By Raymond                                            H.B. No. 2723
         77R8298 YDB-F                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to civil actions involving persons who file complaints
 1-3     with governmental agencies.
 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-5           SECTION 1.  Title 6, Civil Practice and Remedies Code, is
 1-6     amended by adding Chapter 138 to read as follows:
 1-7            CHAPTER 138.  CIVIL ACTIONS INVOLVING PERSONS MAKING
 1-8                    COMPLAINTS WITH GOVERNMENTAL AGENCIES
 1-9           Sec. 138.001.  DEFINITIONS.  In this chapter:
1-10                 (1)  "Bad faith" with respect to a claim made the basis
1-11     of a suit governed by this chapter means a claim that is:
1-12                       (A)  groundless; or
1-13                       (B)  brought for the purpose of:
1-14                             (i)  harassing or intimidating a
1-15     complainant; or
1-16                             (ii)  obtaining the withdrawal of a
1-17     complaint.
1-18                 (2)  "Complainant" means a person who makes a complaint
1-19     or who communicates information relevant to a complaint.
1-20                 (3)  "Complaint" means a written or oral statement,
1-21     report, or other communication made to or kept by a governmental
1-22     agency or quasi-governmental entity.
1-23                 (4)  "Exemplary damages" has the meaning assigned by
1-24     Chapter 41.
 2-1                 (5)  "Good faith" with respect to a claim made the
 2-2     basis of a suit governed by this chapter means that at the time the
 2-3     complaint was filed or intended to be filed the complainant had:
 2-4                       (A)  any reasonable basis in fact for making the
 2-5     complaint; and
 2-6                       (B)  any reasonable basis to believe that the
 2-7     governmental agency or quasi-governmental entity to which the
 2-8     complaint was made had authority or jurisdiction to receive the
 2-9     complaint.
2-10                 (6)  "Governmental agency" means:
2-11                       (A)  this state, another state of the United
2-12     States, or the United States;
2-13                       (B)  any court, institution, agency, political
2-14     subdivision, or organ of government established by the constitution
2-15     or laws of this state, of another state of the United States, or of
2-16     the United States, including a department, bureau, board,
2-17     commission, office, or council; or
2-18                       (C)  a law enforcement agency.
2-19                 (7)  "Groundless" means:
2-20                       (A)  without basis in fact; or
2-21                       (B)  not warranted by existing law or a good
2-22     faith argument for the extension, modification, or reversal of
2-23     existing law.
2-24                 (8)  "Harassing conduct" means conduct intended or
2-25     reasonably calculated to threaten, intimidate, coerce, or mislead a
2-26     complainant through the use or threat of:
2-27                       (A)  physical force against a person or property;
 3-1                       (B)  injury or damage to a person's personal or
 3-2     business reputation;
 3-3                       (C)  invasion of a person's right to privacy;
 3-4                       (D)  a tortious or injurious act intended or
 3-5     likely to cause economic damage or severe emotional distress to a
 3-6     person;
 3-7                       (E)  communication of information relevant to a
 3-8     complaint known by the person communicating the information to be
 3-9     false at the time it was communicated; or
3-10                       (F)  an act in violation of the constitution or a
3-11     penal law of this state, another state of the United States, or the
3-12     United States.
3-13                 (9)  "Quasi-governmental entity" means a person who,
3-14     under law or under a formal or informal request by, agreement with,
3-15     delegation of authority by, or rule adopted by a governmental
3-16     agency:
3-17                       (A)  receives or reviews complaints for the
3-18     agency; or
3-19                       (B)  performs a function of the agency.
3-20           Sec. 138.002.  APPLICABILITY; VENUE; REMOVAL.  (a)  This
3-21     chapter applies only to a claim made a basis of a suit filed:
3-22                 (1)  against a complainant that:
3-23                       (A)  is filed by or on behalf of a person who may
3-24     be adversely affected by the filing of the complaint; and
3-25                       (B)  alleges that the contents of or the filing
3-26     of the complaint constitutes a basis for relief, including a claim
3-27     alleging that the contents of the complaint constitute libel or
 4-1     slander; or
 4-2                 (2)  by or on behalf of a complainant alleging conduct
 4-3     giving rise to liability under Section 138.004.
 4-4           (b)  Notwithstanding Subsection (a)(1), this chapter does not
 4-5     apply to a claim if:
 4-6                 (1)  the complaint is confidential by other law and not
 4-7     a public record available to a member of the public who is not
 4-8     affected by the complaint and the complainant communicated the
 4-9     contents of the complaint to a person other than to the
4-10     governmental agency or quasi-governmental entity that initially
4-11     received or reviewed the complaint; or
4-12                 (2)  the complainant is an employee or former employee
4-13     of the person who is the subject of the complaint.
4-14           (c)  This chapter does not create or authorize a cause of
4-15     action against a quasi-governmental entity, a governmental unit, or
4-16     their officers, agents, or employees acting in the course and scope
4-17     of their duties or employment.  Notwithstanding Chapter 104, the
4-18     state is not liable for indemnification of a person for damages
4-19     arising under this chapter.
4-20           (d)  A claim governed by this chapter shall be brought:
4-21                 (1)  in the county of the complainant's residence if
4-22     the complainant is a natural person;
4-23                 (2)  in the county in which the complainant's principal
4-24     office is located if the complainant is not a natural person; or
4-25                 (3)  in the county in which the complaint was made, if
4-26     the complainant:
4-27                       (A)  is a natural person who is not a resident of
 5-1     this state; or
 5-2                       (B)  is not a natural person and does not have an
 5-3     office in this state.
 5-4           (e)  Notwithstanding any other law, on motion of the
 5-5     complainant, a claim governed by this chapter that is brought in a
 5-6     court other than a district court may be removed to a district
 5-7     court in which venue is authorized under Subsection (d).
 5-8           Sec. 138.003.  NO LIABILITY FOR GOOD FAITH COMPLAINT.  (a)  A
 5-9     complainant who makes a complaint in good faith is not:
5-10                 (1)  liable for monetary damages arising from the
5-11     complaint; or
5-12                 (2)  subject to injunctive or declaratory relief with
5-13     respect to the complaint.
5-14           (b)  There is a rebuttable presumption that a complaint is
5-15     made in good faith.
5-16           (c)  A complainant may establish the elements of good faith
5-17     by demonstrating that:
5-18                 (1)  a reasonably prudent person, under the same or
5-19     similar circumstances, could have believed that a reasonable basis
5-20     in fact existed for making the complaint; and
5-21                 (2)  a reasonably prudent person, under the same or
5-22     similar circumstances, could have believed that the governmental
5-23     agency or quasi-governmental entity to which the complaint was made
5-24     had authority or jurisdiction to receive or review the complaint.
5-25           (d)  A person asserting a claim described by Section
5-26     138.002(a)(1) shall, as a condition precedent to stating a cause of
5-27     action for which relief may be granted, have the burden of pleading
 6-1     with particularity all material facts that the person contends
 6-2     establish the right to recovery, including all facts supporting the
 6-3     contention that the complainant did not act in good faith.  Each
 6-4     fact asserted in the pleading must be verified by affidavit made on
 6-5     personal knowledge unless the truth of the fact appears of record. 
 6-6           (e)  The court shall, on motion by the complainant or on the
 6-7     court's own motion, review the pleadings to determine compliance
 6-8     with Subsection (d).
 6-9           Sec. 138.004.  LIABILITY FOR HARASSING CONDUCT; EXEMPLARY
6-10     DAMAGES AUTHORIZED.  (a)  A person is liable for damages to a
6-11     complainant and is subject to injunctive or declaratory relief if
6-12     the complainant demonstrates by a preponderance of the evidence
6-13     that:
6-14                 (1)  the complainant made or intended to make a
6-15     complaint in good faith;
6-16                 (2)  the person committed or caused to be committed
6-17     harassing conduct against the complainant; and
6-18                 (3)  the harassing conduct was committed to:
6-19                       (A)  obtain the withdrawal of the complaint;
6-20                       (B)  prevent or limit the complainant's
6-21     participation in a formal or informal investigation or proceeding
6-22     by a governmental agency or quasi-governmental entity arising from
6-23     or relating to the complaint;
6-24                       (C)  prevent the filing of the complaint; or
6-25                       (D)  retaliate for the complaint.
6-26           (b)  If the trier of fact determines that a complainant has
6-27     demonstrated facts proving liability under Subsection (a), judgment
 7-1     may be entered awarding the complainant:
 7-2                 (1)  actual damages;
 7-3                 (2)  attorney's fees and costs under Section 138.007;
 7-4     and
 7-5                 (3)  notwithstanding Chapter 41, exemplary damages in
 7-6     an amount equal to five times the amount of attorney's fees and
 7-7     costs awarded under Section 138.007.
 7-8           Sec. 138.005.  BAD FAITH CLAIMS; EXEMPLARY DAMAGES
 7-9     AUTHORIZED.  (a)  If the trier of fact determines that a claim
7-10     described by Section 138.002(a)(1) was brought in bad faith,
7-11     judgment may be entered awarding the complainant:
7-12                 (1)  actual damages;
7-13                 (2)  attorney's fees and costs under Section 138.007;
7-14     and
7-15                 (3)  notwithstanding Chapter 41, exemplary damages in
7-16     an amount equal to five times the amount of attorney's fees and
7-17     costs awarded under Section 138.007.
7-18           (b)  A person against whom judgment is entered under this
7-19     section and the person's attorney are jointly and severally liable
7-20     for damages awarded under this section.
7-21           Sec. 138.006.  SUMMARY JUDGMENT; EXPEDITED HEARING TO
7-22     DETERMINE BAD FAITH CLAIM.  (a)  The court shall promptly grant
7-23     summary judgment with respect to a claim described by Section
7-24     138.002(a)(1) if:
7-25                 (1)  the complainant demonstrates that a complaint was
7-26     made in good faith under Section 138.003(c); or
7-27                 (2)  the pleadings fail to allege:
 8-1                       (A)  a cause of action against the complainant
 8-2     for which relief may be granted; or
 8-3                       (B)  facts sufficient to rebut the presumption
 8-4     that the complaint was filed in good faith.
 8-5           (b)  On motion of the complainant, a court that grants
 8-6     summary judgment under Subsection (a) shall promptly hold a hearing
 8-7     to determine whether the claim was brought in bad faith.
 8-8           (c)  A complainant must file the motion for an expedited
 8-9     hearing under Subsection (b) not later than the 30th day after the
8-10     date on which the order granting summary judgment is signed.  On
8-11     request of a party, the hearing shall be before a jury.  The Texas
8-12     Rules of Civil Procedure apply to the selection of the jury, the
8-13     court's charge to the jury, and all other aspects of the
8-14     proceedings.
8-15           (d)  On motion of the complainant in a case involving three
8-16     or more parties, the court shall sever the claims as necessary to
8-17     allow relief granted under Subsection (a) or Section 138.005 to
8-18     become immediately final and appealable.
8-19           Sec. 138.007.  ATTORNEY'S FEES.  A complainant is entitled to
8-20     recover costs of court and reasonable and necessary attorney's fees
8-21     if judgment is entered holding:
8-22                 (1)  a complaint made the basis of a suit under Section
8-23     138.002(a)(1) was filed in good faith; or
8-24                 (2)  a person is liable to the complainant under
8-25     Section 138.004.
8-26           Sec. 138.008.  PROFESSIONAL DISCIPLINE.  (a)  If judgment is
8-27     entered against an attorney under Section 138.005(b), the attorney
 9-1     is subject to professional discipline for professional misconduct
 9-2     in accordance with Subchapter E, Chapter 81, Government Code, and
 9-3     to suspension or disbarment for dishonorable conduct under Section
 9-4     82.062, Government Code.
 9-5           (b)  The court shall promptly report a judgment described by
 9-6     Subsection (a) to an appropriate grievance committee under Chapter
 9-7     81, Government Code, or under a similar law in any jurisdiction in
 9-8     which the attorney resides or is licensed.
 9-9           (c)  A report under Subsection (b) must contain:
9-10                 (1)  the name of the attorney against whom judgment was
9-11     entered;
9-12                 (2)  the jury verdict or findings of fact by the court;
9-13     and
9-14                 (3)  the judgment.
9-15           Sec. 138.009.  CERTAIN ORDERS PROHIBITED.  A court of this
9-16     state may not issue a temporary restraining order, temporary
9-17     injunction, permanent injunction, or other order prohibiting a
9-18     complainant from communicating with a governmental agency or
9-19     quasi-governmental entity concerning the subject matter of a
9-20     complaint or a claim governed by this chapter.
9-21           SECTION 2.  This Act applies only to a claim described by
9-22     Section 138.002, Civil Practice and Remedies Code, as added by this
9-23     Act, filed on or after the effective date of this Act.  A claim
9-24     filed before the effective date of this Act is governed by the law
9-25     applicable to the claim immediately before the effective date of
9-26     this Act, and that law is continued in effect for that purpose.
9-27           SECTION 3.  This Act takes effect September 1, 2001.