Enrolled Bill Summary

            House Bill 1131 amends the Occupations Code to prohibit certain insurers from holding or acquiring an ownership interest in a vehicle repair facility, designated as a "tied repair facility." The bill authorizes an insurer that owns such a facility that was open for business or under construction on April 15, 2003, to maintain that interest and to operate or relocate the facility if the insurer and facility are otherwise in compliance with this provision, but prohibits the insurer from acquiring additional facilities. The bill sets out requirements for a "favored facility agreement," authorizes the insurer to provide support services to its tied repair facility under certain conditions, and requires any agreement between the insurer and the facility to be an arm's-length transaction. The bill requires an insurer that owns a tied repair facility to prominently post a notice on the facility premises to inform customers that the facility is owned wholly or partly by the insurer and that customers may seek repairs at any facility they choose. The bill places other restrictions on the types of activity the insurer may conduct and the information it may share with its tied repair facility.

            The bill allows a party aggrieved by an insurer's violation of this provision to file suit against the insurer to compel its compliance, and it establishes that each day a violation occurs is considered a separate violation. The bill authorizes a court to impose on the insurer a civil penalty of not less than $1,000 or more than $5,000 per violation to be sent to the comptroller for deposit in the general revenue fund. A plaintiff who prevails in an action may recover reasonable attorney's fees and court costs, and a defendant who prevails may be awarded reasonable attorney's fees if the court finds that the action was groundless or was brought in bad faith or for the purpose of harassment. The bill establishes that this provision does not confer immunity from Texas or U.S. antitrust laws, and a sanction or penalty imposed under this provision is in addition to any relief granted under those laws.