Texas 2017 - 85th Regular

Texas House Bill HB3308 Compare Versions

Only one version of the bill is available at this time.

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1	1	85R6515 CLG-F
2	2	By: Kuempel H.B. No. 3308
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to certain vehicle protection products.
8	8	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
9	9	SECTION 1. Section 17.45, Business & Commerce Code, is
10	10	amended by adding Subdivisions (14), (15), and (16) to read as
11	11	follows:
12	12	(14) "Vehicle protection product":
13	13	(A) means a product or system, including a
14	14	written warranty:
15	15	(i) that is:
16	16	(a) installed on or applied to a
17	17	vehicle; and
18	18	(b) designed to prevent loss or damage
19	19	to a vehicle from a specific cause; and
20	20	(ii) under which, after installation or
21	21	application of the product or system described by Subparagraph (i),
22	22	if loss or damage results from the failure of the product or system
23	23	to perform as represented in the warranty, the warrantor, to the
24	24	extent agreed on as part of the warranty, is required to pay
25	25	expenses to the person in this state who purchases or otherwise
26	26	possesses the product or system for the loss of or damage to the
27	27	vehicle; and
28	28	(B) may also include identity recovery, as
29	29	defined by Section 1304.003, Occupations Code, if the product or
30	30	system described by Paragraph (A) is financed under Chapter 348 or
31	31	353, Finance Code.
32	32	(15) "Warrantor" means a person named under the terms
33	33	of a vehicle protection product warranty as the contractual obligor
34	34	to a person in this state who purchases or otherwise possesses a
35	35	vehicle protection product.
36	36	(16) "Loss of or damage to the vehicle," for purposes
37	37	of Subdivision (14)(A)(ii), may also include unreimbursed
38	38	incidental expenses that may be incurred by the warrantor,
39	39	including expenses for a replacement vehicle, temporary vehicle
40	40	rental expenses, and registration expenses for replacement
41	41	vehicles.
42	42	SECTION 2. Section 17.46(b), Business & Commerce Code, as
43	43	amended by Chapters 1023 (H.B. 1265) and 1080 (H.B. 2573), Acts of
44	44	the 84th Legislature, Regular Session, 2015, is reenacted and
45	45	amended to read as follows:
46	46	(b) Except as provided in Subsection (d) of this section,
47	47	the term "false, misleading, or deceptive acts or practices"
48	48	includes, but is not limited to, the following acts:
49	49	(1) passing off goods or services as those of another;
50	50	(2) causing confusion or misunderstanding as to the
51	51	source, sponsorship, approval, or certification of goods or
52	52	services;
53	53	(3) causing confusion or misunderstanding as to
54	54	affiliation, connection, or association with, or certification by,
55	55	another;
56	56	(4) using deceptive representations or designations
57	57	of geographic origin in connection with goods or services;
58	58	(5) representing that goods or services have
59	59	sponsorship, approval, characteristics, ingredients, uses,
60	60	benefits, or quantities which they do not have or that a person has
61	61	a sponsorship, approval, status, affiliation, or connection which
62	62	the person does not;
63	63	(6) representing that goods are original or new if
64	64	they are deteriorated, reconditioned, reclaimed, used, or
65	65	secondhand;
66	66	(7) representing that goods or services are of a
67	67	particular standard, quality, or grade, or that goods are of a
68	68	particular style or model, if they are of another;
69	69	(8) disparaging the goods, services, or business of
70	70	another by false or misleading representation of facts;
71	71	(9) advertising goods or services with intent not to
72	72	sell them as advertised;
73	73	(10) advertising goods or services with intent not to
74	74	supply a reasonable expectable public demand, unless the
75	75	advertisements disclosed a limitation of quantity;
76	76	(11) making false or misleading statements of fact
77	77	concerning the reasons for, existence of, or amount of price
78	78	reductions;
79	79	(12) representing that an agreement confers or
80	80	involves rights, remedies, or obligations which it does not have or
81	81	involve, or which are prohibited by law;
82	82	(13) knowingly making false or misleading statements
83	83	of fact concerning the need for parts, replacement, or repair
84	84	service;
85	85	(14) misrepresenting the authority of a salesman,
86	86	representative or agent to negotiate the final terms of a consumer
87	87	transaction;
88	88	(15) basing a charge for the repair of any item in
89	89	whole or in part on a guaranty or warranty instead of on the value of
90	90	the actual repairs made or work to be performed on the item without
91	91	stating separately the charges for the work and the charge for the
92	92	warranty or guaranty, if any;
93	93	(16) disconnecting, turning back, or resetting the
94	94	odometer of any motor vehicle so as to reduce the number of miles
95	95	indicated on the odometer gauge;
96	96	(17) advertising of any sale by fraudulently
97	97	representing that a person is going out of business;
98	98	(18) advertising, selling, or distributing a card
99	99	which purports to be a prescription drug identification card issued
100	100	under Section 4151.152, Insurance Code, in accordance with rules
101	101	adopted by the commissioner of insurance, which offers a discount
102	102	on the purchase of health care goods or services from a third party
103	103	provider, and which is not evidence of insurance coverage, unless:
104	104	(A) the discount is authorized under an agreement
105	105	between the seller of the card and the provider of those goods and
106	106	services or the discount or card is offered to members of the
107	107	seller;
108	108	(B) the seller does not represent that the card
109	109	provides insurance coverage of any kind; and
110	110	(C) the discount is not false, misleading, or
111	111	deceptive;
112	112	(19) using or employing a chain referral sales plan in
113	113	connection with the sale or offer to sell of goods, merchandise, or
114	114	anything of value, which uses the sales technique, plan,
115	115	arrangement, or agreement in which the buyer or prospective buyer
116	116	is offered the opportunity to purchase merchandise or goods and in
117	117	connection with the purchase receives the seller's promise or
118	118	representation that the buyer shall have the right to receive
119	119	compensation or consideration in any form for furnishing to the
120	120	seller the names of other prospective buyers if receipt of the
121	121	compensation or consideration is contingent upon the occurrence of
122	122	an event subsequent to the time the buyer purchases the merchandise
123	123	or goods;
124	124	(20) representing that a guaranty or warranty confers
125	125	or involves rights or remedies which it does not have or involve,
126	126	provided, however, that nothing in this subchapter shall be
127	127	construed to expand the implied warranty of merchantability as
128	128	defined in Sections 2.314 through 2.318 and Sections 2A.212 through
129	129	2A.216 to involve obligations in excess of those which are
130	130	appropriate to the goods;
131	131	(21) promoting a pyramid promotional scheme, as
132	132	defined by Section 17.461;
133	133	(22) representing that work or services have been
134	134	performed on, or parts replaced in, goods when the work or services
135	135	were not performed or the parts replaced;
136	136	(23) filing suit founded upon a written contractual
137	137	obligation of and signed by the defendant to pay money arising out
138	138	of or based on a consumer transaction for goods, services, loans, or
139	139	extensions of credit intended primarily for personal, family,
140	140	household, or agricultural use in any county other than in the
141	141	county in which the defendant resides at the time of the
142	142	commencement of the action or in the county in which the defendant
143	143	in fact signed the contract; provided, however, that a violation of
144	144	this subsection shall not occur where it is shown by the person
145	145	filing such suit that the person neither knew or had reason to know
146	146	that the county in which such suit was filed was neither the county
147	147	in which the defendant resides at the commencement of the suit nor
148	148	the county in which the defendant in fact signed the contract;
149	149	(24) failing to disclose information concerning goods
150	150	or services which was known at the time of the transaction if such
151	151	failure to disclose such information was intended to induce the
152	152	consumer into a transaction into which the consumer would not have
153	153	entered had the information been disclosed;
154	154	(25) using the term "corporation," "incorporated," or
155	155	an abbreviation of either of those terms in the name of a business
156	156	entity that is not incorporated under the laws of this state or
157	157	another jurisdiction;
158	158	(26) selling, offering to sell, or illegally promoting
159	159	an annuity contract under Chapter 22, Acts of the 57th Legislature,
160	160	3rd Called Session, 1962 (Article 6228a-5, Vernon's Texas Civil
161	161	Statutes), with the intent that the annuity contract will be the
162	162	subject of a salary reduction agreement, as defined by that Act, if
163	163	the annuity contract is not an eligible qualified investment under
164	164	that Act or is not registered with the Teacher Retirement System of
165	165	Texas as required by Section 8A of that Act;
166	166	(27) taking advantage of a disaster declared by the
167	167	governor under Chapter 418, Government Code, by:
168	168	(A) selling or leasing fuel, food, medicine, or
169	169	another necessity at an exorbitant or excessive price; or
170	170	(B) demanding an exorbitant or excessive price in
171	171	connection with the sale or lease of fuel, food, medicine, or
172	172	another necessity;
173	173	(28) using the translation into a foreign language of
174	174	a title or other word, including "attorney," "lawyer," "licensed,"
175	175	"notary," and "notary public," in any written or electronic
176	176	material, including an advertisement, a business card, a
177	177	letterhead, stationery, a website, or an online video, in reference
178	178	to a person who is not an attorney in order to imply that the person
179	179	is authorized to practice law in the United States;
180	180	(29) [(28)] delivering or distributing a solicitation
181	181	in connection with a good or service that:
182	182	(A) represents that the solicitation is sent on
183	183	behalf of a governmental entity when it is not; or
184	184	(B) resembles a governmental notice or form that
185	185	represents or implies that a criminal penalty may be imposed if the
186	186	recipient does not remit payment for the good or service;
187	187	(30) [(29)] delivering or distributing a solicitation
188	188	in connection with a good or service that resembles a check or other
189	189	negotiable instrument or invoice, unless the portion of the
190	190	solicitation that resembles a check or other negotiable instrument
191	191	or invoice includes the following notice, clearly and conspicuously
192	192	printed in at least 18-point type:
193	193	"SPECIMEN-NON-NEGOTIABLE";
194	194	(31) [(30)] in the production, sale, distribution, or
195	195	promotion of a synthetic substance that produces and is intended to
196	196	produce an effect when consumed or ingested similar to, or in excess
197	197	of, the effect of a controlled substance or controlled substance
198	198	analogue, as those terms are defined by Section 481.002, Health and
199	199	Safety Code:
200	200	(A) making a deceptive representation or
201	201	designation about the synthetic substance; or
202	202	(B) causing confusion or misunderstanding as to
203	203	the effects the synthetic substance causes when consumed or
204	204	ingested; [or]
205	205	(32) [(31)] a licensed public insurance adjuster
206	206	directly or indirectly soliciting employment, as defined by Section
207	207	38.01, Penal Code, for an attorney, or a licensed public insurance
208	208	adjuster entering into a contract with an insured for the primary
209	209	purpose of referring the insured to an attorney without the intent
210	210	to actually perform the services customarily provided by a licensed
211	211	public insurance adjuster, provided that this subdivision may not
212	212	be construed to prohibit a licensed public insurance adjuster from
213	213	recommending a particular attorney to an insured; or
214	214	(33) a warrantor of a vehicle protection product
215	215	warranty using, in connection with the product, a name that
216	216	includes "casualty," "surety," "insurance," "mutual," or any other
217	217	word descriptive of an insurance business, including property or
218	218	casualty insurance, or a surety business.
219	219	SECTION 3. Subchapter A, Chapter 348, Finance Code, is
220	220	amended by adding Section 348.014 to read as follows:
221	221	Sec. 348.014. TRANSACTION CONDITIONED ON PURCHASE OF
222	222	VEHICLE PROTECTION PRODUCT PROHIBITED. (a) In this section,
223	223	"vehicle protection product" has the meaning assigned by Section
224	224	17.45, Business & Commerce Code.
225	225	(b) A retail seller may not require as a condition of a
226	226	retail installment transaction or the cash sale of a motor vehicle
227	227	that the buyer purchase a vehicle protection product that is not
228	228	installed on the vehicle at the time of the transaction.
229	229	(c) A violation of this section is a false, misleading, or
230	230	deceptive act or practice within the meaning of Section 17.46,
231	231	Business & Commerce Code, and is actionable in a public or private
232	232	suit brought under Subchapter E, Chapter 17, Business & Commerce
233	233	Code.
234	234	SECTION 4. Subchapter A, Chapter 353, Finance Code, is
235	235	amended by adding Section 353.017 to read as follows:
236	236	Sec. 353.017. TRANSACTION CONDITIONED ON PURCHASE OF
237	237	VEHICLE PROTECTION PRODUCT PROHIBITED. (a) In this section,
238	238	"vehicle protection product" has the meaning assigned by Section
239	239	17.45, Business & Commerce Code.
240	240	(b) A retail seller may not require as a condition of a
241	241	retail installment transaction or the cash sale of a commercial
242	242	vehicle that the buyer purchase a vehicle protection product that
243	243	is not installed on the vehicle at the time of the transaction.
244	244	(c) A violation of this section is a false, misleading, or
245	245	deceptive act or practice within the meaning of Section 17.46,
246	246	Business & Commerce Code, and is actionable in a public or private
247	247	suit brought under Subchapter E, Chapter 17, Business & Commerce
248	248	Code.
249	249	SECTION 5. Chapter 2306, Occupations Code, is repealed.
250	250	SECTION 6. (a) On the effective date of this Act:
251	251	(1) an action, including a disciplinary or
252	252	administrative proceeding, pending under Chapter 51 or 2306,
253	253	Occupations Code, on the effective date of this Act related to an
254	254	alleged violation of Chapter 2306, Occupations Code, as that
255	255	chapter existed immediately before the effective date of this Act,
256	256	is dismissed;
257	257	(2) the Vehicle Protection Product Warrantor Advisory
258	258	Board is abolished; and
259	259	(3) a registration issued under former Chapter 2306,
260	260	Occupations Code, expires.
261	261	(b) As soon as practicable after the effective date of this
262	262	Act, the Texas Commission of Licensing and Regulation shall repeal
263	263	all rules regarding the regulation of vehicle protection product
264	264	warrantors adopted under former Chapter 2306, Occupations Code.
265	265	(c) An administrative penalty assessed by the Texas
266	266	Commission of Licensing and Regulation or the executive director of
267	267	the Texas Department of Licensing and Regulation related to a
268	268	violation of Chapter 2306, Occupations Code, as that chapter
269	269	existed immediately before the effective date of this Act, may be
270	270	collected as provided by Chapter 51, Occupations Code.
271	271	(d) The repeal by this Act of Chapter 2306, Occupations
272	272	Code, does not affect the validity or terms of a vehicle protection
273	273	product warranty that was issued or renewed before the effective
274	274	date of this Act.
275	275	SECTION 7. Section 17.46(b), Business & Commerce Code, as
276	276	amended by this Act, applies only to a cause of action that accrues
277	277	on or after the effective date of this Act. A cause of action that
278	278	accrued before the effective date of this Act is governed by the law
279	279	in effect immediately before the effective date of this Act, and
280	280	that law is continued in effect for that purpose.
281	281	SECTION 8. Sections 348.014 and 353.017, Finance Code, as
282	282	added by this Act, apply only to a transaction for the purchase of a
283	283	motor vehicle or commercial vehicle, as applicable, that occurs on
284	284	or after the effective date of this Act. A transaction for the
285	285	purchase of a motor vehicle or commercial vehicle that occurs
286	286	before the effective date of this Act is governed by the law in
287	287	effect on the date the transaction occurred, and the former law is
288	288	continued in effect for that purpose.
289	289	SECTION 9. To the extent of any conflict, this Act prevails
290	290	over another Act of the 85th Legislature, Regular Session, 2017,
291	291	relating to nonsubstantive additions to and corrections in enacted
292	292	codes.
293	293	SECTION 10. This Act takes effect September 1, 2017.