Ken Paxton, in His Official Capacity as Texas Attorney General v. Powered by People

Court of Appeals of Texas·Decided September 24, 2025·No. 15-25-00141-CV·Published

Opinion

ACCEPTED 15-25-00141-CV FIFTEENTH COURT OF APPEALS No. 15-25-00141-CV AUSTIN, TEXAS 9/24/2025 3:55 PM In the Court of Appeals CHRISTOPHER A. PRINE CLERK for the Fifteenth Judicial District15th COURT FILED IN OF APPEALS

Austin, Texas AUSTIN, TEXAS 9/24/2025 3:55:30 PM CHRISTOPHER A. PRINE Clerk Ken Paxton, in his official capacity as Texas Attorney General, Appellant, v. Powered by People, Appellee.

On Appeal from the 41st Judicial District Court, El Paso County

BRIEF FOR APPELLANT

Ken Paxton Abigail E. Smith Attorney General of Texas Assistant Attorney General State Bar No. 24141756 Brent Webster First Assistant Attorney General Office of the Attorney General Consumer Protection Division Johnathan Stone 12221 Merit Drive, Ste. 650 Chief, Consumer Protection Division Dallas, Texas 75251 Tel: (214) 290-8830 Fax: (214) 969-7615

Counsel for Appellant Identity of Parties and Counsel

Appellant: Ken Paxton, in his official capacity as Texas Attorney General

Appellate and Trial Counsel for Appellant: Abigail E. Smith Johnathan Stone Assistant Attorney General Division Chief, Consumer Protection State Bar No. 24141756 State Bar No. 24071779 Abby.Smith@oag.texas.gov Johnathan.Stone@oag.texas.gov

Rob Farquharson Scott Froman Assistant Attorney General Assistant Attorney General State Bar No. 24100550 State Bar No. 24122079 Rob.Farquharson@oag.texas.gov Scott.Froman@oag.texas.gov

Office of the Attorney General of Office of the Attorney General of Texas Texas Consumer Protection Division Consumer Protection Division 12221 Merit Drive, Ste. 650 P.O. Box 12548 (MC-010) Dallas, Texas 75251 Austin, Texas 78711

iii Appellee: Powered by People

Appellate and Trial Counsel for Appellee: Mimi Marziani Lynn Coyle Texas Bar No. 24091906 State Bar No. 24050049 mmarziani@msgpllc.com lynn@coylefirm.com

Rebecca (Beth) Stevens Benoit Legal PLLC Texas Bar No. 24065381 2700 Richmond Ave. bstevens@msgpllc.com El Paso, TX 79930 Telephone: (915) 276-6700 Joaquin Gonzalez State Bar No. 24109935 jgonzalez@msgpllc.com

MARZIANI, STEVENS & GONZA- LEZ PLLC 500 W. 2nd St., Suite 1900 Austin, TX 78701 Telephone: (210) 343-5604

iv Table of Contents Page(s) Identity of Parties and Counsel .............................................................................. iii Index of Authorities ............................................................................................... vi Record References ................................................................................................. ix Statement of the Case ............................................................................................ ix Statement of Jurisdiction ....................................................................................... ix Issues Presented ..................................................................................................... x Statement of Facts ................................................................................................ 12 I. The Office of the Attorney General Investigates Powered by People for Potentially Violating Texas Law. ............................................. 12 II. Procedural History .................................................................................. 13 Summary of the Argument .................................................................................... 16 Standard of Review ...............................................................................................20 Argument..............................................................................................................20 I. A Court Implicitly Denies a Plea to the Jurisdiction When It Rules a Party Is Likely to Succeed on the Merits of its Claims and Proceeds to Merits Discovery. .................................................................20 A. A court that reaches the merits of the case has implicitly rejected any live jurisdictional challenges on the pleadings. ...............20 B. This case is legally and factually distinct from City of Austin, and if this Court disagrees, it should await the outcome of the appeal in City of Austin before ruling on this case. ............................. 26 II. The Trial Court Should Have Granted the Attorney General’s Plea to the Jurisdiction Because Appellee’s Claims are Moot. ................. 29 A. Appellee’s claims seeking relief from the RTE are moot on their face because the RTE is withdrawn and cannot be reissued. ............................................................................................ 29 B. No exception to mootness applies. .................................................... 31 Prayer ................................................................................................................... 38 Certificate of Compliance ..................................................................................... 38 Appellant’s Appendix ........................................................................................... 39

v Index of Authorities Cases Austin Parents for Med. Choice v. Austin Indep. Sch. Dist., No. 03-21-00681- CV, 2023 WL 5109592 (Tex. App.—Austin Aug. 10, 2023, no pet.) ............... 35 Bexar Metro. Water Dist. v. City of Bulverde, 234 S.W.3d 126 (Tex. App.— Austin 2007) ........................................................................................ 17, 32, 35 Borgelt v. Austin Firefighters Ass’n, IAFF Loc. 975, 692 S.W.3d 288 (Tex. 2024) ............................................................................................................. 22 Brownback v. King, 592 U.S. 209 (2021) ............................................................... 22 Carswell v. Camp, 54 F.4th 307 (5th Cir. 2022) .................................................... 20 Curry v. Harris Cnty. Appraisal Dist., 434 S.W.3d 815 (Tex. App.— Houston [14th Dist.] 2014, no pet.)................................................................ 22 DaimlerChrysler Corp. v. Inman, 252 S.W.3d 299 (Tex. 2008) .............................. 22 DeFunis v. Odegaard, 416 U.S. 312 (1974)............................................. 17, 30, 32, 33 Dickson v. Am. Gen. Life Ins. Co., 698 S.W.3d 234 (Tex. 2024)........................ 21, 22 Dubai Petrol. Co. v. Kazi, 12 S.W.3d 71 (Tex. 2000) ............................................. 22 Fin. Comm’n of Tex. v. Norwood, 418 S.W.3d 566, 578 (Tex. 2013) ........................ 21 Friends of the Earth, Inc. v. Laidlaw Envtl. Servs. (TOC), Inc., 528 U.S. 167 (2000) ....................................................................................................... 17, 32 Glassdoor, Inc. v. Andra Grp., LP, 575 S.W.3d 523 (Tex. 2019) ..............................29 Heckman v. Williamson Cnty., 369 S.W.3d 137 (Tex. 2012)....................................29 Herrera v. Mata, 702 S.W.3d 538 (Tex. 2024) ....................................................... 23 In re City of Dallas, 501 S.W.3d 71 (Tex.

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Ken Paxton, in His Official Capacity as Texas Attorney General v. Powered by People, (Tex. Ct. App. 2025).

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