Second Court of Appeals

Summaries of Civil Opinions and Published Criminal Opinions Issued - Week of December 6, 2021.

NOTE: Summaries are prepared by the court's staff attorneys and law clerks for public information only and reflect his or her interpretation alone of the facts and legal issues. The summaries are not part of the court's opinion in the case and should not be cited to, quoted, or relied upon as the opinion of the court.

Links to full text of opinions (PDF version) can be accessed by clicking the cause number.

Visa, Inc. v. Sally Beauty Holdings, Inc., No. 02-20-00339-CV (Dec. 9, 2021) (Sudderth, C.J., joined by Wallach and Walker, JJ.).

Held:  After Appellee’s allegedly sub-par network security facilitated a payment-card network hack, Appellant assessed liquidated damages against the bank that connected Appellee to Appellant’s payment-card network.  Appellee, acting as assignee of the bank, sued Appellant for breach of contract; it claimed that the liquidated-damages provision was an unenforceable penalty.  Appellant countersued for fraud.  The trial court erred by granting summary judgment for Appellee on Appellee’s breach-of-contract claim and on Appellant’s fraud counterclaim. 

Regarding the breach-of-contract claim (which was governed by California law), the trial court erred by holding that the liquidated-damages provision was an unenforceable penalty.  The provision was presumed valid and none of Appellee’s arguments invalidated it; the liquidated-damages provision was not invalid because it liquidated Appellant’s payments to third parties, nor because it captured only one aspect of the bank’s liability for the breach, nor because Appellant had the discretion to unilaterally alter the contract.

Regarding the fraud counterclaim (which was governed by Texas law), Appellant had standing to assert it, and Appellant’s pleadings were sufficient to state a claim for fraud. 

Massey v. State, No. 02-20-00140-CR, 02-20-00149-CR (Dec. 9, 2021) (Birdwell, J., joined by Kerr and Bassel, JJ.).

Held: Appellant did not consent to a search of his person by simply complying with an officer’s directive to turn around and submit to a search.  Furthermore, the taint of the illegal search was not attenuated when Appellant allegedly committed resisting offenses after the frisk because the alleged offenses were petty and predictable responses to an illegal search.