Case Name: The STATE of Texas, Petitioner, v. MALONE SERVICE COMPANY, Arthur Lee Malone and Larry Malone, Respondents
Court: Supreme Court of Texas
Jurisdiction: Texas
Decision Date: 1992-04-29
Citations: 829 S.W.2d 763
Docket Number: No. D-0863
Parties: The STATE of Texas, Petitioner, v. MALONE SERVICE COMPANY, Arthur Lee Malone and Larry Malone, Respondents.
Judges: 
Reporter: South Western Reporter Second Series
Volume: 829
Pages: 763–770

Head Matter:
The STATE of Texas, Petitioner, v. MALONE SERVICE COMPANY, Arthur Lee Malone and Larry Malone, Respondents.
No. D-0863.
Supreme Court of Texas.
April 29, 1992.
Rehearing Overruled June 17, 1992.
Brian E. Berwick, Nancy Olinger, Austin, for petitioner.
Jacalyn D. Scott, Thomas E. Bilek, Houston, Dan Morales, Austin, for respondents.

Opinion:
OPINION
MAUZY, Justice.
This civil environmental enforcement action presents evidentiary issues relating to the defense of discriminatory enforcement. The trial court excluded evidence of penalties listed within an enforcement log of the Texas Water Commission. The court of appeals reversed and remanded, holding that the evidence should have been admitted. 804 S.W.2d 174. We reverse the judgment of the court of appeals.
Malone Service Company operates a hazardous waste disposal plant in Galveston County. Before 1977, Malone legally used a large unlined earthen pit for the receipt of waste. In August, 1977, however, the Texas Department of Water Resources issued an order amending Malone's waste disposal permit to provide for the installation of a concrete separator system to divide waste into aqueous, organic, and solid phases. The order also stated:
The company shall discontinue use of the earthen pit upon completion of the separator and close-out the earthen pit as described in the application within 18 months after issuance of this Amendment.
Despite continued enforcement efforts by the Department, Malone failed to cease its use of the earthen pit, even after the eighteen-month deadline had been extended. Finally, in early 1983, Malone entered into a Compliance Agreement providing that, so long as Malone closed the earthen pit within one year, statutory enforcement proceedings would be withheld.
The State of Texas, acting upon request of the Texas Water Commission, brought this suit against Malone and others (collectively "Malone") in 1986. See Tex.Health & Safety Code § 361.224(b). The State alleged that, despite the 1977 order and the 1983 Compliance Agreement, Malone continued to discharge hazardous waste into the earthen pit in violation of the Texas Solid Waste Disposal Act, Tex.Health & Safety Code § 361.001, and the Texas Injection Well Act, Texas Water Code § 27.-001 et seq. In its defense, Malone asserted a claim of discriminatory enforcement, contending that the State's enforcement action was motivated solely to benefit one of Malone's competitors, the Gulf Coast Waste Disposal Authority (Gulf Coast).
At trial, Malone sought to support its claim of discriminatory enforcement with an enforcement log generated by the Commission's computers. The log, dated October 26,1988, lists the names of hundreds of companies against which the Commission had some type of enforcement activity under the Solid Waste Disposal Act. Six of those companies, Malone contends, were customers and investors of Gulf Coast, and had been classified by the Commission as large polluters. Malone claims that the log shows the Commission had taken enforcement action against only four of the six companies, and had assessed no penalties in any of those cases.
The State objected and requested that the log be admitted with certain columns excised; namely, the columns styled "Penalty Assessed," "Penalty Collected," and "Scheduled Compliance." The trial court sustained the objection and admitted the log with the disputed columns removed.
The trial court did not, however, bar all evidence relating to enforcement proceedings against Malone's competitors. The court permitted Malone's counsel to go through the admitted portions of the enforcement log and other documents in order to elicit testimony from two Water Commission employees. This testimony revealed that all six of the companies in question had been subject to enforcement in some manner short of suit. The two employees also testified that the State had shut down none of these six companies, and that no officers or directors of the six companies had been individually fined for violations of State environmental statutes.
On the basis of the evidence presented, the jury found that the Commission had not intentionally discriminated in the enforcement of its regulations against Malone. Passing on the Commission's allegations, the jury found that Malone had continued to use the earthen pit on 418 occasions after September 19, 1979, and that Malone had contaminated ground water by discharging or causing seepage of solid waste from the earthen pit on a total of 8,495 occasions. For each of the instances in which Malone had used the pit, the jury chose to assess the maximum civil penalty of $5,000. See Tex.Water Code § 27.101. The trial court rendered judgment on the jury verdict against Malone in the amount of $2,403,900; against Arthur Lee Malone, the company's president, in the amount of $627,000; and against Larry Malone, the company's plant manager, in the amount of $22,000.
On appeal, Malone argued, among other things, that the trial court had erred in excluding the evidence of penalties assessed against Malone's competitors. The court of appeals agreed, reasoning that the excised columns should have been admitted in support of Malone's defense of discriminatory enforcement. 804 S.W.2d at 174.
The defense of discriminatory enforcement is based on the constitutional guarantee of equal protection under the law. U.S. Const, amend. XIV, § 2; Tex. Const, art. I, § 3; see generally Yick Wo v. Hopkins, 118 U.S. 356, 6 S.Ct. 1064, 30 L.Ed. 220 (1886). Though the defense originated in the context of criminal prosecutions, the governing principles also apply to civil proceedings involving state agencies. See Railroad Commission v. Shell Oil Co., 139 Tex. 66, 71-76, 161 S.W.2d 1022, 1025-28 (1942); Colorado River W. Ry. v. Texas & New Orleans R.R. Co., 283 S.W.2d 768, 776-77 (Tex.Civ.App.—Austin 1955, writ ref'd n.r.e.).
To establish a claim of discriminatory enforcement, a defendant must first show that he or she has been singled out for prosecution while others similarly situated and committing the same acts have not. See United States v. Rice, 659 F.2d 524, 526 (5th Cir.1981); Wolf v. State, 661 S.W.2d 765, 766 (Tex.App.—Fort Worth 1983, writ ref'd n.r.e.). It is not sufficient, however, to show that the law has been enforced against some and not others. The defendant must also show that the government has purposefully discriminated on the basis of such impermissible considerations as race, religion, or the desire to prevent the exercise of constitutional rights. See Rice, 659 F.2d at 526; Wolf, 661 S.W.2d at 766; see also Super-X Drugs of Texas, Inc. v. State, 505 S.W.2d 333, 336 (Tex.Civ.App.—Houston [14th Dist.] 1974, no writ).
In deciding whether to admit evidence in support of a discriminatory enforcement claim, a trial court must apply the rules of evidence in light of the above requirements. Evidence will generally be relevant to the defense of discriminatory enforcement if it tends to show either that the government has singled the defendant out for prosecution or that the government has acted on the basis of impermissible considerations. See Tex.R.Civ.Evid. 401. Even if the evidence is relevant, however, the trial court may exclude it if its probative value is substantially outweighed by the danger of unfair prejudice, confusion of the issues, or misleading the jury, or by considerations of undue delay or needless presentation of cumulative evidence. Tex. R.Civ.Evid. 403.
In the present case, Malone sought to establish that the State had discriminated by taking strong enforcement action against Malone while taking little or no action against companies associated with the Gulf Coast Waste Disposal Authority. This assertion, if true, would tend to support the allegation that Malone has been singled out for prosecution while others similarly situated and committing the same acts have not. It would not, however, constitute a showing that the government has purposefully discriminated on the basis of impermissible considerations.
The complexity of regulatory enforcement requires that a state agency retain broad discretion in carrying out its statutory functions. See Heckler v. Chaney, 470 U.S. 821, 831, 105 S.Ct. 1649, 1655, 84 L.Ed.2d 714 (1985). Thus, a discriminatory purpose is never presumed; rather, the party asserting the defense of discriminatory enforcement must show a clear intentional discrimination in enforcement of the statute. See S.S. Kresge Co. v. State, 546 S.W.2d 928, 930 (Tex.Civ.App.—Dallas 1977, writ ref d.n.r.e.); see also Enntex Oil & Gas Co. v. State, 560 S.W.2d 494, 497-98 (Tex.App.—Texarkana 1977, no writ); Super-X Drugs, 505 S.W.2d at 336. Even when enforcement has been sought for selfish reasons by a private entity, the state's actions are presumptively non-discriminatory; the motives of the private entity are not imputed to the state. See Retail Merchants Ass'n of Houston, Inc. v. Handy Dan Hardware, Inc., 696 S.W.2d 44, 53 (Tex.App.—Houston [1st Dist.] 1985, no writ); S.S. Kresge Co., 546 S.W.2d at 930.
Malone offered no evidence suggesting that benefits to Gulf Coast would flow directly to the State. Nor did Malone offer any evidence suggesting that the State's action against Malone was based on race, religion, or any other impermissible considerations. Thus, as a matter of law, the evidence offered by Malone failed to establish the defense of discriminatory enforcement.
We conclude that the trial court did not abuse its discretion in excluding the penalty amounts in the enforcement log. We reverse the judgment of the court of appeals and remand this cause to that court for consideration of points not yet reached.
Concurring opinion by GONZALEZ, J.
. See Texas Water Code § 26.123; Tex.Rev.Civ. Stat.Ann. art. 4477-7 (Vernon Supp.1986), repealed by Acts 1989, 71st Leg., ch. 678, § 13(1), eff. Sept. 1, 1989; now see Tex.Health & Safety Code § 361.001.
. The Texas Water Commission is the successor agency to the Texas Department of Water Resources. See Texas Water Code Ann. § 5.001, amended by Acts 1985, 69th Leg., ch. 795, § 1.001, eff. Sept. 1, 1985.
. The Gulf Coast Waste Disposal Authority is a political subdivision created by the Texas Legislature in 1969 under Téx. Const, art. 16, § 59. See Gulf Coast Waste Disposal Authority Act, ch. 409, 1969 Tex.Gen.Laws 1336. Gulf Coast has the power to develop and effectuate a regional water quality management program in Chambers, Galveston, and Harris counties.
. In the criminal context, the defense is generally known as selective prosecution. See, e.g., Wayte v. U.S., 470 U.S. 598, 608, 105 S.Ct. 1524, 84 L.Ed.2d 547 (1985); Gawlik v. State, 608 S.W.2d 671, 673 (Tex.Crim.App.1980). In both the civil and the criminal contexts, though, the same equal protection principles apply. See generally Kenneth C. Davis, Administrative Law Treatise § 9:7 (2nd ed. 1979 & 1989 supp.).
. Neither Malone nor the State argues that the trial court erred in submitting the discriminatory enforcement issue to the jury; thus, we do not decide that question. We note, however, that at least some federal courts have assigned the issue to the judge, see United States v. Berrigan, 482 F.2d 171, 174-76 (3rd Cir.1973), while at least one Texas court has left the matter to the jury, see Wolf v. State, 661 S.W.2d 765, 766 (Tex.App.—Fort Worth 1983, writ refd n.r.e.).
. "[A]n agency decision not to enforce often involves a complicated balancing of a number of factors which are peculiarly within its expertise. Thus, the agency must not only assess whether a violation has occurred, but whether agency resources are best spent on this violation or another, whether the agency is likely to succeed if it acts, whether the particular enforcement action requested best fits the agency's overall policies, and indeed, whether the agency has enough resources to undertake the action at all. An agency generally cannot act against each technical violation of the statute it is charged with enforcing."
. Under state law, all funds held by Gulf Coast must be placed either in depository banks designated by Gulf Coast's board of directors or in a trustee bank named in a trust indenture. Gulf Coast Waste Disposal Authority Act, ch. 409, § 4.08, 1969 Tex.Gen.Laws 1336, 1350. No funds received by Gulf Coast flow directly to the State.