                                                                                          ACCEPTED
                                                                                      03-15-00386-CV
                                                                                              7537320
                                                                           THIRD COURT OF APPEALS
                                                                                      AUSTIN, TEXAS
                                                                                10/26/2015 1:23:41 PM
                                                                                    JEFFREY D. KYLE
                                                                                               CLERK




             No. 03-15-00386-CV                                    FILED IN
                                                            3rd COURT OF APPEALS
                                                                 AUSTIN, TEXAS
                                                            10/26/2015 1:23:41 PM
                                                                JEFFREY D. KYLE
                                                                     Clerk




               H ARRIS C OUNTY H OSPITAL D ISTRICT ,
                                                     Appellant,
                                    v.

              P UBLIC U TILITY C OMMISSION OF T EXAS ,
                                                     Appellee.



                           B RIEF OF A PPELLEE
                    Public Utility Commission of Texas


By its Attorneys:

KEN PAXTON                          ELIZABETH R. B. STERLING
Attorney General of Texas           Assistant Attorney General
                                    State Bar No. 19171100
CHARLES E. ROY                      elizabeth.sterling@texasattorneygeneral.gov
First Assistant Attorney General
                                    Environmental Protection
JAMES E. DAVIS                      Division
Deputy Attorney General for         P.O. Box 12548, MC-066
Civil Litigation                    Austin, Texas 78711-2548
                                    512.463.2012
PRISCILLA M. HUBENAK                512.457.4616 (fax)
Chief, Environmental Protection
Division

                                                             October 26, 2015
                                            Table of Contents

Table of Contents. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . i

Index of Authorities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . iii

Glossary.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . v

Statement of the Case. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . vi

Statement Regarding Oral Argument. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . vi

Issue Presented. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . vi

         On remand, did the trial court properly sign a judgment without
         Section 15.003 fees?.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . vi

Statement of Facts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

Summary of the Argument. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Argument. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

The trial court properly granted final judgment without conducting any
hearing on the District’s Section 15.003 request for fees.. . . . . . . . . . . . . . . 6

         A.       The District never requested a hearing until after the final
                  judgment was signed.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

         B.       This Court’s mandate did not require the trial court to
                  conduct any § 15.003 fees hearing.. . . . . . . . . . . . . . . . . . . . . . . 8

         C.       This Court’s opinion declined the District’s request for
                  Section 15.003 fees.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

                  1.        The District failed to assign the fees issue as error in
                            its first appeal.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

                  2.        The District misinterprets Footnote 6 in the Court’s
                            first opinion.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

                                                            i
                  3.        Section 15.003 does not authorize payment of fees
                            to the District for attorneys and experts in this case... . . 15

                            a.       The District’s proceeding at the Commission
                                     does not fit within the terms of Section
                                     15.003... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

                            b.       The District cannot be awarded attorney’s fees
                                     and costs because the Legislature has neither
                                     created a regulation fund nor appropriated
                                     money for such a fund and has not waived the
                                     Commission’s immunity... . . . . . . . . . . . . . . . . . . . . 16

Prayer. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18

Certificate of Compliance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

Certificate of Service. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

APPENDICES

         Judgment of the Trial Court. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A

         Mandate from this Court in Docket No. 03-10-00647-CV. . . . . . .                                           B

         Judgment of this Court in Docket No. 03-10-00647-CV.. . . . . . . . . C




                                                            ii
                                         Index of Authorities

Cases                                                                                                         Pages

Fed. Sign v. Tex. S. Univ.,
      951 S.W.2d 401 (Tex. 1997).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18

Ford Motor Co. v. Butnaru,
     157 S.W.3d 142 (Tex. App.—Austin 2005, no pet.. . . . . . . . . . . . . . 14

Harris Cnty. Hosp. Dist. v. Pub. Util. Comm’n,
     2012 WL 2989228 (Tex. App.—Austin July 13, 2012, no pet.)
     (mem. op., not designated for publication).. . . . . . . . . . . . . v, 1, 3, 13

Jay Petroleum, L.L.C. v. EOG Resources, Inc.,
     332 S.W.3d 534 (Tex. App.—Houston [1st Dist.] 2009, pet. denied)
     . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9, 10

Montgomery v. Blue Cross & Blue Shield of Tex., Inc.,
    923 S.W.2d 147 (Tex. App.—Austin 1996, writ denied). . . . . . . . . . 10

State v. Anderson Courier Serv.,
      222 S.W.3d 62 (Tex. App.—Austin 2005, pet. denied). . . . . . . 12, 13

Sw. Galvanizing, Inc. v. Eagle Fabricators, Inc.,
     447 S.W.3d 473 (Tex. App.—Houston [14th Dist.] 2014, no pet.)
     . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

Tex. Educ. Agency v. Maxwell,
      937 S.W.2d 621 (Tex. App.—Eastland 1997, writ denied). . . . . . . . 12

V-F Petroleum, Inc. v. A. K. Guthrie Operating Co.,
     792 S.W.2d 508 (Tex. App.—Austin 1990, no writ). . . . . . . . . . . . . . 9

Valadez v. Avitia,
     238 S.W.3d 843 (Tex. App.—El Paso 2007, no pet.). . . . . . . . .                                        11, 13

Whitmire v. Greenridge Place Apartments,
    333 S.W.3d 255 (Tex. App.—Houston [1st Dist.] 2010, pet. dism’d)
    ......................................................... 9

                                                          iii
                               Index of Authorities (Cont’d)

                                                                                                         Pages
Statutes

Tex. Gov’t Code
      § 2001.174(2). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
      §§ 2251.001-.055. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . v, 1
      §§ 2260.001-.008.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18

Tex. Util. Code
      § 15.003.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . v, 1, 16, 18
      § 15.003(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5, 14, 15
      § 39.903. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
      § 39.903(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
      § 39.903(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
      § 39.903(d)-(l). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
      § 56.021. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
      §§ 11.01-66.016. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . v
      §§ 56.001-.301. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

Other

        Tex. H.B. 1, 84th Leg., R.S. (2015). . . . . . . . . . . . . . . . . . . . . . . . . . . 18




                                                        iv
                                 Glossary

ALJ                          Administrative Law Judge at the State Office
                             of Administrative Hearings

Commission                   Public Utility Commission of Texas

Court’s first opinion        Harris Cnty. Hosp. Dist. v. Pub. Util.
                             Comm’n, No. 03-10-00647-CV, 2012 WL
                             2989228 (Tex. App.—Austin July 13, 2012, no
                             pet.) (mem. op. not designated for
                             publication).

District                     Harris County Hospital District

Docket 34332 Record          Administrative Record of Docket, which may
                             be found among the items listed at
                             http://interchange.puc.state.tx.us/WebApp/I
                             nterchange/application/dbapps/filings/pgCo
                             ntrol.asp?TXT_UTILITY_TYPE=A&TXT_CN
                             TRL_NO=34332&TXT_ITEM_MATCH=1&T
                             XT_ITEM_NO=&TXT_N_UTILITY=&TXT_
                             N_FILE_PARTY=&TXT_DOC_TYPE=ALL&
                             TXT_D_FROM=&TXT_D_TO=&TXT_NEW
                             =true

Footnote 6                   Harris Cnty. Hosp. Dist., 2012 WL 2989228
                             at *7 n.6.

Prompt Payment Act           Tex. Gov’t Code §§ 2251.001–.055

Public Utility Regulatory Act Tex. Util. Code §§ 11.01–66.016

Section 15.003               Tex. Util. Code § 15.003.




                                     v
                         Statement of the Case

   This appeal comes after remand to the trial court in an administrative

appeal of a complaint decided by the Public Utility Commission of Texas.

The Commission agreed that this Court’s mandate requires the case to be

remanded to the Commission, but disagreed that the trial court was

required to grant the Harris County Hospital District fees for attorneys and

experts based on Section 15.003 of the Utilities Code.



                Statement Regarding Oral Argument

   The Commission doubts that oral argument would be helpful to the

Court in this case and, thus, has not requested it. But the District requested

oral argument and, should the Court decide that it wants oral argument, the

Commission asks to participate.



                             Issue Presented

         On remand, did the trial court properly sign a judgment
         without Section 15.003 fees?




                                      vi
                               Statement of Facts

   The Harris County Hospital District continues to seek fees for attorneys

and experts from the “regulation fund,” which the Legislature has never

created or funded in the 40 years since the language was included in the

Public Utility Regulatory Act. See Tex. Util. Code § 15.003.

   This appeal concerns a complaint that the District filed with the Public

Utility Commission eight years ago about overbilling by Southwestern Bell

Telephone, LP d/b/a AT&T Texas (AT&T) going back to twenty years ago.

Harris Cnty. Hosp. Dist. v. Pub. Util. Comm’n, No. 03-10-00647-CV, 2012

WL 2989228 at *1 (Tex. App.—Austin July 13, 2012, no pet.) (mem. op. not

designated for publication). The District complained that AT&T had

applied the terms of AT&T’s tariff to determine late charges rather than

applying the more generous terms of the Prompt Payment Act, Tex. Gov’t

Code §§ 2251.001-.055, to the District, a governmental entity.1




      1
            Tex. Pub. Util. Comm’n, Complaint of Harris County Hospital District
Against AT&T Texas, Docket No. 34332, available at
http://interchange.puc.state.tx.us/WebApp/Interchange/Documents/34332_1_551225.
PDF (May 23, 2007 ) (District’s Complaint) (“Complainant is not ‘exempt’ from late
fees, rather AT&T may only apply late fee as allowed by § 2251.”) This is part of the
administrative record in this case and subsequent citations will be to “Docket 34332
A.R.” After this Court issued its judgment and mandate, the Clerk of the Court asked the
Commission to pick up the administrative record. Anticipating that the matter would be
remanded to the Commission, the administrative record was returned to the agency.
Thus, it is no longer with the court.

                                           1
   The Commission agreed with the District that AT&T should have billed

the District using the terms of the Prompt Payment Act rather than the

late-payment provisions of its tariff.2 The Commission determined that the

Prompt Payment Act and the Public Utility Regulatory Act were in conflict,

but that the Prompt Payment Act controlled.3 Given the District’s delay in

bringing the case, however, the Commission awarded only one-half of the

overcollected amounts. The District appealed to a trial court in Travis

County, Texas. In that suit for judicial review, the District also asked to

recover its fees for attorneys and experts under Section 15.003 of the Texas

Utilities Code, a provision that has been in the Public Utility Regulatory Act

since it was first adopted in 1975, but which has never been implemented or

funded by the Legislature. The trial court affirmed the Commission’s order

and made no mention of the Section 15.003 request.

   On appeal to this Court, the District included a Section 15.003 request

for fees in the prayer of its appellant’s brief, but the brief contained no issue




      2
          Docket 34332 A.R. (July 16, 2008) (Order Denying Appeal of Order No. 19)
available at
http://interchange.puc.state.tx.us/WebApp/Interchange/Documents/34332_162_5898
71.PDF.
      3
          Id. (“PURA § 58.152’s broad grant of pricing flexibility regarding late fees
cannot be read in harmony with the [Prompt Payment Act]’s precise methodology for
handling such fees.”).

                                            2
nor any argument or authority supporting that request.4 Although the

District appeared to have waived any claim by its lack of an issue or

argument and authorities, in an abundance of caution, the Commission

included in its appellee’s brief several arguments against such a request.5

But the District’s reply brief included no response.6 Thus, neither of the

District’s briefs included any issue or argument and authorities to support a

Section 15.003 request for fees.

   This Court’s opinion held that the Commission was arbitrary and

capricious to limit the refund to one-half of the overcharges. Harris Cnty.

Hosp. Dist., 2012 WL 2989228 at *8. The opinion addressed Section

15.003 only in its Footnote 6, stating: “To the extent that the District seeks

to have this Court order the Commission to adopt the ALJ’s proposal for

decision and to award it expert’s fees and attorney’s fees, we decline to do

so.” Id. at *7 n.6 (citations omitted).




      4
         Brief of the Appellant Harris County Hospital District at 43, Harris Cnty.
Hosp. Dist. v. Pub. Util. Comm’n, No. 03-10-00647-CV (Mar. 7, 2011).
      5
         Brief of the Appellee at 42-44, Harris Cnty. Hosp. Dist. v. Pub. Util. Comm’n,
No. 03-10-00647-CV (May 13, 2011).
      6
         Appellant Harris County Hospital District’s Reply to Brief of Appellee, Harris
Cnty. Hosp. Dist. v. Pub. Util. Comm’n, No. 03-10-00647-CV (Jun. 9, 2011).

                                           3
   The Court’s mandate7 reversed the trial court’s judgment, and remanded

the cause to the trial court “with instructions that the case be remanded to

the Commission for further proceedings consistent with this opinion.”

Although the mandate orders the Commission to pay court costs, there is

no order about Section 15.003 fees for attorneys and experts. The

judgment of the Court contains the same language.8

   After remand, the trial court took no action for two years. Then the

District filed two motions: 1) a motion to sever its claims for attorney and

expert fees and costs and to abate the severed claim;9 and 2) a motion to

remand overbilling claims to the Commission.10

   The Commission agreed with the District that the administrative appeal

should be remanded to the Commission, but disagreed about the form of

order the trial court should sign.11 The Commission maintained that the

      7
          The mandate states:
      IT IS THEREFORE considered, adjudged and ordered that the judgment
      of the trial court is reversed, and that the cause is remanded to the trial
      court with instructions that the case be remanded to the Commission for
      further proceedings consistent with this opinion. It is FURTHER ordered
      that the appellee pay all costs relating to this appeal, both in this Court and
      the court below; and that this decision be certified below for observance.
      C.R. at 87.
      8
        Judgment Rendered July 13, 2012, Harris Cnty. Hosp. Dist. v. Pub. Util.
Comm’n, No. 03-10.00647-CV.
      9
           C.R. at 114.
      10
           Id. at 90.
      11
           Id. at 123.

                                            4
remand had to be a final judgment, not an interlocutory order. As to the

motion to sever, the Commission opposed the District’s motion to sever its

claim for attorney’s fees under Section 15.003 of the Utilities Code. In

addition to the Commission’s claims that the Section 15.003 claim was

extinguished when this Court declined to grant the request, the

Commission noted that, because Section 15.003 requires any fees to be

awarded “in the same action,” Tex. Util. Code § 15.003(a), the fee request

could not be severed.

   The trial court denied the motion to sever and signed a final judgment

remanding the matter to the Commission.12 The District appeals that

judgment.

                          Summary of the Argument

   For several independent reasons, the trial court properly signed a final

judgment remanding this case to the Commission without any hearing on

Section 15.003 fees. The District did not ask the trial court to set fees on

remand; instead, the District asked the trial court to sever and abate that

request. More importantly, this Court’s mandate in the prior appeal did

not authorize the trial court to consider Section 15.003 fees. Instead, the




      12
           C.R. at 149.

                                       5
judgment and mandate ordered the trial court to remand the matter to the

Commission—exactly what the trial court did.

   Additionally, the District has no claim for Section 15.003 fees. That

statute purports to allow certain parties to recover fees “against the

regulation fund,” but in the 40 years since the Legislature enacted the

statute, the “regulation fund” has been neither created nor funded.

   Even if such a fund existed, the District’s claim would not fit within its

terms. The District was not alleging that AT&T’s rates were unreasonable,

but that, for a governmental entity like the District, the reasonable fees set

by the Commission were superceded by a different statute—the Prompt

Payment Act.

                                  Argument

The trial court properly granted final judgment without
conducting any hearing on the District’s Section 15.003 request
for fees.

   A. The District never requested a hearing until after the final
      judgment was signed.

   After this Court remanded the matter to the trial court, the District filed

two motions, but neither of them requested a hearing on its Section 15.003

request for fees. Instead, the District asked the trial court to sever13 its



      13
           C.R. at 114.

                                        6
request into a different cause while remanding14 the administrative appeal

to the Commission. The Commission agreed that the matter needed to be

remanded, but argued that the remand should be part of a final judgment

and that no severance should be granted.15 After a hearing on the District’s

two motions, the trial court signed a final judgment remanding the case to

the Commission and denying the District’s motion to sever.16

   It was only after the trial court signed a final judgment that the District

asked the trial court to conduct a hearing on its Section 15.003 request for

fees, and then the request was conditioned on the trial court granting the

District’s motion for new trial.17

   The District cannot complain that the trial court never conducted a

Section 15.003 hearing when the District failed to timely request such a

hearing.




      14
           Id. at 90.
      15
           Id. at 123.
      16
           Id. at 148.
      17
           C.R. at 151.

                                       7
   B. This Court’s mandate did not require the trial court to
      conduct any § 15.003 fees hearing.

   Section 15.003 fees were beyond the scope of this Court’s mandate in the

prior appeal; the trial court had no authority to consider the issue on

remand.

   This Court’s mandate authorized the trial court only to remand the

matter to the Commission for consideration in light of the Court’s opinion.

The mandate states:

   THIS CAUSE came on to be heard on the record of the court below,
   and the same being considered, because it is the opinion of this Court
   that there was error in the trial court’s judgment: IT IS
   THEREFORE considered, adjudged and ordered that the judgment
   of the trial court is reversed, and that the cause is remanded to the
   trial court with instructions that the case be remanded to the
   Commission for further proceedings consistent with this opinion. It is
   FURTHER ordered that the appellee pay all costs relating to this
   appeal, both in this Court and the court below; and that this decision
   be certified below for observance.

   Wherefore, we command you to observe the order of our Court of
   Appeals in this behalf and in all things have the order duly
   recognized, obeyed, and executed.18

   The only matter referenced in this Court’s mandate is that the trial court

remand the case to the Commission “for further proceedings consistent

with this opinion.” There is no mention of any claim for fees. Thus,

conducting a hearing on Section 15.003 fees was beyond the trial court’s


      18
           C.R. at 87.

                                      8
authority because it was beyond the scope of the mandate. “[W]hen a case

is remanded to the district court with instructions, that court’s authority is

limited to trying only those issues specified in the appellate court

mandate.” V–F Petroleum, Inc. v. A. K. Guthrie Operating Co., 792 S.W.2d

508, 510 (Tex. App.—Austin 1990, no writ.). The trial court “has no

jurisdiction to review, interpret, or enforce [the appellate court’s] mandate;

it must observe and carry it out. Its orders carrying out the mandate are

ministerial.” Whitmire v. Greenridge Place Apartments, 333 S.W.3d 255,

261 (Tex. App.—Houston [1st Dist.] 2010, pet. dism’d)(citing Schliemann

v. Garcia, 685 S.W.2d 690, 692 (Tex. App.—San Antonio 1984, orig.

proceeding)). The trial court would have violated this Court’s mandate had

it taken up the issue of Section 15.003 fees.

   Contrary to the District’s brief (District’s Appellant’s Br. at 10), this case

is not similar to the procedural circumstances in Jay Petroleum, L.L.C. v.

EOG Resources, Inc., 332 S.W.3d 534, 540 (Tex. App.—Houston [1st Dist.]

2009, pet. denied). That case turned on procedural rules concerning a

summary judgment—rules that do not apply to this administrative appeal.

   An administrative appeal raises legal questions about the agency’s final

order. Ultimately, the agency must issue a new order when a remand is

required. But a summary judgment is different. Because it removes all or


                                        9
part of a cause of action from a decision by the fact finder, reversing a

summary judgment may merely mean that the cause of action or part of it

must be decided by the fact finder—either the jury or the trial court itself.

Cases where the appellate court can render judgment after reversing a

summary judgment are limited. As this Court explained, “[b]efore an

appellate court may reverse summary judgment for one party and render

judgment for the other party, all parties must have sought final judgment

relief in their cross-motions for summary judgment.” Montgomery v. Blue

Cross & Blue Shield of Tex., Inc., 923 S.W.2d 147, 152 (Tex. App.—Austin

1996, writ denied).

   Attorney’s fees were an issue on remand in Jay Petroleum because the

lack of a cross motion on all claims made one party’s causes of action live

on remand after the Houston Court of Appeals reversed summary

judgments. Jay Petroleum, 332 S.W.3d at 540 (“The mandate plainly

reversed the [defensive] summary judgment on the counterclaims, which

necessarily made those counterclaims live.”).

   Because this case is not a summary judgment, no cause of action became

live on remand. All the trial court needed to do was to take the ministerial

action of signing a final judgment that remanded the case to the

Commission for further proceedings consistent with this Court’s opinion.


                                      10
   Another case cited by the District is even farther from the facts of this

case. The appellant in Southwest Galvanizing was awarded attorney’s fees

in its initial appeal. Sw. Galvanizing, Inc. v. Eagle Fabricators, Inc., 447

S.W.3d 473, 478 (Tex. App.—Houston [14th Dist.] 2014, no pet.). Thus, on

remand the trial court had no option but to award attorney’s fees.

   C. This Court’s opinion declined the District’s request for
      Section 15.003 fees.

      1. The District failed to assign the fees issue as error in its
         first appeal.

   Because the District neither listed nor briefed a request for Section

15.003 fees in its initial appeal, it waived those issues. See Valadez v.

Avitia, 238 S.W.3d 843, 844–45 (Tex. App.—El Paso 2007, no pet.)

(finding waiver of issues that were neither listed nor briefed).

   Although the District included a request for Section 15.003 fees in the

prayer of its appellant’s brief in the first appeal, it failed to include an issue

or any briefing to support that prayer.19 But, because Section 15.003 was in

the District’s prayer,20 the Commission’s appellee’s brief included

arguments as to why the District was not entitled to recover Section 15.003

fees. Even in the face of the Commission’s briefing on the matter, the


      19
         Brief of the Appellant Harris County Hospital District at 43, Harris Cnty.
Hosp. Dist. v. Pub. Util. Comm’n, No. 03-10-00647-CV (Mar. 7, 2011).
      20
           Id. at 44.

                                          11
District failed to address any of those arguments in its reply brief.21 Thus,

there was a total failure by the District to brief the issue.

   This stands in contrast to the facts in Texas Education Agency v.

Maxwell, 937 S.W.2d 621, 623 (Tex. App.—Eastland 1997, writ denied).

There, the appellees preserved their request for attorney’s fees by a cross-

point. But here, the District failed to preserve any Section 15.003 issue in

its first appeal.

   A more analogous case is State v. Anderson Courier Service, 222

S.W.3d 62 (Tex. App.—Austin 2005, pet. denied), where this Court refused

to allow attorney’s fees on remand. Although Anderson Courier arose as a

declaratory judgment action attacking the constitutionality of a statute, the

lack of a fee issue on appeal is analogous to this case.

   In Anderson Courier, the trial court initially held the statute

constitutional. But on appeal this Court held the statute unconstitutional

and remanded to the trial court. Anderson Courier, which had lost in the

trial court, did not address the question of attorney’s fees in its initial

appeal, but requested them on remand. When the remand decision was

appealed, this Court noted that although Anderson Courier had requested

attorney’s fees at the initial trial, because the issue was not raised on

      21
         Appellant Harris County Hospital District’s Reply to Brief of Appellee, Harris
Cnty. Hosp. Dist. v. Pub. Util. Comm’n, No. 03-10-00647-CV (Jun. 9, 2011).

                                          12
appeal, there was no reason for this Court to remand the attorneys fees

question to the trial court. Id. at 66.

   Although the Court is dealing with a different statute in this case, the

fact that the District did not support its prayer for Section 15.003 fees in

the first appeal with an issue and argument is reason enough for the Court

to have declined the request. See Valadez v. Avitia, 238 S.W.3d at 844–45

(finding waiver of issues that were neither listed nor briefed).

      2. The District misinterprets Footnote 6 in the Court’s first
         opinion.

   Footnote 6 in the Court’s prior opinion does not support a holding that

the Section 15.003 fees issue was remanded to the trial court. Only part of

the footnote concerns Section 15.003 because the footnote addresses two

distinct requests the District made in its prior appeal: 1) that this Court

order the Commission to adopt the administrative law judge’s proposal for

decision without change;22 and 2) that the Court award fees for the

District’s attorneys and experts under Section 15.003.23 Regarding the

issue on appeal, the footnote states: “To the extent that the District seeks

to have this Court … award it expert’s fees and attorney’s fees, we decline to

do so.” Harris Cnty. Hosp. Dist., 2012 WL 2989228 at *7 n.6. Although


      22
           C.R. 114.
      23
           C.R. at 90.

                                          13
the Court cited several authorities for this sentence, the first two citations

do not apply to Section 15.003.

   Instead, they concerned the District’s request that the Court order the

Commission to adopt the ALJ’s proposal for decision:

1. Texas Government Code § 2001.174(2), which states that the court “shall

   reverse or remand the case for further proceedings if substantial rights

   of the appellant have been prejudiced because the administrative

   findings, inferences, conclusions, or decisions” violate any of six

   requirements.

2. Ford Motor Co. v. Butnaru, 157 S.W.3d 142, 149 (Tex. App.—Austin

   2005, no pet.) cited for the proposition that: “In a suit for judicial

   review of an agency action, the reviewing court is empowered to issue

   only a general remand when it finds error that prejudices an appellant’s

   substantial rights.”

Both of these apply only to actions of the Commission. But as the District

admits, Utilities Code Section 15.003(b) directs the court, not the

Commission, to determine fees, and to award them against the “regulation

fund.” Tex. Util. Code § 15.003(a).

   The only citation in the Court’s Footnote 6 that applies to Section 15.003

is that statute itself. Given that the District made no arguments about the


                                       14
applicability of Section 15.003 and that the Commission explained in its

brief why that statute did not apply, a citation to the statute supports the

conclusion that this Court was not remanding the case to the trial court for

a Section 15.003 fee decision.

   But the most persuasive indication of this Court’s intent is the lack of a

remand of the Section 15.003 claims. Had the Court intended that Section

15.003 fees be addressed on remand, it would surely have said so in its

opinion, judgment, and mandate.

      3. Section 15.003 does not authorize payment of fees to the
         District for attorneys and experts in this case.

           a. The District’s proceeding at the Commission does not
              fit within the terms of Section 15.003.

   The District’s case does not come within the plain language of any right

to recover fees under Section 15.003(a) of the Utilities Code. It applies to

“[a] party represented by counsel who alleges that existing rates are

excessive or that rates prescribed by the commission are excessive,” Tex.

Util. Code § 15.003(a), but nowhere in District’s the complaint did it assert

that AT&T’s existing rates were excessive or that they should be changed.24

In fact, by the District’s own admission, its complaint had nothing at all to


      24
           Docket 34332 A.R. (May 23, 2007) (Complaint of Harris County Hospital
District Against AY&T Texas) available at
http://interchange.puc.state.tx.us/WebApp/Interchange/Documents/34332_1_551225.
PDF.

                                      15
do with AT&T’s tariffed rates.25 And, in granting the District’s complaint,

the Commission did not determine that AT&T’s rate schedules required

amendment or were otherwise unreasonable. The Commission simply

agreed with the District that the Prompt Payment Act prevailed over the

Public Utility Regulatory Act and limited amounts the District owed for late

payments.26 The plain language of Section 15.003(a) does not authorize

recovery of fees and costs in this case.

            b. The District cannot be awarded attorney’s fees and
               costs because the Legislature has neither created a
               regulation fund nor appropriated money for such a
               fund and has not waived the Commission’s immunity.

   Even had the District not waived any Section 15.003 right and the Court

not already decided against the District’s Section 15.003 issue, the District

still could not obtain the relief it requests because the Legislature has never

established a regulation fund. See Tex. Util. Code § 15.003 revisor’s note




       25
           Id. at p. 4 of 10 (“Complainant is not subject to AT&T’s late fees under its
tariff because Texas law prescribes another late fee structure for all Political
Subdivisions.”).
       26
           Docket 34332 A.R. (July 16, 2008) (Order Denying Appeal of Order No. 19)
available at
http://interchange.puc.state.tx.us/WebApp/Interchange/Documents/34332_162_5898
71.PDF.


                                             16
(stating “Although the regulation fund does not exist, the revised law

retains the reference to retain whatever meaning it may have.”).27

   Section 15.003 of the Utilities Code mentions a “regulation fund,” but no

statute creates such a fund. This stands in stark contrast to other funds

associated with the Commission. For example, all of Subchapter 56 of the

Public Utility Regulatory Act is devoted to the universal service fund. Tex.

Util. Code §§ 56.001–.301. Section 56.021 establishes that fund. And the

system benefit fund is established by Utilities Code Section 39.903. It

describes the system benefit fund at length, including the statement that it

“is an account in the general revenue fund.” Tex. Util. Code § 39.903(a).

Section 39.903 also describes the source of the system benefit fund28 and

how it is to be administered and used.29 Clearly the Legislature knows how

to create a fund. But no such creation language exists for the “regulation

fund.”




       27
           The revisor’s note was added when the Public Utilities Regulatory Act was
codified as part of the Utilities Code. 97 Laws, 75th R.S., ch. 166, § 1, 1997 Tex. Gen.
Laws 713–1018.
       28
         Tex. Util. Code § 39.903(b) (“The system benefit fund is financed by a
nonbypassable fee set by the commission in an amount not to exceed 65 cents per
megawatt hour. The system benefit fund fee is allocated to customers based on the
amount of kilowatt hours used.”).
       29
            Id. at § 39.903(d)–(l).

                                             17
   In addition to the lack of legislation creating the fund, it has never been

funded by the Legislature. See Tex. H.B. 1, 84th Leg., R.S. (2015) (current

appropriations bill without any “regulation fund”); see also Tex. Util. Code

§ 15.003 revisor’s note (stating “Although the regulation fund does not

exist, the revised law retains the reference to retain whatever meaning it

may have.”).

   Because the regulation fund does not exist, and because the

Legislature has not appropriated any money for use in that fund, the

District cannot demonstrate the requisite consent by the State to be subject

to liability, and any claim is thus barred by sovereign immunity. See Fed.

Sign v. Tex. S. Univ., 951 S.W.2d 401, 414 (Tex. 1997), superseded by

statute on other grounds, Tex. Gov’t Code § 2260.001-.008 (J. Hecht

concurring) (recognizing that absence of legislative appropriation is fatal to

suit against the State, even where the Legislature may have waived

sovereign immunity from suit.)

                                   Prayer

   The Commission asks the Court to affirm the district court’s judgment.

The Commission asks the Court for such other relief as it may be entitled.




                                      18
Respectfully submitted,

KEN PAXTON
Attorney General of Texas

CHARLES E. ROY
First Assistant Attorney General

JAMES E. DAVIS
Deputy Attorney General for Civil Litigation

PRISCILLA M. HUBENAK
Division Chief
Environmental Protection Division

/s/ Elizabeth R. B. Sterling
Elizabeth R. B. Sterling
Assistant Attorney General
Texas State Bar No. 19171100
elizabeth.sterling@texasattorneygeneral.gov

Environmental Protection Division
Office of the Attorney General
P.O. Box 12548, MC-066
Austin, Texas 78711-2548
512.463.2012
512.457.4616 (fax)

COUNSEL FOR PUBLIC UTILITY
COMMISSION OF TEXAS




      19
                     Certificate of Compliance

     I certify that the foregoing computer-generated document has 4,003
words, calculated using the computer program WordPerfect 12, pursuant to
Texas Rule of Appellate Procedure 9.4.

                                 /s/ Elizabeth R. B. Sterling
                                 Elizabeth R. B. Sterling




                                   20
                         Certificate of Service

      I hereby certify that on this the 26th day of October 2015, a true and
correct copy of the foregoing document was served on the following counsel
electronically, through an electronic filing service and by email:


                                          /s/ Elizabeth R. B. Sterling
                                          Elizabeth R. B. Sterling


Bruce S. Powers
Harris County Assistant County Attorney
1019 Congress, 15th Floor
Houston, Texas 77002
713.274.5144
713.755.8924 (fax)
bruce.powers@cao.hctx.net

ATTORNEYS FOR HARRIS COUNTY HOSPITAL DISTRICT

                                          /s/ Elizabeth R. B. Sterling
                                          Elizabeth R. B. Sterling




                                     21
APPENDIX A
                                                                   Filed in The District Court
                                                                    of Travis County, Texas

                                                                        MAR 27 2015            €!;>
                                                                   At       q·.sj A-           M.
                          CAUSE NO. D-1-GN-09-002116               Velva L. Price, District Clerk

HARRIS COUNTY HOSPITAL                    §     IN THE DISTRICT COURT
DISTRICT,                                 §
     Plaintiff,                           §
                                          §
v..                                       §     OF TRAVIS COUNTY, TEXAS
                                          §
PUBLIC UTILI1Y COMMISSION                 §
OF TEXAS,                                 §
     Defendant.                           §     25oth JUDICIAL DISTRICT


                               FINAL .JUDGMENT

      On ,J anua1y 22 , 2015, the Court considered two motions filed by the Harris

County Hospital District (District): 1) Motion for Order Remanding Overbilling

Claims lo Lhe Public Utility Commission of Texas and 2) Motion to Sever Claims

for Attorney and Expert Fees and Costs and lo Abale the Severed Claims. All

parties appeared through counsel. The Court, having considered the briefs, the

pleadings, the argumenl of counsel, and the opinion, judgment, and mandate of

the Court of Appeals for the Third District of Texas sitling in Austin, herehy

denies the motion to Sever Claims for Attorney and Expert Fees and Costs and to

Abate the Severed Claims. The Court further orders that the Commission's

Docket 34332, Complaint ofHarris County Hospital District Against Sw. Bell

Telephone, LP d/b/a AT&T Texas, be remanded to the Commission for

proceedings in accord \'\~th the opinion and judgment of the Court of Appeals for

the Third District of Texas.

      Although this Court previously affirmed the Commission's Docket 34332

final order, the Anstin Court of Appeals reversed that decision in Harris County
Hospital District v. Public Utility Commission,   2012   WL 2989228 (Tex.

App.-Austin 2012, no pet.) (mem. op., not designated for publication).

      The Court finds that, although the Court of Appeals reversed this Courfs

judgment affirming the Commission's order, the Court of Appeals declined the

District's claims under Texas Utilities Code§ 15.003 for attorneys and expert

witnesses and other costs for the pa1ty's efforts before the Commission and the

court. Therefore, the Court denies the District's request to sever that claim into a

different lawsuit.

      IT IS THEREFORE ORDERED, ADJUDGED, AND DECREED that the

Hospital District's Motion to Sever Claims for Attorney and Expert Fees and Costs

and to Abate the Severed Claims is denied.

      IT IS FURTHER THEREFORE ORDERED, ADJUDGED, AND DECREED

that the Final Order of the Public Utility Commission in Docket 34332 is

REVERSED and remanded to the Commission for further proceedings consistent

with the opinion of the Austin Court of Appeals in this case.

      IT IS FURTHER ORDERED that, in accord with the Court of Appeals'

mandate, the Public Utility Commission of Texas pay all costs relating to the

appeal, both in the Court of Appeals and in this Court. All relief not specifically

granted herein is denied. This judgment is final, disposes of all claims and all

parties, and is appealable.




                                          2
Eli eth R. B. Sterling
Assistant Attorney General
Attorneys for the Public Utility Commission of Texas


Approved as to Form Only

   \~-R~~tS
Thomas R. Bray
Attorneys for Harris County Hospital District




                                        3
APPENDIX B
                                                  MANDATE
THE STATE OF TEXAS

TO THE 250TH DISTRICT COURT OF TRAVIS COUNTY, GREETINGS:

Trial Court Cause No. D-l-GN-09-002116

       Before our Court of Appeals for the Third District of Texas on July 13, 2012, the cause
on appeal to revise or reverse your judgment between

                                         Harris County Hospital District

No. 03-10-00647-CV                       v.

                                         The Public Utility Commission of Texas

Was determined, and therein our Court of Appeals made its order in these words



THIS CAUSE came on to be heard on the record of the court below, and the same being
considered, because it is the opinion of this Court that there was error in the trial court's
judgment: IT IS THEREFORE considered, adjudged and ordered that the judgment of the trial
court is reversed, and that the cause is remanded to the trial court with instructions that the case
be remanded to the Commission for further proceedings consistent with this opinion. It is
FURTHER ordered that the appellee pay all costs relating to this appeal, both in this Court and
the court below; and that this decision be certified below for observance.

Wherefore, we command you to observe the order of our Court of Appeals in this behalf and in
all things have the order duly recognized, obeyed, and executed.


                                                      Witness the Honorable J. Woodfin Jones, Chief
                                                      Justice of the Court of Appeals for the Third District
                                                      of Texas, with the seal of the Court affixed in the City
                                                      of Austin on Friday, September 28, 2012.

                                                      JEFFREY D. KYLE, CLERK
                       ,.   .
                            ;   -{   :


                       .·                             By:~~~~+-+-~~~~---~
   --~ ........ .
      !         -').
                                                         Amy Strother
     <    :'D      J
                                                            BILL OF COSTS

                      TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN

                                                           No. 03-10-00647-CV

                                                     Harris County Hospital District

                                                                      v.

                                                  The Public Utility Commission of Texas

            (No. D-1-GN-09-002116 IN 250TH DISTRICT COURT OF TRAVIS COUNTY)
Type of Fee                       Charges   Paid       By
SUPREME COURT CHAPTER 51 FEE                               $50.00   PAID           MARKETING ON HOLD
INDIGENT                                                   $25.00   PAID           MARKETIN ON HOLD
FILING                                                    $100.00   PAID           MARKETING ON HOLD
CLERK'S RECORD                                            $529.00   UNKNOWN
REPORTER'S RECORD                                          $75.00   UNKNOWN
SUPPLEMENTAL CLERK'S RECORD                                 $0.00   UNKNOWN
FILING                                                     $10.00   PAID           THOMAS R BRAY
FILING                                                     $10.00   PAID           THOMAS R BRAY ATTORNEY AT LAW
FILING                                                     $10.00   PAID           CHARLES W MCDONALD
FILING                                                     $10.00   PAID           OAG, ELIZABETH STERLING
REQUIRED TEXAS.GOV EFILING FEE                              $4.00   E-PAID         OAG
REQUIRED TEXAS.GOV EFILING FEE                              $4.00   E-PAID         THOMAS R. BRAY
REQUIRED TEXAS.GOV EFILING FEE                              $4.00   E-PAID         THOMAS R. BRAY
REQUIRED TEXAS.GOV EFILING FEE                              $4.00   E-PAID         AG - ENVIRNMNTAL PROTEC & ADMIN
REQUIRED TEXAS.GOV EFILING FEE                              $4.00   E-PAID         BRAY & ASSOCIATES

                       Balance of costs owing to the Third Court of Appeals, Austin, Texas: $0.00


                      Court costs in this cause shall he paid as per the Judgment issued by this Court.


             I, JEFFREY D. KYLE, CLERK OF THE THIRD COURT OF APPEALS OF THE
     STATE OF TEXAS, do hereby certify that the above and foregoing is a true and correct copy of
     the cost bill of THE COURT OF APPEALS FOR THE THIRD DISTRICT OF TEXAS,
     showing the charges and payments, in the above numbered and styled cause, as the same appears
     of record in this office.

                                                                    IN TESTIMONY WHEREOF, witness my hand
                                                                    and the Seal of the COURT OF APPEALS for the
                                                                    Third District of Texas on September 28, 2012.

                                       : -/   :

        '
            "'
            .    I
                     ·...... .   ..
                                  \.
APPENDIX C
       TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN


                         JUDGMENT RENDERED JULY 13, 2012




                                      NO. 03-10-00647-CV



                          Harris County Hospital District, Appellant

                                                v.

                      The Public Utility Commission of Texas, Appellee




        APPEAL FROM THE 250TH DISTRICT COURT OF TRAVIS COUNTY
             BEFORE JUSTICES PURYEAR, ROSE AND GOODWIN
         REVERSED AND REMANDED -- OPINION BY JUSTICE GOODWIN




THIS CAUSE came on to be heard on the record of the court below, and the same being

considered, because it is the opinion of this Court that there was error in the trial court's

judgment: IT IS THEREFORE considered, adjudged and ordered that the judgment of the trial

court is reversed, and that the cause is remanded to the trial court with instructions that the case

be remanded to the Commission for further proceedings consistent with this opinion.            It is

FURTHER ordered that the appellee pay all costs relating to this appeal, both in this Court and

the court below; and that this decision be certified below for observance.
