### T E X A S C O U R T O F A P P E A L S , T H I R D D I S T R I C T , A T A U S T I N

NO. 03-17-00811- CV

Appellan t, Harr is Coun ty Hospital District // Cross- Appellan ts, P ubl ic Utility Com m ission of T exas and S outhw este rn Bell Telephon e Com pany d /b/a AT &T Texas

v. Appellees, P ubl ic Utility Com m ission of T exas and S outhw este rn Bell Telephon e Com pany

d/b /a AT&T Texas // Cross-Appellee, Harris County Hospital District

F ROM TH E DISTRI CT COURT O F TRAVIS CO UNTY, 250 TH JUDICI AL DISTRICT NO. D-1 -GN-1 5-0 0580 8, H ONO RAB LE SCO TT H . JENK INS, J UDGE P RESIDING

O P I N I O N

This is a suit for judicial revie w pursuant to the Administrative Procedur e Act, Tex. Gov’t Code §§ 2001.001–.902. The Har ris County Hospital District filed a complaint wi t h the Public Utility Commi ssion (PUC) contesting cer tain fee s Southwestern Bell Telephone Company char g ed its telecommunica tions customers in the 1990s. Southwestern Be ll’s succe ssor in interest, AT& T, contends the fee dispute was resolved by a class-a ction settlement in 2 0 0 0

. T he PUC ultimately dismiss ed the complaint, holding the Hospital District’s claims barr ed by res judicata due
t o t h e class-action settlement. The district court reve rsed that order , holding that the Hos p i t al District is not bound by the s ettlement because it was not represe nted i n that action in acc ordanc e with Section 281.056(b-1) of the Hea lth and Safety Code, which require s a county or district attorney to repr esent cer

tain hospital districts “in all leg al matters.” See Tex. Hea lth & Safety C o de§ 281.056(b-1) (2) (requiring such represe ntation in any county “with popul ation of 3.4 m i l l i o n or

more” ). We ag ree with AT& T and the PUC that the Hospital District is bound by the disputed settlement decr ee. We will there fore reve rse the district court’s order and re n der judgme nt dismiss ing the case . See Tex. R. App. P. 43.2 (re quiring this court to rende r the judgme nt the trial court should have rende red)

. I BACK GR OUND Telec ommunications utilit ies in Texas may char g e customers a fee to rec over cer tain
costs resultin g from use of publ ic rights of way

. These “municipal fees” are gove rned by Section 54.206 of t he Util ities Code, which allows the ut il i t y “to collect a fee that a muni cipality imposes

. . . throug h a pro rata char g e to the custom ers [ with] in the boundaries of t he muni cipa l i t y . ” Tex. Util. Code § 54.206(b). For more than two deca des, customers have alleg ed that Southwestern Be ll imposed excessive municipal fee s throug hout the 1990s, resulting in sever al l aw s uits. Four are rele vant her e.

The Mirales Settlem ent

L itigation commence d in 1998 in Cameron County when two residential customers sued Southwestern Be ll and alleg ed the utilit y had been char g ing excessive municipal fee s since October of 1991. The parties ultimately neg otiated a cy pres class-a ction settlement—now known

as the Mirales Settlement—to resolve all rela ted claims in Texas. The proposed settlement define d the putative cla ss as:

2[A] ll pe rsons and entities who curr ently reside in the State of Texas who subscribe,

or former ly subscribed, t o t elephone service provided by [S outhwestern Be ll] and pay , or paid, to [S outhwestern Be ll] a municipal fee imposed pursuant to a municipal ordinanc e, other than an ordinanc e based on a perc entag e of g ross rec eipts, and collecte d pursuant to a tar iff or statute.

That definition excluded cer tain customers not rele vant here , including employ ees of Southwestern Be ll and the district court.

The proposed settlement, once acc epted by the district court, would prohibit a ny class

mem b er from pursuing any claim arising from Southwestern Be ll’s collection of these alleg edly excessive fe es:

“Relea sed Claims” means any and all claims, rig hts, cause s of action, suits, matters, iss u es , controve rsies, or other bases for liability , whether known or unknown, that have been, could have been, or that might be asse rted here afte r in the L awsuit or in any other court or administrative or reg ulatory proce eding

. . . which hav e arisen, arise now, or here afte r may ar i s e o r rela te in any way to the pass-throug h or collection of municipal fee s in Texas, including all cause s of action that are or could be raised un d er Plaintiffs’ pleading s on file here in or that consumers or customers could ra ise in relation to Southwestern B ell’s pass-throug h of municipal fe es.

I t continues, “Any m em ber of the Settlement Class who has not proper ly and timely reque sted exclusion from the Settlement Class shall be bound by any and all judgme nts, settlements, or rele ases enter ed or approve d by the Court w hether favor able or unfavor able to the class.” See Tex. R. Civ. P. 42(c)( 2)(B )(v) (establishing putative class membe r’s rig ht to opt out of class).

After allowing the parties time to notify putative class members of the proposed settlement, the district court held two hear ings o n t h e fairness of the proposed cer tification and settlement. At the first hear ing, cer tain commerc ial customers objected to the putative class as too

3varian t t o s at i sfy the commonality require ment of cer tification. See id. R. 42(b)( 3) (re quiring

common questions of law and fac t to “pre dominate” over any individual questions). This challeng e

was led b y S outhwestern Tarif f Analy st (STA), a telecommunica tions billing auditor that had attempted to interve n e as n amed plaintiff but whose petition in intervention had been stricken on Southwestern B ell’s motion.

The district court continued the hear ing to aff ord Southwestern Be ll time to addre ss the objections to cer

tification. The hear ing resumed a wee k later, and the repor ter’s rec ord ref

lects that STA offe red to withdraw its objections and waive any rig ht to appea l the intervention ruling if Sou t h we s t er n Be ll would prese rve STA’s rig ht to bring a separ ate class action on behalf of g overnme ntal and commerc ial customers. Southwestern Be ll declined to chang e the class definition but ag ree d not to raise res judicata or rela ted defe nses “in any class action lawsuit broug ht by STA

as plaintiff.” The ag ree ment was memorialized under Rule 11 and dictated into the repor ter’s rec ord. The district cour

t then cer tified the cla ss and ac cepte d the settlement proposa l. On May 4, 2000, the court’s final judgme nt “g rant[ed] final approva l to the Settlement Ag ree ment” and d ee m ed it “in all respe cts, fair, rea sonable, adequate, and in the best interests of the Settlem en t Class.” The judgme nt indicates that all objections wer e “c ar ef ully considere d and [were] all

overr uled.” The district court later issued a judgme nt nunc pro tunc to corr ect cer tain ty pog raphic al and cle rica l error s in the final judg ment.

The STA Sui t After the Mirales Class settled its claims, STA filed a class action in 2003, proposing
to repr esent near ly 7,000 g overnme ntal and commerc ial cu s t o m er s with respe ct to any rema ining

4claims arising from the same alleg edly excessive fee s. See Southwestern Bell Tel. Co. v. Marke ting

on Hold, Inc ., 308 S.W .3d 909, 914 (Tex. 2010) ( STA ). The Hospital District was identified by the class repr esenta tive and separ ately by Southwestern Be ll as one of these putative class members, but no attorney

other than c lass counsel a ppear ed on beha lf of the Hospital District. The district court eventua lly cer tified the class and the court of appea ls aff irmed, but the Supreme Court of Texas reve rsed, holding that STA—as the only named plaintiff—had not met its burden to show it could adequa tely repr esent the class. See Tex. R. Civ. P. 42(a) (re quiring , inter alia, a showing that “the repr esenta tive parties will fairly and adequately protec t the in tere sts of the class” ); STA , 308 S.W .3d at 27 (“A lthough STA satisfied the ty picality and predominanc e require ments to be a class repr esenta tive

. . . it failed to establish that it is an adequate class re prese ntative.”)

. The Harris County Su it

A series of merg ers left AT& T as succe ssor in in te r e st to Southwestern Be ll’s liability arising from this fee dispute. Shortly afte r the Supreme Court of Texas overr uled cer tification of the STA class in 2010, the Hospital District sued AT& T in H arr is County district c ourt, reiter ating the statutory challeng e to t he same fee s litigated in Mirales and STA

. The Hospital District conc eded the simil arity of the alleg ations but arg ued its claims wer e “ca rved out” of the rele ased claims by the Rule 11 ag ree ment and thus that it is not bound by the Mirales Settlement. The district court did not

rea ch that arg ument, instead acc epting AT& T’s response that the claims arise from a fee dispute that falls within the PUC’s exclusive jurisdiction. See Tex. Util. Code § § 1 7

. 157, 52.002, 54.206. I t dismiss ed any “cla ims that seek[] reimburse ment of municipal char g es under tariff ,” and abate d the

5rema i n i n g “c l aim s for additional damag es based on Gross Neg lige nce, Fr aud and/or the Texas

Dec epti v e T ra d e Practice s Act” pending the PUC’s resolution of the fee dispute. The Hospital District appar ently did not file an appea l or seek mandamus relief from the dismiss al or abate ment.

The PU C Com plain t

The Hospita l Di s t ri ct submitt ed its fee complaint to the PUC in Marc h of 2012. AT& T responde d with a mot ion to dismiss and a motion for summar y decision charac terizing the Hospital District’s alleg ations as injusti ciable due to the Mirales Settlement and the doctrine of res judicata. See Citi

zens Ins. C o . o

f A m. v. Dacc ach , 217 S.W .3d 430, 450 (Tex. 2007) (“B asic principles of res judicata apply to class actions just as they do to any other form of litigation.” (citing Matsushita Elec. Indu s . C o . v. Epstein , 516 U.S. 367, 377–79 (1996); Cooper v. Federal Reserv e Bank , 467 U.S. 867, 87 (1984); Southwestern Ref. Co. v. Bernal , 22 S.W .3d 425, 432 (Tex. 2000)))

. The PUC ref

err ed the question of justiciabilit y to an administrative law judge (AL J ) at SOAH. The AL J denied the motion to dismiss and the motion for summary decision. After more than three y ear s of litigation over the complaint filed at the PUC, the AL J rende red a proposal for decision rec ommending dismiss al of the matter. He explained, “Unde r the doct rine of res judicata, all of the claims asser ted by [t he Hospital District] in this proce eding are barr ed by the Mirales Final J udg ment approving the Mirales Class Action Settlement.” The PUC subsequently adopted the proposal for decision, including its finding of fac ts and conclusions of law, and issued an or der dismissing the H ospital District’s complaint.

The Hospital District soug ht judicial revie w in Dec ember of 2015, naming the PUC

as defe ndant. AT& T later intervene d in the case . As the primary basis for its challeng e to the PUC’s
6order , the Hospital District arg ued that it could not have been a member of the Mirales Class beca use Section 281.056 of t he Health and Safe ty Code—as it exis ted at the time—provide d, “The county attorney , district attorney , or criminal district attorney , as appropr iate, with the duty to repr esent the county in civil matters[,] shall repr esent the district in all leg al matters.” See Tex. Hea lth & Safety Code § 281.056(b) (West 1998)

. I t is undisputed that no such attorney appea red or filed pleading s

on behalf of the District during the Mirales litigation. The district court ultimately reve rsed the PUC’s final order :

As a matter of law, pursuant to Sec tion 281.056, Texas H ealth & Safety Code, [the Hospital District] must be repr esente d by the county attorney unless its board opts to reta in outside co u n s el

. No such counsel repr esente d [t he Hospital District] in the Mirales lawsuit. As a leg islatively -cr eate d g overnme ntal enti t y [,] [t he Hospital District] cannot be par

t of or bound by

a cla ss[ -] action lawsuit unless it take s such action to par

ticipate in the lawsuit. Consequently , as a matter of la w, [the Hospital District’s] claims wer e not resolved by the Mirales lawsuit nor resolved by its final judg ment. All three pa

rties filed timely

appea l.

II

DISCUSSIO N The parties raise three issues on appea l. First, the Hospital Di s t ri ct contends the district court should have held the 20-y ear -old Mirales Settlement void beca use the rele ased claims arise from a fee dispute that falls within the exclusive jurisdiction of the PUC. Second, the PUC and AT& T contends t h e d i s t ri ct court err ed by reve rsing the PUC’s order and holding the Hospital District not bound by the Settlement’s rele ase. Third, the Hospital District contends that, even assuming the Mirales Settlement is not void and the Mirales Class can be construed to inc lude the

7Ho spital District such t hat i ts claims would otherwise be barred by rele ase or res judi ca t a, AT &T

should be judi cially estopped from urg ing this Court to include the Hospital Dist ri ct i n t h at class. We addre ss these ar g uments in turn.
A. The Hospi tal Distric t Cannot P revail on Its Collater al Challenge.

The Hospital District contends the Travis Co u n ty d is tr ic t court err ed by failing to hold the Mirales Settlement void. I n support, the Hospital District arg ues that the Har

ris County district
court corr ectly held the fee dispute within the PUC’s exclusive j u ri sdiction and thus that the Cameron County district court could not have had jurisdiction over the same fee dispute during the Mirales litigation. Acc ording to the Hospital District, without jurisdiction over the subject matter, the Cameron County district court could not have cer tified the class and acc epted the settlement. We revie w this challeng e de novo. See Gauci v. Gauci , 471 S.W .3d 899, 901 (Tex. App.—Houston [1st Dist.] 2015, no pet.) (citing Tex. N atural Res. Conservation Comm’n v . IT–Davy , 74 S.W .3d 849, 855 (Tex. 2002)).

We beg in by noting that this is not a jurisdictional challeng e raised on direc t appea l. I nstead, the Hospital Distr ic t collater ally challeng es a twenty -y ear -old class-a ction settlement decr ee resolving tens of thousands of claims filed over two deca des ag o. Courts g ener ally will not enter tain collater al challeng es to final order s, as the law favor s finality and cer tai n t y . S

ee Browning

v. Prostok , 165 S.W .3d 336, 345 (Tex. 2005) (citing Tice v. City of Pasadena , 767 S.W .2d 700, 703 (Tex. 1989); Crouch v. McG aw , 138 S.W .2d 94, 96 (Tex. 1940)). Howeve r, collater al challeng e is proper if the disputed judgme nt is alleg edly void. See Browni n g v. Placke , 698 S.W .2d 362, 363 (Tex. 1985) (per curia m) (orig

. proce eding ). A judgm en t i s v o i d only if “the court rende ring
8judgme nt had no jurisdiction of the parties or proper ty , no jurisdiction o f t he subject matter, no ju r is d ic ti o n to e n te r th e p a

r ti c u la r ju d g me n t, o r n o c a

p a c it y to a c t. ” P

NS S to r e s , I n c . , 3 7 9 S. W. 3 d 2 6 7 , 272 (Tex. 2012) (citing Travelers Ins. Co. v. J oachim , 315 S.W .3d 860, 863 (Tex. 2010)). As the S upreme Court o f T ex as recently noted, “the traditional doctrine was t hat a judgme nt of a court shown to have lacke d subject matter jurisdiction was void” such that no further inquiry was nece ssary to resolve the collater al challeng e. Engelman Irrigation Dist. v. Shields Bros., Inc ., 514 S.W .3d 746, 752 (Tex. 2017) (quoting Restatement (Second) of J udg ments § 12 cmts. a, b (Am. L aw. I nst. 1982)) (inter nal quotation marks omitted). Howeve r, the Restatement adopts a “‘mode rn rule on conclusivene ss of deter minations of subject matter jurisdiction

. . . g iv[ ing] finality substantially g rea

ter weig ht.’” Id. The Engelman Court made these observa tions while considering whether to hold a twenty -y ear -old judgme nt void based on retroa ctive application of more rec ent prec edent on sovere ign immunit y —a doctrine well established as implicating jurisdicti on over subject matter. Id. at 748. After explaining that t h e m o d er n approach would bar this attempted collater al challeng e due to the need for finality in the dispute, the Court ultimately reje cted the plaintiff’s arg ument and declined to rec og nize retroa ctive application of new prec edent as a basis for collater al cha lleng e. Id. at 755.

Although the Engelman Court did not rest its holding on Section 12 of the Restatement of J udg ments, it acknowledg ed the moder n trend fa voring finality and certainty

. See id. at 750. This approa ch require s the revie wing court to weig h any fac tors milit ating for and ag ainst upholdi ng the validity of the challeng ed judgme nt. See Restatement (Second) of J udg ments § 12 (Am. L aw. I nst. 1982). These fac tors may vary in any g iven case , but include the ag e of the disputed

9judgme nt, the number of parties aff ecte d by that judgme nt, the brea dth of the orig inal tribunal’s jurisdiction, the extent t o wh i ch t hat tribunal made a jurisdictional deter mination, and the challeng er’ s participa tion in the litigation that resulted in the disputed judgme nt. See id. I n t he p rese nt case , ever

y rele vant fac tor weig hs in favor of finality —“an anchor ing principl e o f an y functioning and eff

icient judicial sy stem.” See Engelman , 514 S

. W

. 3 d at 753. The challeng ed judgme nt is near ly two deca des ol d, binds tens of t housands o f class members, was render ed by a court of g ener al jurisdiction, and includes a statement indic at i n g that the court found jurisdiction over “ all claims” a

nd “all par

ties.” But perha ps more importantly , the Hospital District—as party to this litigation—has had ample opportunity to litigate its jurisdictional challeng e. “A p ar t y t hat has an opportunity to litigate the question of subj ect matter jurisdiction may not at a later

time reope n that question in a collater al attac k upon an adve rse judg ment.” Bass v. Champion I nt’l Corp ., 787 S.W .2d 208, 212 (Tex. App.—B eaumont 1990, no writ) (citing Chicot Cty. Drainage Dist. v. Baxter State Bank , 308 U.S. 371 ( 1940)); see also Insuranc e Corp. of Ir., Ltd. v. Compagnie des Bauxites de Guinee , 456 U.S. 694, 702 n.9 (1982) (“A party that has h ad an o p portunity to litigate the question of subject-matter jurisdiction may not, h o we v er , reope n that question in a collater al attack upon an adver se judgme nt.”); Kortebein v. Ame r i ca n Mut. Life Ins. Co. , 49 S.W .3d 79, 88 (Tex. Ap p .—Austin 2001, pet. denied) (“Absent class members’ due-pr ocess rig ht to adequat e repr esenta tion is protec ted by the adoption of appropr iate proce dures by the cer tify ing court and by appea l

. . . . Due process does not require collater al s econd- g uessing of t hose determi n at i ons and
t h at re v i ew.” ). After revie wing the rec ord, the PUC conclude d Southwestern Be ll’s customers

10rec eived a dequate notice of the Mirales litigation i n 2000, and the Hospital District doe s not deny

it rec eived that notice. See Tex. R. App. P. 38.1(g ). The Hospital District coul d h av e ra ised this arg ument at that time. I n addition, the Hospital District conce des its membership in the putative STA class, whose named repr esenta tive soug ht relief from the same disputed fee s in district court. And althoug h the Supreme Court ultimately deeme d that class uncer tifiable in 2010, the Hospital District could have raise d this arg ument befor e that deter mination. Be cause the rele vant fac ts and circ umstances of this case —including the Hospital Dis tr ic t’ s o p p o r

tu n it y to li ti g a te th is jurisdictional challeng e in Mirales and STA —weig h in favor of finality , we re j ec t i t s prese nt challeng e to the Mirales Final Judgment. We over rule the H ospital District’s first issue.

B. Th e Hospital District Is Bound by Mirales.

The crux of this dispute is whether the PUC corr ectly held that the Mirales Class includes the Hospital District or the district court corr ectly reve rsed that holding. AT& T contends the PUC “cor

rec tly found [t he Hospital District’s] claims are barr ed by a straig htforwa rd application of the Mirales Settlement’s rele ase provision.” Simi larly , the PUC, as party to this appea l, arg ues: [The Hospital District’s] claims are barr ed by the Mirales settlement and judgme nt in two distinct was. First, the doctrine of res judicata prec ludes [t he Hospital District], a Mirales class member, from relitig ating the exact claims adjudicate d and resolved in Mirales

. . . . Second, setting asid e re s j u d i cata, the exact claims [t he Hospital District] presses in this l awsuit wer e re lease d in Mirales

.

We ag ree with AT& T and the PUC that the prese nt claims are barr ed by t h e re l ea s e i n the Mirales Settlement.

111. The Hospital Dis trict’s Claim s Were Release d by the Mirales Settlem ent

. T h e P UC is corr ect that the Mirales Settlement expressly rele ases the claims the Hospital District attempts to bring here

. “‘A settlement ag ree ment is a contra ct, and its construction is g o v e r n e d b y le g a l p r in c ip le s a

p p li c a b le to c o n tr a c t s g e n e r a l l y . ’ ” G a r z a v . V i l la r r e a l , 3 4 5 S. W. 3 d 4 7 3 , 479 (Tex. A

pp.—San Antonio 2011, pet. denied) (quoting Donzis v. McLaughlin , 981 S.W .2d 58, 61 (Tex. App.—San Antonio 1998, no pet.)). “I t is the g ener al rule of the law of contra cts that wher e

an unambig uous writing has been enter ed into betwee n the parties, the Courts will g ive eff ect to the intention of the parties as expressed or as is a ppare nt in the writing .” City of Pinehurst v. Spooner Addition W

ater Co. , 432 S.W .2d 515, 518 (Tex. 1968). We revie w the interpre t at i o n of an unambig uous contra ctual provision de novo. See URI, Inc. v. Kleberg County , 543 S.W .3d 755, 763 (Tex. 2018). The Mirales Class is define d in rele vant part as “all persons and entities who cu r r e n tl y reside in the State of Texas who subscribe, or former ly subscribed, to telephone service provided by [S out h we s t er n Be l l ] and pay , or paid, to [S outhwestern Be ll] a municipal fee

. . . .” None of the parties char acte rizes this lang uag e as ambig u o u s , and the Hospital District does not deny it is an entity who subscribed to telephone service from Southwes t er n Be l l and paid the municipal fee s during the di s puted period. Southwestern Be ll’s rec ords confirm as much. Thus, the Hospital District is a member of

the Mirales Class. The claims rele ased in the Mirales Settlement include “any and all claims which have arisen, arise now, or here afte r may arise or rela te in any way to the pass-throug h or col l ec tion of

m u n icipal fee s in Texas.” Ag ain, the parties and this Court are in ag ree ment that the lan gu age i s

12unambi gu o u s . Thus, we turn to the ordinary meaning of the terms to interpre t the clause

. Bla ck

define s “ar ise from” as to “orig inate from,” “stem from,” or “re sult from.” See Arise, Black’ s Law Dictionary (10th ed. 2014). I n the pre sent suit, the Hospital District alleg es: [S outhwestern Be ll’s] failure or ref usal to ref

und the Unauthorized Charg es [i .e., municipal fee s char g ed in excess of statutory g uidelines] constitutes a materia l brea ch of contra ct and a violation of tariff , substantive rule[s] and P URA, and has resulted in unlawful rate s being char g ed and collecte d by [S outhwestern Be ll] from [t he Hospital District].

Eac h of these claims orig inates, stems, and results from Southwestern Be ll’s collection of alleg edly impermissible municipal fee s. The Hospital District’s claims there fore arise from the collection of those fee s and fa ll within t he scope of the Mirales Settlement’s rele ase.

The Hospital District, howeve r, arg ues that the unambig uous lang uag e of this rele ase does not apply to its case beca use t hat l ang uag e does not acc urate ly ref lect the claims the Mirales parties intended to rele ase. A settlement rele ase is g overne d by the law of contra cts and is there fore limit ed by any defe nses available in contra ct law. See W illiams v. Glash , 789 S.W .2d 261, 264 (Tex. 1990). As the party seeking to avoid this unambig uous rele ase, the Hospital District bear s the burden of demonstrating an applicable defe nse, such as fra ud, mutual mistake, or lack of consideration. See id. (“[O]nce the aff

irmative defe nse of rele ase has been pleade d and proved, the burden of proof is

on the party seeking to avoid the rele ase to establish mutual mistake.”). The Hospital District offe rs the repor ter’s rec ord from the Mirales cer tification hear ing as evidenc e that the parties never intended to re lease its claims as part of the Mirales Settlement. As the Hospital District desc ribes it, the parties “ca

rve[d] out claims reg arding cer tain business customers” —alleg edly including the

13Hospital District—“fr om the class action.” Yet the e vidence offe red by the Hospital District does
not support its ar gument. The Hospital District is corr ect that counsel for AT& T dictated cer tain stipulations into the rec ord as part of a Rule 11 Ag ree ment acc epted by the court, but at no point did AT& T or the court adopt any claim definition or class definitio n o t h er t h an those stated in the Mirales Settlement. 1

The Hospital District also contends it is neither fair nor prudent to hold g overnme ntal entities bound by class-a ction settlements unless those entit i es af fi rm atively choose to “opt i n” to the action. But Tex as l aw requires putative class members t o o p t o u t of a settlement to avoid t he binding eff

ects of class action. See Tex. R. Civ. P. 42(c) (2)( B) (v); E n t ex v. City of Pearland , 990 S.W .2d 904, 913 (Tex. App.—Houston [14t h Dist.] 1999, no pet.) (“The trial court rec og nized the problems with the opt-out provisions of the class action and expressed its pref ere nce for an opt-in notification of class action, which is not available in Texas.”), abrogated on other grounds , Tracker Marin e, L

. P

. v. Ogle , 108 S.W .3d 349, 351 (Tex. App.—Houston [14t h Dist.] 2003, no pet.); Enterprise Concepts, Inc. v. Finnell , 964 S.W .2d 348, 349–50 (Tex. App.—B eaumont 1998, no pet.) (empha siz ing the opt-in provision of the Fa ir L abor Standards Act, 29 U.S.C. § 216(b), and char acte rizing the suit as “not a true class action under R u l e 42 of the Texas Rules of Civil Procedur e” due to this prerequisite to class membe rship). The H ospital District has not identified any authority distinguishing go v er nmental entities from private entities with respe ct to the proce dures g overning class membership under state law, and courts may not “re quire a part i cu lar proce dure when the leg islature has not seen fit to do so itself.” Matthews v. Scott , 268 S.W .3d 162,

We discuss the Rule 11 Ag ree ment in further detail in our discussion of estoppel, infra

. 1 14173 (Tex. App.—Corpus Christi 2008, no pet.) (citing City of Rock wall v. Hughes , 246 S.W .3d 621, 631 (Tex. 2008)). Thus, ev en as s u m i ng any merit to the Hospital District’s policy arg uments

re garding the eff

ect of class-a ction settlements on g overnme ntal entities, we would defe r to t h e L eg islature to make a

ny chang es to the rules g overning class ac tions. Be cause the unambig uous definitions in the Mirales Settlement include the Hospital District and its alleg ations, and beca use the Hospital District offe rs no persua sive basis for contra ct avoidanc e, we conclude its claims fall within the scope of the rele ase.

2. Section 281.056 Does Not Exem pt the Hospi tal Distri ct from t he Release

. The Hos p i t al District arg ues t hat even if its claims would otherwise fall within the Mirales Settlement’s rele ase, the Hospital District is not bound by that rele ase beca use it was not repr esente d in the manner require d by statute when the Cameron County district court rende red final judgme nt. Section 281.056 of the Hea lth a nd Safety Code provides, “The county attorney , district attorney , o r crimi nal district, as appropr iate, with the duty to repr esent the county in civil matters shall repr esent the dis t ri ct i n all leg al matters.” See Tex. Hea lth & Safety Code § 281.056(b). Acc ording to the Hospital District, “The plain lang uag e of Section 281.056 require s the prese nce of the Harris County Attorney in ‘all l eg al m atters.’ ” Ba sed on the undisputed fac t that this attorney

was never prese nt in court and filed no pleading s in the Mirales litigation, the Hospita l District rea sons that it wa s n o t “r epre sented” in acc ordanc e with the statute. We find the arg ument unavailing

.

“When interpre ting a statute, our primary objective is to asce rtain and g ive eff ect to the L eg islature’s intent without unduly restric ting or expanding the Act’s s co p e. ” Gr eater Hous.
15P’ship v. Paxton , 468 S.W .3d 51, 58 (T ex . 2 0 1 5 ) (citi ng City of Lorena v. BMTP Holdings, L.P. ,

409 S.W .3d 634, 641 (Tex. 2013)). “We seek that intent first and fore most in the plain meaning of the text.” Id. at 58 (c iting Lorena , 409 S.W .3d at 641; Texas Lottery Comm’n v. First State Bank , 325 S.W .3d 628, 635 (Tex. 2010)). “‘U ndefine d terms in a statute are ty pically g iven their ordinary meaning

. . . .’” Greater Hous. P’ship , 468 S.W .3d at 58 (quoting TGS–NOPEC Ge ophysical Co. v. Combs , 340 S.W .3d 432, 439 (Tex. 2011)).

“R epre sent” is not define d in Section 281.056, so we turn to its ordinary m ea n i n g. See id. Courts ha

ve define d the verb as “[to] fill the place of for some purpose: substitut e in some capa city .” See Thomas v. United Parcel Serv., Inc ., 890 F.2d 909, 917–18 (7th Cir. 1989) (quoting W ebster’s Third New International Di ct i o nary 1926 (3d ed. 1981)). Simi larly , Merr iam define s “re pre s en t ” as “to manag e the leg al and business aff airs of.” See Merriam-W ebster’s Collegiate Dictionary 1057 (11th ed. 2008). T he Random House definition of “repre sent” is “to s tand or a ct in the place of, as an ag ent does.” The Random House College Dictionary 1120 (Revised ed. 1984). And Am er i ca n He ri t ag e define s the word as “to act as a spokesper son for.” American Heritage Di ct i o n a r y of the English Language 1490 (5th ed. 2015). None of these definitions supports th e Hospital District’s arg ument that an attorney m u s t be “pre sen[t] ” in court or file pleading s to repr esent a client. Particularly in the context of g overnme nt and in-house counsel, attorney s routinely repr esent their clients by advising them not to intervene , not to file responsive pleading s, etc. But these attorney s are still repr esenting their clients by advising them, manag ing their aff airs, and ac ting on their behalf

. Thus, the attorne y s delineate d in Section 281.056 need not nec essar ily appea r in court or

file plea dings to c omply

with the repr esenta tion directive.

16The Hospital District complains that the county attorney ’s office had no opportunity

to provide advice pursuant to the statute beca use no one notified that office of the Mirales litigation. This arg ument implies that the named plaintiffs, the court, or class counsel had an obliga tion under Section 281.056 to notify the county

attorney of the c lass action. But the statute offe rs no support for such a construction. To the contra ry , while other statutes place the burden to notify g overnme nt counsel on the plaintiff or the presiding court, cf. T ex . Gov’t Code § 402.010, this statute’s only burden is place d on the county attorney itself. See id. § 311.016(2) (“‘ Shall’ imposes a d u ty .’”)

. Moreove r, the rec ord ref lects that the Hospital District i t self rec eived adequa te notice of the proposed class-a ction settlement. The Hospital District does not d eny it rec eived that notice. To wh ateve r extent the county attorney was unawa re of the litigation, that unawa rene ss would h av e resulted, at least i n part, from the Hospi tal District’s failure t o apprise the attorney of t he p en d i ng class action. Thus, under the Hospital District’s interpre tation of this Section, it could simply avoid unwanted litigation by failing to notify the county attorney

. This is not a rea sonable construction of the statute. See Tex. Gov’t Code § 311.021(2)–(3) (re quiring courts to presume the leg islature intended a just, rea sonable, and eff ective result in enac ting statute). Be cause the Hospital District’s proposed construction is not rea sonable and is inconsistent with the lang uag e of the s t at u t e, must reje ct that construc tion.

We sustain the issue raised by AT& T and the PUC.
C. AT&T Is Not Estopped f rom Seeking to Bin d the Hospi tal Distric t. I n the final issue befor e this Court, the Hospital District contends AT& T is judicially estopped from char acte rizing the Hospital District as a member of the Mirales Class. I f the Hospital
17District is corr ect, any err or in the District C o u rt ’s analy sis was harmless and its order cannot be

reve rsed. See Tex. R. App. P . 44.1(a)

.

“‘ J udicial estoppel is a common law doctrine that preve nts a party from assum i n g inconsistent p o s i t i o ns in litigation.’” Perrym an v. Spartan Tex. Six Capital Partners, Ltd. , 546 S.W .3d 110, 117 (Tex. 2018) (quotin g Kane v. N at’l Union Fire Ins ., 535 F.3d 380, 385 (5th Cir. 2008)). Be cause judicial estoppel is an aff irm at i v e d ef

ense, the party urg ing estoppel has the b u r d e n to c o n c lu s iv e ly p r o v e e a c h e le me n t. S e e A n a d a r k o P e tr o l. Co r p . v . Th o m p s o n , 9 4 S. W. 3 d 5 5 0 , 553 (Tex. 2002) (listing as af fi rm ative defe nse); OAIC Comm’l Assets, L.L.C

. v. Stonegate Vill., L.P. , 234 S.W .3d 726, 742 (Tex. App.—Dallas 2007, pet. denied) (stating burden) ; Southwest Guar. Tr. Co. v. Providenc e Tr. Co. , 970 S.W .2d 777, 782 (Tex. App.—Austin 1998, pet. denied) (same)

. Appellate courts g ener ally revie w judicial est oppel for an abuse of discretion. See Perrym an , 546 S.W .3d at 117.

The elements o f

ju d ic ia l e s to ppel are : “(1) a sworn, prior inconsistent statement made in a judicial proce eding ; ( 2) the party now soug ht to be estopped succe ssfully maintained the prior position; (3) the prior inconsistent statement was not made inadver tently or beca

use of mistake, fra ud, or duress; and (4) the statement was delibera te, clea r and unequivoca l.” In r e Ma r r i age of B u t t s , 4 4 4 S.W .3d 147, 151 (Tex. App.—Houston [14t h Dist.] 2014, no pet.) (citing Spera v. Fleming, Hove nkamp & Grayson, P.C. , 25 S.W .3d 863, 871 (Tex. App.—Houston [14t h Dist.] 2000, no pet.); Vinson & Elkins v. Moran , 946 S.W .2d 381, 396 (Tex. App.—Houston [14t h Dist.] 1997, writ dis m ’d b y agr . )). To satisfy the first element, the party seeking estoppel must conclusively demonstrate that the opposing party “alleg ed or admitte d i n h i s pleading s in a

18former proce eding

. . . the contrary to the assertion soug h t t o b e m ade” i n the present proce eding

.

Long v. Knox , 291 S.W .2d 292, 295 (Tex. 1956) (citing 31 C.J .S. Estoppel, § 121 (195 5 )) (o ther citations omitt ed).

The Hospital District cannot preva il on this defe nse beca use it has not identified any prior inconsistent sta tement by Southwestern Be ll or AT& T. As evidenc e of such a statement, the Hospital District produce d the transcr ipt from the final hear ing on cer tification of the Mirales Class. The Hospital District contends this transcr ipt shows that Southwestern Be ll “ente red into a Rule 11 ag ree ment

. . . to car

ve out claims [of] cer

tain business customers from the class action

. . . including [t he Hospital District’s].” This char acte rization is contra dicted by the transcr ipt itself. T h e tr a n s cript confirms that the parties enter ed int o the R ule 11 Ag ree ment and dictated that agr ee m en t into the

rec ord. That ag ree ment, h o we v er , d i d not “ca rve out” any class members or claims from the proposed settlement. I nstead, STA—the only rema ining c halleng er to certifica tion of t he Mirales Class—“ag ree [d] to withdraw all of its objections to t he settlement of the Mirales lawsuit.” I n exchan ge fo r t h e withdrawn objection, Southwestern Be ll ag ree d that it would not asser t “any judgme nt, ruling , order [,] or ac tion of the C ourt in the Mirales lawsuit” as a defense to any “cla ss action lawsuit broug ht by STA as plaintiff (whe ther the lawsuit is ultimately cer tifi ed as a cl as s action or not)

. . . in which STA asser ts the STA claims for itself and on behalf of a class of simil ar situation persons or entities.” But at no point in this rec ord did S o u t h we s t ern Be ll sug g est that g overnme ntal or commerc ial customers lie outside the Mirales Class, and at no point did it deviate from the unambig uous lang uag e of the class definition, which includes all “entities who c urre ntly

19reside in the State of Texas who subscribe, or former ly subscribed, to telephone service provided by

[S outhwestern B ell].” The Hospital District does not deny that it constitut es such a

n entity

. Nor was Southwestern Be ll’s subsequent litigation of the STA class action inconsistent with AT& T’s current posit ion re gar ding the binding effe ct of the Mirales Settlement

on the Hospital District. The Hospital District arg ues otherwise, pointing to a list of putative class members that includes the Hospital District. I t further alleg es that Southwestern Be ll “litiga ted the STA case acc epting and aff irmatively arg uing that the proposed class members in that case included
not only [t he Hospital District] but dozens of g overnme nt al , co m m er cial and other instit utional customers.” This arg ument mischara cter izes Southwestern Bell’s posi tion in STA

. Fr om the first day of litigation, Southwestern Be ll “vig orously dispute[d] ” the exis tence of any cer tifiable class and denied the viability of the claims alleg ed. Nothing in this rec ord ref lects that Southwestern Be ll ever sug g ested the Hospital District—or any oth er putative class member—ha d a viable claim arising from the fee dispute or that the prese nt claims lie o u t s ide the rele ase set forth in the Mirales Settlement. Thus, the Hospital District has produce d no evidenc e of a statement “contr ary to the

asser tion[ s]” AT&T makes in the pre sent ca se. We overrule the issue. 2

Long v . Knox , 291 S.W .2d 292, 295 (Tex. 1956). The Hospital District appea rs to a rg ue 2 that Southwestern Bell’s failure t o raise the possible res judicata effec t of Mirales during the STA litigation constitutes a prior inconsistent statement. Under the Mirales Rule 1 1 Agr ee ment, Southwestern Be ll had promised not to raise that arg ument ag ainst STA and its putative class. Thus, even ass u mi n g a n y in c o n s is te ncy betwee n that omitted statement and the asser tions made here , “[t] he doctrine of judicial estoppel simply does not apply under these circ umsta n ce s . ” Ferguson v. Building Materials Corp. of Am. , 295 S.W .3d 642, 644 (Tex. 2009) (explaining that the doctrine is intended “to preve nt pa rties from play ing fast and loose with the judicial sy stem”); Spartan Tex. Six Capital Partners, Ltd. v. P er r yman , 494 S.W .3d 735, 749 (Tex. App.—Houston [14t h Dist.] 2016, pet. g rante d) (“[C] ourts should deter mine if apply ing judicial estoppel is appropr iate in light of the specific fac ts o f eac h case and the doctrine’ s purpose of ‘protec t[ ing] the integ rity of the 20III CONCLUSION H a v in g c o n c luded that the district court err ed in reve rsing the PUC’s order dism is s in g the Hospital District’s complaint, we reve rse its final judgme nt a nd rende r judgme nt a ffirming the PUC’s dismi ssal order . Tex. R. App. P . 43.2.

__________________________________________ Edwar d Smit h, J ustice Be fore Chief J ustice Rose, Jus tices Ke lly and Smith Reverse d and Rende red Filed: May

3, 2019

judicial proce ss.’” (quoting United States ex rel. Long v. GSDMI dea City, L.L.C

. , 798 F.3d 265, 271 (5th Cir. 2015)) (a lteration in orig inal), aff’d as modified , 546 S.W .3d 110 (Tex. 2018)). 21