AFLOA, LLC v. Texas Department of Motor Vehicles

ACCEPTED 15-24-00003-CV FIFTEENTH COURT OF APPEALS AUSTIN, TEXAS 12/16/2024 4:30 PM CHRISTOPHER A. PRINE NO. 15-24-00003-CV CLERK ____________________________________________________________ FILED IN 15th COURT OF APPEALS AUSTIN, TEXAS IN THE COURT OF APPEALS 12/16/2024 4:30:08 PM FIFTEENTH APPELLATE DISTRICT OF TEXAS CHRISTOPHER A. PRINE AUSTIN, TEXAS Clerk _____________________________________________________________

AFLOA LIMITED LIABILITY COMPANY D/B/A AFLOA, Appellant,

v.

TEXAS DEPARTMENT OF MOTOR VEHICLES, Appellee. ____________________________________________________

On Appeal from Cause No. D-1-GN-22-006692 In the 455th Judicial District Court, Travis County, Texas The Honorable Catherine Mauzy, Judge Presiding ____________________________________________________

SUPPLEMENTAL BRIEF OF APPELLEE, THE TEXAS DEPARTMENT OF MOTOR VEHICLES ____________________________________________________ KEN PAXTON ERNEST C. GARCIA Attorney General of Texas Chief, Administrative Law Division

BRENT WEBSTER TED A. ROSS First Assistant Attorney General State Bar No. 24008890 Assistant Attorney General RALPH MOLINA Office of the Attorney General Deputy First Assistant Attorney P.O. Box 12548 (MC 018) General Austin, Texas 78711-2548 512-475-4191 ● fax 512-320-0167 JAMES LLOYD ted.ross@oag.texas.gov Deputy Attorney General for Civil Counsel for Appellee Litigation Texas Department of Motor Vehicles

TO THE HONORABLE JUSTICES OF THE FIFTEENTH COURT OF APPEALS:

Appellee, the Texas Department of Motor Vehicles (TxDMV), by and through the Office of the Attorney General of Texas and the undersigned Assistant Attorney General, submits the following supplemental brief in the captioned appeal.

I. AFLOA failed to file a motion for rehearing of the TxDMV Order on Rehearing, which is a statutory prerequisite to judicial review.

On December 4, 2024, the Clerk of this Court sent a letter to the parties’ counsel requesting supplemental briefing on the issue of whether Appellee, AFLOA Limited Liability Company d/b/a AFLOA (AFLOA), was required to file a motion for rehearing of the TxDMV October 22, 2022 Decision and Order Denying Motion for Rehearing (Rehearing Order). AR 000116-119; Exhibit A. The Court cited Mosley v. Texas Health & Human Servs. Comm., 593 S.W.3d 250, 258 (Tex. 2019) in support of the fact that a motion for rehearing is a jurisdictional prerequisite to judicial review. TxDMV agrees with the Court because the Rehearing Order modified the TxDMV Final Order dated August 31, 2022 by reducing the $500,000 penalty to $50,000. Id. AFLOA was therefore required to file a motion for rehearing of the Rehearing Order because it was a different order than the original Final Order. Ector County Comm’rs Court v. Central Education Agency, 786 S.W.2d 449, 450 (Tex. App.—Austin 1990, writ denied) (agency entered new and different order and county was therefore required to file new motion for rehearing in order to seek *3 judicial review). See also Terrell v. Williams, NO. 03–13–00473–CV, 2015 WL 3393811, at *3 (Tex. App.—Austin May 21, 2015, pet. denied) (mem. op.) (petitioner must file new motion for rehearing when agency modifies its order in response to a motion for rehearing, regardless of the nature of the modifications); see also Southern Union Gas Co. v. R.R. Comm’n, 690 S.W.2d 946, 948 (Tex. App.—Austin 1985, writ ref’d n.r.e.) (requiring new motion for rehearing; agency order “cannot be final and appealable when it has been changed by a subsequent order”).

II. This Court should nevertheless remand this proceeding to the TxDMV to allow AFLOA to file a motion for rehearing of the Rehearing Order.

TxDMV also agrees with the Court that a motion for rehearing of the Rehearing Order is not contained in the record and, in fact, no such MFR was filed. However, TxDMV believes that a remand of this proceeding to the agency in order to allow AFLOA to file a motion for rehearing of the Rehearing Order is warranted under the Supreme Court’s decision in Mosley.

In Mosley, a letter the agency sent to the petitioner transmitting a final decision and order quoted a regulation stating the petitioner had thirty days to seek judicial review from a district court, without mentioning the requirement to file a motion for rehearing. Mosley, 593 S.W.3d at 256. The petitioner did not file a motion for *4 rehearing, and the Court held that the letter’s omission of any reference to a motion for rehearing amounted to a denial of due process. Id. at 254.

In this case, on August 31, 2022 the TxDMV sent a letter to the parties stating that AFLOA may file a motion for rehearing if it disagreed with the TxDMV Final Order. AR 000111-000112. Exhibit B. AFLOA did file a motion for rehearing of that order. AR 000111-112. However, the October 18, 2022 letter transmitting the Rehearing Order of the same date stated that “[t]his Order concludes the appeal process at the administrative level” and “[a]ny party that disagrees or is dissatisfied may file an appeal in the state district court of Travis County or the Third Court of Appeals within thirty (30) days from the date the Motion for Rehearing was denied.” AR TxDMV 000344; Exhibit C. The October 18 letter did not mention the requirement to file a motion for rehearing.

TxDMV therefore believes the proper remedy in this case is to remand the proceeding to the TxDMV in order to allow AFLOA to file a motion for rehearing of the Rehearing Order, as the Court did in Mosley. 593 S.W.3d at 269 (“We do not remand the case to the court of appeals for reconsideration of Mosley’s appeal on the merits because we agree the trial court lacked jurisdiction to consider Mosley’s case in the first place. Instead, we direct the Health and Human Services Commission to reinstate Mosley’s administrative case to afford her an opportunity to seek *5 rehearing of the order entered against her, thus allowing her to seek judicial review by the district court anew should the commission deny her motion for rehearing.”).

CONCLUSION AND PRAYER

For the reasons discussed above, the TxDMV respectfully requests this Court to remand this proceeding to the TxDMV in order to allow AFLOA to file a motion for rehearing of the Rehearing Order.

Respectfully submitted,

KEN PAXTON Attorney General of Texas

BRENT WEBSTER First Assistant Attorney General

RALPH MOLINA Deputy First Assistant Attorney General

JAMES LLOYD Deputy Attorney General for Civil Litigation

ERNEST C. GARCIA Chief, Administrative Law Division

/s/ Ted A. Ross Ted A. Ross Assistant Attorney General State Bar No. 24008890 OFFICE OF THE TEXAS ATTORNEY GENERAL ADMINISTRATIVE LAW DIVISION P. O. Box 12548 Austin, Texas 78711-2548 Telephone: (512) 475-4191 Email: ted.ross@oag.texas.gov

Attorneys for Appellee Texas Department of Motor Vehicles

CERTIFICATE OF COMPLIANCE

In compliance with Texas Rule of Appellate Procedure 9.4(i)(2)(B), this brief contains 810 words, excluding the portions of the brief exempted by Rule 9.4(i)(1).

/s/ Ted A. Ross Ted A. Ross Assistant Attorney General

CERTIFICATE OF SERVICE

I hereby certify that a true and correct copy of the above and forgoing document has been served on the 16th day of December 2024, to the following counsel via E-Service:

Brandon L. Starling Via e-service State Bar No. 24047556 bstarling@whiteandstarling.com Susan G. White State Bar No. 00788658 swhite@whiteandstarling.com WHITE & STARLING, PLLC 2003 N. Lamar Blvd., Suite 110 Austin, Texas 78705 (512) 559-6299 (512) 68108654 Facsimile Attorneys for Appellant

/s/ Ted A. Ross Ted A. Ross Assistant Attorney General

EXHIBIT A

EXHIBIT B

EXHIBIT C

Automated Certificate of eService This automated certificate of service was created by the efiling system. The filer served this document via email generated by the efiling system on the date and to the persons listed below. The rules governing certificates of service have not changed. Filers must still provide a certificate of service that complies with all applicable rules.

Jeff Lutz on behalf of Ted Ross Bar No. 24008890 jeff.lutz@oag.texas.gov Envelope ID: 95371948 Filing Code Description: Other Brief Filing Description: 2024 1216 Supplemental brief Status as of 12/16/2024 4:33 PM CST

Case Contacts Name BarNumber Email TimestampSubmitted Status Ted Ross ted.ross@oag.texas.gov 12/16/2024 4:30:08 PM SENT Jeff Lutz jeff.lutz@oag.texas.gov 12/16/2024 4:30:08 PM SENT Brandon Starling 24047556 bstarling@wso-law.com 12/16/2024 4:30:08 PM SENT Susan White swhite@wso-law.com 12/16/2024 4:30:08 PM SENT