By: Buckingham S.B. No. 1258
 
  (Moody)
 
   
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to the prosecution of limited liability companies and
  other business entities under the Penal Code.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Section 1.07(a)(38), Penal Code, is amended to
  read as follows:
               (38)  "Person" means an individual or a[,] corporation,
  [or] association, limited liability company, or other entity or
  organization governed by the Business Organizations Code.
         SECTION 2.  Subchapter B, Chapter 7, Penal Code, is amended
  to read as follows:
  SUBCHAPTER B.  CORPORATIONS, [AND] ASSOCIATIONS, LIMITED LIABILITY
  COMPANIES, AND OTHER BUSINESS ENTITIES
         Sec. 7.21.  DEFINITIONS. In this subchapter:
               (1)  "Agent" means a director, officer, employee, or
  other person authorized to act in behalf of a corporation, an [or]
  association, a limited liability company, or another business
  entity.
               (1-a)  "Business entity" means an entity or
  organization governed by the Business Organizations Code, other
  than a corporation, association, or limited liability company.
               (2)  "High managerial agent" means:
                     (A)  a partner in a partnership;
                     (B)  an officer of a corporation, an [or]
  association, a limited liability company, or another business
  entity;
                     (C)  an agent of a corporation, an [or]
  association, a limited liability company, or another business
  entity who has duties of such responsibility that the agent's [his]
  conduct reasonably may be assumed to represent the policy of the
  corporation, [or] association, limited liability company, or other
  business entity.
         Sec. 7.22.  CRIMINAL RESPONSIBILITY OF CORPORATION, [OR]
  ASSOCIATION, LIMITED LIABILITY COMPANY, OR OTHER BUSINESS ENTITY.  
  (a)  If conduct constituting an offense is performed by an agent
  acting in behalf of a corporation, an [or] association, a limited
  liability company, or another business entity and within the scope
  of the agent's [his] office or employment, the corporation, [or]
  association, limited liability company, or other business entity is
  criminally responsible for an offense defined:
               (1)  in this code where corporations, [and]
  associations, limited liability companies, and other business
  entities are made subject thereto;
               (2)  by law other than this code in which a legislative
  purpose to impose criminal responsibility on corporations, [or]
  associations, limited liability companies, and other business
  entities plainly appears; or
               (3)  by law other than this code for which strict
  liability is imposed, unless a legislative purpose not to impose
  criminal responsibility on corporations, [or] associations,
  limited liability companies, or other business entities plainly
  appears.
         (b)  A corporation, an [or] association, a limited liability
  company, or another business entity is criminally responsible for a
  felony offense only if its commission was authorized, requested,
  commanded, performed, or recklessly tolerated by:
               (1)  a majority of the governing body [board] acting in
  behalf of the corporation, [or] association, limited liability
  company, or other business entity; or
               (2)  a high managerial agent acting in behalf of the
  corporation, [or] association, limited liability company, or other
  business entity and within the scope of the agent's [his] office or
  employment.
         Sec. 7.23.  CRIMINAL RESPONSIBILITY OF PERSON FOR CONDUCT IN
  BEHALF OF CORPORATION, [OR] ASSOCIATION, LIMITED LIABILITY
  COMPANY, OR OTHER BUSINESS ENTITY.  (a)  An individual is
  criminally responsible for conduct that the individual [he]
  performs in the name of or in behalf of a corporation, an [or]
  association, a limited liability company, or another business
  entity to the same extent as if the conduct were performed in the
  individual's [his] own name or behalf.
         (b)  An agent having primary responsibility for the
  discharge of a duty to act imposed by law on a corporation, an [or]
  association, a limited liability company, or another business
  entity is criminally responsible for omission to discharge the duty
  to the same extent as if the duty were imposed by law directly on the
  agent [him].
         (c)  If an individual is convicted of conduct constituting an
  offense performed in the name of or on behalf of a corporation, an
  [or] association, a limited liability company, or another business
  entity, the individual [he] is subject to the sentence authorized
  by law for an individual convicted of the offense.
         Sec. 7.24.  DEFENSE TO CRIMINAL RESPONSIBILITY OF  
  CORPORATION, [OR] ASSOCIATION, LIMITED LIABILITY COMPANY, OR OTHER
  BUSINESS ENTITY.  It is an affirmative defense to prosecution of a
  corporation, an [or] association, a limited liability company, or
  another business entity under Section 7.22(a)(1) or (a)(2) that the
  high managerial agent having supervisory responsibility over the
  subject matter of the offense employed due diligence to prevent its
  commission.
         SECTION 3.  Section 12.51, Penal Code, is amended to read as
  follows:
         Sec. 12.51.  AUTHORIZED PUNISHMENTS FOR CORPORATIONS, [AND]
  ASSOCIATIONS, LIMITED LIABILITY COMPANIES, AND OTHER BUSINESS
  ENTITIES.  (a)  If a corporation, an [or] association, a limited
  liability company, or another business entity is adjudged guilty of
  an offense that provides a penalty consisting of a fine only, a
  court may sentence the corporation, [or] association, limited
  liability company, or other business entity to pay a fine in an
  amount fixed by the court, not to exceed the fine provided by the
  offense.
         (b)  If a corporation, an [or] association, a limited
  liability company, or another business entity is adjudged guilty of
  an offense that provides a penalty including imprisonment, or that
  provides no specific penalty, a court may sentence the corporation,
  [or] association, limited liability company, or other business
  entity to pay a fine in an amount fixed by the court, not to exceed:
               (1)  $20,000 if the offense is a felony of any category;
               (2)  $10,000 if the offense is a Class A or Class B
  misdemeanor;
               (3)  $2,000 if the offense is a Class C misdemeanor; or
               (4)  $50,000 if, as a result of an offense classified as
  a felony or Class A misdemeanor, an individual suffers serious
  bodily injury or death.
         (c)  In lieu of the fines authorized by Subsections (a),
  (b)(1), (b)(2), and (b)(4), if a court finds that the corporation,
  [or] association, limited liability company, or other business
  entity gained money or property or caused personal injury or death,
  property damage, or other loss through the commission of a felony or
  Class A or Class B misdemeanor, the court may sentence the
  corporation, [or] association, limited liability company, or other
  business entity to pay a fine in an amount fixed by the court, not to
  exceed double the amount gained or caused by the corporation, [or]
  association, limited liability company, or business entity to be
  lost or damaged, whichever is greater.
         (d)  In addition to any sentence that may be imposed by this
  section, a corporation, an [or] association, a limited liability
  company, or another business entity that has been adjudged guilty
  of an offense may be ordered by the court to give notice of the
  conviction to any person the court deems appropriate.
         (e)  On conviction of a corporation, an [or] association, a
  limited liability company, or another business entity, the court
  shall notify the attorney general of that fact.
         (f)  In this section, "business entity" has the meaning
  assigned by Section 7.21.
         SECTION 4.  Section 20.01(4), Penal Code, is amended to read
  as follows:
               (4)  "Person" means an individual or a[,] corporation,
  [or] association, limited liability company, or other entity or
  organization governed by the Business Organizations Code.
         SECTION 5.  Section 32.43(e), Penal Code, is amended to read
  as follows:
         (e)  In lieu of a fine that is authorized by Subsection (d),
  and in addition to the imprisonment that is authorized by that
  subsection, if the court finds that an individual who is a fiduciary
  gained a benefit through the commission of an offense under
  Subsection (b), the court may sentence the individual to pay a fine
  in an amount fixed by the court, not to exceed double the value of
  the benefit gained.  This subsection does not affect the
  application of Section 12.51(c) to an offense under this section
  committed by a corporation, an [or] association, a limited
  liability company, or another business entity, as defined by
  Section 7.21.
         SECTION 6.  The changes in law made by this Act apply only to
  an offense committed on or after the effective date of this Act. An
  offense committed before the effective date of this Act is governed
  by the law in effect on the date the offense was committed, and the
  former law is continued in effect for that purpose. For purposes of
  this section, an offense was committed before the effective date of
  this Act if any element of the offense was committed before that
  date.
         SECTION 7.  This Act takes effect September 1, 2019.