By: Carona, Shapleigh S.B. No. 513
A BILL TO BE ENTITLED
AN ACT
1-1 relating to a restriction on the use of goods by a purchaser of the
1-2 goods.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Section 15.05, Business & Commerce Code, is
1-5 amended to read as follows:
1-6 Sec. 15.05. Unlawful Practices. (a) Every contract,
1-7 combination, or conspiracy in restraint of trade or commerce is
1-8 unlawful.
1-9 (b) It is unlawful for any person to monopolize, attempt to
1-10 monopolize, or conspire to monopolize any part of trade or
1-11 commerce.
1-12 (c) It is unlawful for any person to sell, lease, or
1-13 contract for the sale or lease of any goods, whether patented or
1-14 unpatented, for use, consumption, or resale or to fix a price for
1-15 such use, consumption, or resale or to discount from or rebate upon
1-16 such price, on the condition, agreement, or understanding that the
1-17 purchaser or lessee shall not use or deal in the goods of a
1-18 competitor or competitors of the seller or lessor, where the effect
1-19 of the condition, agreement, or understanding may be to lessen
1-20 competition substantially in any line of trade or commerce.
1-21 (d) It is unlawful for any person to sell or contract for
1-22 the sale of any goods, whether patented or unpatented, for use,
1-23 consumption, or resale or to fix a price for such use, consumption,
1-24 or resale or to discount from or rebate upon such price, on the
2-1 condition, agreement, or understanding that the purchaser must,
2-2 after use, discard the goods or return the goods to the seller,
2-3 where such condition, agreement, or understanding is unreasonable
2-4 and where the effect of the condition, agreement, or understanding
2-5 may be to lessen competition substantially in any line of trade or
2-6 commerce. An action under this subsection may be initiated only by
2-7 the state.
2-8 (e) It is unlawful for any person to acquire, directly or
2-9 indirectly, the whole or any part of the stock or other share
2-10 capital or the assets of any other person or persons, where the
2-11 effect of such acquisition may be to lessen competition
2-12 substantially in any line of trade or commerce. This subsection
2-13 shall not be construed:
2-14 (1) to prohibit the purchase of stock or other share
2-15 capital of another person where the purchase is made solely for
2-16 investment and does not confer control of that person in a manner
2-17 that could substantially lessen competition;
2-18 (2) to prevent a corporation from forming subsidiary
2-19 or parent corporations for the purpose of conducting its
2-20 immediately lawful business, or any natural and legitimate branch
2-21 extensions of such business, or from owning and holding all or a
2-22 part of the stock or other share capital of a subsidiary, or
2-23 transferring all or part of its stock or other share capital to be
2-24 owned and held by a parent, where the effect of such a transaction
2-25 is not to lessen competition substantially;
2-26 (3) to affect or impair any right previously legally
3-1 acquired; or
3-2 (4) to apply to transactions duly consummated pursuant
3-3 to authority given by any statute of this state or of the United
3-4 States or pursuant to authority or approval given by any regulatory
3-5 agency of this state or of the United States under any
3-6 constitutional or statutory provisions vesting the agency with such
3-7 power.
3-8 (f) [(e)] It is unlawful for an employer and a labor union
3-9 or other organization to agree or combine so that:
3-10 (1) a person is denied the right to work for an
3-11 employer because of membership or nonmembership in the labor union
3-12 or other organization; or
3-13 (2) membership or nonmembership in the labor union or
3-14 other organization is made a condition of obtaining or keeping a
3-15 job with the employer.
3-16 (g) [(f)] It is not unlawful for:
3-17 (1) employees to agree to quit their employment or to
3-18 refuse to deal with tangible personal property of their immediate
3-19 employer, unless their refusal to deal with tangible personal
3-20 property of their immediate employer is intended to induce or has
3-21 the effect of inducing that employer to refrain from buying or
3-22 otherwise acquiring tangible personal property from a person; or
3-23 (2) persons to agree to refer for employment a
3-24 migratory worker who works on seasonal crops if the referral is
3-25 made irrespective of whether or not the worker belongs to a labor
3-26 union or organization.
4-1 (h) [(g)] Nothing in this section shall be construed to
4-2 prohibit activities that are exempt from the operation of the
4-3 federal antitrust laws, 15 U.S.C. Section 1 et seq., except that an
4-4 exemption otherwise available under the McCarran-Ferguson Act (15
4-5 U.S.C. Sections 1011-1015) does not serve to exempt activities
4-6 under this Act. Nothing in this section shall apply to actions
4-7 required or affirmatively approved by any statute of this state or
4-8 of the United States or by a regulatory agency of this state or of
4-9 the United States duly acting under any constitutional or statutory
4-10 authority vesting the agency with such power.
4-11 (i) [(h)] In any lawsuit alleging a contract, combination,
4-12 or conspiracy to fix prices, evidence of uniform prices alone shall
4-13 not be sufficient to establish a violation of Subsection (a) of
4-14 Section 15.05.
4-15 (j) [(i)] In determining whether a restraint related to the
4-16 sale or delivery of professional services is reasonable, except in
4-17 cases involving price fixing, or other per se violations, the court
4-18 may consider, but shall not reach its decision solely on the basis
4-19 of, criteria which include:
4-20 (1) whether the activities involved maintain or
4-21 improve the quality of such services to benefit the public
4-22 interest; and
4-23 (2) whether the activities involved limit or reduce
4-24 the cost of such services to benefit the public interest.
4-25 (k) For purposes of Subsection (j) of this section
4-26 [subsection], the term "professional services" means services
5-1 performed by any licensed accountant, physician, or professional
5-2 engineer in connection with his or her professional employment or
5-3 practice.
5-4 SECTION 2. Section 15.20, Business & Commerce Code, is
5-5 amended to read as follows:
5-6 Sec. 15.20. CIVIL SUITS BY THE STATE. (a) Suit to Collect
5-7 Civil Fine. The attorney general may file suit in district court
5-8 in Travis County or in any county in the State of Texas in which
5-9 any of the named defendants resides, does business, or maintains
5-10 its principal office on behalf of the State of Texas to collect a
5-11 civil fine from any person, other than a municipal corporation,
5-12 whom the attorney general believes has violated any of the
5-13 prohibitions in Subsection (a), (b), or (c) of Section 15.05 of
5-14 this Act. Every person adjudged to have violated any of these
5-15 prohibitions shall pay a fine to the state not to exceed $1 million
5-16 if a corporation, or, if any other person, $100,000.
5-17 (b) Suit for Injunctive Relief. The attorney general may
5-18 file suit against any person, other than a municipal corporation,
5-19 in district court in Travis County, or in any county in the State
5-20 of Texas in which any of the named defendants resides, does
5-21 business, or maintains its principal office on behalf of the State
5-22 of Texas to enjoin temporarily or permanently any activity or
5-23 contemplated activity that violates or threatens to violate any of
5-24 the prohibitions in Section 15.05 of this Act. In any such suit,
5-25 the court shall apply the same principles as those generally
5-26 applied by courts of equity in suits for injunctive relief against
6-1 threatened conduct that would cause injury to business or property.
6-2 In any such suit in which the state substantially prevails on the
6-3 merits, the state shall be entitled to recover the cost of suit.
6-4 Upon finding a violation of the prohibition against acquiring the
6-5 stock, share capital, or assets of a person in Subsection (e) [(d)]
6-6 of Section 15.05 of this Act, the court shall, upon further finding
6-7 that no other remedy will eliminate the lessening of competition,
6-8 order the divestiture or other disposition of the stock, share
6-9 capital, or assets and shall prescribe a reasonable time, manner,
6-10 and degree of the divestiture or other disposition.
6-11 (c) Suit to Collect Actual Damages. In order to recover
6-12 actual damages under Subsection (d) of Section 15.05 of this Act,
6-13 the attorney general may file suit, in district court in Travis
6-14 County or in any county in the State of Texas in which any of the
6-15 named defendants resides, does business, or maintains its principal
6-16 office, on behalf of the State of Texas to recover actual damages
6-17 sustained, interest on actual damages for the period beginning on
6-18 the date of service of the pleading by the State of Texas setting
6-19 forth a claim under the antitrust laws and ending on the date of
6-20 judgment, and the cost of suit, including reasonable attorney's
6-21 fees. The rate of interest under this subsection shall be
6-22 determined in accordance with Texas law regarding postjudgment
6-23 interest rates and the amount of interest shall be adjusted by the
6-24 court if it finds that the award of all or part of such interest is
6-25 unjust under the circumstances. If the trier of fact finds that
6-26 the unlawful conduct was wilful or flagrant, it shall increase the
7-1 recovery to threefold the damages sustained and the cost of suit,
7-2 including reasonable attorney's fees; provided, however, that
7-3 interest on actual damages as specified in this subsection may not
7-4 be recovered when recovered damages are increased threefold.
7-5 (d) No suit filed under Subsection (a), [or] (b), or (c) of
7-6 this section may be transferred to another county except on order
7-7 of the court.
7-8 (e) [(d)] Nothing in this section shall be construed to
7-9 limit the constitutional or common law authority of the attorney
7-10 general to bring actions under state and federal law.
7-11 SECTION 3. The change in law made by this Act applies only
7-12 to a sale or contract for the sale of goods entered into on or
7-13 after the effective date of this Act.
7-14 SECTION 4. This Act takes effect September 1, 1999.
7-15 SECTION 5. The importance of this legislation and the
7-16 crowded condition of the calendars in both houses create an
7-17 emergency and an imperative public necessity that the
7-18 constitutional rule requiring bills to be read on three several
7-19 days in each house be suspended, and this rule is hereby suspended.