author: ADELE HEDGES, Chief Justice.

text:
    Alzada HECTOR, Appellant, v. CHRISTUS HEALTH GULF COAST d/b/a Christus St. Joseph Hospital and Canaan L. Harris, M.D., Appellees.
    No. 14-04-00625-CV.
    Court of Appeals of Texas, Houston (14th Dist.).
    Aug. 18, 2005.

      Robert A. McAllister, Houston, for appellant.
    Matthew Brendan E. Hughes, T. Marc Calvert, Houston, for appellees.
    Panel consists of Chief Justice HEDGES and Justices FOWLER and FROST.
   OPINION

ADELE HEDGES, Chief Justice.

Appellant, Alzada Hector, was injured when she fell from an operating table during surgery to remove cancer from her ear. Ms. Hector brought suit against the hospital and the surgeon. The trial court dismissed Ms. Hector’s case against each defendant for her failure to provide an expert report as required by the Texas Medical Liability and Insurance Improvement Act. Ms. Hector brings this appeal, claiming that the trial court abused its discretion in dismissing her suit. We affirm.

Background

Ms. Hector underwent surgery at St. Joseph’s Hospital (“StJoseph’s”) in June of 2001 to remove a cancerous tumor from her left ear. At the time, she was 71 years old. During the surgery, while appellant was under general anesthesia, she was rotated so that the physician, Dr. Canaan Harris (“Harris”), could better examine her. While she was being rotated, Ms. Hector fell off the table, suffering a cut to her right brow area that necessitated eight stitches. The operation was completed and Ms. Hector recovered from the surgery. Tests performed subsequent to the surgery showed no neurological or spinal damage resulting from her fall from the table.

Ms. Hector filed suit against Harris and St. Joseph’s on October 24, 2002, but did not file an expert report within 180 days as required by section 13.01(d)(1) of former Texas Revised Civil Statutes article 4590i, also known as the Texas Medical Liability and Insurance Improvement Act (“4590i”). Pursuant to section 13.01(e)(3) of 4590i, the trial court dismissed her claims against Dr. Harris on October 14, 2003, and her claims against St. Joseph’s on April 16, 2004. Ms. Hector brings this appeal, claiming that an expert report was not necessary.

Whether 4590i Applies

In her first issue, Ms. Hector claims that 4590i does not apply to her case because her case is one of ordinary negligence (as opposed to medical malpractice); therefore, an expert report was not necessary. As a result, she asserts, the trial court abused its discretion in dismissing her claim for her failure to file a 4590i-required expert report. We disagree.

We review a dismissal under 4590i under an abuse of discretion standard; however, to the extent the resolution of this issue requires interpretation of the statute, we review under a de novo standard. See Buck v. Blum, 130 S.W.3d 285, 290 (Tex.App.-Houston [14th Dist.] 2004, no pet.). Section 1.03 of 4590i defines “health care liability claim” as follows:

“Health care liability claim” means a cause of action against a health care provider or physician for treatment, lack of treatment, or other claimed departure from accepted standards of medical care or health care or safety which proximately results in injury to or death of the patient, whether the patient’s claim or cause of action sounds in tort or contract.

In determining whether a particular case presents a health care liability claim, we must examine the underlying nature of the allegations; in doing so, we are not bound by the party’s characterization of the claims. Buck, 130 S.W.3d at 290-91. A cause of action will generally be considered a health care liability claim if it is based on a breach of a standard of care applicable to health care providers. Id. The complained-of act or omission must have been an inseparable part of the rendition of medical services. Id.

Here, it is abundantly clear that 4590i applies to Ms. Hector’s claims. Her claims against St. Joseph’s, a health care provider, and Harris, a physician, were based on their alleged departure from accepted standards of safety, i.e., not letting a patient fall from an operating table. These alleged departures proximately resulted in Hector’s alleged injury.

Hector urges that, since the operating table was under the control of hospital employees that were non-medical providers, the alleged act of negligence concerns “administrative, ministerial, or routine care”; therefore, 4590i should not apply to her claim.

In Cobb v. Dallas Fort Worth Medical Center, the wrong-sized screws were used in a patient’s back. 48 S.W.3d 820 (Tex.App.-Waco 2001, no pet.). In reviewing the court’s granting of summary judgment against the Cobbs, the majority did not address whether her claim fell within 4590i. However, in his concurring opinion, Judge Vance drew a distinction between hospital workers that were health care providers, such as nurses and doctors, and hospital workers that were not, such as cooks or electricians. Id. at 829-30 (Vance, J. concurring). While we agree with Judge Vance’s distinction, we find it unpersuasive here since any person in the operating room at the time of Hector’s accident would necessarily have been considered a health care provider. See id. The other cases Ms. Hector cites for support are equally unpersuasive in that, in those cases, whether medical liability claims fell under 4590i was not at issue. See Tenet Health Ltd. v. Zamora, 13 S.W.3d 464 (Tex.App.-Corpus Christi 2000, pet. dism’d w.o.j.) (doctor sued hospital over privileges); Mills v. Angel, 995 S.W.2d 262 (Tex.App.-Texarkana 1999, no pet.) (parents sued hospital over credentialing and use of equipment); Baptist Memorial v. Marrable, 244 S.W.2d 567 (Tex.Civ.App.-San Antonio 1951, no writ) (case pre-dates 4590i); Medical & Surgical Memorial Hospital v. Cauthorn, 229 S.W.2d 932 (Tex.App.-El Paso 1949, writ refd n.r.e.) (case pre-dates 4590i).

We find that Ms. Hector’s case falls squarely within the ambit of 4590i; an expert report was therefore necessary. Her first issue is overruled.

Res Ipsa Loquitur

In her second issue, Ms. Hector claims that even if 4590i governs her case, the doctrine of res ipsa loquitur applies, thus obviating the need for an expert report under 4590L We find that res ipsa loquitur does not apply to her claim.

Section 13.01 of 4590i requires as follows:

(d) Not later than the later of the 180th day after the date on which a health care liability claim is filed or the last day of any extended period established under Subsection (f) or (h) of this section, the claimant shall, for each physician or health care provider against whom a claim is asserted:
(1) furnish to counsel for each physician or health care provider one or more expert reports, with a curriculum vitae of each expert listed in the report; or
(2) voluntarily nonsuit the action against the physician or health care provider.

Section 13.01(j) of the act goes on to state that an expert report is not required for any issue other than an issue related to liability or causation.

Upon a showing of good cause by motion and a hearing by the plaintiff, the trial court may grant one thirty-day extension of the report-filing deadline. Should a plaintiff fail to comply with 13.01(d), however, 4590i mandates that the trial court shall award as sanctions, inter alia, the defendant’s reasonable attorney’s fees and the dismissal of the plaintiffs suit with prejudice. We review a trial court’s dismissal under section 13.01 under an abuse of discretion standard. Am. Transitional Care Ctrs. of Tex., Inc. v. Palacios, 46 S.W.3d 873, 877 (Tex.2001).

The doctrine of res ipsa loquitur, literally “the thing speaks for itself,” applies in certain cases in which the circumstances surrounding an accident constitute sufficient evidence of the defendant’s negligence to support such a finding. Haddock v. Arnspiger, 793 S.W.2d 948, 950 (Tex.1990). The doctrine is applicable only when: (1) the character of the accident is such that it would not ordinarily occur in the absence of negligence; and (2) the instrumentality causing the injury is shown to have been under the management and control of the defendant. Id. The rule is not a cause of action separate and apart from negligence; instead, it is an evidentiary rule by which negligence may be inferred by a jury. Id.

Section 7.01 of 4590i, enacted in August of 1977, restricts the use of res ipsa loquitur as follows:

The common-law doctrine of res ipsa loquitur shall only apply to health care liability claims against health care providers or physicians in those cases to which it has been applied by the appellate courts of this state as of the effective date of this subchapter.

In Haddock, the supreme court noted that res ipsa loquitur was generally inapplicable in medical malpractice cases, but gave examples of the cases in which res ipsa loquitur had been applied because “the nature of the alleged malpractice and injuries are plainly within the common knowledge of laymen, requiring no expert testimony.” 793 S.W.2d at 951. These three general categories listed by the Haddock court include “negligence in the use of mechanical instruments, operating on the wrong portion of the body, or leaving surgical instruments or sponges within the body.” Id.

We must first decide whether the doctrine of res ipsa loquitur applies; we find that it does not. While it is a given that a patient should not fall from an operating table during surgery, how an operating table works, the method of securing a patient to an operating table, or the procedures for rotating a patient during surgery are not necessarily within the common knowledge of laymen. See id. Appellant cannot therefore show that the character of the accident is such that it would not ordinarily occur in the absence of negligence.

Even if res ipsa loquitur did apply, Ms. Hector would still have to show that it fell within one of the pre-1977 categories of cases. See id., 793 S.W.2d at 951. Ms. Hector contends that her case falls within the “mechanical instruments” category. No Texas court has previously considered whether an operating table can be considered a mechanical instrument; in fact, Ms. Hector recognizes that the “closest case” to the facts of the present case are those in which a patient fell out of a hospital bed. See Thorson v. Rosewood Gen. Hosp., 608 S.W.2d 282 (Tex.App.Houston [14th Dist.] 1980, writ ref d n.r.e.) (finding that hospital did not breach its standard of care and appellant was therefore unable to prove appellee’s negligence); Hilzendager v. Methodist Hosp., 596 S.W.2d 284 (Tex.Civ.App.-Houston [1st Dist.] 1980, no writ) (holding that plaintiff did not raise a fact issue as to whether hospital was negligent in failing to raise bed rails). Thorson and Hilzendager, however, did not address the issue of res ipsa loquitur as applied to 4590i cases. They are therefore unhelpful to Ms. Hector’s case.

Ms. Hector also cites Martin v. Petta in support of her contention that an operating table is a mechanical instrument. 694 S.W.2d 233, 239-40 (Tex.App.-Fort Worth 1985, writ refd n.r.e.). The plaintiff in Martin v. Petta received a broken toe while in the hospital for hemorrhoid surgery. Id. at 234. The court never reached a decision on whether an operating table could be an instrument; furthermore, the opinion, which reviewed the trial court’s granting of summary judgment, addressed the doctrine of res ipsa loquitur in the context of whether a genuine issue of material fact had been raised. Id. at 240. We find this case unhelpful to Ms. Hector’s claim as well.

In the alternative, Ms. Hector claims that because she was injured on a part of her body not under treatment, her case falls within the “operating on a wrong part of the body” exception under 4590i and res ipsa loquitur should apply. We find that this argument fails as well — the wrong part of Ms. Hector’s body was not operated on; the correct part of her body (her ear) was operated on as planned. See, e.g., Manax v. Ballew, 797 S.W.2d 71, 72 (Tex.App.-Waco 1990, writ denied).

Furthermore, even if the doctrine of res ipsa loquitur did apply to Ms. Hector’s claim, she would still be required to file an expert report under 4590i; we do not interpret section 7.01 of 4590i as an exception to the expert report requirement of section 13.01. In a recent decision, the Texas Supreme Court noted that

It must also be borne in mind that article 4590i’s expert report requirement establishes a threshold over which a claimant must proceed to continue a lawsuit. It does not establish a requirement for recovery. It may be that once discovery is complete and the case is tried, there is no need for expert testimony. ... But the Legislature envisioned that discovery and the ultimate determination of what issues are submitted to the factfinder should not go forward unless at least one expert has examined the case and opined as to the applicable standard of care, that it was breached, and that there is a causal relationship between the failure to meet the standard of care and the injury, harm, or damages claimed.

Murphy v. Russell, 48 Tex.Sup.Ct. J. 943, 944, 2005 WL 1537244 at *2 (Tex. July 1, 2005) (per curiam) (emphasis added). Although the opinion in Murphy does not address res ipsa loquitur specifically, we do find it pertinent to the case at bar as it draws a distinction between an expert report at the onset of litigation and the need for expert testimony at trial. We do not opine whether there is a conceivable case in which res ipsa loquitur might preclude the need for expert testimony to prove various elements of negligence at the trial stage. We do not believe, however, that the Legislature intended for it to eliminate the procedural requirement of an expert report at the commencement of litigation.

Other courts, including this one, have noted that even if res ipsa loquitur does apply to a certain case, an expert report or some form of expert testimony is still required. See Ruiz v. Walgreen Co., 79 S.W.3d 235, 239-40 (Tex.App.-Houston [14th Dist.] 2002, no pet.); Traut v. Beaty, 75 S.W.3d 661, 667-68 (Tex.App.-Texarkana 2002, no pet.); Steinkamp v. Caremark, 3 S.W.3d 191, 199 (Tex.App.-El Paso 1999, pet. denied) (“causation in a medical negligence case must be proved by expert testimony”); Kalteyer v. Sneed, 837 S.W.2d 848, 853 (Tex.App.-Austin 1992, no writ); see also Garcia v. Palestine Mem’l Hosp., No. 14-00-01144-CV, 2002 WL 192359, at *2 (Tex.App.-Houston [14th Dist.] February 7, 2002) (not designated for publication); Simmons v. Williams, No. 14-99-00494-CV, 2000 WL 1862858, at *2 (Tex.App.-Houston [14th Dist.] December 21, 2000) (not designated for publication).

Because we find that an expert report was required under 4590i, the trial judge did not abuse his discretion in dismissing Ms. Hector’s claim. Ms. Hector’s second issue is overruled.

We affirm the judgment of the trial court.

      . Act of May 30, 1977, 65th Leg., R.S., ch. 817, 1977 Tex. Gen. Laws 2039, 2039-64 (formerly codified at Tex.Rev.Civ. Stat. Ann. art. 4590i, §§ 1.01-16.02), repealed and recodified as amended by Act of June 2, 2003, 78th Leg., R.S., ch. 204, § 10.09, 2003 Tex. Gen. Laws 864, 884. Many of the provisions of former article 4590i have been recodified in the Civil Practice and Remedies Code. See Tex. Civ. Prac. & Rem.Code Ann. §§ 74.001-74.507 (Vernon Supp.2004-2005). However, a medical malpractice suit that was filed before September 1, 2003, such as the present case, is "governed by the law in effect immediately before” the changes in the law that were made by the Legislature. Act of June 2, 2003, 78th Leg., R.S., ch. 204, § 23.02(d), 2003 Tex. Gen. Laws 864, 899.

      .Act of May 5, 1995, 74th Leg., R.S., ch. 140, § 1, 1995 Tex. Gen. Laws 985, 985-87 (adding expert report requirement, at former Tex. Rev.Civ. Stat. art. 4590i, § 13.01(d)), repealed and recodified as amended by Act of June 2, 2003, 78th Leg., R.S., ch. 204, §§ 10.01, 10.09, and 23.02(a), (d), 2003 Tex. Gen. Laws 847, 864, 884, 898-99 (“House Bill 4”) (current version at Tex. Civ. Prac. & Rem.Code § 74.351 ("Expert Report”).

      . Id.

      . Act of May 30, 1977, 65th Leg., R.S., ch. 817, 1977 Tex. Gen. Laws 2039, 2041 (repealed 2003).

      . Act of May 5, 1995, 74th Leg., R.S., ch. 140, § 1, 1995 Tex. Gen. Laws 985, 986 (repealed 2003).

      . Id.

      . Id.

      . Id.

      .Act of May 30, 1977, 65th Leg., R.S., ch. 817, 1977 Tex. Gen. Laws 2039, 2050 (repealed 2003).

      . The opinion in Martin cited the plaintiff's pleading, in which she alleged that the defendants “were in complete control ... of all mechanical devices, including beds, operating tables, carts, and rooms.” Id. at 240 (emphasis added). The appellant plaintiff in Martin did not notice that her toe had been broken until the morning after her surgery; an operating table was thus not directly involved, as it was here.


source: Caselaw Access Project

author: Justice CARTER.

license: Public Domain

text:
    Joshua BARLOW, Appellant, v. The STATE of Texas, Appellee.
    No. 06-04-00138-CR.
    Court of Appeals of Texas, Texarkana.
    Submitted Aug. 15, 2005.
    Decided Aug. 31, 2005.
    Rehearing Overruled Oct. 25, 2005.

      Charles E. Friday, Texarkana, for appellant.
    Adam 0. Fellows, Asst. Dist. Atty., Nicole Habersang, Asst. Dist. Atty., Bowie County Dist. Atty’s Office, Texarkana, for state.
    Before MORRISS, C.J., ROSS and CARTER, JJ.
   OPINION

Opinion by

Justice CARTER.

Joshua Barlow was convicted by a jury for the offense of murder. The jury found the allegation in the enhancement paragraph to be true and assessed Barlow’s punishment at confinement for fifty years. The sufficiency of the evidence is not challenged.

On August 13, 2001, William Norris was shot and killed. The medical examiner determined the cause of death was a gunshot wound to the head. Analysis of the fragments on the bullet determined it was fired from a Ruger 9mm firearm that Clint Gilbreath had given to Barlow on the day of the murder. Gilbreath testified that Barlow asked to borrow the gun for protection. The gun was returned to Gil-breath later that same evening. The evidence showed that Barlow told Jason Dillinger and Denny Ward that he “blew that bitch’s brains out.” Barlow took Dillinger and Rob Miller to the scene of the murder, where Norris’ body was located.

Barlow presents two issues, which pertain to the same subject — that the trial court precluded Barlow from cross-examining or allowing Barlow to present extrinsic evidence that four State witnesses were affiliated with a gang and thus had a potential for bias in their testimony. We affirm the judgment of the trial court.

Issues

1. Did the trial court preclude Barlow from cross-examining witnesses concerning them gang affiliation and was that error?

To understand this issue, an explanation of the sequence of events is necessary. Before trial, Barlow moved to depose two State witnesses, Gilbreath and Ward. A pretrial hearing was conducted, at which time Barlow urged that these witnesses were accomplices. The trial court denied the motion to depose the witnesses, stating that the witnesses could invoke their Fifth Amendment rights. No issue is raised as to whether the court erred in denying the depositions.

After the jury was selected, but before presentation of evidence, the State presented a motion in limine to prevent Barlow from presenting character evidence in the form of alleged gang membership or affiliation by any witness. Barlow argued that such activity was intended to show that witnesses Gilbreath, Dillinger, Miller, and Ward were part of a conspiracy. The trial court granted the motion in limine, but stated, if the court was shown the proper authority, it would revisit the issue. The court further stated that the motion in limine simply meant the parties should approach the bench and conduct a hearing outside the presence of the jury.

The next morning, Barlow requested the court to reconsider its ruling. Barlow argued that “this is a Sixth Amendment issue.” Barlow argued that the testimony of these four witnesses and their actions had been to protect the organization and themselves. The court once again stated, “[W]e’re still at the limine stage. There’s no evidence before the Court at all to be able to consider.... Let’s get into the evidence and find out where it falls and see if something comes up that changes it.” Further, the court stated that it was satisfied with its ruling on the motion in limine and “[i]f I hear something different, you know, that may change.”

The State’s evidence was presented, including witnesses Gilbreath, Ward, Dillinger, and Miller. Barlow did not attempt to cross-examine any of the witnesses on the issue of gang affiliation or activity. Neither did Barlow request that a bill of exception be made outside the presence of the jury on those issues. Barlow did not attempt to proffer any testimony from any of the four witnesses. See Tex.R. Evm 103(a)(2). Barlow now complains he was prevented from cross-examining the witnesses by the rulings of the court.

We do not believe this issue has been preserved for appeal. The granting of a pretrial motion in limine does not preserve the error. For an error to be preserved with regard to the subject matter of a motion in limine, it is absolutely necessary that an objection be made at the time the subject is raised during trial. Wilkerson v. State, 881 S.W.2d 321, 326 (Tex.Crim.App.1994) (citing Gonzales v. State, 685 S.W.2d 47, 50 (Tex.Crim.App.1985)). Here, the court never ruled on the admissibility of cross-examination of the State’s witnesses concerning gang affiliation. The issue was never presented to the court after it granted the State’s motion in limine. The trial court stated on several occasions that the motion was an in limine motion only, that it did not have any evidence to consider, and that it would reconsider its rulings after hearing the evidence and if additional authorities were cited. The trial court was never presented with evidence to consider in determining whether cross-examination of these witnesses was proper and never excluded any proffered evidence. See Garcia v. State, 106 S.W.3d 854, 857 (Tex.App.-Houston [1st Dist.] 2003, pet. ref'd), cert. denied, 541 U.S. 1013, 124 S.Ct. 2076, 158 L.Ed.2d 626 (2004) (citing Wilkerson v. State, 881 S.W.2d 321, 326 (Tex.Crim.App.1994)) (a ruling granting a motion in limine does not preserve error on appeal); Wilson v. State, 44 S.W.3d 602, 606 (Tex.App.-Fort Worth 2001, pet. ref'd); McClelland v. State, No. 06-97-00018-CR, 1997 TexApp. LEXIS 5729 (TexApp.-Texarkana Oct. 31, 1997, no pet.) (not designated for publication). A ruling on a motion in limine that excludes evidence “is subject to reconsideration throughout trial” and in order “to preserve error an offer of the evidence must be made at trial.” Warner v. State, 969 S.W.2d 1, 2 (Tex.Crim.App.1998). The trial court did not commit error on this matter.

2. Did the court err in excluding the testimony of Jessica Vith concerning the gang affiliation of the witnesses?

At the close of the State’s testimony, Barlow presented, outside the presence of the jury, the testimony of Jessica Vith. She testified that she was familiar with Dillinger, Miller, Barlow, and Gilbreath and that “[t]hey were, at the time I was around, trying to get into the organization, the Aryan Circle.” She further testified that she accompanied Miller and Dillinger to a national meeting of the Aryan Circle and that Gilbreath was also present. She also thought Ward was a member. She further stated she observed the members tell untruths in order to protect the image of the organization (“They’ve lied for each other to family members, other friends outside of that. They’ve protected one another.”) This evidence was offered by Barlow “for the purposes of the record.” The trial court ruled that the evidence was inadmissible and that the probative value was outweighed by the prejudicial effect.

The evidence that a witness and the defendant are in the same gang has been held to bear on the witness’ veracity and bias. United States v. Abel, 469 U.S. 45, 48-49, 105 S.Ct. 465, 83 L.Ed.2d 450 (1984) (Mills, a witness, and respondent’s membership in the Aryan brotherhood support the inference that Mills’ testimony was slanted or perhaps fabricated in respondent’s favor.)

Some courts of appeals in Texas have also considered this issue. In McKnight v. State, 874 S.W.2d 745, 747 (Tex.App.-Fort Worth 1994, no pet.), the Fort Worth court stated:

In Abel, the Supreme Court held that the government could impeach a defense witness by showing that both the defendant and the witness were members of the Aryan Brotherhood, and that members were sworn to lie on behalf of each other. Abel, 105 S.Ct. at 465. Common membership of a witness and a party in an organization, even without proof that the witness or party has personally adopted its tenets, is probative of bias. Id, at 469. Therefore, evidence of McKnight’s and Anderson’s membership in the gang was properly admitted if it was admitted for the limited purpose of showing bias.

Id. Therefore, in certain situations, evidence of gang association may be relevant. Tex.R. Evid. 401.

However, the evidence proposed in this case has some significant factual differences. In all of the cases cited to us, the witness was impeached with evidence that the witness and the defendant had common membership in an association whose members were sworn to lie on behalf of each other and, therefore, the testimony would demonstrate a bias in the witness’ testimony on behalf of his fellow member. In this case, the rationale for evidence proposed was that the four testifying witnesses (Dillinger, Gilbreath, Miller, and Ward) were all members of a common gang, considered themselves brothers, and would lie for each other. However, the testimony also showed that Barlow was a member of the same gang. Utilizing this reasoning, Barlow also was a brother and, if the witnesses were biased by a common gang membership, Barlow would be one of the members that other members would try to protect — even if it meant lying. Here, their actions were completely to the contrary. The witnesses testified Barlow admitted and bragged that he had killed Norris. Logically, it cannot be argued that, if these witnesses were biased due to gang membership, they would lie for each other, but would abandon another fellow member, Barlow. The facts here contrast with cases in which a witness supported the position of a defendant fellow gang member on trial such as in McKnight (McKnight’s and Anderson’s membership in the gang was sufficiently probative of Anderson’s possible bias in favor of McKnight to warrant its admission into evidence).

We hold that, under these circumstances, this evidence of gang membership is not relevant. “ ‘Relevant evidence’ means evidence having any tendency to make the existence of any fact that is of consequence to the determination of the action more probable or less probable than it would be without the evidence.” Tex.R. Evid. 401. It cannot be said that this evidence would make it more or less probable that the witnesses were biased. On the one hand, it could be argued the witnesses would be biased on behalf of each other, but it is illogical that the same gang membership and beliefs would cause them to take a completely inconsistent position and not support another member, Barlow. The net result is that evidence of gang membership is not, in this instance, instructive concerning the bias of the witnesses. In determining whether evidence is relevant, courts look to the purpose for offering the evidence and whether there is a direct or logical connection between the offered evidence and the proposition to be proved. Pope v. State, 161 S.W.3d 114, 123 (Tex.App.-Fort Worth 2004, no pet.) (citing Reed v. State, 59 S.W.3d 278, 281 (Tex.App.-Fort Worth 2001, pet. ref'd)). The only purpose for allowing the gang membership testimony was to show bias. When the underpinning of the bias is removed, the testimony merely shows that these four witnesses were members of a gang — evidence which is highly prejudicial.

Even if the evidence has some relevance, Rule 403 mandates that a trial court determine if the “probative value is substantially outweighed by the danger of unfair prejudice.” Tex.R. Evid. 403. Evidence is unfairly prejudicial when it has “an undue tendency to suggest that a decision be made on an improper basis.” Reese v. State, 33 S.W.3d 238, 240 (Tex.Crim.App.2000). A Rule 403 analysis by the trial court should include, but is not limited to, the following factors: 1) how probative is the evidence, 2) the potential of the evidence to impress the jury in some irrational, but nevertheless indelible way, 3) the time the proponent needs to develop the evidence, and 4) the proponent’s need for the evidence. Id. at 240^41; Montgomery v. State, 810 S.W.2d 372, 389-90 (Tex.Crim.App.1990) (op. on reh’g).

In this case, the trial court indicated that the Rule 403 analysis excluded the testimony. In considering this ruling, we will address the factors that the Texas Court of Criminal Appeals has announced.

1)How probative is the evidence — -as is shown in our previous discussion, we believe that the evidence has little, if any, probative value. The only rationale for the introduction of evidence of gang affiliation of these four witnesses was to show their bias. In this instance, they testified against their own gang member. The probative value is extremely low. Further, the evidence was not clear that they were members of the Aryan Circle, but were “trying to get into the organization.”

2) The potential of the evidence to impress the jury in some irrational, but nevertheless indelible way — evidence of membership of the gang is highly prejudicial at the guilt/innocence stage. Galvez v. State, 962 S.W.2d 203, 206 (Tex.App.-Austin 1998, pet. refd) (“However, gang membership is highly inflammatory character evidence .... ”). It is normally admitted for punishment purposes. Anderson v. State, 901 S.W.2d 946 (Tex.Crim.App.1995). This factor would weigh heavily against admitting the evidence.

3) The time the proponent needs to develop the evidence — the time required to present the testimony is relatively brief and would not weigh against its admission.

4) The proponent’s need for the evidence — there was no similar evidence admitted and, therefore, this factor would favor admission of the evidence.

The trial court’s decision is reviewed for an abuse of discretion. The test for abuse of discretion is not whether, in the opinion of the reviewing court, the facts presented are an appropriate case for a trial court’s action. Rather, it is a question of whether the court acted without any reference to guiding rules or principles, and the mere fact that a trial court may decide a matter within its discretionary authority differently than an appellate court does not demonstrate such an abuse. Montgomery, 810 S.W.2d at 380. We will not reverse a trial court’s ruling on the admission of evidence as long as the ruling is within the zone of reasonable disagreement. Id. at 391.

We find that the trial court was within its discretion in denying the admission of the evidence. We affirm the judgment of the trial court.


author: FELIPE REYNA, Justice. TOM GRAY, Chief Justice,

text:
    Jane Anne BRYANT, Appellant, v. LUCENT TECHNOLOGIES, INC., Appellee.
    No. 10-03-00330-CV.
    Court of Appeals of Texas, Waco.
    Sept. 7, 2005.

      Brian P. Sanford, Emily M. Stout, Sheils Winubst Sanford & Bethune, Richardson, for appellant.
    Mark R. Steiner, Ashley Scheer, Jackson Walker LLP, Dallas, for appellee.
    Before Chief Justice GRAY, Justice VANCE, and Justice REYNA.
   OPINION

FELIPE REYNA, Justice.

Jane Anne Bryant filed suit against Lu-cent Technologies, Inc. for wrongful termination, breach of contract, intentional infliction of emotional distress, assault and battery, neghgent supervision, fraud, and defamation. The court granted Lucent’s motion for summary judgment on the assault and battery, neghgent supervision, fraud, and defamation claims and granted Lucent’s motion for directed verdict on the wrongful termination claim. A jury rendered a take-nothing verdict on the intentional infliction of emotional distress and breach of contract claims.

Bryant contends in four issues that the court erred by: (1) granting the directed verdict on her wrongful termination claim; (2) refusing to permit her counsel to argue that the alleged basis for her termination could be considered in deliberating on her intentional infliction of emotional distress claim; (3) granting Lucent’s summary judgment motion on the assault and battery claim; and (4) granting Lucent’s summary judgment motion on the defamation claim. We will affirm in part and reverse and remand in part.

Wrongful Termination

Bryant contends in her first issue that the court erred by granting Lucent’s motion for directed verdict on her wrongful termination claim because she presented some evidence that she was forced to resign because she refused to perform an illegal act.

Under Sabine Pilot Service, Inc. v. Hauck, an at-will employee may sue for wrongful termination if the sole reason for the termination was that the employee refused to perform an illegal act which would subject the employee to criminal liability. 687 S.W.2d 733, 735 (Tex.1985); see also Winters v. Houston Chronicle Publg. Co., 795 S.W.2d 723, 724 (Tex.1990); Laredo Med. Group Corp. v. Mireles, 155 S.W.3d 417, 420 (Tex.App.-San Antonio 2004, pet. denied).

A directed verdict for a defendant may be proper (1) when a plaintiff fails to present evidence raising a fact issue essential to the plaintiffs right of recovery, (2) when the defendant conclusively negates an element of the plaintiffs claim, or (3) when the defendant conclusively establishes a defense. See Prudential Ins. Co. of Am. v. Fin. Rev. Servs., Inc., 29 S.W.3d 74, 77-78 (Tex.2000); Democracy Coalition v. City of Austin, 141 S.W.3d 282, 288 (Tex.App.-Austin 2004, no pet.); Garcia v. Tenorio, 69 S.W.3d 309, 311 (Tex.App.-Fort Worth 2002, pet. denied). “In reviewing a directed verdict, we decide whether there is any evidence of probative value to raise an issue of material fact on the question presented. We examine the evidence in the light most favorable to the party suffering the adverse judgment.” Bostrom Seating, Inc. v. Crane Carrier Co., 140 S.W.3d 681, 684 (Tex.2004) (citations omitted).

Bryant contends that her supervisor instructed her to provide sales leads at no cost to certain dealers in violation of the Robinson-Patman Act. See 15 U.S.C.A. §§ 13, 13a (West 1997). However, Congress enacted the Robinson-Patman Act to prohibit price discrimination in transactions involving the sale of goods or commodities. See id. § 13(a) (“It shall be unlawful for any person engaged in commerce, in the course of such commerce, either directly or indirectly, to discriminate in price between different purchasers of commodities”); id. § 13a (unlawful to engage in transaction which discriminates against competitors with regard to “a sale of goods”); FTC v. Henry Broch & Co., 363 U.S. 166, 174, 80 S.Ct. 1158, 1163, 4 L.Ed.2d 1124 (1960); Innomed Labs, L.L.C. v. ALZA Corp., 368 F.3d 148, 156 (2d Cir.2004); Tri-State Broad. Co. v. United Press Intl., Inc., 369 F.2d 268, 269 (5th Cir.1966).

Here, Lucent is engaged in the business of telephone equipment sales. However, the controversy involving Bryant concerns the exchange of information between Lu-cent and other entities concerning potential purchasers of Lucent products. The essence of Bryant’s complaint is that her supervisor demanded that she provide this information (ie., “sales leads”) to some dealers at no cost while charging other dealers for the same information.

The provision of sales leads to dealers by Lucent does not constitute the sale of goods or commodities. Thus, the evidence conclusively negates an element of Bryant’s wrongful termination claim, namely, whether Bryant’s supervisor directed her to perform an act which would violate the Robinson-Patman Act. Accordingly, the court properly directed a verdict in favor of Lucent on Bryant’s wrongful termination claim. See Prudential Ins. Co., 29 S.W.3d at 77-78; Democracy Coalition, 141 S.W.3d at 288; Garcia, 69 S.W.3d at 311. Therefore, we overrule Bryant’s first issue.

Intentional Infliction of Emotional Distress

Bryant contends in her second issue that the court abused its discretion by refusing to permit her counsel to argue that the facts surrounding her termination could be considered in deliberating on her intentional infliction of emotional distress claim.

Closing argument should be limited to the evidence presented at trial and to the arguments of opposing counsel. Tex.R. Crv. P. 269(e); In re C.J.B., 137 S.W.3d 814, 826 (Tex.App.-Waco 2004, no pet.); Sanchez v. Espinoza, 60 S.W.3d 392, 395 (Tex.App.-Amarillo 2001, pet. denied). We review a trial court rulings on the scope of closing argument under an abuse-of-discretion standard. See C.J.B., 137 S.W.3d at 826; Sanchez, 60 S.W.3d at 395.

To recover for intentional infliction of emotional distress, a plaintiff must establish among other things that “the defendant’s conduct was extreme and outrageous.” Hoffmann-La Roche, Inc. v. Zeltwanger, 144 S.W.3d 438, 445 (Tex.2004). “[A] course of conduct should be evaluated as a whole to determine whether it was extreme and outrageous.” Tiller v. McLure, 121 S.W.3d 709, 715 (Tex.2003) (per curiam). Liability for intentional infliction of emotional distress is found when the defendant’s conduct is “so outrageous in character, and so extreme in degree, as to go beyond all possible bounds of decency, and to be regarded as atrocious, and utterly intolerable in a civilized community.” Creditwatch, Inc. v. Jackson, 157 S.W.3d 814, 817-18 (Tex.2005) (quoting Hoffmann-La Roche, 144 S.W.3d at 445).

White’s conduct should be evaluated as a whole in determining whether it was sufficiently extreme and outrageous. See Tiller, 121 S.W.3d at 715. Part of the evidence at issue is Bryant’s testimony that White forced her to resign because she refused to provide leads to some dealers at no cost while charging other dealers for the same information, conduct which she believed was violative of the Robinson-Patman Act.

The trial court advised Bryant’s counsel before closing argument that counsel could argue that Bryant and White disagreed about the application of the Robinson-Pat-man Act but could not argue that White forced her to resign because she refused to engage in conduct which she believed was violative of the Act.

Bryant’s testimony about her termination and the reasons for it is relevant evidence of whether White engaged in a course of conduct which was extreme and outrageous. Because this evidence is relevant, the court abused its discretion by refusing to permit Bryant’s counsel to discuss it in closing argument. See Tex.R. Civ. P. 269(e).

However, this error does not require reversal unless it “probably caused the rendition of an improper judgment.” Tex.R.App. P. 44.1(a)(1). Bryant argued that the totality of the circumstances shows that Lucent is liable for intentional infliction of emotional distress because: (1) Bryant was hired to direct Lucent’s marketing department without being told that she would be confronted with an entrenched bureaucracy, conflicting personalities, and insubordinate employees; (2) White did not support Bryant in her efforts to “clean up” the department; (3) an employee from another department was allowed to physically harass her; (4) White caused Bryant unnecessary worry by failing to adequately address her concerns about compliance with the Robinson-Pat-man Act; (5) White misled Bryant to believe that they were to have a meeting regarding the transfer of an employee in her department to another department, when in fact White intended to force Bryant to resign; and (6) Lucent erroneously identified Bryant in a payroll document as a marketing manager rather than a marketing director.

The trial court permitted Bryant’s counsel to argue that White and Bryant disagreed about compliance with the Robinson-Patman Act, that Bryant was concerned about violating the Act, and that White forced Bryant to resign. The only thing the court did not permit Bryant’s counsel to do was directly argue that White forced Bryant to resign because she refused to engage in conduct which she believed was violative of the Act.

Nevertheless, even if counsel had been permitted to draw a direct correlation between Bryant’s forced resignation and her dispute with White about marketing practices allowed under the Act, we would conclude that Bryant had failed as a matter of law to establish her claim for intentional infliction of emotional distress. Cf. Creditwatch, 157 S.W.3d at 816-18; Hoffmann-La Roche, 144 S.W.3d at 448-49. Therefore, we hold that the trial court’s erroneous restriction on Bryant’s closing argument did not result in the rendition of an improper judgment. See Tex.R.App. P. 44.1(a)(1).

Accordingly, we overrule Bryant’s second issue.

Assault and Battery

Bryant contends in her third issue that the court erred by granting Lucent’s summary judgment motion on her assault and battery claim because genuine issues of material fact remain on the question of whether her assailant was acting within the course and scope of his employment.

To hold an employer liable for the tortious acts of an employee, a plaintiff must show that the employee was acting (1) within the scope of the employee’s general authority, (2) in furtherance of the employer’s business, and (3) for the accomplishment of an objective for which the employee was hired. Buck v. Blum, 130 S.W.3d 285, 288 (Tex.App.-Houston [14th Dist.] 2004, no pet.); Wrenn v. G.A.T.X. Logistics, Inc., 73 S.W.3d 489, 493 (Tex.App.-Fort Worth 2002, no pet.). The commission of an intentional tort such as an assault is not generally considered to be within the scope of an employee’s authority. Tex. & P. Ry. Co. v. Hagenloh, 151 Tex. 191, 247 S.W.2d 236, 239 (1952); Buck, 130 S.W.3d at 288-89; Garrett v. Great W. Distribg. Co. of Amarillo, 129 S.W.3d 797, 800 (Tex. App.-Amarillo 2004, pet. denied); Wrenn, 73 S.W.3d at 494.

Therefore, to prove that an assault was committed within the scope of the employee assailant’s authority, a plaintiff must show that “the assault [wa]s committed to accomplish a duty entrusted to the employee.” Soto v. El Paso Nat. Gas Co., 942 S.W.2d 671, 681 (Tex.App.-El Paso 1997, writ denied); accord Tex. & P. Ry., 247 S.W.2d at 240; Garrett, 129 S.W.3d at 800.

Viewing the summary judgment evidence in the light most favorable to Bryant, we hold that Lucent conclusively established that Bryant’s assailant did not assault her to accomplish a duty entrusted to the assailant by Lucent. Cf. G.T. Mgt., Inc. v. Gonzalez, 106 S.W.3d 880, 884-85 (Tex.App.-Dallas 2003, no pet.) (bouncers authorized to use force to accomplish their assigned duties). Thus, the trial court properly granted Lucent’s summary judgment motion on Bryant’s claim for assault and battery. See Buck, 130 S.W.3d at 289-90; Garrett, 129 S.W.3d at 801-02; Wrenn, 73 S.W.3d at 494-95.

Accordingly, we overrule Bryant’s third issue.

Defamation

Bryant contends in her fourth issue that the court erred by granting Lu-cent’s summary judgment motion on her defamation claim because she produced some evidence that Lucent published a defamatory statement and Lucent failed to conclusively establish that the alleged defamatory statement was qualifiedly privileged.

Lucent argued in its summary judgment motion that it was entitled to judgment as a matter of law on Bryant’s defamation claim because Bryant could produce no evidence of publication.

Bryant responded to the summary judgment motion with an affidavit in which she stated, “Lucent has ... incorrectly identified me as a Marketing Manager rather than a Marketing Director to third parties.” (emphasis added). The court overruled Lucent’s objection that the paragraph with this statement “contains speculative and conclusory statements.” Lucent does not challenge this ruling on appeal.

Thus, Bryant produced more than a scintilla of evidence that Lucent mischar-acterized her position to third parties (i.e., that Lucent published this mischaracteri-zation to third parties). See Tex.R.App. P. 166a(i); Fort Worth Osteopathic Hosp., Inc. v. Reese, 148 S.W.3d 94, 99 (Tex.2004).

Lucent also argued in its summary judgment motion that it was entitled to judgment as a matter of law on Bryant’s defamation claim because Bryant could produce no evidence to defeat Lucent’s assertion of qualified privilege. However, qualified privilege is an affirmative defense. See Saudi v. Brieven, 176 S.W.3d 108, 117, No. 01-03-00865-CV, 2004 WL 2415659, at *7, 2004 Tex.App. LEXIS 9595 at *22 (Tex.App.-Houston [1st Dist.] Oct. 28, 2004, pet. denied); Gonzales v. Levy Strauss & Co., 70 S.W.3d 278, 282-83 (Tex.App.-San Antonio 2002, no pet.). Thus, Lu-cent bore the burden to conclusively establish each element of the privilege to prevail on its summary judgment motion. Id.

To establish the affirmative defense of qualified privilege, a defendant must show that the alleged defamatory statement: (1) was made without malice; (2) concerned a subject matter of sufficient interest to the author or was in reference to a duty owed by the author; and (3) was communicated to another party with a corresponding interest or duty. See Saudi, at 117, 2004 WL 2415659, at *6, 2004 Tex. App. LEXIS 9595 at *20-21; Austin v. Inet Techs., Inc., 118 S.W.3d 491, 496 (Tex.App.-Dallas 2003, no pet.); San Antonio Credit Union v. O’Connor, 115 S.W.3d 82, 99 (Tex.App.-San Antonio 2003, pet. denied).

Lucent offered no summary judgment evidence to prove its affirmative defense. Rather, its summary judgment motion erroneously suggested that Bryant bore the burden of proving actual malice to defeat Lucent’s affirmative defense. Therefore, the court erred by granting Lucent’s summary judgment motion on Bryant’s defamation claim.

Accordingly, we sustain Bryant’s fourth issue.

Costs

Rule of Appellate Procedure 43.4 directs an appellate court to “award to the prevailing party the appellate costs — including preparation costs for the clerk’s record and the reporter’s record — that were incurred by that party” unless there is “good cause” to do otherwise. Because Bryant has prevailed on one of her claims on appeal, we conclude that she is entitled to recover appellate costs.

Rule of Civil Procedure 139 directs the manner in which trial court (and appellate court) costs are to be awarded on appeal.

When a case is appealed, if the judgment of the higher court be against the appellant, but for less amount than the original judgment, such party shall recover the costs of the higher court but shall be adjudged to pay the costs of the court below; if the judgment be against him for the same or a greater amount than in the court below, the adverse party shall recover the costs of both courts. If the judgment of the court above be in favor of the party appealing and for more than the original judgment, such party shall recover the costs of both courts; if the judgment be in his favor, but for the same or a less amount than in the court below, he shall recover the costs of the court below, and pay the costs of the court above.

Tex.R. Civ. P. 139. Rule 141 then provides (as Rule 43.4) that we may award costs otherwise “for good cause.” Id. 141.

Here, Bryant prevailed on only one of the four substantive claims she raised on appeal. Accordingly, we award Bryant only twenty-five percent of the trial court costs and assess seventy-five percent of the trial court costs against her.

Conclusion

We affirm the judgment as to Bryant’s claims for wrongful termination, intentional infliction of emotional distress, and assault and battery. We reverse the judgment as to Bryant’s defamation claim and remand this cause to the trial court for further proceedings consistent with this opinion.

Chief Justice GRAY dissenting.

TOM GRAY, Chief Justice,

dissenting.

Conclusory statements in support of a motion for summary judgment are no evidence. See Texas Division-Tranter v. Carrozza, 876 S.W.2d 312, 314 (Tex.1994); Brownlee v. Brownlee, 665 S.W.2d 111, 112 (Tex.1984). If something is no evidence, it does not turn into evidence because there was no objection to it or complaint raised about it. An objection is only required to complain about improperly admitted or excluded evidence. The conclusory statement in Bryant’s affidavit cited by the majority is no evidence of publication of a defamatory statement.

The trial court’s judgment should be affirmed in all respects and all costs assessed against Bryant. Because the majority does not, I respectfully dissent.

      . The elements for intentional infliction of emotional distress are: "(1) the defendant acted intentionally or recklessly; (2) the defendant’s conduct was extreme and outrageous; (3) the defendant’s actions caused the plaintiff emotional distress; and (4) the resulting emotional distress was severe.” Hoffmann-La Roche, Inc. v. Zeltwanger, 144 S.W.3d 438, 445 (Tex.2004).

      . This quotation originates with the Restatement (Second) of Torts. See Hoffmann-La Roche, 144 S.W.3d at 445 (quoting Twyman v. Twyman, 855 S.W.2d 619, 621 (Tex.1993) (quoting Restatement (Second) of Torts § 46 cmt. d (1965))).

      . Because Bryant does not challenge the court’s take-nothing judgment on her remaining claims (breach of contract, negligent supervision, and fraud), we leave that portion of the judgment undisturbed. See Pat Baker Co. v. Wilson, 971 S.W.2d 447, 450-51 (Tex.1998) (per curiam); Builders Transport, Inc. v. Grice-Smith, 167 S.W.3d 1, 15 (Tex.App.Waco), modified, 167 S.W.3d 18 (Tex.App.Waco 2005, pet. filed).


author: FELIPE REYNA, Justice.

text:
    Volney LaFayette ALSTON, IV, Appellant, v. The STATE of Texas, Appellee.
    No. 10-03-00282-CR.
    Court of Appeals of Texas, Waco.
    Sept. 21, 2005.
    Rehearing Overruled Nov. 8, 2005.

      Hoagie L. Karels, Marlin, for appellant.
    Kathryn J. Gilliam, Falls County Dist. Atty., Marlin, for appellee.
    Before Chief Justice GRAY, Justice VANCE, and Justice REYNA.
   OPINION

FELIPE REYNA, Justice.

A jury convicted Volney Lafayette Alston, IV of theft by a public servant of property valued at $50 or more but less than $500. The court sentenced him to sixty days’ confinement and a $1,000 fine. Alston contends in four issues that: (1) the court erred by amending the information on the day of trial over his objection; (2) the court erred by amending the complaint on the day of trial over his objection; (3) the evidence is legally insufficient under the original information; and (4) the evidence is factually insufficient under the original information. We will affirm.

As originally filed, the complaint and information alleged in pertinent part that Alston unlawfully appropriated property from the “Marlin Volunteer Fire Department” while he was “a fireman with the Marlin Volunteer Fire Department.” At the commencement of trial, the State asked the court to strike the word ‘Volunteer” in these two phrases from both the complaint and information. The court did so over Alston’s objection.

Alston contends in his first and second issues respectively that the court erred by striking the word ‘Volunteer” from the information and complaint because this amounted to an improper amendment of these documents. The State responds that this was an appropriate abandonment of “surplusage.”

A matter of form or substance in an indictment or information may not be amended over the defendant’s objection without permitting the defendant an additional ten days to prepare. See Tex.Code Crim. PROC. Ann. art. 28.10 (Vernon 1989). However, allegations may be abandoned from an indictment or information without giving the defendant additional time to prepare.

The abandonment of allegations in an indictment or information is appropriate when it: (1) abandons one or more alternative means of committing the offense; (2) reduces the charged offense to a lesser included offense; or (3) eliminates surplusage. Eastep v. State, 941 S.W.2d 130, 135 (Tex.Crim.App.1997), overruled on other grounds by Riney v. State, 28 S.W.3d 561 (Tex.Crim.App.2000); Mayfield v. State, 117 S.W.3d 475, 476 (Tex.App.-Texarkana 2003, pet. ref'd); Hardie v. State, 79 S.W.3d 625, 632 n. 1 (Tex.App.Waco 2002, pet. refd). Surplusage includes “allegations not essential to constitute the offense.” Curry v. State, 30 S.W.3d 394, 399 (Tex.Crim.App.2000) (quoting Burrell v. State, 526 S.W.2d 799, 802 (Tex.Crim.App.1975)).

An exception to this definition of surplusage has been recognized which provides that when an unnecessary allegation “is descriptive of that which is legally essential to charge a crime, the State must prove it as alleged though needlessly pleaded.” See Eastep, 941 S.W.2d at 134 n. 7; accord Curry, 30 S.W.3d at 399. Thus, it was held that “when an indictment describes a necessary person, place, or thing with unnecessary particularity, the State must prove all circumstances of the description.” Eastep, 941 S.W.2d at 134 n. 7 (citing Burrell, 526 S.W.2d at 802). The focus of this exception was on whether the allegation at issue described an element of the offense with more particularity than necessary. See Curry, 30 S.W.3d at 399. The Court of Criminal Appeals has identified this as “the Burrell exception.” See Gollihar v. State, 46 S.W.3d 243, 250 (Tex.Crim.App.2001).

Alston argues that the Bmrell exception applies here and thus the State could not abandon the term “Volunteer” from the allegations of the complaint and information. However, the Court of Criminal Appeals has expressly overruled the Burrell exception. Id. at 256; see also Santana v. State, 59 S.W.3d 187, 195 (Tex.Crim.App.2001). Therefore, if the term “Volunteer” was “not essential to constitute the offense” with which Alston was charged, then the striking of this term was a permissible abandonment.

The name of the agency from which Alston stole the property in question and the name of the agency by which he was employed were “not essential to constitute the offense” because they were not elements of the offense. See Fuller v. State, 73 S.W.3d 250, 254 (Tex.Crim.App.2002); Gollihar, 46 S.W.3d at 258. Thus, these allegations were surplusage and were properly abandoned. See Eastep, 941 S.W.2d at 135; Mayfield, 117 S.W.3d at 476; Hardie, 79 S.W.3d at 632 n. 1. Accordingly, we overrule Alston’s first two issues.

Alston contends in his third and fourth issues that the evidence is legally and factually insufficient because the State failed to prove the offense as alleged in the original complaint and information.

These issues depend on favorable findings on Alston’s first and second issues. However, we have determined that the State properly abandoned the allegations that Alston was a firefighter with the ‘Volunteer” fire department and stole property from that department. The State presented evidence that Alston was a firefighter with the Marlin Fire Department and that he stole property belonging to the Marlin Fire Department. Thus, the evidence is legally and factually sufficient. Accordingly, we overrule Alston’s third and fourth issues.

We affirm the judgment.

      . Actually, Alston’s second issue reads, "The Trial Court erred in amending the sworn complaint by striking the word ‘Volunteer’ and thus causing the complaint to no longer state facts which were sworn to by the complainant.” Although Alston raised the issue of the propriety of altering a sworn document in the trial court, the argument portion of his brief cites no authorities and makes no argument regarding this issue. Thus, we construe his second issue as a challenge to the court's alteration of the complaint for the same reasons he challenges the alteration of the information in his first issue, which is grouped together with the second issue in his brief. We do not reach the question of whether it is proper for a trial court to physically alter a sworn complaint. Cf. Huynh v. State, 901 S.W.2d 480, 481-82 (Tex.Crim.App.1995); Hess v. State, 953 S.W.2d 837, 840 (Tex.App.Fort Worth 1997, pet. ref'd).


author: Justice B.A. SMITH. PEMBERTON, J.,

text:
    HOME INTERIORS & GIFTS, INC., Appellant, v. Carole Keeton STRAYHORN, Comptroller of Public Accounts of the State of Texas, and Greg Abbott, Attorney General of the State of Texas, Appellees.
    No. 03-04-00660-CV.
    Court of Appeals of Texas, Austin.
    Sept. 22, 2005.
    Concurring Opinion by Justice Pemberton July 28, 2005.

      B. Jason Forshee, Daniel L. Butcher, Farley P. Katz, Strasburger & Price, LLP, Dallas, Walter Hellerstein, Sutherland, As-bill & Brennan, LLP, Washington, DC, for appellant.
    Christine Monzingo, Jeffrey L. Mullins, Austin, for appellees.
    Before Chief Justice LAW, Justices B.A. SMITH and PEMBERTON.
   OPINION

Opinion by

Justice B.A. SMITH.

On August 9, 2005, appellant, Home Interiors & Gifts, Inc., filed an unopposed motion for rehearing seeking a modification of our opinion and judgment issued on July 28, 2005. Additionally, on August 15, 2005, the appellees, the Comptroller and the Attorney General, filed a motion for rehearing. We grant the appellant’s unopposed motion and overrule the appellees’ motion. Accordingly, our opinion and judgment issued on July 28, 2005, are withdrawn, and the following opinion is substituted.

In this case, we determine whether the earned surplus throwback provision of the Texas franchise tax as applied to appellant, Home Interiors & Gifts, Inc. (Home Interiors), unconstitutionally burdens interstate commerce. Home Interiors is seeking a refund of franchise taxes timely paid to appellee, Carole Keeton Strayhorn (the Comptroller). Both parties filed motions for summary judgment. The district court denied Home Interiors’ motion and granted the Comptroller’s motion. On appeal, Home Interiors argues that the application of the earned surplus throwback provision causes the franchise tax to (1) be unfairly apportioned, (2) discriminate against interstate commerce, and (3) be unfairly related to services provided by Texas. Because we hold that the franchise tax as applied to Home Interiors lacks internal consistency and, consequently, is unfairly apportioned, we reverse the district court’s grant of summary judgment in favor of the Comptroller and render judgment that the tax is unconstitutional as applied to Home Interiors.

BACKGROUND

Home Interiors

Home Interiors is a Texas corporation that employs approximately 350 employees in Texas. Virtually all its operations occur in Texas — it has no manufacturing, warehousing, or administrative facilities outside of this state. It is in the business of purchasing home decor products, accessories, and gifts and wholesaling them to independent contractors, known as “Dis-players.” Additionally, Home Interiors sells a variety of marketing materials to the Displayers to aid in the retail sale of the products. All of Home Interiors’ profits are generated from the initial sale of the products to the Displayers. During the period of time relevant to this appeal, Home Interiors sold products to Display-ers located in all fifty states, Washington D.C., and Puerto Rico.

The Displayers generate sales by hosting promotional parties where they provide samples and demonstrate various products. They also distribute catalogs and recruit new salesmen. Essentially, the Displayers function as a retail outlet for Home Interiors’ wares. However, the Displayers are not employed by Home Interiors. Home Interiors does not compensate the Displayers and does not provide them benefits of any kind. It does, however, pay the Displayers a commission on sales generated by a newly recruited salesperson. Additionally, Home Interiors has no contact with any of the Displayers’ retail customers and does not install or repair products outside of Texas.

Between 1994 and 1999, Home Interiors timely paid its Texas franchise taxes. It now seeks a refund of those taxes, contending that the statutory method for apportioning the earned surplus component of the franchise tax is unconstitutional. After refund hearings were held, the Comptroller issued a decision in July 2003 stating that she did not have the authority to rule on the constitutionality of the statutory provisions. Consequently, Home Interiors brought suit in district court, which upheld the constitutionality of the earned surplus throwback provision.

Texas Franchise Tax

The franchise tax is imposed on corporations in Texas for the privilege of doing business here. See Tex. Tax Code Ann. § 171.001(a)(1) (West Supp.2004-05); Anderson-Clayton Bros. Funeral Home, Inc. v. Strayhorn, 149 S.W.3d 166, 169 (Tex.App.-Austin 2004, pet. filed); Rylander v. Fisher Controls Int’l, Inc., 45 S.W.3d 291, 293 (Tex.App.-Austin 2001, no pet.). Before January 1, 1992, the franchise tax was assessed solely on a corporation’s taxable capital. Anderson-Clayton Bros., 149 S.W.3d at 169. The result was that capital-intensive industries bore the brunt of the tax. Id. In an effort to broaden the franchise tax base, the legislature added an alternative assessment on a corporation’s “net taxable earned surplus.” Id. Presently, the tax is calculated by adding the tax on net taxable capital to the difference between the tax on net taxable earned surplus and the tax on net taxable capital. See Tex. Tax Code Ann. § 171.002(b) (West 2002); INOVA Diagnostics, Inc. v. Strayhorn, 166 S.W.3d 394, 398 (Tex.App.-Austin, pet.filed). Despite this awkward formula, the practical effect is to assess the greater of a 4.5 percent tax on net taxable earned surplus or a .25 percent tax on net taxable capital. See INOVA, 166 S.W.3d at 398.

A corporation’s net taxable capital consists of its stated capital and its surplus. Fisher Controls Int’l, 45 S.W.3d at 293. Its net taxable earned surplus is comprised of its reportable taxable income (for federal income-tax purposes) plus certain other sums and less other amounts. Id. at 294. A corporation’s net taxable capital or net taxable earned surplus is apportioned to the state by dividing the corporation’s gross receipts generated in Texas by the corporation’s total worldwide gross receipts. See Tex. Tax Code Ann. § 171.106 (West Supp.2004-05); General Dynamics Corp. v. Sharp, 919 S.W.2d 861, 863 (Tex.App.-Austin 1996, writ denied). In addition, a corporation’s gross receipts from each sale of tangible personal property shipped from Texas to a purchaser in another state are “thrown back” to Texas and added to the gross receipts from business done in Texas. Tex. Tax Code Ann. §§ 171.103(1) (West 2002), .1032(a)(1) (West Supp.2004-05). Gross receipts used to apportion net taxable capital are only thrown back if the corporation is not subject to taxation in the purchaser’s state. Id. § 171.103(1) (taxable capital throwback provision). Importantly, gross receipts used to apportion net taxable earned surplus are thrown back if the corporation “is not subject to any tax on, or measured by, net income, without regard to whether the tax is imposed.” Id. § 171.1032(a)(1) (earned surplus throwback provision).

The purpose of the earned surplus throwback provision is to capture and tax income generated from sales in other states that would otherwise go untaxed as a result of Public Law 86-272. See id.; cf INOVA, 166 S.W.3d at 397 (explaining purpose of Public Law 86-272). Congress enacted Public Law 86-272 in 1959 in response to a United States Supreme Court decision that indicated that the federal constitution does not prohibit individual states from imposing an income tax on out-of-state corporations, even when their only business activity in the state is solicitation of purchases. 15 U.S.C. § 381(a) (West 1997); see Wisconsin Dep’t of Revenue v. William Wrigley, Jr. Co., 505 U.S. 214, 220-21, 112 S.Ct. 2447, 120 L.Ed.2d 174 (1992) (discussing opinion in Northwestern States Portland Cement Co. v. Minnesota, 358 U.S. 450, 452, 79 S.Ct. 357, 3 L.Ed.2d 421 (1959)). Less than a year after the Northwestern States Portland Cement opinion, Public Law 86-272 was passed to create minimum standards for business activity required within a state before that state may impose state income tax on an out-of-state corporation. See William Wrigley, Jr. Co., 505 U.S. at 223, 112 S.Ct. 2447. Specifically, the statute prohibits a state from imposing a net income tax if the foreign taxpayer’s only business activity in the state is the solicitation of orders. See 15 U.S.C. § 381(a). A net income tax is “any tax imposed on, or measured by, net income.” Id. § 383.

All parties in this case concede that Public Law 86-272 protects Home Interiors from being taxed on income generated from sales of its products to Displayers located in most states. Consequently, the gross receipts from sales to Displayers in those states were thrown back to Texas and added to Home Interiors’ receipts from business done in Texas. Home Interiors claims that the inclusion of the thrown back receipts is significant because, during the time period at issue here, approximately ninety percent of its revenues were generated from sales outside of Texas. Accordingly, Home Interiors contends that the application of the earned surplus throwback provision results in an unfairly apportioned franchise tax assessment.

STANDARD OF REVIEW

We review the trial court’s summary judgment de novo. Provident Life & Accident Ins. Co. v. Knott, 128 S.W.3d 211, 215 (Tex.2003); Texas Dep’t of Ins. v. American Home Assurance Co., 998 S.W.2d 344, 347 (Tex.App.-Austin 1999, no pet.). When parties file cross-motions for summary judgment, each party in support of its motion necessarily takes the position that there is no genuine issue of fact in the case and that it is entitled to judgment as a matter of law. City of Pflugerville v. Capital Metro. Transp. Auth., 123 S.W.3d 106, 110 (Tex.App.-Austin 2003, pet. denied). Thus, when both parties file a motion for summary judgment, we determine all questions presented and render such judgment as the trial court should have rendered. See Commissioners Court v. Agan, 940 S.W.2d 77, 81 (Tex.1997).

In order to determine the judgment that the trial court should have rendered, we must construe the Texas franchise tax statute. In construing a statute, “our objective is to determine and give effect to the Legislature’s intent.” National Liab. & Fire Ins. Co. v. Allen, 15 S.W.3d 525, 527 (Tex.2000); see Albertson’s, Inc. v. Sinclair, 984 S.W.2d 958, 960 (Tex.1999). Statutory construction is a question of law for the court to decide. See Texas Dep’t of Transp. v. Needham, 82 S.W.3d 314, 318 (Tex.2002).

DISCUSSION

Home Interiors argues that the application of the earned surplus throwback provision causes the franchise tax to unconstitutionally burden interstate commerce because it results in an assessment that (1) is unfairly apportioned, (2) discriminates against interstate commerce, and (3) unfairly relates to services provided by Texas. Before directly considering Home Interiors’ claim, a brief review of Commerce Clause jurisprudence is beneficial.

Commerce Clause

The Commerce Clause of the Constitution expressly grants Congress the power “[t]o regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes.” U.S. Const., art. I, § 8, cl. 3. In addition to this express grant of authority, the Supreme Court has held that the Commerce Clause also prohibits certain state regulation of interstate commercial activity even when Congress has failed to legislate on the subject. Oklahoma Tax Comm’n v. Jefferson Lines, Inc., 514 U.S. 175, 179-80, 115 S.Ct. 1331, 131 L.Ed.2d 261 (1995); Quill Corp. v. North Dakota, 504 U.S. 298, 309, 112 S.Ct. 1904, 119 L.Ed.2d 91 (1992). This implicit principle is known as the “Dormant” or “Negative” Commerce Clause. While in theory the concept of the Dormant Commerce Clause is relatively simple to understand, its application to the practical realities of interstate commerce has proved quite difficult.

Initially, the Supreme Court held that interstate commerce was wholly immune from state taxation. Jefferson Lines, 514 U.S. at 180, 115 S.Ct. 1331. Although there were minor deviations, the Court maintained this formalistic and mechanical approach to state taxation of interstate commerce until the late 1930s. In 1938, the Court moved away from its traditional “free trade” approach to the Commerce Clause. In Western Live Stock v. Bureau of Revenue, 303 U.S. 250, 252, 58 S.Ct. 546, 82 L.Ed. 823 (1938), the Court was asked to determine whether a New Mexico tax on the privilege of engaging in specified business activities violated the Commerce Clause. The taxpayer was an instate magazine publisher and the tax involved was measured by gross receipts from the sale of advertising in the magazine. Western Live Stock, 303 U.S. at 252, 58 S.Ct. 546. The magazine publisher argued that the revenue generated from the sale of ad space to out-of-state advertisers was immune from taxation because the contracts were a form of interstate commerce. Id. at 253, 58 S.Ct. 546. The Court sustained the tax and stated, “It was not the purpose of the Commerce Clause to relieve those engaged in interstate commerce from their just share of state tax burden even though it increases the cost of doing business.” Id. at 254, 58 S.Ct. 546. The Court explained that the tax did not present the risk of double taxation:

So far as the value contributed to appellants’ New Mexico business by circulation of the magazine interstate is taxed, it cannot again be taxed elsewhere any more than the value of railroad property taxed locally. The tax is not one which in form or substance can be repeated by other states in such manner as to lay an added burden on the interstate distribution of the magazine.

Id. at 260, 58 S.Ct. 546. Shortly after Western Live Stock, the Court further developed this rationale by invalidating an unapportioned gross receipts tax on the ground that interstate commerce would be subjected to the risk of a double tax burden not similarly imposed on intrastate commerce:

The vice of the statute as applied to receipts from interstate sales is that the tax includes in its measure, without apportionment, receipts derived from activities in interstate commerce; and that the exaction is of such a character that if lawful it may in substance be laid to the fullest extent by States in which the goods are sold as well as those in which they are manufactured.

J.D. Adams Mfg. Co. v. Storen, 304 U.S. 307, 311, 58 S.Ct. 913, 82 L.Ed. 1365 (1938).

The multiple taxation doctrine set forth in Western Live Stock was not fully embraced by the Court and was temporarily repudiated in 1946. See Freeman v. Hewit, 329 U.S. 249, 67 S.Ct. 274, 91 L.Ed. 265 (1946); see also J. Hellerstein & W. Hellerstein, State Taxation ¶ 4.09 (3d ed.2004) (hereinafter Hellerstein & Hellerstein). In Spector Motor Serv., Inc. v. O’Connor, 340 U.S. 602, 607-10, 71 S.Ct. 508, 95 L.Ed. 573 (1951), the Court held that a state is precluded from taxing the privilege of doing an exclusively interstate business, even by means of a nondiscriminatory, fairly apportioned net income tax. See Hellerstein & Hellerstein, ¶ 4.09.

In Northwestern States Portland Cement Co. v. Minnesota, the Court attempted to clear up “the tangled underbrush of past cases” by outlining the aspects of its Commerce Clause jurisprudence that remained in full force. See 358 U.S. 450, 457-58, 79 S.Ct. 357, 3 L.Ed.2d 421 (1959). After distinguishing Spector on the ground that it only involved a tax on the privilege of doing business, although measured by net income, the Court held that there is no constitutional barrier to the imposition of a nondiscriminatory, fairly apportioned direct net income tax on a foreign corporation carrying on an exclusively interstate business within the taxing state. Id. at 458-60, 79 S.Ct. 357; see also Hellerstein & Hellerstein, ¶ 4.10. After Northwestern States many states replaced franchise taxes levied solely on the privilege of doing business in the state with direct net income taxes. See Hellerstein & Heller-stein, ¶ 4.10.

In 1977, the Court overruled Spec-tor. See Complete Auto Transit, Inc. v. Brady, 430 U.S. 274, 288, 97 S.Ct. 1076, 51 L.Ed.2d 326 (1977). The Court stated that “the Spector rule does not address the problems with which the Commerce Clause is concerned. Accordingly, we now reject the rule of Spector Motor Service, Inc. v. O’Connor, that a state tax on the ‘privilege of doing business’ is per se unconstitutional when it is applied to interstate commerce.” Complete Auto, 430 U.S. at 288-89, 97 S.Ct. 1076. In reaching this conclusion, the Court noted that many of its post-Western Live Stock opinions considered the practical effect of a state tax rather than the formal language of the tax statute. Id. at 279, 97 S.Ct. 1076. Furthermore, the Court articulated what has come to be known as the Complete Auto doctrine. Id. Essentially, the Court declared that a tax will survive Commerce Clause scrutiny “when the tax is applied to an activity with a substantial nexus with the taxing State, is fairly apportioned, does not discriminate against interstate commerce, and is fairly related to the services provided by the State.” Id. The four-pronged Complete Auto test continues to guide Commerce Clause analysis today. See, e.g., American Trucking Ass’ns, Inc. v. Michigan Pub. Serv. Comm’n, — U.S. -, 125 S.Ct. 2419, 2426, 162 L.Ed.2d 407 (2005).

Home Interiors now avers that, as applied to it, the application of the earned surplus throwback provision causes the franchise tax to fail the Complete Auto test.

Substantial Nexus

The first prong of the Complete Auto test asks whether Home Interiors’ activities have a substantial nexus with the state justifying the application of the franchise tax. Both parties agree that Home Interiors’ activities within the state are sufficient to constitute a substantial nexus.

Fair Apportionment

The more difficult question is whether the application of the earned surplus throwback provision to Home Interiors results in an unfair apportionment of franchise-tax liability under the second prong of the Complete Auto test. The fair apportionment requirement attempts to ensure that no State taxes more than its fair share of an interstate transaction. Jefferson Lines, 514 U.S. at 184, 115 S.Ct. 1331; Goldberg v. Sweet, 488 U.S. 252, 260-61, 109 S.Ct. 582, 102 L.Ed.2d 607 (1989). “This principle of fair share is the lineal descendant of Western Live Stock’s prohibition of multiple taxation, which is threatened whenever one State’s act of overreaching combines with the possibility that another State will claim its fair share of the value taxed.” Jefferson Lines, 514 U.S. at 184, 115 S.Ct. 1331. In order to determine whether a tax is fairly apportioned, we first ask whether it is “internally consistent,” and if so, whether it is also “externally consistent.” Id. at 185, 115 S.Ct. 1331; Goldberg, 488 U.S. at 261, 109 S.Ct. 582.

The internal consistency test requires us to imagine a hypothetical scenario assuming that every state imposes a tax identical to the one at issue. Jefferson Lines, 514 U.S. at 185, 115 S.Ct. 1331. In this hypothetical, if interstate commerce bears a burden that is not also borne by intrastate commerce, then the tax is not internally consistent. Id. “The test asks nothing about the degree of economic reality reflected by the tax.” Id. The test is merely a tool used to determine whether, as a matter of law, a State is attempting to tax more than its fair share of interstate transactions. Id.

Although the Supreme Court and various state courts have applied the internal consistency test on a number of occasions, the two most significant and analogous examples are Armco, Inc. v. Hardesty, 467 U.S. 638, 104 S.Ct. 2620, 81 L.Ed.2d 540 (1984), and Tyler Pipe Industries, Inc. v. Washington Dep’t of Revenue, 483 U.S. 232, 107 S.Ct. 2810, 97 L.Ed.2d 199 (1987). In Armco, the Court determined that West Virginia’s business and occupation tax (B & O tax) was internally inconsistent. Armco, 467 U.S. at 642-46, 104 S.Ct. 2620. The B & O tax had two components, a tax on wholesaling and a tax on manufacturing. Id. at 640-41, 104 S.Ct. 2620. In general, a taxpayer engaged in both wholesaling and manufacturing would be liable for taxes on both activities. Id. However, there was a “multiple activities” exemption that relieved instate manufacturers who also wholesaled their products in the state from liability for the wholesale tax. Id.; see Hellerstein & Hellerstein, ¶ 4.15. The result was that an instate manufacturer/wholesaler only paid the manufacturing tax, but an out-of-state manufacturer who made wholesale sales in West Virginia paid the wholesale tax, even if it paid a manufacturing tax in another state.

An Ohio corporation challenged West Virgina’s B & O tax scheme, claiming that it was facially discriminatory and that it unconstitutionally discriminated against interstate commerce. Armco, 467 U.S. at 639-40, 104 S.Ct. 2620. The Court agreed, concluding that the multiple activities exemption caused the B & O tax to be internally inconsistent. Id. at 642-46, 104 S.Ct. 2620. The Court explained that, if every state adopted an identical B & O tax scheme, corporations that manufactured products in one state and made wholesale sales in another state would be subject to .manufacturing taxes in the state of production and wholesale taxes in the state of sale. Id. However, a corporation that both manufactured and made wholesale sales in the same state would never be subject to the wholesale tax. Id. Significantly, in response to the argument that an instate manufacturer/wholesaler paid more taxes than an out-of-state manufacturer as a result of the higher tax rate on manufacturing, the Court held that a showing of actual discriminatory impact was unnecessary. Id. at 644-45, 104 S.Ct. 2620.

In Tyler Pipe, the Court addressed Washington state’s B & O tax scheme, which was nearly identical to the one struck down in Armco. Tyler Pipe, 483 U.S. at 234, 107 S.Ct. 2810. The only difference was that the Washington tax exempted instate manufacturer/wholesalers from the manufacturing tax as opposed to the wholesale tax. Id. at 236-37, 107 S.Ct. 2810. As a result, Washington’s tax was not facially discriminatory because both instate manufacturer/wholesalers, who benefitted from the exemption, and out-of-st'ate manufacturers, who made wholesale sales in Washington, were liable for the wholesale tax. Id. at 239, 107 S.Ct. 2810. Nevertheless, the Court concluded that the reasons for invalidating the West Virginia tax equally applied to the Washington tax. Id. at 234, 107 S.Ct. 2810. Like Armco, if every state hypothetically imposed Washington’s B & O tax scheme, then corporations that manufactured in one state and sold wholesale in another would ultimately be liable for both the manufacturing and the wholesale tax, while the instate manufacturer/wholesaler would never be liable for the manufacturing tax. Again, the Court held that the Washington tax scheme was not internally consistent. Id. at 248, 107 S.Ct. 2810.

There are a number of lessons we can learn from Armco and Tyler Pipe regarding internal consistency. First, a tax may be internally inconsistent even if a corporation doing intrastate business pays more than a corporation doing interstate business. See id. at 240-41, 107 S.Ct. 2810; see also Armco, 467 U.S. at 642-46, 104 S.Ct. 2620. This was the case in Arm-co where the intrastate corporation actually paid more tax, but the B & O tax scheme was still held to be internally inconsistent because the interstate corporation was subject to a separate tax under the scheme that the intrastate corporation was not. Second, the internal consistency test does not require a showing of either actual discrimination or actual multiple taxation; the test is purely hypothetical. See Tyler Pipe, 483 U.S. at 242-47, 107 S.Ct. 2810. Finally, a tax that is internally inconsistent, and therefore unfairly apportioned, discriminates against interstate commerce. Id. at 247, 107 S.Ct. 2810.

Home Interiors argues that the interplay between Public Law 86-272 and the Texas earned surplus throwback provision causes the franchise tax to be internally inconsistent as applied to it. To determine if Home Interiors’ argument is valid, our first step is to imagine a situation in which every state imposes an integrated franchise tax, identical to the Texas tax, in which a corporation’s liability is the greater of a 4.5 percent tax on net taxable earned surplus or a .25 percent tax on net taxable capital. Our second step is to imagine two corporations like Home Interiors. The first corporation (intrastate corporation) resides in Texas and sells its products completely instate. The second corporation (interstate corporation) also resides in Texas but sells its products to instate and out-of-state buyers and is protected by Public Law 86-272 from being taxed on its net income from out-of-state sales. Our final step is to determine whether the interstate corporation bears a tax burden that is not also borne by the intrastate corporation.

Under this hypothetical tax scheme, the intrastate corporation will only pay franchise tax to Texas. Its franchise tax liability will be the greater of a 4.5 percent tax on net taxable earned surplus or a .25 percent tax on net taxable capital. It will never pay a tax on both its taxable capital and its net taxable earned surplus. See Tex. Tax Code Ann. § 171.002(b). Essentially, the intrastate corporation’s franchise tax liability will be assessed on 100 percent of either its taxable capital or its net taxable earned surplus.

The interstate corporation is potentially liable for franchise tax in each state in which it has a substantial nexus, basically each state in which it sold its products. As discussed earlier, the Texas franchise tax is apportioned based on the gross receipts from sales and other specifically enumerated business activities attributable to an individual state. However, because the interstate corporation is protected from being taxed on its net income generated from out-of-state sales by Public Law 86-272, the earned surplus throwback provision mandates that the gross receipts from these sales be thrown back to Texas for use in apportioning Texas’ share of the interstate corporation’s cumulative franchise tax burden. Thus, the interstate corporation’s franchise tax liability to Texas will be the greater of a 4.5 percent tax on net taxable earned surplus or a .25 percent tax on net taxable capital. Both parties agree that in Texas the greater of the two franchise tax components will be the tax on net taxable earned surplus because of the higher tax rate and the inclusion of the gross receipts resulting from the application of the earned surplus throwback provision.

Even though Public Law 86-272 protects the interstate corporation from a tax based on net income in states other than Texas, the interstate corporation would still be hable for franchise taxes on its net taxable capital in those states that hypothetically apply the integrated Texas franchise tax. See INOVA, 166 S.W.3d at 401 (where Public Law 86-272 prohibits taxation of earned surplus, comptroller may impose tax based on capital). Under this hypothetical scenario, the interstate corporation would be subject to a franchise tax based on its net taxable earned surplus in Texas and franchise taxes based on its net taxable capital in all other states. Therefore, because an interstate corporation could be subject to a tax that an intrastate corporation would never bear, the Texas franchise tax as applied to Home Interiors is not internally consistent. See Tyler Pipe, 483 U.S. at 248, 107 S.Ct. 2810; Armco, 467 U.S. at 644, 104 S.Ct. 2620.

The Comptroller contends that the Texas franchise tax is internally consistent because, even if every state imposed an identical tax, no more than 100 percent of an interstate corporation’s taxable capital base or net taxable earned ■ surplus base would be subject to tax. The Comptroller’s theory is predicated on the notion that the internal consistency test should be applied to one tax base at a time, net taxable capital or net taxable earned surplus. In support of this theory, the Comptroller cites to Container Corp. v. Franchise Tax Board, 463 U.S. 159, 163, 103 S.Ct. 2933, 77 L.Ed.2d 545 (1983); Armco, 467 U.S. at 640, 104 S.Ct. 2620; Tyler Pipe, 483 U.S. at 253, 107 S.Ct. 2810; American Trucking Ass’ns, Inc. v. Scheiner, 483 U.S. 266, 107 S.Ct. 2829, 97 L.Ed.2d 226 (1987); Goldberg, 488 U.S. at 256, 109 S.Ct. 582; and Jefferson Lines, 514 U.S. at 177, 115 S.Ct. 1331, to establish that the Supreme Court has invariably applied the test to one taxable base. The Comptroller’s reading of Container Corp., American Trucking, Goldberg, and Jefferson Lines is correct because in those instances the Court was applying the internal consistency test to a singular tax. However, in both Armco and Tyler Pipe, the Court applied the test to tax schemes that consisted of two distinct tax bases. See Tyler Pipe, 483 U.S. at 234-36, 107 S.Ct. 2810; Armco, 467 U.S. at 640-42, 104 S.Ct. 2620. In both cases, the Court concluded that the tax scheme was not fairly apportioned because, applying the internal consistency test, an interstate corporation was subject to a tax that would never be assessed on an intrastate corporation. See Tyler Pipe, 483 U.S. at 248, 107 S.Ct. 2810; see also Armco, 467 U.S. at 644-46, 104 S.Ct. 2620. Similarly, if the hypothetical internal consistency test is applied to the integrated Texas franchise tax, an interstate corporation, that both resides in Texas and is protected by Public Law 86-272 from the imposition of a tax based on net income in other states, would be subject to both a tax on capital in the other state and on earned surplus in Texas, while a similarly situated intrastate corporation would only be subject to the greater of the two taxes. Thus, we find no difference between the application of the internal consistency test in this case and the Supreme ■Court’s application of the test in Armco and Tyler Pipe.

The Comptroller insists that the Texas franchise tax is not facially discriminatory and would pass the internal consistency test in the absence of Public Law 86-272. In her reply brief, the Comptroller explains, “The risk of taxing multi-state corporations on 100% of earned surplus and 100% of capital does not arise from ‘impermissible discrimination against interstate commerce,’ but from the relationship between Public Law 86-272 and the franchise tax.” She also states, “Without Public Law 86-272, Texas franchise taxpayers would all be taxed on the greater of earned surplus or capital.” She then cites Shell Oil Co. v. Iowa Department of Revenue, 488 U.S. 19, 30, 109 S.Ct. 278, 102 L.Ed.2d 186 (1988), for the proposition that “[a] federal law enacted under the Commerce Clause does not invalidate a neutral state statute under the negative Commerce Clause.” She contends that while in operation there may be a risk of discrimination against an interstate company, it is only Public Law 86-272, not the Texas franchise tax, that produces this possibility. Therefore, in light of Shell Oil, the Comptroller insists that the neutral Texas franchise tax survives Commerce Clause scrutiny.

While we agree that the Texas franchise tax is facially neutral, we disagree with the Comptroller’s reading of Shell Oil. Nowhere in the opinion do we find support for the general proposition proffered by the Comptroller. In fact, the Court’s Commerce Clause analysis appears to dictate a case-by-case analysis when determining whether a federal law preempts a state law, even when the state law is facially neutral. See Shell Oil, 488 U.S. at 24-28, 109 S.Ct. 278. More importantly, Public Law 86-272 provoked the earned surplus throwback provision; the throwback provision was designed to take advantage of the effect of Public Law 86-272 — leaving a significant portion of net income from interstate commerce untaxed by any state — by having those receipts thrown back to Texas for inclusion in our franchise tax computations when the business has a significant nexus with this state. See INOVA, 166 S.W.3d at 398 n. 3 (recognizing that Public Law 86-272 has been incorporated into Comptroller’s rules). In the absence of Public Law 86-272, other states would be allowed to impose net income taxes on corporations that merely solicit sales in their state. Without Public Law 86-272 there would be no earned surplus throwback provision in Texas because there would be nothing to throw back. Thus, we conclude that it would be improper to analyze the franchise tax without considering the ramifications of Public Law 86-272.

In conclusion, we hold that the interplay between Public Law 86-272 and the earned surplus throwback provision causes the franchise tax, as applied to Home Interiors, to be internally inconsistent. Therefore, it fails Complete Auto’s fair apportionment requirement. Because we hold that the tax is unfairly apportioned as to Home Interiors, we need not address the final two prongs of the Complete Auto test.

Although we hold that the franchise tax as applied to Home Interiors lacks internal consistency, we acknowledge that the Supreme Court has envisioned a remedy. The Court has recognized that a credit system can be used to cure fair apportionment problems. In Goldberg v. Sweet, the Supreme Court held that the Illinois Tax Act did not pose a risk of multiple taxation because of a credit provision. See 488 U.S. 252, 263-64, 109 S.Ct. 582, 102 L.Ed.2d 607 (1989); see also Tyler Pipe, 483 U.S. at 245 n. 13, 107 S.Ct. 2810 (noting, “[m]any States provide tax credits that alleviate or eliminate the potential multiple taxation that results when two or more sovereigns have jurisdiction to tax parts of the same chain of commercial events.”). Similarly, the Texas legislature might explore granting an interstate company a franchise tax credit to offset any taxes assessed on the interstate company’s capital by a state that threw back receipts to Texas.

We agree with Walter Hellerstem that “[t]he Court has embraced a doctrine of ‘internal consistency’ that may introduce confusion and uncertainty in an area of the law that has had more than its fair share of both.” Walter Hellerstein, Is Internal Consistency Foolish?: Reflections on an Emerging Commerce Clause Restraint on State Taxation, 87 Mich. L.Rev. 138, 188 (1988). An unfairly apportioned state tax discriminates against interstate commerce, but is a hypothetical test that ignores the practical interplay of states’ actual taxation schemes on interstate commerce a proper way to measure internal consistency? We join Justice Scalia in expressing our distrust of hypothetical assumptions to measure the proper reach of the Dormant Commerce Clause: “It seems to me that we should adhere to our long tradition of judging state taxes on their own terms, and that there is even less justification for striking them down on the basis of assumptions as to what other States might do than there is for striking them down on the basis of what other States in fact do.” Tyler Pipe, 483 U.S. at 259, 107 S.Ct. 2810 (Scalia, J., concurring) (emphasis in original). Home Interiors’ interstate commerce is not actually burdened by the earned surplus throwback provision; the risk of multiple taxation is only hypothetical. Nevertheless, the Supreme Court has held that the mere risk of multiple taxation is sufficient to invalidate a state tax as unduly burdensome on interstate commerce. See Jefferson Lines, 514 U.S. at 185, 115 S.Ct. 1331; Tyler Pipe, 483 U.S. at 247, 107 S.Ct. 2810. We cannot ignore that the Texas earned surplus throwback provision creates such a hypothetical risk as applied to Home Interiors.

CONCLUSION

We hold that the interplay between the earned surplus throwback provision and Public Law 86-272 causes the Texas franchise tax to fail the internal consistency test as applied to Home Interiors. Accordingly, Home Interiors’ franchise tax assessment is unfairly apportioned. We reverse the district court’s grant of summary judgment in favor of the Comptroller and render judgment that the Texas franchise tax, as applied to Home Interiors, unconstitutionally burdens interstate commerce. We further order the Comptroller to refund to Home Interiors the franchise taxes in controversy in the amount of $15,480,088 plus interest.

Concurring Opinion by Justice PEMBERTON.

PEMBERTON, J.,

concurring.

I join in the majority’s opinion with the exception of its expressed dissatisfaction with the United States Supreme Court’s current internal consistency test.

      . In apportioning net taxable capital and net taxable earned surplus, the gross receipts of a corporation from its business done in Texas include the receipts from a number of specifically enumerated categories of business activities and services performed here. See Tex. Tax Code §§ 171.103 (West 2002), .1032 (West Supp.2004-05).

      . We note that Home Interiors’ activities exceeded those protected by Public Law 86-272 in fourteen states during certain time periods relevant to this appeal. The Comptroller agreed that gross receipts from sales to those states during the applicable periods were not subject to the throwback provision, and those receipts were excluded from the apportionment calculation.