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Click here for the full text of this decision FACTS:Chapter 242 of the Texas Health & Safety Code governs nursing homes. This regulatory scheme includes, among other things, a statutory requirement for the oral and written reporting of abuse and neglect to the Texas Department of Human Services or a law enforcement agency. A nursing home owner’s or employee’s failure to report under �242.122 is a Class A misdemeanor. In addition, �242.133 prohibits retaliation for reporting a violation of law and provides nursing home employees who are retaliated against for reporting a violation of law with a retaliation cause of action. An affected employee may recover: 1. the greater of $1,000 or actual damages, including mental anguish damages and lost wages; 2. exemplary damages; 3. court costs; and 4. attorneys’ fees. Under the law, the employee has the burden of proof, except there is a rebuttable presumption that the person’s employment was suspended or terminated for reporting abuse or neglect if the person is suspended or terminated within 60 days after the date on which the person reported in good faith. In May 2000, Cathy Winters, a nurse for almost 30 years, began employment by Town Hall Estates-Whitney Inc. (Town Hall), a nursing home owned by American Religious Town Hall Meeting Inc. (ARTH). Darren Long was Town Hall’s administrator, and his wife Crystal was the assistant administrator. Both served on the boards of Town Hall and ARTH. Winters worked the night shift (11 p.m. to 7 a.m.) on Friday, June 29, 2001. On the morning of Saturday, June 30, A.R., an elderly female resident of Town Hall, complained to Winters that overnight Pete Coviello, a certified nursing assistant (CNA), had exposed his penis to A.R. and made her touch it. Without giving him a reason, Winters told Pete to stay out of A.R.’s room the rest of the shift and asked the charge nurse, Beth Lewis, whether and how to write up the incident in A.R.’s chart. Lewis said she did not know, and nothing was written in A.R.’s chart. Winters then called Fran Jackson, a floor nurse and Winters’ supervisor, at home, and reported A.R.’s allegation. According to Winters, Jackson indicated that she wasn’t happy to hear about the allegation. Because of A.R.’s history of false complaints and belligerence, both Winters and Jackson were unsure about the truth of A.R.’s allegation; Jackson testified that Winters told her she felt she had a duty to report it to Jackson. Jackson went to work that morning, spoke with Winters again about the allegation, and then interviewed A.R., who repeated a similar allegation. Jackson wrote a summary of her interview with A.R. and then called Crystal Long, the assistant administrator, at home, and informed her of the situation. Jackson also relayed Winters’ report and Winters’ disbelief in the allegation. Two days later, the Longs terminated Winters’ employment, stating that she was being terminated for insubordination and progressive discipline. Winters sued for retaliatory discharge under �242.133 against the Longs, Town Hall and ARTH. A jury unanimously found that Winters was terminated for reporting sexual abuse of a resident to her supervisor and awarded her $3,100 for lost wages, $20,000 in compensatory damages and $34,200 for attorneys’ fees. Based on a finding that the Longs, Town Hall and ARTH acted with malice in terminating Winters’ employment, the jury unanimously assessed exemplary damages against the Longs for $20,000 each, against Town Hall for $2,000 and against ARTH for $350,000. In accordance with the cap in Texas Civil Practice & Remedies Code �41.008(b), the trial court reduced the exemplary damages award against ARTH to $200,000 and otherwise entered a judgment based on the jury’s findings. HOLDING:Modified in part, and affirmed as modified. The Longs, Town Hall and ARTH, the nursing home appellants (the Longs), first argued on appeal that Winters did not make a report under the retaliatory discharge statute, because she did not believe A.R.’s allegation of sexual abuse. The court stated that this “superficially clever contention does not withstand scrutiny in the context of chapter 242 and the facts of this case.” Nothing in these statute, the court found, supports the Longs’ argument that Winters’ report needed to be made in accordance with ��242.122-.125 before the protection against retaliation became available. Thus, the court held that as a matter of law Winters made reports of a violation of law as contemplated by �242.133. Next, the court found that legally and factually sufficient evidence supported the jury’s finding that Winters made a report of abuse under the relevant statute and that she was retaliated against for making a report. ARTH, the parent corporation of Town Hall, complained that the evidence was legally and factually insufficient to support the jury’s finding that ARTH retaliated against Winters. The trial court allowed Winters to piece the corporate veil to hold ARTH, Town Hall’s corporate parent, liable. The evidence relied on by Winters to pierce the corporate veil and reach ARTH, Town Hall’s parent, was that: 1. the Longs were members of the boards of directors of both ARTH and Town Hall; 2. one sentence in Town Hall’s personnel manual generally refers to “employees of Town Hall and ARTH;” and 3. ARTH’s president testified that he had the authority to discipline and terminate Darren. Such evidence, the court stated, was legally insufficient to support a finding that ARTH is vicariously liable for Town Hall’s retaliation liability under an alter ego theory. The court also found that sufficient evidence supported to support the jury’s finding by clear and convincing evidence that the nursing home appellants acted with malice. Because it forbade Winters from piercing ARTH’s corporate veil, the court modified the judgment to provide that Winters take nothing from ARTH, but otherwise affirmed the trial court’s judgment. OPINION:Vance, J.; Vance and Reyna, J.J. DISSENT:Gray, C.J. “Even Winters’s statement of the facts of Gonzales points out the apt comparison with Winters’s case. Winters did not report that a violation of law occurred, or that she believed one had; Winters only informed her supervisor that she felt it necessary to tell the supervisor that a resident had reported a violation, but that Winters did not believe the resident. Winters thus did not report to her supervisor that a violation of law had occurred. Accordingly, Winters does not establish a cause of action under Section 242.133. We should sustain Town Hall’s first issue.”

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