to obligate the promisor to render personal
services, the promisor establishes that the promisee knew at the
time of the execution of the agreement that the covenant did not
contain limitations as to time, geographical area, and scope of
activity to be restrained that were reasonable and the
limitations imposed a greater restraint than necessary to protect
the goodwill or other business interest of the promisee, and the
promisee sought to enforce the covenant to a greater extent than
was necessary to protect the goodwill or other business interest
of the promisee, the court may award the promisor the costs,
including reasonable attorney's fees, actually and reasonably
incurred by the promisor in defending the action to enforce the
covenant.
Added by Acts 1989, 71st Leg., ch. 1193, Sec. 1, eff. Aug. 28,
1989. Amended by Acts 1993, 73rd Leg., ch. 965, Sec. 2, eff.
Sept. 1, 1993.
Sec. 15.52. PREEMPTION OF OTHER LAW. The criteria for
enforceability of a covenant not to compete provided by Section
15.50 of this code and the procedures and remedies in an action
to enforce a covenant not to compete provided by Section 15.51 of
this code are exclusive and preempt any other criteria for
enforceability of a covenant not to compete or procedures and
remedies in an action to enforce a covenant not to compete under
common law or otherwise.
Added by Acts 1993, 73rd Leg., ch. 965, Sec. 3, eff. Sept. 1,
1993.