78R7869 DAK-F
By: Nixon, Allen, Capelo, Woolley, H.B. No. 4
Cook of Colorado, et al.
Substitute the following for H.B. No. 4:
By: King C.S.H.B. No. 4
A BILL TO BE ENTITLED
AN ACT
relating to reform of certain procedures and remedies in civil
actions.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
ARTICLE 1. CLASS ACTIONS
SECTION 1.01. Subtitle B, Title 2, Civil Practice and
Remedies Code, is amended by adding Chapter 26 to read as follows:
CHAPTER 26. CLASS ACTIONS INVOLVING JURISDICTION
OF STATE AGENCY
Sec. 26.001. DEFINITIONS. In this chapter:
(1) "Agency statute" means a statute of this state
administered or enforced by a state agency.
(2) "Claimant" means a party seeking recovery of
damages or other relief and includes a plaintiff, counterclaimant,
cross-claimant, or third-party claimant.
(3) "Contested case" has the meaning assigned by
Section 2001.003, Government Code.
(4) "Defendant" means a party from whom a claimant
seeks recovery of damages or other relief.
(5) "Rule" has the meaning assigned by Section
2001.003, Government Code.
(6) "State agency" means a board, commission,
department, office, or agency that:
(A) is in the executive branch of state
government;
(B) is created by the constitution or a statute
of this state; and
(C) has statewide jurisdiction.
Sec. 26.002. APPLICABILITY. This chapter applies only to
an action in which:
(1) a claimant seeks recovery of damages or other
relief on behalf of a class of claimants; and
(2) a disputed claim in the action involves the
interpretation, application, or violation of an agency statute or
rule with respect to one or more defendants.
Sec. 26.003. HEARING. (a) On motion of a party, a court
shall conduct a hearing to determine whether an action should be
dismissed or abated under this chapter.
(b) Notice of the hearing must be given to the named parties
to the action on or before the 21st day before the date of the
hearing.
Sec. 26.004. DISMISSAL FOR FAILURE TO EXHAUST
ADMINISTRATIVE REMEDIES. (a) A court shall dismiss an action
without prejudice if:
(1) a state agency has the exclusive jurisdiction to
determine an issue in dispute or grant an administrative remedy
before the claimant can seek a judicial remedy; and
(2) one or more class representatives failed to
exhaust the state agency's administrative remedy.
(b) The court's dismissal order must identify the state
agency having exclusive jurisdiction and state the administrative
remedy available to the claimant.
(c) The limitations period applicable to an action
dismissed under this section is suspended for members of the class
or putative class with respect to the defendants named in the class
action commenced in a court of this state for a period beginning on
the date the dismissal order is signed and continuing while the
class representatives diligently pursue the administrative remedy
identified in the dismissal order.
Sec. 26.005. ABATEMENT OR DISMISSAL. (a) On motion of a
party filed on or before the 30th day after the date the court
signed the order certifying the action as a class action, a court
shall abate or dismiss without prejudice an action if the court
determines that:
(1) an issue in dispute in the action involves a
question of fact within the jurisdiction of a state agency to
determine;
(2) an issue in dispute in the action involves the
application, interpretation, or violation of an agency statute or
rule;
(3) a state agency, if allowed to do so, could make
findings of fact and conclusions of law or issue orders that would
aid the court in resolving the action; or
(4) a state agency, through a contested case
proceeding, could order all or part of the relief a claimant seeks.
(b) The court's abatement or dismissal order must identify
the state agency and state the agency statute or rule on which the
order is based.
(c) A court that abates an action under this section shall:
(1) refer specific issues or claims within a state
agency's jurisdiction to the agency for action; and
(2) direct the state agency to report to the court
periodically concerning the disposition of the matters referred to
the agency.
(d) The limitations period applicable to an action
dismissed under this section is suspended for members of the class
or putative class with respect to the defendants named in the class
action commenced in a court of this state for a period beginning on
the date the dismissal order is signed and continuing while the
class representatives diligently pursue the administrative remedy
identified in the dismissal order.
Sec. 26.006. ABATEMENT PERIOD. (a) The order must provide
that the abatement period is at least six months from the date the
court signs the abatement order.
(b) The court may extend the abatement period if the court
determines that the state agency is proceeding diligently to
resolve the matters the court referred to the agency.
(c) The abatement period ends when:
(1) the state agency takes its final action on the
matters the court referred to the agency; or
(2) the court determines that the state agency is not
proceeding diligently to resolve the matters the court referred to
the agency.
Sec. 26.007. PROCEEDING AFTER ABATEMENT; DISMISSAL. (a)
After the abatement period ends, the court shall decide whether to
dismiss the action, proceed with the action as an individual
action, or proceed with the action as a class action.
(b) A court shall dismiss an action if the court determines
that:
(1) the state agency granted all or a substantial part
of the relief sought by the claimant; or
(2) the relief granted by the state agency is an
adequate substitute for the relief sought in the action by the
claimant.
(c) If the court does not dismiss the action, it shall
determine whether to proceed with the action as a class action or as
an individual action by considering or reconsidering the case in
light of class certification criteria. In determining whether a
class action is superior to other available methods for the fair and
efficient adjudication of the controversy, the court shall consider
the availability of judicial review of the state agency's decision
and of declaratory relief under Section 2001.038, Government Code,
concerning the validity and applicability of agency rules.
(d) Relief awarded to a claimant may be adequate even if the
relief does not include exemplary damages, multiple damages,
attorney's fees, or costs of court.
(e) If a person seeks judicial review of a state agency's
decision on an issue referred to the agency by the court, the court
may transfer the action to a county of proper venue for the judicial
review if the court determines that:
(1) the transfer is necessary to avoid the likelihood
of conflicting or inconsistent judicial decisions affecting the
parties to the action;
(2) the transfer would promote judicial economy;
(3) the transfer would not work a substantial
injustice to the parties to the action; and
(4) the balance of interests of the parties to the
action predominates in favor of transferring the action.
(f) If a person seeks declaratory relief under Section
2001.038, Government Code, concerning the validity or
applicability of a state agency rule involved in a state agency's
decision on a matter referred to the agency by the court, the court
shall transfer the action to Travis County.
SECTION 1.02. Title 6, Civil Practice and Remedies Code, is
amended by adding Chapter 140 to read as follows:
CHAPTER 140. ATTORNEY'S FEES AWARDED IN CLASS ACTIONS
Sec. 140.001. APPLICABILITY. (a) Except as provided by
Subsection (b), this chapter applies to an award of attorney's fees
in a class action notwithstanding:
(1) any agreement between the attorney or attorneys
for the class and any member of the class; or
(2) any other law or rule of court.
(b) This chapter does not apply to fees payable to the
attorney or attorneys by a named plaintiff client out of that
client's funds, including the client's share of the common fund
recovered for the class, under an agreement between the attorney or
attorneys and the client.
Sec. 140.002. NO RIGHT TO FEES CREATED. This chapter does
not create a right to an award of attorney's fees.
Sec. 140.003. AWARD OF FEES. If a court awards a fee in a
class action to the attorney or attorneys for the class, the fee
must be awarded out of a common fund recovered for the class, and
the fee must be computed as provided by this chapter.
Sec. 140.004. DETERMINATION OF BASE FEE. (a) In any class
action in which an award of attorney's fees is to be made, the court
shall first determine the base fee as provided by this section.
(b) The court shall find:
(1) the number of hours that it considers to have been
reasonably and necessarily expended by the attorney or attorneys
for the class; and
(2) the hourly rates it considers to be appropriate
for the services provided by the attorney or attorneys for the
class.
(c) The rates in Subsection (b)(2) must be based on and
cannot exceed the rates customarily charged in the locality for
similar legal services in nonclass litigation.
(d) To compute the base fee, the court shall multiply the
hours found in Subsection (b)(1) by the rates found in Subsection
(b)(2).
Sec. 140.005. INCREASE OR DECREASE OF BASE FEE. (a) Except
as provided by Subsection (b), the court may increase or decrease
the base fee determined under Section 140.004 by applying the
following factors:
(1) the novelty and difficulty of the issues involved
in the action;
(2) the skill required to properly perform the legal
services performed by the attorney or attorneys for the class;
(3) the amount of money involved in the action and the
results obtained;
(4) the time limitations imposed by the class or the
circumstances; and
(5) the experience, reputation, and ability of the
attorney or attorneys performing services for the class.
(b) The total fees awarded by the court may not exceed the
lesser of:
(1) 25 percent of the amounts collected by class
members out of the common fund recovered for the class; or
(2) four times the base fee as determined under
Section 140.004.
Sec. 140.006. ACTUAL EXPENSES AND COSTS. In addition to the
fee determined by the court under this chapter, the court may award
the attorney or attorneys representing the class all reasonable
expenses and costs actually incurred by the attorney or attorneys
on behalf of the class.
SECTION 1.03. Sections 22.225(b) and (d), Government Code,
are amended to read as follows:
(b) Except as provided by Subsection (c) or (d), a judgment
of a court of appeals is conclusive on the law and facts, and a
petition for review [writ of error] is not allowed to [from] the
supreme court, in the following civil cases:
(1) a case appealed from a county court or from a
district court when, under the constitution, a county court would
have had original or appellate jurisdiction of the case, with the
exception of a probate matter or a case involving state revenue laws
or the validity or construction of a statute;
(2) a case of a contested election other than a
contested election for a state officer, with the exception of a case
where the validity of a statute is questioned by the decision;
(3) an appeal from an interlocutory order appointing a
receiver or trustee or from other interlocutory appeals that are
allowed by law;
(4) an appeal from an order or judgment in a suit in
which a temporary injunction has been granted or refused or when a
motion to dissolve has been granted or overruled; and
(5) all other cases except the cases where appellate
jurisdiction is given to the supreme court and is not made final in
the courts of appeals.
(d) A petition for review [writ of error] is allowed to
[from] the supreme court for an appeal from an interlocutory order
described by Section 51.014(a)(3) or (6) [51.014(6)], Civil
Practice and Remedies Code.
SECTION 1.04. Sections 51.014(a) and (b), Civil Practice and
Remedies Code, are amended to read as follows:
(a) A person may appeal from an interlocutory order of a
district court, county court at law, or county court that:
(1) appoints a receiver or trustee;
(2) overrules a motion to vacate an order that
appoints a receiver or trustee;
(3) certifies or refuses to certify a class in a suit
brought under Rule 42 of the Texas Rules of Civil Procedure;
(4) grants or refuses a temporary injunction or grants
or overrules a motion to dissolve a temporary injunction as
provided by Chapter 65;
(5) denies a motion for summary judgment that is based
on an assertion of immunity by an individual who is an officer or
employee of the state or a political subdivision of the state;
(6) denies a motion for summary judgment that is based
in whole or in part upon a claim against or defense by a member of
the electronic or print media, acting in such capacity, or a person
whose communication appears in or is published by the electronic or
print media, arising under the free speech or free press clause of
the First Amendment to the United States Constitution, or Article I
[1], Section 8, of the Texas Constitution, or Chapter 73;
(7) grants or denies the special appearance of a
defendant under Rule 120a, Texas Rules of Civil Procedure, except
in a suit brought under the Family Code; [or]
(8) grants or denies a plea to the jurisdiction by a
governmental unit as that term is defined in Section 101.001;
(9) denies all or part of the relief sought by a motion
under Section 13.01(b), Medical Liability and Insurance
Improvement Act of Texas (Article 4590i, Vernon's Texas Civil
Statutes); or
(10) grants relief sought by a motion under Section
13.01(l), Medical Liability and Insurance Improvement Act of Texas
(Article 4590i, Vernon's Texas Civil Statutes).
(b) An interlocutory appeal under Subsection (a), other
than an appeal under Subsection (a)(4), stays [shall have the
effect of staying] the commencement of a trial in the trial court
pending resolution of the appeal. An interlocutory appeal under
Subsection (a)(3) also stays all other proceedings in the trial
court pending resolution of that appeal.
SECTION 1.05. This article applies only to a suit commenced
or pending on or after the effective date of this article.
ARTICLE 2. SETTLEMENT
SECTION 2.01. Subtitle C, Title 2, Civil Practice and
Remedies Code, is amended by adding Chapter 42 to read as follows:
CHAPTER 42. SETTLEMENT AND RECOVERY OF LITIGATION COSTS
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 42.001. DEFINITIONS. In this chapter:
(1) "Claim" means a request, including a counterclaim,
cross-claim, or third-party claim, to recover monetary damages or
to obtain other relief. The term does not include a request for an
injunction or to recover litigation costs.
(2) "Claimant" means a person making a claim.
(3) "Defendant" means a person from whom a claimant
seeks recovery on a claim, including a counterdefendant,
cross-defendant, or third-party defendant.
(4) "Governmental unit" means the state, a unit of
state government, or a political subdivision of this state.
(5) "Litigation costs" means money actually spent and
obligations actually incurred that are directly related to an
action. "Litigation costs" include:
(A) reasonable attorney's fees;
(B) court costs;
(C) reasonable deposition costs; and
(D) reasonable fees for not more than two expert
witnesses.
(6) "Settlement offer" means an offer to settle or
compromise a claim made in compliance with Section 42.051.
Sec. 42.002. APPLICABILITY AND EFFECT. (a) This chapter
does not apply to an action in which a class has been certified.
(b) Without regard to whether an action is brought by itself
or in conjunction with other actions, this chapter does not apply to
an action:
(1) brought under the Family Code;
(2) brought under Chapter 27, Property Code;
(3) brought on behalf of a minor or person of unsound
mind; or
(4) to collect workers' compensation benefits under
Subtitle A, Title 5, Labor Code.
(c) This chapter does not limit or affect the ability of any
person to:
(1) make an offer to settle or compromise a claim that
does not comply with this chapter; or
(2) offer to settle or compromise a claim to which this
chapter does not apply.
(d) An offer to settle or compromise that does not comply
with Section 42.051 or an offer to settle or compromise made in an
action to which this chapter does not apply does not entitle the
offering party to recover litigation costs under this chapter.
Sec. 42.003. ELECTION BY GOVERNMENTAL UNITS; WAIVER. (a)
This chapter does not apply to an action by or against a
governmental unit unless the governmental unit elects to seek
recovery of litigation costs under this chapter or elects to waive
immunity from liability for costs awarded under this chapter.
(b) To be effective as an election or waiver, the
governmental unit must make the election or waiver specifically and
affirmatively by a writing filed with the court on or before the
45th day after the date the governmental unit files its original
petition or original answer.
(c) An election or waiver is effective only in the action in
which it is filed.
Sec. 42.004. MODIFICATION OF TIME LIMITS. A court may
modify the time limits specified in this chapter by order resulting
from a pretrial conference conducted under Rule 166, Texas Rules of
Civil Procedure.
Sec. 42.005. SERVICE. When this chapter requires a writing
to be served on another party, service is adequate if it is
performed in a manner described in Rule 21a, Texas Rules of Civil
Procedure.
[Sections 42.006-42.050 reserved for expansion]
SUBCHAPTER B. AWARDING LITIGATION COSTS
Sec. 42.051. SETTLEMENT OFFER. (a) A defendant or a group
of defendants may serve on a claimant a settlement offer to settle
all claims in the action between that defendant or those defendants
and the claimant.
(b) The settlement offer must:
(1) be in writing;
(2) state that it is a settlement offer under this
chapter;
(3) state the terms by which the claims may be settled;
(4) state a deadline by which the settlement offer
must be accepted; and
(5) be served on the claimant to whom the settlement
offer is made.
(c) A defendant or group of defendants may not make a
settlement offer under this section before the 90th day after the
later of:
(1) the date any of the offering defendants filed a
responsive pleading; or
(2) the date any of the offering defendants otherwise
appeared in the action.
(d) A defendant or group of defendants may not make a
settlement offer under this section after the 30th day before the
date set for trial.
(e) The parties are not required to file a settlement offer
with the court.
Sec. 42.052. ACCEPTANCE OF SETTLEMENT OFFER. (a) A
claimant may accept a settlement offer made under this chapter on or
before 5 p.m. on the 30th day after the date the claimant received
the settlement offer or before the deadline stated in the
settlement offer, whichever is later.
(b) Acceptance of a settlement offer must be:
(1) in writing; and
(2) served on the defendant or defendants who made the
settlement offer.
Sec. 42.053. WITHDRAWING SETTLEMENT OFFER. (a) A
defendant or group of defendants may withdraw a settlement offer by
serving a written withdrawal on the claimant to whom the settlement
offer was made before the claimant accepts the settlement offer. A
claimant may not accept a settlement offer after it is withdrawn.
(b) If a settlement offer is withdrawn, the defendant or
group of defendants that made the settlement offer is not entitled
to recover litigation costs under this chapter.
Sec. 42.054. REJECTION OF SETTLEMENT OFFER. For purposes
of this chapter, a settlement offer is rejected if:
(1) the claimant to whom the settlement offer was made
rejects the settlement offer by serving a written rejection on any
defendant making the settlement offer; or
(2) the settlement offer is not withdrawn and is not
accepted before the deadline for accepting the offer.
Sec. 42.055. AWARD OF LITIGATION COSTS. (a) In determining
the amount of monetary relief to be awarded to a claimant in the
judgment under this section, the following are excluded:
(1) any litigation costs awarded under this chapter;
and
(2) any attorney's fees, expenses, and costs incurred
by the party to whom the offer was made after the date the offer is
rejected.
(b) Any defendant who makes a settlement offer under this
chapter to a claimant seeking monetary relief shall recover
litigation costs from the claimant if:
(1) the settlement offer is rejected;
(2) the amount of monetary relief to be awarded to the
claimant in the judgment is more favorable to the defendant or group
of defendants who made the settlement offer than the settlement
offer; and
(3) the difference between the amount of monetary
relief to be awarded to the claimant in the judgment and the amount
of the settlement offer is equal to or greater than 10 percent of
the amount of the settlement offer.
(c) Any defendant who makes a settlement offer to a claimant
seeking nonmonetary relief, other than injunctive relief, may
recover litigation costs from the claimant if:
(1) the settlement offer is rejected; and
(2) the judgment is more favorable to the defendant or
group of defendants who made the settlement offer than the
settlement offer.
(d) Litigation costs awarded to a defendant under this
section include only those litigation costs incurred by the
defendant who made a settlement offer after the rejection of the
earliest settlement offer that entitles the defendant to an award
of litigation costs under this section.
(e) Litigation costs awarded under this section shall:
(1) be awarded in the judgment; and
(2) offset the claimant's recovery against the
offering defendant.
(f) The court shall determine the amount of litigation costs
awarded based on written or oral evidence presented to the court.
In jury trials:
(1) the evidence must be presented outside the
presence of the jury; and
(2) the presentation of evidence may be made after the
jury has reached its verdict.
(g) The trial judge who presided over the trial of the case
shall act as the finder of fact in regard to the award of litigation
costs under this section. If that judge is unable to do so, the
local presiding judge shall appoint another judge to hear and
determine all issues related to the award.
(h) An award of litigation costs under this section may be
reviewed on appeal from a final judgment for abuse of discretion.
Sec. 42.056. LIMITATION ON LITIGATION COSTS. (a) The
amount of litigation costs awarded under this chapter shall not
exceed the claimant's total recovery in connection with the
transactions or occurrences giving rise to the claim.
(b) The claimant's total recovery under this section does
not include the proceeds of an insurance policy paid to the claimant
as a beneficiary of the policy, unless the proceeds are the subject
of the litigation.
(c) The claimant's total recovery under this section
includes:
(1) the amount of any monetary relief awarded to the
claimant in the judgment; and
(2) the amount of any money paid or to be paid to the
claimant by any person in consideration of actual or potential
liability in connection with the transactions or occurrences giving
rise to the claim.
(d) If litigation costs are awarded against a claimant under
this chapter, the claimant shall not be awarded any attorney's
fees, expenses, or costs to which the claimant would otherwise be
entitled under any other law that were incurred by the claimant
after the claimant's rejection of the earliest settlement offer
that entitles the defendant or group of defendants to an award of
litigation costs under this section.
Sec. 42.057. ADMISSIBILITY OF EVIDENCE. (a) This chapter
does not affect the admissibility or inadmissibility of evidence as
provided in the Texas Rules of Evidence.
(b) The provisions of this chapter may not be made known to
the jury through any means, including voir dire, introduction into
evidence, instruction, or argument.
SECTION 2.02. This article applies only to a civil action
described by Chapter 42, Civil Practice and Remedies Code, as added
by this article, commenced on or after the effective date of this
article. An action commenced before the effective date of this
article is governed by the law in effect immediately before the
change in law made by this article, and that law is continued in
effect for that purpose.
ARTICLE 3. VENUE; FORUM NON CONVENIENS
SECTION 3.01. Chapter 15, Civil Practice and Remedies Code,
is amended by adding Subchapter F to read as follows:
SUBCHAPTER F. TRANSFER OF PRETRIAL VENUE IN MULTIDISTRICT
LITIGATION
Sec. 15.151. PURPOSE. The purpose of this subchapter is to
facilitate the just and efficient resolution of litigation in the
courts of this state. To accomplish this purpose, this subchapter
shall be construed in harmony with federal judicial interpretation
of comparable federal multidistrict litigation statutes to the
extent consistent with this purpose.
Sec. 15.152. DEFINITIONS. In this subchapter:
(1) "Panel" means the judicial panel on multidistrict
litigation authorized by Subchapter H, Chapter 74, Government Code.
(2) "Related" means that cases involve common material
issues of fact.
Sec. 15.153. APPLICABILITY. (a) This subchapter applies
to any civil action, including any class action, that is one of
multiple related cases pending in the district courts of this
state.
(b) This subchapter does not apply to any action in which
this state is a complainant arising under the antitrust laws.
Sec. 15.154. TRANSFER FOR COORDINATED OR CONSOLIDATED
PRETRIAL PROCEEDINGS. The panel may transfer any case to which this
subchapter applies to any district court for the purpose of
allowing coordinated or consolidated pretrial proceedings in
related cases.
Sec. 15.155. INITIATION OF TRANSFER PROCEEDINGS. (a)
Proceedings to transfer a case under this subchapter may be
initiated by:
(1) the panel on its own initiative; or
(2) a motion filed with the panel by a party in a case
to which this subchapter applies.
(b) A motion filed under Subsection (a)(2) must state:
(1) the number and style of the case that is the
subject of the motion;
(2) the number and style of the related case or cases
with which coordinated or consolidated pretrial proceedings are
sought, and the court and county in which the related case or cases
are pending;
(3) the material questions of fact common to the
cases;
(4) the reasons why coordinated or consolidated
pretrial proceedings would promote the just and efficient conduct
of the cases; and
(5) whether the parties to the case that is the subject
of the motion agree to the motion.
(c) A copy of the motion shall be filed by the movant in each
case identified in Subsections (b)(1) and (2).
Sec. 15.156. DETERMINATION OF TRANSFER. (a) After notice
to all parties in all related cases that may be subject to
coordinated or consolidated pretrial proceedings, and a hearing,
the panel shall order the transfer of any or all related cases to
one or more district courts for coordinated or consolidated
pretrial proceedings if it determines that transfer:
(1) is for the convenience of parties and witnesses;
and
(2) will promote the just and efficient conduct of the
actions.
(b) Any party to any case that would be affected by the
proceedings under this subchapter may appear at the hearing and
offer evidence on the propriety of coordinated or consolidated
pretrial proceedings in the related cases.
(c) The panel's order directing or denying transfer must be
supported by findings of fact and conclusions of law.
Sec. 15.157. FILING OF PANEL ORDERS. (a) Any order of the
panel shall be filed by the panel in the district court in which the
transfer hearing is to be or has been held.
(b) A copy of an order directing or denying transfer of
related cases shall be sent by the panel to both the transferee and
transferor courts.
(c) An order directing the transfer of related cases for
coordinated or consolidated pretrial proceedings is effective when
filed in the district court in which the transfer hearing was held.
Sec. 15.158. REVIEW OF PANEL ORDERS. (a) Review of an
order of the panel is by extraordinary writ.
(b) A petition for an extraordinary writ to review an order
of the panel in regard to setting a transfer hearing, or to review
any other order of the panel made before the order either directing
or denying transfer is made, must be filed in the court of appeals
having jurisdiction over the district in which the transfer hearing
is to be or has been held.
(c) A petition for an extraordinary writ to review an order
directing the transfer of one or more related cases, or to review
any order made after the transfer order is made, must be filed in
the court of appeals having jurisdiction over the transferee
district.
(d) An order of the panel denying a motion to transfer for
coordinated or consolidated pretrial proceedings may not be
appealed or reviewed.
Sec. 15.159. ASSIGNMENT. (a) On request of the panel, a
district judge may be assigned to preside in the transferee
district over coordinated or consolidated pretrial proceedings
being conducted pursuant to this subchapter.
(b) The assignment may be made by the chief justice of the
supreme court or by the presiding judge of the administrative
judicial region in which the transferee court sits, in accordance
with Subchapter C, Chapter 74, Government Code.
Sec. 15.160. CONDUCT OF PROCEEDINGS. (a) The coordinated
or consolidated pretrial proceedings shall be conducted by the
judge or judges to whom the cases are assigned by the panel.
(b) When conducting pretrial proceedings in cases
coordinated or consolidated for pretrial proceedings, the judge or
judges to whom the cases are assigned, the members of the panel, and
other district judges designated when needed by the panel may
exercise the powers of a district judge in any district, including
deciding motions to transfer venue and motions for summary
judgment.
Sec. 15.161. REMAND. A court to which a case is transferred
under this subchapter shall remand the transferred case, at or
before the conclusion of pretrial proceedings, to the district
court from which it was transferred unless it has been terminated,
except that the court may separate any claim, cross-claim,
counterclaim, or third-party claim and remand the separated claim
before the remainder of the case is remanded.
SECTION 3.02. Chapter 74, Government Code, is amended by
adding Subchapter H to read as follows:
SUBCHAPTER H. JUDICIAL PANEL ON MULTIDISTRICT LITIGATION
Sec. 74.161. JUDICIAL PANEL. (a) The judicial panel on
multidistrict litigation consists of seven justices of the courts
of appeals designated from time to time by the chief justice of the
supreme court. Two panel members may not be from the same court of
appeals district.
(b) The concurrence of four members shall be necessary to
any action by the panel.
Sec. 74.162. OPERATION; RULES. (a) The judicial panel on
multidistrict litigation shall operate subject to rules of
administration for multidistrict litigation practice and procedure
adopted by the supreme court under Section 74.024.
(b) The panel may prescribe additional rules for the conduct
of its business not inconsistent with Subchapter F, Chapter 15,
Civil Practice and Remedies Code, and the rules of administration
for multidistrict litigation practice and procedure, as adopted by
the supreme court.
SECTION 3.03. Section 15.003, Civil Practice and Remedies
Code, is amended to read as follows:
Sec. 15.003. MULTIPLE PLAINTIFFS AND INTERVENING
PLAINTIFFS. (a) In a suit in which there is [where] more than one
plaintiff, whether the plaintiffs are included by joinder, by
intervention, because the lawsuit was begun by more than one
plaintiff, or otherwise, [is joined] each plaintiff must,
independently of every [any] other plaintiff, establish proper
venue. If a plaintiff cannot independently [Any person who is
unable to] establish proper venue, that plaintiff's part of the
suit, including all of that plaintiff's claims and causes of
action, must be transferred to a county of proper venue or
dismissed, as is appropriate, [may not join or maintain venue for
the suit as a plaintiff] unless that plaintiff [the person],
independently of every [any] other plaintiff, establishes that:
(1) joinder of that plaintiff or intervention in the
suit by that plaintiff is proper under the Texas Rules of Civil
Procedure;
(2) maintaining venue as to that plaintiff in the
county of suit does not unfairly prejudice another party to the
suit;
(3) there is an essential need to have that plaintiff's
[the person's] claim tried in the county in which the suit is
pending; and
(4) the county in which the suit is pending is a fair
and convenient venue for that plaintiff [the person seeking to join
in or maintain venue for the suit] and all [the] persons against
whom the suit is brought.
(b) An interlocutory appeal may be taken of a trial court's
determination under Subsection (a) that:
(1) a plaintiff did or did not independently establish
proper venue; or
(2) a plaintiff that did not independently establish
proper venue did or did not establish the items prescribed by
Subsections (a)(1)-(4) [A person may not intervene or join in a
pending suit as a plaintiff unless the person, independently of any
other plaintiff:
[(1) establishes proper venue for the county in which
the suit is pending; or
[(2) satisfies the requirements of Subdivisions (1)
through (4) of Subsection (a)].
(c) An [Any person seeking intervention or joinder, who is
unable to independently establish proper venue, or a party opposing
intervention or joinder of such a person may contest the decision of
the trial court allowing or denying intervention or joinder by
taking an] interlocutory appeal permitted by Subsection (b) must be
taken to the court of appeals district in which the trial court is
located under the procedures established for interlocutory
appeals. The appeal may be taken by a party that is affected by the
trial court's determination under Subsection (a). [The appeal must
be perfected not later than the 20th day after the date the trial
court signs the order denying or allowing the intervention or
joinder.] The court of appeals shall:
(1) determine whether the trial court's order [joinder
or intervention] is proper based on an independent determination
from the record and not under either an abuse of discretion or
substantial evidence standard; and
(2) render judgment [its decision] not later than the
120th day after the date the appeal is perfected [by the complaining
party].
(d) An interlocutory appeal under Subsection (b) has the
effect of staying the commencement of trial in the trial court
pending resolution of the appeal.
SECTION 3.04. Section 71.051, Civil Practice and Remedies
Code, is amended by amending Subsection (a) and adding Subsection
(j) to read as follows:
(a) If [With respect to a plaintiff who is not a legal
resident of the United States, if] a court of this state, on written
motion of a party, finds that in the interest of justice a claim or
action to which this section applies would be more properly heard in
a forum outside this state, the court shall [may] decline to
exercise jurisdiction under the doctrine of forum non conveniens
and shall [may] stay or dismiss the claim or action [in whole or in
part] on any conditions that may be just.
(j) This section does not affect the application of the
common law doctrine of forum non conveniens to actions other than
actions for personal injury or wrongful death.
SECTION 3.05. The following sections of the Civil Practice
and Remedies Code are repealed:
(1) 71.051(b), (c), (d), (e), (f), (g), and (h); and
(2) 71.052.
SECTION 3.06. (a) Sections 3.01 and 3.02 of this article
apply only to a suit commenced or pending on or after the effective
date of this article.
(b) Section 3.03 of this article applies only to a suit
commenced on or after the effective date of this article. A suit
commenced before the effective date of this article is governed by
the law in effect immediately before the change in law made by
Section 3.03 of this article, and that law is continued in effect
for that purpose.
(c) Sections 3.04 and 3.05 of this article apply only to a
suit commenced on or after the effective date of this article or
pending on the effective date of this article and in which the
trial, or any new trial or retrial following motion, appeal, or
otherwise, begins on or after that date. In a suit commenced before
the effective date of this article, a trial, new trial, or retrial
that is in progress on that date is governed with respect to the
subject matter of Sections 3.04 and 3.05 of this article by the
applicable law in effect immediately before that date, and that law
is continued in effect for that purpose.
ARTICLE 4. PROPORTIONATE RESPONSIBILITY AND
DESIGNATION OF RESPONSIBLE PARTIES
SECTION 4.01. Section 33.002(a), Civil Practice and
Remedies Code, is amended to read as follows:
(a) This [Except as provided by Subsections (b) and (c),
this] chapter applies to:
(1) any cause of action based on tort in which a
defendant, settling person, or responsible third party is found
responsible for a percentage of the harm for which relief is sought;
or
(2) any action brought under the Deceptive Trade
Practices-Consumer Protection Act (Subchapter E, Chapter 17,
Business & Commerce Code) in which a defendant, settling person, or
responsible third party is found responsible for a percentage of
the harm for which relief is sought.
SECTION 4.02. Section 33.003, Civil Practice and Remedies
Code, is amended to read as follows:
Sec. 33.003. DETERMINATION OF PERCENTAGE OF
RESPONSIBILITY. (a) The trier of fact, as to each cause of action
asserted, shall determine the percentage of responsibility, stated
in whole numbers, for the following persons with respect to each
person's causing or contributing to cause in any way the harm for
which recovery of damages is sought, whether by negligent act or
omission, by any defective or unreasonably dangerous product, by
other conduct or activity that violates an applicable legal
standard, or by any combination of these:
(1) each claimant;
(2) each defendant;
(3) each settling person; and
(4) each responsible third party who has been
designated [joined] under Section 33.004.
(b) This section does not require a submission to the jury
of a question regarding conduct by any person without sufficient
evidence to support the submission.
SECTION 4.03. The heading to Section 33.004, Civil Practice
and Remedies Code, is amended to read as follows:
Sec. 33.004. DESIGNATION [JOINDER] OF RESPONSIBLE THIRD
PARTY [PARTIES].
SECTION 4.04. Section 33.004, Civil Practice and Remedies
Code, is amended by amending Subsections (a) and (b) and adding
Subsections (f)-(j) to read as follows:
(a) A [Except as provided in Subsections (d) and (e), prior
to the expiration of limitations on the claimant's claim for
damages against the defendant and on timely motion made for that
purpose, a] defendant may seek to designate a person as [join] a
responsible third party by filing a motion for leave to designate
that person as a responsible third party [who has not been sued by
the claimant]. The motion must be filed on or before the 60th day
before the trial date unless the court finds good cause to allow the
motion to be filed at a later date.
(b) Nothing in this section affects [shall affect] the
third-party practice as previously recognized in the rules and
statutes of this state with regard to the assertion by a defendant
of rights to contribution or indemnity. Nothing in this section
affects [shall affect] the filing of cross-claims or counterclaims.
(f) A court shall grant leave to designate the named person
as a responsible third party unless another party files an
objection to the motion for leave on or before the 15th day after
the date the motion is served.
(g) If an objection to the motion for leave is timely filed,
the court shall grant leave to designate the person as a responsible
third party unless the objecting party establishes:
(1) the defendant did not plead sufficient facts
concerning the alleged liability of the responsible person to
satisfy the pleading requirements of the Texas Rules of Civil
Procedure; and
(2) after having been granted leave to replead, the
defendant failed to plead sufficient facts concerning the alleged
liability of the responsible person to satisfy the pleading
requirements of the Texas Rules of Civil Procedure.
(h) By granting a motion for leave to designate a person as a
responsible third party, the person named in the motion is
designated as a responsible third party for purposes of this
chapter without further action by the court or any party.
(i) For a person whose identity is not known, the court
shall grant a motion for leave to designate that person as a
responsible third party if the court determines that the motion
otherwise should be granted under Subsection (f) or (g) and the
defendant has stated in the motion all known identifying
characteristics of the person. In that circumstance, the person
will be denominated as "Jane Doe" or "John Doe" until the person's
identity is known.
(j) The filing or granting of a motion for leave to
designate a person as a responsible third party or a finding of
fault against the person:
(1) does not by itself impose liability on the person;
and
(2) may not be used in any other proceeding, on the
basis of res judicata, collateral estoppel, or any other legal
theory, to impose liability on the person.
SECTION 4.05. Sections 33.011(1), (2), (5), and (6), Civil
Practice and Remedies Code, are amended to read as follows:
(1) "Claimant" means a person [party] seeking recovery
of damages [pursuant to the provisions of Section 33.001],
including a plaintiff, counterclaimant, cross-claimant, or
third-party plaintiff [seeking recovery of damages]. In an action
in which a party seeks recovery of damages for injury to another
person, damage to the property of another person, death of another
person, or other harm to another person, "claimant" includes:
(A) the person who was injured, was harmed, or
died or whose property was damaged; and
(B) any person who is [both that other person and
the party] seeking, has sought, or could seek recovery of damages
for the injury, harm, or death of that person or for the damage to
the property of that person [pursuant to the provisions of Section
33.001].
(2) "Defendant" includes any person [party] from whom,
at the time of the submission of the case to the trier of fact, a
claimant seeks recovery of damages [pursuant to the provisions of
Section 33.001 at the time of the submission of the case to the
trier of fact].
(5) "Settling person" means a person who [at the time
of submission] has, at any time, paid or promised to pay money or
anything of monetary value to a claimant [at any time] in
consideration of potential liability [pursuant to the provisions of
Section 33.001] with respect to the personal injury, property
damage, death, or other harm for which recovery of damages is
sought.
(6) [(A)] "Responsible third party" means any person
who is alleged to have caused or contributed to causing in any way
the harm for which recovery of damages is sought, whether by
negligent act or omission, by any defective or unreasonably
dangerous product, by other conduct or activity that violates an
applicable legal standard, or by any combination of these. [to whom
all of the following apply:
[(i) the court in which the action was filed
could exercise jurisdiction over the person;
[(ii) the person could have been, but was
not, sued by the claimant; and
[(iii) the person is or may be liable to the
plaintiff for all or a part of the damages claimed against the named
defendant or defendants.
[(B)] The term "responsible third party" does not
include a seller eligible for indemnity under Section 82.002[:
[(i) the claimant's employer, if the
employer maintained workers' compensation insurance coverage, as
defined by Section 401.011(44), Labor Code, at the time of the act,
event, or occurrence made the basis of the claimant's suit; or
[(ii) a person or entity that is a debtor in
bankruptcy proceedings or a person or entity against whom this
claimant's claim has been discharged in bankruptcy, except to the
extent that liability insurance or other source of third party
funding may be available to pay claims asserted against the
debtor].
SECTION 4.06. Section 33.012(b), Civil Practice and
Remedies Code, is amended to read as follows:
(b) If the claimant has settled with one or more persons,
the court shall further reduce the amount of damages to be recovered
by the claimant with respect to a cause of action by a credit equal
to one of the following, as elected in accordance with Section
33.014:
(1) the sum of the dollar amounts of all settlements;
or
(2) a percentage equal to each settling person's
percentage of responsibility [dollar amount equal to the sum of the
following percentages of damages found by the trier of fact:
[(A) 5 percent of those damages up to $200,000;
[(B) 10 percent of those damages from $200,001 to
$400,000;
[(C) 15 percent of those damages from $400,001 to
$500,000; and
[(D) 20 percent of those damages greater than
$500,000].
SECTION 4.07. Section 33.013, Civil Practice and Remedies
Code, is amended by amending Subsections (a) and (b) and adding
Subsections (e) and (f) to read as follows:
(a) Except as provided in Subsection [Subsections] (b) [and
(c)], a liable defendant is liable to a claimant only for the
percentage of the damages found by the trier of fact equal to that
defendant's percentage of responsibility with respect to the
personal injury, property damage, death, or other harm for which
the damages are allowed.
(b) Notwithstanding Subsection (a), each liable defendant
is, in addition to his liability under Subsection (a), jointly and
severally liable for the damages recoverable by the claimant under
Section 33.012 with respect to a cause of action if:
(1) the percentage of responsibility attributed to the
defendant with respect to a cause of action is greater than 50
percent; or
(2) the defendant, with the specific intent to do harm
to others, acted in concert with another person to engage in the
conduct described in the following provisions of the Penal Code and
in so doing proximately caused the damages legally recoverable by
the claimant:
(A) Section 19.02 (murder);
(B) Section 19.03 (capital murder);
(C) Section 20.04 (aggravated kidnapping);
(D) Section 22.02 (aggravated assault);
(E) Section 22.011 (sexual assault);
(F) Section 22.021 (aggravated sexual assault);
(G) Section 22.04 (injury to a child, elderly
individual, or disabled individual);
(H) Section 32.21 (forgery);
(I) Section 32.43 (commercial bribery);
(J) Section 32.45 (misapplication of fiduciary
property or property of financial institution);
(K) Section 32.46 (securing execution of
document by deception);
(L) Section 32.47 (fraudulent destruction,
removal, or concealment of writing); or
(M) conduct described in Chapter 31 the
punishment level for which is a felony of the third degree or
higher.
(e) Notwithstanding anything to the contrary stated in the
provisions of the Penal Code listed in Subsection (b)(2), that
subsection applies only if the claimant proves the defendant acted
or failed to act with specific intent to do harm. A defendant acts
with specific intent to do harm with respect to the nature of the
defendant's conduct and the result of the person's conduct when it
is the person's conscious effort or desire to engage in the conduct
for the purpose of doing substantial harm to others.
(f) The jury may not be made aware through voir dire,
introduction into evidence, instruction, or any other means that
the conduct to which Subsection (b)(2) refers is defined by the
Penal Code.
SECTION 4.08. Section 33.014, Civil Practice and Remedies
Code, is amended to read as follows:
Sec. 33.014. ELECTION OF CREDIT FOR SETTLEMENTS. If a
claimant has settled with one or more persons, an election must be
made as to which [dollar] credit is to be applied under Section
33.012(b). This election shall be made by [any defendant] filing a
written election before the issues of the action are submitted to
the trier of fact [and, when made, shall be binding on all
defendants]. If a defendant does not make an election, that
defendant is [no defendant makes this election or if conflicting
elections are made, all defendants are] considered to have elected
Subdivision (2) of Section 33.012(b).
SECTION 4.09. Section 33.017, Civil Practice and Remedies
Code, is amended to read as follows:
Sec. 33.017. PRESERVATION OF EXISTING RIGHTS OF INDEMNITY.
Nothing in this chapter shall be construed to affect any rights of
indemnity granted by [to a seller eligible for indemnity by Chapter
82, the Texas Motor Vehicle Commission Code (Article 4413(36),
Vernon's Texas Civil Statutes), or] any [other] statute, [nor shall
it affect rights of indemnity granted] by contract, or by [at]
common law. To the extent of any conflict between this chapter and
any right to indemnification granted by [Section 82.002, the Texas
Motor Vehicle Commission Code (Article 4413(36), Vernon's Texas
Civil Statutes), or any other] statute, contract, or common law,
those rights of indemnification shall prevail over the provisions
of this chapter.
SECTION 4.10. Section 417.001(b), Labor Code, is amended to
read as follows:
(b) If a benefit is claimed by an injured employee or a legal
beneficiary of the employee, the insurance carrier is subrogated to
the rights of the injured employee and may enforce the liability of
the third party in the name of the injured employee or the legal
beneficiary. The insurance carrier's subrogation interest is
limited to the amount of the total benefits paid or assumed by the
carrier to the employee or the legal beneficiary, less the amount by
which the court reduces the judgment based on the percentage of
responsibility determined by the trier of fact under Section
33.003, Civil Practice and Remedies Code, attributable to the
employer. If the recovery is for an amount greater than the amount
of the insurance carrier's subrogation interest [that paid or
assumed by the insurance carrier to the employee or the legal
beneficiary], the insurance carrier shall:
(1) reimburse itself and pay the costs from the amount
recovered; and
(2) pay the remainder of the amount recovered to the
injured employee or the legal beneficiary.
SECTION 4.11. The following sections of the Civil Practice
and Remedies Code are repealed:
(1) 33.002(b), (d), (e), (f), (g), and (h);
(2) 33.004(c), (d), and (e);
(3) 33.011(7);
(4) 33.012(c); and
(5) 33.013(c).
SECTION 4.12. (a) Except as provided by Subsection (b) of
this section, this article applies only to a suit commenced or
pending on or after the effective date of this article.
(b) This article does not apply to a suit in which the trial
on the merits commenced on or before the effective date of this
article; that suit is governed by the law in effect immediately
before the change in law made by this article, and that law is
continued in effect for that purpose.
ARTICLE 5. PRODUCTS LIABILITY
SECTION 5.01. Section 16.012, Civil Practice and Remedies
Code, is amended to read as follows:
Sec. 16.012. PRODUCTS LIABILITY[: MANUFACTURING
EQUIPMENT]. (a) In this section:
(1) "Claimant," ["products liability action,"]
"seller," and "manufacturer" have the meanings assigned by Section
82.001.
(2) "Products liability action" means any action
against a manufacturer or seller relating to an alleged defective
product, whether the action is based in strict tort liability,
strict products liability, negligence, misrepresentation, breach
of express or implied warranty, or any other theory or combination
of theories, and whether the relief sought is the recovery of
damages or to obtain any other legal or equitable relief, including
a suit for:
(A) injury, damage, or loss to real or personal
property;
(B) personal injury;
(C) wrongful death;
(D) economic loss; or
(E) declaratory, injunctive, or other equitable
relief. ["Manufacturing equipment" means equipment and machinery
used in the manufacturing, processing, or fabrication of tangible
personal property but does not include agricultural equipment or
machinery.]
(b) Except as provided by Subsection (c), a claimant must
commence a products liability action against a manufacturer or
seller of a product [manufacturing equipment] before the end of 15
years after the date of the sale of the product [equipment] by the
defendant.
(c) If a manufacturer or seller expressly warrants in
writing [represents] that the product [manufacturing equipment]
has a useful safe life of longer than 15 years, a claimant must
commence a products liability action against that manufacturer or
seller of the product [equipment] before the end of the number of
years warranted [represented] after the date of the sale of the
product [equipment] by that seller.
[(d) This section does not reduce a limitations period that
applies to a products liability action involving manufacturing
equipment that accrues before the end of the limitations period
under this section.]
(e) This section does not extend the limitations period
within which a products liability action involving the product
[manufacturing equipment] may be commenced under any other law.
(f) This section applies only to the sale and not to the
lease of a product [manufacturing equipment].
SECTION 5.02. Chapter 82, Civil Practice and Remedies Code,
is amended by adding Sections 82.003, 82.007, 82.008, and 82.009 to
read as follows:
Sec. 82.003. LIABILITY OF NONMANUFACTURING SELLERS. A
seller that did not manufacture a product is not liable for harm
caused to the claimant by that product unless the claimant proves:
(1) that the seller altered or modified the product
and the claimant's harm resulted from that alteration or
modification;
(2) that:
(A) the seller exercised substantial control
over the content of a warning or instruction that accompanied the
product;
(B) the warning or instruction was inadequate;
and
(C) the claimant's harm resulted from the
inadequacy of the warning or instruction;
(3) that:
(A) the seller made an express factual
representation about an aspect of the product;
(B) the representation was incorrect;
(C) the claimant relied on the representation in
obtaining or using the product; and
(D) if the aspect of the product had been as
represented, the claimant would not have been harmed by the product
or would not have suffered the same degree of harm; or
(4) that:
(A) the seller actually knew of a defect to the
product at the time the seller supplied the product; and
(B) the claimant's harm resulted from the defect.
Sec. 82.007. MEDICINES. In a products liability action
alleging that an injury was caused by a failure to provide adequate
warnings or information with regard to a pharmaceutical product,
the defendant or defendants, including a health care provider,
manufacturer, distributor, and prescriber, are not liable with
respect to the allegations if:
(1) the warnings or information that accompanied the
product in its distribution were those required by the United
States Food and Drug Administration for a product approved under
the Federal Food, Drug, and Cosmetic Act (21 U.S.C. Section 301 et
seq.), as amended, or Section 351, Public Health Service Act (42
U.S.C. Section 262), as amended; or
(2) the warnings provided were those stated in
monographs developed by the United States Food and Drug
Administration for pharmaceutical products that may be distributed
without an approved new drug application.
Sec. 82.008. EVIDENCE OF SUBSEQUENT IMPROVEMENTS AND
MEASURES. In a products liability action, a court may not admit,
except for purposes of impeachment, evidence of a subsequent
improvement made or measure taken with respect to the defect
alleged to have caused harm, or a similar product, that, if made or
taken before the product was supplied, would have made the
claimant's harm less likely.
Sec. 82.009. COMPLIANCE WITH GOVERNMENT STANDARDS. (a) A
product manufacturer, distributor, or seller is not liable for any
injury to a claimant allegedly caused by some aspect of the
formulation, labeling, or design of a product if the product
manufacturer, distributor, or seller proves by a preponderance of
the evidence that the product's formula, labeling, or design
complied with mandatory safety standards or regulations adopted and
promulgated by the state or federal government, or an agency of the
state or federal government, that were applicable to the product at
the time of manufacture, and that governed the product risk that
caused harm, unless the claimant proves by clear and convincing
evidence that the mandatory state or federal safety standards or
regulations applicable to the product were grossly inadequate to
protect the public from unreasonable risks of injury or damage.
(b) A product manufacturer, distributor, or seller is not
liable for any injury to a claimant allegedly caused by some aspect
of the formulation, labeling, or design of a product if the product
manufacturer, distributor, or seller proves by a preponderance of
the evidence that the product was subject to premarket licensing or
approval by an agency of the state or federal government, that the
manufacturer complied with all of the agency's procedures and
requirements with respect to premarket licensing or approval, and
that after full consideration of the product's risks and benefits
the product was approved or licensed for sale by the agency, unless
the claimant proves by clear and convincing evidence that:
(1) the standards or procedures used in the particular
premarket approval or licensing process were grossly inadequate to
protect the public from unreasonable risks of injury or damage; or
(2) the manufacturer, before or after premarket
approval or licensing of the product, withheld from or
misrepresented to the agency required information that was material
and relevant to the performance of the product and was causally
related to the claimant's injury.
(c) This section does not extend to manufacturing flaws or
defects even though the product manufacturer has complied with all
quality control and manufacturing practices mandated by the agency.
SECTION 5.03. (a) Section 5.01 of this article applies only
to a suit commenced on or after the effective date of this article.
A suit commenced before the effective date of this article is
governed by the law in effect immediately before the change in law
made by Section 5.01 of this article, and that law is continued in
effect for that purpose.
(b) Section 5.02 of this article applies only to a suit
commenced on or after the effective date of this article or pending
on the effective date of this article and in which the trial, or any
new trial or retrial following motion, appeal, or otherwise, begins
on or after that date. In a suit commenced before the effective
date of this article, a trial, new trial, or retrial that is in
progress on that date is governed with respect to the subject matter
of Section 5.02 of this article by the applicable law in effect
immediately before that date, and that law is continued in effect
for that purpose.
ARTICLE 6. INTEREST
SECTION 6.01. Section 304.003(c), Finance Code, is amended
to read as follows:
(c) The postjudgment interest rate is:
(1) the weekly average one-year constant maturity
treasury yield [auction rate quoted on a discount basis for 52-week
treasury bills issued by the United States government] as most
recently published by the Board of Governors of the Federal Reserve
System [Federal Reserve Board] before the date of computation;
(2) five [10] percent a year if the weekly average
one-year constant maturity treasury yield [auction rate] described
by Subdivision (1) is less than five [10] percent; or
(3) 15 [20] percent a year if the weekly average
one-year constant maturity treasury yield [auction rate] described
by Subdivision (1) is more than 15 [20] percent.
SECTION 6.02. Subchapter B, Chapter 304, Finance Code, is
amended by adding Section 304.1045 to read as follows:
Sec. 304.1045. FUTURE DAMAGES. Prejudgment interest may
not be assessed or recovered on an award of future damages.
SECTION 6.03. This article applies only to a suit in which a
judgment is signed on or after the effective date of this article,
without regard to whether the suit commenced before, on, or after
that date.
ARTICLE 7. APPEAL BONDS
SECTION 7.01. Section 35.006, Civil Practice and Remedies
Code, is amended to read as follows:
Sec. 35.006. STAY. (a) If the judgment debtor shows the
court that an appeal from the foreign judgment is pending or will be
taken, that the time for taking an appeal has not expired, or that a
stay of execution has been granted, has been requested, or will be
requested, and proves that the judgment debtor has furnished or
will furnish the security for the satisfaction of the judgment
required by the state in which it was rendered, the court shall stay
enforcement of the foreign judgment until the appeal is concluded,
the time for appeal expires, or the stay of execution expires or is
vacated.
(b) If the judgment debtor shows the court a ground on which
enforcement of a judgment of the court of this state would be
stayed, the court shall stay enforcement of the foreign judgment
for an appropriate period and require the same security for
suspending enforcement [satisfaction] of the judgment that is
required in this state in accordance with Section 52.006.
SECTION 7.02. Chapter 52, Civil Practice and Remedies Code,
is amended by adding Section 52.006 to read as follows:
Sec. 52.006. AMOUNT OF SECURITY FOR MONEY JUDGMENT. (a)
Subject to Subsection (b), when a judgment is for money, the amount
of security must equal the sum of:
(1) the amount of compensatory damages awarded in the
judgment;
(2) interest for the estimated duration of the appeal;
and
(3) costs awarded in the judgement.
(b) Notwithstanding any other law or rule of court, when a
judgment is for money, the amount of security must not exceed the
lesser of:
(1) 50 percent of the judgment debtor's net worth; or
(2) $25 million.
(c) On a showing by the judgment debtor that the judgment
debtor is likely to suffer substantial economic harm if required to
post security in an amount required under Subsection (a) or (b), the
trial court shall lower the amount of the security to an amount that
will not cause the judgment debtor substantial economic harm.
(d) An appellate court may review the amount of security as
allowed under Rule 24, Texas Rules of Appellate Procedure, except
that when a judgment is for money, the appellate court may not
modify the amount of security to exceed the amount allowed under
this section.
SECTION 7.03. The following sections of the Civil Practice
and Remedies Code are repealed:
(1) 52.002;
(2) 52.003; and
(3) 52.004.
SECTION 7.04. This article applies only to a suit in which a
judgment is signed on or after the effective date of this article,
without regard to whether the suit commenced before, on, or after
that date.
ARTICLE 8. EVIDENCE RELATING TO SEAT BELTS
SECTION 8.01. Section 545.413(g), Transportation Code, is
repealed.
SECTION 8.02. (a) Except as provided by Subsection (b) of
this section, this article applies only to a suit commenced or
pending on or after the effective date of this article.
(b) This article does not apply to a suit in which the trial
on the merits commenced on or before the effective date of this
article.
ARTICLE 9. RESERVED
ARTICLE 10. HEALTH CARE
SECTION 10.01. Section 1.03(a), Medical Liability and
Insurance Improvement Act of Texas (Article 4590i, Vernon's Texas
Civil Statutes), is amended by amending Subdivisions (3), (4), and
(8) and adding Subdivisions (10)-(22) to read as follows:
(3)(A) "Health care provider" means any person,
partnership, professional association, corporation, facility, or
institution duly licensed, certified, registered, or chartered by
the State of Texas to provide health care, including:
(i) [as] a registered nurse;
(ii) a [,] hospital;
(iii) a nonprofit hospital system;
(iv) a [,] dentist;
(v) a hospice;
(vi) a [,] podiatrist;
(vii) a [,] pharmacist;
(viii) an emergency medical services
provider;
(ix) an assisted living facility;
(x) a home and community support services
agency;
(xi) an intermediate care facility for the
mentally retarded or a home and community-based services waiver
program for persons with mental retardation adopted in accordance
with Section 1915(c) of the federal Social Security Act (42 U.S.C.
Section 1396n(c)), as amended; [,] or
(xii) a nursing home.
(B) The term includes:
(i) [, or] an officer, director,
shareholder, member, partner, manager, owner, or affiliate of a
health care provider or physician; and
(ii) an employee, independent contractor,
or agent of a health care provider or physician [thereof] acting in
the course and scope of the [his] employment or contractual
relationship.
(4) "Health care liability claim" means a cause of
action against a health care provider or physician arising out of or
related to [for] treatment, lack of treatment, or other claimed
departure from accepted standards of medical care, [or] health
care, or safety or professional or administrative services practice
or procedure which proximately results in injury to or death of a
claimant [the patient], whether the claimant's [patient's] claim or
cause of action sounds in tort or contract.
(8) "Physician" means:
(A) an individual [a person] licensed to practice
medicine in this state;
(B) a professional association organized under
the Texas Professional Association Act (Article 1528f, Vernon's
Texas Civil Statutes) by an individual physician or group of
physicians;
(C) a partnership or limited liability
partnership formed by a group of physicians;
(D) a nonprofit health corporation certified
under Section 162.001, Occupations Code; or
(E) a company formed by a group of physicians
under the Texas Limited Liability Company Act (Article 1528n,
Vernon's Texas Civil Statutes).
(10) "Affiliate" means a person who directly or
indirectly, through one or more intermediaries, controls, is
controlled by, or is under common control with a specified person,
including any direct or indirect parent or subsidiary.
(11) "Claimant" means a person, including a decedent's
estate, seeking or who has sought recovery of damages in a health
care liability claim. All persons claiming to have sustained
damages as the result of the bodily injury or death of a single
person are considered a single claimant.
(12) "Control" means the possession, directly or
indirectly, of the power to direct or cause the direction of the
management and policies of the person, whether through ownership of
equity or securities, by contract, or otherwise.
(13) "Economic damages" means compensatory damages
for any pecuniary loss or damage. The term does not include
noneconomic damages.
(14) "Emergency medical care" means bona fide
emergency services provided after the sudden onset of a medical or
traumatic condition manifesting itself by acute symptoms of
sufficient severity, including severe pain, such that the absence
of immediate medical attention could reasonably be expected to
result in:
(A) placing the patient's health in serious
jeopardy;
(B) serious impairment to bodily functions; or
(C) serious dysfunction of any bodily organ or
part.
(15) "Emergency medical services provider" means a
licensed public or private provider to which Chapter 773, Health
and Safety Code, applies.
(16) "Home and community support services agency"
means a licensed public or provider agency to which Chapter 142,
Health and Safety Code, applies.
(17) "Intermediate care facility for the mentally
retarded" means a licensed public or private institution to which
Chapter 252, Health and Safety Code, applies.
(18) "Noneconomic damages" means any loss or damage,
however characterized, for past, present, and future physical pain
and suffering, mental anguish and suffering, loss of consortium,
loss of companionship and society, disfigurement, physical
impairment, and any other nonpecuniary loss or damage or element of
loss or damage.
(19) "Nursing home" means a licensed public or private
institution to which Chapter 242, Health and Safety Code, applies.
(20) "Professional or administrative services" means
those duties or services that a physician or health care provider is
required to provide as a condition of maintaining the physician's
or health care provider's license, accreditation status, or
certification to participate in state or federal health care
programs.
(21) "Hospice" means a hospice facility or activity to
which Chapter 142, Health and Safety Code, applies.
(22) "Hospital system" means a system of local
nonprofit hospitals and nonprofit entities created by the hospital
or its parent entity to further the charitable purposes of the
hospital under the common governance of a single corporate parent
that are located within a radius of not more than 125 linear miles
from the corporate parent.
SECTION 10.02. Subchapter A, Medical Liability and
Insurance Improvement Act of Texas (Article 4590i, Vernon's Texas
Civil Statutes), is amended by adding Section 1.04 to read as
follows:
Sec. 1.04. CONFLICT WITH OTHER LAW AND RULES OF CIVIL
PROCEDURE. (a) In the event of a conflict between this Act and
another law, including a rule of procedure or evidence or court
rule, this Act controls to the extent of the conflict.
(b) Notwithstanding Section 22.004, Government Code, and
except as otherwise provided by this Act, the supreme court may not
amend or adopt rules in conflict with this Act.
(c) The district courts and statutory county courts in a
county may not adopt local rules in conflict with this Act.
SECTION 10.03. Section 4.01, Medical Liability and
Insurance Improvement Act of Texas (Article 4590i, Vernon's Texas
Civil Statutes), is amended by adding Subsection (f) to read as
follows:
(f) Notwithstanding the provisions of Rule 202, Texas Rules
of Civil Procedure, a deposition may not be taken of a physician or
health care provider for the purpose of investigating a health care
liability claim before the filing of a lawsuit.
SECTION 10.04. The heading to Subchapter G, Medical
Liability and Insurance Improvement Act of Texas (Article 4590i,
Vernon's Texas Civil Statutes), is amended to read as follows:
SUBCHAPTER G. EVIDENTIARY MATTERS [RES IPSA LOQUITUR]
SECTION 10.05. Subchapter G, Medical Liability and
Insurance Improvement Act of Texas (Article 4590i, Vernon's Texas
Civil Statutes), is amended by adding Sections 7.03 and 7.04 to read
as follows:
Sec. 7.03. FEDERAL OR STATE INCOME TAXES. (a)
Notwithstanding any other law, in a health care liability claim, if
any claimant seeks recovery for loss of earnings, loss of earning
capacity, loss of contributions of a pecuniary value, or loss of
inheritance, evidence to prove the loss must be presented in the
form of a net after-tax loss that either was or should have been
paid by the injured party or decedent through which the alleged loss
has occurred.
(b) In a health care liability claim, if any claimant seeks
recovery for loss of earnings, loss of earning capacity, loss of
contributions of a pecuniary value, or loss of inheritance, the
court shall instruct the jury whether any recovery for compensatory
damages sought by the claimant is subject to federal or state income
taxes.
Sec. 7.04. JURY INSTRUCTIONS IN CASES INVOLVING EMERGENCY
MEDICAL CARE. (a) In a health care liability claim that involves a
claim of negligence arising from the provision of emergency medical
care, the court shall instruct the jury to consider, together with
all other relevant matters:
(1) whether the person providing care did not have the
patient's medical history or was unable to obtain a full medical
history, including the knowledge of preexisting medical
conditions, allergies, and medications;
(2) the lack of a preexisting physician-patient
relationship or health care provider-patient relationship;
(3) the circumstances constituting the emergency; and
(4) the circumstances surrounding the delivery of the
emergency medical care.
(b) The provisions of Subsection (a) of this section do not
apply to medical care or treatment:
(1) that occurs after the patient is stabilized and is
capable of receiving medical treatment as a nonemergency patient;
or
(2) that is unrelated to the original medical
emergency.
SECTION 10.06. The heading to Subchapter I, Medical
Liability and Insurance Improvement Act of Texas (Article 4590i,
Vernon's Texas Civil Statutes), is amended to read as follows:
SUBCHAPTER I. PAYMENT OF MEDICAL OR HEALTH CARE EXPENSES [ADVANCE
PAYMENTS]
SECTION 10.07. Subchapter I, Medical Liability and
Insurance Improvement Act of Texas (Article 4590i, Vernon's Texas
Civil Statutes), is amended by adding Section 9.01 to read as
follows:
Sec. 9.01. RECOVERY OF MEDICAL OR HEALTH CARE EXPENSES.
Recovery of medical or health care expenses in a health care
liability claim shall be limited to the amount actually paid or
incurred by or on behalf of the claimant.
SECTION 10.08. Section 10.01, Medical Liability and
Insurance Improvement Act of Texas (Article 4590i, Vernon's Texas
Civil Statutes), is amended to read as follows:
Sec. 10.01. LIMITATION ON HEALTH CARE LIABILITY CLAIMS.
(a) Notwithstanding any other law and subject to Subsection (b) of
this section, no health care liability claim may be commenced
unless the action is filed within two years from the occurrence of
the breach or tort or from the date the medical or health care
treatment that is the subject of the claim or the hospitalization
for which the claim is made is completed; provided that, minors
under the age of 12 years shall have until their 14th birthday in
which to file, or have filed on their behalf, the claim. Except as
herein provided, this subchapter applies to all persons regardless
of minority or other legal disability.
(b) A claimant must bring a health care liability claim not
later than 10 years after the date of the act or omission that gives
rise to the claim. This subsection is intended as a statute of
repose so that all claims must be brought within 10 years or they
are time barred.
SECTION 10.09. Section 11.02, Medical Liability and
Insurance Improvement Act of Texas (Article 4590i, Vernon's Texas
Civil Statutes), is amended by adding Subsections (e) and (f) to
read as follows:
(e) The limitation on health care liability claims
contained in Subsection (a) of this section includes punitive
damages.
(f) The limitation on health care liability claims
contained in Subsection (a) of this section shall be applied on a
per-claimant basis.
SECTION 10.10. Section 11.03, Medical Liability and
Insurance Improvement Act of Texas (Article 4590i, Vernon's Texas
Civil Statutes), is amended to read as follows:
Sec. 11.03. LIMITATION ON NONECONOMIC DAMAGES [ALTERNATIVE
PARTIAL LIMIT ON CIVIL LIABILITY]. [In the event that Section
11.02(a) of this subchapter is stricken from this subchapter or is
otherwise invalidated by a method other than through legislative
means, the following shall become effective:]
In an action on a health care liability claim where final
judgment is rendered against a physician or health care provider,
the limit of civil liability for noneconomic damages of the
physician or health care provider shall be limited to an amount not
to exceed $250,000 for each claimant, regardless of the number of
defendant physicians or health care providers against whom the
claim is asserted or the number of separate causes of action on
which the claim is based [of the physician or health care provider
for all past and future noneconomic losses recoverable by or on
behalf of any injured person and/or the estate of such person,
including without limitation as applicable past and future physical
pain and suffering, mental anguish and suffering, consortium,
disfigurement, and any other nonpecuniary damage, shall be limited
to an amount not to exceed $150,000].
SECTION 10.11. Subchapter K, Medical Liability and
Insurance Improvement Act of Texas (Article 4590i, Vernon's Texas
Civil Statutes), is amended by adding Section 11.031 to read as
follows:
Sec. 11.031. ALTERNATIVE LIMITATION ON NONECONOMIC
DAMAGES. (a) In the event that Section 11.03 of this subchapter is
stricken from this subchapter or is otherwise to any extent
invalidated by a method other than through legislative means, the
following, subject to the provisions of this section, shall become
effective:
In an action on a health care liability claim where final
judgment is rendered against a physician or health care provider,
the limit of civil liability for all damages and losses, other than
economic damages, shall be limited to an amount not to exceed
$250,000 for each claimant, regardless of the number of defendant
physicians or health care providers against whom the claim is
asserted or the number of separate causes of action on which the
claim is based.
(b) Effective before September 1, 2005, Subsection (a) of
this section applies to any physician or health care provider that
provides evidence of financial responsibility in the following
amounts in effect for any act or omission to which this subchapter
applies:
(1) at least $100,000 for each health care liability
claim and at least $300,000 in aggregate for all health care
liability claims occurring in an insurance policy year, calendar
year, or fiscal year for a physician participating in an approved
residency program;
(2) at least $200,000 for each health care liability
claim and at least $600,000 in aggregate for all health care
liability claims occurring in an insurance policy year, calendar
year, or fiscal year for a physician or health care provider, other
than a hospital; and
(3) at least $500,000 for each health care liability
claim and at least $1.5 million in aggregate for all health care
liability claims occurring in an insurance policy year, calendar
year, or fiscal year for a hospital.
(c) Effective September 1, 2005, Subsection (a) of this
section applies to any physician or health care provider that
provides evidence of financial responsibility in the following
amounts in effect for any act or omission to which this subchapter
applies:
(1) at least $100,000 for each health care liability
claim and at least $300,000 in aggregate for all health care
liability claims occurring in an insurance policy year, calendar
year, or fiscal year for a physician participating in an approved
residency program;
(2) at least $300,000 for each health care liability
claim and at least $900,000 in aggregate for all health care
liability claims occurring in an insurance policy year, calendar
year, or fiscal year for a physician or health care provider, other
than a hospital; and
(3) at least $750,000 for each health care liability
claim and at least $2.25 million in aggregate for all health care
liability claims occurring in an insurance policy year, calendar
year, or fiscal year for a hospital.
(d) Effective September 1, 2007, Subsection (a) of this
section applies to any physician or health care provider that
provides evidence of financial responsibility in the following
amounts in effect for any act or omission to which this subchapter
applies:
(1) at least $100,000 for each health care liability
claim and at least $300,000 in aggregate for all health care
liability claims occurring in an insurance policy year, calendar
year, or fiscal year for a physician participating in an approved
residency program;
(2) at least $500,000 for each health care liability
claim and at least $1 million in aggregate for all health care
liability claims occurring in an insurance policy year, calendar
year, or fiscal year for a physician or health care provider, other
than a hospital; and
(3) at least $1 million for each health care liability
claim and at least $3 million in aggregate for all health care
liability claims occurring in an insurance policy year, calendar
year, or fiscal year for a hospital.
(e) Evidence of financial responsibility may be established
at the time of judgment by providing proof of:
(1) the purchase of a contract of insurance or other
plan of insurance authorized by this state;
(2) the purchase of coverage from a trust organized
and operating under Article 21.49-4, Insurance Code;
(3) the purchase of coverage or another plan of
insurance provided by or through a risk retention group or
purchasing group authorized under applicable laws of this state or
under the Product Liability Risk Retention Act of 1981 (15 U.S.C.
Section 3901 et seq.), as amended, or the Liability Risk Retention
Act of 1986 (15 U.S.C. Section 3901 et seq.), as amended, or any
other contract or arrangement for transferring and distributing
risk relating to legal liability for damages, including cost or
defense, legal costs, fees, and other claims expenses; or
(4) the maintenance of financial reserves in or an
irrevocable letter of credit from a federally insured financial
institution that has its main office or a branch office in this
state.
SECTION 10.12. Section 11.04, Medical Liability and
Insurance Improvement Act of Texas (Article 4590i, Vernon's Texas
Civil Statutes), is amended to read as follows:
Sec. 11.04. ADJUSTMENT OF LIABILITY LIMIT [LIMITS]. When
there is an increase or decrease in the consumer price index with
respect to the amount of that index on the effective date of this
subchapter, [each of] the liability limit [limits] prescribed in
Section 11.02(a) [or in Section 11.03] of this subchapter[, as
applicable,] shall be increased or decreased, as applicable, by a
sum equal to the amount of such limit multiplied by the percentage
increase or decrease in the consumer price index between the
effective date of this subchapter and the time at which damages
subject to such limit [limits] are awarded by final judgment or
settlement.
SECTION 10.13. Subchapter L, Medical Liability and
Insurance Improvement Act of Texas (Article 4590i, Vernon's Texas
Civil Statutes), is amended by adding Section 12.02 to read as
follows:
Sec. 12.02. STANDARD OF PROOF IN CASES INVOLVING EMERGENCY
MEDICAL CARE. In a suit involving a health care liability claim
against a physician or health care provider for injury to or death
of a patient arising out of the provision of emergency medical care,
the person bringing the suit may prove that the treatment or lack of
treatment by the physician or health care provider departed from
accepted standards of medical care or health care only if the person
shows by clear and convincing evidence that the physician or health
care provider did not use the degree of care and skill that is
reasonably expected of an ordinarily prudent physician or health
care provider in the same or similar circumstances.
SECTION 10.14. The heading to Section 13.01, Medical
Liability and Insurance Improvement Act of Texas (Article 4590i,
Vernon's Texas Civil Statutes), is amended to read as follows:
Sec. 13.01. [COST BOND, DEPOSIT, AND] EXPERT REPORT.
SECTION 10.15. Section 13.01, Medical Liability and
Insurance Improvement Act of Texas (Article 4590i, Vernon's Texas
Civil Statutes), is amended by amending Subsections (a), (b), (i),
(j), (k), and (l) and adding Subsections (s) and (t) to read as
follows:
(a) In a health care liability claim, a claimant shall, not
later than the 180th [90th] day after the date the claim is filed,
serve on each party or the party's attorney one or more expert
reports, with a curriculum vitae of each expert listed in the[:
[(1) file a separate cost bond in the amount of $5,000
for each physician or health care provider named by the claimant in
the action;
[(2) place cash in an escrow account in the amount of
$5,000 for each physician or health care provider named in the
action; or
[(3) file an expert] report for each physician or
health care provider against whom a liability claim is asserted
[with respect to whom a cost bond has not been filed and cash in lieu
of the bond has not been deposited under Subdivision (1) or (2) of
this subsection].
(b) If, as to a defendant physician or health care provider,
an expert report[, cost bond, or cash in lieu of bond] has not been
served [filed or deposited] within the period specified by
Subsection (a) [or (h)] of this section, the court, on the motion of
the affected physician or health care provider, shall enter an
order that:
(1) awards to the affected physician or health care
provider reasonable attorney's fees and costs of court incurred by
the physician or health care provider [requires the filing of a
$7,500 cost bond with respect to the physician or health care
provider not later than the 21st day after the date of the order];
and
(2) dismisses the claim [provides that if the claimant
fails to comply with the order, the action shall be dismissed for
want of prosecution] with respect to the physician or health care
provider, with prejudice to the refiling of the claim [subject to
reinstatement in accordance with the applicable rules of civil
procedure and Subsection (c) of this section].
(i) Notwithstanding any other provision of this section, a
claimant may satisfy any requirement of this section for serving
[filing] an expert report by serving [filing] reports of separate
experts regarding different physicians or health care providers or
regarding different issues arising from the conduct of a physician
or health care provider, such as issues of liability and causation.
Nothing in this section shall be construed to mean that a single
expert must address all liability and causation issues with respect
to all physicians or health care providers or with respect to both
liability and causation issues for a physician or health care
provider.
(j) Nothing in this section shall be construed to require
the serving [filing] of an expert report regarding any issue other
than an issue relating to liability or causation.
(k) An [Notwithstanding any other law, an] expert report
served [filed] under this section:
(1) is not admissible in evidence by any party [a
defendant];
(2) shall not be used in a deposition, trial, or other
proceeding; and
(3) shall not be referred to by any party [a defendant]
during the course of the action for any purpose.
(l) A court shall grant a motion challenging the adequacy of
an expert report only if it appears to the court, after hearing,
that the report does not represent an objective [a] good faith
effort to comply with the definition of an expert report in
Subsection (r)(6) of this section.
(s) Until a claimant has served the expert report and
curriculum vitae, as required by Subsection (a) of this section,
all discovery in a health care liability claim is stayed except for
the acquisition of the patient's medical records, medical or
psychological studies, or tissue samples through:
(1) written discovery as defined in Rule 192.7, Texas
Rules of Civil Procedure;
(2) depositions on written questions under Rule 200,
Texas Rules of Civil Procedure; and
(3) discovery from nonparties under Rule 205, Texas
Rules of Civil Procedure.
(t) If an expert report is used by the claimant in the course
of the action for any purpose other than to meet the service
requirement of Subsection (a) of this section, the restrictions
imposed by Subsection (k) of this section on use of the expert
report by any party are waived.
SECTION 10.16. Section 13.01(r)(5), Medical Liability and
Insurance Improvement Act of Texas (Article 4590i, Vernon's Texas
Civil Statutes), is amended to read as follows:
(5) "Expert" means:
(A) with respect to a person giving opinion
testimony regarding whether a physician departed from accepted
standards of medical care, an expert qualified to testify under the
requirements of Section 14.01(a) of this Act; [or]
(B) with respect to a person giving opinion
testimony regarding whether [about] a [nonphysician] health care
provider departed from accepted standards of health care, an expert
qualified to testify under the requirements of Section 14.02 of
this Act;
(C) with respect to a person giving opinion
testimony about the causal relationship between the injury, harm,
or damages claimed and the alleged departure from the applicable
standard of care in any health care liability claim, a physician who
is otherwise qualified to render opinions on that causal
relationship under the Texas Rules of Evidence;
(D) with respect to a person giving opinion
testimony about the causal relationship between the injury, harm,
or damages claimed and the alleged departure from the applicable
standard of care for a dentist, a dentist who is otherwise qualified
to render opinions on that causal relationship under the Texas
Rules of Evidence; or
(E) with respect to a person giving opinion
testimony about the causal relationship between the injury, harm,
or damages claimed and the alleged departure from the applicable
standard of care for a podiatrist, a podiatrist who is otherwise
qualified to render opinions on that causal relationship under the
Texas Rules of Evidence [who has knowledge of accepted standards of
care for the diagnosis, care, or treatment of the illness, injury,
or condition involved in the claim].
SECTION 10.17. Sections 14.01(e) and (g), Medical Liability
and Insurance Improvement Act of Texas (Article 4590i, Vernon's
Texas Civil Statutes), are amended to read as follows:
(e) A pretrial objection to the qualifications of a witness
under this section must be made not later than the later of the 21st
day after the date the objecting party receives a copy of the
witness's curriculum vitae or the 21st day after the date of the
witness's deposition. If circumstances arise after the date on
which the objection must be made that could not have been reasonably
anticipated by a party before that date and that the party believes
in good faith provide a basis for an objection to a witness's
qualifications, and if an objection was not made previously, this
subsection does not prevent the party from making an objection as
soon as practicable under the circumstances. The court shall
conduct a hearing to determine whether the witness is qualified as
soon as practicable after the filing of an objection and, if
possible, before trial. If the objecting party is unable to object
in time for the hearing to be conducted before the trial, the
hearing shall be conducted outside the presence of the jury. This
subsection does not prevent a party from examining or
cross-examining a witness at trial about the witness's
qualifications.
(g) In this subchapter [section], "physician" means a
person who is:
(1) licensed to practice medicine in one or more
states in the United States; or
(2) a graduate of a medical school accredited by the
Liaison Committee on Medical Education or the American Osteopathic
Association only if testifying as a defendant and that testimony
relates to that defendant's standard of care, the alleged departure
from that standard of care, or the causal relationship between the
alleged departure from that standard of care and the injury, harm,
or damages claimed.
SECTION 10.18. Subchapter N, Medical Liability and
Insurance Improvement Act of Texas (Article 4590i, Vernon's Texas
Civil Statutes), is amended by adding Sections 14.02 and 14.03 to
read as follows:
Sec. 14.02. QUALIFICATIONS OF EXPERT WITNESS IN SUIT
AGAINST HEALTH CARE PROVIDER. (a) For purposes of this section,
"practicing health care" includes:
(1) training health care providers in the same field
as the defendant health care provider at an accredited educational
institution; or
(2) serving as a consulting health care provider and
being licensed, certified, or registered in the same field as the
defendant health care provider.
(b) In a suit involving a health care liability claim
against a health care provider, a person may qualify as an expert
witness on the issue of whether the health care provider departed
from accepted standards of care only if the person:
(1) is practicing health care in the same field of
practice as the defendant health care provider at the time the
testimony is given or was practicing that type of health care at the
time the claim arose;
(2) has knowledge of accepted standards of care for
health care providers for the diagnosis, care, or treatment of the
illness, injury, or condition involved in the claim; and
(3) is qualified on the basis of training or
experience to offer an expert opinion regarding those accepted
standards of health care.
(c) In determining whether a witness is qualified on the
basis of training or experience, the court shall consider whether,
at the time the claim arose or at the time the testimony is given,
the witness:
(1) is certified by a Texas licensing agency or a
national professional certifying agency, or has other substantial
training or experience, in the area of health care relevant to the
claim; and
(2) is actively practicing health care in rendering
health care services relevant to the claim.
(d) The court shall apply the criteria specified in
Subsections (a), (b), and (c) of this section in determining
whether an expert is qualified to offer expert testimony on the
issue of whether the defendant health care provider departed from
accepted standards of health care but may depart from those
criteria if, under the circumstances, the court determines that
there is good reason to admit the expert's testimony. The court
shall state on the record the reason for admitting the testimony if
the court departs from the criteria.
(e) This section does not prevent a health care provider who
is a defendant, or an employee of the defendant health care
provider, from qualifying as an expert.
(f) A pretrial objection to the qualifications of a witness
under this section must be made not later than the later of the 21st
day after the date the objecting party receives a copy of the
witness's curriculum vitae or the 21st day after the date of the
witness's deposition. If circumstances arise after the date on
which the objection must be made that could not have been reasonably
anticipated by a party before that date and that the party believes
in good faith provide a basis for an objection to a witness's
qualifications, and if an objection was not made previously, this
subsection does not prevent the party from making an objection as
soon as practicable under the circumstances. The court shall
conduct a hearing to determine whether the witness is qualified as
soon as practicable after the filing of an objection and, if
possible, before trial. If the objecting party is unable to object
in time for the hearing to be conducted before the trial, the
hearing shall be conducted outside the presence of the jury. This
subsection does not prevent a party from examining or
cross-examining a witness at trial about the witness's
qualifications.
Sec. 14.03. QUALIFICATIONS OF EXPERT WITNESS ON CAUSATION
IN HEALTH CARE LIABILITY CLAIM. (a) Except as provided by
Subsections (b) and (c) of this section, in a suit involving a
health care liability claim against a physician or health care
provider, a person may qualify as an expert witness on the issue of
the causal relationship between the alleged departure from accepted
standards of care and the injury, harm, or damages claimed only if
the person is a physician and is otherwise qualified to render
opinions on that causal relationship under the Texas Rules of
Evidence.
(b) In a suit involving a health care liability claim
against a dentist, a person may qualify as an expert witness on the
issue of the causal relationship between the alleged departure from
accepted standards of care and the injury, harm, or damages claimed
if the person is a dentist and is otherwise qualified to render
opinions on that causal relationship under the Texas Rules of
Evidence.
(c) In a suit involving a health care liability claim
against a podiatrist, a person may qualify as an expert witness on
the issue of the causal relationship between the alleged departure
from accepted standards of care and the injury, harm, or damages
claimed if the person is a podiatrist and is otherwise qualified to
render opinions on that causal relationship under the Texas Rules
of Evidence.
(d) A pretrial objection to the qualifications of a witness
under this section must be made not later than the later of the 21st
day after the date the objecting party receives a copy of the
witness's curriculum vitae or the 21st day after the date of the
witness's deposition. If circumstances arise after the date on
which the objection must be made that could not have been reasonably
anticipated by a party before that date and that the party believes
in good faith provide a basis for an objection to a witness's
qualifications, and if an objection was not made previously, this
subsection does not prevent the party from making an objection as
soon as practicable under the circumstances. The court shall
conduct a hearing to determine whether the witness is qualified as
soon as practicable after the filing of an objection and, if
possible, before trial. If the objecting party is unable to object
in time for the hearing to be conducted before the trial, the
hearing shall be conducted outside the presence of the jury. This
subsection does not prevent a party from examining or
cross-examining a witness at trial about the witness's
qualifications.
SECTION 10.19. Section 16.01, Medical Liability and
Insurance Improvement Act of Texas (Article 4590i, Vernon's Texas
Civil Statutes), is amended to read as follows:
Sec. 16.01. APPLICATION OF OTHER LAW. Notwithstanding
Chapter 304, Finance Code [Articles 1E.101, 1E.102, and
1E.104-1E.108, Title 79, Revised Statutes], prejudgment interest
in a judgment on a health care liability claim shall be awarded in
accordance with this subchapter.
SECTION 10.20. Sections 16.02(b) and (c), Medical Liability
and Insurance Improvement Act of Texas (Article 4590i, Vernon's
Texas Civil Statutes), are amended to read as follows:
(b) Subject to Subchapter K of this Act [In a health care
liability claim that is not settled within the period specified by
Subsection (a) of this section], the judgment must include
prejudgment interest on past damages awarded in the judgment [found
by the trier of fact], but shall not include prejudgment interest on
future damages awarded in the judgment [found by the trier of fact].
(c) Prejudgment interest allowed under this subchapter
shall be computed in accordance with Section 304.003(c)(1), Finance
Code [Article 1E.103, Title 79, Revised Statutes], for a period
beginning on the date of injury and ending on the date before the
date the judgment is signed.
SECTION 10.21. The Medical Liability and Insurance
Improvement Act of Texas (Article 4590i, Vernon's Texas Civil
Statutes) is amended by adding Subchapters Q, R, S, and T to read as
follows:
SUBCHAPTER Q. COLLATERAL SOURCE BENEFITS
Sec. 17.01. DEFINITION. In this subchapter, "collateral
source benefit" means a benefit paid or payable to or on behalf of a
claimant under:
(1) the Social Security Act (42 U.S.C. Section 301 et
seq.), and its subsequent amendments;
(2) a state or federal income replacement, disability,
workers' compensation, or other law that provides partial or full
income replacement; or
(3) any insurance policy, other than a life insurance
policy, including:
(A) an accident, health, or sickness insurance
policy; and
(B) a disability insurance policy.
Sec. 17.02. ADMISSIBILITY OF EVIDENCE OF COLLATERAL SOURCE
BENEFITS. A defendant physician or health care provider may
introduce evidence in a health care liability claim of any amount
payable to the claimant as a collateral benefit. If a defendant
physician or health care provider introduces evidence of a
collateral source benefit, the claimant may introduce evidence of
any amount the claimant has paid to secure the right to the benefit.
Sec. 17.03. MAINTENANCE OF COVERAGE DURING CLAIM. (a)
During the pendency of a health care liability claim, if the
claimant has a policy of insurance that provides health benefits or
income disability coverage and the claimant is unwilling or unable
to pay the costs of renewing or continuing that policy of insurance
in force, the defendant physician or health care provider may
tender to the claimant the cost of maintaining the insurance
coverage.
(b) On receipt of the tender, the claimant shall continue
the policy in force.
Sec. 17.04. SUBROGATION. The payer of collateral benefits
introduced under this subchapter may not recover any amount against
the claimant and is not subrogated to any rights or claims of the
claimant, unless authorized by a federal law.
SUBCHAPTER R. PAYMENT FOR FUTURE LOSSES
Sec. 18.01. DEFINITIONS. In this subchapter:
(1) "Future damages" means damages that are incurred
after the date of judgment for:
(A) medical, health care, or custodial care
services;
(B) physical pain and mental anguish,
disfigurement, or physical impairment;
(C) loss of consortium, companionship, or
society; or
(D) loss of earnings.
(2) "Future loss of earnings" means the following
losses incurred after the date of the judgment:
(A) loss of income, wages, or earning capacity
and other pecuniary losses; and
(B) loss of inheritance.
(3) "Periodic payments" means the payment of money or
its equivalent to the recipient of future damages at defined
intervals.
Sec. 18.02. SCOPE OF SUBCHAPTER. This subchapter applies
only to an action on a health care liability claim against a
physician or health care provider in which the present value of the
award of future damages, as determined by the court, equals or
exceeds $100,000.
Sec. 18.03. COURT ORDER FOR PERIODIC PAYMENTS. (a) At the
request of a defendant physician or health care provider or
claimant, the court shall order that future damages awarded in a
health care liability claim be paid in whole or in part in periodic
payments rather than by a lump-sum payment.
(b) The court shall make a specific finding of the dollar
amount of periodic payments that will compensate the claimant for
the future damages.
(c) The court shall specify in its judgment ordering the
payment of future damages by periodic payments the:
(1) recipient of the payments;
(2) dollar amount of the payments;
(3) interval between payments; and
(4) number of payments or the period of time over which
payments must be made.
Sec. 18.04. RELEASE. The entry of an order for the payment
of future damages by periodic payments constitutes a release of the
health care liability claim filed by the claimant.
Sec. 18.05. FINANCIAL RESPONSIBILITY. (a) As a condition
to authorizing periodic payments of future damages, the court shall
require a defendant who is not adequately insured to provide
evidence of financial responsibility in an amount adequate to
assure full payment of damages awarded by the judgment.
(b) The judgment must provide for payments to be funded by:
(1) an annuity contract issued by a company licensed
to do business as an insurance company;
(2) an obligation of the United States;
(3) applicable and collectible liability insurance
from one or more qualified insurers; or
(4) any other satisfactory form of funding approved by
the court.
(c) On termination of periodic payments of future damages,
the court shall order the return of the security, or as much as
remains, to the defendant.
Sec. 18.06. DEATH OF RECIPIENT. (a) On the death of the
recipient, money damages awarded for loss of future earnings
continue to be paid to the estate of the recipient of the award
without reduction.
(b) Periodic payments, other than future loss of earnings,
terminate on the death of the recipient.
(c) If the recipient of periodic payments dies before all
payments required by the judgment are paid, the court may modify the
judgment to award and apportion the unpaid damages for future loss
of earnings in an appropriate manner.
(d) Following the satisfaction or termination of any
obligations specified in the judgment for periodic payments, any
obligation of the defendant physician or health care provider to
make further payments ends and any security given reverts to the
defendant.
Sec. 18.07. AWARD OF ATTORNEY'S FEES. For purposes of
computing the award of attorney's fees when the claimant is awarded
a recovery that will be paid in periodic payments, the court shall:
(1) place a total value on the payments based on the
claimant's projected life expectancy; and
(2) reduce the amount in Subdivision (1) to present
value.
SUBCHAPTER S. ATTORNEY'S FEES
Sec. 19.01. DEFINITION. In this subchapter, "recovered"
means the net sum recovered after deducting any disbursements or
costs incurred in connection with prosecution or settlement of the
claim. Costs of medical or health care services incurred by the
claimant and the attorney's office overhead costs or charges are
not deductible disbursements or costs.
Sec. 19.02. APPLICABILITY. The limitations in this
subchapter apply without regard to whether:
(1) the recovery is by settlement, arbitration, or
judgment; or
(2) the person for whom the recovery is sought is an
adult, a minor, or an incapacitated person.
Sec. 19.03. PERIODIC PAYMENTS. If periodic payments are
recovered by the claimant, the court shall place a total value on
these payments based on the claimant's projected life expectancy
and then reduce this amount to present value for purposes of
computing the award of attorney's fees.
Sec. 19.04. LIMITATION ON ATTORNEY CONTINGENCY FEE
AGREEMENTS. (a) An attorney may not contract for or collect a
contingency fee for representing any person seeking damages in
connection with a health care liability claim in excess of 33-1/3
percent of the amount recovered.
(b) This section has no effect if Section 11.03 of this Act
is stricken from this Act or is otherwise to any extent invalidated
by a method other than through legislative means.
Sec. 19.05. ALTERNATIVE LIMIT ON ATTORNEY CONTINGENCY FEES.
(a) If Section 11.03 of this Act is stricken from this Act or is
otherwise to any extent invalidated by a method other than through
legislative means, this section is effective.
(b) An attorney may not contract for or collect a
contingency fee for representing any person seeking damages in
connection with a health care liability claim that exceeds the
following limits:
(1) 40 percent of the first $50,000 recovered;
(2) 33.3 percent of the next $50,000 recovered;
(3) 25 percent of the next $500,000 recovered; and
(4) 15 percent of any additional amount recovered.
SUBCHAPTER T. DECLARATORY JUDGMENTS; INJUNCTIONS; APPEALS
Sec. 20.01. APPLICABILITY. This subchapter applies only to
an amendment to this Act that is effective on or after January 1,
2003.
Sec. 20.02. DECLARATORY JUDGMENT. The constitutionality
and other validity under the state or federal constitution of all or
any part of an amendment to this Act may be determined in an action
for declaratory judgment in a district court in Travis County under
Chapter 37, Civil Practice and Remedies Code, if it is alleged that
the amendment or a part of the amendment affects the rights, status,
or legal relation of a party in a civil action with respect to any
other party in the civil action.
Sec. 20.03. ACCELERATED APPEAL. (a) An appeal of a
declaratory judgment or order, however characterized, of a district
court, including an appeal of the judgment of an appellate court,
holding or otherwise determining, under Section 20.02 of this
subchapter, that all or any part of an amendment to this Act is
constitutional or unconstitutional, or otherwise valid or invalid,
under the state or federal constitution is an accelerated appeal.
(b) If the judgment or order is interlocutory, an
interlocutory appeal may be taken from the judgment or order and is
an accelerated appeal.
Sec. 20.04. INJUNCTIONS. A district court in Travis County
may grant or deny a temporary or otherwise interlocutory injunction
or a permanent injunction on the grounds of the constitutionality
or unconstitutionality, or other validity or invalidity, under the
state or federal constitution of all or any part of an amendment to
this Act.
Sec. 20.05. DIRECT APPEAL. (a) There is a direct appeal to
the supreme court from an order, however characterized, of a trial
court granting or denying a temporary or otherwise interlocutory
injunction or a permanent injunction on the grounds of the
constitutionality or unconstitutionality, or other validity or
invalidity, under the state or federal constitution of all or any
part of any amendment to this Act.
(b) The direct appeal is an accelerated appeal.
(c) This section exercises the authority granted by Section
3-b, Article V, Texas Constitution.
Sec. 20.06. STANDING OF AN ASSOCIATION OR ALLIANCE TO SUE.
(a) An association or alliance has standing to sue for and obtain
the relief described by Subsection (b) of this section if it is
alleged that:
(1) the association or alliance has more than one
member who has standing to sue in the member's own right;
(2) the interests the association or alliance seeks to
protect are germane to a purpose of the association or alliance; and
(3) the claim asserted and declaratory relief
requested by the association or alliance relate to all or a
specified part of the amendment involved in the action being found
constitutional or unconstitutional on its face, or otherwise found
valid or invalid on its face, under the state or federal
constitution.
(b) The association or alliance has standing:
(1) to sue for and obtain a declaratory judgment under
Section 20.02 of this subchapter in an action filed and maintained
by the association or alliance;
(2) to appeal or otherwise be a party to an appeal
under Section 20.03 of this subchapter;
(3) to sue for and obtain an order under Section 20.04
of this subchapter granting or denying a temporary or otherwise
interlocutory injunction or a permanent injunction in an action
filed and maintained by the association or alliance; and
(4) to appeal or otherwise be a party to an appeal
under Section 20.05 of this subchapter.
Sec. 20.07. RULES FOR APPEALS. An appeal under this
subchapter, including an interlocutory, accelerated, or direct
appeal, is governed, as applicable, by the Texas Rules of Appellate
Procedure, including Rules 25.1(d)(6), 26.1(b), 28.1, 28.3,
32.1(g), 37.3(a)(1), 38.6(a) and (b), 40.1(b), and 49.4.
SECTION 10.22. Section 84.003, Civil Practice and Remedies
Code, is amended by adding Subdivision (6) to read as follows:
(6) "Person responsible for the patient" means:
(A) the patient's parent, managing conservator,
or guardian;
(B) the patient's grandparent;
(C) the patient's adult brother or sister;
(D) another adult who has actual care, control,
and possession of the patient and has written authorization to
consent for the patient from the parent, managing conservator, or
guardian of the patient;
(E) an educational institution in which the
patient is enrolled that has written authorization to consent for
the patient from the parent, managing conservator, or guardian of
the patient; or
(F) any other person with legal responsibility
for the care of the patient.
SECTION 10.23. Section 84.004(c), Civil Practice and
Remedies Code, is amended to read as follows:
(c) Except as provided by Subsection (d) and Section 84.007,
a volunteer health care provider [who is serving as a direct service
volunteer of a charitable organization] is immune from civil
liability for any act or omission resulting in death, damage, or
injury to a patient if:
(1) [the volunteer was acting in good faith and in the
course and scope of the volunteer's duties or functions within the
organization;
[(2)] the volunteer commits the act or omission in the
course of providing health care services to the patient;
(2) [(3)] the services provided are within the scope
of the license of the volunteer; and
(3) [(4)] before the volunteer provides health care
services, the patient or, if the patient is a minor or is otherwise
legally incompetent, the person responsible for the patient
[patient's parent, managing conservator, legal guardian, or other
person with legal responsibility for the care of] signs a written
statement that acknowledges:
(A) that the volunteer is providing care that is
not administered for or in expectation of compensation; and
(B) the limitations on the recovery of damages
from the volunteer in exchange for receiving the health care
services.
SECTION 10.24. Chapter 84, Civil Practice and Remedies
Code, is amended by adding Section 84.0065 to read as follows:
Sec. 84.0065. ORGANIZATION LIABILITY OF HOSPITALS. Except
as provided by Section 84.007, in any civil action brought against a
hospital or hospital system, or its employees, officers, directors,
or volunteers, for damages based on an act or omission by the
hospital or hospital system, or its employees, officers, directors,
or volunteers, the liability of the hospital or hospital system is
limited to money damages in a maximum amount of $500,000 for any act
or omission resulting in death, damage, or injury to a patient if
the patient or, if the patient is a minor or is otherwise legally
incompetent, the person responsible for the patient, signs a
written statement that acknowledges:
(1) that the hospital is providing care that is not
administered for or in expectation of compensation; and
(2) the limitations on the recovery of damages from
the hospital in exchange for receiving the health care services.
SECTION 10.25. Section 88.002, Civil Practice and Remedies
Code, is amended by adding Subsection (l) to read as follows:
(l) This chapter does not create liability on the part of
physicians or health care providers for medical care or health care
services performed or furnished or that should have been performed
or furnished for, to, or on behalf of a patient.
SECTION 10.26. Article 5.15-1, Insurance Code, is amended
by adding Section 11 to read as follows:
Sec. 11. VENDOR'S ENDORSEMENT. An insurer may not exclude
or otherwise limit coverage for physicians or health care providers
under a vendor's endorsement issued to a manufacturer, as that term
is defined by Section 82.001, Civil Practice and Remedies Code. A
physician or health care provider shall be considered a vendor for
purposes of coverage under a vendor's endorsement or a
manufacturer's general liability or products liability policy.
SECTION 10.27. The following provisions are repealed:
(1) Section 11.02(c), Medical Liability and Insurance
Improvement Act of Texas (Article 4590i, Vernon's Texas Civil
Statutes);
(2) Sections 13.01(c), (d), (e), (f), (g), (h), (m),
(n), (o), and (r)(3), Medical Liability and Insurance Improvement
Act of Texas (Article 4590i, Vernon's Texas Civil Statutes);
(3) Section 16.02(a), Medical Liability and Insurance
Improvement Act of Texas (Article 4590i, Vernon's Texas Civil
Statutes); and
(4) Section 242.0372, Health and Safety Code.
SECTION 10.28. (a) The Legislature of the State of Texas
finds that:
(1) the number of health care liability claims
(frequency) has increased since 1995 inordinately;
(2) the filing of legitimate health care liability
claims in Texas is a contributing factor affecting medical
professional liability rates;
(3) the amounts being paid out by insurers in
judgments and settlements (severity) have likewise increased
inordinately in the same short period of time;
(4) the effect of the above has caused a serious public
problem in availability of and affordability of adequate medical
professional liability insurance;
(5) the situation has created a medical malpractice
insurance crisis in Texas;
(6) this crisis has had a material adverse effect on
the delivery of medical and health care in Texas, including
significant reductions of availability of medical and health care
services to the people of Texas and a likelihood of further
reductions in the future;
(7) the crisis has had a substantial impact on the
physicians and hospitals of Texas and the cost to physicians and
hospitals for adequate medical malpractice insurance has
dramatically risen in price, with cost impact on patients and the
public;
(8) the direct cost of medical care to the patient and
public of Texas has materially increased due to the rising cost of
malpractice insurance protection for physicians and hospitals in
Texas;
(9) the crisis has increased the cost of medical care
both directly through fees and indirectly through additional
services provided for protection against future suits or claims,
and defensive medicine has resulted in increasing cost to patients,
private insurers, and Texas and has contributed to the general
inflation that has marked health care in recent years;
(10) satisfactory insurance coverage for adequate
amounts of insurance in this area is often not available at any
price;
(11) the combined effect of the defects in the
medical, insurance, and legal systems has caused a serious public
problem both with respect to the availability of coverage and to the
high rates being charged by insurers for medical professional
liability insurance to some physicians, health care providers, and
hospitals; and
(12) the adoption of certain modifications in the
medical, insurance, and legal systems, the total effect of which is
currently undetermined, will have a positive effect on the rates
charged by insurers for medical professional liability insurance.
(b) Because of the conditions stated in Subsection (a) of
this section, it is the purpose of this article to improve and
modify the system by which health care liability claims are
determined in order to:
(1) reduce excessive frequency and severity of health
care liability claims through reasonable improvements and
modifications in the Texas insurance, tort, and medical practice
systems;
(2) decrease the cost of those claims and ensure that
awards are rationally related to actual damages;
(3) do so in a manner that will not unduly restrict a
claimant's rights any more than necessary to deal with the crisis;
(4) make available to physicians, hospitals, and other
health care providers protection against potential liability
through the insurance mechanism at reasonably affordable rates;
(5) make affordable medical and health care more
accessible and available to the citizens of Texas;
(6) make certain modifications in the medical,
insurance, and legal systems in order to determine whether or not
there will be an effect on rates charged by insurers for medical
professional liability insurance;
(7) make certain modifications to the liability laws
as they relate to health care liability claims only and with an
intention of the legislature to not extend or apply such
modifications of liability laws to any other area of the Texas legal
system or tort law;
(8) encourage offering services by physicians and
hospitals, particularly those involving high risk, that will
benefit, in particular, high-cost and low-income groups because
lower malpractice insurance rates increase the willingness of
physicians and hospitals to provide treatments that carry a
relatively high risk of failure but offer the only real prospect of
success for seriously ill patients;
(9) encourage quality of care and discourage defensive
medicine;
(10) decrease malpractice insurance premiums, which
are a significant part of overall health care cost, and, as the cost
savings are reflected in health insurance premiums, make health
insurance benefit programs more affordable to businesses,
particularly small businesses, and increase employee participation
in health insurance programs offered by their employers;
(11) discourage unnecessary services and encourage
fewer tests, procedures, and visits so that the direct financial
cost to the patient will be reduced as well as time, travel, and
other indirect costs;
(12) support health care insurance for employers and
employees because malpractice insurance is a component of the
overhead costs that providers must take into account in negotiating
reimbursement rates with commercial insurers and employers that pay
all or a portion of the premiums for their employees will save money
and may make the difference in whether an employer can afford to
maintain current health insurance benefits for its employees;
(13) reduce the time required for plaintiffs to obtain
awards;
(14) reduce malpractice pressure and, as a result,
increase the supply of physicians, especially obstetricians and
other impacted specialists;
(15) contribute to the viability of community
hospitals by lowering malpractice insurance premiums;
(16) free funds in the operating budgets of
self-insured hospitals, allowing the hospital to treat more
patients;
(17) reduce or eliminate the incentive for physicians
to go without insurance;
(18) lower costs for teaching and safety-net hospitals
as well as nonprofit community clinics;
(19) decrease the costs for health care facilities
that self-insure; and
(20) allow the Texas Medicaid program to save
resources that can be used to provide additional health care goods
and services.
SECTION 10.29. (a) Except as provided by Sections 10.30
and 10.31 of this article, the changes in law made by this article
to the Medical Liability and Insurance Improvement Act of Texas
(Article 4590i, Vernon's Texas Civil Statutes) apply to a cause of
action that accrues on or after January 1, 2004. Except as provided
by this section and Sections 10.30 and 10.31 of this article, a
cause of action that accrues before January 1, 2004, is governed by
the law in effect immediately before the effective date of this
article, and that law is continued in effect for that purpose.
(b) Subchapter S, Medical Liability and Insurance
Improvement Act of Texas (Article 4590i, Vernon's Texas Civil
Statutes), as added by this article, applies only to an attorney's
fee agreement or contract that is entered into on or after January
1, 2004. An attorney's fee agreement or contract entered into
before January 1, 2004, is governed by the law in effect immediately
before the effective date of this article, and that law is continued
in effect for that purpose.
(c) This article does not make any change in law with
respect to the adjustment under Section 11.04, Medical Liability
and Insurance Improvement Act of Texas (Article 4590i, Vernon's
Texas Civil Statutes), of the liability limit prescribed in Section
11.02(a) of that Act, and that law is continued in effect only for
that liability limit.
SECTION 10.30. (a) This section applies only if this
article takes effect September 1, 2003.
(b) All changes in law made by this article to the Medical
Liability and Insurance Improvement Act of Texas (Article 4590i,
Vernon's Texas Civil Statutes), other than Subchapter S, added by
this article, also apply to a health care liability claim that is
included in an action or suit filed on or after September 1, 2003,
and to that action or suit.
(c) If written notice of a health care liability claim is
given by certified mail, return receipt requested, in compliance
with Section 4.01(a), Medical Liability and Insurance Improvement
Act of Texas (Article 4590i, Vernon's Texas Civil Statutes), on or
after June 1, 2003, and before September 1, 2003, the giving of that
notice constitutes, for purposes of this section, the filing, as of
the date of depositing that notice in the mail, of an action or suit
that includes that claim against each physician or health care
provider to whom that notice is given.
SECTION 10.31. (a) This section applies only if this
article takes effect immediately.
(b) All changes in law made by this article to the Medical
Liability and Insurance Improvement Act of Texas (Article 4590i,
Vernon's Texas Civil Statutes), other than Subchapter S, added by
this article, also apply to a health care liability claim that is
included in an action or suit filed on or after the 60th day after
the effective date of this article, and to that action or suit.
(c) If written notice of a health care liability claim is
given by certified mail, return receipt requested, in compliance
with Section 4.01(a), Medical Liability and Insurance Improvement
Act of Texas (Article 4590i, Vernon's Texas Civil Statutes), on or
after the effective date of this article, and before the 60th day
after the effective date of this article, the giving of that notice
constitutes, for purposes of this section, the filing, as of the
date of depositing that notice in the mail, of an action or suit
that includes that claim against each physician or health care
provider to whom that notice is given.
ARTICLE 11. CLAIMS AGAINST EMPLOYEES OR VOLUNTEERS OF A UNIT OF
LOCAL GOVERNMENT
SECTION 11.01. Sections 108.002(a) and (b), Civil Practice
and Remedies Code, are amended to read as follows:
(a) Except in an action arising under the constitution or
laws of the United States, a public servant [, other than a provider
of health care as that term is defined in Section 108.002(c),] is
not personally liable for damages in excess of $100,000 arising
from personal injury, death, or deprivation of a right, privilege,
or immunity if:
(1) the damages are the result of an act or omission by
the public servant in the course and scope of the public servant's
office, employment, or contractual performance for or service on
behalf of a state agency, institution, department, or local
government; and
(2) for the amount not in excess of $100,000, the
public servant is covered:
(A) by the state's obligation to indemnify under
Chapter 104;
(B) by a local government's authorization to
indemnify under Chapter 102;
(C) by liability or errors and omissions
insurance; or
(D) by liability or errors and omissions coverage
under an interlocal agreement.
(b) Except in an action arising under the constitution or
laws of the United States, a public servant [, other than a provider
of health care as that term is defined in Section 108.002(c),] is
not liable for damages in excess of $100,000 for property damage if:
(1) the damages are the result of an act or omission by
the public servant in the course and scope of the public servant's
office, employment, or contractual performance for or service on
behalf of a state agency, institution, department, or local
government; and
(2) for the amount not in excess of $100,000, the
public servant is covered:
(A) by the state's obligation to indemnify under
Chapter 104;
(B) by a local government's authorization to
indemnify under Chapter 102;
(C) by liability or errors and omissions
insurance; or
(D) by liability or errors and omissions coverage
under an interlocal agreement.
SECTION 11.02. Section 285.071, Health and Safety Code, is
amended to read as follows:
Sec. 285.071. DEFINITION. In this chapter, "hospital
district management contractor" means a nonprofit corporation,
partnership, or sole proprietorship that manages a hospital or
provides services [as a part of a rural health network as defined
under 42 U.S.C. Section 1395i-4(g)] under contract with a hospital
district that was created by general or special law [and that has a
population under 50,000].
SECTION 11.03. Section 108.002(c), Civil Practice and
Remedies Code, is repealed.
SECTION 11.04. This article applies to a suit filed on or
after the effective date of this article.
ARTICLE 12. JUROR QUALIFICATION
SECTION 12.01. Section 62.105, Government Code, is amended
to read as follows:
Sec. 62.105. DISQUALIFICATION FOR PARTICULAR JURY. (a) A
person is disqualified to serve as a petit juror in a particular
case if the person [he]:
(1) is a witness in the case;
(2) is interested, directly or indirectly, in the
subject matter of the case;
(3) is related by consanguinity or affinity within the
third degree, as determined under Chapter 573, to a party in the
case;
(4) has a bias or prejudice in favor of or against a
party in the case; or
(5) has served as a petit juror in a former trial of
the same case or in another case involving the same questions of
fact.
(b) In an action seeking damages for personal injury or
death, a person's answer in voir dire that the person could not
award a certain sum of money damages based on a hypothetical set of
circumstances does not, in and of itself, establish a bias or
prejudice in favor of or against a party in the action that warrants
disqualification under Subsection (a)(4).
SECTION 12.02. (a) Except as provided by Subsection (b) of
this section, this article applies only to a suit commenced or
pending on or after the effective date of this article.
(b) This article does not apply to a suit in which the trial
on the merits commenced on or before the effective date of this
article; that suit is governed by the law in effect immediately
before the change in law made by this article, and that law is
continued in effect for that purpose.
ARTICLE 13. EXEMPLARY DAMAGES
SECTION 13.01. Section 41.001(1), Civil Practice and
Remedies Code, is amended to read as follows:
(1) "Claimant" means a person [party], including a
plaintiff, counterclaimant, cross-claimant, or third-party
plaintiff, seeking or who has sought recovery of exemplary damages.
In a cause of action in which a party seeks recovery of exemplary
damages related to injury to another person, damage to the property
of another person, death of another person, or other harm to another
person, "claimant" includes both that other person and the party
seeking recovery of exemplary damages.
SECTION 13.02. Sections 41.008(b) and (c), Civil Practice
and Remedies Code, are amended to read as follows:
(b) Exemplary damages awarded against a defendant to a
claimant may not exceed an amount equal to the greater of:
(1)(A) two times the amount of economic damages to be
awarded in the judgment; plus
(B) an amount equal to any noneconomic damages to
be awarded in the judgment [found by the jury], not to exceed
$750,000; or
(2) $200,000.
(c) Subsection (b) does not apply to a cause of action
against a defendant from whom a plaintiff seeks recovery of
exemplary damages based on conduct for which the defendant has been
convicted of [described as] a felony in the following sections or
chapter of the Penal Code if, except for Sections 49.07 and 49.08,
the conduct was committed knowingly or intentionally:
(1) Section 19.02 (murder);
(2) Section 19.03 (capital murder);
(3) Section 20.04 (aggravated kidnapping);
(4) Section 22.02 (aggravated assault);
(5) Section 22.011 (sexual assault);
(6) Section 22.021 (aggravated sexual assault);
(7) Section 22.04 (injury to a child, elderly
individual, or disabled individual);
(8) Section 32.21 (forgery);
(9) Section 32.43 (commercial bribery);
(10) Section 32.45 (misapplication of fiduciary
property or property of financial institution);
(11) Section 32.46 (securing execution of document by
deception);
(12) Section 32.47 (fraudulent destruction, removal,
or concealment of writing);
(13) Chapter 31 (theft) the punishment level for which
is a felony of the third degree or higher;
(14) Section 49.07 (intoxication assault); or
(15) Section 49.08 (intoxication manslaughter).
SECTION 13.03. (a) Except as provided by Subsection (b) of
this section, this article applies only to a suit commenced or
pending on or after the effective date of this article.
(b) This article does not apply to a suit in which the trial
on the merits commenced on or before the effective date of this
article; that suit is governed by the law in effect immediately
before the change in law made by this article, and that law is
continued in effect for that purpose.
ARTICLE 14. ASSIGNMENT OF JUDGES
SECTION 14.01. Subchapter B, Chapter 74, Government Code,
is amended by adding Section 74.0241 to read as follows:
Sec. 74.0241. ASSIGNMENT OF JUDGES FOR HEALTH CARE
LIABILITY CLAIMS. (a) In this section, "health care liability
claim" has the meaning assigned by Section 1.03, Medical Liability
and Insurance Improvement Act of Texas (Article 4590i, Vernon's
Texas Civil Statutes).
(b) Notwithstanding any other law or rule, and on motion of
a party to a health care liability claim, the supreme court shall
assign a judge for the health care liability claim and any action or
suit that includes the claim.
(c) The supreme court shall provide each party to the health
care liability claim and any action or suit that includes the claim
a list of the judges from whom the assigned judge will be selected.
(d) Within a period specified by the supreme court, each of
the following groups of parties may file with the supreme court a
written objection to one of the judges on the list provided under
Subsection (c) who is not a regular judge in the county in which the
suit is pending:
(1) all of the parties asserting the claim;
(2) all of the parties against whom the claim is
asserted; and
(3) all other parties in the case.
(e) After the period specified for filing an objection under
Subsection (d) has expired, no further objection may be made. The
supreme court shall assign one judge on the list who has not been
timely objected to under Subsection (d) to serve as the assigned
judge for the health care liability claim and any action or suit
that includes the claim.
(f) Notwithstanding any other law or rule, the supreme court
has authority to issue any rule necessary or appropriate to
implement this section.
SECTION 14.02. (a) Except as provided by Subsection (b) of
this section, this article applies only to a suit commenced or
pending on or after the effective date of this article.
(b) This article does not apply to a suit in which the trial
on the merits commenced on or before the effective date of this
article; that suit is governed by the law in effect immediately
before the change in law made by this article, and that law is
continued in effect for that purpose.
ARTICLE 15. PUBLIC SCHOOL TEACHERS
SECTION 15.01. Section 22.051, Education Code, is amended
by adding Subsection (a-1) and amending Subsections (b) and (c) to
read as follows:
(a-1) A teacher employed by a school district is not
personally liable for any act that is incident to or within the
scope of the duties of the teacher's position of employment. This
subsection does not apply to any act that constitutes a criminal
offense, including sexual misconduct.
(b) Subsection (a) [This section] does not apply to the
operation, use, or maintenance of any motor vehicle.
(c) In this section, "professional employee" includes:
(1) a superintendent, principal, [teacher,]
supervisor, social worker, counselor, nurse, and teacher's aide;
(2) a student in an education preparation program
participating in a field experience or internship;
(3) a school bus driver certified in accordance with
standards and qualifications adopted by the Department of Public
Safety; and
(4) any other person, except a teacher, whose
employment requires certification and the exercise of discretion.
SECTION 15.02. This article applies only to a cause of
action that accrues on or after the effective date of this article.
An action that accrued before the effective date of this article is
governed by the law applicable to the action immediately before the
effective date of this article, and that law is continued in effect
for that purpose.
ARTICLE 16. EFFECTIVE DATE
SECTION 16.01. (a) All articles of this Act, other than
Article 10, take effect September 1, 2003.
(b) Article 10 of this Act takes effect immediately if this
Act receives a vote of two-thirds of all the members elected to each
house, as provided by Section 39, Article III, Texas Constitution.
If this Act does not receive the vote necessary for immediate
effect, Article 10 of this Act takes effect September 1, 2003.
(c) The articles of this Act apply as provided by each
article.