No. 07-15-00113-CV

IN THE SEVENTH COURT OF APPEALS,

AMARILLO, TEXAS

MOHAMMED FAWWAZ SHOUKFEH, M.D., PA; D/B/A TEXAS CARDIAC CENTER, 

APPELLANT, 

V. 

TEXAS WORKFORCE COMMISSION AND JAMES G. GRATTAN, 

APPELLEES

APPEALED FROM THE 99TH DISTRICT COURT OF LUBBOCK COUNTY, TEXAS

DISTRICT COURT CAUSE NO. 2014-510,479

HON. WILLIAM SOWDER PRESIDING

BRIEF OF APPELLEE

TEXAS WORKFORCE COMMISSION

 

KEN PAXTON

Attorney General of Texas

CHARLES E. ROY

First Assistant Attorney General

JAMES E. DAVIS

Deputy Attorney General for 

Defense Litigation

ROBERT O’KEEFE

Chief, Financial Litigation, Tax, and 

Charitable Trusts Division

PETER E. LAURIE

Assistant Attorney General

Financial Litigation, Tax, and 

Charitable Trusts Division

State Bar No. 24070973

PO Box 12548

Austin, Texas 78711

TEL: (512) 475-2940

FAX: (512) 478-4013

peter.laurie@texasattorneygeneral.gov

ATTORNEY FOR APPELLEE

TEXAS WORKFORCE 

COMMISSION

ORAL ARGUMENT REQUESTED

ACCEPTED

07-15-00113-CV

SEVENTH COURT OF APPEALS

AMARILLO, TEXAS

7/1/2015 4:28:47 PM

Vivian Long, Clerk

 FILED IN 7th COURT OF APPEALS AMARILLO, TEXAS 7/1/2015 4:28:47 PM VIVIAN LONG CLERK
IDENTITIES OF PARTIES AND COUNSEL

In order that the members of this Court may determine disqualification and 

recusal under the Texas Rules of Appellate Procedure, this Appellant certifies that 

the following is a complete list of the parties, attorneys, and other persons in this 

lawsuit.

Appellant: Mohammed Fawwaz Shoukfeh, M.D. P.A.

d/b/a Texas Cardiac Center

Attorney for Appellant: H. Grady Terrill

Elizabeth G. Hill

Craig, Terrill, Hale & Grantham, LLP

9816 Slide Road, Ste. 201

Lubbock, Texas 79424

Appellee: James G. Grattan

Attorney for Appellee: John H. Simpson

Splaw Simpson Pitts

P.O. Box 1376

Lubbock, Texas 79408-1376

Appellee: Texas Workforce Commission

Attorney for Appellee: Peter E. Laurie

Assistant Texas Attorney General

Financial Litigation, Tax, and Charitable 

Trusts Division

P. O. Box 12548

Austin, TX 78711-2548

i
TABLE OF CONTENTS

IDENTITIES OF PARTIES AND COUNSEL ......................................................... i

INDEX OF AUTHORITIES................................................................................iii-iv

STATEMENT OF THE CASE..................................................................................1

STATEMENT REGARDING ORAL ARGUMENT ...............................................1

ISSUES PRESENTED...............................................................................................1

STATEMENT OF FACTS ........................................................................................2

SUMMARY OF ARGUMENT.................................................................................5

ARGUMENT.............................................................................................................5

I. Judicial review of a TWC Payday decision is by trial de novo

based on the substantial evidence rule. ..................................................5

II. Grattan is entitled to $125,988.91 in unpaid wages from Texas 

Cardiac. ..................................................................................................7

III. Texas Cardiac has not met its burden. .................................................10

IV. Texas Cardiac’s contract with Dr. Ahmad Qaddour is not 

relevant.................................................................................................11

PRAYER..................................................................................................................12

CERTIFICATE OF COMPLIANCE.......................................................................13

CERTIFICATE OF SERVICE ................................................................................14

ii
INDEX OF AUTHORITIES

Cases

Bollner v. Plastics Solutions of Texas, Inc., 270 S.W.3d 157 (Tex. App. El Paso 

2008, no pet.)...........................................................................................................7

City of San Antonio v. Flores, 619 S.W.2d 601 (Tex. Civ. App.–Houston [14th 

Dist.] 1981, writ ref’d n.r.e.)...............................................................................5, 6

Collingsworth Gen. Hosp. v. Hunnicut, 988 S.W.2d 706, 708 (Tex. 1998); Mercer 

v. Ross, 701 S.W.2d 830, 801 (Tex. 1986) .............................................................5

Cusson v. Firemen’s & Policemen’s Civil Serv. Comm’n, 524 S.W.2d 88 (Tex. 

Civ. App.–San Antonio 1975, no writ)...............................................................5, 6

DeLeon v. Tex. Employment Comm’n, 529 S.W.2d 268, 270 (Tex. Civ. App.—

Corpus Christi 1975, writ ref’d n.r.e.).....................................................................6

Direct Commc’ns v. Tex. Employment Comm’n, 906 S.W.2d 537, 542 (Tex. 

App.—Dallas 1995, no writ)...................................................................................5

Luling Oil & Gas Co. v. Humble Oil & Refining Co., 144 Tex. 475, 191 S.W.2d 

716 (1945)...............................................................................................................8

Mescalero Energy, Inc. v. Underwriters Indem. General Agency, Inc., 56 S.W.3d 

313 (Tex. App. Houston [1st Dist.] 2001 pet. denied).............................................8

Mutual Bldg. and Loan Ass’n v. Lewis, 572 S.W.2d 771, 778 (Tex. Civ. App.–

Austin 1978, no writ) ..............................................................................................6

Olivarez v. Aluminum Corp. of Am., 693 S.W.2d 931, 932 (Tex. 1985)...................6

Prof’l Mobile Home Transport v. R.R. Comm'n of Tex., 733 S.W.2d 892. 899 (Tex. 

App. Austin 1987, writ refused n.r.e.) ....................................................................6

Tex. Aeronautics Comm’n v. Braniff Airways, Inc., 454 S.W.2d 199, 202, 205 

(Tex. 1970)..............................................................................................................6

Tex. Employment Comm’n v. Holberg, 440 S.W.2d 38 (Tex. 1969).........................6

iii
INDEX OF AUTHORITIES (CONT’D)

Statutes

Tex. Lab. Code § 61.018 (West 2015).......................................................................8

Tex. Lab. Code Ann. § 61.062 (West 2015)..............................................................5

Other Authorities

Black’s Law Dictionary 575 (3rd pocket ed. 2006)..............................................8, 11

Webster’s Ninth New Collegiate Dictionary 944 (1989).....................................8, 11

Rules

Texas Rule of Appellate Procedure 38.2(a)(1)(B).....................................................1

iv
STATEMENT OF THE CASE

Nature of the Case: This appeal concerns a Texas Workforce Commission (“TWC”)

wage claim decision. The TWC determined that Appellee Mohammed Fawwaz 

Shoukfeh, MD PA d/b/a Texas Cardiac Center (“Texas Cardiac”) owed James G.

Grattan (“Grattan”) $125,988.91 in unpaid wages. The TWC filed a motion for 

summary judgment asserting that substantial evidence supported the decision Texas 

Cardiac challenged.

Trial Court Disposition: The trial court granted the TWC’s motion for summary 

judgment and dismissed the case, in its entirety.

STATEMENT REGARDING ORAL ARGUMENT

The TWC believes oral argument should be denied as it will not aid this Court 

in addressing the legal issues presented in this appeal. The facts and legal arguments 

are adequately presented in the briefs and record, and the decisional process would 

not be significantly aided by oral argument. But if the Court deems oral argument 

necessary, the TWC reserves its right to participate.

ISSUES PRESENTED

The TWC is dissatisfied with Texas Cardiac’s Statement of Issues and restates 

the issue pursuant to Texas Rule of Appellate Procedure 38.2(a)(1)(B) as follows:

There is only one issue in this case: Does substantial 

evidence support the decision Texas Cardiac challenged?

1
STATEMENT OF FACTS

Grattan worked as a cardiologist for Texas Cardiac from June 19, 2006 

through April 30, 2013.1 When Grattan began his employment with Texas Cardiac, 

the parties laid out the terms of Grattan’s employment in a formal agreement (the 

“Agreement”), including how his pay would be calculated. 2 The Agreement 

provided that Grattan would receive six percent of the designated health service 

revenue, defined by the Agreement, during his first year of employment.3 Grattan 

was responsible for specific expenses, including his share of overhead expenses.

4

Additionally, Grattan would receive his net receipts less his pro rata share of the 

overhead expenses.5

While Grattan was employed by Texas Cardiac, the number of physicians 

working for Texas Cardiac fluctuated.6 As a result, Grattan’s pro rata share of the 

overhead expenses changed based upon the number of physicians employed by 

1 Clerk’s Record (“CR”): 260.

2 CR: 262-264.

3 CR: 262.

4 CR: 262-263.

5 CR: 369-372; 399-400.

6 Id.

2

 
Texas Cardiac.

7 In September of 2012, Texas Cardiac employed three physicians, 

including Grattan, and the overhead expenses were split evenly among the three 

physicians.

8

In November 2012, a new physician came to work for Texas Cardiac, bringing 

the number of physicians to four.9 But Texas Cardiac deducted one-third of the 

overhead expenses from Grattan’s net receipts from November 2012 through April 

2013, despite the fact there were now four physicians.10

The Agreement between Texas Cardiac and Grattan regarding his 

employment and compensation was not modified when the new physician joined the 

practice, and Grattan did not authorize deductions from his wages beyond what was 

agreed upon in the formal written agreement dated June 19, 2006.11

In May of 2013 Defendant Grattan filed a wage claim with the TWC seeking 

wages earned but not received from September 2012 through April 2013 from Texas 

Cardiac. 12 On June 20, 2013, the TWC received Texas Cardiac’s response to 

7 Id.

8 Id.

9 Id.

10 CR: 369-372; 400.

11 Id.

12 CR: 233-234.

3

 
Grattan’s wage claim.13 The TWC mailed a Preliminary Wage Determination Order 

finding, based upon the information provided by Texas Cardiac and Grattan, that 

Grattan was entitled to $38,435.89 in unpaid wages.14

Both Texas Cardiac and Grattan appealed. After a telephonic hearing, the 

TWC Wage Claim Appeal Tribunal issued its determination modifying the August 

14, 2013 determination based upon the testimony and evidence presented in the 

hearing to find that Grattan was entitled to $5,817.32 in unpaid wages.15 Again, both 

Texas Cardiac and Grattan appealed. On February 6, 2014, the TWC Commission 

issued its Findings and Decisions modifying the Wage Claim Appeal Tribunal’s 

decision and finding that Grattan was entitled to $125,988.91 in unpaid wages.16

Texas Cardiac filed suit challenging the TWC’s decision in the 99th District 

Court. The parties filed cross-motions for summary judgment. The trial court granted 

the TWC’s and Grattan’s motion and entered final judgment against Texas

Cardiac.17 This appeal followed. 

13 CR: 218-219.

14 CR: 169-170.

15 CR: 94-103.

16 CR: 75-80.

17 CR: 426-427.

4

 
SUMMARY OF ARGUMENT

There is but one legal question before this Court: Does substantial evidence 

supports the TWC’s decision? This is a question of law and no material fact issues 

exist. Because substantial evidence support the TWC’s decision, the Court should 

affirm the trial court’s judgment.

ARGUMENT

I. Judicial review of a TWC Payday benefits decision is by trial de novo

based on the substantial evidence rule.

Judicial review of a TWC decision regarding a claim for unpaid wages is by 

trial de novo to determine whether substantial evidence exists to support the TWC 

decision.18 Under this standard, the TWC’s decision is presumed to be valid, and 

the party challenging the decision has a significant burden to prove otherwise.19

Substantial evidence need not be much evidence, and although “substantial” 

means more than a mere scintilla, or some evidence, it need not be a preponderance 

of the evidence. 20 “In fact, the evidence may be substantial and yet greatly 

18 Tex. Lab. Code Ann. § 61.062 (West 2015); see Direct Commc’ns v. Tex. Employment 

Comm’n, 906 S.W.2d 537, 542 (Tex. App.—Dallas 1995, no writ); see also City of San Antonio 

v. Flores, 619 S.W.2d 601 (Tex. Civ. App.–Houston [14th Dist.] 1981, writ ref’d n.r.e.); Cusson 

v. Firemen’s & Policemen’s Civil Serv. Comm’n, 524 S.W.2d 88 (Tex. Civ. App.–San Antonio 

1975, no writ).

19 Collingsworth Gen. Hosp. v. Hunnicut, 988 S.W.2d 706, 708 (Tex. 1998); Mercer v. Ross, 

701 S.W.2d 830, 801 (Tex. 1986).

20 Mutual Bldg. and Loan Ass’n v. Lewis, 572 S.W.2d 771, 778 (Tex. Civ. App.–Austin 1978, no 

5

 
preponderate the other way.”21

When conducting a substantial evidence review of a state agency’s 

administrative decision, it is error for a court to engage in an independent factual 

inquiry.22 A court’s role, under this standard, is to hear and consider evidence to 

determine whether reasonable support exists for the agency’s decision.23

A court must uphold the TWC’s decision if it is reasonable even though the 

court, if it were acting as the trier of fact, might have reached a different 

conclusion. 24 If the arguments of both sides are reasonable, even if there is 

conflicting evidence, then there is substantial evidence to support the TWC’s 

decision and a court must uphold the agency decision.25 A court may only set aside 

the agency’s decision if it finds the decision “to have been made without regard to 

the law or the facts and therefore was unreasonable, arbitrary, or capricious.”26

writ); Olivarez v. Aluminum Corp. of Am., 693 S.W.2d 931, 932 (Tex. 1985).

21 Olivarez, 693 S.W.2d at 932.

22 Prof’l Mobile Home Transport v. R.R. Comm'n of Tex., 733 S.W.2d 892. 899 (Tex. App. 

Austin 1987, writ refused n.r.e.).

23 Id.

24 Flores, 619 S.W.2d at 602.

25 Tex. Aeronautics Comm’n v. Braniff Airways, Inc., 454 S.W.2d 199, 202, 205 (Tex. 1970); 

Cusson, 524 S.W.2d at 90.

26 DeLeon v. Tex. Employment Comm’n, 529 S.W.2d 268, 270 (Tex. Civ. App.—Corpus Christi 

1975, writ ref’d n.r.e.); see also Tex. Employment Comm’n v. Holberg, 440 S.W.2d 38 (Tex. 

1969).

6

 
II. Grattan is entitled to $125,988.91 in unpaid wages from Texas Cardiac.

Texas Cardiac is liable for unpaid wages owed to Grattan. Texas Labor Code 

§ 61.001(7) defines wages, in part, to mean “compensation owed by an employer for 

labor or services rendered by an employee, whether computed on a time, task, piece, 

commission or other basis[.]” The Labor Code states that an employer may not 

withhold or divert any part of an employee’s wages unless the employer (1) is 

ordered to do so by a court of competent jurisdiction, (2) is authorized to do so by 

state or federal law; or (3) has written authorization from the employee to deduct 

part of the wages for a lawful purpose.27

While employed by Texas Cardiac, Grattan’s wages were calculated based 

upon the Agreement.28 Under the Agreement, Grattan was responsible for:

. . .a pro rata share of the overhead expenses . . . and [Grattan] 

will receive Physician’s Net Receipts collected by Association 

less [Grattan’s] pro rata share of the overhead expenses.

The Agreement does not define “pro rata.” Thus, the question is: how is the pro rata

share calculated? In the absence of a contractual definition, a court can resort to a 

standard dictionary to supply the meaning.

29 Webster’s Dictionary defines ‘pro 

27 Tex. Lab. Code § 61.018 (West 2015).

28 CR: 262-263.

29 Bollner v. Plastics Solutions of Texas, Inc., 270 S.W.3d 157 (Tex. App. El Paso 2008, no 

pet.).

7

 
rata’ as “proportionately according to an exactly calculable factor”, and Black’s 

Legal Dictionary contains a similar definition of “proportionately; according to an 

exact rate, measure or interest.”30

In addition, Texas Cardiac’s custom and practice can assist the Court in 

resolving this question. When construing a contract the Court may consider the

general customs and practices affecting the subject matter of the agreement, and 

extrinsic evidence of the commonly understood meaning of a term in a contract may 

be offered.31

In the past, overhead was divided among all physicians working for Texas 

Cardiac.

32 Consistent with that practice overhead expenses of the practice were split 

among all physicians working for Texas Cardiac.

33

Grattan’s gross salary, before taxes, for September 2012 was $15,024.36, and 

$28,022.12 for October.34 These wages were calculated based upon the formula 

provided in the 2006 agreement, and correctly reflect the overhead divided among 

30 Webster’s Ninth New Collegiate Dictionary 944 (1989); Black’s Law Dictionary 575 (3rd

pocket ed. 2006).

31 Luling Oil & Gas Co. v. Humble Oil & Refining Co., 144 Tex. 475, 191 S.W.2d 716 (1945); 

Mescalero Energy, Inc. v. Underwriters Indem. General Agency, Inc., 56 S.W.3d 313 (Tex. App. 

Houston [1st Dist.] 2001 pet. denied).

32 Id.

33 Id.

34 CR: 369-372; 393.

8

 
the then three employed physicians. 

Under the customary practice, the pro rata method of calculating overhead, 

from November 2013 forward, Grattan earned the following wages:

November: $35,423.50

December: $32,128.27

January: $-4,350.45

February: $21,934.28

March: $5,443.97

April: $24,377.5435

In all, between September 2012 and April 2013, Grattan earned $158,003.59 in gross 

salary.36 Texas Cardiac issued Grattan a check for $32,014.68 in May of 2013.37

Taking this partial payment into account, Grattan is entitled to $158,003.59 less the 

$32,014.68, which equals $125,988.91 in gross wages before the customary pro rata

deduction and other standard deductions for taxes. 

And $125,988.91 in gross wages is the amount the TWC awarded Grattan. 

This award is based on credible evidence presented to the TWC during the 

administrative process and to the trial court on summary judgment. The TWC’s 

decision is supported by substantial evidence and the trial court properly affirmed it 

on summary judgment. 

35 Id.

36 Id.

37 CR: 371.

9

 
III. Texas Cardiac has not met its burden.

Texas Cardiac alleges that the TWC ignored the plain language of the June 

19, 2006 Agreement when it found that the ‘pro rata share of overhead expenses’ 

meant that the overhead expenses should be divided by the total number of 

physicians employed by Texas Cardiac.

38 Texas Cardiac’s argument is that the 

TWC should not have accepted Grattan’s interpretation of the language but should 

have accepted Texas Cardiac’s method. Instead of calculating pro rata shares based 

on the total number of physicians working for Texas Cardiac, Texas Cardiac urges 

the Court to make this calculation based on just three physicians. 

Texas Cardiac’s argues that the overhead expenses should be divided among 

three physicians, not four, because the new physician did not yet have privileges

and was differently situated from other physician’s in Texas Cardiac’s practice.

39

But the Agreement between Grattan and Texas Cardiac does not include any such

exception to the pro rata calculation. And calculating Grattan’s wages according to

this method would be inconsistent with the plain meaning of pro rata and 

inconsistent with Texas Cardiac’s past practices.

38 Appellant’s Brief: 8-20.

39 Webster’s Ninth New Collegiate Dictionary 944 (1989); Black’s Law Dictionary 575 (3rd

pocket ed. 2006).

10

 
The TWC’s decision is based on the plain language of the Agreement between 

Texas Cardiac and Grattan and based on Texas Cardiac’s past payment practices. 

Texas Cardiac’s alternate calculation method does not “totally destroy” the basis 

upon which the TWC rendered its decision. 

Because Texas Cardiac did not meet its burden to “totally destroy” the TWC’s 

case, the trial court properly granted summary judgment in the TWC’s and Grattan’s 

favor.

IV. Texas Cardiac’s contract with Dr. Ahmad Qaddour is not relevant. 

Texas Cardiac spends a considerable portion of his brief arguing that the 

TWC’s decision is illegal under the Labor Code and imposes extra-contractual 

responsibilities on Texas Cardiac.

40 Texas Cardiac argues that the decision 

requires it to “deduct overhead expenses to Qaddour.” 41 Because of this 

“requirement” Texas Cardiac claims that it must deduct wages from Qaddour’s 

salary without a contractual agreement to do so in violation of the Labor Code. 

Texas Cardiac’s argument is based on this premise: The TWC’s decision 

requires Texas Cardiac to alter the terms of his contract with Qaddour. This premise 

is flawed, and the TWC responds to the argument as follows:

40 Appellant’s Brief: 20-26.

41 Appellant’s Brief: 20

11

 
First, the only contract relevant to the Court’s analysis is the one between 

Grattan and Texas Cardiac;

Second, nothing in the TWC’s order requires Texas Cardiac to do anything 

with respect to Qaddour; and

Third, to the extent Texas Cardiac’s agreements with Grattan and Qaddour 

caused it to incur unanticipated expenses, Texas Cardiac cannot shift the cost of its

oversight to Grattan.

For these reasons, the Court should place no weight on Texas Cardiac’s 

argument that the TWC’s decision imposes extra-contractual obligations on Texas 

Cardiac and/or is illegal. 

PRAYER

FOR THESE REASONS, the TWC prays that this Court affirm the trial 

court’s judgment in its entirety.

Respectfully submitted,

KEN PAXTON

Attorney General of Texas

CHARLES E. ROY

First Assistant Attorney General

JAMES E. DAVIS

Deputy Attorney General for Defense Litigation

12
ROBERT O’KEEFE

Division Chief

Financial Litigation, Tax, and Charitable Trusts 

Division

/s/ Peter Laurie

PETER E. LAURIE

Assistant Attorney General

Bar No. 24070973

Financial and Tax Litigation

PO Box 12548

Austin, Texas 78711-2548

(512) 475-2940

(512) 478-4013 - FAX

Attorneys for Defendant

Texas Workforce Commission

CERTIFICATE OF COMPLIANCE

This document complies with the typeface requirements of Tex. R. App. P. 

9.4(e) because it has been prepared in a conventional typeface no smaller than 14-

point for text and 12-point for footnotes. This document also complies with the 

word-count limitations of Tex. R. App. P. 9.4(i), if applicable, because it contains 

1712 words, excluding any parts exempted by Tex. R. App. P. 9.4(i)(1), as counted 

by the computer program used to prepare this document.

/s/ Peter E. Laurie

PETER E. LAURIE

Assistant Texas Attorney General

13
CERTIFICATE OF SERVICE

Pursuant to the Texas Rules of Appellate Procedure, the undersigned hereby certifies 

that on the 1st day of July, 2015, a true and correct copy of the Brief of Appellee 

Texas Workforce Commission was sent via e-serve.

/s/ Peter E. Laurie

PETER E. LAURIE

Assistant Texas Attorney General

14