Deceptive Trade Practices - Consumer Protection Act

Houston Court of Appeals affirmed the judgment, joining several othercourts holding DTPA claims are assignable'The Texas Supreme Court reversed and remanded, holding that anyDTPA claims

SMU Law Review

DECEPTIVE TRADE

PRACTICES-CONSUMER PROTECTION ACT

A Michael Ferrill*

Leslie Sara Hyman**

Sara Evans***

TABLE OF CONTENTS

I INTRODUCTION 760

II CONSUMER STATUS 760

III DECEPTIVE PRACTICES 763

A LAUNDRY LIST CLAIMS 763

B UNCONSCIONABILITY 767

C INCORPORATION OF THE DTPA INTO THE TEXAS INSURANCE CODE 768

IV DETERMINING THE MEASURE OF DAMAGES 770

A EVIDENCE OF DAMAGES 770

B ATTORNEYS' FEES 772

C MENTAL ANGUISH DAMAGES 773

V EXEMPTIONS, DEFENSES, AND LIMITATIONS ON RECOVERY 774

A EXEMPTIONS WITHIN THE DTPA 774

B PREEMPTION AND EXEMPTION FROM THE DTPA 775

C NECESSITY OF PROVING RELIANCE 776

D NECESSITY OF PROVING CAUSATION 778

E "As Is" CLAUSES 779

F A "MERE" BREACH OF CONTRACT IS NOT ACTIONABLE UNDER THE DTPA 780

G LIMITATIONS PERIOD 781

VI AWARD OF ATTORNEYS' FEES TO DEFENDANT 783

VII CONCLUSION 784

* B.B.A., St Mary's University; J.D., Baylor University; Shareholder, Cox Smith Matthews Incorporated, San Antonio, Texas.

** B.A., Brandeis University; J.D., Hastings College of the Law; Shareholder, Cox Smith Matthews Incorporated, San Antonio, Texas.

*** B.A., College of Wooster; J.D., Tulane University School of Law; Associate, Cox Smith Matthews Incorporated, San Antonio, Texas.

759

I INTRODUCTION

HE Texas Deceptive Trade Practices-Consumer Protection Act("DTPA")1 was enacted in 1973 "to protect consumers againstfalse, misleading and deceptive business practices, unconscionableactions, and breaches of warranty and to provide efficient and economicalprocedures to secure such protection.' '2 Although the Texas Legislatureenacted two sets of amendments in 2001 and additional amendments in

2003, there still are no reported decisions addressing those changes.This Survey covers significant developments under the DTPA from No-vember 1, 2003 through October 31, 2004 Noteworthy decisions duringthe Survey period address consumer status, laundry list violations, dam-ages, and reliance

II CONSUMER STATUS

In order to bring a DTPA claim, a plaintiff must be a "consumer" asthat term is defined by the statute.3 To qualify as a consumer, a plaintiffmust be an individual who seeks or acquires by purchase or lease goods

or services; those goods or services must form the basis of the plaintiff'scomplaint.4 Consumer status under the DTPA is dependent upon show-ing that the plaintiff's relationship to the transaction entitles him to re-lief.5

Whether a plaintiff qualifies for such status is a question of lawwhen the facts underlying the determination of consumer status areundisputed.6

The assignability of a DTPA claim based on the breach of expressed

warranty is an issue that was discussed in Summer 2002 Survey in PPG Industries, Inc v JMB/Houston Centers Partners Ltd Partnership 7 The

original building owner hired a window manufacturer to install windows

in the building One-fourth of the windows were defective, and the ufacturer was required to replace them pursuant to a warranty Severalyears later, the original owner sold the building and assigned his warrantyand DTPA claims to the purchaser When more window problems devel-oped, the new owner brought claims against the window manufacturer.The trial court entered a jury verdict in favor of the new owner and the

man-1 TEX Bus & CoM CODE ANN §§ 17.41 et seq (Vernon 2002 & Supp 2004-05).

2 Id § 17.44(a).

3 See id § 17.50.

4 Id § 17.45(4); Melody Home Mfg Co v Barnes, 741 S.W.2d 349, 351-52 (Tex.

1987) (citing Sherman Simon Enter., Inc v Lorae Servs Corp., 724 S.W.2d 13, 15 (Tex 1987); Cameron v Terrell & Garrett, Inc., 618 S.W.2d 535, 539 (Tex 1981)).

5 Amstadt v United States Brass Corp., 919 S.W.2d 644, 650 (Tex 1996); see also

Sanchez v Liggett & Myers, Inc., 187 F.3d 486, 491 (5th Cir 1999) (holding that a "DTPA claim requires an underlying consumer transaction; there must be a nexus between the

consumer, the transaction, and the defendant's conduct") (citing Amstadt, 919 S.W.2d at

650).

6 Vinson & Elkins v Moran, 946 S.W.2d 381, 406 (Tex App.-Houston [14th Dist.]

1997, writ dism'd by agr.).

7 146 S.W.3d 79 (Tex 2004).

Houston Court of Appeals affirmed the judgment, joining several othercourts holding DTPA claims are assignable'

The Texas Supreme Court reversed and remanded, holding that anyDTPA claims that the original owner of the building had against the win-dow manufacturer could not be assigned to the purchaser.9 The courtreviewed the history and goals of the DTPA, finding that the DTPA'sprimary goal is to protect consumers by encouraging them to bring con-sumer complaints.10 The court reasoned that assigning DTPA claimswould defeat the purpose of the statute, which is to encourage consumers

to bring complaints themselves.'1 Allowing DTPA claims to be assigned,according to the court, would allow large companies to assert DTPAclaims by stepping into the shoes of qualifying consumers.12 First, thecourt found that the treble-damage provisions of the DTPA were in-tended to motivate consumers, not those considering litigation for com-mercial profit.13 In the court's words, "the personal and punitive aspects

of DTPA claims cannot be squared with a rule allowing them to be signed as if they were mere property ' 14 Additionally, consumers would

as-be at a severe negotiating disadvantage to entrepreneurs willing to buyDTPA claims Thus, allowing DTPA claims to be assigned could result inconsumers being deceived twice.15 Finally, the court reasoned that con-sumers may not be sophisticated enough to understand the claims theyare assigning.16 In the case of a general assignment included in contrac-tual boilerplate language, consumers may not know they have DTPAclaims when they assign them.17

The decision does not fully resolve the issue of assignability andsurvivability of DTPA claims Although the court held that DTPA war-ranty claims may not be assigned, it specifically did not decide issues ofsurvivability or assignment of other, "pure" DTPA claims.18 The courtalso declined to decide whether DTPA claims survive to a consumer'sheirs.1 9 Additionally, the court held that its ruling does not prohibit equi-table assignments, such as a contingent-fee interest assigned to a con-sumer's attorney.20

In Roof Systems, Inc v Johns Manville Corporation, 2 1 a roofing

sub-contractor sought consumer status in connection with a roofing project.Roof Systems received a subcontract to install roofs on two schools The

subcontract required Roof Systems to provide a ten-year warranty on theroof systems as a condition to final payment Johns Manville Corporation("JMC") provided roofing materials for the schools JMC asserted that itwould not issue its "Gold Shield Roofing System Guaranty" unless theroof systems were installed by a JMC-certified installer; Roof Systemswas not so certified Roof Systems attempted to arrange for a JMC-certi-fied installer to install the roof systems as a sub-subcontractor The par-ties disagreed as to whether JMC approved this arrangement It wasundisputed that, prior to resolving the approval question, Roof Systemsreceived written notice from the general contractor that it was contractingwith another roofing company, because Roof Systems failed to provide awritten warranty acknowledgment.22

JMC moved for summary judgment, arguing in part that Roof Systemswas not a consumer, because its complaint was based upon JMC's refusal

to give a warranty and not based upon any goods or services sought oracquired from JMC Roof Systems responded only that it sought to ac-quire roofing materials but did not address the second part of the test-whether the goods or services formed the basis of its complaint.23 Thetrial court granted JMC's motion, and on appeal, the Houston Court ofAppeals held that "[a] refusal to sell goods or services is not a complaintbased upon the goods or services for purposes of DTPA consumer sta-tus."' 24 Roof Systems' DTPA claim was not based upon the terms or thebreach of a warranty, but on JMC's refusal to issue a warranty.25 Thecourt held that such a claim was not based upon any goods or servicesthat Roof Systems sought or acquired from JMC and that as a matter oflaw Roof Systems was not a DTPA consumer.2 6

In Jabri v Alsayyed, 2 7

the lessee of a convenience store sued the ownerand his corporation for fraud and violations of the DTPA The corpora-tion operated Jabri's convenience stores and leased one of its stores toAlsayyed Jabri told Alsayyed that the store was an ongoing businesswith a good consumer base that would generate a profit of about $10,000per month Alsayyed did not realize the profits promised by Jabri Thejury found that both Jabri and his corporation knowingly engaged in anunconscionable course of action that was a producing cause of damages

to Alsayyed The jury also found that Alsayyed suffered mental anguishdamages as a result of Jabri and the corporation's actions.28

On appeal, Jabri and his corporation argued that the trial court erred inupholding the jury's award of damages because Alsayyed was not a

22 Id at 433-34.

23 Id at 440.

24 Id.

25 Id.

26 Id at 441 Roof Systems argued for the first time on appeal that the warranty was

an integral, inseparable part of the roofing materials transaction, but the court refused to

consider the argument because it was not raised before the trial court Id at 440 n.19.

27 145 S.W.3d 660 (Tex App.-Houston [14th Dist.] 2004, no pet h.).

28 Id at 665.

DTPA consumer.29 In evaluating Alsayyed's consumer status, the ton Court of Appeals examined whether his objective was the purchase

Hous-or lease of a good Hous-or service.30 The DTPA excludes claims based ontransactions conveying intangible property rights.3 1 Appellants arguedthat Alsayyed's DTPA claim was based on his purchase of the goodwill of

a business, which is an intangible.3 2 The court disagreed, finding that

Al-sayyed not only purchased the store's goodwill, but also purchased theinventory and services associated with operating the store.3 3 Becausegoods and services were an objective of the transaction, and not merelyincidental to it, the court concluded that Alsayyed qualified for DTPAconsumer status.34

III DECEPTIVE PRACTICES

In addition to establishing consumer status, a DTPA plaintiff mustshow that a "false, misleading, or deceptive act," breach of warranty, un-conscionable action, or course of action occurred and that such conductwas the producing cause of the plaintiff's damage.3 5

A LAUNDRY LIST CLAIMSDTPA section 17.46(b) contains, in twenty-seven subparts, a nonexclu-sive list of actions that constitute "false, misleading or deceptive acts"under the statute.3 6 Plaintiffs invoking these "laundry list" claims aregenerally not required to prove or plead the defendant's state of mind orintent to deceive.37 Several significant cases involving laundry list claimswere decided during the Survey period

The plaintiff in Cendant Mobility Services Corp v Falconer 38 chased his home from a relocation company selling the property for theformer owner After a severe drought, the plaintiff saw damage to inte-rior and exterior walls and floors as well as serious and widespread struc-tural flaws He sued the relocation company, alleging that it had failed todisclose that the home's foundation had shown evidence of past substan-tial movement and provided only a portion of the relevant engineer's re-port The trial court entered judgment for the plaintiff on a jury verdictand the defendant appealed.3 9

pur-The Texarkana Court of Appeals reversed and rendered a take nothing

37 Pennington v Singleton, 606 S.W.2d 682, 689 (Tex 1980) Several subsections do

explicitly involve an element of scienter See, e.g., TEX Bus & CoM CODE ANN.

§§ 17.46(b)(9), (10), (13), (16), (17) & (24) (Vernon 2002 & Supp 2004-05).

38 135 S.W.3d 349 (Tex App.-Texarkana 2004, no pet h.).

39 Id at 350-51.

judgment.40 The evidence at trial established that the defendant providedthe plaintiff with a report that specifically stated, "The foundation showsevidence of a substantial amount of movement in the past."' 41 Despitethe plaintiff's admission that he received and initialed the relevant por-tions of the report, he maintained that he was misled by the seller's agent,because she selectively informed him of certain portions of the prior own-ers' disclosure and the report.42 The court held that the seller's agent had

no duty to explain the disclosures or reports and that the information inthose documents was clear and unambiguous.43 Absent evidence offraud, the parties to a contract have an obligation to read what they sign.The plaintiff failed to present evidence of an affirmative misrepresenta-tion, so the court held that there was no evidence that the seller failed todisclose information in an attempt to fraudulently induce the plaintiff tocontract.44

In Allstate Texas Lloyds v Mason, 45 homeowners sued Allstate TexasLloyds claiming that foundation damage to the home was covered undertheir homeowners' insurance policy Allstate hired an engineer who in-spected the house and determined that the damage was caused not by aplumbing leak, which would have been covered, but by subsurface drain-age problems Allstate denied coverage and the homeowners sued forbreach of contract, breach of the duty of good faith and fair dealing, un-conscionable conduct, and DTPA violations The jury found in favor ofthe homeowners and found that the DTPA violations had been commit-ted knowingly and Allstate appealed.46

The Fort Worth Court of Appeals reversed the DTPA claim.47 Thecourt held that the engineer hired by Allstate conducted an adequate in-vestigation and that, based on the evidence available to Allstate, therewas no evidence suggesting that the engineer's investigation was unrelia-ble or that Allstate acted unreasonably in relying on that investigation indenying coverage.48 Thus, Allstate did not make any misrepresentationsabout coverage or unreasonably refuse to pay a claim, and the jury's ver-dict on the DTPA claim could not stand.49

Barnett v Coppell North Texas Court, Ltd 50 arose from an attempt tobuild a gymnastics facility The Lewises contracted with Barnett to buildthe North Texas Family & Sports Complex and secured a loan from Leg-

40 Id at 351.

41 Id at 352.

42 Id.

43 Id at 354.

44 Id.; see also E.R Dupuis Concrete Co v Penn Mut Life Ins Co., 137 S.W.3d 311,

323 (Tex App.-Beaumont 2004, no pet h.) (denying relief on claim of failure to disclose for lack of evidence).

45 123 S.W.3d 690 (Tex App.-Fort Worth 2003, no pet.).

acy Bank on the project Barnett began construction in the summer of

1998 and walked off the unfinished job during the summer of 1999 acy Bank sued the Lewises and Barnett and foreclosed on the property.The Lewises cross-claimed against Barnett who answered and filed across-claim against the Lewises The Bank's claims were resolved and theBarnett/Lewis claims were tried to a jury, which found for the Lewises.5 1Barnett appealed, arguing in part that the evidence was legally and fac-tually insufficient to support the jury's findings of DTPA violations.52The Dallas Court of Appeals held that there was sufficient evidence of aDTPA violation.53 Specifically, David Lewis testified that he relied onBarnett for the management and construction of the project, that "Bar-nett promised 'three times the facility for one and a half times the amount

Leg-of money' in a more desirable location," and that Barnett led Lewis tobelieve that the contractual amount was "more than adequate to buildthis project '54 Barnett guaranteed he would finish the project for a cer-tain sum even if costs increased and represented that the building would

be completed in six months and would be of "great" quality.55 Lewis alsotestified that Barnett was hired because of his representations and thatthe Lewises relied on those representations.56 The Dallas Court of Ap-peals affirmed the verdict on the DTPA claim, holding that the evidencesupporting the jury findings was not so weak as to be clearly wrong andunjust.57

In Rosas v Hatz, 58 home purchasers sued a realtor and the sellers forbreach of contract, negligent misrepresentation, fraud, and DTPA viola-tions after the purchasers discovered undisclosed electrical and plumbingproblems The realtor filed a motion for summary judgment raising bothtraditional and no evidence grounds The trial court granted the motion

on the DTPA claims without specifying the basis of its ruling.59 The chasers appealed, and the Waco Court of Appeals reversed andremanded.60

pur-In response to the realtor's no evidence summary judgment motion, thepurchasers produced evidence that included the realtor's deposition testi-mony.61 According to the realtor's deposition, the renter of the hometold the realtor "her water bills were high and she thought there was aleak."'62 The purchasers testified that the realtor did not disclose the in-formation regarding the leak, but instead represented that the house had

been re-wired and fit with new plumbing That statement, in combinationwith the evidence that the renter told the realtor of a leak, created a factissue as to whether the realtor knew of the problems with the home andwithheld that information.6 3 The court of appeals held that the trial courterred in granting the summary judgment motion, because a fact issue ex-isted as to whether the realtor's statements were affirmative representa-tions of false information.64

The plaintiff in Tolpo v Decordova 65

sued his former attorney for legalmalpractice, breach of contract, fee forfeiture, and violations of theDTPA Tolpo alleged that his attorney negligently prepared and drafted

a contract for unimproved property The attorney moved for summaryjudgment on the DTPA claims, arguing that Tolpo's claims were merelyrestated claims for legal malpractice.66 The trial court entered summaryjudgment in favor of the attorney, and the Beaumont Court of Appealsaffirmed.67

The attorney used a pre-printed form and followed the client's tions in preparing the contract The earnest money contract, however,did not address the issue of mineral reservations and easements.68

instruc-Thecourt found that Tolpo did not produce evidence that the attorney's ac-tions failed to meet the standard of care for a reasonably prudent attor-ney.69 Specifically, Tolpo did not contend that the attorney was awarethat he was excluding a contract term or that the attorney affirmativelymisrepresented the effect of the contract.70

Tolpo's DTPA claim, ing to the court, was merely a restated claim for legal malpractice.7 1

accord-Thecourt held that negligent conduct might be legal malpractice but is not aviolation of the DTPA.72 Tolpo's allegations thus did not support an in-dependent cause of action under the DTPA separate from a malpracticecause of action, and summary judgment on the DTPA claim was proper.7 3

Willowbrook Foods, Inc v Grinnell Corp 74

arose from a fire ing in a turkey fryer that spread and damaged a turkey processing plantand its contents The owners and operators of the processing plantbrought an action for strict liability based on defective design, manufac-ture and marketing, breach of warranty, negligence, and DTPA viola-tions Emerson, a supplier of a component part of the turkey fryer,moved for summary judgment on the DTPA claims on the grounds thatthere was no evidence of any false, misleading, or deceptive act on Emer-

son's part The trial court granted the motion and the plaintiffs pealed.7 5 The San Antonio Court of Appeals reviewed the plaintiffs'response to the summary judgment motion, in which the plaintiffsclaimed that Emerson failed to advise or warn them of the proper use ofits product.7 6 For example, the plaintiffs alleged that Emerson did notrecommend certain safety measures and failed to indicate the critical ef-fects of sensor contamination.7 7 The court found, however, that Emer-son's mere nondisclosure of material information was not enough toestablish an actionable DTPA claim To establish a violation of theDTPA, the plaintiffs needed to show that Emerson had knowledge of theundisclosed information and intentionally withheld it In addition, theplaintiffs were required to show that the information was withheld withthe intent of inducing the consumer to engage in a transaction.78 Thecourt concluded that the plaintiffs were not entitled to recover damagesfor nondisclosure under the DTPA, because they failed to raise a genuineissue of material fact on the elements of the claim.79

ap-B UNCONSCIONABILITY

Section 17.45(5) of the DTPA defines an "unconscionable action orcourse of action" as "an act or practice which, to a consumer's detriment,takes advantage of the lack of knowledge, ability, experience, or capacity

of the consumer to a grossly unfair degree."' 80 In Allstate Texas Lloyds v Mason, 81 Allstate sent its insureds a letter stating it would attempt to givethem "every advantage" of their policy The homeowners argued thatAllstate was not interested granting the benefits due to them but instead

was interested in performing a sham investigation of their foundation

damage claim with the purpose of denying the claim regardless of theconsequences.82 The court held that Allstate did not perform an unrea-sonable investigation and did not violate its duty of good faith and fairdealing.8 3 Accordingly, there was no evidence of unconscionable conduct

80 TEX Bus & COM CODE ANN § 17.45(5) (Vernon 2002).

81 123 S.W.3d 690 (Tex App.-Fort Worth 2003, no pet.) Allstate Texas Lloyds was

discussed in note 44 and the accompanying text.

82 Id at 706.

83 Id.

84 Id.; see also E.R Dupuis Concrete Co v Penn Mut Life Ins Co., 137 S.W.3d 311

(Tex App.-Beaumont 2004, no pet h.) (holding that investor's allegations that insurance agents attended the same church as insured, obtained insured's trust by showing him how much money he could save through estate planning, and selected investments did not con- stitute unconscionable conduct).

D TPA

2005]

C INCORPORATION OF THE DTPA INTO THE TEXAS

Code.87

In Perez v Blue Cross Blue Shield of Texas, Inc.,88 the Austin Court of

Appeals considered whether Blue Cross's denial of coverage constitutedsufficient evidence of a DTPA violation to survive summary judgment.Debra Perez applied to Blue Cross for an individual health insurance pol-icy for herself and her son, Brandon She stated on the application thather son had Down Syndrome but was very healthy Blue Cross providedcoverage for Debra but excluded Brandon because of his Down Syn-drome Brandon, through his mother, sued Blue Cross individually and

on behalf of similarly situated individuals alleging that Blue Cross's policy

of denying coverage to healthy persons with Down Syndrome violatedthe Insurance Code and DTPA section 17.46(b)(12) The trial courtgranted summary judgment in favor of Blue Cross and Brandon ap-pealed.89 The Austin Court of Appeals affirmed, holding that section17.46(b)(12) requires evidence that the defendant represented "that anagreement confers or involves rights, remedies, or obligations which itdoes not have or involve, or which are prohibited by law."90 Blue Crossmade no promise of coverage in the application and instead specificallystated that coverage was subject to approval by Blue Cross.91 Becausethere was no evidence that Blue Cross made any misrepresentations, thecourt affirmed summary judgment in favor of Blue Cross.92

Dallas Fire Insurance Co v Texas Contractors Surety & Casualty

agreement Texas Contractors Surety and Casualty Agency ("TCSCA")

85 Statutes either incorporating provisions of the DTPA or permitting recovery for

their violation via the DTPA include: TEX Occ CODE ANN §§ 351.604, 702.403 (Vernon

2004); TEX PROP CODE ANN § 41.007 (Vernon 2000); TEX PROP CODE ANN §§ 59.005,

221.024, 221.071, 222.011 (Vernon 1995); TEX Bus & COM CODE ANN § 35.74(c)

(Vernon 2002); TEX HEALTH & SAFETY CODE ANN § 164.013 (Vernon 2001); TEX INS.

CODE art 21.21 (Vernon 1981); TEX REV Civ STAT art 9020 (Vernon 1981); and TEX.

TRANSP CODE ANN § 684.086 (Vernon 1999).

86 TEX INS CODE ANN art 21.21.

87 Allstate Ins Co v Watson, 876 S.W.2d 145, 149 (Tex 1994).

88 127 S.W.3d 826 (Tex App.-Austin 2003, pet denied).

was formed to sell contract surety bonds TCSCA agreed with DallasFire Insurance Company to the terms of a subagency agreement including

a commission structure Dallas Fire subsequently changed the manner ofcalculating TCSCA's commissions retroactively to the beginning of theparties' relationship in a manner that significantly limited further com-missions and resulted in a claim by Dallas Fire for reimbursement forcertain previously paid commissions TCSCA sued and the case was tried

to a jury on TCSCA's claims of breach of contract and Insurance Codeviolations based on misrepresentations by Dallas Fire in violation ofDTPA section 17.46(b)(12) and on counterclaims by Dallas Fire Thejury found that Dallas Fire knowingly misrepresented the rights, reme-dies, or obligations of the parties and awarded damages to TCSCA.94

On appeal, Dallas Fire argued that the parties' dispute did not arise out

of the "business of insurance" because TCSCA only sold contract suretybonds.95 The Fort Worth Court of Appeals disagreed holding that, al-though the Texas Supreme Court had held that the relationship between

a surety and its obligee was not covered by article 21.21 of the InsuranceCode,96 the case before the court did not involve such a relationship In-stead, the court noted that surety bonds are insurance products for pur-poses of Insurance Code provisions relating to agent licensure and thatTCSCA's principals were required to be licensed as insurance agents tosell surety bonds.97 The court concluded that it was obliged to construearticle 21.21 liberally and that, as a matter of law, the dispute betweenTCSCA and Dallas Fire arose out of the "business of insurance."98The Texas Supreme Court reversed and rendered judgment for DallasFire, holding that although surety bonds are insurance products for pur-poses of Insurance Code provisions relating to agent licensure, the Insur-ance Code defines the "business of insurance" differently in multiplesections of the code, and TCSCA's claims did not arise in context of thelicensure requirements.99 The court held that the Fort Worth Court of

Appeals had interpreted Great American Insurance Co too narrowly and

that the holding applied to suretyship generally, not only to suits betweensureties and their bondholders.100 The Texas Supreme Court concludedthat "suretyship, as historically understood in the insurance and surety-ship fields, does not constitute the business of insurance under article21.21."101 Thus, because TCSCA's claims involved the business of surety-ship, not the business of insurance, the court rendered judgment that TC-

SCA take nothing on its claims under article 21.21.102

IV DETERMINING THE MEASURE OF DAMAGES

A prevailing plaintiff in a DTPA action may recover economic ages.10 3 In cases involving misrepresentation, the plaintiff may recoverunder either the "out of pocket" or "benefit of the bargain" measure ofdamages, whichever gives the plaintiff a greater recovery.10 4 If the trier

dam-of fact finds that the defendant acted "knowingly," the plaintiff also mayrecover damages for mental anguish and additional statutory damages up

to three times the amount of economic damages.10 5

A EVIDENCE OF DAMAGES

Ford Motor Co v Cooper' 0 6 arose from the sale of a new 1998 LincolnTown Car from Crane Lincoln Mercury After experiencing a steeringproblem with the vehicle, Cooper sued Crane and Ford alleging breach ofwarranty and DTPA violations Cooper testified that, in the car's dam-aged condition, it was worthless for taking long trips, which was the pur-pose for which he purchased it The jury found in favor of Cooper andawarded $5,000 for diminished value of the vehicle, $1,000 for expenses,and additional damages based upon a finding of knowing conduct Thetrial court reduced the award and rendered judgment for $18,000.107

On appeal, Crane and Ford argued that the evidence was legally ficient to support the award of actual damages.10 8 The Texarkana Court

insuf-of Appeals agreed.10 9 Cooper pled for the difference between the fairmarket value of the car as sold and the value as warranted and repre-sented."0 The court held that evidence of the negotiated price for thenew car established its value as warranted and represented."1 The onlyevidence of the value as sold, however, was Cooper's own testimony."12

Citing the Texas Supreme Court's decision in Porras v Craig, 11 3 the arkana Court of Appeals explained that an owner of property can testify

Tex-as to its market value Tex-as long Tex-as the testimony shows that it refers tomarket value, rather than some other value of the property."4 BecauseCooper's testimony referred to the value of the car to him, and did notreference the car's market value, the testimony constituted no evi-

102 Id.

103 TEX Bus & COM CODE ANN § 17.50(b)(1) (Vernon 2002).

104 Leyendecker & Assocs v Wechter, 683 S.W.2d 369, 373 (Tex 1984).

105 TEX Bus & COM CODE ANN § 17.50(b)(1) (Vernon 2002).

106 125 S.W.3d 794 (Tex App.-Texarkana 2004, no pet h.).