Texas Supreme Court creates new standard holding governmental regulations must be more than rationally related to governmental interest under Article I, § 19 of the Texas Constitution

ASHISH PATEL, et al  v. TEXAS DEPARTMENT OF LICENSING AND REGULATION, et al, 12-0657 (Tex. June 26, 2015)

In this regulation case, the Texas Supreme Court held the Texas regulation for licensing of eyebrow threaders (the “Threaders”) is not rationally related to health and safety.  The importance of this case to local governments is the analysis of the extent to which any governmental regulation must be tied to its governmental purpose.

Eyebrow threading involves the removal of eyebrow hair and shaping of eyebrows with cotton thread. In 2011 commercial threading became regulated under  Tex. Occ. Code §1602.002 as a cosmetology practice. To get licensed an operator must complete between 750 and 1,500 hours of instruction and pass a test (depending on the type of license). The Threaders sought a declaration the regulations are unconstitutional since they place  “senseless burdens on eyebrow threaders and threading businesses without any actual benefit to public health and safety.” For example, out of the required hours, substantial time must be spent on topics such as makeup, management, cleansing, and aroma therapy. The tests required do not normally have questions regarding threading.  The State filed a plea to the jurisdiction and traditional summary judgment. The trial court denied the plea, but granted the State’s MSJ and denied the Threader’s MSJ.

The Court first determined the declaratory judgment claims triggered jurisdiction.  It carefully carved out an explanation that the case is not one about ultra vires actions, since such claims are to prevent officials from acting unlawfully. It is a claim directly challenging the constitutionality of a statute/regulation. The State is therefore a proper party, not simply the officials. The Threaders had standing to make the challenge, although the Court only focused on the two who were issued notices of violations. The cases are ripe since administrative enforcement, although not yet underway, is more than simply speculative. Additionally, since the relief available on administrative appeal is more limited than the relief sought in the present suit, the doctrine of redundant remedies (preventing UDJA actions on the same subjects as other avenues of relief) does not apply.  Further since the Threaders could not challenge the constitutionality of the rule under the administrative process, the doctrine likewise does not apply. The court then held Article I, § 19 of the Texas Constitution (due course of law provision) affords more protection than the federal constitution, so the federal “rational basis” standard is not applicable.

After a detailed analysis of the proper standard to review a Due Course of Law challenge the court ultimately held that to overcome the presumption a statute is constitutional “the proponent of an as-applied challenge to an economic regulation statute under § 19’s substantive due course of law requirement must demonstrate that either (1) the statute’s purpose could not arguably be rationally related to a legitimate governmental interest; or (2) when considered as a whole, the statute’s actual, real-world effect as applied to the challenging party could not arguably be rationally related to, or is so burdensome as to be oppressive in light of, the governmental interest.” Under this standard the Court did hold that the general regulation of threading is proper as some health concerns are associated with improper threading techniques. However the court held 42% of the training required had nothing to do with public health and safety relating to threading. The percentage is not as important if the hours are low in number, however, the cost and burden increase the larger the numbers jump. “In the case of the Threaders, however, the large number of hours not arguably related to the actual practice of threading, the associated costs of those hours in out-of-pocket expenses, and the delayed employment opportunities while taking the hours makes the number highly relevant to whether the licensing requirements as a whole reach the level of being so burdensome that they are oppressive.” In this case they are.  As a result, the regulations are unconstitutional.

Justice Boyde concurred but did not completely agree with the majority’s adoption of a new test under the §19.  However, he did hold that “if the application of any regulatory licensing scheme were ever constitutionally invalid, this one is.”

The dissent (which I found rather entertaining to read in classic Hecht fashion) took great issue with the new “oppressive” standard adopted by the majority. He would have held the federal “rational basis” test is all that is needed and if the regulations are rationally related to the objective, then the regulation is proper. The majority’s opinion was simply legislating from the bench and created a very impractical standard. Justice Guzman also dissented and emphasizes the impracticality of the new standard as well as the assertion the majority is legislating.

If you would like to read this opinion click here. Justice Johnson delivered the opinion of the Court, in which Justice Green, Justice Willett, Justice Lehrmann, and Justice Devine joined. Justice Willett delivered a concurring opinion, in which Justice Lehrmann and Justice Devine joined.  Justice Boyd delivered a concurring opinion.  Chief Justice Hecht delivered a dissenting opinion, in which Justice Guzman and Justice Brown joined.  Justice Guzman delivered a dissenting opinion.     The docket page with attorney information found here.