TCI Cavlevision v. Owens

Citation8 S.W.3d 837
Decision Date27 January 2000
CourtCourt of Appeals of Texas

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Before Walker, C.J., Burgess and Stover, JJ.


Earl B. Stover, Justice.

This is an interlocutory appeal from an order certifying a class action under Rule 42 of the Texas Rules of Civil Procedure. Appellants are TCI Cablevision of Dallas, Inc., TCI Cablevision of Houston, Inc., TCI Cablevision of Texas, Inc., and Tele-Communications, Inc. Appellee Bart Owens ("Owens"), who received cable service only from TCI Cablevision of Texas, Inc. ("TCI-Texas"), asserted a claim regarding the late fee charges assessed by appellants on cable subscribers' bills. Owens contended that the late fees neither bore any reasonable relationship to actual losses suffered by appellants because of customers' late payments nor represented a reasonable advance estimate of those losses.

On May 14, 1999, the trial court's amended order named Owens class repre-sentative and certified the following class:

Those persons assessed late fees or administrative fee charges by any TCI entity or their affiliates in the State of Texas for failure to pay their cable bills within the time frame specified by the TCI entity or affiliates at any time during the period beginning in May 1986 and ending on the date notice of this class action is published (the "class" period).

Excluded from the class are the Defendant, any parent, subsidiary, affiliate or any other person controlled by the Defendants, the officers, directors, agents, servants, or employees of any of the same; and the members of the immediate families of any such person. Likewise, excluded from the class are any members of the judicial branch of the State of Texas and members of the immediate families of any such person.

Appellants present one issue on appeal:

Did the district court err in certifying a statewide class of cable television late fee payers to pursue claims for the recoupment of late fees voluntarily paid and for ancillary injunctive relief where the claims of the sole class representative are barred as a matter of law and certification is otherwise improper?

We find the district court did not err.

The Texas Supreme Court recognizes the benefits of class action suits:

Class action suits furnish an efficient means for numerous claimants with a common complaint to obtain a remedy "[w]here it is not economically feasible to obtain relief within the traditional framework of a multiplicity of small individual suits for damages." Deposit Guar. Nat'l Bank v. Roper, 445 U.S. 326, 339, 100 S.Ct. 1166, 1174, 63 L.Ed.2d 427 (1980) . . . . Class actions also facilitate "the spreading of litigation costs among numerous litigants with similar claims." United States Parole Comm'n v. Geraghty, 445 U.S. 388, 403, 100 S.Ct. 1202, 1212, 63 L.Ed.2d 479 (1980).

General Motors Corp. v. Bloyed, 916 S.W.2d 949, 952-53 (Tex.1996); Hi-Lo Auto Supply, L.P. v. Beresky, 986 S.W.2d 382, 385 (Tex. App.--Beaumont 1999, mandamus filed, Mar. 22, 1999).

To obtain certification of a class action, a party must meet all the requirements of TEX. R. CIV. P. 42(a) and also satisfy one of the subsections of TEX. R. CIV. P. 42(b). "Under Rule 42(a), appellants must show: (1) numerosity--the number of plaintiffs is so numerous that joinder of all class members is impracticable; (2) commonality--there are questions of law or fact common to the class; (3) typicality--the claims of the proposed representatives are typical of those of the class; and (4) adequacy--the proposed representatives will fairly and adequately protect the interest of the class." Weatherly v. Deloitte & Touche, 905 S.W.2d 642, 647 (Tex. App.--Houston [14th Dist.] 1995, writ dism'd w.o.j.), mandamus denied, 951 S.W.2d 394 (Tex.1997); TEX. R. CIV. P. 42(a).

Here, the trial court found that the requirements of Rule 42(a) were met and certified the class under Rule 42(b)(1)(A), and 42(b)(4). The court further certified the class under 42(b)(2) to the extent that appellants are assessing late fees for a subscriber's failure to pay cable bills within the time frame specified by appellants. Under Rule 42(b)(1)(A), a class action may be maintained if the prosecution of separate actions by or against individual members of the class would create a risk of inconsistent or varying adjudications with respect to individual members of the class that would establish incompatible standards of conduct for the party opposing the class. Rule 42(b)(2) allows class certification if the party opposing the class has acted or refused to act on grounds generally applicable to the class, thereby making appropriate final injunctive relief or corresponding declaratory relief with respect to the class as a whole. Rule 42(b)(4) requires a finding both that the questions of law or fact common to the members of the class predominate over any questions affecting only individual members, and that a class action is superior to other available methods for the fair and efficient adjudication of the controversy. In applying Rule 42(b)(4), the trial court considers: (a) the interest of members of the class in individually controlling the prosecution of separate actions; (b) the extent and nature of any litigation concerning the controversy already commenced by members of the class; (c) the desirability or undesirability of concentrating the litigation of the claims in the particular forum; and (d) the difficulties likely to be encountered in the management of a class action.

Standard of Review

We review the trial court's decision to certify a class for abuse of discretion. Sun Coast Resources, Inc. v. Cooper, 967 S.W.2d 525, 529 (Tex. App.--Houston [1st Dist.] 1998, pet. dism'd w.o.j.). "There is an abuse of discretion if the record clearly shows that (1) the trial court misapplied the law to the established facts, (2) the material in the record does not reasonably support the findings, or (3) the trial court acted arbitrarily or unreasonably." Id. (citing Weatherly, 905 S.W.2d at 648). A trial court has broad discretion in determining whether a lawsuit should be maintained as a class action. Dresser Indus., Inc. v. Snell, 847 S.W.2d 367, 371 (Tex. App.--El Paso 1993, no writ). "In reviewing the trial court's ruling on certification, the appellate court is required to view the evidence in a light most favorable to the trial court's action, and indulge every presumption in favor of the trial court's action." Weatherly, 905 S.W.2d at 647. A trial court does not abuse its discretion when it bases its decision on conflicting evidence. Wiggins v. Enserch Exploration, Inc., 743 S.W.2d 332, 334 (Tex. App.--Dallas 1987, writ dism'd w.o.j.). "That the trial court, in the opinion of the appellate court, made an error in judgment, does not alone demonstrate an abuse of discretion." Weatherly, 905 S.W.2d at 647. If the court considers class certification early in a proceeding, before supporting facts are fully developed, it should favor maintaining the class action. Microsoft Corp. v. Manning, 914 S.W.2d 602, 607 (Tex. App.--Texarkana 1995, writ dism'd). The court may always subsequently modify or decertify the class later. Id.

Appellants make four arguments in support of their issue.

Owens Received Service From Only One Appellant

Appellants first argue that Owens cannot represent others in a suit against cable companies from which he has received no service and with which he has no contractual relationship. Owens stated that he: (1) received cable service only from TCI-Texas; (2) had no contractual relationship with any other cable provider; and (3) had no knowledge of any other provider's billing practices.

Generally, "a plaintiff cannot represent those having causes of action against other defendants against whom the plaintiff has no cause of action and from whose hands he suffered no injury." Cedar Crest Funeral Home, Inc. v. Lashley, 889 S.W.2d 325, 331 (Tex. App.--Dallas 1993, no writ). "This rule applies even if the plaintiffs' injuries are identical to those of the parties they are representing." Id. However, "[t]here are two exceptions to this rule: (1) situations in which all injuries are the result of a conspiracy or concerted scheme among the defendants; and (2) instances in which all defendants are juridically related in a manner that suggests a single resolution of the dispute would be expeditious." Id.

In his brief on appeal, Owens has not alleged that the "conspiracy or concerted scheme" exception applies, but rather argues the appellants are "juridically linked." "A 'juridical link' is a legal relationship among the defendants that permits a single resolution of the dispute which is preferable to a multiplicity of similar actions." Id. at 332. "A juridical relationship is most often found where all defendants are officials of a single state and are charged with enforcing or uniformly acting in accordance with a state statute, rule or practice of state-wide application that is alleged to be unconstitutional." Id. The Lashley court determined there was no juridical link among a number of funeral homes that had arranged for dead bodies to be embalmed as part of a college's instructional program without the knowledge or consent of the decedents' families. Id. at 332.

However, the Corpus Christi court of appeals recently applied the "juridically related" exception to a case involving commonly-owned financial institutions. Texas Commerce Bank Nat'l Ass'n v. Wood, 994 S.W.2d 796, 807 (Tex. App.--Corpus Christi 1999, pet. dism'd). Th...

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