Court Opinion

ID: 9777491
Source: CourtListenerOpinion
Date Created: 2023-08-29 20:13:05.668644+00
Date Added: 2024-06-11T07:32:55.051081
License: Public Domain

GONZALEZ, Justice,
joined by SPECTOR, Justice, concurring in part and dissenting in part.
I concur in the Court’s judgment with respect to the plaintiffs’ misrepresentation claims under the Deceptive Trade Practices — Consumer Protection Act (DTPA). However, I cannot join the Court’s opinion because legally sufficient evidence supports the juries’ findings that U.S. Brass engaged in unconscionable conduct. Thus, I would affirm in part and reverse in part the judgments of the court of appeals.
The Legislature has expressed a policy that the DTPA be liberally construed to protect consumers in their dealings with merchants and tradesmen. See Tex.Bus. & Com. Code § 17.44. Consumers are authorized to bring suit not merely for false, misleading, or deceptive acts or practices, see id. § 17.50(a)(1), but also for “any unconscionable ... course of action by any person.” Id. § 17.50(a)(3). An unconscionable course of action includes “tak[ing] advantage of the *655lack of knowledge, ability, experience, or capacity of a person to a grossly unfair degree.” Id. § 17.45(5)(A). To be actionable, the resulting unfairness must be “glaringly noticeable, flagrant, complete and unmitigated.” Kennemore v. Bennett, 755 S.W.2d 89, 92 (Tex.1988). Whether the defendant commits a misrepresentation or engages in unconscionable conduct, its actions must be taken “in connection with” the transaction forming the basis of the plaintiff’s claim. See, e.g., Home Sav. Ass’n v. Guerra, 738 S.W.2d 134, 136 (Tex.1987); Knight v. International Harvester Credit Corp., 627 S.W.2d 382, 388-89 (Tex.1982); Cameron v. Terrell & Garrett, Inc., 618 S.W.2d 535, 541 (Tex.1981).
The “in connection with” requirement properly focuses our view of the evidence on producing cause. A plaintiff must prove the defendant’s acts were the producing cause of his damages, but need not establish the existence of privity between the parties. See Qantel Business Sys., Inc. v. Custom Controls Co., 761 S.W.2d 302, 305 (Tex.1988); Guerra, 733 S.W.2d at 136. The first component of producing-cause analysis is a purely fact-based examination, considering whether, but for the defendant’s conduct, the plaintiffs injuries would not have occurred. See Prudential Ins. Co. v. Jefferson Assocs., Ltd., 896 S.W.2d 156, 161 (Tex.1995): Under the DTPA, a defendant’s acts cannot be the producing cause of a plaintiffs injuries unless the injuries flowed from the defendant’s misconduct in connection with a consumer transaction. In this instance, there can be no dispute that the plaintiffs’ damages flow from the deceptive or unconscionable conduct, satisfying the “but for” component of producing cause.
Producing-cause analysis further includes an inquiry into whether the defendants’ conduct was the “legal cause” of the plaintiffs’ injuries; that is, whether it was such a substantial factor in causing the plaintiffs’ injuries that liability should be imposed. See Prudential, 896 S.W.2d at 161. See generally Union Pump Co. v. Allbritton, 898 S.W.2d 773, 779-84 (Tex.1995) (Cornyn, J., concurring) (describing development and current status of producing-cause analysis). Policy-based considerations and “common-sense notions of responsibility” should guide the determination of whether the causal connection between the defendant’s acts and the plaintiffs’ injuries merits the imposition of DTPA liability. See William Powers, Jr, Texas Products Liability Law § 6.022, at 6-4, 6-20 (2d ed. 1992).
The analysis of legal cause also must be confined to the facts of the particular ease, but courts should consider factors deemed significant in other DTPA cases. A nonexclusive list can be distilled from this Court’s prior decisions. Such a list would include the following:
(1) the extent to which the defendant ben-efitted from the overall transaction, see Flenniken v. Longview Bank & Trust Co., 661 S.W.2d 705, 707 (Tex.1983); Knight, 627 S.W.2d at 389;
(2) the defendant’s control over a product’s manufacture, repair, or installation, see Guerra, 733 S.W.2d at 136-37; International Armament Corp. v. King, 686 S.W.2d 595, 599 (Tex.1985); Hurst v. Sears, Roebuck & Co., 647 S.W.2d 249, 251-52 (Tex.1983);
(3) the defendant’s knowledge of and ability to influence the terms of a sale of a product or service to consumers, see Knight, 627 S.W.2d at 389; Cameron, 618 S.W.2d at 537-39; Ozuna v. Delaney Realty, Inc., 600 S.W.2d 780, 781-82 (Tex.1980);
(4) the defendant’s control over the marketing of goods or services, including its intent that its representations be passed on to consumers, and whether they were passed on to them, see Kennemore, 755 S.W.2d at 92; Brown v. Galleria Area Ford, Inc., 752 S.W.2d 114, 115-16 (Tex.1988); Kennedy v. Sale, 689 S.W.2d 890, 891-93 (Tex.1985); and
(5) the extent to which intermediaries or the consumer can reasonably make an independent assessment of the characteristics of goods or services, and the extent to which they did, see Doe v. Boys Clubs of Greater Dallas, Inc., 907 S.W.2d 472, 481-82 (Tex.1995); Prudential, 896 S.W.2d at 161; Dubow v. *656Dragon, 746 S.W.2d 857, 860-61 (Tex.App.-Dallas 1988, no writ).
With these factors in mind, I consider the evidence under the appropriate standard of review, examining it in the light most favorable to the jury verdicts and disregarding all contrary evidence. See Davis v. City of San Antonio, 752 S.W.2d 518, 522 (Tex.1988); W. Wendell Hall, Revisiting Standards of Review in Civil Appeals, 24 St. Mary’s L.J. 1045, 1133 (1993). My review of the record reveals significant distinctions between U.S. Brass’s conduct and that of Celanese and Shell, which merely supplied some of the materials U.S. Brass used to manufacture the plumbing system. The record shows that U.S. Brass did the following:
(1) designed and exclusively manufactured the plumbing system at issue;
(2) selected the raw materials used in fabricating the system, including polybu-tylene resin for the pipe and Celcon compound for the fittings;
(3) ignored Celanese’s recommendations that it test fittings made from Celcon in the severest anticipated end-use conditions;
(4) designed and produced the crimping tool used to install the system and the accompanying crimp rings;
(5) made representations to building code officials about the system’s suitability despite its failure to test the system’s fitness and durability for use under ordinary conditions present in LaPorte homes;
(6) conducted an aggressive sales campaign aimed at the new home market and targeted individual builders for sales of the system;
(7) represented to builders that the poly-butylene plumbing system was durable and would last twenty-five years;
(8) depicted the system as easy to install, requiring fewer joints, and as a quality product with characteristics superior to copper, galvanized steel, and PVC plumbing systems;
(9) met with home builders numerous times, touting its system;
(10) provided a catalog on the plumbing system to home builders, which represented that the pipe would not corrode, freeze, or allow mineral build-up and that the fittings would not corrode;
(11) prepared the installation instructions for the system and trained the builders’ plumbers and subcontractors on how to install it;
(12) suppressed a report from one of its product development specialists indicating that “enormous problems still needed to be overcome” regarding the system;
(13) ignored the specialist’s recommendation that “a serious research and development program” was needed to fix continuing problems with leaks and excessive failure rates in the pipes and fittings, see 864 S.W.2d 606, 624; and
(14) rather than acting on these suggestions to mitigate the system’s failure rate, told the specialist to destroy the most damming portions of his report, id.
Furthermore, but for U.S. Brass’s aggressive promotion of its plumbing system, building officials would not have approved its use in subdivision homes and new home builders would not have installed it.
Under the factors I have listed, particularly whether the plaintiffs could reasonably evaluate the product, U.S. Brass’s conduct clearly meets the “substantial factor” element of producing cause. The plaintiffs believed the plumbing system installed in their homes was a quality product that at least met building code standards for performance and longevity. They could not have known of, nor did they have the ability, experience, or capacity to detect, the micro-fine cracks in the pipes that would eventually split and burst or the cumulative degradation of the insert fittings that ultimately gave way because of chlorine exposure and stress. See Kennemore, 755 S.W.2d at 92 (ruling that defendant acted unconscionably in flagrantly taking advantage of consumers’ “lack of knowledge” and inability to correct specific problems). U.S. Brass’s conduct caused the *657installation of systems that failed miserably, resulting in property damage, diminution in the value of homes, and personal distress to the plaintiff-homeowners. I conclude that more than a scintilla of evidence supports the juries’ findings that U.S. Brass took advantage of the new homeowners’ lack of knowledge and capacity to evaluate the reliability of their plumbing systems and did so to a grossly unfair degree. See Brown, 752 S.W.2d at 116 (holding that defendant “took advantage” of plaintiffs “to a grossly unfair degree” by exploiting their lack of knowledge). In light of the policies animating the DTPA and common-sense notions of responsibility, the jury verdicts imposing liability upon U.S. Brass for unconscionable conduct toward new home buyers should stand.
On the other hand, some purchasers acquired their homes from prior owners by private sale or through foreclosure. U.S. Brass represented the plumbing system’s characteristics to the home builders and to building code inspectors, anticipating that it would expand the new-home market for its plumbing system by doing so. However, U.S. Brass’s role in connection with the acquisition of homes by subsequent purchasers was far less pronounced. Assuming that U.S. Brass’s unconscionable conduct factually caused the presence of the defective plumbing systems in used homes, this connection is too attenuated to merit the imposition of DTPA liability. See Boys Clubs, 907 S.W.2d at 481-82.
In summary, more than a scintilla of evidence supports the juries’ findings that U.S. Brass acted unconscionably and that its acts were a producing cause of the damages to new homeowners. Therefore, under the facts of these three cases, I would affirm the judgments of the court of appeals to the extent they approved the imposition of DTPA liability upon U.S. Brass for its unconscionable conduct toward new home buyers. See TexBus. & Com.Code §§ 17.45(5)(A), 17.50(a)(3). However, I would reverse the lower court’s judgments, as specified by the Court, and render judgment that the plaintiffs take nothing against Celanese, Shell, and U.S. Brass for any alleged DTPA misrepresentations.