COURT OF APPEALS

SECOND DISTRICT OF TEXAS

FORT WORTH

NO. 02-12-00337-CV

LIBERTY BANK, F.S.B. APPELLANT

V.

ANDREW B. ETTER D/B/A 

ANDREW B. ETTER LAW OFFICES

APPELLEE

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FROM COUNTY COURT AT LAW NO. 3 OF TARRANT COUNTY

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MEMORANDUM OPINION1

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I. INTRODUCTION

In four issues, Appellant Liberty Bank, F.S.B. challenges a summary 

judgment granted in favor of Appellee Andrew B. Etter d/b/a Andrew B. Etter Law 

Offices. The sole issue we decide is whether an Iowa judgment obtained by

Liberty Bank (as assignee of an equipment rental agreement between 

NorVergence, Inc. and Etter) may be given effect in Texas when, prior to entry of 

 

1See Tex. R. App. P. 47.4.
2

the Iowa judgment, the 270th District Court of Harris County declared all 

equipment rental agreements procured between NorVergence and Texas 

consumers to be void ab initio as a result of a Deceptive Trade Practices Act 

(DTPA) suit filed by the Texas Attorney General.

2

 Because the equipment rental 

agreement upon which Liberty Bank sued Etter was void ab initio and was 

unenforceable against Etter, we will affirm the trial court’s summary judgment for 

Etter.

II. FACTUAL AND PROCEDURAL BACKGROUND

A. The Equipment Rental Agreement

In April 2004, a representative from NorVergence contacted Etter at his 

place of business concerning the purchase of a telecommunications system that 

would offer cellular service at a lower price than his then-existing telephone 

carrier. The NorVergence representative explained that the new patented 

technology in their telecommunications system involved the use of a device 

called a “Matrix” box that could deliver both landline and cellular services. Etter 

executed an “Equipment Rental Agreement” (ERA) with NorVergence. Under the 

terms of the ERA, Etter agreed to make monthly rental payments of $290.69, 

including taxes, for sixty months. After NorVergence installed a Matrix in Etter’s 

 

2

The judgment states, “All Equipment Rental Agreements or other 

contracts procured between NorVergence and Texas consumers or between 

finance companies and Texas consumers as a result of a NorVergence 

solicitation directed to any Texas consumer are the result of deceptive and unfair 

practices and fraud on the part of NorVergence and, therefore, are declared void 

ab initio and are unenforceable.” 
3

office, he inquired whether the equipment was operational and was told that it 

would be “hooked up” to the phone line in a few days. According to Etter, the 

Matrix was never completely installed and has never provided telephone service. 

In May 2004, NorVergence assigned the ERA to Liberty Bank. The

assignment contained a clause stating that any action or proceeding relating in 

any manner to the assignment must be brought in court in Polk County, Iowa.

In June 2004, an involuntary bankruptcy petition was filed against 

NorVergence in New Jersey. 

In August 2004, Liberty Bank notified Etter that he was in default under the 

ERA. Thereafter, multiple, successive lawsuits involving NorVergence’s ERAs

commenced in several jurisdictions. We need not detail all the different lawsuits

or the filings in those lawsuits, which are well known to the parties, in order to 

reach our decision. Instead, we set forth only the pertinent procedural history 

necessary for the disposition of this appeal.

B. The Texas Attorney General Sues NorVergence in Harris County

On November 18, 2004, the Texas Attorney General filed suit against 

NorVergence, Inc. in the 270th District Court of Harris County on behalf of 1,020 

Texas small businesses that were victims of NorVergence’s fraud and deceptive 

acts and practices. The following day, the Texas Attorney General notified 

Liberty Bank by letter,

The Texas Attorney General has learned that your company is 

demanding payments from Texas small business consumers on 

agreements purchased from NorVergence, the New Jersey company 
4

now in Chapter 7 bankruptcy in New Jersey. We have reason to 

believe that these agreements are based on fraud and should be 

voided.

Please respond promptly to the attached Civil Investigative 

Demand. In the meantime, we request that you immediately cease 

all efforts to collect on agreements purchased from NorVergence 

until such time as there is a determination as to whether they are 

enforceable.

Continuing to attempt collection efforts on agreements 

secured by fraud could subject your company to substantial

penalties under Texas law. 

On April 29, 2005, the Harris County court granted the Texas Attorney 

General a default judgment against NorVergence. The default judgment stated 

that all contracts or agreements between NorVergence and Texas consumers, 

businesses, or persons “are hereby declared void ab initio and unenforceable.”

The default judgment further enjoined NorVergence and any other person in 

active concert or participation with NorVergence from enforcing, attempting to 

enforce, collecting, or attempting to collect any monies purportedly owed under 

any NorVergence ERA from any Texas consumer, business, or entity. In a letter 

dated June 6, 2005, Liberty Bank informed Etter that it was aware of this 

judgment. 

C. Liberty Bank Sues Etter in Iowa

Shortly before the Texas Attorney General brought suit in Harris County, 

Liberty Bank instituted proceedings against Etter in Iowa in October 2004. 

Almost four years later, on July 15, 2008, the Iowa court granted Liberty Bank’s 

motion for summary judgment. 
5

D. Etter Sues Liberty Bank in Tarrant County Court at Law Number Three

One day before the Iowa court issued its judgment, Etter sued Liberty 

Bank in Tarrant County Court at Law Number Three, seeking a declaratory 

judgment that the NorVergence ERA was void and unenforceable. That same 

day, County Court at Law Number Three issued a temporary restraining order 

restraining NorVergence, Inc.; NorVergence Capital, L.L.C.; and Liberty Bank, 

F.S.B. from taking any action to collect or attempt to collect monies from Etter, 

including any further proceedings in the Iowa suit, and from taking any action to 

enforce the ERA. 

E. Liberty Bank Sues Etter in Tarrant County Court at Law Number One

Four months later, in November 2008, in Tarrant County Court at Law 

Number One, Liberty Bank filed notice pursuant to the Uniform Enforcement of 

Foreign Judgment Acts of its intent to enforce the Iowa judgment. Etter filed a 

motion to vacate the judgment or stay its enforcement, asking that the Iowa 

judgment be vacated and declared null and void. Etter also filed a motion to 

consolidate the two county court at law cases. The parties later agreed to 

transfer Liberty Bank’s suit in County Court at Law Number One to County Court 

at Law Number Three. 

F. The Consolidated Tarrant County Cases

The parties filed competing motions for summary judgment. The trial court 

ultimately denied Liberty Bank’s motion for summary judgment and granted 

Etter’s motion for summary judgment, finding that “there is no question of 
6

material fact necessary to establish that the actions of the 270th Judicial District 

Court of the State of Texas rendered the contract upon which Defendant brought 

suit in Iowa void and thus deprived the Iowa court of subject matter jurisdiction.” 

This appeal followed.

III. ETTER CONCLUSIVELY ESTABLISHED HIS RIGHT TO 

SUMMARY JUDGMENT AS A MATTER OF LAW

Etter moved for summary judgment on the ground that the 270th District 

Court of Harris County had declared void ab initio and unenforceable the ERAs 

procured between NorVergence and Texas consumers or between finance 

companies and Texas consumers, including the ERA that Liberty Bank relied 

upon in its suit against Etter.3 Etter’s summary judgment evidence included the 

default judgment the Texas Attorney General obtained against NorVergence in 

the 270th District Court of Harris County; the November 2004 letter that the 

Texas Attorney General sent to Liberty Bank regarding the lawsuit in Harris 

County, along with the “Civil Investigative Demand” that the letter referenced; 

and Etter’s affidavit, which stated that Liberty Bank was aware of the Harris 

County judgment. In its first issue, Liberty Bank argues that the trial court erred 

by granting Etter’s motion for summary judgment because Etter’s summary 

judgment proof is insufficient and does not overcome the Iowa judgment’s fullfaith-and-credit presumption of validity. 

 

3Etter’s motion to vacate the Iowa judgment or to stay its enforcement, filed 

in response to Liberty Bank’s attempt to domesticate the Iowa judgment, also 

raised this exact point. 
7

We review a summary judgment de novo. Travelers Ins. Co. v. Joachim, 

315 S.W.3d 860, 862 (Tex. 2010). We consider the evidence presented in the 

light most favorable to the nonmovant, crediting evidence favorable to the 

nonmovant if reasonable jurors could, and disregarding evidence contrary to the 

nonmovant unless reasonable jurors could not. Mann Frankfort Stein & Lipp 

Advisors, Inc. v. Fielding, 289 S.W.3d 844, 848 (Tex. 2009). We indulge every 

reasonable inference and resolve any doubts in the nonmovant’s favor. 20801, 

Inc. v. Parker, 249 S.W.3d 392, 399 (Tex. 2008). A defendant is entitled to 

summary judgment on an affirmative defense if the defendant conclusively 

proves all the elements of the affirmative defense. Frost Nat’l Bank v. 

Fernandez, 315 S.W.3d 494, 508–09 (Tex. 2010), cert. denied, 131 S. Ct. 1017 

(2011); see Tex. R. Civ. P. 166a(b), (c). To accomplish this, the defendantmovant must present summary judgment evidence that conclusively establishes 

each element of the affirmative defense. See Chau v. Riddle, 254 S.W.3d 453, 

455 (Tex. 2008).

When both parties move for summary judgment and the trial court grants 

one motion and denies the other, the reviewing court should review both parties’ 

summary judgment evidence and determine all questions presented. Mann 

Frankfort, 289 S.W.3d at 848; see Myrad Props., Inc. v. Lasalle Bank Nat’l Ass’n, 

300 S.W.3d 746, 753 (Tex. 2009). The reviewing court should render the 

judgment that the trial court should have rendered. Mann Frankfort, 289 S.W.3d 

at 848.
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The Texas Attorney General is specifically authorized to bring an action in 

the public interest against an entity it believes is engaged in conduct prohibited 

by the DTPA. Tex. Bus. & Com. Code Ann. § 17.47(a) (West 2011); Bara v. 

Major Funding Corp. Liquidating Trust, 876 S.W.2d 469, 471 (Tex. App.––Austin 

1994, writ denied). One of the purposes of enforcement of the DTPA by the 

attorney general is to prevent a multiplicity of suits. Bara, 876 S.W.2d at 472. 

Here, the Texas Attorney General did just that and obtained a final judgment 

from the 270th District Court of Harris County declaring that all NorVergence 

ERAs were obtained in violation of the DTPA and were void ab initio. 

Liberty Bank complains that although it had actual knowledge of the Texas 

suit and the judgment signed by the 270th District Court of Harris County, it was 

not served with process in the Texas lawsuit and therefore cannot be bound by 

the Texas judgment. NorVergence assigned its ERA with Etter to Liberty Bank; 

as an assignee, Liberty Bank stands in the shoes of NorVergence. See, e.g.,

Burns v. Bishop, 48 S.W.3d 459, 466 (Tex. App.––Houston [14th Dist.] 2001, no 

pet.) (stating that “[i]t is axiomatic that an assignee or subrogee walks in the 

shoes of his assignor”). The fact that Liberty Bank, as NorVergence’s assignee, 

was not served with process in the Texas Attorney General’s DTPA suit does not 

result in Liberty Bank’s possessing more rights than its assignor, NorVergence. 

That is, Liberty Bank’s rights are dictated by its status as an assignee; because 

NorVergence’s ERA with Etter was void ab initio and because NorVergence 
9

possesses no right to enforce the ERA, NorVergence’s assignee Liberty Bank 

likewise possesses no right to enforce the ERA against Etter. See id.

Liberty Bank also argues that because NorVergence assigned Etter’s ERA 

to Liberty Bank before NorVergence’s bankruptcy, Liberty Bank’s assignment 

falls within an exception in the judgment and is still enforceable. In making this 

argument, Liberty Bank focuses on one part of the judgment providing that 

NorVergence consumer financing agreements assigned to a third party after 

those contracts were rejected in the bankruptcy case were void and uncollectible 

by any person or entity. This portion of the judgment cannot, however, be read in 

isolation; when read as a whole, the judgment’s declaration that all 

NorVergence’s ERAs are void ab initio is not temporally limited. To the contrary, 

another provision of the judgment enjoins NorVergence and “any other person in 

active concert or participation with” NorVergence from “[e]nforcing, attempting to 

enforce, collecting, or attempting to collect any monies purportedly owed under 

any NorVergence equipment rental agreement from any Texas consumer, 

business[,] or entity.” [Emphasis added.]

Liberty Bank also argues that Etter was not entitled to summary judgment 

because Texas courts must give full faith and credit to the Iowa judgment. But 

Liberty Bank has not cited any cases in support of this proposition that present 

facts comparable to the current facts. A Texas court found Etter’s ERA with 

NorVergence void ab initio before the Iowa court signed a summary judgment for 

Liberty Bank as assignee of NorVergence’s ERA with Etter that purported to 
10

enforce the ERA against Etter. Liberty Bank has not cited, and we are not aware 

of, any authority that Liberty Bank’s full-faith-and-credit argument applies to the 

present facts. As indicated by the trial court, “[a]s a matter of public policy[,] an 

action such as that pursued by the Attorney General in the discharge of his 

[c]onstitutional obligations must be given effect.” See Tex. Const. art. IV, § 2.

Liberty Bank further argues that Etter did not timely attack the Iowa 

judgment. But a void judgment, such as the one here, can be collaterally 

attacked at any time. See PNS Stores, Inc. v. Rivera, 379 S.W.3d 267, 272 (Tex. 

2012). The record reveals that Etter has been attempting to stop Liberty Bank’s 

efforts to enforce the void ab initio ERA since June 2005, when he originally filed 

suit in Tarrant County Court at Law Number Three requesting a temporary 

restraining order that would enjoin Liberty Bank from proceeding with attempts to 

collect monies from him and from proceeding with the suit against him in Iowa, 

and that he re-filed suit the day before the Iowa judgment was signed. We 

therefore conclude that under Rivera and the record presented here, Etter timely 

attacked the Iowa judgment as void ab initio. See id.

In summary, considering Etter’s summary judgment evidence in the light 

most favorable to Liberty Bank as the nonmovant, crediting evidence favorable to 

Liberty Bank if reasonable jurors could, and disregarding evidence contrary to 

Liberty Bank unless reasonable jurors could not, we hold that Etter conclusively 

established that he was entitled to summary judgment because the ERA 

assigned to Liberty Bank that it sought to enforce against him was void ab initio
11

and unenforceable. See Fielding, 289 S.W.3d at 848; Chau, 254 S.W.3d at 455. 

Because Etter established his right to summary judgment on this basis, we need 

not address the grounds for summary judgment presented in Liberty Bank’s 

competing motion for summary judgment. We overrule Liberty Bank’s first issue, 

which is dispositive of the appeal. See Tex. R. App. P. 47.1 (stating that 

appellate court needs to address every issue necessary for final disposition of 

the appeal).

IV. CONCLUSION

Having overruled Liberty Bank’s first issue, which is dispositive of the 

appeal, we affirm the trial court’s judgment.

SUE WALKER

JUSTICE

PANEL: GARDNER, WALKER, and MCCOY, JJ.

DELIVERED: September 19, 2013