Court Opinion

ID: 4065263
Source: CourtListenerOpinion
Date Created: 2016-09-29 21:55:25.019573+00
Date Added: 2024-06-11T08:44:34.838693
License: Public Domain

ACCEPTED
                                                                                           03-15-00118-CV
                                                                                                   5176524
                                                                                THIRD COURT OF APPEALS
                                                                                           AUSTIN, TEXAS
                                                                                       5/6/2015 2:17:08 PM
                                                                                         JEFFREY D. KYLE
                                                                                                    CLERK

                               NO. 03-1S-00118-CV
                                                                         FILED IN
                               In the Court of Appeals            3rd COURT OF APPEALS
                                                                      AUSTIN, TEXAS
                       for the Third Judicial District of Texas   5/6/2015 2:17:08 PM
                                       at Austin                    JEFFREY D. KYLE
                                                                          Clerk

             TEXAS QUARTER HORSE ASSOCIATION,                      ET AL
                   Appellants/Intervening Defendants,

                                          v.

         AMERICAN       LEGION DEPARTMENT               OF TEXAS, ET AL,
                             Appellees/Plaintiffs.

                   Appeal from the 53rd Judicial District Court
                              Travis County, Texas
                   Trial Court Cause No. D-I-GN-14-003700

       APPELLEES/PLAINTIFFS'            MOTION TO DISMISS APPEAL

      TO THE HONORABLE COURT OF APPEALS:

      COME NOW AMERICAN LEGION POST 133 et a!., Plaintiffs/Appellees,

and KICKAPOO        TRADITIONAL         TRIBE       OF TEXAS        and THOMPSON

ALLSTATE      BINGO      SUPPLY,     INC.      et al., Plaintiff-Intervenors/Appellees

(collectively "Plaintiffs"), and file this their Motion to Dismiss Appeal, and would

show as follows:
                                      I.      ,Summary

       This case is an appeal of a summary judgment               holding that the recent

administrative    rules of the Texas Racing          Commission      ("TRC")     permitting

gambling machine wagering on videos of previously run horse and dog races

violate the Texas Racing Act, are outside the TRC's authority, and are void and of

no effect.    Significantly,    the TRC, its executive director, and its individual

Commissioners who were defendants have not appealed the summary judgment.

Instead, they allowed it to become final as to them, in essence accepting the

judgment.    The only appellants before this Court are private horse racing industry

organizations that had intervened as defendants ("Intervening Defendants").                 CR

119,126,130,136,143,147,236,245.1

       The Court should dismiss this appeal for lack of subject matter jurisdiction

on the following grounds:

       (1)    This appeal is now moot because the TRC's decision not to appeal

and thus to accept the trial court judgment finally resolves the controversy by

providing the relief sought by the Plaintiffs with regard to the rules' validity;

1 The Plaintiffs filed a notice of cross-appeal to challenge the trial court's sustaining   of
Intervening Defendants' objections to certain of Plaintiffs' summary judgment evidence.

                                              2
      (2)    This appeal is now moot because the new rules no longer exist and no

controversy remains for this Court as a result of the TRC having conceded the

invalidity of the new rules by not appealing;

      (3)    This appeal is now moot because the Court may not reenact or revive

the new rules and therefore cannot grant effective relief;

      (4)    Any ruling from this Court would provide only an advisory opinion

and violate separation of powers principles; and

      (5)    The TRC is a necessary         party to this appeal under the Texas

Administrative Procedure Act but, by not appealing, cannot be made a party.

                              II. Factual Background

      The Texas Racing Act, Tex. Rev. Civ. Stat. Ann. art. 17ge, has permitted

pari-mutuel wagering on live horse and dog races since its enactment in 1986 and

on simulcast horse and dog races since 1991. Acts 1991, 72nd Leg., ch. 386. The

TRC gets its authority from the Texas Racing Act. Tex. Rev. Civ. Stat. Ann. art.

17ge, arts. 2 and 3.

      On August 29, 2014, the TRC adopted administrative regulations purporting

to authorize wagering on videos of past horse and dog races, which the TRC

referred to as "historical"   "racing."   See 39 Tex. Reg. 7573 (Sept. 19, 2014);

                                           3
Transcript of 8/29/14 Tex. Racing Comm 'n Mtg.2                 The TRC recogmzes that

"historical racing" terminals do not constitute either live racing approved in 1986

or simulcast racing approved in 1991. "[H]istorical racing is distinct from live or

simulcast racing." 39 Tex.Reg. at 4882 (16 TAC §321.701).                 No legislation has

ever approved "historical" or other gambling device race wagering in Texas.

        Twenty-six nonprofit organizations that conduct charitable bingo in Texas,

several businesses that provide services to those charities, a charitable advocacy

group, and a federally-recognized        Indian tribe that operates a gaming facility in

Texas filed suit in Travis County, Texas against the TRC, its executive director,

and some of its Commissioners challenging the new regulations.                CR 4, 62, 155.

Plaintiffs sought a declaratory judgment under Tex. Gov't Code Ann. §2001.038(a)

and Tex. Civ. Prac. & Rem. Code Ann. §§37.001 et. seq. that the rules violated the

Texas Racing Act, were outside the TRC's authority and were ultra vires, and were

void.    Id.    Plaintiffs   also sought to invalidate        the rules under the Texas

Constitution, the Texas Penal Code, and the Administrative Procedure Act, and

requested injunctive relief from the rules' enforcement.          Id. A number of private

2 Available at www.txrc.texas.gov/agency/meetings/transcripts/t20140829.pdf.      The       new
regulations included amendments to existing regulations at 16 Texas Administrative Code
("TAC") sections 301.1, 303.31, 303.42, 309.8, 309.297, 309.299, 309.361, 321.5, 321.12,
321.13, 321.23, 321.25, and 321.27, and also added new provisions authorizing so-called
"historical" racing at 16 TAC sections 321.701-321.719.       See 16 TEX. ADMIN.CODE §§321.701
et seq., with conforming amendments to other rules. The new rules were proposed at 39 Tex.
Reg. 4873 et seq. (June 27, 2014) and adopted at 39 Tex. Reg. 7573 et seq. (Sept. 19,2014).

                                               4
organizations in the horse and dog racing industry intervened to defend the new

rules.    CR 119, 126, 130, 136, 143, 147, 236, 245.             None of the governmental

Defendants or the Intervening Defendants asserted any affirmative claims for

relief. Id.

         Plaintiffs   filed a motion for partial summary judgment               on their two

declaratory judgment claims and their ultra vires claim. CR 254. The TRC and its

officials filed a cross-motion for summary judgment on all claims, CR 341, as did

the Intervening Defendants.        CR 384, Supp. CR 3. The trial court granted the

Plaintiffs'   motion for partial summary judgment             in full and denied both the

governmental Defendants'         motion for summary judgment             and the Intervening

Defendants'      separate summary judgment          motion on the issue of the TRC's

statutory authority to adopt the new rules.' CR 661. The trial court stated that the

TRC's "historical racing rules" exceed the TRC's                authority under the Texas

Racing Act, Tex. Rev. Civ. Stat. Ann. art. 17ge, and are invalid.                Id.   Plaintiffs

nonsuited their remaining claims so the summary judgment could become final as

to their declaratory judgment and ultra vires claims. CR 656.

3 The trial court did not address the Defendants' and Intervening Defendants' other grounds for
summary judgment, which were that the TRC allegedly complied with the Administrative
Procedure Act when issuing the new rules and that the rules purportedly did not violate the Texas
Constitution or the Texas Penal Code. CR 663-64. The Plaintiffs nonsuited their claims under
the Texas Constitution, Penal Code, APA non-compliance (as opposed to claim under
§2001.038(a)), and for injunctive relief, mooting the Defendants' and Intervening Defendants'
other grounds for summary judgment. CR 656.

                                                5
          Neither the TRC nor its officials       appealed the judgment.      Only the

Intervening Defendants have appealed the judgment." CR 740.

                                     III. Argument

A. The Court Lacks Subject Matter Jurisdiction and Dismissal is Required
Because the Intervening Defendants' Appeal is Moot

          Texas courts lack subject matter jurisdiction over cases that are moot. Nat'l

Collegiate Athletic Ass 'n v. Jones, 1 S.W.3d 83, 86 (Tex. 1999) (cited in Smith v.

Abbott, 311 S.W.3d 62, 77 (Tex. App.-Austin          2010, pet. denied)).   This lack of

jurisdiction "is rooted in separation-of-powers    concepts and the prohibition against

courts rendering advisory opinions."      Smith, 311 S.W.3d at 77. A case becomes

moot when either: (1) there is no case or controversy; or (2) judgment is sought

that cannot have any practical legal effect. See Texas Health Care Info. Council v.

Seton Health Plan, 94 S.W.3d 841, 846-47 (Tex. App.-Austin           2002, pet. denied).

          The TRC's decision not to appeal the trial court's judgment has rendered

this case moot. First, no controversy exists because the TRC did not appeal and

there is no case or controversy between the remaining parties. Second, this case is

not redressable by the Court because the rules the TRC has chosen to abandon no

4
    See n. 1, supra.

                                             6
longer exist.   Any ruling in this case would render an impermissible advisory

opinion.

      1. Mootness standard

      "A case becomes moot when: (1) it appears that one seeks to obtain a

judgment on some controversy, when in reality none exists; or (2) when one seeks

a judgment on some matter which, when rendered for any reason, cannot have any

practical legal effect on a then-existing controversy."     Texas Health Care Info.

Council, 94 S.W.3d at 846-47.

      Under the mootness doctrine, a controversy must involve a dispute of

something more than a hypothetical or abstract character. Securtec, Inc. v. County

of Gregg, 106 S.W.3d 803, 809 (Tex. App.- Texarkana 2003, pet. denied) (citing

Scurlock Permian Corp. v. Brazos County, 869 S.W.2d 478, 487 (Tex. App.-

Houston [1st Dist.] 1993, writ denied)).       The doctrine also requires that courts

avoid rendering advisory opinions by only deciding cases that present a "live"

controversy at the time of the decision. Camarena v. Texas Employment Comm 'n,

754 S.W.2d 149,151 (Tex. 1988).

      "A case becomes moot if a controversy ceases to exist between the parties at

any stage of the legal proceedings, including the appeal." In re Kellogg Brown &

Root, Inc., 166 S.W.3d 732, 737 (Tex. 2005);           see also Allstate Ins. Co. v.

                                           7
Hallman, 159 S.W.3d 640,642 (Tex. 2005). Thus, "[w]hen there has ceased to be

a controversy between the litigating parties ... the decision of an appellate court

would be a mere academic exercise and the court may not decide the appeal."

Olson v. Comm 'n for Lawyer Discipline, 901 S.W.2d 520, 522 (Tex. App.-EI

Paso 1995, no writ) (internal citations omitted). Appellate courts, therefore, "have

an obligation to take into account intervening events that may render a lawsuit

moot." Heckman v. Williamson Cnty., 369 S.W.3d 137, 166-67 (Tex. 2012).

      2. Because the TRC did not appeal, no case or controversy remains for
this Court to decide, rendering the appeal moot.

       The TRC's decision not to appeal mooted the case because: (a) no case or

controversy      exists between the remaining parties; and (b) the subject of the

litigation-the    new rules-legally   no longer exists.

       a. The appeal is moot because there is no case or controversy between
          the remaining parties.

       The Court lacks subject matter jurisdiction over this appeal because no case

or controversy exists between the remaining parties.      When the state becomes a

party to a suit it is subject to the same rules that govern other parties, and a

judgment for or against it must be given the same effect as would be given if it

were an individual litigant.      See, e.g., Wortham v. Walker, 133 Tex. 255, 128
S.W.2d 1138, 1145 (1939); Railroad Commission v. Arkansas Fuel Oil Co., 148

                                            8
S.W.2d 895, 898 (Tex. Civ. App.-Austin         1941, writ ref'd); see also Royal Indep.

Sch. Dist. v. Ragsdale, 273 S.W.3d 759, 766 n.7 (Tex. App.-Houston          [14th Dist.]

2008, no pet.) (school district, an arm of state, may not attack order that it failed to

timely appeal); In re State Board for Educator Certification, 452 S.W.3d 802, 809

(Tex. 2014) (orig. proceeding) (state board not entitled in this instance to supersede

judgment under TRAP 25.1(h)).

          By allowing the judgment to become final by not appealing, the TRC has

legally abandoned its new rules and accepted the trial court's ruling that those rules

were enacted without authority, were ultra vires acts, are void, and are of no legal

effect.     See, e.g., Diamond v. Charles, 476 U.S. 54, 63-64 (1986) ("By not

appealing the judgment below, the State indicated its acceptance of that decision,

and its lack of interest in defending its own statute ...     its failure to invoke our

jurisdiction   leaves the Court without a 'case'     or 'controversy'   .... " (footnote

omitted)). The trial court's rulings are now final and non-appealable as to the TRC

and its Commissioners.     See Eastin v. Dial, 288 S.W.3d 491, 499 (Tex. App.-San

Antonio 2009, pet. denied) ("Generally, when one party appeals a judgment, any

relief afforded that party applies only to him and not to any nonappealing party.").

          As a result of the government Defendants' acceptance of the judgment and

abandonment      of the new rules, there is no longer a "rule or its threatened

                                           9
application [that] interferes with or impairs, or threatens to interfere with or impair,

a legal right or privilege of the plaintiff," for purposes of a case or controversy

under the Texas Administrative Procedure Act's declaratory judgment provision.

Tex. Govt. Code Ann. §2001.038(a).5 Concomitantly, there is no longer a need for

a court to "declare [the] rights, status, and other legal relations" between Plaintiffs

and the government Defendants, for purposes of a live controversy under the Texas

Declaratory    Judgment Act.        Tex. Civ. Prac. & Rem. Code Ann. §37.003(a).6

Moreover, the summary judgment based on ultra vires claims was not appealed by

the only parties who acted ultra vires - i.e., the individual TRC officials. There is

no longer a case or controversy between Plaintiffs and the only parties against

whom Plaintiffs had asserted any claims-the           TRC and its officials.

5 Note also that the United States Supreme Court has stated that, based on "concerns for state
autonomy," a private defendant appealing in the absence of the state party may not "compel a
State to create and retain" a certain "legal framework." Diamond v. Charles, 476 U.S. 54, 65
(1986) (dismissing appeal by private intervening defendant when state entity did not appeal); see
also, e.g., Associated Builders & Contractors v. Perry, 16 F.3d 688, 691-93 (6th Cir. 1994)
(finding an intervening defendant could not appeal in the absence of the state because it could
not "compel the State to enforce a law which it has chosen to abandon").

6 See also Hollingsworth v. Perry, 133 S. Ct. 2652, 2662 (2013) (refusing to allow intervening
defendants to appeal in the absence of the state because "the District Court had not ordered [the
intervenors] to do or refrain from doing anything")

                                                10
       There is no case or controversy between the only parties to this appeal-the

Plaintiffs and the Intervening Defendants."         Plaintiffs and Intervening Defendants

asserted no claims against each other, nor could they have done so.

       b. The appeal is moot because the subject of the litigation no longer
          exists.

       The Court also lacks subject matter jurisdiction            because the new rules

themselves    ceased to exist when the judgment            became final as to the TRC,

eliminating the case or controversy.       When a judgment invalidating rules becomes

final, the new rules are void and the last valid rules are restored.          See All Saints

Health Sys. v. Texas Workers' Camp. Comm'n, 125 S.W.3d 96, 103 (Tex. App.-

Austin 2003, pet. denied) ("[T]he appropriate remedy following the invalidation of

an administrative rule under the APA is to return to the last validly adopted legal

standard existing at the time of the rule's promulgation.").              Agency action to

eliminate one of its rules by not appealing the rule's judicial invalidation creates

the same mootness as if the agency had repealed or amended the rule during the

lawsuit.   Cf Heckman, 369 S.W.3d at 167 (challenge to statute or written policy

may become moot if statute or policy is repealed or fundamentally altered); Texas

7 Plaintiffs did file a notice of cross-appeal in the district court on the sole issue of the
Intervening Defendants' objections (Supp. CR 107) to certain evidence in Plaintiffs' summary
judgment response. None of the government Defendants asserted any objections to Plaintiffs'
evidence. Consequently, none of the government Defendants are cross-appellees on Plaintiffs'
cross-appeal. In any event, if the Intervening Defendants' main appeal is dismissed for lack of
subject matter jurisdiction, Plaintiffs' cross-appeal should also be dismissed as being moot.

                                               11
Dept. of Health v. Long, 659 S.W.2d 158, 160-61 (Tex. App.-Austin,             1983, pet.

denied) (appeal moot when procedural            requirement   that served as basis for

temporary injunction was subsequently eliminated by amendment to regulations);

In re Gruebel,      153 S.W.3d 686, 689 (Tex. App.-Tyler,           2005, no pet.)

(amendment of zoning ordinance pending appeal rendered appeal moot); Texas

Education Agency v. Maxwell, 937 S.W.2d 621, 622 (Tex. App.-Eastland               1996,

writ denied) (case moot after trial court invalidation and State repeal); Baptist

Memorial Hosp. Sys. v. Texas Health Facilities Comm 'n, 697 S.W.2d 531, (Tex.

App.-Austin     1985, no writ) (case moot because statutory provisions expired and

agency abolished).      In either scenario, the rule, along with the controversy

concerning it, ceases to exist. Gambling on video images of past races is no longer

part of the TRC's regulations.

      3. The appeal is moot because there is no effective relief the Court may
grant the Appellants.

      A case "becomes moot where the court cannot possibly grant effective

relief." State v. Gibson Prods. Co., Inc., 699 S.W.2d 640, 641 (Tex. App.-Waco

1985, no writ); Fiske v. City of Dallas, 220 S.W.3d 547, 550 (Tex. App.-

Texarkana 2007, no pet.) (declaratory judgment proper only if it will have tangible

effect on litigant's right, status, or legal relations). Courts may not grant relief that

                                           12
would involve an exercise of rule-making authority.                  Cf Buddy Gregg Motor

Homes, Inc. v. Motor Vehicle Bd. of Tex. Dept. of Transp., 179 S.W.3d 589, 603

(Tex. App.-Austin        2005, pet. denied) ("A court 'cannot modify an agency order

without usurping the agency's authority and thereby violating the separation of

powers doctrine. '" (quoting City of Stephenville v. Tex. Parks & Wildlife Dep t,

940 S.W.2d 667, 678 (Tex. App.-Austin                 1996, writ. denied))).       As the Texas

Supreme Court stated in Brown v. Humble Oil & Refining Company:

       If a rule of the commission is found to be illegal or invalid by a court
       of competent jurisdiction, such court may so adjudge. The court
       cannot substitute a new rule for the one adjudged invalid. That power
       rests exclusively with the Railroad Commission.

126 Tex. 296,316,87         S.W.2d 1069, 1070 (1935); see also Texas Dep't of Transp.

v. T Brown Constructors, Inc., 947 S.W.2d 655, 659 (Tex. App.-Austin                         1997,

pet. denied).     Therefore, when relief depends upon an exercise of rulemaking

authority, there is no effective relief that a court can provide.'

       There is no effective relief this Court may grant the Intervening Defendants

with respect to the legally invalidated, abandoned, and now non-existent new rules.

No ruling from this Court could have any practical legal effect because this Court

8 See, e.g., Sea Shore Corp. v. Sullivan, 158 F.3d 51, 58 (1st Cir. 1998) (dismissing appeal by
intervenors in the absence of the state because "in the present case redress ... depends not only
upon a reversal of the district court's decision, but also upon a state agency's decision to enforce
a law after declining to appeal its invalidation").

                                                 13
lacks the subject matter jurisdiction to substitute a new rule for a rule that has been

invalidated in a final judgment and abandoned by the TRC. See, e.g., Brown, 87
S.W.2d at 1070.

       Additionally, this Court cannot add to the trial court judgment of invalidity

or supersede its finality and binding effect as to the TRC. The prior rules, now

restored to legal status by the TRC's decision not to appeal, are the only legally

effective rules, and no dispute as to them is before the Court in this appeal." Only

the TRC can promulgate new rules (to the extent permitted by the Texas Racing

Act). Because any such new rules are hypothetical, do not exist and have not been

evaluated by a district court, they cannot be at issue in the Intervening Defendants'

appeal and are not an issue on which the TRC has sought a ruling from this Court.

      4. A ruling in this case would render an advisory opinion and violate
Texas' separation of powers principles.

       The TRC's decision not to challenge the invalidation of its rules creates an

additional    constitutional   hurdle to Appellants'    appeal.    Because a ruling in

Appellants'    favor would have no practical legal effect on the rules' validity, it

would constitute an impermissible advisory opinion and violate Texas' separation

9 See Hutto Citizens Grp. v. Cnty. of Williamson, No. 03-08-00578-CV, 2009 WL 2195582 (Tex.
App.-Austin     July 23, 2009, no pet.) (holding appeal mooted in case in which county and
intervening citizen's group sought a declaration that contract between county and waste
management company was void, where county and waste management company entered new
contract and only citizen's group maintained appeal).

                                             14
of powers principles.     See Nat'l Collegiate Athletic Ass 'n, I S.W.3d at 86 (Texas

courts prohibited from deciding moot controversies under separation of powers

doctrine); see also Tex. Const. art. II, § 1. The Texas Supreme Court has stated

that "the court's duty to dismiss moot cases arises from a proper respect for the

judicial branch's unique role under our constitution: to decide contested cases.

Under our constitution,      courts simply have no jurisdiction      to render advisory

opinions." Speer v. Presbyterian Children's Home & Servo Agency, 847 S.W.2d
227, 228-29 (Tex. 1993) (dismissing appeal as moot); see also Spring Branch

I.S.D.   V.   Reynolds, 764 S.W.2d 16, 18 (Tex. App.-Houston      [1st Dist.] 1988, no

writ) ("An advisory opinion from this Court is not necessary to protect the

government from abuse. It is well positioned to protect itself.").

         Any request     for relief by the Intervening   Defendants     In this appeal

necessarily would seek an advisory OpInIOn. An OpInIOn regarding the non-

existent new rules could only serve as possible future guidance concermng

hypothetical future rules because there is nothing that can now be done regarding

the legal effectiveness of the invalidated rules. See Camarena, 754 S.W.2d at 151

(trial court erred by awarding injunctive relief based on statute as amended while

                                           15
case pending; "courts, under our Constitution, do not give advice or decide cases

upon speculation, hypothetical or contingent situations.t'L'"

B. Under the APA, the TRC is a Necessary Party to an Action Challenging the
Validity of its Rules.

       This appeal should also be dismissed because the TRC is a necessary party

under the AP A.

       Section 2001.038 of the AP A establishes the right of an eligible plaintiff to

bring an "action for declaratory judgment" to challenge the validity or applicability

of an agency rule. Tex. Govt. Code Ann. §2001.038(a).              Significantly for purposes

of this appeal, Section 2001.038(c)          identifies the only person (other than the

plaintiff) who must be a party:         "The state agency must be made a party to the

action."   Id. §200 1.03 8(c) (emphasis added).11 The statute is clear in this respect:

in order for a court to entertain a challenge to an agency rule, the agency that

10 See also Tex. Ass 'n of Bus. v. Texas Air Control Bd., 852 S.W.2d 440, 444 (Tex. 1993) ("The

distinctive feature of an advisory opinion is that it decides an abstract question of law without
binding the parties."); Texas Parks and Wildlife Dept. v. Texas Ass'n of Bass Clubs, 622 S.W.2d
594 (Tex. App.-Austin          1981, writ refd n.r.e.) (notwithstanding claim that important
administrative law question was involved in mooted case, possibility of future agency action
would have constituted nothing more than advisory opinion on abstract question of law); Texas
Alcoholic Beverage Comm 'n v. Carlin, 477 S.W.2d 271, 274 (Tex. 1972) ("A decision of the
case would thus serve no purpose except to determine the law or the facts for the guidance of the
parties in the event another and different controversy should arise between them. The courts do
not sit for that purpose, and it is our opinion that the case is moot.").

11 This section has existed unchanged since the original 1975 Administrative Procedure and
Texas Register Act (APTRA), former V.A.C.S. art. 6252-13a. ACTS 1975, 64th Leg., ch. 61,
Sec. 12.

                                               16
promulgated the rule must be a party. In the absence of the agency, the "action"

cannot legally move forward.

        Although it was the lead defendant in the trial court proceedings, the TRC is

neither an "appellant" nor an "appellee" in this case. See Tex. R. App. P. 3.1(a)

(defining "appellant" as "a party taking an appeal to an appellate court"); 3.1(c)

("Appellee means a party adverse to an appellant")."                  The TRC had a right to

appeal the adverse ruling but elected not to. Therefore it is not a party to this

appeal on any issue concerning the validity of the trial court's judgment.

        The AP A requires the TRC to be an appellant to this appeal. The "action" to

which an agency "must" be a party under Sec. 2001.038(c) includes the appeal of

the district court rulemaking challenge.               Because the appeal of the underlying

lawsuit is part of the "action" for purposes of that section, then this appeal should

be dismissed. Dismissal is required when, as here, a necessary party is absent and

cannot be joined.       Cf Travis Heights Improvement Ass 'n v. Small, 662 S.W.2d
406, 413 (Tex. App.-Austin           1983, no writ) ("While such a situation is rare, there

are parties whose presence is so indispensible to the resolution of a cause of action

that their absence can deprive a court of jurisdiction to determine such."); Gilmer

 12 The TRC is not even a cross-appellee on Plaintiffs' cross-appeal, since Plaintiffs' cross-appeal
 concerns only whether the district court erred in sustaining certain objections by the Intervening
 Defendants to some of Plaintiffs' summary judgment evidence. The TRC and its Commissioners
 did not assert any objections to that evidence. In any event, the validity of the trial court's
judgment is not at issue on Plaintiffs' cross-appeal.

                                                  17
Ind. Sch. Dist. v. Dorfman, 156 S.W.3d 586, 588 (Tex. App.-Tyler             2003, no pet.)

(agency charged with enforcing statute must be made party to avoid advisory

opinion).

       Section     2001.038(c)'s   legislative      mandate   that   State   agencies   are

indispensible parties to a rulemaking challenge makes sense. Not only does an

agency both promulgate and enforce the regulation under attack, but it also (at least

in theory) represents the interest of the public, not any particular regulated

business.   When only private parties square off over the validity of a rule, the

public has no voice in the proceeding.           Such is also true on appeal.   Therefore,

Section 2001.038(c) properly requires agency party status at both the trial and

appellate level.

      When a State agency loses a rulemaking challenge in district court, its

decision not to appeal that judgment is significant.          The only fact that can be

discerned from the agency's        non-appeal is that the agency has accepted the

judgment.   Whether the agency likes the trial court's ruling is irrelevant.        By not

appealing, the agency has agreed to be bound by the lower court decision.               To

entertain an appeal by private party intervenors would constitute unwanted judicial

interference in the administrative process, even if the agency supported or tacitly

                                            18
agreed with having the private party intervenors carryon the fight for it.                  13   As Sec.

2001.038(c) mandates, no portion of a rulemaking challenge-at                       trial or appeal-

should proceed in the agency's absence.                 If the agency ceases to fight, the fight

ceases ..

        In this case, the TRC made the affirmative decision not to challenge the

district court's ruling invalidating its newly-promulgated               rules. The APA does not

permit an appeal to take place in the TRC' s absence.

                                  IV. Conclusion and Prayer

        This appeal is moot, and this Court lacks subject matter jurisdiction over it.

Given the absence of any appeal by the TRC, there is no case or controversy

between the remaining parties and the rules on which suit was initially brought are

void and now nonexistent.          Further, no relief sought by Appellants can be granted

because this Court cannot presume that the TRC will attempt to bring the

invalidated rules back to life, Appellants may not seek any relief as to the last valid

rules, and there is no judgment that this Court may enter than will have any

practical legal effect. The TRC is also an absent necessary party. This appeal and

13 For instance, in Diamond v. Charles, 476 U.S. 54 (1986), the state did not appeal but the
Attorney General filed a letter of interest stating that its "interest in this proceeding is identical to
that advanced by it in the lower courts and is essentially co-terminous with the position on the
issues set forth by the appellants." Id. at 61. The United States Supreme Court found this
insufficient to allow a private party to carry an appeal forward in the absence of the state.

                                                   19
the cross-appeal should be dismissed now for judicial economy and to enable the

parties to avoid further unnecessary briefing and expense on this appeal.     Costs

should be assessed against Appellants.    The mandate does not need to be issued

early. Movants pray for such other and further relief, both at law and in equity, to

which they may be deemed justly entitled.

                                         20
Respectfully submitted,

Raymond E. White
State Bar #: 21321950
MCGINNIS,   LOCHRIDGE     & KILGORE, LLP
600 Congress Ave., Ste. 2100
Austin, TX 78701
Phone: (512) 495-6035/Fax: (512) 505-6331
rwhite@mcginnislaw.com

By: lsi Raymond E. White
Raymond E. White
Attorney for AppelleelPlaintiff
Kickapoo Traditional Tribe of Texas

 Stephen Fenoglio
Attorney and Counselor at Law
713 West 14th Street
Austin, TX 78701
 State Bar#: 06904600
Phone: (512) 347-9944/Fax: (512) 482-8095
jsfenoglio@fenogliolaw.com
and
Anatole Barnstone
OFFICE OF ANATOLE BARNSTONE
State Bar#: 00793308
713 West 14th Street
Austin, TX 78701
Phone: (512) 327-2600/Fax: (512) 482-
8095
barnstonelaw@gmail.com

BY:~~                      ~
Anatole Barnstone    lr; ~       ~         0(   h.
Attorney for American Legion ~~~
Department of Texas

  21
                                       Terry L. Scarborough
                                       Hance, Scarborough LLP
                                       400 W. 15th St., Suite 950
                                       Austin, TX 78701
                                       Phone: (512) 479-8888IFax:    (512) 482-6891
                                       tscarborough@hslawmail.com

                                       By~,~~~~~           ..~~~~~
                                       Teny          'ough
                                       Attorneys for Thompson Allstate .tngo
                                       Supply, Inc. and Moore Supplies, Inc.

                      CERTIFICATE OF CONFERENCE

       The undersigned certifies that he conferred, or made a reasonable attempt to
confer, with all other parties about the merits of this motion to dismiss, and the
Appellants/Intervening Defendants oppose this motion.

                                       By: lsi Raymond E. White
                                       Raymond E. White

                         CERTIFICATE OF SERVICE

The undersigned certifies that the party/parties listed below was)}n;served    the
foregoing document(s) in the manner shown on the~        day of           ,2015.

                                              lsi Raymond E. White

Dudley D. McCalla                          EMAIL/E-FILE
JACKSON WALKER, LLP                        dmccalla@jw.com
100 Congress Ave. Ste. 1100
Austin, TX 78701
Attorney for Global Gaming LSP, LLC

John A. Cardwell                           EMAIL/E-FILE
1. Bruce Bennett                           cardwe1l53@earthlink.com
CARDWELL HART & BENNETT,                   j bb.ch blaw@me.com

                                         22
LLP
807 Brazos, Ste. 1001
Austin, TX 78701
Attorney for Global Gaming LSP, LLC

James C. Ho                                   EMAIL/E-FILE
Gibson, Dunn & Crutcher LLP                   jho@gibsondunn.com
2100 McKinney Avenue, Suite 1100
Dallas, TX 75201
Attorney for Sam Houston Race Park,
LLC

Phillip G. Oldham                             EMAIL/E-FILE
John P. Vacalis                               phillip.oldham@tklaw.com
Benjamin B. Hallmark                          john. vacalis@tklaw.com
Thompson & Knight                             benjamin.hallmark@tklaw.com
98 San Jacintio, Ste. 1900
Austin, TX 78701
Attorneys for Sam Houston Race Park,
LLC

Rob Hargrove                                  EMAIL/E-FILE
Ana Maria Marsland Griffith                   rob@texasenergylaw.com
Osborn, Griffith & Hargrove                   anamaria@texasenergylaw.com
515 Congress Ave., Ste. 2450
Austin, TX 78701
Attorneys for Texas Quarter Horse
Association

Martha S. Dickie                              EMAIL/E-FILE
A. Boone Almanza                              mdickie@abdlawfirm.com
Almanza, Blackburn & Dickie, LLP              balmanza@abdlawfirm.com
2301 S. Capital of Texas Hwy., Bldg. H
Austin, TX 78746
Attorneysfor Gillespie County Fair and
Festivals Association, Inc.

                                         23