HBA-NIK C.S.H.C.R. 127 76(R)BILL ANALYSIS Office of House Bill AnalysisC.S.H.C.R. 127 By: Maxey Civil Practices 5/1/1999 Committee Report (Substituted) BACKGROUND AND PURPOSE The AFEX Corporation (company) alleges that on March 19, 1992, the company entered into an agreement with the Texas A&M University System (university system) and two professors employed by the university, Dr. Mark Holtzapple and Dr. Richard Davison, and that the university has breached the agreement. C.S.H.C.R. 127 grants the AFEX Corporation permission to sue the State of Texas and the Texas A&M University System subject to Chapter 107 (Permission to Sue the State), Civil Practice & Remedies Code. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. ANALYSIS C.S.H.C.R. 127 grants the AFEX Corporation (company) permission to sue the State of Texas and The Texas A&M University System (university system) subject to Chapter 107 (Permission to Sue the State), Civil Practice & Remedies Code. Requires the suit authorized by this resolution to be brought in Brazos County. Prohibits the total of all damages awarded in the suit authorized by this resolution, and prejudgment interest awarded under law, from exceeding $100,000. Prohibits the company from pleading an amount in excess of that amount in a suit authorized by this resolution. Provides that this is the total amount that may be recovered with respect to the agreement that is the subject of this resolution in all action brought with respect to that agreement. Provides that the payment of any damages awarded in a suit authorized by this section from the state treasury is subject to appropriations. Provides that it is the intent of the 76th Legislature that, if damages are awarded in s suit authorized by this resolution, the damages be paid from money appropriated to or otherwise available to the university system and that additional money should not be appropriated for the purpose of paying these damages. Provides that the remedies available to the company on the suit authorized by this resolution are limited to the remedies traditionally available for breach of contract, except that the company may not recover consequential or exemplary or punitive damages resulting from any breach of contract, and that this resolution does not authorize suit on any claim that sounds in tort. Provides that the chancellor of the university system be served process as provided by Section 107.002(a)(3) (Effect of Grant of Permission), Civil Practice & Remedies Code. COMPARISON OF ORIGINAL TO SUBSTITUTE C.S.H.C.R. 127 removes the following allegations from the original bill: (1) on March 19, 1992, AFEX Corporation entered into an agreement with the Texas A&M University System and two professors employed by the university, Dr. Mark Holtzapple and Dr. Richard Davison; (2) the agreement contained a representation and warranty that the Texas A&M University System had not incorporated or used confidential information of the Colorado State University Research Foundation or AFEX Corporation, obtained before the date of the agreement, into research or technologies the right to which had not been transferred to the Colorado State University Research Foundation or AFEX Corporation in the agreement. (3) the agreement provided that confidential information of AFEX Corporation would not be revealed. (4) the agreement stated that the Texas A&M University System was to assign certain rights in technologies, patent rights, and patent applications it had at the time of the agreement, to the Colorado State University Research Foundation, which would then license those rights to AFEX Corporation; (5) the agreement obligated the Texas A&M University System to enter into sponsored agreements with AFEX Corporation under defined circumstances; (6) that both Dr. Holtzapple and Dr. Davison were to assign their rights in the technologies, patent rights, and patent applications directly to AFEX Corporation; (7) Dr. Bruce Dale, while a professor at Texas A&M University, was bound to comply with the confidentiality requirements of the agreement, as well as confidential obligations that arose out of his relationship with AFEX Corporation and its affiliates; (8) the Texas A&M University System has failed to comply with the agreement to transfer its rights of certain developments to the Colorado State University Research Foundation of AFEX Corporation, while using their confidential information, technologies, patent rights, and patent information. (9) the Texas A&M University System has breached the agreement by disclosing and using the confidential information of AFEX Corporation without AFEX Corporation's permission; (10) AFEX Corporation alleges that it has fulfilled its obligations under the terms of the agreement; and (11) AFEX Corporation has incurred damages and is entitled to the benefits of the agreement, common law rights, and attorney's fees and court costs; now, therefore, be it that AFEX Corporation permission to sue the State of Texas and the Texas A&M University System subject to Chapter 107 (Permission to Sue the State), Civil Practice & Remedies Code. Instead, C.S.H.C.R. 127 simply sets out the AFEX Corporation alleges that the Texas A&M University System breached the parties' agreement, and adds the following text: Requires the suit authorized by this resolution to be brought in Brazos County. Prohibits the total of all damages awarded in the suit authorized by this resolution, and prejudgment interest awarded under law, from exceeding $100,000. Prohibits the company from pleading an amount in excess of that amount in a suit authorized by this resolution. Provides that this is the total amount that may be recovered with respect to the agreement that is the subject of this resolution in all action brought with respect to that agreement. Provides that the payment of any damages awarded in a suit authorized by this section from the state treasury is subject to appropriations. Provides that it is the intent of the 76th Legislature that, if damages are awarded in s suit authorized by this resolution, the damages be paid from money appropriated to or otherwise available to the university system and that additional money should not be appropriated for the purpose of paying these damages. Provides that the remedies available to the company on the suit authorized by this resolution are limited to the remedies traditionally available for breach of contract, except that the company may not recover consequential or exemplary or punitive damages resulting from any breach of contract, and that this resolution does not authorize suit on any claim that sounds in tort.