COURT OF APPEALS

EIGHTH DISTRICT OF TEXAS

EL PASO, TEXAS

ROBERT JOSEPH GAUDET, JR.,

Appellant/Cross

- Appellee,

v.

ICON CUSTOM HOME BUILDER, LLC

and JUANA GARCIA,

Appellees/Cross

- Appellants. §

§

§

§

§

§ No. 08

- 23

- 00075

- CV

Appeal from the

243rd Judicial District Court

of El Paso County, Texas

(TC# 2020DCV3607)



### DISSENT

Litigation can teach hard lessons. One lesson is that if you throw everything including the

kitchen sink at your adversary

— and lose the case

—

you better be careful with what is in the kitchen

sink

. Here, what would best be classed as a misrepresentation case, was bootstrapped into DTPA

theories that were not legally viable (not even by good fa it h extension arguments). And i n my view,

the trial court did not abuse its discretion in concluding that the “ representation s ” w ere no more

than price estimates for building a house where the specifications were in constant flux. The

estimates were identified as such, and no reasonable person, particularly a graduate of Stanford

Law School ( as is the Appellant here)

, sh ould have seen them as anything different.

Given th e problem s with the mis representation claim

, Gaudet contort s the facts to try and

fit other DTPA theories. H e claim s that ICON pulled a “ bait and switch ” advertisement

. Tex. Bus.2

& Com. Code Ann. § 17.46 (9) ( “ advertising goods or services with intent not to sell them as

advertised ” ). Subsection (9) is “ broadly phrased, appl [ies] to all advertising, and [is] generally

implicated by price representations

. ” Perez v. Hung Kien Luu

, 244 S.W.3d 444, 447 ( Tex. App.

—

Eastland 2007

, no pet. )

. But it still requires an advertisement. And there is a fundamental

disconnect between the advertisement that Gaudet identifies ( “ Custom Builder ” ) and the linchpin

of his fals ity claim (price of the home). ICON did advertise that it is a “ Custom Builder

, ” but it did

not advertise the price of any home that it could build for Gaudet. P rice negot i ation s between

pr ivate parties a re not advertis e ment s in any sense of the word

. See Smith v. Baldwin

, 611 S.W.2d

611, 614 ( Tex. 1980).

Nor do these facts fit § 17.46 (11) ( “ making false or misleading statements of fact

concerning the reasons for, existence of, or amount of price reductions ” ). “ To violate this

subsection, false factual statements must be made about the reasons for, existence of, or the amount

of a price reduction. ” Washburn v. Sterling McCall Ford

, 521 S.W.3d 871, 875 ( Tex. App.

—

Houston [14 th Dist.] 2017

, no pet. )

. T his provision “ is concerned with price advertising abuse.

Most of the abuses in this area deal with conveying the false impression in an effort to promote

products and services that the seller is bankrupt, liquidating its inventory, going out of business, or

losing its lease. ” Id. (omitting case citations). Yet Gaudet complains about price increases and not

reductions ; nothing about his th eory fits the apparent evil this section is intended to address. His

argument for an extension of the law boils down to his counsel ’ s view that “ [t] he price reductions,

it came from the

— it sort of was in reverse. The price would go up. ” T hat logic

, however, would

not exten d the law

— it would be a re

- writing of the statute

, something courts are not allowed to do

.

See Entergy Gulf States, Inc. v. Summers

, 282 S.W.3d 433, 443 ( Tex. 2009)

, ( quoting Simmons v.

Arnim

, 220 S.W. 66, 70 (1920) ( “ Courts must take statutes as they find them. ” ) )

.3

Gaudet also alleged that ICON misrep r esented its agent ’ s authority

. Se e § 17.46(b)(14)

( “ misrepresenting the authority of a salesman, representative or agent to negotiate the final terms

of a consumer transaction ” ). The allegation originates with Juana Garcia having provid ed Gaudet

a preliminary estimate for one house model that she revise d a week later because she overlooked

the cost of a rock wall

— an oversight that Garcia claimed her husband discovered

. Th at event does

not support a misrepresen t ation of authority. Nor is there any basis to claim it could be the

producing cause of damages

. See Miller v. Keyser

, 90 S.W.3d 712, 716 ( Tex. 2002) ( “ The DTPA

requires that the consumer show that the misrepresentation was false and that the false

misrepresentation was the producing cause of the consumer ’ s damages. ” ). Gaudet ’ s testimony

below was that “ [Garcia] was pretending she didn ’ t have the authority to give us the price when I

knew she was the owner and she had full authority to give us the price. ” For her part, Garcia denied

that she ever misre pre sented her autho rity

, but Gaudet by his own admission claims to have known

the truth of the matter. And the only agreement he entered after th is initial estimate

— the D e posit

A greement

— belies that a final price had been reached. 1

Gaudet also pigeon

- holes these facts into a failure to disclose theory. Id

. § 17.46(b)(24)

( “ failing to disclose information concerning goods or services which was known at the time of the

1 The Deposit Agreement itself states:

The Deposit will cover only the purchase of preliminary schemes and not the full set of plans. Once

the Builder and Buyer have agreed on a scheme with a floor plan and elevation, and a contract for

the purchase of a home has been signed, Builder will credit the Deposit towards the contract sales

price.

. . . In the event the Builder and Buyer do not agree on a purchase price, the Builder will not refund the

Deposit to Buyer.

This document shows only an intent to purchase a property so Builder’s representative or Real Estate

Agent may start the process of showing inventory to Buyer, in which case the lot hold amount will

be zero dollars ($0).4

transaction if such failure to disclose such information was intended to induce the consumer into

a transaction into which the consumer would not have entered had the information been

disclosed ” )

. Yet the only “ transaction ” was the $500 deposit agreement, and that agreement

disclosed that the final purchase price w as yet to be agreed on and would depend on an agreed

floor plan and elevation.

The trial court conducted a hearing over three days, taking testimony from Gaudet, his

attorney, Garcia

, and ICON ’ s counsel. The judge opened the hearing with a correct stat ement of

t he DTPA groundless standard and recognized that ICON carried a “ tough ” burden to establish

groundlessness ( “ And if there ’ s a scintilla of wiggle room to argue in fact or in law that you feel

there was a misrepresentation or if you feel that there was, you know, an actionable ground for the

DTPA, it survives. ” )

. Th roughout the hearing, the trial judge expressed her knowledge of the law,

the facts

, and history of the case

. I cannot conclude that she abused her discretion in making any

of the detailed findings that she did. 2

The other lesson here has to do with proportionality. The DTPA claim began with a demand

letter seeking return of a $500 deposit

, the cost of buying a drone, the cost of a survey

, and

unspecified mental anguish damages

. ICON, without admitting the merits of the allegations,

offered to reimburse Gaudet for his claimed actual damages. 3 He declined the offer because it did

not address attorney ’ s fees (though he had not hired a lawyer or made a specific monetary demand

for fees ) and did not offer anything for h is and his wife ’ s mental anguish (though she was never a

party to the suit). What follow ed next was Gaudet ’ s 58

- page original petition with 78 numbered

2 And for that same reason, I concur in the portion of the majority opinion that overrules ICON’s cross appeal faulting

the trial court for not finding that the suit was brought in bad faith.

3 ICON offered Gaudet $2,300 to reimburse the $500 builder's deposit, $600 for the cost of the drone, and $1,200 for

the surveyor expenses

.5

paragraphs. 4 He then filed a notice of lis pendens that attempted to tie up ICON ’ s ability to sell the

lot to another buyer. Gaudet tried (unsuccessfully) to defend that filing w i th his own 102

- page

declaration

. Our clerk ’ s record in this case spans more than 2

, 000 pages.

The majority does not reach the last issue

— a challenge to the $ 2 13,072.94 fee award for

trial of the case. I confess the amount is more than anyone would expect for a simple consumer

dispute. But t here is an explanation for that. Newton ’ s Third Law of Mechanics states that for every

action, there is an equal and opposite reaction. See Texas Nat ’ l Bank v. Sandia Mortg. Corp.

, 872

F.2d 692, 700 (5th Cir. 1989) (citing Newton ’ s third law as explanation for award of attorney ’ s

fees against litigant who b lock ed a reasona ble request). Applying that principle here, a litigant

can not make hundred

- page filings and expect that the other side will not read (and bill for th em). 5

Nor can they assert untested legal theories and expect the other side will not expend resources to

contest them. Before the jury, ICON ’ s counsel presented some evidence of the reasonable number

of hours worked multiplied by a reasonable hourly rate. Rohrmoos Venture v. UTSW DVA

Healthcare, LLP

, 578 S.W.3d 469, 475 ( Tex. 2019)

. ICON admitted time and billing records which

provided some evidence of the services performed, who performed those services, when the

services were performed, the time required, and the reasonable hourly rate for the staff doing that

work

. 6 See i d

. a t 498 (setting out required showing for recovery of attorney ’ s fees)

. ICON ’ s

4 The trial court noted that the writing style of these filings all showed them to have been originally drafted by

Mr. Gaudet. His counsel conceded as much, but did review, edit, and approve them before filing.

5 As ICON’s counsel testified to the jury that made findings on the fee award:

And in every instance in every proceeding, motions for summary judgment, motion to expunge lis

pendens, we've had to deal with what I consider excessive briefing and also briefing that's not on

point. But we deal with it. And as a result, we've had to spend a lot of time in this case that we

otherwise would not have had to spend. I would in fact say that this case is unique in the voluminous

nature of the pleadings we've had to deal with.

6 ICON’s attorneys billed between $350 and $400 per hour. Gaudet in his suit was asking for his own fees with an

hourly rate of $749 per hour ( based on the rate he charges for work in a class action suit ).6

attorney segregated fees between the DTPA and other claims. Part of the fee includes defense of

the prior mandamus to this Court. In re Gaudet

, 625 S.W.3d 887, 891 ( Tex. App.

— El Paso 2021,

no pet.)

. The fee

, while high by most standard s

, was supported by the evidence and unique

circumstances of this case.

For these reasons, I respectfully dissent.

JEFF ALLEY

, Chief Justice

August 28

, 2024

Before Alley, C.J., Palafox , J., and Barajas, C.J. (Senior Judge)

Alley, C.J. ( dissenting )

Barajas, C.J. ( Senior Judge) (Sitting by Assignment)