                                                                                                       ACCEPTED
                                                                                                   03-13-00101-CV
                                                                                                           6067747
                                                                                        THIRD COURT OF APPEALS
                                                                                                   AUSTIN, TEXAS
                                                                                              7/14/2015 6:09:49 PM
                                                                                                 JEFFREY D. KYLE
                                                                                                            CLERK
                                       NO. 03-13-001 01-CV

                               IN THE COURT OF APPEALS
                                                                 FILED IN
                       FOR THE THIRD COURT OF APPEALS DISTRICT
                                                           3rd COURT OF APPEALS
                                     AUSTIN, TEXAS             AUSTIN, TEXAS
                                                                         7/14/2015 6:09:49 PM
                                                                           JEFFREY D. KYLE
                                                                                 Clerk
                                      RENT-A-CENTER, INC.,
                                                      APPELLANT

                                                 V.

                GLEN HEGAR, in his capacity as
   COMPTROLLER OF PUBLIC ACCOUNTS OF THE STATE OF TEXAS;
                            and
                KEN PAXTON, in his capacity as
         ATTORNEY GENERAL OF THE STATE OF TEXAS,

                                                            APPELLEES

                                        On Appeal from the
                                        th
                                     250 Judicial District Court
                                       Travis County, Texas


APPELLANTS                     REPLY IN SUPPORT OF ITS MOTION FOR REHEARING


Daniel L. Butcher                                     Farley P. Katz
State Bar No. 03512050                                State Bar No. 11108790
P. Michael Jung                                       Forrest M. (Teo) Seger III
State Bar No. 11054600                                State Bar No. 24070587
Strasburger & Price, LLP                              Strasburger & Price LLP
901 Main Street, Suite 4300                           2301 Broadway
Dallas, Texas 75202-3794                              San Antonio, Texas 78215
                                                      (210) 250-6000 Telephone
                                                      (210) 250-6100 Facsimile

                                                      ATTORNEYS FOR APPELLANT
                                                      (Additional Counsel on Signature
                                                      Page)

1898612.2/SPSAl67691/0102/071415
                                      TABLE OF CONTENTS

TABLE OF AUTHORITIES                                      ii
ARGUMENT                                                  2
CONCLUSION                                                4
CERTIFICATE OF SERVICE                                    6
CERTIFICATE OF COMPLIANCE                                 6




1898612.2/SPSAl67691/01   02/071415
                                   TABLE OF AUTHORITIES

                                                                         Page(s)
CASES

Bradleys' Elec. v. Cigna Lloyds Ins. Co.,
   995 S.W.2d 675 (Tex. 1999)                                                  2

Chrismon v. Brown,
  246 S.W.3d 102 (Tex. App. - Houston [14th Dist.] 2007, no pet.)              4

Hawkins v. EI Paso First Health Plans, lnc.,
  214 S.W.3d 709 (Tex. App. - Austin 2007, pet. denied)                        4

Q'Carolan v. Hopper,
  414 S.W.3d 288,304 (Tex. App. -                Austin 2013, no pet.)        .4
PUC of Tex. v. City of Harlingen,
  311 S.W.3d 610 (Tex. App. - Austin 2010, no pet.)                            3

RULES

Tex. R. App. P.

   . Rule 43.3                                                              2, 3




                                            ii
1898612.2/SPSAl67691/0102/071415
                                     NO. 03-13-001 01-CV

                               IN THE COURT OF APPEALS
                       FOR THE THIRD COURT OF APPEALS DISTRICT
                                     AUSTIN, TEXAS


                                    RENT-A-CENTER, INC.,
                                                    APPELLANT

                                               V.
                GLEN HEGAR, in his capacity as
   COMPTROLLER OF PUBLIC ACCOUNTS OF THE STATE OF TEXAS;
                            and
                KEN PAXTON, in his capacity as
         ATTORNEY GENERAL OF THE STATE OF TEXAS,

                                                         APPELLEES


                                      On Appeal from the
                                      th
                                   250 Judicial District Court
                                     Travis County, Texas


APPELLANT'S REPLY IN SUPPORT OF ITS MOTION FOR REHEARING


           Appellant Rent-A-Center, Inc. ("Rent-A-Center") respectfully files this

Reply in Support of its Motion for Rehearing.




                                                1
1898612.2/SPSAl67691/0102/071415
                                      ARGUMENT

          Texas Rule of Appellate Procedure 43.3 provides in relevant part that

"[w]hen reversing a trial court's judgment, the court must render the

judgment that the trial court should have rendered, except when ... a

remand is necessary for further proceedings ... "

           Here the trial court ruled against Rent-A-Center as to whether it was

primarily engaged in selling merchandise. As a result, the court did not

reach the second issue, the total cost of goods sold, even though all the

facts relevant to that issue were stipulated and undisputed.

          The Comptroller concedes that the facts relating to cost of goods are

undisputed and that the question presented is purely one of law. See

Petition for Rehearing pp. 4-8 & 7 n. 2. He asserts, however, that in these

circumstances Rule 43.3 nevertheless requires this Court to remand the

case in order to permit the trial court to "address that question in the first

instance." See Appellees' Response in Opposition to Appellant's Motion

for Rehearing p. 2. In other words, the Comptroller argues that Rule 43.3

prohibits an appellate court that has reversed a trial court on an issue from

going on to decide other issues that the trial court did not reach, even

where those remaining issues are purely questions of law.




                                           2
1 898612,2/SPSN67691/01   02/071415
           This turns Rule 43.3 on its head and is contrary to a multitude of

appellate decisions. For example, Bradleys' Elec. v. Cigna Lloyds Ins. Co.,

995 S.W.2d 675 (Tex. 1999), presented the question whether a "court of

appeals erred by remanding [a] case to the trial court without considering

and deciding an issue upon which it could have rendered judgment."           Id. at

676. The Texas Supreme Court held that the remand violated Rule 43.3,

and that the appellate court should have ruled on the issues presented

"that would afford the party the greatest relief." Id. at 677. The Court noted

that the requirements of Rule 43.3 "are mandatory and that courts of

appeals are not at liberty to disregard them." Id.

           Applying this principle, this Court has consistently held that under

Rule 43.3, where it reverses, it will go on to rule on other issues involving

purely legal questions and will not remand those to the trial court. For

example, in PUC of Tex. v. City of Harlingen, 311 S.W.3d 610,625-626

(Tex. App.-Austin                 2010, no pet.), this Court stated:

          "When reversing a trial court's judgment, the court must render the
          judgment that the trial court should have rendered, except when: (a) a
          remand is necessary for further proceedings; or (b) the interests of
          justice require a remand for another trial." Tex. R. App. P. 43.3. Given
          that the issue not decided by the district court is a question of law, we
          consider remand to the district court to be unnecessary, and we will
          rule on the issue so that we may render the judgment that the district
          court should have rendered.



                                                    3
1898612.2/SPSN67691/0102/071415
Similarly, in Hawkins v. EI Paso First Health Plans, tnc., 214 S.W.3d 709,

719-720 (Tex. App.-Austin         2007, pet. denied), this Court explained:

          If reversal is warranted, the material facts are established, and there
          are no further proceedings necessitating a remand, then this Court
          has a duty to render the judgment the trial court should have
          rendered. See Rosen v. Wells Fargo Bank Tex., N.A., 114 S.W.3d
          145, 149 (Tex. App.-Austin 2003, pet. filed); McAllen Police Officer's
          Union v. Tamez, 81 S.W.3d 401,405 (Tex. App.-Corpus Christi
          2002, pet. dism'd) (citing Tex. R. App. P. 43.3); City of Galveston v.
          Giles, 902 S.W.2d 167, 172 (Tex. App.-Houston [1st Dist.] 1995, no
          writ).

           It is only in circumstances where, for example, a party did not have

an "opportunity to present evidence" that remand may be necessary.

O'Carolan v. Hopper, 414 S.W. 3d 288,304 (Tex. App.-Austin                   2013, no

pet.).

          The sole case cited by the Comptroller, Chrismon v. Brown,

246 S.W.3d 102 (Tex. App.-Houston               [14th Dist.] 2007, no pet.), simply

held that a court of appeals cannot reverse a decision that is not in error,

an indisputable proposition having nothing to do with this issue.

                                    CONCLUSION

           For the reasons set forth in the Motion for Rehearing and above, this

Court should rule that Rent-A-Center's cost of goods sold is original cost

not reduced by depreciation taken on its federal tax return.' The


1 Although Rent-A-Center suggested that the Court might remand the case for the
limited purpose of calculating the amount of the refund due it (Petition for Rehearing

                                            4
1898612.2/SPSN67691/0102/071415
Comptroller has offered no argument against that proposition in its Brief on

Appeal or in its Response to Rent-A-Center's Motion for Rehearing, tacitly

conceding that it is correct.

                                        Respectfully submitted,

                                        Daniel L. Butcher
                                        State Bar No: 03512050
                                        dan. butcher@strasburger.com
                                        P. Michael Jung
                                        State Bar No. 11054600
                                        michael.jung@strasburger.com
                                        Strasburger & Price, LLP
                                        901 Main Street, Suite 4300
                                        Dallas, Texas 75202-3794

                                        lsI Farley P. Katz
                                        Farley P. Katz
                                        State Bar No. 11108790
                                        farley.katz@strasburger.com
                                        Forrest M. (Teo) Seger III
                                        State Bar No. 24070587
                                        teo. seger@strasburger.com
                                        Strasburger & Price, LLP
                                        2301 Broadway
                                        San Antonio, Texas 78215
                                        (210) 250-6000 Telephone
                                        (210) 250-6100 Facsimile

                                        And

                                        Robert M. Q'Boyle
                                        State Bar No. 15165425
                                        bob. oboyle@strasburger.com
                                        Clinton A. Rosenthal

p. 10), that suggestion was only for the convenience of the Court. The calculation of
Rent-A-Center's tax refund will be an undisputed matter which the parties could handle
by agreement here or in the trial court.

                                           5
1898612.2/SPSAl67691/0102/071415
                                             State Bar No. 24037393
                                             clint. rosenthal@strasburger.com
                                             Strasburger & Price, LLP
                                             720 Brazos Street, Suite 700
                                             Austin, Texas 78701
                                             (512) 499-3600 Telephone
                                             (512) 499-3660 Facsimile

                                             ATTORNEYS FOR APPELLANT
                                             RENT-A-CENTER, INC.

                                    CERTIFICATE OF SERVICE

       Pursuant to E-Filing Standing Order, I certify that on July 14, 2015, I
electronically filed the foregoing with the Clerk of Court using the
EFile.TXCourts.gov electronic filing system which will send notification of
such filing to the following:

           Matthew H. Frederick, Esq.
           Jim B. Cloudt, Esq.
           Charles K. Eldred
           Assistant Attorney General
           Financial and Tax Litigation Division
           P.O. Box 12548
           Austin, Texas 78711-2548

                                             /s/ Farley P. Katz
                                             Farley P. Katz

                                   CERTIFICATE OF COMPLIANCE

       This motion complies with Tex. R. App. P. 9.4(i)(2)(D), because the
brief contains 825 words, excluding the parts of the brief exempted by Tex.
R. App. P. 9.4(i)(1).

                                                /s/ Farley P. Katz
                                                Farley P. Katz




                                               6
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