Tom Bennett and James B. Bonham Corporation v. Larry Wayne Grant , 460 S.W.3d 220 ( 2015 )

TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN
ON MOTION FOR REHEARING
NO. 03-11-00669-CV
Tom Bennett and James B. Bonham Corp., Appellants
v.
Larry Wayne Grant, Appellee
FROM THE DISTRICT COURT OF SAN SABA COUNTY, 33RD JUDICIAL DISTRICT
NO. 8086, HONORABLE GUILFORD L. JONES III, JUDGE PRESIDING
OPINION
We withdraw the opinion dated August 13, 2014, and the supplemental opinion and
judgment dated September 26, 2014, and substitute the following opinion and judgment in their
place. We deny the Appellants’ motion for rehearing.
This suit arises from a now infamous feud between neighboring cattle ranchers in
San Saba, the details of which have been thoroughly relayed in prior opinions of this Court and
the Texas Supreme Court. See Bennett v. Reynolds, 242 S.W.3d 866 (Tex. App.—Austin 2007),
rev’d & remanded in part by 315 S.W.3d 867 (Tex. 2010) (Bennett I). The feud between cattle
ranchers Thomas O. Bennett and Randy Reynolds has many turbulent twists and turns, see id., but
the gist of the dispute and subject of prior appeals involved allegations that thirteen head of cattle
belonging to Reynolds had wandered onto Bennett’s ranch, and that instead of returning them in a
neighborly fashion, Bennett ordered his ranch hand—Larry Grant—to round up the cattle and sell
them at auction. Grant testified that he raised concerns with Bennett that the cattle did not belong
to him, but Bennett ignored his concerns.1 Worried that he could be implicated in cattle theft, Grant
purchased a disposable camera and took several photos of the cattle loaded on Bennett’s trailer
prior to the sale. Within two months of the sale, Grant left his employment with Bennett but kept
the secret photos stashed away in a box in his home where they were seemingly forgotten and left
undisturbed for almost a year. Reynolds, however, eventually learned of the secret photos after a
chance encounter with Grant’s brother-in-law and demanded that Grant turn the photos over to the
authorities. What happens next is hotly disputed and the subject of litigation between Bennett and
his former ranch hand, Grant, which gave rise to this appeal.
After Reynolds attempted to obtain the photos, Grant testified that he was distressed
and began drinking beer and smoking marijuana to relieve tension. He then made a series of
phone calls to Bennett and Bennett’s friend and employee, Don “Ex” Rogers. Grant testified that
the purpose of the calls was to inform Bennett of the pictures and give him an opportunity to “make
it right” with Reynolds. Bennett and Rogers’ version, however, depicts Grant as calling to try and
sell the photographs to Bennett. Grant acknowledged he had some discussion with Rogers about
selling the photos to Bennett but testified that they only “joked about it.” It was no joke, however,
when Grant turned the photos over to law enforcement about a month after these conversations
and triggered an extraordinary series of events. First, Bennett was indicted for cattle theft based
1
The facts recited herein are taken from the record on appeal.
2
in part on Grant’s testimony and photos. Although ultimately acquitted of the criminal charges,
Bennett and his cattle company, the James B. Bonham Corporation, were found liable for conversion
in a civil suit brought by Reynolds resulting in a judgment of $5,327.11 in actual damages. The
actual damages, however, paled in comparison to the combined exemplary damages of $1.25
million awarded amidst allegations that Bennett had willfully sold his neighbor’s cattle to settle
a score in a long-standing feud and then attempted to cover his actions by—among other
allegations—threatening and bribing witnesses, tampering with the photographs Grant had taken to
alter the images of the brands on the cattle to look like his own brand, and even attempting to
register his neighbor’s brand as his own with the district clerk of San Saba County. Such allegations
and such a large exemplary damages award are extraordinary by themselves,2 but it is only half of the
story and less than half of the total liability adjudged against Bennett and the Bonham Corporation
from these events.
The other half is the subject of this appeal—a $2.28 million judgment awarded to
Grant for a successful malicious prosecution claim brought against Bennett and the Bonham
Corporation. This claim arose from Bennett’s admitted, yet ultimately unsuccessful, campaign to
have Grant imprisoned after he turned the photos over to authorities. In this appeal, Bennett and
the Bonham Corporation (collectively, Appellants) contest the judgment in Grant’s malicious
prosecution suit, contending: (1) legally insufficient evidence supported the malicious prosecution
claim; (2) legally and factually insufficient evidence supported the $10,703 awarded in compensatory
2
Indeed, the Texas Supreme Court found the exemplary damages violated due process and
remanded the case for remittitur. See Bennett I, 315 S.W.3d at 883.
3
damages; (3) legally insufficient evidence supported the jury’s findings allowing for the imposition
of exemplary damages over the statutory cap; and (4) the total $2 million exemplary damages award
($1 million against Bennett and $1 million against the Bonham Corporation) violated due process.
Individually, the Bonham Corporation raises several arguments challenging its liability in the suit,
and Bennett challenges a $269,644.50 sanction. We conclude that the award of exemplary damages
failed to comport with due process requirements and required remittitur, but otherwise uphold the
trial court’s judgment.
MALICIOUS PROSECUTION
A. Background Facts
On the evening of October 4, 2001, telephone records confirm that Grant called
and spoke with Bennett for thirteen minutes, but the topic of conversation that evening is hotly
disputed by the parties. As previously discussed, Grant testified that he called to inform Bennett
about the pictures and to give him an opportunity to “make it right” with Reynolds. Bennett,
however, testified that Grant called to try and sell the photos to him for $5,000. What is undisputed,
however, is that Bennett waited nearly two years to report his allegations against Grant to the
authorities. Indeed, Bennett testified that it was not until after his criminal trial that he decided to
report the incident to authorities and acknowledged at trial that his sole “goal” in reporting the
incident was to put “Grant in prison . . . for what he’s done to me.” In furtherance of his goal, Bennett
testified he met with law enforcement authorities in four separate counties in an attempt to get
Grant indicted for attempted blackmail. After authorities in San Saba County, Llano County, and
4
Coleman County refused to prosecute Grant, Bennett met with the district attorney in Navarro County
and requested he prosecute the case.
According to the district attorney’s testimony, the following events then transpired.
After his initial meeting with Bennett, the district attorney believed that if an attempted blackmail
had occurred, it was a federal offense and referred the matter to the federal authorities. Unhappy
with this outcome, Bennett again approached the district attorney but this time with a new
theory—requesting that Grant be prosecuted for attempted theft. The district attorney informed
Bennett he could not bring charges for misdemeanor attempted theft because it was barred by the
two-year statute of limitations. Undeterred, Bennett then provided the district attorney with new
information, alleging—for the first time—that Grant had attempted to extort money from him a
second time within the limitations period. The district attorney testified that he was “skeptical” of
this new evidence because it “appeared that there was maybe some tailoring of the facts going on to
fit the statute.” Indeed, in his sworn testimony in this case, Bennett made no mention of a second
attempted blackmail by Grant. Rather, he unequivocally testified that all the factual accusations
against Grant occurred in a single evening on October 4, 2011. The district attorney further testified
that, based on his conversations with Bennett about the case, he formed the impression that
Bennett’s motive for prosecuting Grant was to gain an advantage in civil litigation arising from the
case. Being “suspicious” of Bennett’s new evidence, the district attorney decided to “dig in his heels”
and refused to prosecute.
Still undeterred, Bennett met with an attorney who testified that he had represented
the Bonham Corporation for over twenty years and that Bennett directed him to research and draft
5
a legal brief advocating that Grant’s alleged actions constituted a criminal offense that should be
prosecuted. The district attorney testified that it was this brief or another meeting with Bennett that
finally was the “catalyst” that prompted him to bring the case to the grand jury. He further testified
that it was “rare” for him to bring misdemeanor cases to the grand jury because he himself had the
authority to bring misdemeanor charges without grand jury involvement. But, in this case, he finally
yielded to Bennett’s demands because he did not want to appear “draconian” in his refusal to bring
charges. The district attorney may have been finally persuaded to present the case, but the grand jury
was not as persuaded and refused to indict Grant.
Frustrated that the grand jury had not indicted Grant, Bennett testified he again
met with the same attorney who this time advised him to get a special prosecutor appointed in
Navarro County to bring the case before the grand jury a second time. After the attorney explained
to him the procedure for appointing a special prosecutor, Bennett testified he had the attorney draft
a petition alleging the district attorney had a conflict of interest and accusing him of taking no
action in the case.3 The petition further sought the appointment of Robert Dunn—a local attorney
and neighbor of Bennett’s—as a special prosecutor for the case. Bennett, who resided and ran a
cattle ranch in Navarro County, testified that he then led the effort to circulate and obtain over 250
signatures from Navarro County residents for the petition seeking the appointment of Dunn as
special prosecutor for the case. Bennett testified that others helped with the petition but that “it was
mostly me . . . I think I done most of it.” The district attorney, who was now seeking reelection
3
The petition alleged the district attorney had a conflict of interest in the case because he
had previously worked for the district attorney’s office in Llano County.
6
in a hotly contested race, testified that he was unaware that Bennett was leading this campaign
throughout the county until Bennett showed up at his office for a final meeting. Bennett, with the
signed petitions in hand, then accused the district attorney of being partial and unfair when he
presented Grant’s case to the grand jury and demanded that Dunn be appointed special prosecutor
in the case. Feeling that Bennett’s petition campaign “wasn’t helping” his chances of reelection,
the district attorney testified that he agreed to the appointment of Dunn as special prosecutor in
the case.4
Ultimately, Bennett was successful in his goal of getting Grant indicted, as the
special prosecutor presented the case for a second time to the grand jury—more than four years
after the phone call between Grant and Bennett occurred—but this time obtained indictments for the
felony offenses of tampering with a witness and attempted bribery. The special prosecutor testified
that in deciding whether to present the case to the grand jury, he interviewed both Bennett and
Rogers but exercised independent discretion in ultimately determining whether there was sufficient
evidence to prosecute the case. He testified further that he relied on evidence other than Bennett’s
and Rogers’ statements in his decision to prosecute. When asked, however, whether Bennett’s and
Rogers’ statements were “very material to [his] decision to proceed to the grand jury,” the special
prosecutor acknowledged that the statements were “definitely” very material to his decision. Further,
he acknowledged testifying during his deposition that he “would not have presented” the case to the
4
Later that year, the district attorney lost his reelection. Almost immediately after starting
private practice, Bennett came to the former district attorney’s office and retained him as counsel
for himself and the Bonham Corporation in two separate lawsuits.
7
grand jury if he had believed Bennett “was making untrue statements.” He also testified that if he
believed there had been a “tailoring of the facts” by Bennett—as the Navarro County district attorney
believed—that it would have affected his decision to go to the grand jury.5 Grant maintained
throughout trial that both men had lied to the authorities about the alleged blackmail.
Further, some of the evidence Bennett presented to the special prosecutor appears
from the record to have differed from the initial evidence presented to the district attorney. First,
there is no evidence in the record that Bennett reported to the special prosecutor two incidents of
alleged extortion occurring on different dates—as he had to the district attorney. Rather, the special
prosecutor testified only as to the alleged misconduct occurring during phone conversations on
October 4, 2011, and the indictment alleged only one count—not two—of the charged offenses.
Second, Bennett added a new detail to his allegations, contending for the first time that Grant had
specifically asked him to pay $5,000 for the pictures. In a previous written statement to the
authorities, Bennett did not allege a specified amount in his extortion claims. The Navarro County
district attorney also did not recall Bennett telling him this detail, and it would have been material
to how he presented the case to the grand jury because the amount of money at issue increased the
degree of the offense.6 See Tex. Penal Code § 31.03(e) (value of property involved in theft dictates
classification of offense). Finally, the special prosecutor additionally testified that in deciding to
5
The Navarro County district attorney testified that he had informed the special prosecutor
of his belief that there had been some tailoring of the facts by Bennett. The special prosecutor denied
this, testifying that “no one had told [him]” of any manipulation of the facts by Bennett.
6
Interestingly, the district attorney testified that the amount at issue increased the degree of
the offense from a misdemeanor to a felony. The statute of limitations for felony theft is five years,
rather than the two year statute of limitations for misdemeanor theft. See Tex. Code Crim. Proc.
arts. 12.01(4)(A), 12.02.
8
prosecute the case, he relied—in part—on a transcript from Bennett purportedly transcribing
secretly-taped “conversations” with Grant that substantiated Bennett’s claim that Grant had sought
$5,000 from him. If this transcript was also given to the district attorney, he made no reference to
it in his testimony.
Regarding the transcript, the special prosecutor testified that initially Bennett
presented him with a tape recording of “conversations” but that he was unable to understand it
because it was “awful garbled.” Bennett then gave him a transcript purportedly transcribing the
tape. The special prosecutor could not testify as to when the tape was allegedly recorded, but it
appears from his testimony that he believed the tape was a recording of the actual telephone
conversations reflected on Grant’s telephone bill or conversations related directly to those phone
records. He further testified that the taped conversations substantiated Bennett’s claim that Grant
had specifically sought “$5,000” for the pictures. This transcript, however, was destroyed when
Grant’s record was later expunged. Besides this information, there is no additional information in
the record as to what was reflected in the transcript or the tape. Bennett himself testified at trial that
he had secretly recorded a conversation with Grant and had presented this tape to law enforcement,
but this tape recorded only a single conversation between Grant and Bennett occurring almost a year
prior to Grant’s alleged extortion. As such, there is no mention on the tape of the photographs or
a demand for $5,000. Indeed, when the special prosecutor was presented with a transcript of the tape
Bennett testified to presenting to other law enforcement, the special prosecutor testified that he had
never seen it before, and it was “completely different” than the transcript Bennett had given him.
Bennett’s plan to imprison Grant seemed to finally be coming to fruition when the
special prosecutor then took this evidence to a second grand jury and succeeded in obtaining two
9
felony indictments, and Grant surrendered himself to authorities. But Bennett’s long and hard-fought
quest ended nine months later, when both of Grant’s indictments were quashed because the charges
had been filed past the statute of limitations. Further, the trial court granted Grant’s motion to have
his arrest and indictments expunged from his record as void. Upon expunction, Grant—who was
already being sued by Bennett for slander—added a counterclaim against Bennett and the Bonham
Corporation for malicious criminal prosecution.7 Upon hearing the preceding evidence, the jury found
that Bennett and the Bonham Corporation had indeed maliciously prosecuted Grant. They appeal,
contending there is insufficient evidence of a malicious prosecution. Appellants’ claim requires us to
first expound upon the law of malicious prosecution.
B. Malicious Prosecution
Malicious prosecution is an unusual tort in that it requires the court to balance
society’s interest in protecting private persons who report criminal conduct with the individual
citizen’s interest in being protected against unjustifiable and oppressive litigation of criminal
charges. Browning-Ferris Indus., Inc. v. Liek, 881 S.W.2d 288, 290–91 (Tex. 1994). In that regard,
the Texas Supreme Court has instructed us that the balance between these important interests is
maintained by strictly adhering to the defined elements of an action for malicious prosecution and
that even a small departure from the exact prerequisites for liability may threaten this delicate
balance. Id. But, “as with any other cause of action, if the elements of malicious prosecution are
proved, liability is established.” Id. at 291. Those elements are: (1) the commencement of a criminal
7
The jury found against Bennett on his slander claim, which Bennett does not appeal.
10
prosecution against the plaintiff; (2) causation of the action by the defendant; (3) termination of the
prosecution in the plaintiff’s favor; (4) the plaintiff’s innocence; (5) the absence of probable cause
for the proceedings; (6) malice in filing the charges; and (7) damages. Richey v. Brookshire Grocery
Co., 952 S.W.2d 515, 517 (Tex. 1997).
Appellants do not dispute the jury’s findings that there was no probable cause to
prosecute Grant, that Grant was innocent of the charges, and that Bennett acted with malice in
pursuing the charges. Rather, they argue only that there is legally insufficient evidence that Bennett’s
conduct caused the commencement of a criminal prosecution against Grant. The causation element
of malicious prosecution requires evidence that a defendant “initiated” or “procured” a criminal
prosecution. Lieck, 881 S.W.2d at 292. A person initiates a criminal prosecution if he makes a
formal charge to law enforcement authorities. Id. Here, there is no evidence in the record that
Bennett filed any formal charges; Grant, therefore, relies on procurement. A person “procures” a
criminal prosecution “if his actions are enough to cause the prosecution, and but for his actions the
prosecution would not have occurred.” Id. Thus, procurement requires that a person’s actions be
both a “necessary and a sufficient cause of the criminal prosecution.” Id. Appellants argue there is
no evidence Bennett “procured” Grant’s criminal prosecution because the prosecutors involved
acted with independent discretion, and their exercise of discretion was a superceding, intervening
cause of the prosecution that destroyed his own liability in bringing about the charges. Appellants
are correct that generally a person cannot procure a criminal prosecution when the decision whether
to prosecute is left to the discretion of another because the independent exercise of discretion
destroys the necessary causal link between the defendant and the prosecution. See id. There are,
11
however, two important exceptions to this rule where a defendant may still be liable for malicious
prosecution because his actions are such that it makes an intelligent exercise of discretion impossible:
(1) when a defendant provides information which he knows is false that causes a criminal prosecution,
or (2) when a defendant’s conduct was the determining factor in the prosecutor’s decision to
prosecute. See id. at 292–94. We conclude there is legally sufficient evidence to support the jury’s
finding of causation under both exceptions.
1. Legally sufficient evidence Bennett procured Grant’s prosecutions by providing
false information.
The first exception is when a defendant provides information which he knows is false
that causes a criminal prosecution. See id. at 293. For this exception, the plaintiff must prove both
that the defendant knowingly furnished false information to authorities, and that but for such false
information, the prosecutor would not have decided to prosecute. King v. Graham, 126 S.W.3d 75,
76 (Tex. 2003). The prosecutor’s reliance on the false information makes an intelligent exercise
of discretion impossible and establishes the causal link necessary to hold the defendant liable for
malicious prosecution. See id. at 78. But, if the decision to prosecute would have been made
with or without the false information, the defendant did not cause the prosecution by supplying
false information. A single prosecution may, however, be procured by more than one person. Lieck,
881 S.W.2d at 292.
Appellants challenge only the legal sufficiency of the jury’s finding that Bennett
procured Grant’s prosecution. A party challenging the legal sufficiency of the evidence supporting
an adverse finding on an issue for which the opposing party bears the burden of proof will prevail
12
if there is a complete absence of evidence of a vital fact or if the evidence offered to prove a vital
fact is no more than a scintilla. See Waste Mgmt. of Tex., Inc. v. Texas Disposal Sys. Landfill, Inc.,
No. 12-0522-CV, 2014 WL 1875637, at *8 (Tex. May 9, 2014); City of Keller v. Wilson, 168 S.W.3d
802, 810 (Tex. 2005). More than a scintilla exists when the evidence as a whole rises to a level
enabling reasonable and fair-minded people to have different conclusions. Merrell Dow Pharms., Inc.
v. Havner, 953 S.W.2d 706, 711 (Tex. 1997). In conducting a legal-sufficiency review, we consider
the evidence in the light most favorable to the judgment, crediting evidence that a reasonable fact
finder could have considered favorable and disregarding unfavorable evidence unless the reasonable
fact finder could not. City of Keller, 168 S.W.3d at 807. We indulge every reasonable inference that
supports the jury’s findings. Id. at 822. Therefore, we must uphold the jury’s verdict unless—after
viewing the evidence in the light most favorable to the jury’s verdict and disregarding contrary
evidence unless a reasonable jury could not—there is no more than a scintilla of evidence to support
the finding of procurement.
Reviewing the evidence in the light most favorable to the jury’s verdict, the Navarro
County district attorney believed Bennett’s claims were barred by limitations and would never have
brought this case before the grand jury but for Bennett changing his story to add an additional claim
of extortion occurring within the limitations period. As Grant testified this was a false allegation,
we will assume—for purposes of our analysis—that the allegation was false, and there is more than
sufficient evidence that the false allegation was the but-for cause of the prosecutor presenting the
case to the grand jury. Traditionally, however, the tort of malicious prosecution does not arise until
process is issued, an indictment is returned, information filed, or the accused is arrested. See
Restatement (Second) of Torts § 654 (1977). Here, there is no evidence in the record that any of
13
these events occurred with regard to this first proceeding before the grand jury or that Grant was
aware of or suffered damages from this proceeding. Accordingly, the bulk of our analysis must
focus on the second presentment of the case to the grand jury by the special prosecutor, which
ultimately resulted in two indictments and Grant’s arrest.
Viewing the evidence regarding the second grand jury proceeding in the light most
favorable to the verdict, we conclude there was more than a scintilla of evidence to support the jury’s
finding that Bennett procured the prosecution. The special prosecutor acknowledged in his testimony
that Bennett’s statements were “definitely . . . very material” to his decision to proceed to the grand
jury. He further acknowledged that if he had believed Bennett’s statements were untruthful, then
he “would not have presented” the case to the grand jury. Assuming Bennett’s statements were false,
the special prosecutor’s testimony provides more than a scintilla of evidence that Bennett was a
necessary and sufficient cause of the prosecution. Compare King, 126 S.W.3d at 79 (holding
insufficient evidence of causation where “[n]othing in the record shows that the false information
was material to the decision to prosecute”). Further, there was additional evidence that the special
prosecutor relied on the transcript that Bennett had given him allegedly transcribing secretly-taped
conversations with Grant. From the record, there was sufficient evidence for the jury to infer
that Bennett had fabricated this evidence and that it was a material cause of the prosecution, as the
special prosecutor testified that the transcript substantiated Bennett’s claim that Grant had sought
$5,000 from him.
For legal sufficiency review, we consider the evidence in the light most favorable to
the judgment, crediting evidence that a reasonable fact finder could have considered favorable and
14
disregarding unfavorable evidence unless a reasonable fact finder could not. See City of Keller,
168 S.W.3d at 827. We note here the special prosecutor testified that—in addition to the information
provided by Bennett—he also relied on Grant’s sworn testimony from Bennett’s prior criminal trial
for cattle theft. At that trial, the special prosecutor testified Grant purportedly admitted making a
phone call to Rogers seeking money for the pictures but alleged he was only “joking.”8 The special
prosecutor testified that in his opinion Grant “tried to cover himself” by alleging that it was a joke,
and when asked whether he would have prosecuted based solely on this testimony, he responded:
“I think so, because the fact is that he admitted making the calls.” (emphasis added). When a
prosecutor relies on evidence independent of the false information provided by the defendant, the
defendant “cannot be said to have caused the prosecution if the [false] information was immaterial
to the decision to prosecute.” King, 126 S.W.3d at 78. The special prosecutor, however, had
previously acknowledged that Bennett’s evidence was definitely very material to his decision to
prosecute and that he would not have presented the case if he had thought Bennett was providing
false information.9
8
The transcript from Grant’s sworn testimony is not in the record. Grant advanced the same
theory of innocence at this trial. For purposes of the malicious prosecution claim, the jury found
Grant innocent of Bennett’s allegations.
9
The special prosecutor also testified that he relied on Rogers’ statement that Grant had
telephoned him and acknowledged attempting to sell the photos to Bennett. At trial, Bennett testified
that Rogers “was in on the efforts to get [Grant] charged.” Rogers is described in the record as
Bennett’s best friend and an employee of the Bonham Corporation. At trial, Grant denied Rogers’
accusations, and the jury was free to disbelieve his testimony. The Texas Supreme Court has
instructed that “[j]ust as there may be more than one proximate cause of an event, a single
prosecution may be procured by more than one person.” Browning-Ferris Indus., Inc. v. Lieck, 881
S.W.2d 288, 292 (Tex. 1994). The fact that Rogers may also be liable for procuring Grant’s
prosecution does not negate Bennett’s own liability.
15
To the extent there is any conflict in the special prosecutor’s testimony as to the cause
of the prosecution, causation is generally a question of fact for the jury, see Rodriguez v. Moerbe,
963 S.W.2d 808, 818–19 (Tex. App.—San Antonio 1998, pet. denied), and there is more than a
scintilla of evidence to support the jury’s fact finding that Bennett’s false information was a
necessary and sufficient cause of the prosecution. Further, the jury was entitled to resolve any
conflicts in the special prosecutor’s testimony and could choose to believe or disbelieve all or part of
his testimony. See McGalliard v. Kuhlmann, 722 S.W.2d 694, 697 (Tex. 1986) (jury may “resolve
inconsistencies in the testimony of any witness”); see also City of Keller, 168 S.W.3d at 819 (“Jurors
are the sole judges of the credibility of the witnesses and the weight to give their testimony. . . .
Reviewing courts cannot impose their own opinions to the contrary.”). Consequently, we conclude
a reasonable jury could find that the false information provided by Bennett was a necessary and
sufficient cause of Grant’s prosecution and disregard any contrary evidence. After reviewing the
evidence under the appropriate standard, we conclude there is legally sufficient evidence to support
the jury’s finding that Bennett procured Grant’s criminal prosecution by providing false information.
2. Legally sufficient evidence Bennett procured Grant’s prosecution by other
improper conduct.
The second exception in which a defendant may be liable for malicious prosecution
is “when his conduct is the determining factor in the prosecutor’s decision to prosecute.”10 See
10
Appellants contend this is not a recognized exception under Texas law. We disagree. In
accordance with the Restatement of Torts, the Texas Supreme Court has stated that a defendant may
procure a prosecution “not only when he gives information he knows is false to a prosecutor, but also
when his conduct is the determining factor in the prosecutor’s decision to prosecute.” Browning-
Ferris Indus., Inc. v. Lieck, 881 S.W.2d 288, 294 (Tex. 1994) (citing Restatement (Second) of Torts
16
Lieck, 881 S.W.2d at 294. For this exception to be applicable, it must “appear that [the defendant’s]
desire to have the proceedings initiated, expressed by direction, request or pressure of any kind,
was the determining factor in the official’s decision to commence the prosecution.” Id. (quoting
Restatement (Second) Torts § 653 (1977)). The Texas Supreme Court in 1994 adopted this exception
set out in the Restatement of Torts. See id. We note, however, that the parties have not cited to, and
we have not found, any Texas case that has determined what type of conduct would constitute
“procurement” under this exception. See Michol O’Connor, O’Connor’s Texas Causes of Action,
ch. 19-A, at 572 (2014) (“No Texas court has determined what type of conduct, other than providing
false information, would constitute procurement.”). After careful review of the record in this case,
we conclude this is the rare case where the defendant engaged in such an intentional and systematic
abuse of the justice system that there was sufficient evidence his conduct was the determining factor
in the prosecution.
As there are no examples under Texas case law, we will draw upon the Restatement
itself for guidance. The Restatement provides the following example as illustration of this exception:
A goes to B, a district attorney and informs him that C has committed a
battery upon A. A is a political boss to whom B owes his election. A demands that
B prosecute C. The battery is one that has created no public disturbance and is
therefore an offense for which a public prosecutor would not ordinarily institute
proceedings. In compliance with A’s demand, B files an information against C. A
has procured the institution of the proceeding.
§ 653 (1977)); see also Turner v. Roadway Express, Inc., 911 S.W.2d 224, 226 (Tex. App.—Fort
Worth 1995, writ denied) (recognizing Texas Supreme Court’s holding in Lieck that malicious
prosecution may occur when either a person gives false information to authorities or when a person’s
conduct was determining factor in decision to prosecute).
17
Restatement (Second) Torts § 653 (1977). In the example, the defendant procured the prosecution
by exerting improper pressure on the district attorney to bring charges that ordinarily would not have
been filed. Similarly, in this case, there is legally sufficient evidence in the record that Grant would
not have been prosecuted but for Bennett’s acknowledged and systematic campaign to improperly
influence the proceedings. First, the Navarro County district attorney testified emphatically that
although he had the authority to file an information charging Grant with misdemeanor attempted
theft, he “dug in his heels” and steadfastly refused to press charges against Grant because of the
statute of limitations and because he believed Bennett had been tailoring the facts to create a
chargeable offense. Only after immense pressure from Bennett and some altering of the facts, did
the district attorney finally yield and agree to bring the misdemeanor case before the grand jury.
He testified, however, that ordinarily he would not have presented this misdemeanor case to the
grand jury but only did so because of Bennett’s unceasing demands. Like the example in the
Restatement, this proceeding before the grand jury would never have occurred but for Bennett
exerting such pressure on the district attorney that his desire to have the proceeding commenced was
the determining factor in the district attorney’s decision to prosecute.
After the grand jury refused to indict, Bennett—undeterred in his goal of having
Grant imprisoned—then organized and led an extraordinary petition campaign to put in place a
hand-picked special prosecutor to indict Grant. At a time when the district attorney was facing a
heavily-contested election, Bennett then came to the district attorney’s office with the petitions
demanding the appointment of his special prosecutor to the case. Feeling Bennett’s petition campaign
“wasn’t helping” his chances of reelection, the district attorney again yielded to Bennett’s demands.
Here, like the example in the Restatement, Grant’s second prosecution was a proceeding that would
18
have never occurred but for Bennett’s exertion of untoward pressure on the district attorney.
Undoubtedly, there is more than a scintilla of evidence that Bennett’s acknowledged and systematic
campaign to improperly influence judicial proceedings was the determining factor in the prosecution.
Accordingly, we conclude there is legally sufficient evidence that Bennett procured
Grant’s prosecution by either providing false information to authorities or by engaging in such a
systematic and untoward campaign to influence judicial proceedings that his conduct was the
determining factor in the prosecution.
CORPORATE LIABILITY
Having found sufficient evidence of Bennett’s liability in this suit, we next
address Bonham’s liability. With regard to Bonham, the jury made several alternate findings
imputing corporate liability on Bonham for the malicious prosecution. First, under the malicious
prosecution question, the jury found that both Bennett and Bonham—through an agent—had
maliciously prosecuted Grant. Second, the jury found that Bennett was acting in his capacity as
a vice-principal of Bonham when he maliciously prosecuted Grant. Finally, the jury found that
Bonham was responsible for Bennett’s conduct under a “reverse-piercing” theory of liability. In
two individual issues, Bonham contests its liability, arguing: (1) that it was improperly joined as a
party to the suit and (2) there is no evidence to support the jury’s findings of corporate liability.
A. Joinder
In its first individual issue, Bonham contends that it was improperly joined as a party
to this suit. A trial court is given a great deal of discretion in matters of joinder, and its decision on
19
such procedural issues will not be disturbed on appeal absent an abuse of discretion. Varme v. Gordon,
881 S.W.2d 877, 882 (Tex. App.—Houston [14th Dist.] 1994, writ denied). A trial court abuses its
discretion when it has acted in an unreasonable or arbitrary manner, or when it acts without reference
to any guiding principle. Coburn v. Moreland, 433 S.W.3d 809, 823 (Tex. App.—Austin 2014, no
pet.). A trial court’s decision on the matter of the joinder of an additional party is “generally based
on practical considerations with a view to fair, orderly and timely prosecution and disposal of
pending litigation.” Fireman’s Fund Ins. Co. v. McDaniel, 327 S.W.2d 358, 373 (Tex. Civ.
App.—Beaumont 1959, no writ).
Bonham’s misjoinder claim necessitates a brief review of this case’s procedural
history. This suit was originally initiated by Bennett—the plaintiff in this suit—filing an original
petition suing Grant for slander. In his original answer, Grant asserted a counterclaim against
Bennett for intentional infliction of emotional distress. Later, in an amended pleading, Grant
added Bonham as an additional counter-defendant to his intentional infliction of emotional
distress claim. Upon request of the trial court, Grant then filed a motion seeking leave to include
Bonham in the suit. Grant’s motion for leave sought to add Bonham as a party to the suit on the
grounds that Bonham was Bennett’s alter ego, and his claims of intentional infliction of emotional
distress against both Bennett and Bonham “arose from the same transaction, occurrence, or series
of transactions or occurrences . . . and the questions of law and fact in this case are common to both
[Bennett and Bonham].” After a hearing, the trial court granted the motion without stating the
grounds for the joinder and ordered Grant to serve Bonham with process. After being served, Bonham
answered as a party to the suit without further objection. Later, after Bonham had entered an
20
appearance in the suit, Grant again amended his pleadings to add—after his indictments were
expunged—an additional counterclaim against Bennett and Bonham for malicious prosecution.
Bonham answered the malicious prosecution claim without objection.
On appeal, however, Bonham contends it was improperly joined in the lawsuit under
Texas Rule of Civil Procedure 38. See Tex. R. Civ. P. 38. Rule 38 provides that a defendant may
bring in a third party to a suit if that person is or may be liable to him or the plaintiff for all or part
of the plaintiff’s claim against him. Id. A third-party action under Rule 38 is not an independent
cause of action but is derivative of the plaintiff’s claim. Id.; see In re Seven-O Corp., 289 S.W.3d
384, 390 (Tex. App.—Waco 2009, orig. proceeding [mand. denied]). Here, we agree with Bonham
that Grant’s claim asserting an independent cause of action against it for intentional infliction of
emotional distress was not a third-party claim as contemplated by Rule 38. Grant did not assert—as
Rule 38 requires—that Bonham was liable for all or part of Bennett’s slander claim against him.
Rather, Grant sought to join Bonham as an additional party to his counterclaim seeking affirmative
relief for intentional infliction of emotional distress.
We cannot, however, conclude that Bonham has proven the trial court abused its
discretion by allowing the joinder because our rules of civil procedure otherwise permit the joinder
of a non-party to a previously filed counterclaim. Texas Rule of Civil Procedure 97 provides that
additional persons—other than those made parties to the original action—may be made parties to
a counterclaim in accordance with the provisions of Rule 39 (“Joinder of Persons Needed for Just
Adjudication”) and Rule 40 (“Permissive Joinder of Parties”). See Tex. R. Civ. P. 39, 40, 97(f);
see also Tex. R. Civ. P. 37 (“Before a case is called to trial, additional parties necessary or proper
21
parties to the suit, may be brought in, either by the plaintiff or the defendant upon such terms as the
court may prescribe.”). Thus, non-parties must be joined as additional defendants to a counterclaim
if in their absence complete relief cannot be afforded among the parties. See Tex. R. Civ. P. 39,
97(f). In addition, the trial court has the discretion to permit the joinder of additional defendants to
a counterclaim under the permissive joinder provisions of Rule 40. See Tex. R. Civ. P. 40 (“All
persons may be joined in one action as defendants if there is asserted against them jointly, severally,
or in the alternative any right to relief in respect of or arising out of the same transaction, occurrence,
or series of transactions or occurrences and if any question of law or fact common to all of them will
arise in the action”), 97(f) (persons other than those made parties to the original action may be made
parties to a counterclaim in accordance with the provisions of Rule 40).11
Further, we note that once Bonham entered an appearance in this suit, Grant was
entitled to assert his additional counterclaim against Bonham for malicious prosecution without
further service of process. See Tex. R. Civ. P. 97(b), 124. Under these circumstances, we cannot
conclude—nor has Bonham proven—that the trial court abused its discretion by permitting the
joinder. See Varme, 881 S.W.2d at 883 (“We emphasize that the trial court is given great discretion
over joinder questions.”). Accordingly, we overrule Bonham’s joinder arguments.12
11
On rehearing, the Appellants contend they had no notice that Grant was seeking to join
Bonham under permissive venue. Grant’s motion for leave sought to add Bonham as a party to his
counterclaim and tracked the language of the permissive joinder rule. See Tex. R. Civ. P. 40.
12
Bonham hints in its brief that “Grant’s claims against the Corporation were thinly veiled—yet
ultimately successful—efforts to avoid limitations.” The statute of limitations issue was not submitted
in the jury charge, and Bonham does not assert in an issue on appeal that the evidence conclusively
proves Grant’s claims were barred by limitations. Nor does Bonham appeal any ruling it sought with
sufficient specificity to make the trial court aware of its limitations complaint. We need not address
the merits of the limitations issue.
22
B. Corporate Liability
In its second individual issue, Bonham contends there is no evidence to support
the jury’s finding of corporate liability. Corporations can act only through human agents, and
when “actions are taken by a vice-principal of a corporation, those acts may be deemed to be the
acts of the corporation itself.” See GTE Sw., Inc. v. Bruce, 998 S.W.2d 605, 618 (Tex. 1999); see
also Qwest Int’l Commc’ns, Inc. v. AT&T Corp., 167 S.W.3d 324, 326 (Tex. 2005) (corporation is
liable for exemplary damages if it acts with malice through the actions of a vice-principal). A
corporation, however, cannot be liable for damages “if the vice-principal’s misconduct occurred
while he was acting in a personal capacity unrelated to his authority as a corporate vice-principal.”
Bennett I, 315 S.W.3d at 884. A vice-principal of a corporation is a person who “represents the
corporation in its corporate capacity, and includes persons who have authority to employ, direct, and
discharge servants of the master, and those to whom a master has confided the management of the
whole or a division of his business.” Id. at 883.
Regarding Bennett’s relationship with Bonham, the Texas Supreme Court in Bennett I
concluded that Bennett was “indisputably a vice-principal of the Bonham Corporation, he was most
likely the only vice-principal and the only person whose conduct and decisions could subject the
corporation to exemplary damages.” Id. at 884. In this case, similar evidence was presented that,
although Bonham was putatively owned by Bennett’s daughters, the daughters had no control over
the corporation and received no profits, and Bennett himself exclusively controlled and profited from
Bonham. Bennett testified that he did not own a home or a vehicle and did not have a bank account
but lived rent-free in a home owned by Bonham, drove Bonham vehicles, and “did whatever [he]
23
wanted to with the corporation bank account.” On this record, Bonham concedes that Bennett was
indisputably a vice-principal of Bonham. Instead, Bonham argues only that there is insufficient
evidence to support the jury’s finding that Bennett was acting in his capacity as a vice-principal of
Bonham when he maliciously prosecuted Grant.
In its brief, Bonham attempts to distinguish this case from Bennett I, in which the
Texas Supreme Court found there was “ample evidence” that Bennett was acting in his corporate
capacity when he converted Reynolds’ cattle using “corporate authority over corporate employees,
on corporate land, [and] using corporate equipment.” Id. at 885. Bonham argues in its brief that in
contrast to Bennett I, “the instant case does not involve the use of corporate property or the exercise
of corporate privileges to accomplish the underlying tort.” We conclude, however, that in this case
there is, again, more than ample evidence to impart corporate liability on Bonham.
Reviewing the record, Bennett’s malicious prosecution of Grant involved several
courses of conduct that implicate Bonham. First, Bennett contacted an attorney who had an ongoing
attorney-client relationship with Bonham and directed him to research whether Grant’s alleged
actions constituted a criminal offense. The attorney then drafted a brief based on his legal research
advocating that Grant be charged with attempted theft. The brief was sent to the Navarro district
attorney and described as a “catalyst” in the district attorney’s decision to bring the case before a
grand jury. This same attorney was also pivotal in later advising Bennett to seek the appointment
of a special prosecutor to the case and then drafted the petition accusing the Navarro County district
attorney of bias. The attorney testified at trial that he had an ongoing attorney-client relationship
24
with Bonham since 1982. When asked whether he had ever done any personal work for Bennett, the
attorney answered: “I don’t remember ever doing anything for Mr. Bennett except a will one time.”
Bennett’s malicious prosecution of Grant was further accomplished by traveling many
miles in a Bonham vehicle to meet with officials in four different counties to have Grant prosecuted.
Bennett testified at trial that he did not own a vehicle and acknowledged that he used Bonham
vehicles to accomplish this phase of the malicious prosecution. When asked whether he ever used
Bonham’s vehicles for personal use, Bennett responded “I don’t have much personal business.”
Bennett’s lack of personal business was further exemplified when he testified that he directed a
Bonham employee to type a transcript of his alleged secretly-taped conversation with Grant. He
then testified that he presented this typed transcript to law enforcement in his attempts to prosecute
Grant. The employee who typed the transcript served as Bonham’s corporate representative at trial.”13
Viewing the foregoing evidence in the light most favorable to the jury’s verdict, we
conclude there is more than a scintilla of evidence to support the jury’s finding that Bennett was
acting in his capacity as a vice-principal of Bonham when he maliciously prosecuted Grant.14 We
overrule Bonham’s individual issues on appeal.
13
We also note that the Navarro County district attorney testified that he had formed the
impression that Bennett was attempting to prosecute Grant in order to influence civil litigation
arising from this case. The jury further heard testimony that Grant was the “star witness” in the
Reynolds’ civil suit against both Bonham and Bennett, which eventually resulted in a $1 million
punitive damages award against Bonham.
14
The jury alternatively found that Bonham was liable for Bennett’s malicious prosecution
of Grant based on agency and reverse-piercing theories. We do not address Bonham’s challenges
to these findings, as we have already concluded there was sufficient evidence to impart corporate
liability on Bonham as a vice-principal.
25
DAMAGES
After finding Bennett and the Bonham Corporation maliciously prosecuted Grant,
the jury found Grant was entitled to the following damages: $5,000 in mental anguish damages;
$60,000 in attorneys’ fees incurred defending the malicious prosecution; $1 million in punitive
damages awarded against Bennett; and another $1 million in punitive damages awarded against the
Bonham Corporation. The trial court’s final judgment reduced the award of compensatory damages
to $10,703 but awarded Grant, in accordance with the jury’s verdict, $2 million in punitive damages.
Appellants challenge the entire award. We will begin by reviewing the compensatory damages
awarded to Grant, which are comprised of $5,000 for mental anguish damages and $5,703 in
attorneys’ fees.
A. Mental Anguish
Appellants first contend there is no evidence to support the trial court’s award of
$5,000 in mental anguish damages. Although Grant was indicted and arrested as a result of their
malicious prosecution, Appellants challenge the mental anguish damages contending there is
insufficient evidence Grant suffered the “high degree of mental pain and distress necessary for
compensable mental anguish.” To support an award of mental anguish damages, there must be both
evidence of the existence of compensable mental anguish damages and evidence to justify the
amount awarded. Hancock v. Variyam, 400 S.W.3d 59, 68 (Tex. 2013). Mental anguish is only
compensable if it causes a “substantial disruption in daily routine” or “a high degree of mental pain
and distress.” Id.; Parkway Co. v. Woodruff, 901 S.W.2d 434, 444 (Tex. 1995).
26
Regarding Grant’s mental anguish damages, Grant testified that—long before his
indictment—he “knew Bennett would come after [him]” for turning his photos over to the authorities.
Fearful “for [his] life and [his] family,” Grant testified he moved four times in an effort to keep his
family safe from Bennett. Each time he would move, however, Grant testified that Bennett would
show up at depositions with his tape recorder and pencil in hand to record Grant’s new address. At
one such deposition taken prior to his indictment, Grant testified that he heard Bennett avow that “he
would see me go to the penitentiary.” He further testified that he was aware of other instances when
Bennett “had seen that people went to prison” and believed Bennett was “fully capable of seeing that
[he] went to prison.” After hearing Bennett’s testimony that it was his goal to put him in prison,
Grant testified he was fearful to leave home and would lock himself in his house to protect his
family. When Grant was finally indicted, his lawyer informed him he had been charged with a
felony and was facing prison time. Grant and his mother then drove the three and half hours from
Coleman, Texas, where he lived, to Corsicana, Texas, where he had been indicted. Grant surrendered
himself to the authorities in Corsicana and was released that day on a surety bond posted by his
mother. For the next nine months, the charges remained pending against Grant. Grant testified that
he worried how his family would be taken care of if he went to prison and that he was afraid to leave
his family alone. He further testified that as a result of worrying about what Bennett was going to
do, “I would have bad headaches, weak stomach, couldn’t eat, couldn’t sleep.” Grant additionally
testified that the experience affected his mental state as he went from being “a happy-go-lucky”
person to feeling like a “completely different person” who struggled with self-esteem and distanced
himself from friends and family. Grant’s sister confirmed that she noticed a change in Grant’s
demeanor, testifying that her brother “just closed himself and sequestered himself from everyone.”
27
Based on the foregoing, we conclude there is sufficient evidence to support the jury’s
finding that Grant suffered the degree of mental pain and distress that will support an award of mental
anguish damages and that the award of $5,000 was well within the range supported by the evidence.
B. Attorneys’ Fees
When a defendant has caused attorneys’ fees to be incurred in defense of a criminal
charge which was maliciously prosecuted, attorneys’ fees in defending the prior criminal charge are
recoverable in the malicious prosecution suit as damages. See IBP, Inc. v. Klumpe, 101 S.W.3d 461,
478 (Tex. App.—Amarillo 2001, pet. denied). Here, Grant was charged with two felonies: attempted
bribery and tampering with a witness. In his pleadings and at trial, however, Grant sued for malicious
prosecution based on the attempted bribery charge only. With regard to recovering attorneys’ fees
for the malicious prosecution as damages, Grant’s attorney testified at trial that Grant incurred
$6,003.19 in attorneys’ fees for defending against both charges, but that 95% of the work—or
$5,703—would have been necessary for defending the attempted bribery charge alone. The jury,
however, found Grant incurred $60,000 in reasonable and necessary attorneys’ fees defending
against the malicious prosecution. The trial court, in accordance with Grant’s voluntary remittitur,
reduced this amount to $5,703 to conform to the evidence at trial. Appellants nevertheless contend
there is insufficient evidence to support the amount of attorneys’ fees awarded as damages.
Appellants do not challenge the reasonableness of the fees. Rather, they argue only
that a “reasonable fact-finder could not have . . . allocated 95 percent of the fees incurred on both
charges solely to attempted bribery.” We disagree. Submitting to the jury an attorney’s testimony
concerning the percentage of hours relating to specific claims—even a percentage a high as 95%—is
28
sufficient to satisfy a party’s burden to segregate its attorneys’ fees. See Tony Gullo Motors I, L.P.
v. Chapa, 212 S.W.3d 299, 314 (Tex. 2006) (“an opinion would have sufficed stating that, for
example, 95 percent of their drafting time would have been necessary even if there had been no
[non-recoverable] claim”). Further, to the extent attorneys’ fees “would have been incurred on a
recoverable claim alone, they are not disallowed simply because they do double service” with a
non-recoverable claim. See id. at 313. Grant’s indictments were based on the same facts and he
asserted the same defense of limitations to both charges. His attorney testified that the legal work
performed for both charges was essentially the same, as he drafted the same motions, conducted the
same discovery, and attended the same hearings and meetings for both charges. As such, the attorney
testified “that 95% of the work that was required on those two charges would’ve been necessary on
just the attempted bribery charge itself alone. . . . I would have done the same work on the attempted
bribery charge even if there hadn’t been the attempted tampering with a witness charge.” As there
was sufficient evidence that Grant would have incurred $5,703 in attorneys’ fees on the bribery
charge alone, we conclude there is sufficient evidence to support the damages award. Finding
sufficient evidence to support the award of actual damages, we overrule Appellants’ second issue
on appeal.
C. Exemplary Damages Cap
The Texas Civil Practice and Remedies Code limits the maximum amount of
exemplary damages a trial court can award. See Tex. Civ. Prac. & Rem. Code § 41.008(b). The cap,
however, does not apply when a plaintiff seeks recovery of exemplary damages based on certain
felony criminal conduct enumerated under the statute, i.e., cap-busting conduct. Id. § 41.008(c).
29
One such felony cap-busting exception—defined under Penal Code § 32.46—is when a person,
with the intent to defraud or harm any person, by deception causes another to sign or execute
any document affecting the pecuniary interest of any person in the amount of $1,500 or more.
Id. § 41.008(c)(11); see also Tex. Penal Code § 32.46. Here, the jury made a cap-busting finding
that the Appellants, with the intent to harm Grant, caused another by deception to sign or execute
his criminal indictment for attempted bribery, and the indictment affected Grant’s pecuniary interest
in the amount of $1,500 or more. Appellants contend there is legally insufficient evidence to support
this finding because: (1) an indictment is not a document affecting the pecuniary interest of any
person; and (2) there is no evidence Bennett caused anyone to sign the indictment.
1. Document Affecting Pecuniary Interest
Appellants first contend that indictments—as a matter of law—are not documents
that affect a defendant’s pecuniary interest, and therefore Grant cannot qualify for the cap-busting
exception. We are not persuaded by Appellants’ argument. The term “pecuniary interest” is not
defined by the statute; therefore, courts have defined the term using its common meaning of having a
“financial stake” in a matter. See Briones v. State, 76 S.W.3d 591, 595 (Tex. App.—Corpus Christi
2002, no pet.); Goldstein v. State, 803 S.W.2d 777, 791 (Tex. App.—Dallas 1991, pet. ref’d).
Therefore, the narrow question presented is whether there is legally sufficient evidence of Grant
having a financial stake in the grand jury’s indictment.
Appellants contend that Grant had no financial stake because indictments as a whole
are excluded from the class of documents that affect pecuniary interests because—unlike a “bank
draft, a promissory note, [or] a deed”—no monetary interest “flow[s] directly from the document.”
30
The statute, however, does not require the complainant to have a pecuniary interest in the document
itself. See Lewis v. State, No. 05-09-00299-CR, 2010 WL 4400515, at *4 (Tex. App.—Dallas Nov.
8, 2010, pet. ref’d) (not designated for publication). Rather, it requires only that the execution of
the document affect the pecuniary interest of any person. See Tex. Penal Code § 32.46. Further, a
complainant is not required under the statute to prove actual pecuniary loss. See Smith v. State, 681
S.W.2d 71, 75–76 (Tex. App.—Houston [14th Dist.] 1983), aff’d, 722 S.W.2d 408 (Tex. Crim. App.
1986) (offense complete when person causes another to execute document with intent to defraud
or harm; there is no requirement to prove resulting harm). Therefore, when a person purposely
uses deception to cause a court official to execute a document, the executed document may
affect pecuniary interests if it subjects a person to potential financial liability. See Fisher v. State,
803 S.W.2d 828, 830 (Tex. App.—Dallas 1991, pet. ref’d) (securing issuance of citation through
deception affected pecuniary interests as citation made defendant in suit potentially liable for
monetary damages); Woodley v. State, No. 08-00-00470-CR, 2003 WL 550298, at *6 (Tex.
App.—El Paso 2003, pet. ref’d) (mem. op.) (securing trial court’s execution of agreed judgment that
had been altered to add new defendant and increase amount of award affected pecuniary interests as
defendants faced potential liability under altered judgment).
Viewing the evidence in the light most favorable to the jury’s finding, we conclude
there is more than a scintilla of evidence that Grant’s pecuniary or financial interests were affected
by the indictment, which—on its face—required him to find a means to post a $10,000 bond or face
immediate and indefinite imprisonment. He then was required to obtain legal counsel to quash the
indictment, incurring an additional $5,703 in attorneys’ fees. Further, if convicted of the offense of
31
attempted bribery, Grant faced further potential liability as the offense carried a monetary penalty
of up to $10,000. See Tex. Penal Code §§ 12.34; 15.01; 36.02. Thus, we conclude there is legally
sufficient evidence Grant had a financial stake in the indictment, as the execution of the document
caused him both immediate financial liability and potential financial liability in the future.
2. Causation
Appellants next contend that Bennett cannot be the legal cause of Grant’s indictment
because (1) the causal link between Bennett’s actions and the indictment is too attenuated to
satisfy causation requirements under the Penal Code; and (2) it is impossible to prove causation
because “grand jury proceedings are secret, so there is no way of knowing which evidence
persuaded the grand jury to indict.” Criminal liability is predicated on but-for causation but also
requires consideration of the foreseeability of the injurious consequences of the defendant’s conduct.
Williams v. State, 235 S.W.3d 742, 764–65 (Tex. Crim. App. 2007). Appellants, relying on the
Texas Court of Criminal Appeals’ discussion of causation in Williams v. State, argue the chain of
causation linking Bennett to the indictment is too attenuated to impose criminal responsibility. In
Williams, the Court found that a mother who left her two daughters in a room with a lit candle under
another adult’s supervision was not criminally responsible for the children’s burning deaths because
it was not reasonably foreseeable: (1) that the other adult would forget to blow the candle out before
falling asleep; (2) that a sheet or clothing would then fall on the burning candle; and (3) that the
other adult would not be able to get children out of the house after the fire started. Id. In this excerpt
from their brief, Appellants argue the following is the but-for causal chain linking Bennett to
Grant’s indictment in this case:
32
• If Bennett had not asked for a special prosecutor, and
• If Bennett had not given the prosecutor the facts he had gathered, and
• If the prosecutor had not brought the case to the grand jury, and possibly,
• If the prosecutor had not presented those facts, and, possibly,
• If the grand jury had not relied on those facts, and
• If the prosecutor had not recommended an indictment or the grand jury had not
disregarded the prosecutor’s recommendation, and
• If at least nine of the grand jurors had not voted to issue the indictment,
• Then Grant never would have been indicted.
Appellants then argue this causal chain is similar to Williams because it “is too disconnected from
the putative cause to support any finding” of causation. What Appellants fail to account for, however,
is that the Court in Williams found that causal link insufficient because the events leading to the
children’s deaths were “not reasonably foreseeable.” Id. at 765 (emphasis added). The facts of
this case are much different. The evidence in this case reflects that Bennett set out on a course of
conduct to have Grant indicted and was successful in that endeavor. Indeed, Appellants do not
contest the jury’s finding that Bennett intended to harm Grant by causing the grand jury to sign his
indictment. It is reasonably foreseeable that if Bennett intended to put Grant in prison, then provided
evidence that a reasonable juror could infer was fabricated or manipulated, and then led a campaign
to have a special prosecutor appointed in the case—all of which is more than adequately supported
by the record—the end result of these efforts would be Grant’s indictment. It is abundantly apparent
that Grant’s indictment was the natural, probable and foreseeable consequence of Bennett’s actions.
33
Appellants next contend that “Grant could not have sustained his burden to prove
causation because it is impossible to show that Bennett’s conduct was necessary for the indictment
to issue [given that] grand jury proceedings are secret.” First, as we have already discussed, there
was sufficient evidence that but for Bennett’s aggressive and untoward efforts to improperly
influence the criminal justice system, the case would have never been put before the grand jury,
not once, but twice. Further, Bennett does not dispute the jury’s finding that he used deception to
cause the grand jury to execute the indictment. Deception is defined, as “creating or confirming by
words or conduct a false impression of law or fact that is likely to affect the judgment of another
in the transaction, and that the actor does not believe is true.” Tex. Penal Code §§ 31.01(1)(A),
32.46(d)(1). Here, the special prosecutor testified candidly that he had the following evidence
from Bennett—at the time he presented the indictments—from which the jury found Bennett used
deception to create a false impression that was likely to affect the judgment of another: Bennett’s
statements that Grant had called trying to sell him incriminating photos for $5,000 and a transcript
from Bennett—which the jury could have found was fraudulent—purportedly transcribing a secretly-
taped conversation with Grant that substantiated Bennett’s claim that Grant had sought $5,000 for
the photos. The record further reflects that Bennett testified at the grand jury proceeding but that
Grant was not present. In exact accordance with Bennett’s evidence, the grand jury’s indictment
charges that Grant “with the specific intent to commit the offense of bribery, called [Bennett], with
the purpose of soliciting a bribe of $5,000.”
Under the Penal Code, “a person is criminally responsible if the result would not
have occurred but for his conduct, operating either alone or concurrently with another cause,
34
unless the concurrent cause was clearly sufficient to produce the result and the conduct of the actor
clearly insufficient.” Tex. Penal Code § 6.04. Here, Appellants do not challenge the jury’s finding
that Bennett used deception to indict Grant, and the allegations in the indictment identically mirror
the evidence provided by Bennett. Under this record, viewed in the light most favorable to the jury’s
finding of causation, there is more than a scintilla of evidence in the record that Bennett’s conduct
alone was sufficient to have caused the indictment and to incur criminal responsibility. See id.
Having found sufficient evidence to support the jury’s cap-busting finding, we overrule Appellants’
third issue on appeal.
D. Constitutionality of Exemplary Damages
Appellants lastly attack the award of exemplary damages, contending the dual
$1 million exemplary damages awards against Bennett and the Bonham Corporation violate their
federal substantive due process rights. While state law governs the amount properly awarded as
exemplary damages, that amount is also subject to an ultimate federal constitutional check for
exorbitancy. Tony Gullo Motors I, 212 S.W.3d at 307. This is because the Due Process Clause of
the Fourteenth Amendment prohibits a state from imposing a “grossly excessive” punishment on a
tortfeasor. BMW of N. Am., Inc. v. Gore, 517 U.S. 559, 562 (1996). But punitive damages “may
properly be imposed to further a State’s legitimate interests in punishing unlawful conduct and
deterring its repetition,” and “States necessarily have considerable flexibility in determining the
level of punitive damages that they will allow in different classes of cases and in any particular case.”
Id. at 568. “Only when an award can be categorized as grossly excessive in relation to these interests
does it enter the zone of arbitrariness that violates” due process. Id.
35
In this case, the State has a legitimate interest in both punishing individuals who
purposely manipulate the legal system to imprison innocent persons and in deterring its repetition.
We must therefore determine whether the punitive damages award in this case was grossly excessive
in relation to these interests. See id. In determining whether an award is excessive, the United States
Supreme Court has identified three “guideposts” by which we must assess the constitutionality of
the punitive damages award:
1. the degree of reprehensibility of the defendant’s misconduct;
2. the disparity between the actual or potential harm suffered by the plaintiff and
the punitive damages award; and
3. the difference between the punitive damages awarded by the jury and the civil
penalties authorized or imposed in comparable cases.
State Farm Mut. Auto. Ins. Co. v. Campbell, 538 U.S. 408, 418 (2003); see also Bennett I, 315 S.W.3d
at 873. Whether a punitive damages award passes constitutional muster under this standard is a
question of law that we review de novo. Bunton v. Bentley, 153 S.W.3d 50, 54 (Tex. 2004).
1. Reprehensibility of Bennett’s Misconduct
The first guidepost, the degree of reprehensibility of the defendant’s misconduct,
focuses on the “enormity” of the misconduct and is “the most important indicium of the reasonableness
of a punitive damages award.” BMW of N. Am., 517 U.S. at 575. Punitive damages are not
compensation for injury; rather, they operate as private fines intended to punish the defendant and
to deter future wrongdoing. Cooper Indus., Inc. v. Leatherman Tool Grp., Inc., 532 U.S.424, 432
(2001). Exemplary damages should therefore reflect the “enormity of [the] offense.” BMW of N. Am.,
36
517 U.S. at 575. In evaluating the enormity of a person’s misconduct, we consider five nonexclusive
factors— whether:
1. The harm inflicted was physical rather than economic;
2. The tortious conduct showed an indifference to or reckless disregard for the
health or safety of others;
3. The target of the conduct had financial vulnerability;
4. The conduct involved repeated actions, not just an isolated incident; and
5. The harm resulted from intentional malice, trickery, or deceit, as opposed to
mere accident.
State Farm Mut. Auto. Ins., 538 U.S. at 419. One of these reprehensibility factors alone “may
not be sufficient to sustain a punitive damages award; and the absence of all of them renders any
award suspect.” Id.
a. Harm resulted from intentional malice, trickery or deceit.
Appellants concede there is evidence that Grant’s indictment resulted from “intentional
malice, trickery, or deceit” but argue that none of the other factors weigh in favor of punitive
damages. We certainly agree with Appellants that the fifth reprehensibility factor weighs in favor
of punitive damages. The jury heard evidence that Bennett’s goal was to put Grant in prison to settle
a personal vendetta and to influence pending civil litigation, and that he set out on a campaign of
legal thuggery—including allegations of lying, tailoring evidence, and even outright fabrication of
evidence—to ensure that Grant was imprisoned. When Bennett could not win at this game, the
37
record reflects he decided to change the playing field by exerting political pressure on a district
attorney to appoint his own hand-picked special prosecutor to the case.
Further, when considering exemplary damages, we may examine Bennett’s misconduct
beyond the malicious prosecution itself when it “demonstrates the deliberateness and culpability”
of his actions and bears “a nexus to the specific harm suffered” by Grant. Bennett I, 315 S.W.3d
at 875. Here, Bennett’s efforts to manipulate the legal system to imprison Grant were part of a
larger escapade designed to thwart justice and abuse the court system. We conclude the following
allegations of malfeasance may properly inform the reprehensibility analysis, as they demonstrate
the deliberateness, culpability, and motive behind Bennett’s actions and relate back to the underlying
malicious prosecution:
Urging Grant to Lie and Attempting to Bribe Him. Grant testified that, prior to turning his
photos over to the authorities, Bennett visited his home and urged him to lie about what he had seen.
Grant’s sister testified that Bennett then attempted to offer Grant a lucrative job under the guise of
helping his family after a car accident. She testified Bennett offered that if Grant “can come and help
him for a couple of days, he had a job that he can get $4,000 for . . . a couple of days of work.”
When Grant had worked for Bennett the previous year, his salary was $1,100 a month. At the time
Bennett offered this money, Grant was posed to be the star witness testifying against Bennett in his
criminal trial for cattle theft and in Reynolds’ civil suit.
Threatening Grant. When money was not enough to persuade Grant, there was evidence at
trial that Bennett then tried a new tactic to silence Grant. Grant’s sister testified that Bennett called
her more than 15 times trying to obtain Grant’s new contact information. Frustrated that Bennett
would not stop calling, the sister provided Bennett with her husband’s cell phone number and
said it was Grant’s number. Bennett testified that he then asked Rogers to call the number. Shortly
thereafter, Rogers called the number and reached Grant’s brother-in-law. Believing he was speaking
to Grant, Rogers then—according to the brother-in-law—demanded that Grant turn over the pictures
and threatened “if he didn’t get the pictures, that he had a jake-leg lawyer that would obtain them”
and “that he was going to take care of [Grant] one way or the other.” The brother-in-law testified
that he relayed these threats to Grant.
Litigation Against Grant. Being unsuccessful in silencing Grant, Bennett then filed this suit
alleging Grant had slandered him by saying that he had stolen Reynolds’ cattle and sought $50,000
38
in damages. The jury found against Bennett on his slander claim, finding that Grant’s statement that
Bennett had stolen from Reynolds was substantially true. In addition to this suit, Bennett filed—the
day after Grant’s criminal record was expunged—a second civil lawsuit against Grant and others
alleging they had conspired to have him indicted for cattle theft. Bennett sought $2 million dollars
in compensatory damages, in addition to punitive damages, in that suit.15
Pressuring Grant’s Attorney to Resign. During the course of this litigation, Bennett filed two
grievances against Grant’s attorney that were dismissed as not alleging professional misconduct. In
addition to the grievances, Bennett sued Grant’s lawyer, contending he had conspired with Grant and
others to have him indicted for cattle theft. The attorney testified that after he was sued by Bennett
for $2 million, he was “angry” and “scared” and decided to no longer represent Grant in this suit
because “he couldn’t do as good a job as somebody that wasn’t being sued themselves.”
Tampering With Evidence. At trial, there were allegations that one of the photos Grant had
taken depicted Reynolds’ brand on the sold cattle. There were further allegations that Bennett had
doctored this photo during his criminal trial to change the incriminating image of his neighbor’s
brand and conceal his theft. In addition, the San Saba District and County Clerk testified that
Bennett attempted to register Reynolds’ brand as his own. Finally, during the course of this trial,
Bennett—outside the presence of the jury and without permission from the trial court—altered an
exhibit depicting a hand-drawn diagram of Reynolds’ brand. We conclude these cover-up efforts show
culpability and deliberateness and sought to extend and exacerbate harm to Grant by discrediting
him as a witness and bolstering Bennett’s claims in his civil lawsuits against Grant.16
b. Harm inflicted was not merely an economic injury and showed a reckless
disregard for Grant’s health and safety.
Regarding the first and second reprehensibility factors, Appellants argue Grant
suffered a purely economic injury and this is not a case involving physical harm warranting a
greater award of exemplary damages, and that his actions do not show an indifference to or
15
Grant, Reynolds, and Miller obtained a favorable summary judgment and sanctions against
Bennett, Bonham, and their attorney in that suit, which is currently pending on appeal before this
Court in Bennett, Bonham & Paris v. Reynolds, No. 03-12-00568.
16
An award of punitive damages for some of these actions has already been awarded against
Bennett in Bennett I. See Bennett I, 315 S.W.3d at 876. In that suit, however, he was punished for
how his actions affected Reynolds. In this suit, the award of punitive damages is to punish Bennett
for how these actions affected Grant. See id.
39
reckless disregard for Grant’s health or safety. We disagree. Malicious prosecution is not a purely
economic injury; rather, the Restatement recognizes that a plaintiff may recover for the physical
harm caused by reason of his arrest. See Restatement (Second) of Torts § 671 (1977). Here, Bennett
did not intend to inflict a mere financial injury on Grant; rather, he succeeded in having Grant’s
actual person seized, held in captivity, and stripped of personal liberties. Appellants further contend
that: “Bennett’s mere desire that Grant serve prison time does not equate to indifference or reckless
disregard for Grant’s health or safety. . . . At best, this factor is neutral and therefore carries no
weight in the reprehensibility analysis.” We are confident that if Bennett himself or any person
were arrested and facing a prison sentence in Texas, he would not view his health and safety
neutrally affected. See also id. (maliciously prosecuted plaintiff may recover for impairment to
health sustained from arrest).
c. Target of the conduct had financial vulnerability.
Regarding the third reprehensibility factor, we note that Bennett’s actions were further
reprehensible because Bennett was aware that Grant and his family were financially vulnerable.
Grant testified he first met Bennett because he was desperate for work, and Bennett agreed to hire
him as a hand. During the time Grant worked for Bennett, the Bonham Corporation paid him a
salary of $1,100 for a full month of work and allowed him to live in a trailer on the property. A
salary of $13,200 a year, even when the housing allowance is considered, was hovering on the
federal poverty line.17 Further, Grant’s financial situation worsened when his wife and baby were
17
Pursuant to federal poverty guidelines in 2001, a person with two dependents was poverty-
stricken if his annual income was less than $14,630. See http://aspe.hhs.gov/poverty/01poverty.htm.
40
in a major traffic accident shortly after Grant turned his photos over to the authorities. Grant and
others testified that both his wife and baby were hospitalized after the accident, that his wife had
been permanently injured, and that Grant had to take a significant amount of time off from work to
stay home and care for her. The record reflects that Bennett was fully aware of the car accident and
perhaps attempted to use the situation to take advantage of Grant’s financial vulnerability by offering
him an extremely lucrative job immediately after the accident under the guise of helping Grant’s
family. Amidst this backdrop of financial vulnerability, Bennett then began his quest to have Grant
imprisoned and ultimately indicted. Further, Grant’s indictment carried a prison sentence of two to
ten years’ imprisonment. See Tex. Penal Code §§ 12.34, 15.01, 36.02. Undoubtedly, Bennett’s
actions threatened to financially ruin Grant and his family.
In sum, we conclude four of the five reprehensibility factors are present in this case
and weigh in favor of punitive damages: (1) the harm to Grant resulted from intentional malice,
trickery, or deceit; (2) Bennett’s malicious prosecution of Grant was not merely an economic injury
but resulted in a seizure of Grant’s person and loss of physical liberties; (3) Bennett’s tortious
conduct showed an indifference to and reckless disregard for Grant’s health and safety; (4) and his
actions threatened to financially ruin Grant. Thus, all but one of the reprehensibility factors weigh
in favor of exemplary damages.18
18
The remaining reprehensibility factor is whether the defendant’s conduct involved repeated
actions, not just an isolated incident. For purposes of the reprehensibility analysis, the Texas Supreme
Court has found that this factor refers to recidivism and not a course of conduct resulting in a single
injury. See Bennett I, 315 S.W.3d at 878 n.55. Here, Grant alleges Bennett engaged in a course of
conduct resulting in a single injury—his indictment for attempted bribery. There is no evidence in
the record that Bennett had engaged in other acts of malicious prosecution demonstrating recidivism.
41
2. Ratio Between Exemplary and Compensatory Damages
The second and perhaps most commonly cited indicium of an excessive punitive
damages award is the ratio between the punitive damages awarded and the actual or potential harm
inflicted on the plaintiff. See BMW of N. Am., 517 U.S. at 580. In analyzing this ratio, “the proper
inquiry is ‘whether there is a reasonable relationship between the punitive damages award and the
harm likely to result from the defendant’s conduct as well as the harm that actually has occurred.’”
Id. at 581 (quoting TXO Prod. Corp. v. Alliance Res. Corp., 509 U.S. 443, 460 (1993) (emphasis in
original)). Thus, we are to examine the difference between the punitive damages award and the harm
actually suffered and the harm “that would have ensued if the tortious plan had succeeded.” See id.;
see also TXO Prod., 509 U.S. at 460. While there is not “a mathematical bright line between the
constitutionally acceptable and constitutionally unacceptable [award of exemplary damages] that
would fit every case,” see Pacific Mut. Life Ins. Co. v. Haslip, 499 U.S. 1, 18 (1991), we have been
instructed that “few awards exceeding a single-digit ratio . . . will satisfy due process” and that an
“award of more than four times the amount of compensatory damages might be close to the line of
constitutional impropriety.” State Farm Mut. Auto. Ins., 538 U.S. at 425.
Appellants contend that there is no meaningful distinction between this case and the
large punitive damages award the Texas Supreme Court overturned in Bennett I, in which the Court
found that the ratio of $5,327.11 in actual damages compared to the $250,000 in exemplary damages
awarded against Bennett—a ratio of 47:1—and the $1 million exemplary damages awarded against
Bonham—a ratio of 188:1—violated due process. See Bennett I, 315 S.W.3d at 869. As the U.S.
Supreme Court has recognized, however, “a jury imposing a punitive damages award must make a
42
qualitative assessment based on a host of facts and circumstances unique to the particular case before
it. Because no two cases are truly identical, meaningful comparisons of such awards are difficult to
make.” TXO Prod., 509 U.S. at 458. While this case and Bennett I share some nucleus of operative
facts, the present case is distinguishable and therefore must be examined on its own facts. In Bennett
I, the jury found Bennett converted thirteen of his neighbor’s cattle and assessed actual damages at
the market value of the cattle, $5,327.11. Bennett I, 315 S.W.3d at 871. While the Court found that
Bennett’s malfeasance in attempting to cover-up his initial conversion showed heightened
reprehensibility, it concluded:
At heart, though, this is an economic-injury, actual-harm case seeking
recovery for the conversion of thirteen head of cattle. Reynolds alleges a broader
“criminal escapade” that aimed to ruin him, but the theoretical possibilities of greater
harm strike as marginally relevant at best in assessing exemplary damages, absent
proof of the likelihood of such harms.
Id. at 877.
In striking contrast, Bennett in this case did not merely steal cattle; rather, he
attempted to deprive a man of two to ten years of his liberty. See Tex. Penal Code §§ 12.34, 15.01,
36.02 (sentencing for offense of attempted bribery). While Appellants attempt to equate theft of
cattle to the theft of years from a man’s life, there is no comparison between the two acts. This is
reflected in the reprehensibility analysis, in which we concluded that four of the five reprehensibility
factors were present in this case. In contrast, in Bennett I, the Texas Supreme Court found that
Bennett inflicted a purely economic injury on his neighbor by stealing his cattle and therefore
only one of the reprehensibility factors—the harm resulted from intentional malice, trickery, or
deceit—was present. See Bennett I, 315 S.W.3d at 877.
43
Further, and perhaps most important for our discussion, the Texas Supreme Court
found that Bennett I was an actual-harm case only—meaning that beyond the actual harm suffered
by Reynolds from the theft of his cattle, there was only marginal evidence of any other potential
harm faced by Reynolds or anyone else as a result of Bennett’s conversion. Id. Therefore, in
Bennett I, potential harm was not relevant in the Court’s ratio analysis. See id. But in this case, the
evidence of potential harm is not marginal or speculative; rather, the record conclusively shows that
Grant would have been imprisoned for two to ten years if Bennett had succeeded in his illicit
scheme. See Tex. Penal Code §§ 12.34, 15.01, 36.02. In analyzing the exemplary damages ratio in a
potential-harm case, the U.S. Supreme Court has unequivocally instructed us that “[i]t is appropriate
to consider the magnitude of the potential harm that the defendant’s conduct would have caused to
its intended victim if the wrongful plan had succeeded.” TXO Prod., 509 U.S. at 460 (emphasis in
original) (holding dramatic disparity between $19,000 compensatory damages award compared to
$10 million exemplary damages award did not violate due process “in light of the [millions]
potentially at stake” if the defendant “had succeeded in its illicit scheme”). Thus, U.S. Supreme Court
precedent requires us to compare the exemplary damages awarded in this case to both “the harm
that has actually occurred” and the potential harm that Grant would have sustained if Bennett’s
“wrongful plan had succeeded.” See id.; see also BMW of N. Am., 517 U.S. at 581 (“the proper
inquiry is whether there is a reasonable relationship between the punitive damages award and the
harm likely to result from the defendant’s conduct as well as the harm that actually has occurred”).
Appellants stress in their brief the disparity between the dual $1 million punitive
damages awarded in this case compared to the $10,703 compensatory damages award. That disparity
44
lessens, however, when we consider the potential prison sentence faced by Grant. Although it is
difficult to place a monetary value on the loss a person experiences from losing years of his life to
an erroneous prison sentence, the State compensates persons who have been wrongfully convicted
to the tune of $80,000 for each year of wrongful imprisonment plus lifetime annuity payments.
See Tex. Civ. Prac. & Rem. Code §§ 103.052 (Lump-Sum Compensation), 103.053 (Annuity
Compensation). Thus, if Grant had been wrongfully imprisoned for the minimum sentence of two
years’ imprisonment, he would have been entitled at a bare minimum to a lump-sum payment of
$160,000.19 And, on the high end of the spectrum, he would have been entitled to a lump-sum
payment of $800,000 for serving the maximum ten-year sentence, plus potential lifetime annuity
payments which could potentially push the final award to over $1 million.20 Although there is no
way to precisely put a dollar value on the potential harm in this case, the State’s restitution payments
reflect the value the Legislature has placed on a year of life lost to wrongful imprisonment and
provide a guidepost for the potential damages in this case.
Based on this analysis, we conclude the potential damages in this case can be
prudently and rationally valued at a minimum of $160,000. This is the minimum amount Grant
would have received from the State if he had been wrongfully convicted of attempted bribery and
served the minimum sentence available. When combined with the actual damages, the total actual
19
Annuity payments would not begin until the first anniversary of this lump-sum payment
and would be awarded only if Grant was still living on that date. See Tex. Civ. Prac. & Rem. Code
§§ 103.151(b), 103.154(b).
20
The annuity payments are somewhat speculative as they are determined by the number
of years a person survives after release from prison. See id. § 103.154(b). Unlike the lump-sum
compensation, the annuity payments do not transfer upon death to the person’s estate. See id.
§§ 103.151(a), 103.154(b).
45
and potential damages for this case would therefore be at least $170,703. Using these figures, the
ratio between the actual and potential harm compared to the dual $1 million exemplary damages
awards would be over 5:1 for both Bennett and Bonham. See BMW of N. Am., 517 U.S. at 581 (“the
proper inquiry is whether there is a reasonable relationship between the punitive damages award and
the harm likely to result from the defendant’s conduct as well as the harm that actually has
occurred”). We note that—even with careful consideration of both the actual and potential damages
in this case—this ratio likely exceeds constitutional limits. See State Farm Mut. Auto. Ins., 538 U.S.
at 425 (“award of more than four times the amount of compensatory damages might be close to the
line of constitutional impropriety”). As such, this guidepost weighs in favor of reducing the punitive
damages award.
3. Legislative Penalties for Similar Misconduct
The final guidepost compares the exemplary damages with legislatively authorized
civil penalties in comparable cases. This factor fortifies the notion that legislatures make policy and
are well positioned to define and deter undesired behavior. Bennett I, 315 S.W.3d at 880. Here, we
note there is no comparable civil penalty for Bennett’s conduct. We may, however, also look to
criminal penalties that could be imposed, as “the existence of a criminal penalty does have bearing
on the seriousness with which a State views the wrongful action.” State Farm Mut. Auto. Ins., 538
U.S. at 428. When used to determine the dollar amount of an exemplary damages award, though,
the U.S. Supreme Court has cautioned us that criminal penalties have “less utility” than
civil penalties. See id.; see also Bennett I, 315 S.W.3d at 881. In this case, we conclude criminal
46
penalties have some relevance to our discussion, as they demonstrate that Bennett had fair notice that
his conduct could subject him to the following punishment:
• Tampering With or Fabricating Physical Evidence
• 2 to 10 Year Prison Sentence
• $10,000 fine
• Aggravated Perjury Before Grand Jury
• 2 to 10 Year Prison Sentence
• $10,000 fine
• Execution of a Document by Deception
• 180 days to 2 years in State Jail
• $10,000 fine
• Making a False Report to Peace Officer or Law Enforcement Employee
• Up to 180 Days in State Jail
• $2,000 fine
• $16,000 fine for committing offense eight times21
Thus, Bennett had fair notice of the seriousness with which the State viewed his wrongful conduct,
as his actions could subject him to up to $46,000 in monetary fines and four to twenty-two
years’ incarceration.22
Appellants contend in their brief that we should—as we did on remand from
Bennett I—reduce the exemplary damages award to the comparable criminal fines. In that case, we
21
Bennett acknowledged at trial that, in his efforts to prosecute Grant, he spoke with at least
eight different law enforcement officials on separate occasions.
22
See Tex. Penal Code §§ 32.46 (execution of document by deception), 38.03 (aggravated
perjury), 37.09 (evidence tampering), 37.08 (false report).
47
concluded that the criminal monetary sanction for cattle theft was comparable to the civil offense
of conversion and provided an objective basis for setting a constitutionally permissible exemplary
damages award. Bennett v. Reynolds, No. 03-05-00034-CV, 2010 WL 4670270, at *5 (Tex.
App.—Austin Nov. 18, 2010, no pet.) (mem. op.) supplemented, 03-05-00034-CV, 2011 WL 182876
(Tex. App.—Austin Jan. 19, 2011, no pet.). In this case, however, there simply is no criminal offense
comparable to the civil offense of malicious prosecution. While we can examine specific criminal
actions Bennett took in his ultimate effort to maliciously prosecute Grant, none of these offenses take
into account that Bennett’s ultimate goal was to put Grant in prison.23 We do, however, conclude
that under this record the applicable prison sentences and fines put Bennett on notice that the State
has a significant interest in deterring this type of conduct and would prosecute and imprison those
who attempt to manipulate the criminal justice system for personal gain.
After careful analysis of these three guideposts, we conclude: (1) four of the five
reprehensibility factors weigh in favor of punitive damages; (2) potential harm is relevant in
evaluating the ratio to exemplary damages, but that even when we consider potential harm, the
resulting ratio of 5:1 likely exceeds constitutional boundaries; and (3) there are no comparable
civil sanctions, but Bennett was on notice that the State had a significant interest in protecting the
23
In truth, for most cases the monetary criminal penalties under the Texas Penal Code have
little utility in determining the dollar value of an exemplary damages award. See State Farm Mut.
Auto. Ins. Co. v. Campbell, 538 U.S. 408, 428 (2003). The monetary penalty for all felonies in Texas,
except for capital felony offenses which do not carry any monetary penalty, is a fine not to exceed
$10,000. Tex. Penal Code §§ 12.31–.35. There is no variance in the amount of the fine to account
for the State’s varied interests in preventing and punishing various degrees of reprehensible felony
conduct.
48
integrity of the criminal justice system and would vigorously prosecute, fine, and imprison persons
who engaged in such behavior.
Our remaining task is to determine—under the unique facts of this case and these
guideposts—what amount of exemplary damages would pass constitutional muster. In this regard,
we have been instructed that an award “four times the amount of compensatory damages might
be close to the line of constitutional impropriety” and that “[p]ushing exemplary damages to the
absolute constitutional limit in a case like this leaves no room for greater punishment in cases
involving death, grievous physical injury, financial ruin, or actions that endanger a large segment of
the public.” Tony Gullo Motors I, 212 S.W.3d at 308–310. While we find Bennett’s conduct
abhorrent, we recognize that his actions did not actually cause any of these enumerated unfortunate
circumstances. We do, however, also recognize that the State has a significant interest in punishing
and deterring this type of conduct and that Bennett’s actions were particularly reprehensible.
Weighing these competing concerns, we conclude that a ratio of 3:1 exemplary damages compared
to the combined actual and potential damages passes constitutional muster. This results in an award
of $512,109 against each defendant (three times the actual and potential damages of $170,703) and
reduces the total punitive damages award from $2 million to $1,024,218 ($512,109 against Bonham
and $512,109 against Bennett).24 This award recognizes the potential harm caused by Bennett and
24
When corporate liability is warranted based on the actions of a vice-principal, the Texas
Supreme Court has affirmed the propriety of awarding exemplary damages against both the individual
vice-principal and his employer. See Bennett I, 315 S.W.3d at 869 (affirming exemplary damages
awarded against both individual who was corporate principal and corporation itself but remanding
because awards were excessive under due process); see also Qualicare of E. Tex., Inc. v. Runnels,
863 S.W.2d 220, 224 (Eastland 1993—no writ.) (award of exemplary damages against both employer
and vice-principal “is proper and does not impose a double punishment”).
49
Bonham, their reprehensibility, and the State’s interest in punishing and deterring, but also leaves
room for greater punishment for cases with more egregious injuries.
SANCTIONS
In addition to the actual and exemplary damages at issue in this suit, Grant alleged
Bennett’s slander claim against him was frivolous and brought in bad faith for purposes of harassment
and sought sanctions. See Tex. Civ. Prac. & Rem. Code § 10.001; Tex. R. Civ. P. 13. Bennett
originally initiated this suit—as discussed previously—by suing Grant for slander, alleging that
Grant’s statement that Bennett had stolen Reynolds’ cattle was slanderous. The jury found that
Grant’s statement was substantially true and this finding has not been challenged on appeal. The
trial court granted the request for sanctions and ordered Bennett to pay Grant’s attorneys’ fees
incurred defending the claim in the amount of $269,644.50, concluding that this amount adequately
punished Bennett and fairly compensated Grant for defending against the groundless claim. In his
only individual issue, Bennett contends the sanctions award was an abuse of discretion.
We review the trial court’s imposition of sanctions for an abuse of discretion.
See Low v. Henry, 221 S.W.3d 609, 614 (Tex. 2007). In reviewing the sanctions order, we review
the entire record to determine whether the trial court abused its discretion. American Flood Research,
Inc. v. Jones, 192 S.W.3d 581, 583 (Tex. 2006). An appellate court may reverse the trial court’s
ruling only if the trial court acted without reference to any guiding rules and principles, such that its
ruling was arbitrary or unreasonable. Low, 221 S.W.3d at 614. At the very least, this requires a
showing that the trial court based its order on an incorrect interpretation of the law or a clearly
erroneous assessment of the evidence. Robson v. Gilbreath, 267 S.W.3d 401, 405 (Tex. App.—Austin
50
2008, pet. denied). The trial court does not abuse its discretion if it bases its sanctions on conflicting
evidence and some evidence supports its decision. Unifund CCR Partners v. Villa, 299 S.W.3d 92,
97 (Tex. 2009).
Here, the trial court’s order did not specify the legal basis for the sanctions, so we
begin our review by identifying all the potential legal bases for the order. See Citibank, N.A. v. Estes,
385 S.W.3d 671, 675 (Tex. App.—Houston [14th Dist.] 2012, no pet.). Chapter 10 of the Civil
Practice and Remedies Code, in pertinent part, authorizes a court to sanction a person, a party
who represents the person, or both for signing a pleading that was brought for any improper
purpose—including to harass, cause unnecessary delay, or needlessly increase the cost of litigation.
Tex. Civ. Prac. & Rem. Code §§ 10.001, 10.004; see Mattox v. Grimes Cnty. Comm’rs Court,
305 S.W.3d 375, 386 (Tex. App.—Houston [14th Dist.] 2010, pet. denied) (“Sanctions under
chapter 10 of the Civil Practice and Remedies Code are authorized if the evidence establishes that
. . . a pleading or motion was brought for an improper purpose.”). Here, the trial court’s order
concludes that Bennett filed his slander claim for at least two improper purposes—“to punish
a witness who had testified against him in previous lawsuits” and “to subvert a separate trial,
[Bennett I].” The trial court further concluded that Bennett’s refusal to nonsuit his slander claim,
“substantially increased the burden on this case on the defendant and on the court system” and
“required in essence a re-trial of [Bennett I].” As the trial court made findings that Bennett filed
this suit for improper purposes specifically prohibited by Chapter 10, we conclude the trial court
could have relied on Chapter 10 as the legal basis for the award. Further, Bennett has not challenged
on appeal the trial court’s finding that he filed this suit against Grant for improper purposes.
51
Generally, an appellant must attack all independent bases or grounds that fully support a complained-
of ruling or judgment. See Britton , 95 S.W.3d at 681. As Bennett has failed to attack this basis that
supports the sanctions order, we cannot conclude the trial court’s imposition of sanctions was an
abuse of discretion.
In addition, Rule 13 similarly authorizes a trial court to sanction a person, a
represented party, or both for signing a pleading that is groundless and brought in bad faith or to
harass. Tex. R. Civ. P. 13. Pleadings are presumed filed in good faith under Rule 13, and the burden
is on the moving party to demonstrate both that the opposing party’s filings: (1) are groundless;
and (2) were filed either in bad faith or for the purpose of harassment. Id. In determining whether
sanctions are appropriate, the trial court must examine the facts available to the litigant and the
circumstances existing when the litigant filed the pleading. Robson, 267 S.W.3d at 409. Further,
under Rule 13, the trial court is required to state in the order the particulars of good cause justifying
the sanctions. See Tex. R. Civ. P. 13.
The trial court’s order here concludes, consistent with a violation of Rule 13, that
Bennett’s slander claim was “groundless,” “part of a plan to harass and intimidate Grant,” and
brought in “bad faith.”25 As such, we conclude that Rule 13 could have also been the legal basis for
the trial court’s award. Further, the sanctions order states the particulars of good cause justifying
sanctions under Rule 13. First, there are numerous findings in the order that Bennett brought this
25
The trial court also submitted this question to the jury, which concluded that Bennett’s
suit was groundless and brought in bad faith or for the purpose of harassment. Bennett contends the
trial court erred in submitting the sanctions issue to the jury because it was a question of law.
Regardless, the sanctions order indicates the trial court made its own findings to support the
sanctions order separate from the jury’s findings.
52
suit in bad faith and for purposes of harassment, including findings that: (1) Bennett had filed this
suit to punish Grant for testifying against him in previous lawsuits; (2) Bennett had “doctored” or
“altered” evidence to cover up his conversion of Reynolds’ cattle and give grounds to his baseless
slander claim against Grant; (3) and that Bennett’s true purpose in the suit was not to recover money
damages from Grant—who lacked the financial resources to pay an award—but to subvert a separate
civil trial, Bennett I, and to harass Grant. Bennett does not challenge the legal sufficiency of any of
these findings on appeal.
With regard to groundlessness, Bennett pleaded that he had instructed Grant not to
sell any cattle that did not belong to him, and therefore, Grant’s allegation that he had stolen the
cattle was slander. The trial court, however, found in its order that Bennett had converted Reynolds’
cattle and then engaged in a “design to cover up his conversion” that implied “willfulness and bad
faith, not inadvertence or an honest mistake.” This finding states with particularity the trial court’s
good cause for concluding the slander claim was groundless—as the trial court found there was
no factual basis to support Bennett’s pleadings that Reynolds’ cattle had been sold accidentally
and there was no legal basis for his slander claim because substantial truth is a complete defense
to slander. See id. (groundless means no basis in law or fact and not warranted by good faith
argument for change of existing law); see also Randall’s Food Mkt., Inc. v. Johnson, 891 S.W.2d
640, 646 (Tex. 1995) (substantial truth of an alleged defamatory statement is complete defense to
slander action). Further, while Bennett testified in support of his allegations, the trial court does not
abuse its discretion when there is conflicting evidence that supports its decision, see Unifund CCR
Partners, 299 S.W.3d at 97, and Bennett has not challenged the legal sufficiency of this finding on
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appeal. In addition, the trial court finds in its order that Bennett’s deceit in covering up his
wrongdoing by doctoring or altering evidence, “confirms the groundlessness of the slander claim”
and was to “further his attempts to give grounds to his baseless harassment of Grant.” As such, we
cannot agree with Bennett’s contention in his brief that the sanctions order “fails to state good cause
for finding groundlessness with the particularity Rule 13 requires.” Rather, we conclude the
sanctions order states with particularity the reasons and circumstances justifying the trial court’s
finding of good cause to issue sanctions under Rule 13.26
Bennett further contends the award of sanctions against him individually was an
abuse of discretion because his lawyer signed and filed his pleadings, and “a party should not be
sanctioned for its attorney’s conduct unless the party is implicated apart from having entrusted its
legal representation to counsel.” See Loeffler v. Lytle Indep. Sch. Dist., 211 S.W.3d 331, 349–50
26
On rehearing, Bennett contends for the first time that “Grant never noticed any formal
hearing on his request for sanctions.” See Tex. R. Civ. P. 13 (sanctions may be imposed upon
motion or upon court’s own initiative, after notice and hearing); Tex. Civ. Prac. & Rem. Code
§ 10.002–3 (same). The record, however, shows that Bennett’s counsel was served with notice of
the sanctions hearing. Moreover, “the proper method to preserve [Bennett’s] notice complaint was
to bring the lack of adequate notice to the attention of the trial court at the hearing, object to the
hearing going forward, and/or move for a continuance.” See Low v. Henry, 221 S.W.3d 609, 618
(Tex. 2007). Bennett additionally complains on rehearing that “Grant never filed a formal motion
for sanctions.” Bennett failed to raise this issue at the trial court or in his appeal. Grant did plead
for attorneys’ fees based on Bennett’s filing of a groundless claim, and the trial court had submitted
a jury question asking whether Bennett’s slander claim was groundless and brought in bad faith or
for purposes of harassment. The jury answered affirmatively. Grant then moved the court to enter
final judgment sanctioning Bennett for filing a groundless claim brought in bad or for purposes of
harassment. Prior to the court’s sanctions order, Bennett also filed a brief with the court contending
that he should not be sanctioned because his claims were not groundless nor brought in bad faith or
for purposes of harassment. Thus, on the record, Grant moved the trial court to issue sanctions and
Bennett plainly had notice of the grounds on which Grant was seeking sanctions and an opportunity
to respond.
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(Tex. App.—San Antonio 2006, pet. denied). Again, we disagree. While Bennett’s attorneys filed
and signed his pleadings, Bennett provided the factual basis for the slander claim and authorized
his attorneys to file suit based on those allegations. Further, the trial court made several specific
findings that sanctionable conduct was attributable to Bennett himself27 and that Bennett had
brought the slander suit as revenge for Grant testifying against him in previous suits. As such, we
cannot conclude the trial court abused its discretion in finding that Bennett was implicated in the
sanctionable conduct. Concluding he has failed to prove on appeal that the trial court’s award of
sanctions was arbitrary or unreasonable, we overrule Bennett’s sole individual issue on appeal.28
27
The trial court’s order provides many instances of Bennett personally implicating
himself, including one instance where he—outside the presence of the jury—altered a hand-drawn
exhibit depicting Reynolds’ brand. When confronted about the alteration, Bennett claimed he
was merely highlighting the exhibit so the jury could see it better, and that it was okay because
the Judge was in the courtroom when he made the alteration. The trial court notes in its order that
“although the Judge was present in the room, such alteration was not observed or sanctioned by
anyone, the Court included.” In addition to the sanctions expressly authorized by Rule 13 and
Chapter 10, the trial court has the inherent power to sanction such bad faith conduct that occurs
during the course of litigation. See Public Util. Comm’n v. Cofer, 754 S.W.2d 121, 124 (Tex. 1988);
Eichelberger v. Eichelberger, 582 S.W.2d 395, 398 (Tex. 1979).
28
We acknowledge that the amount of attorneys’ fees awarded as sanctions is significant.
Chapter 10 and Rule 13, however, specify that attorneys’ fees caused by improper conduct are an
appropriate sanction. See Tex. Civ. Prac. & Rem. Code § 10.004(c)(3); Tex. R. Civ. P. 13. Bennett
has not raised any challenge to the amount of the award on appeal. On rehearing, Bennett contends
he is entitled to remand to allow the trial court to reconsider the amount of the award in light of the
Texas Supreme Court’s recent opinion in Nath v. Texas Children’s Hospital. See 446 S.W.3d 355,
372 (Tex. 2014) (holding that sanctions were warranted but remand was necessary to determine
whether, by litigating for over four years before seeking sanctions, the moving party bore some
responsibility for the attorneys’ fees it incurred). In Nath, however, the sanctioned party preserved
error by challenging the excessiveness of the attorneys’ fees at the trial court and on appeal. See
446 S.W.3d at 361, 364. Here, Bennett did not raise the issue of excessiveness at the trial court nor
on appeal. Under these circumstances, we cannot conclude he is entitled to remand under Nath.
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CONCLUSION
This is an unusual case. Malicious prosecution itself is an unusual tort, and it is
exceptionally unique under Texas jurisprudence for a defendant to procure a prosecution by both
providing false information to authorities and by engaging in such other improper activities that his
conduct became the determining factor in the decision to prosecute. Looking to the exemplary
damages award, this case is also unique because another exemplary damages award, in Bennett I,
has already been adjudicated by the Texas Supreme Court and found unconstitutional. The facts
and circumstances of this case, however, are vastly different than those in Bennett I and justify the
imposition of a larger exemplary damages award. This case differs from Bennett I—and again is
somewhat unique under Texas jurisprudence—because it is a potential-harm case and all but one of
the five reprehensibility factors are present. As remitted, we are confident the exemplary damages
award passes constitutional muster under current federal standards.29 Accordingly, we reform the
trial court's judgment to award Grant $512,109 in exemplary damages against Bennett and $512,109
in exemplary damages against Bonham. We affirm the trial court's judgment as reformed.
__________________________________________
Scott K. Field, Justice
Before Chief Justice Rose, Justices Pemberton and Field
Reformed and, as Reformed, Affirmed on Motion for Rehearing
Filed: March 20, 2015
29
In response to our opinion issued in this appeal on August 13, 2014, Grant filed with the
district court a remittitur reducing his $2 million exemplary damages award against Bennett and
Bonham to an award of $512,109 against each defendant. See Tex. R. App. P. 46.3.
56